Top 20 Class 11th Accountancy Questions And Answers (2024)

Class 11th Accountancy: Preparing for Class 11th exams can be daunting, especially when it comes to subjects like Accountancy. To assist you in your preparation journey, we have curated a comprehensive list of the top 20 Class 11th Accountancy Important Questions and Answers. These questions have been carefully selected to give you a clear understanding of the types of questions that may appear in the exam.

By solving these sample questions, you will not only familiarize yourself with the exam pattern but also enhance your overall preparation levels. So, dive into these questions and gear up for success in your Class 11 Accountancy exams!

Top 20 Class 11th Accountancy Questions With Answers

Before diving into your preparation journey, it’s crucial to acquaint yourself with the comprehensive Class 11 Accountancy Syllabus. This step will guide you towards understanding the pivotal topics essential for exam success. Explore the following Top 20 Class 11th Accountancy Questions derived from the introductory section of accounting topics, ensuring a solid foundation for your preparation.

Here are some important Class 11th Accountancy questions and answers for 2024:

Question 1. What is accounting?

Answer: Accounting is the systematic process of recording, summarizing, analyzing, and interpreting a business’s financial transactions. It involves the preparation of financial statements such as the balance sheet, income statement, and cash flow statement to provide insight into the financial health and performance of the organization.

Question 2. What are the functions of accounting?

Answer: Accounting serves several key functions essential for the effective management of a business. These include:

• Recording: Documenting all financial transactions accurately and systematically.
• Classifying: Organizing transactions into categories such as assets, liabilities, equity, income, and expenses.
• Summarizing: Compiling financial data into reports such as balance sheets and income statements to provide a clear overview of the company’s financial position.
• Interpretation: Analyzing financial information to identify trends, patterns, and areas of concern or improvement.
• Communication: Presenting financial data to stakeholders such as investors, creditors, and management through reports and presentations.
• Decision-making: Assisting management in making informed decisions based on financial analysis and projections.

Question 3. What is the role of accounting?

Answer: Accounting plays various roles within an organization and in the broader business environment:

• Language: Accounting serves as the language of business, facilitating communication and understanding among stakeholders.
• Historical record: It provides a historical record of financial transactions, which can be used for analysis, comparison, and decision-making.
• Service provider: Accountants provide essential services such as bookkeeping, financial reporting, auditing, and tax preparation to businesses and individuals.
• Information system: Accounting systems collect, process, and disseminate financial information to support decision-making processes.
• Determining net profit: Accounting helps calculate the net profit or loss of a business by comparing revenues and expenses over a specific period.

Question 4. List the types of accounting.

Answer: Accounting encompasses various specialized fields, each serving specific purposes within an organization:

• Financial Accounting: Focuses on recording and reporting financial transactions to external stakeholders such as investors, creditors, and regulatory authorities.
• Cost Accounting: Involves analyzing and controlling the costs of production, distribution, and selling of goods and services within a business.
• Management Accounting: Provides internal stakeholders with financial information and analysis to support strategic planning, budgeting, and decision-making.
• Tax Accounting: Deals with preparing tax returns and ensuring compliance with tax laws and regulations.
• Social Responsibility Accounting: Evaluates and reports on the social and environmental impact of a company’s operations, including its corporate social responsibility initiatives.

Question 5. Differentiate between debtors and creditors of a company.

Answer:

• Debtors: Debtors are individuals or entities that owe money to the company for goods or services purchased on credit. They represent accounts receivable on the company’s balance sheet.
• Creditors: Creditors are individuals or entities to whom the company owes money for goods or services received on credit. They represent accounts payable on the company’s balance sheet.

Question 6. Define Accountancy.

Answer: Accountancy is the discipline that encompasses the principles, procedures, and techniques used to record, classify, summarize, interpret, and communicate financial information. It involves the application of accounting principles and standards to ensure accurate and reliable financial reporting.

Question 7. What are the different bases of accounting?

Answer: The two primary bases of accounting are:

• Cash Basis: This method records revenue and expenses when cash is actually received or paid. It does not consider credit transactions or accounts receivable/payable.
• Accrual Basis: This method records revenue and expenses as they are earned or incurred, regardless of the date cash is received or paid. It recognizes transactions as they occur, providing a more accurate depiction of a company’s financial position.

Question 8. What is the difference between accrual and cash basis of accounting?

Answer: Check the table below for the difference between accrual and cash basis of accounting:

Question 9. What are the basic accounting equations? How do you calculate Capital and Liabilities?

Answer: The basic accounting equation is:

Assets = Liabilities + Equity

This equation states that the total assets of a business are equal to the sum of its liabilities and equity.

To calculate capital, subtract liabilities from assets:

Capital = Assets – Liabilities

To calculate liabilities, subtract equity from assets:

Liabilities = Assets – Equity

Question 10. Explain GST.

Answer: GST, or Goods and Services Tax, is a value-added tax levied on the consumption of goods and services. It is a destination-based tax system where tax is collected at each stage of the supply chain and is ultimately borne by the end consumer. GST replaces multiple indirect taxes such as excise duty, service tax, and VAT, simplifying the tax structure and promoting ease of doing business.

Question 11. What is IFRS?

Answer: International Financial Reporting Standards (IFRS) are a set of accounting standards issued by the International Accounting Standards Board (IASB). They provide a common global language for financial reporting, ensuring transparency, comparability, and consistency in financial statements across different countries and industries. IFRS aims to enhance the quality, relevance, and reliability of financial information, thereby facilitating international investment and economic growth.

Question 12. What are the different types of liabilities?

Answer: Liabilities represent the obligations or debts owed by a company to external parties. The various types of liabilities include:

Question 13. What are compound vouchers?

Answer: Compound vouchers are accounting vouchers that record multiple transactions involving both debit and credit entries. These vouchers combine several individual transactions into a single document for convenience and efficiency in recording and processing accounting entries. Compound vouchers are commonly used in businesses to streamline the documentation of complex or repetitive transactions, such as payroll processing, expense reimbursem*nts, or inventory adjustments.

Question 14. Define a journal voucher.

Answer: A journal voucher is a document used to record accounting transactions in a company’s general ledger. It serves as the source document for entering journal entries, containing details such as the date of the transaction, accounts affected, description of the transaction, and amounts debited or credited.

Journal vouchers are typically prepared by accountants or bookkeepers based on supporting documentation such as invoices, receipts, or internal memos. They play a crucial role in maintaining accurate and transparent financial records and facilitating the preparation of financial statements.

Question 15. What rules must be observed when recording disparities in assets and expenses?

Answer: When recording differences in assets or expenses, two fundamental rules are applied:

• Debit and Credit: An increase in assets or expenses is recorded as a debit entry, while a decrease is recorded as a credit entry.
• Principle of Conservatism: When uncertain about the valuation or recognition of an asset or expense, accountants should err on the side of caution and recognize losses or impairments promptly, ensuring that financial statements reflect a conservative estimate of the company’s financial position and performance.

Question 16. What is the format of a journal?

Answer: The format of a Journal typically includes columns for:

The above table represents the complete format of a journal, including columns for the date, particulars, ledger folio (L.F.), debit amount, and credit amount. Each row corresponds to a single transaction recorded in the journal, providing a systematic and organized way to document financial transactions before they are transferred to the general ledger.

Question 17. __________ also known as a subsidiary journal?

Answer: Cashbook

Question 18. What are the different types of day books?

Answer: Daybooks, also known as subsidiary books or special journals, are used to record specific types of transactions. The different types of day books include:

• Purchase Book: Records purchases of goods for resale or production.
• Sales Book: Records sales of goods or services to customers.
• Cash Book: Records cash transactions, including receipts and payments.
• Purchase Return Book (Return Outwards): Records returns of goods to suppliers.
• Sales Return Book (Return Inwards): Records returns of goods from customers.
• Journal: Records miscellaneous transactions that do not fit into other specialized journals.

Question 19. What are the four types of cash books?

Answer: Cash books are specialized journals used to record cash transactions. Here are the four types of cash books:

• Single Column Cash Book: Contains a single column for recording cash transactions.
• Double Column Cash Book: Contains separate columns for cash and bank transactions.
• Three-Column Cash Book: Contains columns for cash, discount, and bank transactions.
• Petty Cash Book: Used to record small, miscellaneous cash expenses or payments, typically maintained for minor expenditures and replenished periodically.

Question 20. What are the different types of reserves?

Answer: Reserves represent funds set aside by a company for specific purposes or contingencies. The different types of reserves include:

• General Reserve: A reserve created out of profits to strengthen the financial position of the company or to meet future contingencies.
• Specific Reserve: A reserve earmarked for a particular purpose, such as a provision for doubtful debts or a reserve for repairs and maintenance.
• Capital Reserve: A reserve created from capital profits, such as the proceeds from the sale of fixed assets or revaluation of assets, which cannot be distributed as dividends.
• Revenue Reserve: A reserve created from revenue profits, such as retained earnings or accumulated profits from operations, available for distribution as dividends or reinvestment in the business.

Also Read: Accountancy MCQs for Class 11 and 12

How to Solve Class 11th Accountancy Questions?

Here are the top expert tips and tricks for solving Class 11th Accountancy Questions:

• Understand the Question: Read the Class 11th Accountancy question carefully to grasp what it’s asking for. Pay attention to keywords and instructions provided in the question to ensure you address all aspects.
• Review Relevant Concepts: Review the relevant concepts covered in your Class 11th Accountancy syllabus that are related to the question. Make sure you understand the underlying principles and theories to solve the problem accurately.
• Organize Your Approach: Plan how you will tackle the question. Break it down into smaller parts if necessary, and decide on the steps you need to take to arrive at the solution. This helps to ensure a structured and systematic approach to problem-solving.
• Apply Formulas and Techniques: Apply the appropriate formulas, methods, or techniques learned in your Class 11th Accountancy studies to solve the question. Use relevant accounting principles and rules to analyze the given data and arrive at the solution.
• Check Your Work: Once you’ve solved the Class 11th Accountancy question, review your solution to ensure accuracy. Double-check calculations, verify answers against the question requirements, and make any necessary revisions. This step helps to catch any errors and ensures that your solution is complete and correct.

Also Read: Class 11 Accountancy Overview, Syllabus, NCERT Solutions, Tips

Therefore, these top 20 Class 11th Accountancy questions for 2024 offer invaluable preparation resources for students. Covering a wide range of topics, from fundamental principles to advanced analyses, these questions help students enhance their understanding and excel in their exams.

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