NEB Account notes for class 11 New Course 2079.

Class 11 Account Notes, Neb Account notes for class 11 New Course.

The owner of the accountant cannot keep in mind all the financial transactions of the business for one year. Therefore, all financial transactions must be recorded daily on the ledger. The process of systematically and scientifically recording everyday financial transactions on a ledger  is called bookkeeping. It is also the art and science of trade registration. This includes , bookkeeping and book keeping.

 Accounting operation:

1. We maintain a permanent record of all financial transactions.

2. Provides a basis for determining the profit or loss earned by a company over a given period.

3. Helps disclose a company's financial position.

Importance of Accounting:

Accounting is the process of recording, classifying and summarizing all financial transactions to determine, interpret, and communicate to users the business and financial position at the end of a given period. It's art and science. It is an art because it requires certain real work and skills. It is a science because it is based on certain rules and regulations. This is a broader term than accounting.

Accounting Purpose:

1. Maintaining systematic and scientific records of all financial transactions in accordance with uniform rules and regulations.

2. Using the income statement and transaction account, find out the profit and loss of the company for a certain period of time.

3. Use the balance sheet to determine the financial position of the company.

Features of Accounting:

1. Accounting is related only to financial transactions.

2. Accounting is the act of recording financial transactions.

3. It is the process of classifying and summarizing financial transactions.

1. It ignores all non-financial aspects of the financial transactions.

2. There is no uniformity in the methods of valuing stock, charging depreciation, maintaining provision.

3. It ignores the price level change.

Meaning of Double Entry System of Bookkeeping:

Every transaction has two fold aspects. One is receiving aspects and another is giving aspects. Receiving aspects is debited and giving aspects is credited. Every debit has a corresponding credit, every credit has a corresponding facet and vice versa. This is called a double entry system in bookkeeping. A modern and scientific way to record transactions.

Features of the dual accounting system:

1. There are two aspects: debit and credit.

2. They have the same amount. One side of the transaction is debited and the other side is credited for the same amount. Total debit total equals total credit total.

3. Account Classification: Classify accounts into three categories: personal, real, and nominal.

 Main Purpose or Advantages of Double Accounting System:

1. Finding the actual profit and loss of a commercial company over a specific period.

2. Shows the actual financial position of the company at the end of each year.

3. Fix errors and minimize fraud.

Value of Debit Note:

This is a note sent to the supplier informing him that a portion of the returned product has been deducted from his account. It is also sent to the buyer to inform them of the recovery of the additional amount or price difference.

Value of Credit Note:

A note sent by the buyer to the supplier informing them that the value of the returned item has been credited to their account or informing them of a price difference.

Accounting area:

1. In a trading enterprise, accounting is required to calculate the actual profit and loss and financial position of a business. Accounting information is useful to stakeholders. Therefore, accounting is a very useful system for managing trading enterprises.

2. Non-Commercial Activities: The primary purpose of non-commercial activities is to provide a service to the public.Accounting helps you to record your expenses and income, as well as the resources that belong to them, completely and accurately. Therefore, accounting applies to non-trading enterprises.

3. Government: A proper accounting system is also required to control and manage government revenues and expenses. Records government economic events and transactions. There is a separate accounting system.

Difference Between Accounting and Accounting:

Accounting

1. Part of accounting.

2. In a broader sense than accounting.

3. No highly skilled labor required.

4. A highly skilled workforce is required.

5. It has to do with recording financial transactions.

6. He is engaged not only in registration, but also in the classification, generalization and transfer of accounting information.

Entrepreneurship Meaning:

In this concept, a corporation is treated as a separate unit from its owner. Only business transactions are recorded, not personal transactions.However, the owner's investments and blueprints in the business are recorded in the ledger. If the personal results of the activities and the financial situation of the business do not coincide with reality.

Importance of Business Concepts:

This concept assumes that the business will continue for a long time and the flow of transactions will continue. It is assumed that the benefits of certain expenditures will be sustained over the long term. In this concept, assets are classified into fixed assets and current assets, and liabilities are classified into short-term and long-term assets.

Significance of the Money Concept:

In this concept, only transactions that can be expressed in currencies such as rupees and US dollars are recorded, and transactions that cannot be expressed in money are not registered. Labor productivity, fights between managers and workers are not recorded because money management is impossible.
Value Value Principle:

In accordance with this principle, assets are recorded at their actual acquisition cost rather than their market value. If a skill is purchased for 11 lakh, the skill counts only 1 lakh. If the market value is one million won


Meaning of the reporting period Concept:

The business owner cannot combine the entire period of the business and determine the profit or loss. Therefore, according to this concept, the entire life of this concept is divided into appropriate periodic intervals to determine the outcome and financial position of the business. This periodic interval is called the base period. A one-year period is generally considered to be an appropriate reporting period starting on January 1 or 1 Baishak and ending on December 31 or the last Chaitra.

Qualities of a Good Cheque:

1. The date should be written properly in the cheque and should be presented to the bank with in the valid period.

2. The account number, amount in words, amount in figures should be mentioned properly.

3. The account holder must sign the check, which must be exactly the same as the sample signature.

Purpose of Trial Balance:

1. Verification of Arithmetic Correctness: One of the important purposes of preparing a trial balance is to provide verification of arithmetic correctness of financial transactions.

2. To find accounting errors: There are some errors in the journal entries and books because the trial balance says so. This will help accountants find errors.

3. Provide the basis for the creation of the final account: The trial balance is a description of the debit and credit balances in accounting and therefore provides the basis for the creation of the final account.


Over Looking Error Value:

Transaction is not recorded at all in the book of the original item (journal). In both the debit and credit parts, this has no effect on the trial balance. These types of errors are called omission errors. For example, if the value of the goods sold to Krishna is 150 rupees, it will not be recorded in the log.

Commission Error Value:

When an incorrect amount is recorded in the journal, the same amount affects others and cr. Trial balance side. So the trial balance will be the same. for example,Items sold by Shyam for 550 rupees are incorrectly recorded as 50

rupees. For example, a computer purchased for Rs 20,000 is deducted for the purchase of air conditioner.

Error Compensation Value:

When the action of one error is canceled by the action of another, this error is called a calibration error. For example, 500 Rs will be placed instead of 50 Rs when placed on the credit side of Krishna a/c, and 50 Rs instead of 500 Rs when placed on the credit side or Ram a/c.

Reserved Value:

A portion of the profit is set aside to cover future emergencies and losses. Part of the profit remains in the business to cover unforeseen future liabilities or loses to strengthen its financial position.

Value Small Money Fund:

Amount held by the government to make small payments. It is always equal to the original amount of the previous period. Distinguish between small payments and large payments.

Income Income Value:

This is the amount received in the normal operation of the business. It is the amount obtained from the sale of goods and services and is the main source of income. This is shown, for example, in the credit section of trading accounts and P&Ls. Receipts for money received by selling goods or services, in the form of discounts, rents, commissions, etc. In addition, the sale of stocks and fixed assets and any income there fromit is treated as a liability and reflected in the liability side of the balance sheet.

Difference between Income and Income on Capital:

Income on Capital
1. Has normality.

2. This is the wrong nature.

3. It is shown on the credit side of trading account and profit and loss account.

4. It is shown on the liabilities side of the liabilities side of the balance sheet.

5. Examples of income are sales of goods and services or money received in the form of discounts, interest, or commissions.

6. Amounts received as equity or in the form of loans from owners are examples of capital flows.

Value of Income Expenses:

All expenses incurred in connection with a business's daily activities are called income expenses. Produced to maintain profitability and efficiency of fixed assets. It is displayed in the trading account and in the debit part of the income statement. For example, wages paid to employees, repairs to property, rent paid to homeowners.

Capital Expenditure Value: Any cost to acquire a fixed asset is called a capital expenditure.This increases:

the profitability of your business. It is displayed in assets on the balance sheet. Expenses associated with the purchase of land, buildings, furniture, machinery, etc. are examples of capital expenditures.

Difference between Income and Cost of Capital:

Income and Expense

Cost of Capital

1. It is a regular character.

2. Irregular characters.

3. Offer up to 1 year.

4. Benefits are provided for years.

5. Appears in the debit portion of the trading account and in the income statement.

6. It is displayed in the asset balance.

Value of Capital Reserves:

 The reserves created from capital gains are called capital reserves. It is not created from profits earned in the normal course of business. Profits from the sale of fixed assets, profits from the sale of investments are sources of capital gains.

Value of Income Reserve:

 A reserve created from profits earned from income is called an income reserve.Income earned in the normal course of business. It was created to strengthen the financial position of the business.


Value of General Reserves: 

A reserve that is generated from profits for no specific purpose is called a general reserve. For general use at the discretion of the administrator. It is generated from profits earned in the normal course of business.

Specificity of Public Accounting:

1. Budget Chapter: All expenditures of public institutions are classified into different budget ranges, and expenditures are made only within approved budget ranges.

2. Banking: With the exception of the Beautiful Money Fund, all government transactions are expected to be conducted through banks with secret banking records.

3. Audit: The Board of Audit and Inspection audits the books of government agencies.

Accounting:

1. Accounting of financial transactions of income and expenses related to government agencies.

2. To avoid spending in excess of government-approved budget limits.

3. Pay in accordance with government regulations and regulations.

Features of the New Accounting System:

1. Dual Entry System: The new accounting system is based on a dual entry system in which one part is debited and the other part credited.

2. Classification of offices: The new accounting system classifies the government offices into central level and office and operating level office.

3. Use of forms: The new accounting system has prescribed 200 forms to be used by government offices.

Objectives of New Accounting System:

1. It gives systematic records of government transactions which support to prepare different statements and reports.

2. The annual budget is prepared by the government every year for which new accounting system provides historical financial data and information.

3. It safeguards different government properties like furniture, machinery, land and building.

Difference Between Government Accounting and Commercial Accounting:

Government accounting

Commercial accounting

1. The accounting system managed by a government agency is called government accounting.

2. The accounting system used by commercial organizations established for the purpose of for-profit is called commercial accounting.

3. Strictly comply with the national budget system.

4. It does not strictly follow the government budgeting system.

5. Office of Auditor General does the audit of book of accounting of government offices.

6.  A professional person like C.A. or any other auditor does the auditing of goods of accounting of business organizations.