ASDEO/ADEO Test KPPSC

Distinction between Financial accounting and Cost and Management accounting

S.No Financial accounting Cost and Management accounting 1 It is primarily for external purpose It is primarily for internal purpose 2 It provides information about the financial performance and financial position of the business It provides information of ascertainment of cost to control cost and for decision making about the cost. 3 It classified records, presents and interprets transaction in terms of money It classifies, records, presents and interprets in a significant manner the material, labour and overheads cost 4 It shows the profit or loss of the organization It provides the details of cost and profit of each product, process etc 5 Financial statements are prepared for a definite period, usually a year Its reports and statements are prepared as and when required. ...

Define Ledger. Also write down the list of “sub-division of Ledger”

The ledger is a book which contains a classified record of all similar transactions of the business, brought from the journal or from books of original entry. Note: the record kept in ledger is called “classified record” or “condensed record”. Types of ledger Ledger accounts can be prepared in the following two ways: 1- “T” accounts form/Traditional/Standard/Conventional form (British) 2- Running Balance Form/Modern Form (American) Different names of ledger Ø Secondary book Ø Book of final entry Note: ledger is King of all books of accounts. Sub-division of Ledger: 1. Debtors’ Ledger or customers’ Ledger or sales Ledger. 2. Creditors’ Ledger or Suppliers’ Ledger or purchase Ledger 3. General Ledger or nominal Ledger.

Distinction between Book-keeping and Accounting

S.No Book-keeping Accounting 1 It is the recording phase of an accounting system It is the summarizing phase of an accounting system 2 It s the basis of accounting It s the basis for business language 3 Persons responsible for bookkeeping are called book-keeper Persons responsible for accounting are called accountants 4 It does not require any special skill or knowledge It requires special skill and knowledge 5 Personal judgments of the bookkeeper is not required Personal judgments of the accountant is essential 6 Financial statements are not prepared from bookkeeping records Financial statements are prepared from accounting records. 7 It does not give the complete picture of the financial condition of the business unit It gives the complete e...

Accounting Knowledge

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