Important Questions with Answers for CBSE Class 11 Accountancy Chapter 1 Introduction to Accounting which is outlined by expert Accountancy teachers from the latest version of CBSE (NCERT) books.
CBSE Class 11 Accountancy Chapter -1 Important Questions
Question 1
Define Accounting.
Answer: According to the American Institute of Certified Public Accountants, Accounting is, ‘It is an art of recording, classifying and summarising in a significant manner and in terms of money, transactions and events, which are, in part at least, of a financial character, and interpreting the results thereof.’
Question 2
Mention 3 functions of Accounting.
Answer: Functions of accounting are:
- Communicating financial information
- Budget preparation
- Preventing errors and frauds
Question 3
Define Book-keeping.
Answer: According to J.R. Batliboi, ‘Book-keeping is an art of recording business dealing in a set of books.’
Question 4
Mention 2 Differences between accounting and accountancy.
Answer:
| Accounting | Accountancy |
| Accounting is an art of recording, classifying and summarising in a significant manner and in terms of money, transactions and events, which are, in part at least, of a financial character, and interpreting the results thereof | Accountancy is a body of knowledge prescribing definite rules to be observed while recording, classifying and summarising of transactions. |
| It relies on Book-keeping. | It relies on both Book-keeping and Accounting. |
Question 5
Mention the types of accounting.
Answer: There are 5 types of accounting. Namely,
- Financial Accounting
- Cost Accounting
- Management Accounting
- Tax Accounting
- Social responsibility Accounting
| Important Topics in Accountancy: |
Question 6
Who are the users of Accounting?
Answer: The users may be categorised into 2 groups. Namely,
- Internal users
- External users
Question 7
What are the 3 advantages of accounting?
Answer: Advantages of accounting are,
- Helpful in business
- Helpful in decision making
- Helpful in controlling
Question 8
What are the 5 roles of accounting?
Answer: Roles of accounting are:
- Acting as the language of business
- Providing financial information to stakeholders
- Role in creation of budget
- Role in decision making
- Role in determining profit and loss
Question 9
What is the end product of financial accounting?
Answer: End product of financial accounting is ‘Financial Statements’.
Question 10
Mention 2 qualitative characteristics of accounting information.
Answer:
- Reliability
- Comparability
Question 11
Who among these are not External users of accounting information
1) Lenders
2) Government
3) Employees
4) Public
Answer: 3) Employees
Question 12
Which of the following is not a sub-field of accounting?
- Financial Accounting
- Cost Accounting
- Management Accounting
- Book-keeping
Answer: Book-keeping
Question 13
What is the traditional function of accounting?
Answer: Recording of financial transactions.
Question 14
Book-keeping begins where accounting ends. True or False?
Answer: False
Question 15
Accounting is the language of business. True or False?
Answer: True
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