NCERT Solution for Class 11 Accountancy Chapter 13 - Computerised Accounting System

*According to the latest update on the CBSE Syllabus 2023-24, this chapter has been removed.

NCERT Solutions are extremely helpful study materials while preparing for the CBSE Class 11 Accountancy examination. The NCERT Solutions are collated by the subject matter experts to help students grasp the concepts easily.

NCERT Solution for Class 11 Commerce Accountancy Chapter 13 – Computerised Accounting System furnishes us with all the concepts. As the students would have to learn the basic fundamentals of the subject of accountancy, NCERT Class 11 Solutions is a comprehensive study material which explains the concepts in a great way.

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Short Questions for NCERT Accountancy Solutions Class 11 Chapter 13

1. State the four basic requirements of a Database Application.

A database has the following basic requirements:

1. Back-end Database: A data storage system that remains hidden from users. It gives the user the authority to access it.

2. Front-End Interface: Acting as the connecting link that binds the user and database-oriented software through which communication takes place between the user and the back-end database.

3. Reporting System: Set of objects that include all relevant information comprehensive enough to prepare a report.

4. Data-Processing: Transforming input data to useful information by a sequence of actions essential for decision making

2. Name the various categories of the Accounting Package.

Accounting packages have the following categories:

1. Tailor-made Software

2. Ready to use software

3. Customised software

3. Give examples of two types of Operating Systems.

1. Single-User Operating System like DOS.

2. Multi-User Operating Systems like Windows and Linux.

4. List the various advantages of Computerised Accounting Systems.

The advantages of accounting systems that are computerised are as follows:

1. Accuracy

2. Speed

3. Scalability

4. Reliability

5. Real-term user interface

6. Up-to-date information

7. Document production

8. Legibility

5. Give two examples of each of the organisations where ‘ready-to-use’, ‘customised’, and ‘tailored’ accounting packages, respectively, are suitable to perform the accounting activity.

1. Ready-to-use accounting packages are used by small-sized enterprises like grocery stores, pharmacies, etc.

2. Customised accounting packages are used by medium to large businesses having a nationwide presence, like Shopping malls, hotels and restaurants.

3. Tailored accounting packages are used by businesses that are geographically scattered, like MNCs like Oil Industries and Software Companies.

6. Distinguish between ‘ready-to-use’ and ‘tailored’ accounting software.

Long Questions for NCERT Accountancy Solutions Class 11 Chapter 13

1. Define a Computerised Accounting System. Distinguish between a Manual and Computerised Accounting Systems.

An accounting information system that processes events and financial transactions according to the GAAP (Generally Accepted Accounting Principles) and produces reports as per user requirements is called a computerised accounting system.

There are two types of accounting systems, Manual and Computerised.

Here are some points of difference between Manual and Computerised accounting systems.

2. Discuss the advantages of Computerised Accounting Systems over Manual Accounting Systems.

The following are the various advantages of Computerised Accounting Systems over Manual Accounting Systems.

Speed: A computer will have a faster processing capacity than the manual recording of accounts, so a computerised system can process more accounting data than a manual setup.

Accuracy: A computerised system reduces the errors while recording data, as the information is fed once into the system and is used for subsequent queries but in the manual system, data needs to be written manually each time a new accounting report needs to be prepared.

Reliability: Computer software is made to perform repetitive tasks, it is more reliable to perform daily operations than a manual system. There is no limitation such as tiredness, boredom or fatigue in the case of computers which makes them more reliable.

Up-to-date information: The existing records in a computerised system get updated as soon as it is entered. While the same thing is not true for a manual system. Hence, information is not always up to date in a manual system.

Real-time User Interface: A computerised accounting system is interconnected to various other networks of computers, so information is available at the same time to all users. Such a system cannot be found in a manual entry.

Automated Document Production: Using the computerised system, financial documents such as Cash books, Statements of Accounts and Trial balances are easy to obtain. A computer system has pre-defined formats for generating accounting reports, with which report generation is a breeze, while the same cannot be held true for a manual system.

Scalability: Computerised systems of accounting are highly scalable, and no additional workforce is required to record data. In a manual system, a company has to hire many accountants to manage transactions.

Legibility: In a computerised accounting system, records are typed using a standard font. So the readability is clear. In manual entry writing of each accountant varies, so interpreting and reading written records becomes difficult and is prone to misinterpretation.

3. Describe the various types of accounting software along with their advantages and limitations.

Accounting software is of the following types:

i. Ready-to-use

ii. Customised

iii. Tailored

Ready-to-use: Such software is used primarily by small businesses which do not deal with a large number of transactions. This software is easily available in the market containing the standard features

Customised: This type of software has features to meet the requirements of special users. There is an option for customising the accounting features of the software. Functions can be programmed as per the requirements of the business. Used primarily by medium and large organisations.

Tailored: Tailor-made software is highly specific to a particular organisation, and it is used by organisations that are spread across geographies and have multiple users accessing the system. It is designed keeping in mind the requirements of the business.

Ready-to-use software has the following advantages:

1. Software that is easily available in the market.

2. Low installation and maintenance costs.

3. Less time is required to get acquainted with the software.

4. High adaptability and easy to learn.

5. Suited for small-sized enterprises.

Ready-to-use software has the following limitations:

1. Number of users is limited.

2. Not suitable for medium and large organisations.

3. Contains generic features.

4. Less scope of linking with other info.

Customised and Tailor-made accounting software has the following advantages:

1. Suitable for medium, large and geographically spread organisations.

2. Specific as per user requirement.

3. Can be modified as per business request.

4. Low cost of training.

Customised and Tailor-made accounting software has the following limitations:

1. Installation and maintenance are cost intensive.

2. Custom software development takes time.

4. ‘Accounting software is an integral part of the Computerised Accounting Systems.’ Explain briefly and list the generic considerations before sourcing accounting software.

Accounting software is an important part of the Computerised accounting system. Software should be selected considering the proficiency and skill of accounting professionals. This point should be evaluated before making a computerised accounting system a part of an organisation as accounting professionals.

Here are some points that are important and should be considered before introducing accounting software in an organisation:

1. Flexibility: Accounting software should be flexible in terms of data input, data retrieval and generation of reports. It should be able to run cross-platform across different operating systems and configurations.

2. Cost of Maintenance and Installation: Cost of installation plays a major part as it will involve hardware configuration to support the installation, cost of training staff, and data recovery in case of failure. Maintenance involves renewal and creating a backup.

3. Size of organisation: The type of software is also dependent upon the size of an organisation. Small businesses can use standard software, while customised software is required for large organisations.

4. Training Needs: Customised software require more training, while standard software requires less training.

5. Security: Security is a prime factor when selecting software for accounting, as any unauthorised access to the software can cause a loss of revenue to the organisation.

6. Reports: Software should be able to integrate with MIS software and prepare reports which can be used in the organisation

7. Vendor Reputation: Software should also be chosen based on customer support, post-sales support and any other assistance provided by vendors and also the reputation of vendors among organisations and good user reviews by users in the market.

5. ‘Computerised Accounting Systems are the best form of the accounting system.’ Do you agree? Comment.

Computerised systems are the best form of accounting system, as it is easier to maintain records which result in fewer errors, computer systems are highly reliable and enhance overall efficiency. The aspects are mentioned below:

Speed: A computer will have a faster processing capacity than a manual recording of accounts, so a computerised system can process more accounting data than a manual setup.

Accuracy: A computerised system reduces errors while recording data, as the information is fed once into the system and is used for subsequent queries, but in a manual system, data needs to be written manually each time a new accounting report needs to be prepared.

Reliability: Computer software is made to perform repetitive tasks, it is more reliable to perform daily operations than a manual system. There is no limitation such as tiredness, boredom or fatigue in the case of computers which makes them more reliable.

Up-to-date information: The existing records in a computerised system get updated as soon as it is entered. While the same thing is not true for a manual system. Hence, information is not always up to date in a manual system.

Real-time User Interface: A computerised accounting system is interconnected to various other networks of computers, so information is available at the same time to all users. Such a system cannot be found in a manual entry.

Automated Document Production: Using the computerised system, financial documents such as Cash books, Statements of Accounts, and Trial Balances are easy to obtain. A computer system has pre-defined formats for generating accounting reports, with which report generation is a breeze, while the same cannot be held true for a manual system.

Scalability: Computerised systems of accounting are highly scalable, and no additional workforce is required to record data. In a manual system, a company has to hire many accountants to manage transactions.

Legibility: In a computerised accounting system, records are typed using a standard font. So the readability is clear. In manual entry writing of each accountant varies, so interpreting and reading written records becomes difficult and is prone to misinterpretation.

Concepts covered in this chapter

• Concept of computerised accounting system
• Comparison between manual and computerised
• Advantages of computerised accounting system
• Limitations of computerised accounting system
• Sourcing of accounting software
• Accounting packages
• Ready to use
• Customised
• Tailored
• Generic considerations before sourcing an accounting software
• Flexibility
• Cost of installation and maintenance
• Size of organisation
• Utilities/MIS report

Conclusion

NCERT Solutions for Class 11 Accountancy Chapter 13 provide a range of examples which assist the students in comprehending and learning quickly. The above-mentioned are the concepts discussed in the Class 11 CBSE syllabus. For more solutions and study materials of NCERT Solutions for Class 11 Accountancy, visit BYJU’S website or download the app for more information.