The accountant of a small firm feels that incomplete records system should not be followed. In spite of that it is easy to maintain accounts on single entry basis. The accountant suggest that double entry accounting system should be followed. Is the suggestion correct? Give reasons.

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Solution

The suggestion given by the accountnant is correct.
Double entry system gives better and reliable results. Under the incomplete records system, all the accounts are not maintained and, therefore, Trial Balance cannot be prepared. As a result, locating errors become difficult.

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The accountant of a small firm feels that incomplete records system should not be followed. In spite of that it is easy to maintain accounts on single entry basis. The accountant suggest that double entry accounting system should be followed. Is the suggestion correct? Give reasons.

The suggestion given by the accountnant is correct. Double entry system gives better and reliable results. Under the incomplete records system, all the accounts are not maintained and, therefore, Trial Balance cannot be prepared. As a result, locating errors become difficult.

The suggestion given by the accountnant is correct.
Double entry system gives better and reliable results. Under the incomplete records system, all the accounts are not maintained and, therefore, Trial Balance cannot be prepared. As a result, locating errors become difficult.