1. Simple and integrated
2. Speed

An asset is recorded in the books on the basis of the historical cost, that is, the acquisition cost. It records the cost of asset at the time of its purchase.

Drawings is the amount of cash or value of goods, assets, etc., withdrawn from the business by the owner for the personal use of the owner.

Total Cost = Purchase Price + Installtion Charges
= Rs 96,000 + Rs 24,000 = Rs 1,20,000
Amoount of Depreciation = \(\frac { Total\ cost\ -\ Scrap\ value }{ Estimated\ Life } \)
= \(\frac { 1,20,000-72,000 }{ 4 } \)
= Rs. 12,000
Rate of Depreciation = \(\frac { Annual\ Depreciation }{ Original\ cost } \times 100\)
= \(\frac { 12,000 }{ 1,20,000 } \times 100\)
= 10%

No, it is not necessary that a suspense account will balance after rectification of the errors detected by the accountant.
Suspense account can remain unbalanced if all the' errors are not detected. Balance remaining in the suspense account is transferred to the balance sheet on the assets side, if there is a debit balance, or the liabilities side if there is a credit balance.

No, she purchases and sells goods both on cash and credit basis.

He can maintain bank transactions with cheque, debit card and credit card, netbariking with the help of Three Column Cash Book. So it will reduce the work burden.

According to J.R. Batliboi "A trial balance is a statement, prepared with the debit and credit balances of the ledger accounts to test the arithmetical accuracy of the books".

(i) Readymade Software
(ii) Customised Software

∴ I^st year depreciation = Rs.7,500
II^nd year depreciation = Rs. 6,375 

i) a) Rs.2,000 spent on additions should be treated as capital expenditure
b) Rs.1200 spent on repairs should be treated as revenue expenditure.
ii) Overhauling expenses are incurred for the engine of a motor car to get better fuel efficiency. So this expenditure should be treated as capital expenditure.

Yes, as the source documents for recording entries in the purchases book are invoices or bills received from the suppliers of goods.

The bank passbook or the bank statement of accounts is prepared by the bank

Correct entry

No, it is not true. Debit does not always mean increase and credit does not always mean decrease. It depends upon the accounts involved.

If bank allows the customer to draw more money from bank account than the actual amount lying in the bank account, then it will have negative balance. Such negative bank balance is called overdraft

No, as per the money measurement concept only those transactions and events, which can be recorded in money terms on the basis of documentary evidences are recorded in books of accounts.

(i) A three column cash book includes three amount columns on both sides, i.e., cash, discount and bank, This cash book is prepared in the same way as simple and double column cash books are prepared.
(ii) Opening balance, cash deposited into bank, cheque deposited in the bank appear in the bank column on the debit side of the three column cash book.
(iii) All the transactions which decrease bank balance are recorded in the bank column on the credit side

The process of analysing the business transactions under the heads of debit and credit and recording them in the journal is called journalising.

(i) The excess of credit total over the debit total is called the credit balance.
(ii) When there is only credit entries in an account, the amount itself is the balance of that account, i.e., the credit balance.

American Accounting Association has defined accounting as "the process of identifying, measuring and communicating economic information to permit informed judgments and decisions by users of the information".