(i) Accounting Conventions:
1. The word convention refers to traditions or customs. The accounting convention describes the customs or traditions followed as a guide to the preparation of accounting statements.
2. Modern business world has accepted the utility of these Accounting conventions in making financial statements more realistic, reliable, and useful to all concerned parties. The following four conventions are generally adopted over a period of time.
(ii) Convention of consistency:
1. The consistency convention implies that the Accounting practice should remain the same from one year to another. The results of different years will be comparable only when same accounting methods are followed from year to year.
2. For Example: If a firm follows the original or fixed installment method of charging depreciation since its purchase/construction, the method should be followed without any change.
(iii) Convention of full disclosure:
1. The accounts must disclose all material information. The Accounting reports should disclose full and fair information to the related parties. The financial position and performance should be disclosed very honestly to all the users.
2. All the information should be relevant, reliable, comparable and understood by all the concerned authorities.
(iv) Convention of conservatism or prudence:
It is a policy of caution or playing safe. While recording the business transactions one has to anticipate no income but provide for all possible losses.

There are three bases of accounting in common usage, namely
(i) Cash basis
(ii) Accrual or mercantile basis
(iii) Mixed or hybrid basis
(i) Accounting on cash basis:
1. Under cash basis of accounting, actual cash receipts and actual cash payments are recorded.
2. Credit transactions are not recorded till the cash is actually received or paid.
3. Under the basis,
a) Any income received  
b) Any expenditure paid  
c) Any asset purchased for which cash is paid.
d) Any liability paid during the accounting period. Whether related to the past, present or future is taken into account.
(ii) Accrual or mercantile basis :
1) Under accrual basis of accounting, the income whether received or not but has been earned or accrued during the period and expenses incurred whether paid or not are recorded.
2) Under this basis,
a) Any income earned whether received or not
b) Any expenditure incurred whether paid or not
c) Any asset purchased whether cash is paid or not
d) Any liability incurred whether paid or not during the accounting period is recorded.
(iii) Hybrid or mixed basis :
1. Under mixed basis of accounting both cash basis and accrual basis are followed.
2. Incomes are generally recorded on cash basis whereas expenses are generally taken on accrual basis.

The various branches of accounting are

(i) Financial Accounting :
1. It involves recording of financial transactions and events.
2. It provides financial information to the users for taking decisions.
3. It ends up with the preparation of trading and profit and loss account and balance sheet,
(ii) Cost Accounting :  
It involves the collection, recording, classification and appropriate allocation of expenditure for the determination of the costs of products or services and for the presentation of data for the purposes of cost control and managerial decision making.
(iii) Management Accounting :
It is concerned with the presentation of accounting information in such a way as to assist management in decision making and in the day - to - day operations of an enterprise.
(iv) Social Responsibility Accounting :
It is concerned with presentation of accounting information from the view point of the society by showing the social costs and social benefits.
(v) Human Resource Accounting :
It is concerned with identification, quantification, and reporting of investments made in human resources of an enterprise.

A trial balance can be prepared in the following methods.
(i) Balance method: In this method, the balance of every ledger account either debit or credit, as the case may be, is recorded in the trial balance against the respective accounts. This method is widely used.
(ii) Total method: Under this method, the total amounts on the debit side of the ledger accounts and the total amounts on the credit side of the ledger accounts are ascertained and recorded in the trial balance. This is not commonly used.
(iii) Total and balance method: This method is a combination of both total method and balance method. Under this method, four columns are provided namely (a) total of debit side of the ledger accounts (b) total of credit side of the ledger accounts (c) debit balances of ledger accounts and (d) credit balances of ledger accounts. This method is not in practice.

Under the accrual basis of accounting, the revenue whether received or not, but has been earned or accrued during the accounting period and expenses incurred whether paid or not are recorded. In other words, revenue is recognised, when it is earned or accrued and expenses are recognised when these are incurred. Under this basis,
a) Any income earned whether received or not
b) Any expenditure incurred whether paid or not
c) Any asset is purchased when cash is paid or not
d) Any liability incurred whether paid or not during the accounting period is recorded.

(i) Heavy cost of installation:
Computer hardware needs replacement and software needs to be updated from time to time with the availability of newer versions.
(ii) Cost of training:
To ensure effective and efficient use of computerised system of accounting, newer versions of hardware and software are to be introduced.
(iii) Fear of unemployment:
On account of the introduction of computerised accounting system, the employees feel insecure that they may lose employment and show less interest in computer related work.

Procedure
i) Open a new spread sheet in MS-Excel.
ii) Enter the data in cells from A1 to J2 as in the question
iii) To get the Number of cells containing numbers only, write the formula in B3
= COUNT(A1:J2)
iv) To get Number of cells that contain any value, write the formula in B4
= COUNTA(A1:J2)
v) To get the Number of cells which have values exceeding 1000, write the formula in B5
= COUNTIF(A1:J2,”>1000”)
Answer
A) 12 B) 18 C) 2 b) Text functions

Following are the objectives of book-keeping :
(i) To have a complete and permanent record of all business transactions in chronological order and under appropriate headings.
(ii) To facilitate ascertainment of the profit or loss of the business during a specific period.
(iii) To facilitate ascertainment of financial position.
(iv) To know the progress of the business.
(v) To find out the tax liabilities.
(vi) To fulfill the legal requirements

(i) "Business units last indefinitely". This statement is used in Going Concern Concept.
(ii) Going concern concept influences Accounting practices in relation to valuation of assets and liabilities, depreciation of the fixed assets, treatment of outstanding and prepaid expenses and Incomes.
(iii) The values involved in the going concern concept are
1. Growth: By following the going concern concept, business activities are to be carried out for future growth. 
2. Preparing for future: By following the going concern assumption, business firm always intends to prepare for the future.

This system is not suitable for all business because the actual profit or loss can not be found out by this system. If it is a small business only can follow this system.

i) Convention of consistency
ii) Convention of full disclosure
iii) Convention of materiality
iv) Convention of conservatism or providence.

(i) Readymade Software
(ii) Customised Software

Amount of depreciation per year = \(Original\ cost\ of\ the\ asset − Estimated\ scrap\ value\over Estimated\ useful\ life\ of\ the\ asset\ in\ years\)
\(={1,90,000 – 15,000\over 10}={1,75,000\over 10}\) = Rs.35,000 per year

(i) Under this method, the amount spent on the purchase of an asset is regarded as an investment. As such, the interest at a certain rate is calculated on the opening balance of the asset account each year and debited to the asset account.
(ii) The amount of depreciation written off is ascertained by- referring to the annuity table. Annual depreciation is uniform throughout the working life of the asset.

The following are the different methods of providing depreciation:
(i) Straight line method or Fixed instalment method or Original cost method
(ii) Written down value method or Diminishing balance method
(iii) Sum of years of digits method
(iv) Machine hour rate method
(v) Depletion method
(vi) Annuity method
(vii) Revaluation method
(viii) Sinking fund method
(ix) Insurance policy method

(i) An expenditure, which is revenue expenditure in nature, the benefit of which is to be derived over a subsequent period or periods is known as deferred revenue expenditure.
(ii) The benefit usually accrues for a period of two or more years.
(iii) It is for the time being, deferred from being charged against income.

i) Capital expenditure
ii) Revenue receipt
iii) Capital expenditure
iv) Capital receipt.

Trial balance is a Statement, showing the names and balances of all the accounts in the ledger and cash book.

(i) Cash Basis of Accounting
= 4,50,000 - 2,00,000 (3,50,000 - 1,50,000)
= Rs. 2,50,000
(ii) Accrual Basis of Accounting
= 4,50,000 + 3,00,000 - 3,50,000
= Rs. 4,00,000

There are three parties to a bill of exchange as under:
(i) Drawer: The person who prepares the bill is called the drawer i.e., a creditor
(ii) Drawee: The person who has to make the payment or who accepts to make the payment is called the drawee i.e., a debtor.
(iii) Payee: The person who receives the payment is payee. He may be a third party or the drawer himself.

(i) Financial Accounting involves recording of transactions and events which are financial in nature.
(ii) It provides financial information to the users for taking decisions
(iii) It ends up with the preparation of trading and profit and loss account and balance sheet.