Download the app to get CBSE Sample Papers 2023-24, NCERT Solutions (Revised), Most Important Questions, Previous Year Question Bank, Mock Tests, and Detailed Notes.Install Now
CBSE Accountancy Chapter 10 Accounts from Incomplete Records class 11 Notes Accountancy in PDF are available for free download in myCBSEguide mobile app. The best app for CBSE students now provides Accounts from Incomplete Records class 11 Notes Accountancy latest chapter wise notes for quick preparation of CBSE exams and school based annual examinations. Class 11 Accountancy notes on Chapter 10 Accounts from Incomplete Records class 11 Notes Accountancy are also available for download in CBSE Guide website.
CBSE Guide Accounts from Incomplete Records class 11 Notes
CBSE guide notes are the comprehensive notes which covers the latest syllabus of CBSE and NCERT. It includes all the topics given in NCERT class 11 Accountancy text book. Users can download CBSE guide quick revision notes from myCBSEguide mobile app and my CBSE guide website.
Accounts from Incomplete Records class 11 Notes Accountancy
Download CBSE class 11th revision notes for Chapter 10 Accounts from Incomplete Records class 11 Notes Accountancy in PDF format for free. Download revision notes for Accounts from Incomplete Records class 11 Notes Accountancy and score high in exams. These are the Accounts from Incomplete Records class 11 Notes Accountancy prepared by team of expert teachers. The revision notes help you revise the whole chapter in minutes. Revising notes in exam days is on of the best tips recommended by teachers during exam days.
CHAPTER-10Accounts from Incomplete Records
class 11 Notes Accountancy Learning Objectives
After studying this lesson you will be able to:
· Define the concept of incomplete records.
· Distinguish between Double entry system and Accounts from Incomplete records.
· Ascertain the amount of profit or loss using “Statement of Affairs” method.
· Differentiate between Balance Sheet and Statement of Affairs.
· Prepare Statement of Affairs using given data.
· Illustration Method
· Discussion Method
Some small size business entities do not follow the double entry system of maintaining the accounting records some business entities maintains books of accounts under the system Accounting from Incomplete records. The system in which no set rules of double entry system are followed is called Accounts from Incomplete records.
Under this system only the following accounts are maintained:
· Cash book
· The personal A/C
· ome Real A/C according to need
Note: Nominal accounts are not maintained under this system.
Under this system of maintaining accounts:
· Both the aspects of only certain transactions are recorded e.g. cash
received from debtors or cash paid to creditors.
· One aspect of some transactions are recorded e.g. cash paid for purchase of goods.
· Some financial events are not recorded at all e.g. depreciation charged on fixed assets.
Points to Remember
· Accounting Principles and Accounting Standards are not followed properly under this system.
· Original vouchers provide base for preparing the accounts.
· This method is highly flexible because it can be adjusted according to the needs of the organisation.
· Profit or less is ascertained by either Statement of Affairs method or ‘Conversion into Double Entry System Method.’
Uses of Incomplete Records
Books according to this system can be maintained only by those small entities in the form of Sole Proprietorship or Partnership firms that are not bound to keep records of business transactions as per double entry system. Companies cannot maintain books under this system because of legal provisions.
Uses or Reasons for Keeping Incomplete Records
1. Simple Method: It is an easy and simple as under this method one does not require any special knowledge of the principles for recording of transactions.
2. Less Expensive: As under this method only few accounts are prepared therefore business firm does not require more statt for recording the transactions
3. Flexible Method: This method is highly flexible because it can be adjusted according to the needs of the organisation.
4. Suitable for Small Concerns: This method is most suitable to small business concerns which have mostly cash transactions and very few Assets & Liabilities
Limitations of Incomplete Records
1. Incomplete method: This method is incomplete method of maintaining the accounting records as the aspects, debit and credit, of every transaction are not recorded.
2. Arithmetical Accuracy cannot be checked: Under this system no real and nominal accounts are maintained. As such a trial balance cannot be prepared to check the arithmetical accuracy of the books of accounts.
3. True Profit or Loss cannot be ascertained: As under this system all the accounts are not prepared like Nominal A/C which is the base for calculating actual profit. So the profit ascertained under this method is not reliable.
4. True financial position of the business cannot be Judged: Since real accounts are not maintained, it is not possible to prepare a balance sheet showing the true financial position of the business
5. No recognition in the assessment of Income Tax & Sales Tax: The system fails to reveal the true profit and sales of a business. As such, the accounts maintained under the system are not accepted by Tax authorities.
Ascertainment of Profit or Loss
The main objective of any business enterprise is to earn profits In case of organizations maintaining accounts under incomplete records the amount of profit or loss can be ascertained by Statement of Affairs method or Net Worth method
Statement of Affairs Method
Under this method, profits or losses of the business are ascertained by comparing the Capital at the end, Capital at the beginning of the accounting period.
1.When Capital at the end is more than the capital in the beginning during an Accounting period
Profits = Closing Capital – Opening Capital
2. When Capital at the Beginning is more than capital at the end during an Accounting Period.
Losses = Opening Capital – Closing Capital
For ascertainment of profit or loss, the following steps shall be taken:
Step 1: Calculate the amount of ‘Opening capital’ (If not given in the Question) by preparing Statement of Affairs at the beginning of the accounting period.
Step 2: Calculate the amount of ‘Closing Capital’ by preparing ‘Statement of Affair’ at the end of the accounting period.
Step 3: Calculation of Profit or Loss by preparing Statement of Profit of Loss in the following manner
Statement of Profit or Loss for the year ended on ….
|Add:- Drawing during the year||XXXX|
|Less:- Additional Capital introduced during the year||XXXX|
|Adjusted Capital at the end||XXXX|
|Less:- Opening Capital||XXXX|
|Profit or Loss for the year||XXXX|
STATEMENT OF AFFAIRS
A Statement of affairs is a statement showing the balances of assets (including cash and bank balance) on the right hand side and the balance of liabilities on the left hand side, on a particulars date. The difference in the total of two sides is known as capital.
Capital = Total Assets – Total liabilities
A statement of affairs is very similar to Balance Sheet as prepared for the business entities maintaining accounts under double entry system, though it should not be described as a Balance Sheet.
A Statement of Affairs is prepared as follows:
Statement of Affairs
as at …………………………..
|Bank overdraft||XXXX||Cash in Hand||XXXX|
|Sundry Creditors||XXXX||Cash at Bank||XXXX|
|Bill Payable||XXXX||Bills receivables||XXXX|
|Outstanding Expenses||XXXX||Sundry Debtors||XXXX|
|Income recd in advance||XXXX||Stock||XXXX|
|Capital (Balancing Figure)||XXXX||Accrued Income||XXXX|
Accounts from Incomplete Records class 11 Notes
- CBSE Revision notes (PDF Download) Free
- CBSE Revision notes for Class 11 Accountancy PDF
- CBSE Revision notes Class 11 Accountancy – CBSE
- CBSE Revisions notes and Key Points Class 11 Accountancy
- Summary of the NCERT books all chapters in Accountancy class 11
- Short notes for CBSE class 11th Accountancy
- Key notes and chapter summary of Accountancy class 11
- Quick revision notes for CBSE exams
CBSE Class-11 Revision Notes and Key Points
Accounts from Incomplete Records class 11 Notes Accountancy. CBSE quick revision note for class-11 Mathematics, Physics, Chemistry, Biology and other subject are very helpful to revise the whole syllabus during exam days. The revision notes covers all important formulas and concepts given in the chapter. Even if you wish to have an overview of a chapter, quick revision notes are here to do if for you. These notes will certainly save your time during stressful exam days.
- Revision Notes for class-11 Physics
- Revision Notes for class-11 Chemistry
- Revision Notes for class-11 Mathematics
- Revision Notes for class-11 Biology
- Revision Notes for class-11 Accountancy
- Revision Notes for class-11 Economics
- Revision Notes for class-11 Business Studies
- Revision Notes for class-11 Computer Science
- Revision Notes for class-11 Informatics Practices
- Revision Notes for class-11 Geography
To download Accounts from Incomplete Records class 11 Notes, sample paper for class 11 Chemistry, Physics, Biology, History, Political Science, Economics, Geography, Computer Science, Home Science, Accountancy, Business Studies and Home Science; do check myCBSEguide app or website. myCBSEguide provides sample papers with solution, test papers for chapter-wise practice, NCERT solutions, NCERT Exemplar solutions, quick revision notes for ready reference, CBSE guess papers and CBSE important question papers. Sample Paper all are made available through the best app for CBSE students and myCBSEguide website.
- Introduction to Accounting class 11 Notes Accountancy
- Theory Base of Accounting class 11 Notes Accountancy
- Recording of Transactions-I class 11 Notes Accountancy
- Recording of Transactions-II class 11 Notes Accountancy
- Bank Reconciliation Statement class 11 Notes Accountancy
- Trial Balance and Rectification of Errors class 11 Notes Accountancy
- Depreciation, Provisions and Reserves class 11 Notes Accountancy
- Bill of Exchange class 11 Notes Accountancy
- Financial Statements – I class 11 Notes Accountancy
- Financial Statements – II class 11 Notes Accountancy
- Accounts from Incomplete Records class 11 Notes Accountancy
- Computerized Accounting System class 11 Notes Accountancy
Create question paper PDF and online tests with your own name & logo in minutes.Create Now
Question Bank, Mock Tests, Exam Papers, NCERT Solutions, Sample Papers, NotesInstall Now