Ans:- “ Management Accounting is concerned with accounting information that is useful to Management”. “ Such of its techniques and procedures by which accounting mainly seeks to aid the management collectively have come to be known as management Accounting”.
2. What is Convention (principle) of Consistency?
Ans:- “ The consistency requires that once a company had decided on one method, it will treat all subsequent events of the same character in the same fashion unless it has a sound reason to do otherwise”. If there is any change, its effect should be clearly stated in the financial statements.
3. What is revenue expenditure?
Revenue expenditure are Recurring in nature. The amount of expenditure is small.
4. What do you mean by Accounting cycle?
Ans:- The accounting cycle is a periodic process by which a firm's financial position - as expressed in the accounting records - is formally updated to summarize transactions that have been recorded during the accounting period. Much of the fundamental terminology of accounting is related to the accounting cycle. Basic accounting terms related to the accounting cycle include:
Journal, Ledger, Debit, Credit, Normal Balance, Posting, Temporary account, permanent account, Contra account, Adjusting entry, Book value, Trial balance, Pre-closing trial balance, Closing entry, Post- closing trial balance, Reversing entry.
5. Give Four examples of intangible asset?
Good will, copy rights, patents (exclusive rights), Royalty.
6. What is the formula for calculating average collection period?
Average collection period =_______365________________
Debtor Turn over = Sales / Debtor
7. How cash flow statement is different from fund flow Statement ?
Fund flow statement Cash Flow statement
1. It is dynamic in nature... [continues]
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