Accounting Systems and Financial Statements
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Questions and Answers

What is the primary distinction between a single entry system and a double entry system?

  • The method of recording transactions (correct)
  • The number of entries made in the ledger
  • The type of accounts used in the system
  • The level of accuracy required in the system

    • What is the purpose of calculating capital at the end and at the start of a period?

  • To determine the net profit or loss
  • To calculate the cash and bank balance
  • To prepare the statement of financial position
  • To determine the change in the owner's equity (correct)

    • What is the main difference between a statement of affairs and a statement of financial position?

  • The date of preparation of the statement
  • The type of accounts included in the statement
  • The purpose of preparing the statement (correct)
  • The format of presentation

    • Which method of accounting combines features of both single entry and double entry systems?

    <p>Mixed entry system</p> Signup and view all the answers

    What is the key feature of a statement of profit or loss prepared by the pure single entry method?

    <p>It is prepared from the statement of affairs</p> Signup and view all the answers

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