IGNOU B.COM 1ST YEAR FINANCIAL ACCOUNTING ASSIGNMENT BCOC-131 

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Q.- 8 Discuss the factors that must be taken into consideration for determining the amount of

depreciation?

Ans- Depreciation refers to decrease in the value of asset during a particular period. According to their  term and policy method a company must adopt the method of depreciation.

The following are the main factor which are affect the depreciation of an asset.

1- Cost of the asset -. The cost of a fixed asset is determined after adding all expenses incurred for

bringing the asset to a usable condition.

2- Estimated Life of an asset-. Useful Life of an asset is estimated in term of number of years. It can be effectively used for business operation.

3- Estimated scrap value-. It is estimated sale value of an asset at the end of its useful life. It is also

known as residual value or break-up value.

4- Method of depreciation- different methods are suitable for different assets belonging upon the

it’s nature and type. It is devised various methods for depreciation

.

5- Legal provisions regarding rate-. There are various provisions regarding rate of depreciation.it

depends upon the provisions of an organisation to be suited a rate of depreciation for the asset.

6- Obsolescence-. Due to new invention and improved technology old asset become obsolete and may have to be discarded. The obsolescence of a asset is also factor to depreciation.

Q-9 What is the salient features of joint venture? Explain.

Ans- Meaning- it is the process In which a commercial enterprise undertaken jointly by two or more parties which otherwise retained their distinct identities. In a joint venture the two partners can be form same sector also like joint venture between two government , between two public sector unit, between two private partner.

Features- the following are the main features of joint venture:

1- It is formed by by two or more parties.

2- The purpose of joint venture is only to be executed a particular project or venture.

3- The nature of joint venture is temporary because it is established for specific task.

4- The profit of joint venture is share in the agreed ratio. The loss of joint venture also distributed among the co- venture

5- There is no need of name of a specific firm to form the joint venture business.

6- During the tenure of joint venture , co- venture are free to continue with business.

Q-10 What are Post dated voucher? Explain the uses of post dated voucher.

Ans- Meaning- while entering voucher you can make them as Post dated as a result these vouchers are not updated in the ledger till the date specified in the voucher, this is useful for entering transactions that take place on regular basis.

Uses of post dated voucher:

1- It is used by a company.

2- Entered with a specific date and get automatically updated into account on mentioned

date.

3- These kinds of voucher are used to make multiple entries easier.

4- It is used to show the discount rate or exchange rate.

5- It help in maintaining the record by automatically feeding the information.it allows

entries to be made easier.

Q-11 Distinguished between the following

A. Cash basis of accounting and accrual basis of accounting

B. trading account and manufacturing account

Ans        Basis of difference

1- Recording of transaction- cash basis of accounting records only cash transactions while accrual basis of accounting is a complete record of cash as well as credit transaction

2- Recording of income- cash basis of accounting only those income are recorded which receives in cash on the accrual basis of accounting all income are recorded whether cash received or not.

3- Recording of expenses- as per the cash basis only those expenses are recorded which receives in cash.as per accrual basis all expenses are recorded whether cash is paid or not.

4- Distinction between capital and revenue- cash basis of accounting doesn’t make a difference between capital and revenue items on the accrual basis makes a distinction between capital and revenue.

5- Suitable- cash basis of accounting is suitable for professional people. On accrual basis of accounting is adopted by enterprise with profit motive.

B   Basis of difference

1- Object- manufacturing account is prepared to ascertain the cost of the goods manufactured. Trading account is prepared to ascertain gross profit or gross loss.

2- Stage- manufacturing account is first stage of final account trading account is second stage of final account.

3- Opening and closing stock- in the manufacturing account opening and closing stock of raw material and semi finished goods are shown.in the trading account opening and closing stock of the finished goods are shown.

4- Balance- the balance of manufacturing account is transferred to trading account the balance of trading account is transferred to profit and loss account.

5- Prepared by- manufacturing account is prepared only by manufacturer trading account is prepared by all business man including manufacturers.

Q-12 Write short note on following

A Cash book maintaining

B preparation of report

Ans a. –

                      Generally petty cash book is maintained on imprest system. Under this system an estimate is made of the amount required for petty payment for a certain period. Say a week or a month. This amount is handed over to the petty cashier in advance. The petty cashier is required to obtain voucher for all expenses be incur. At the end of the period the petty cashier present the petty cash book together with the voucher to the chief cashier. The chief cashier verify the entry in petty cash book and pay to the petty cashier a sum equal to the amount spent by him. The original amount of the petty cash with which the petty cashier had started is restored. This system of advance payment and reimbursement the amount spent from time to time is called imprest system.

B-:         

       After recording transaction tally help user to view different report to assess the financial health and performance of the firm. As soon as the transaction are entered into tally the preparation of report is done by tally automatically all crucial and important financial statements like balance sheet, profit and loss, stock summary, trial balance., day book etc. The users can reach to the transaction level from report by pressing enter key on the required item. The report can be customized as per user need. The preparation of report is the last step in tally.

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