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Accounts From

Incomplete
Records
( Single Entry System )
Presented by:-
Jaishree Asnani
Roll no. 110065
Definition:-

 Itis an incomplete, inaccurate, unscientific and


unsystematic system of book keeping.

According to “Kohler” single entry is a “system


of book-keeping in which as a rule only records
of cash and personal accounts are maintained, it is
always incomplete double entry varying with
circumstances”.
Features of single entry system
 Incomplete, unscientific and unsystematic system
of accounting.
 Only personal accounts are prepared.
 Limited use
 Profit under system is only an estimate
 True financial position cannot be ascertained as

Balance Sheet is not prepared.


 Cash book maintained mixes cash and credit

transactions
Advantages
Simple method.
Economical.
Economy of time.
Useful for small firms.
Tax evasion.
Disadvantages
 Incomplete and Unscientific
Methods
 Trial Balance is not prepared
 No knowledge of financial position
 Control over assets is not possible
 Unacceptable to tax authorities
 Difficulty in obtaining loans
Difference between single entry and double entry
Basis Single entry system Double entry system
1.Double aspect Double aspect of Double aspect of
transaction are not transaction are recorded in
recorded in it. it
2.Types of Only personal accounts Personal, Real and Nominal
accounts are prepared accounts are prepared
3.Trial Balance Trial balance is not Trial balance is prepared to
prepared so arithmetical check arithmetical accuracy
accuracy cannot be
checked

4.Net Income
It is only an estimate of Actual net profit is
profits calculated
5.Suitability Suitable for sole trader, Suitable for all business
who has got lesser number enterprises whether sole
of transactions and that trade or partnership or
too only of cash nature companies
Methods of estimating profit under Single Entry System

1. Statement Of affairs Method or


capital comparison Method.
2. Conversion method or Conversion
of Single Entry into Double Entry
System
Statement of Affairs Method
Statements made
 Statement of Affairs
 Statement of Profit And Loss
 Revised Statement of Affairs
Statement Of Affairs
Amount (Rs) Amount (Rs)
Liabiliti 1-1-08 31-12-08 Assets 1-1-08 31-12-08

es Overdraft
Bank ……. ……. Cash at
bank \hand
……. …….
Bills Payable ……. …….
Income Accrued ……. …….
Creditors ……. …….
Prepaid
……. …….
Outstanding Expenses
……. ……. …….
Expenses Debtors …….
Capital Bills ……. …….
(balancing figure) Receivables
……. …….
……. ……. Stock
Furniture ……. …….
Building ……. …….

……. ……. ……. …….


Statement of Profit And Loss
Particulars Amount
Capital at the end of the year (Rs)
Add: Drawings
Less: Additional Capital

Less: Capital at the beginning of the year


P
Less: Bad debts
: Depreciation
: Outstanding Expenses
: Other Expenses
Add: Prepaid expenses
: Other Incomes

Profit Earned During The Year/ Net Profit


Revised Statement of
Affairs
Liabiliti ( as on
Amount ……….)
Assets Amount
(Rs) (Rs)
es Overdraft
Bank ……. Cash at
bank \hand
…….
Bills Payable …….
Income Accrued …….
Creditors …….
Prepaid
Outstanding …….
……. Expenses
Expenses Debtors …….
Capital Bills …….
Less: Drawings Receivables
Add: Additional Capital …….
……. Stock
Add: N\P Furniture …….
Building …….

……. …….
Statement of Affairs
( as on ……)
Amount (Rs) Amount (Rs)
Liabiliti 1-1-08 31-12-08 Assets 1-1-08 31-12-08

es
Bank Overdraft
Bills Payable
---- 3350
200
Cash at bank 4350 …….
1000 Debtors 12000 14000
Creditors 9000 1500
Bills 5000
4000
Capital 41650 49950 Receivables
(balancing figure) 18700 23400
Stock
Furniture 600 600
Building 12000 12000

51650 55000 51650 55000


Statement of Profit & Loss
(as on 31st December)

Capital as on 31st December 2009 49950


Add: Drawings 7520
57470
Less: Capital at the beginning of the year 41650
15820
Less: Provision For Bad and doubtful debts:(1450)
: Depreciation on Building :( 600)
: Depreciation On Furniture :( 30)
: Outstanding Salaries :(1200)
: Outstanding Wages :(3000)
: Outstanding Legal Expenses :( 700) 6980
8840
cont.

8840
Add: Prepaid Insurance : 250 250

Profit Earned During The Year/ Net Profit 9090


Revised Statement Of affairs
( as on 31st Dec. 2009 )

Liabiliti Amount Assets Amou


es Overdraft
Bank 3350 Debtors 14000 nt
12550
Bills Payable 200 Less: Provision 1450
Creditors 1500 Bills Receivables 5000
Outstanding Expenses Stock 23400
Wages: 3000
Salaries: 1200 Furniture 600
Legal Expenses: 700 4200
Less : Dep 30 570
Capital
Building 12000
Less: Drawings 7520
Less : Dep 600 11400
Add: N\P 9090 43220
Prepaid Expenses 250

53170 53170
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Thank you
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