Question

1. Any four differences between Hire Purchase and Installment
purchase system.
2. Limitations of Single entry.
3. Features of Receipts and payment a/c.
4. Partnership Deed.
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Answer 1

1 )When a hirer defaults in the payment of hire charges, the financier has the right to forfeit the money paid till that date and take back the possession of the goods. Whereas in installment purchase, the installment paid are not forfeited and the financier is liable to receive the remaining dues.

2)Limitations of Single Entry:

• Full information about the business cannot be obtained because incomplete records are maintained.
• The arithmetical accuracy of the accounts (i.e., Trial Balance) cannot be tested in the absence of Double Entry.

3)Following are the features of receipt and payment account:

• It is abridged addition of cash book - it is, in effect, a summary of cash book.
• All cash receipts during the whole year are recorded on its left hand (i.e., debit) side. ...
• Cash receipts and cash payments of both capital and revenue nature are recorded here.

4)Partnership deed is an agreement between the partners of a firm that outlines the terms and conditions of partnership among the partners. ... It specifies the various terms such as profit/loss sharing, salary, interest on capital, drawings, admission of a new partner, etc.