Question

2. Distinguish between Book-Keeping and Accountancy.

Answer 1

Answer:

Bookkeeping:The purpose of bookkeeping is to maintain a systematic record of financial activities and transactions chronologically.

Accounting : The purpose of accounting is to report the financial strength and obtain the results of the operating activity of a business.

Explanation:

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Answer 2

ANSWER :

$\: \: \: \: \: \: \: \: \: \: \: \:$ Book-keeping and Accountancy are two most important terms of commerce and business. Though these two terms have some similarities, one should not be confused by considering the terms as same.

★ Distinguish between Book-keeping and Accountancy are mentioned below :-

• (i) Definition : According to J. R. Batliboi, "Book-keeping is the art of recording business dealing in a set of books." On the other hand, according to F. W. Pixley, "Accountancy is the science which deals with recording of monetary transactions of every description."

• (ii) Objective : The objective of book-keeping is to record the transaction in the books of accounts. Whereas, the objective of accountancy is to provide the methods, procedures and ways for accounting as well as book-keeping.

• (iii) Scope : The scope of book-keeping is limited as it is mainly concerned with recording and preservation of transactions. But the scope of of accountancy is wider as it covers both book-keeping and accounting.

• (iv) Usefulness : Book-keeping is useful for recording and classification of transaction, though no significant managerial decision or managerial use can be made out of it. On the other hand, accountancy refers to a systematic knowledge of accounting with the principle and techniques of application in accounting, therefore it is useful for taking business decisions.