Question

Only financial transactions are recorded in accountancy explain the statement

Answer 1

It is an inherent limitation of accounting that we record only those transactions which are financial in nature and which can be measured in terms of money. For instance, value of human resources, change in managerial policies,dispute between production and sales personnel are the examples which affect the profitability of the business adversely. Though these are financial matters yet their impact can not be measured in terms of money precisely so these will not recorded in the books of accounts.

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Answer 2

"Only financial transactions are recorded in accountancy" means that only cash transactions are recorded in accounts books.