Question

what is a single entry system? what are its drawback? explain the two method of ascertaining profit when accounting record are incomplete.

Answer 1

Under single entry system there is no entries in the General Journal.  Only once sided payable or receivable or cash payment or cash receipt transaction are being recorded by the sole owner of the business.  single entry system is used in sole proprietorship of small business.

We can calculate actual profit of loss and correct Balance sheet under this system.