Accounting systems is composed of Budgetary Accounts system, Receipt/ Income and deposit system, Disbursement System, Financial reporting systemSelect one:TrueFalse

Sales, purchasing, and shipping documents are all considered examples of to an accounting system.

Accounting SystemsThere are five questions associated with this passagePeople typically use two types of accounting systems: a cash-based system and an accrual system. Several things need to be considered when choosing an accounting system. The two most important considerations are ease of use and need for accuracy.In a cash-based system, which is easy to use, you record transactions when the money is actually paid or received.An accrual accounting system is more difficult to understand, but it is more accurate than a cash-based system. In an accrual system, a transaction is recorded when you receive or provide a product or service, not when you pay or receive payment for the product or service.Assume you provided a service to a customer for $1,000 in May and received payment for it in June. You also purchased and received a $2,000 piece of equipment in May and paid for it in June.Under an accrual accounting system, in May you would record both the $1,000 for the service performed and the $2,000 for the equipment purchased. Under a cash-based system, in June you would record both the $1,000 payment received and the $2,000 payment made.The cash-based accounting system would give you an incorrect picture of your true financial status in May. It would appear that you had $1,000 more in cash than you actually did. Therefore, an accrual accounting system would provide a more accurate picture of how you are doing financially at any given point in time.What is the best reason to use an accrual accounting system?It is easy to use.It is easy to understand.It shows your real financial status.It is used by most people.It requires minimal effort.

Which of the following systems is the Accounting Equation based on?Triple-entry system of accountingSingle-entry system of accountingDouble-entry system of accountingNone of the above

Accrual basis of accounting is a system where:Question 5Answera.The receipts are recorded when cash is not received while expenditures are recorded only when cash is paidb.The receipts are recorded only when cash is received while expenditures are recorded only when cash is paidc.Revenue is recorded when there is commitment and expenditure recorded when services is received.d.Revenue recorded when earned and expenditures recorded when benefits are received

Difference between Management and Financial accounting Management Accounting Financial AccountingInformation usually/mainly produced for Internal use e.g. managers and employees External use e.g. stake holder, payable, lender, banks, government etc.Purpose of Information To aid planning, controlling and decision making. To record the financial performance in the period and the position at the end of that period.Legal Requirement None Limited companies must provide financial accountsFormats Management decide on the information they require and most useful way of presenting it. Formats and contents of financial accounts intended to give true and fair view, should follow accounting standards and company law.Nature of information Financial and Non- financial Mostly financial Time period Historical and forward working Mainly a historical researchExplain this in detail by making table and please use easy wording because i am not good in English and also give each example