Unit No. 1 Introduction to Book-keeping & Accountancy Transaction Types of Transaction Monetary Transactions Non-Monetary Transactions Book-keeping Scientific Method Introduction Meaning of Book-Keeping Definition of Book-Keeping Features of Book-keeping Objectives of Book-keeping Importance of Book-keeping Utility of Book-keeping

1. Presented by :- Mr. Sunil Musale.
(M.Com.,B.Ed.,SET,GDC&A)
PRESENTATION – 2
Subject – Book-keeping & Accountancy
Class- 11 (Commerce)
Mobile No.- 9763388734, 9860853463.
E-Mail- sunilmusale143@gmail.com

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Transaction
Exchange of goods and services between two persons
or parties for money or money's worth is known as
Transactions.
Types of Transaction

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Monetary Transactions
The transaction which involves an exchange of money or money’s
worth directly or indirectly is called monetary transactions. Only monetary
transactions are recorded in the books of accounts.
1) Cash Transactions : A business transaction in which cash is paid or
received Immediately is known as cash transaction. e.g i) Purchase of goods
for cash at ₹ 15,000/- ii) Payment of salary at ₹ 5,000/-.
2) Credit Transactions: A credit transaction is one in which cash is not
paid or received immediately at the time of a transaction but it is paid or
received at a later date. e.g i) Goods sold on credit to Mr. Aman at ₹8,000/-
ii) Sold machinery to Mr. Amar Singh on credit at ₹ 20,000/-.
Non-Monetary Transactions
The transaction which does not involve an exchange of money or
money’s worth directly or indirectly are called Non-monetary transactions.
An exchange of one thing against another thing is called as Barter
transactions.

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It is not possible for anyone to remember all
transactions. But Book-keeping maintains records of
all the transactions permanently and systematically
(Scientific) in the books of accounts.
In the year 1494, Luca De Bargo Pacioli, an Italian
merchant introduced Double-Entry Bookkeeping
system.

5. Introduction
Book-keeping is related with recording of
business transactions. Business enterprise and other
organizations deal in activities which involve exchange
of money or money’s worth. All these activities are
recorded for the purpose of taking important decisions
as to whether the activities are feasible, profitable and
are to be continued or not. Information about the
business and other organizations is required not only
by the proprietors and managers of business and other
organisations but also to various other stakeholders
such as the government, investors, customers,
employees and researchers.
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Introduction

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Meaning of Book-Keeping
In simple words, the ‘Book-keeping’ means recording of the
business transactions in the books of accounts in a systematic way.
All the monetary transactions are recorded date wise for accurate
business results from such records at the end of accounting year.
Book-keeping is an art or science of systematic recording,
classifying and summarising the financial transactions of business
for a particular period, generally one year.
Definition of Book-Keeping
J. R. Batliboi : “Book-keeping is an art of recording business
dealings in a set of books.”
Nocth Cott: “Book-keeping is an art of recording in the books of
accounts the monetary aspects of commercial or financial
transactions.”
R.N. Carter : “Book-keeping is the science and art of correctly
recording in the books of accounts, all those business transactions
that results in transfer or money or money’s worth.”
Meaning of Book-Keeping
Definition of Book-Keeping

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1) It is the method of recording day to day business transactions.
2) Only financial transactions are recorded.
3) All records are prepared for a specific period which are useful for
future references.
4) Records of transactions are based on rules and regulations.
5) It is an art of recording business transactions scientifically.

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1) The main objective of book-keeping is to keep a complete and accurate
record of all the financial transactions in a systematic, orderly and logical
manner.
2) All the business transactions are to be recorded date wise and account wise.
3) Book-keeping serves as a permanent record of the monetary transactions of
an enterprise business and it can be produced as an evidence, whenever and
wherever required.
4) To know the profit or loss of the business during the financial year.
5) To know the total assets and liabilities of the enterprise.
6) To know what the businessman owes to others and what others owe to him.
7) Businessman comes to know the current year’s progress over previous year
and compares its financial results with other business enterprise in similar line.

9.  1) Record : It is not possible for anyone to remember all
transactions. But Book-keeping maintains records of all the
transactions permanently and systematically in the books of
accounts.
 2) Financial Information: Book-keeping is useful to get
information related to Profit, Loss, Assets, Liabilities,
Investments and Stock, etc, at any given time.
 3) Decision Making: Book-keeping provides financial information
to the businessman for decision making.
 4) Controlling: Book-keeping enables the executives of the
business to control the activities of the business.
 5) Evidence: Businessman needs financial evidence to be
produced in the Court of law in case of any disputes.
 6) Tax Liability: Book-keeping is useful to find out the tax
liabilities e.g. : Income Tax, Property Tax, GST, etc.
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1) Owner: The businessman can find out Profit, Losses, Assets and
Liabilities of an enterprise at any time.
2) Management: Management of an enterprise can plan, take
decisions and control overall business activities.
3) Investors: Investors can take proper decisions whether to invest or
not.
4) Customer: Customer can easily understand financial position of the
business. He can be assured about supply of goods.
5) Government: Government can easily find out different types of
taxes due from various sources.
6) Lenders: Money Lenders can find financial standing of the
enterprise for decision to lend money or not.
7) Development: Business enterprise can achieve the business growth
with the help of accounting.

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