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Q1. Distinction between book-keeping and accountancy

Accountancy is the profession and the practitioners of accountancy are called accountants. Book keeping is the basic activity of recording. On recording the transactions and events in the books of accounts, accounting does the role of analysis and reporting. Accountancy is the profession of carrying the activities of book keeping and accounting. Accounting enjoys wider scope and includes not only book keeping but also analysis, interpretation and reporting of financial information.
The later part of accounting is the core function of accounting. In the present day environment, sophisticated software packages are available, which facilitate entry of transactions and preparation of ledger accounts.
Traditionally, the records were kept in a book, hence the name bookkeeping. These days, bookkeeping is normally performed using a bookkeeping software package, but the names of the books (daybook, cashbook, journal, and ledger) are still used.A bookkeeper's function is primarily one of recording transactions in the journal and posting to the ledger, and is sometimes referred to as an accounts clerk.
There are two types of bookkeeping: single entry and double-entry. In single entry bookkeeping, the record of each transaction is carried to either the debit or credit column of a single account. In double-entry bookkeeping, two entries of each transaction are carried to the ledger: one to the debit side, and one to the credit side, of the corresponding account. This is so the two entries can be used to check each other.

Book keeping
· It is a process of identifying, measuring, recording and analyzing the transactions in books of accounts
· It involves summarizing the classified transaction, interpreting the analyzed results and communicating the information to the users of financial statement.
· Adopt principles of accounting for recording
· Analyzing and interpreting requires skill, knowledge and experience
· Book keeping is the first stage of accounting process
· Accounting follows book keeping. It is the secondary stage
· The objective is to prepare final accounts and balance sheet in a systematic manner at the end of accounting period
· The objective is to ascertain net results of financial operations and communicate the results to all stakeholders in a manner they understand.
· Accounts executives who perform this function may not require higher level of knowledge.
· Accountants who perform this function need higher analytical skills to interpret the data and to take appropriate decisions.
· The nature of job is routine and clerical
· The nature of job is non routine but analytical.


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