#1  
2nd September 2012, 01:39 AM
Sami patel
 
Join Date: Sep 2012
Posts: 1

What are the merits and demerits of single entry system?


What are the merits and demerits of single entry system...pelase tell me




  #2  
20th March 2013, 10:44 PM
kshreyaa
Senior Member+
 
Join Date: Feb 2013
Posts: 823
Default Re: What are the merits and demerits of single entry system?

advantages of the Single Entry System?

A Single Entry system is considered to be the most simplest method to record the financial transaction, only cash book is required no subsidiary books like purchase credit, Sales Credit, Bills Receivable, Bills Payable Book are required so this system proves to be cheaper than Book Entry System.

In order to do the book keeping under the single entry system, no special knowledge is required, only basic knowledge of the accounting is enough so no special technical executives are required to deploy for the accounting purpose. It saves the manpower and its cost for an organziaiton.


Disadvantages Of Single Entry System?

The single entry thus failing to record the two-fold aspects of every business transaction is most incomplete and unreliable in its results and fails to give the necessary information to the trader as to how far his business is profitable or otherwise. The system ignores the two-fold aspects of each and every transaction and as such the records in the ledger are incomplete and partial. Under this system as the two-fold aspects of each and every transaction are not recorded a Trial Balance cannot be prepared to test the arithmetical accuracy of the records. Owing to the absence of Nominal Accounts, Profit and Loss Account cannot be prepared.

In the absence of real and property Account cannot be prepared. In the absence of nominal accounts, profit and loss account cannot be prepared, and the true financial position of the business cannot be ascertained. Any information obtained under the system will not be free from doubt. Should the proprietor want to sell his businesses, it will be a difficult task to fix proper value of various assets, especially of goodwill. In the absence of various checks, which exist in Double Entry System, fraud is more easily committed and is very difficult to detect. In the absence of any reliable information no comparison can be made between one trading periods with that of another.




  #3  
8th July 2015, 08:25 PM
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Default Re: What are the merits and demerits of single entry system?

What are the merites and demerites of single entry system




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