Page 21 - Book-keeping for Secondary Schools Student’s Book Form One

Introduction to Book-Keeping

regulatory requirements, facilitates financial analysis, and enhances transparency and
accountability.

Within the realm of Book-keeping, various terms are commonly used in describing
key concepts. These include assets (the resources owned by a business), liabilities (the
debts or obligations), revenue (the income generated), expenses (the costs incurred),
FOR ONLINE READING ONLY
accounts receivable (amounts owed to the business by its customers), accounts
payable (amounts owed by the business to its suppliers), cashflows (the movement of
cash), journals (chronological records of transactions), ledgers (individual account
records), and financial statements (such as statement of financial position and income
statements). Familiarity with these terms is crucial for accurate record-keeping and
effective financial management.

Revision exercise 1

1. Explain how the origin and historical development of Book-keeping as a concept
has influenced modern accounting practices.
2. Describe the scope of Book-keeping and its role within the broader field of
financial management.

3. Explain the purposes of Book-keeping and its contribution to financial decision-
making.
4. Describe types of financial transactions covered in Book-keeping.

5. Provide a brief overview of Book-keeping and highlight its importance in managing
financial records.
6. Identify and describe the eight stages in the accounting cycle, explaining the

purpose and activities involved in each stage.

13

Book Keeping Form 1 New 2024 FINAL.indd 13 18/10/2024 10:14