Question

1(a) Outline two differences between bookkeeping and accounting. (b) List one source document used for each of the following transactions: (i) sales; (ii) purchases; (iii) cash deposit; (iv) salary; (v) returns outwards. (c) State three purposes of source documents.

Accepted Answer

(a) Differences between Bookkeeping and Accounting: i. Bookkeeping has to do with recording, while accounting deals with computation/interpretation of financial data. ii. Bookkeeper provides data that will be used by the accountant; thus bookkeeping is feeder while accounting is the beneficiary.
(b) Source document for each transaction: (i) Sales - Sales day book/Sales invoice. (ii) Purchases - Purchase day book/Purchase invoice. (iii) Cash deposit - Teller. (iv) Salary - Payroll. (v) Returns outward - Purchase day book/Debit note.
(c) Purposes of source documents: i. It serves as evidence for a transaction. ii. It helps in the imputation of accounts. iii. It serves as reference for future purposes.

WAEC Accounting 2020 Theory — Question 1

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