I85PREP
⌘ K
Maharashtra SSC Employability Skills ITI study materials
Maharashtra SSC Employability Skills ITI study resources

Maharashtra SSC Employability Skills ITI: Financial Literacy and Basic Accounting

Maharashtra SSC Employability Skills ITI · Work through your exam, one topic at a time.

All guide sections

Financial Literacy and Basic Accounting

What this domain tests

This domain checks personal money management, banking and interest, safe digital payments, and the basic accounting records used in small enterprises.

Core ideas

  • Income, expense, savings: spend less than you earn, keep an emergency fund, and separate personal and business money.
  • Budget: list expected income and expenses, then compare with actual figures each month.
  • Banking: a savings account earns interest; KYC requires identity and address proof; never share the PIN, OTP or cheque book.
  • Interest: simple interest = principal × rate × time ÷ 100. Compound interest charges interest on interest, so it grows faster. On loans, compare the total repayment, not just the monthly instalment.
  • Insurance: transfers a large uncertain loss into a small known premium.
  • Digital fraud: fake links, requests to install screen-sharing apps, and callers claiming to be bank staff are common.
  • Accounting basics: bookkeeping records transactions; debit and credit are equal entries; assets are what the business owns, liabilities what it owes, and capital is the owner's investment. Profit and loss shows income minus expenses over a period; the balance sheet shows assets, liabilities and capital on a date.
  • Profit vs cash: a sale on credit is profit but not cash received.

Worked example

A trainee borrows ₹20,000 at 9% per annum simple interest for 2 years. Simple interest = 20,000 × 9 × 2 ÷ 100 = ₹3,600; total repayment = ₹23,600. If the same rate were compounded annually, year-one interest is ₹1,800 and year-two interest is charged on ₹21,800, giving ₹1,962, so total interest is ₹3,762. Reasoning: compounding raises the cost, and a borrower comparing offers must check whether the quoted rate is simple or compounded and over what period.

Mark-losing traps

  • Confusing profit with cash in the bank.
  • Reversing debit and credit entries.
  • Comparing loans by instalment size only.
  • Sharing an OTP with a caller claiming to be from the bank.
  • Mixing household spending with business accounts.