Originally Posted by Abdul Q

Conventions are the general accounting views to be taken into consideration while preparing Accounts.
If you are having accounting knowledge you must have studied the concepts like:
Prudence concept, separate entity concept, revenue recognition principles etc. they all fall into conventions and are the very basic concepts of accounting.

Let me solve the first 2 cases of Q No. 3 Paper I:
A) Supplies for personal use cannot be recorded as expense as Separate Business Entity Convention is applicable, So transaction should have been:
Drawings Dr
Cash/Bank Cr.
B) IAS 18 related to revenue provides guidline for the recording of service revenue. According to it Cash Basis should not be used rather one should record service revenue as the service has been rendered.

Hope you find the answer