Book-keeping records daily financial transactions

Steps:

• Define book-keeping as the process of systematically recording business transactions in journals and ledgers.
• Evaluate option 1: Entering cheque details in the cash book is a recording of cash inflow, so it's book-keeping.
• Evaluate option 2: Entering credit purchases in the purchases journal records a liability, so it's book-keeping.
• Evaluate option 3: Producing an income statement summarizes data to calculate profit, which is accounting analysis, not basic recording.
• Evaluate option 4: Recording credit sales in a customer's account updates the ledger, so it's book-keeping.

Why B is correct:

• B selects 1, 2, and 4, matching the definition of book-keeping as transaction recording in books of original entry or ledgers.

Why the others are wrong:

• A includes 3, which is financial reporting, not recording.
• C omits 4, a valid ledger entry.
• D includes 3 and omits recording actions 1, 2, and 4.

Final answer: B