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All questions of The Fundamentals of Accounting for Grade 9 Exam
Unexpired expenses is ______account. - a)Real
- b)Nominal
- c)Personal
- d)Representative Personal
Correct answer is 'D'. Can you explain this answer?
Unexpired expenses is ______account.
a)
Real
b)
Nominal
c)
Personal
d)
Representative Personal
|
Priya Patel answered |
Unexpired expense is a representative personal account. These accounts are not in the name of any person or organisation but are represented as personal accounts.
Can you explain the answer of this question below: Bank overdraft account is a :
- A:
Personal account
- B:
Real account
- C:
Nominal account
- D:
Representative personal account
The answer is a.
Bank overdraft account is a :
Personal account
Real account
Nominal account
Representative personal account
|
Anu Sen answered |
Bank Overdraft is an artificial Personal account, so will be classified as Personal Account.
If wages are paid for construction of business premises, ________ A/c is credited and ____ A/c is debited.
- a)Wages, Cash
- b)Premises, Cash
- c)Cash, Wages
- d)Cash, Premises
Correct answer is option 'D'. Can you explain this answer?
If wages are paid for construction of business premises, ________ A/c is credited and ____ A/c is debited.
a)
Wages, Cash
b)
Premises, Cash
c)
Cash, Wages
d)
Cash, Premises
|
Freedom Institute answered |
If wages are paid for construction of business premises the amount of wages will be debited to the premises account because, according to IFRS, any expense that brings the asset to use or brings the asset in existence should be added to the cost of that machinery.
Cash account is credited because cash is being paid for incurring the wages.
Goods worth Rs. 10,000 were withdrawn by the proprietor for his personal use. The account to be credited is - a)Sales A/c
- b)Drawing A/c
- c)Purchases A/c
- d)Expenses A/c
Correct answer is 'C'. Can you explain this answer?
Goods worth Rs. 10,000 were withdrawn by the proprietor for his personal use. The account to be credited is
a)
Sales A/c
b)
Drawing A/c
c)
Purchases A/c
d)
Expenses A/c
|
|
Freedom Institute answered |
When the proprietor withdraws goods for personal use of Rs 10,000 it should be credited/deducted from the stock while calculating cost of goods sold and hence are deducted from purchases.
In case of bad debts, which account is credited?- a)Bad debts Account
- b)Creditors Account
- c)Debtors Account
- d)None of these
Correct answer is option 'C'. Can you explain this answer?
In case of bad debts, which account is credited?
a)
Bad debts Account
b)
Creditors Account
c)
Debtors Account
d)
None of these
|
Isha Chopra answered |
The correct answer is option C: Debtors Account.
Explanation:
When a debtor fails to make a payment on time or defaults on their debt, it becomes a bad debt for the company. In accounting, bad debts are considered as losses for the company and need to be accounted for properly.
To account for bad debts, the company uses the allowance method. Under this method, a provision for bad debts is created by estimating the amount of bad debts that are likely to occur in the future. This provision is recorded as an expense in the profit and loss account and a corresponding amount is debited to the bad debts account.
The bad debts account is a nominal account and is classified as an expense. It is used to record the amount of debts that are considered uncollectible and are written off from the debtor's account. By debiting the bad debts account, the company recognizes the loss incurred due to non-payment by the debtor.
On the other hand, when a debtor fails to make a payment, their account remains outstanding in the books of the company. The outstanding amount is recorded as a receivable in the debtor's account. When the bad debt is confirmed, the debtor's account is credited with the amount of the bad debt. This reduces the outstanding balance of the debtor and reflects the loss incurred by the company.
Therefore, in case of bad debts, the debtor's account is credited, as it represents the reduction in the amount receivable from the debtor. This allows the company to accurately reflect the financial impact of the bad debt and adjust its accounts accordingly.
Explanation:
When a debtor fails to make a payment on time or defaults on their debt, it becomes a bad debt for the company. In accounting, bad debts are considered as losses for the company and need to be accounted for properly.
To account for bad debts, the company uses the allowance method. Under this method, a provision for bad debts is created by estimating the amount of bad debts that are likely to occur in the future. This provision is recorded as an expense in the profit and loss account and a corresponding amount is debited to the bad debts account.
The bad debts account is a nominal account and is classified as an expense. It is used to record the amount of debts that are considered uncollectible and are written off from the debtor's account. By debiting the bad debts account, the company recognizes the loss incurred due to non-payment by the debtor.
On the other hand, when a debtor fails to make a payment, their account remains outstanding in the books of the company. The outstanding amount is recorded as a receivable in the debtor's account. When the bad debt is confirmed, the debtor's account is credited with the amount of the bad debt. This reduces the outstanding balance of the debtor and reflects the loss incurred by the company.
Therefore, in case of bad debts, the debtor's account is credited, as it represents the reduction in the amount receivable from the debtor. This allows the company to accurately reflect the financial impact of the bad debt and adjust its accounts accordingly.
Bill payable account.
- a)Personal
- b)Real
- c)Nominal
- d)None of the above
Correct answer is option 'A'. Can you explain this answer?
Bill payable account.
a)
Personal
b)
Real
c)
Nominal
d)
None of the above
|
Shereen Shaik answered |
It is a personal account because it is related to proprietor
Capital of business is Rs. 75,000 and liability is Rs. 25,000 then total assets of business would be: - a)Rs. 1,00,000
- b)Rs. 15,000
- c)Rs. 75,000
- d)Rs. 50,000
Correct answer is option 'A'. Can you explain this answer?
Capital of business is Rs. 75,000 and liability is Rs. 25,000 then total assets of business would be:
a)
Rs. 1,00,000
b)
Rs. 15,000
c)
Rs. 75,000
d)
Rs. 50,000
|
Arjun Singhania answered |
Description: Assets= Capital+ Liabilities
1,00,00= 75,000+ 25,000
Therefore, the total assets would be Rs.1,00,000
Can you explain the answer of this question below:Which of the following statement is correct?
- A:
All Entries except cash transactions can be recorded through journal.
- B:
Ledger is a part of subsidiary book.
- C:
Purchase book records all the purchases whether cash or credit.
- D:
Bank column of cash book always has debit balance.
The answer is a.
Which of the following statement is correct?
All Entries except cash transactions can be recorded through journal.
Ledger is a part of subsidiary book.
Purchase book records all the purchases whether cash or credit.
Bank column of cash book always has debit balance.
|
Tejas Chaudhary answered |
First listen the reason behind all 3 incorrect options.
b).. ledger is not a part of subsidiary books, it is a part of principal or main books since a business man can find the final information relating to different accounts from it.
c) purchase book records only credit records.
d) bank column of cash books could have a credit balance in case of overdraft.
now ultimately the option a is correct as we can record all transactions through journal except cash transactions,
b).. ledger is not a part of subsidiary books, it is a part of principal or main books since a business man can find the final information relating to different accounts from it.
c) purchase book records only credit records.
d) bank column of cash books could have a credit balance in case of overdraft.
now ultimately the option a is correct as we can record all transactions through journal except cash transactions,
Goods given as charity credited to :- a)Charity A/c
- b)Purchase A/c
- c)Drawings A/c
- d)Sales A/c
Correct answer is option 'B'. Can you explain this answer?
Goods given as charity credited to :
a)
Charity A/c
b)
Purchase A/c
c)
Drawings A/c
d)
Sales A/c
|
Neha Choudhury answered |
Explanation:
When goods are given as charity, it means that the business entity is giving away its products without expecting any payment in return. In such cases, the goods should be credited to the Purchase Account.
Reasons why goods given as charity should be credited to Purchase Account:
1. Charity is not a part of the normal business operations.
2. The cost of goods given as charity is a direct expense and should be charged to the Profit and Loss Account.
3. The Purchase Account represents the cost of goods purchased or acquired by the business, and it is used to calculate the cost of goods sold.
4. By crediting the Purchase Account, the cost of goods given as charity is deducted from the total cost of goods purchased, which results in a lower cost of goods sold and a higher gross profit.
Conclusion:
When goods are given as charity, they should be credited to the Purchase Account. This will ensure that the cost of goods given as charity is properly accounted for and deducted from the total cost of goods purchased.
When goods are given as charity, it means that the business entity is giving away its products without expecting any payment in return. In such cases, the goods should be credited to the Purchase Account.
Reasons why goods given as charity should be credited to Purchase Account:
1. Charity is not a part of the normal business operations.
2. The cost of goods given as charity is a direct expense and should be charged to the Profit and Loss Account.
3. The Purchase Account represents the cost of goods purchased or acquired by the business, and it is used to calculate the cost of goods sold.
4. By crediting the Purchase Account, the cost of goods given as charity is deducted from the total cost of goods purchased, which results in a lower cost of goods sold and a higher gross profit.
Conclusion:
When goods are given as charity, they should be credited to the Purchase Account. This will ensure that the cost of goods given as charity is properly accounted for and deducted from the total cost of goods purchased.
From the following details find out credit sales during the financial year 2010-2011:
1. Opening balance of sundry debtors on 1.4.10 Rs. 12,000.
2. Bills receivable accepted by customer Rs. 13,000
3. Closing balance of Sundry Debtors on 31.3.11 Rs. 14,000.
4. Cash received from debtors during the year Rs. 38,400
- a)Rs. 39,400
- b)Rs. 27,000
- c)Rs. 65,400
- d)Rs. 53,400
Correct answer is option 'D'. Can you explain this answer?
From the following details find out credit sales during the financial year 2010-2011:
1. Opening balance of sundry debtors on 1.4.10 Rs. 12,000.
2. Bills receivable accepted by customer Rs. 13,000
3. Closing balance of Sundry Debtors on 31.3.11 Rs. 14,000.
4. Cash received from debtors during the year Rs. 38,400
1. Opening balance of sundry debtors on 1.4.10 Rs. 12,000.
2. Bills receivable accepted by customer Rs. 13,000
3. Closing balance of Sundry Debtors on 31.3.11 Rs. 14,000.
4. Cash received from debtors during the year Rs. 38,400
a)
Rs. 39,400
b)
Rs. 27,000
c)
Rs. 65,400
d)
Rs. 53,400
|
Srsps answered |
Credit Sales=Closing Debtors+Cash Received from Debtors+Bills Receivable−Opening Debtors
Given:
- Opening balance of Sundry Debtors on 1.4.10 = Rs. 12,000
- Bills Receivable accepted by customers = Rs. 13,000
- Closing balance of Sundry Debtors on 31.3.11 = Rs. 14,000
- Cash received from Debtors during the year = Rs. 38,400
Now, let's calculate:
Credit Sales=14,000+38,400+13,000−12,000
Credit Sales=53,400
So, the correct answer is:
Option 4: Rs. 53,400
This a MCQ (Multiple Choice Question) based practice test of Chapter 2- Theory Base of Accounting of Accountancy of Class XI (11) for the quick revision/preparation of School Board examinationsQ According to which accounting principle personal expenses of proprietor are recorded in drawings account.
a)Money measurement
b)Matching
c)Prudence
d)Business Entity Concept
Correct answer is option 'D'. Can you explain this answer?
|
Ishan Choudhury answered |
According to business entity concept business is different from owners and it is treated as a separate unit or entity apart from owners. Personal expenses of proprietor will be recorded in drawings because it may be an expenses which relate to business entity .So the correct answer is d
Can you explain the answer of this question below:X is a dealer of electrical goods (such as Refrigerator, Washing Machines, Televisions etc.) He purchased two Air Conditioners and installed in his showroom. In the books of X, the cost of air conditioner would be debited in:
- A:
Drawings Account
- B:
Capital Account
- C:
Fixed asset account
- D:
Purchase account
The answer is c.
X is a dealer of electrical goods (such as Refrigerator, Washing Machines, Televisions etc.) He purchased two Air Conditioners and installed in his showroom. In the books of X, the cost of air conditioner would be debited in:
Drawings Account
Capital Account
Fixed asset account
Purchase account
|
Tejas Joshi answered |
Explanation:
When X purchased two air conditioners and installed them in his showroom, the cost of the air conditioners would be debited in the Fixed Asset Account. Here's why:
1. Fixed Asset Account:
Fixed assets are long-term tangible assets that are used to produce goods or services, and are not intended for sale to customers. Examples of fixed assets include land, buildings, machinery, and equipment. Since the air conditioners purchased by X are not intended for sale to customers, they would be classified as fixed assets.
2. Cost of Air Conditioners:
The cost of the air conditioners includes the purchase price, transportation costs, installation costs, and any other expenses incurred to bring the asset into its present condition and location. As such, the cost of the air conditioners would be debited in the Fixed Asset Account.
3. Purpose of Fixed Asset Account:
The purpose of the Fixed Asset Account is to track the cost of fixed assets over their useful life, and to record any depreciation or impairment of the assets as they are used in the business. By debiting the cost of the air conditioners in the Fixed Asset Account, X can track the value of the air conditioners over time and record any depreciation or impairment as necessary.
In conclusion, the correct answer is option 'C' Fixed Asset Account, as it is the appropriate account to record the cost of the air conditioners as fixed assets.
When X purchased two air conditioners and installed them in his showroom, the cost of the air conditioners would be debited in the Fixed Asset Account. Here's why:
1. Fixed Asset Account:
Fixed assets are long-term tangible assets that are used to produce goods or services, and are not intended for sale to customers. Examples of fixed assets include land, buildings, machinery, and equipment. Since the air conditioners purchased by X are not intended for sale to customers, they would be classified as fixed assets.
2. Cost of Air Conditioners:
The cost of the air conditioners includes the purchase price, transportation costs, installation costs, and any other expenses incurred to bring the asset into its present condition and location. As such, the cost of the air conditioners would be debited in the Fixed Asset Account.
3. Purpose of Fixed Asset Account:
The purpose of the Fixed Asset Account is to track the cost of fixed assets over their useful life, and to record any depreciation or impairment of the assets as they are used in the business. By debiting the cost of the air conditioners in the Fixed Asset Account, X can track the value of the air conditioners over time and record any depreciation or impairment as necessary.
In conclusion, the correct answer is option 'C' Fixed Asset Account, as it is the appropriate account to record the cost of the air conditioners as fixed assets.
“Debit the receiver and credit the giver” is the golden rule for which type of account?- a)Real A/c
- b)Personal A/c
- c)Nominal A/c
- d)None of these
Correct answer is option 'B'. Can you explain this answer?
“Debit the receiver and credit the giver” is the golden rule for which type of account?
a)
Real A/c
b)
Personal A/c
c)
Nominal A/c
d)
None of these
|
|
Miss U Jaan answered |
It's B Personal Account
Personal Account ka rule h Debit the receiver and credit the giver.
Personal Account ka rule h Debit the receiver and credit the giver.
A withdrawal of cash from business by the proprietor of the firm should be debited to ___________.
- a)Cash account
- b)Capital account
- c)Drawing account
- d)Purchase account
Correct answer is option 'C'. Can you explain this answer?
A withdrawal of cash from business by the proprietor of the firm should be debited to ___________.
a)
Cash account
b)
Capital account
c)
Drawing account
d)
Purchase account
|
|
Arun Khanna answered |
C: Drawings Account
The transaction is based on the separate entity concept which signifies that business and its proprietor are treated two separate legal entity.
Withdrawal of cash by proprietor should be debited to drawing account in the books of the business. Same amount should be credited by the proprietor in cash account.
A Furniture dealer during the financial year 2010-11, sold furniture of Rs. 25,000 to Mr. Sunil on cash basis. In the books of dealer _____ account will be debited and _________ account will be credited. - a)Cash, Fixed Assets
- b)Cash, Furniture
- c)Cash, Sales
- d)Cash, Sunil’s
Correct answer is option 'C'. Can you explain this answer?
A Furniture dealer during the financial year 2010-11, sold furniture of Rs. 25,000 to Mr. Sunil on cash basis. In the books of dealer _____ account will be debited and _________ account will be credited.
a)
Cash, Fixed Assets
b)
Cash, Furniture
c)
Cash, Sales
d)
Cash, Sunil’s
|
Gowri Chavan answered |
C)Cash, Sales
The management of a firm is remarkably incompetent, but the firms accountants can not take this into account while preparing book of accounts because of____ concept- a)Dual aspect concept
- b)Money measurement concept
- c)Cost concept
- d)Prudence
Correct answer is option 'B'. Can you explain this answer?
The management of a firm is remarkably incompetent, but the firms accountants can not take this into account while preparing book of accounts because of____ concept
a)
Dual aspect concept
b)
Money measurement concept
c)
Cost concept
d)
Prudence
|
Yash Kumar answered |
The correct answer to this question is option 'B' - Money measurement concept. Let's understand why this concept prevents the accountants from taking the management's incompetence into account while preparing the book of accounts.
The money measurement concept is a fundamental accounting principle that states that only transactions and events that can be expressed in monetary terms should be recorded in the accounting records. In other words, only the financial aspects of a transaction are considered, not the qualitative aspects.
Explanation:
1. Limitation of Monetary Terms: The money measurement concept is based on the assumption that only transactions that can be measured in monetary terms are relevant to the accounting process. As a result, any qualitative aspects of the management's incompetence, such as their decision-making abilities or leadership skills, cannot be quantified or expressed in monetary terms. Therefore, the accountants cannot take this into account while preparing the books of accounts.
2. Objective and Reliable Information: The primary objective of accounting is to provide reliable financial information to the users of financial statements. By focusing only on monetary aspects, the accountants ensure that the financial information is objective, verifiable, and consistent. Including subjective assessments of management's incompetence would undermine the reliability and objectivity of the financial statements.
3. Consistency and Comparability: The money measurement concept ensures consistency and comparability in financial reporting. If accountants were allowed to consider management's incompetence, it would introduce subjectivity and inconsistency in the preparation of financial statements. This would make it difficult for stakeholders to compare the financial performance and position of different firms.
4. Legal and Regulatory Requirements: Accounting standards and regulations, such as Generally Accepted Accounting Principles (GAAP) or International Financial Reporting Standards (IFRS), require financial statements to be prepared in accordance with the money measurement concept. Accountants are bound by these standards and must adhere to them while preparing the books of accounts.
In conclusion, the money measurement concept prohibits accountants from considering management's incompetence while preparing the book of accounts because it focuses solely on transactions and events that can be expressed in monetary terms. This ensures the objectivity, reliability, consistency, and comparability of financial information.
The money measurement concept is a fundamental accounting principle that states that only transactions and events that can be expressed in monetary terms should be recorded in the accounting records. In other words, only the financial aspects of a transaction are considered, not the qualitative aspects.
Explanation:
1. Limitation of Monetary Terms: The money measurement concept is based on the assumption that only transactions that can be measured in monetary terms are relevant to the accounting process. As a result, any qualitative aspects of the management's incompetence, such as their decision-making abilities or leadership skills, cannot be quantified or expressed in monetary terms. Therefore, the accountants cannot take this into account while preparing the books of accounts.
2. Objective and Reliable Information: The primary objective of accounting is to provide reliable financial information to the users of financial statements. By focusing only on monetary aspects, the accountants ensure that the financial information is objective, verifiable, and consistent. Including subjective assessments of management's incompetence would undermine the reliability and objectivity of the financial statements.
3. Consistency and Comparability: The money measurement concept ensures consistency and comparability in financial reporting. If accountants were allowed to consider management's incompetence, it would introduce subjectivity and inconsistency in the preparation of financial statements. This would make it difficult for stakeholders to compare the financial performance and position of different firms.
4. Legal and Regulatory Requirements: Accounting standards and regulations, such as Generally Accepted Accounting Principles (GAAP) or International Financial Reporting Standards (IFRS), require financial statements to be prepared in accordance with the money measurement concept. Accountants are bound by these standards and must adhere to them while preparing the books of accounts.
In conclusion, the money measurement concept prohibits accountants from considering management's incompetence while preparing the book of accounts because it focuses solely on transactions and events that can be expressed in monetary terms. This ensures the objectivity, reliability, consistency, and comparability of financial information.
Principle which assumes that a business enterprise will not be liquidated in the near future- a)Prudence
- b)Accounting entity
- c)Accounting period
- d)Going concern concept
Correct answer is option 'D'. Can you explain this answer?
Principle which assumes that a business enterprise will not be liquidated in the near future
a)
Prudence
b)
Accounting entity
c)
Accounting period
d)
Going concern concept
|
Nandini Iyer answered |
The going concern concept is a fundamental principle of accounting. It assumes that during and beyond the next fiscal period a company will complete its current plans, use its existing assets and continue to meet its financial obligations.
Can you explain the answer of this question below:X purchased goods on 90 days credit from Y worth Rs. 20,000. Y has given a trade discount of Rs. 1,000 on the same. Since Y also offered a cash discount of Rs. 500, if payment is made within 30 days, X avails the cash discount and paid the dues to Y. At the end of the year the goods purchases from Y remain unsold and included in the stock. The value of such goods would be:
- A:
Rs. 20,000
- B:
Rs. 19,500
- C:
Rs. 19,000
- D:
Rs. 18,500
The answer is c.
X purchased goods on 90 days credit from Y worth Rs. 20,000. Y has given a trade discount of Rs. 1,000 on the same. Since Y also offered a cash discount of Rs. 500, if payment is made within 30 days, X avails the cash discount and paid the dues to Y. At the end of the year the goods purchases from Y remain unsold and included in the stock. The value of such goods would be:
Rs. 20,000
Rs. 19,500
Rs. 19,000
Rs. 18,500
|
|
Poonam Reddy answered |
Correct Answer :- c
Explanation : If goods remain unsold then there will be no deduction of cash discount from total amount but trade discount will be deducted.
Therefore, trade discount = 20000 - 1000
= 19000.
Furniture of book value of Rs. 20,000 was sold for Rs. 6,000 and new furniture of Rs. 20,000 was purchased. Amount debited towards purchase of new furniture will be:-- a)Rs. 14,000
- b)Rs. 29,000
- c)Rs. 5,000
- d)Rs. 20,000
Correct answer is option 'D'. Can you explain this answer?
Furniture of book value of Rs. 20,000 was sold for Rs. 6,000 and new furniture of Rs. 20,000 was purchased. Amount debited towards purchase of new furniture will be:-
a)
Rs. 14,000
b)
Rs. 29,000
c)
Rs. 5,000
d)
Rs. 20,000
|
Puja Kaur answered |
Calculation:
The selling price of furniture = Rs. 6,000
The book value of furniture = Rs. 20,000
Therefore, the loss on the sale of furniture = Book value of furniture - Selling price of furniture
= Rs. (20,000 - 6,000)
= Rs. 14,000
The amount debited towards the purchase of new furniture will be the cost of new furniture minus the loss on the sale of old furniture.
Cost of new furniture = Rs. 20,000
Amount debited towards the purchase of new furniture = Cost of new furniture - Loss on sale of old furniture
= Rs. (20,000 - 14,000)
= Rs. 6,000
Therefore, the correct answer is option 'D' - Rs. 20,000.
The selling price of furniture = Rs. 6,000
The book value of furniture = Rs. 20,000
Therefore, the loss on the sale of furniture = Book value of furniture - Selling price of furniture
= Rs. (20,000 - 6,000)
= Rs. 14,000
The amount debited towards the purchase of new furniture will be the cost of new furniture minus the loss on the sale of old furniture.
Cost of new furniture = Rs. 20,000
Amount debited towards the purchase of new furniture = Cost of new furniture - Loss on sale of old furniture
= Rs. (20,000 - 14,000)
= Rs. 6,000
Therefore, the correct answer is option 'D' - Rs. 20,000.
A opened an account with Rs. 5,000 on 3/12/09. He deposited Rs. 1,000 on 7/12/09. He withdraw Rs. 2,000 on 15/12/09 and deposited a cheque of Rs. 10,000 on 20/12/09. What is the balance on 31/12/09?- a)Rs. 18,000
- b)Rs. 14,000
- c)Rs. 4,000
- d)None
Correct answer is option 'B'. Can you explain this answer?
A opened an account with Rs. 5,000 on 3/12/09. He deposited Rs. 1,000 on 7/12/09. He withdraw Rs. 2,000 on 15/12/09 and deposited a cheque of Rs. 10,000 on 20/12/09. What is the balance on 31/12/09?
a)
Rs. 18,000
b)
Rs. 14,000
c)
Rs. 4,000
d)
None
|
Anuj Choudhury answered |
Calculation of balance on 31/12/09:
Opening balance on 3/12/09 = Rs. 5,000
Deposit on 7/12/09 = Rs. 1,000
Balance as on 7/12/09 = Rs. 6,000
Withdrawal on 15/12/09 = Rs. 2,000
Balance as on 15/12/09 = Rs. 4,000
Deposit of cheque on 20/12/09 = Rs. 10,000
Balance as on 20/12/09 = Rs. 14,000
Therefore, the balance on 31/12/09 will still be Rs. 14,000 as there is no further transaction mentioned. Hence, option B is the correct answer.
Opening balance on 3/12/09 = Rs. 5,000
Deposit on 7/12/09 = Rs. 1,000
Balance as on 7/12/09 = Rs. 6,000
Withdrawal on 15/12/09 = Rs. 2,000
Balance as on 15/12/09 = Rs. 4,000
Deposit of cheque on 20/12/09 = Rs. 10,000
Balance as on 20/12/09 = Rs. 14,000
Therefore, the balance on 31/12/09 will still be Rs. 14,000 as there is no further transaction mentioned. Hence, option B is the correct answer.
Credit balance in ledger will be either:-- a)A revenue or an asset
- b)An expense or an asset
- c)A revenue or a liability
- d)An expense or a liability
Correct answer is option 'C'. Can you explain this answer?
Credit balance in ledger will be either:-
a)
A revenue or an asset
b)
An expense or an asset
c)
A revenue or a liability
d)
An expense or a liability
|
|
Nandini Iyer answered |
In accounting, a credit balance is the ending amount found on the right side of a general ledger account or subsidiary ledger account. A credit balance is normal and expected for the following general ledger and subsidiary ledger accounts: Liability accounts.
Under which accounting principle quality of manpower is not recorded in the books of accounts- a)Money measurement
- b)Accounting period
- c)Accounting entity
- d)Going concern
Correct answer is option 'A'. Can you explain this answer?
Under which accounting principle quality of manpower is not recorded in the books of accounts
a)
Money measurement
b)
Accounting period
c)
Accounting entity
d)
Going concern
|
|
Poonam Reddy answered |
The accounting principle where the quality of manpower is not recorded in the accounts book is Money Measurement Principle.
This concept underlines the fact that in economics and accounting generally, every recorded transaction or event is measured with regards to money.
By utilizing this principle, the happening or a fact or event that cannot be indicated in terms of money are not recorded in accounting books.
Capital Account is a _________.- a)Real A/c
- b)Personal A/c
- c)Nominal A/c
- d)None of these
Correct answer is option 'B'. Can you explain this answer?
Capital Account is a _________.
a)
Real A/c
b)
Personal A/c
c)
Nominal A/c
d)
None of these
|
|
Alok Mehta answered |
Capital Account is a Personal Account because it represents owner of the business.
Personal Accounts:
The elements or accounts which represent persons and organizations.
Mrs. Vimla a/c - representing Mrs. Vimla a person.
M/s Bharat & Co a/c - representing M/s Bharat & Co, an organisation.
Capital a/c - representing the owner of the business, a person or organisation.
Bank a/c - representing Bank, an organisation.
Hence, the correct answer is Option B
For notes On Base Of Accounting Click on the link given below:
Value of goods drawn by proprietor should be credited to:
- a)Capital Account
- b)Sales Account
- c) Drawings Account
- d) Purchases Account
Correct answer is option 'D'. Can you explain this answer?
Value of goods drawn by proprietor should be credited to:
a)
Capital Account
b)
Sales Account
c)
Drawings Account
d)
Purchases Account
|
Rajat Patel answered |
The correct option is D.
The goods taken by the proprietor for personal use, reduce the inventory of the business. Hence, it is placed on a temporary drawings account. It reduces the Owner's equity account. It is not an expense of the business.
The goods taken by the proprietor for personal use, reduce the inventory of the business. Hence, it is placed on a temporary drawings account. It reduces the Owner's equity account. It is not an expense of the business.
DEBIT signifies: - a)Increase in Assets account
- b)Decrease in Liability account
- c)Decrease in Capital account
- d)All of the above
Correct answer is 'D'. Can you explain this answer?
DEBIT signifies:
a)
Increase in Assets account
b)
Decrease in Liability account
c)
Decrease in Capital account
d)
All of the above
|
Gowri Chakraborty answered |
In bookkeeping, a debit can signify an increase in an asset, an expense, and the owner's draws. A debit can also signify a decrease in a liability, revenues, and owner's equity.
A debit is one-half of bookkeeping's double-entry system. The other half is a credit.
Sunset Tours has a Rs. 3,500 account receivable from Mohan. On January 20, the Rotary makes a partial payment of Rs. 2100 to Sunset Tours. The journal entry made on January 20 by Sunset Tours to record this transaction includes:
- a)A credit to the received account of Rs. 2,100.
- b)A credit to the Account receivable account of Rs. 2,100.
- c)A debit to the cash account of Rs. 1,400.
- d)A debit to the Account receivable account of Rs. 1,400.
Correct answer is option 'B'. Can you explain this answer?
Sunset Tours has a Rs. 3,500 account receivable from Mohan. On January 20, the Rotary makes a partial payment of Rs. 2100 to Sunset Tours. The journal entry made on January 20 by Sunset Tours to record this transaction includes:
a)
A credit to the received account of Rs. 2,100.
b)
A credit to the Account receivable account of Rs. 2,100.
c)
A debit to the cash account of Rs. 1,400.
d)
A debit to the Account receivable account of Rs. 1,400.
|
|
Apaar Singh answered |
Cash account is Dr by 2100 and account recievebale account is credited because. cash is inc and debtors is decreased and when decrease in asset we credit that account
Cash account is a - a)Personal account
- b)Real account
- c)Nominal account
- d)None of the above.
Correct answer is option 'B'. Can you explain this answer?
Cash account is a
a)
Personal account
b)
Real account
c)
Nominal account
d)
None of the above.
|
|
Gayatri Khanna answered |
Cash account can be classified as a real account. A real account is an account that retains and rolls forward its ending balance from period to period. The areas in the balance sheet in which real accounts are found are assets, liabilities, and equity.
What will be the Journal Entry when goods purchased are returned? - a)Creditors A/c Dr. To Purchase Returns A/c
- b)Purchase Return A/c Dr. To Creditors A/c
- c)Creditors A/c Dr. To Sales A/c
- d)None of these.
Correct answer is option 'A'. Can you explain this answer?
What will be the Journal Entry when goods purchased are returned?
a)
Creditors A/c Dr. To Purchase Returns A/c
b)
Purchase Return A/c Dr. To Creditors A/c
c)
Creditors A/c Dr. To Sales A/c
d)
None of these.
|
|
Huzaifa Arthuna answered |
Purchase return is the income of the firm & creditors will decreases
The debts, which are to be repaid within a short period (year or less) are known as- a)Current liabilities
- b)Fixed liabilities
- c)Contingent liabilities
- d)All of the above
Correct answer is option 'A'. Can you explain this answer?
The debts, which are to be repaid within a short period (year or less) are known as
a)
Current liabilities
b)
Fixed liabilities
c)
Contingent liabilities
d)
All of the above
|
|
Poonam Reddy answered |
The debts which are to be repaid within a short period (year or less) are known as Current liabilities. Current liabilities are a company's debts or obligations that are due within one year or within a normal operating cycle.
Can you explain the answer of this question below:Recovery of bad debts written off previously will be ?
- A:
Credited to debtors A/c
- B:
Adjusted against provision for doubtful debts
- C:
Debited to debtors A/c
- D:
Credited to Profit and Loss A/c
The answer is d.
Recovery of bad debts written off previously will be ?
Credited to debtors A/c
Adjusted against provision for doubtful debts
Debited to debtors A/c
Credited to Profit and Loss A/c
|
Madhurima Dasgupta answered |
Recovery of bad debts written off previously will be credited to Profit and Loss A/c. This can be explained in the following points:
1. Bad debts: When a debtor fails to pay the outstanding dues, it is considered as bad debt. The company writes off such bad debts from its books of accounts as they are considered as irrecoverable.
2. Provision for doubtful debts: To account for the possibility of bad debts, companies create a provision for doubtful debts. This provision is created by estimating the amount of bad debts that are likely to occur in the future.
3. Recovery of bad debts: Sometimes, a debtor who has been written off as bad debt pays the outstanding dues. This is considered as the recovery of bad debts.
4. Accounting treatment: The recovery of bad debts is credited to Profit and Loss A/c because it is a gain for the company. The bad debt was written off in the past, which means that the company had already accounted for the loss. Therefore, the recovery of bad debts is considered as a gain for the company, and it is credited to the Profit and Loss A/c.
5. Impact on provision for doubtful debts: The recovery of bad debts does not impact the provision for doubtful debts. This is because the provision was created based on an estimate of bad debts that are yet to occur. The recovery of bad debts is an unexpected event, and it does not change the estimate of future bad debts.
In conclusion, the recovery of bad debts written off previously will be credited to Profit and Loss A/c because it is a gain for the company. It does not impact the provision for doubtful debts as it is an unexpected event.
1. Bad debts: When a debtor fails to pay the outstanding dues, it is considered as bad debt. The company writes off such bad debts from its books of accounts as they are considered as irrecoverable.
2. Provision for doubtful debts: To account for the possibility of bad debts, companies create a provision for doubtful debts. This provision is created by estimating the amount of bad debts that are likely to occur in the future.
3. Recovery of bad debts: Sometimes, a debtor who has been written off as bad debt pays the outstanding dues. This is considered as the recovery of bad debts.
4. Accounting treatment: The recovery of bad debts is credited to Profit and Loss A/c because it is a gain for the company. The bad debt was written off in the past, which means that the company had already accounted for the loss. Therefore, the recovery of bad debts is considered as a gain for the company, and it is credited to the Profit and Loss A/c.
5. Impact on provision for doubtful debts: The recovery of bad debts does not impact the provision for doubtful debts. This is because the provision was created based on an estimate of bad debts that are yet to occur. The recovery of bad debts is an unexpected event, and it does not change the estimate of future bad debts.
In conclusion, the recovery of bad debts written off previously will be credited to Profit and Loss A/c because it is a gain for the company. It does not impact the provision for doubtful debts as it is an unexpected event.
Which of the following is a real account?- a)Building A/c
- b)Capital A/c
- c)Rent A/c
- d)All these.
Correct answer is option 'A'. Can you explain this answer?
Which of the following is a real account?
a)
Building A/c
b)
Capital A/c
c)
Rent A/c
d)
All these.
|
|
Ishan Choudhury answered |
There are mainly three types of accounts:
i) Real
ii) Personal and
iii) Nominal accounts.
i) Real
ii) Personal and
iii) Nominal accounts.
All assets of a firm, which are tangible or intangible, fall under the category "Real accounts".
Tangible real accounts are related to those things that can be touched and physically felt. Few examples of tangible real accounts are buildings, machinery, stock, land, etc.
Intangible real accounts are those which can't be touched and physically felt. Few examples of intangible real accounts are trademarks, patents, goodwill, etc.
Closing stock is valued at lower of cost or market price. Which concept of accounting is applied here- a)Matching concept
- b)Prudence
- c)Cost concept
- d)Revenue concept
Correct answer is option 'B'. Can you explain this answer?
Closing stock is valued at lower of cost or market price. Which concept of accounting is applied here
a)
Matching concept
b)
Prudence
c)
Cost concept
d)
Revenue concept
|
|
Rajat Patel answered |
It is based on the Prudence or Conservatism Principle, according to which all the prospective losses are taken into consideration and not the prospective profits. The assumption of this concept ensures that the financial statement presents a realistic picture of state of affairs of the enterprise.
Under which system of accounting transactions is recorded in the books of accounts on the receipt/payment of cash- a)Accrual basis
- b)Cash Basis
- c)Money basis
- d)Profit basic
Correct answer is option 'B'. Can you explain this answer?
Under which system of accounting transactions is recorded in the books of accounts on the receipt/payment of cash
a)
Accrual basis
b)
Cash Basis
c)
Money basis
d)
Profit basic
|
|
Rajat Patel answered |
The cash basis is a method of recording accounting transactions for revenue and expenses only when the corresponding cash is received or payments are made. Thus, you record revenue only when a customer pays for a billed product or service, and you record a payable only when it is paid by the company. Many small business owners may be using the cash basis without even realizing it, if they are recording business transactions primarily with a check book.
According to Business Entity concept- a)Transactions between the business and its owner are recorded from the business point of view
- b)Transactions between the business and its owner are recoded considering it single entity
- c)Transactions between the business and its owner are not recoded
- d)None of these
Correct answer is option 'A'. Can you explain this answer?
According to Business Entity concept
a)
Transactions between the business and its owner are recorded from the business point of view
b)
Transactions between the business and its owner are recoded considering it single entity
c)
Transactions between the business and its owner are not recoded
d)
None of these
|
|
Nandini Iyer answered |
The business entity concept states that the transactions associated with a business must be separately recorded from those of its owners or other businesses. Doing so requires the use of separate accounting records for the organization that completely exclude the assets and liabilities of any other entity or the owner.
Here are several examples of the business entity concept:
- - A business issues a $1,000 distribution to its sole shareholder. This is a reduction in equity in the records of the business, and $1,000 of taxable income to the shareholder.
- The owner of a company personally acquires an office building, and rents space in it to his company at $5,000 per month. This rent expenditure is a valid expense to the company, and is taxable income to the owner.
“Machinery sold for Rs. 30,000 on credit.” In which subsidiary book this transaction will be recorded?- a)Sales Register
- b)Cash Book
- c)Journal
- d)No Entry will be made
Correct answer is option 'C'. Can you explain this answer?
“Machinery sold for Rs. 30,000 on credit.” In which subsidiary book this transaction will be recorded?
a)
Sales Register
b)
Cash Book
c)
Journal
d)
No Entry will be made
|
Jayant Mishra answered |
Sales Register records the sale of goods in trade of the business whereas cash book records all cash receipts and expenses of regular nature. Machinery is an asset and is sold on credit so it will be recorded in journal.
Note: Entries that are not recorded in any subsidiary book are recorded in journal.
______________ are written statements issued from time to time by institutions of accounting professionals, specifying uniform rules for drawing the financial statements- a)Accounting standards
- b)Journal principles
- c)Accounting concepts
- d)Accounting principles
Correct answer is option 'A'. Can you explain this answer?
______________ are written statements issued from time to time by institutions of accounting professionals, specifying uniform rules for drawing the financial statements
a)
Accounting standards
b)
Journal principles
c)
Accounting concepts
d)
Accounting principles
|
Mukunth Shiva answered |
Accounting standards are guidelines providing the framework so that credible Financial statements can be produced.The objective of setting Accounting standards is to bring uniformity in accounting practices and to ensure transparency,consistency and comparability.Accounting statements are prepared keeping in view the business environment and laws of the country.It therefore naturally means that the guidelines change with change in business environment and laws.
Can you explain the answer of this question below:
From the following information ascertain the closing balance of debtors:
Opening balance of debtors Rs. 32,600; total sales Rs. 1,03,000; cash collected from debtors Rs. 70,000 sales return Rs.1,500; discount on purchases Rs. 1,200; cash sales Rs. 43,000; bad debts Rs. 700:
- A:
Rs. 19,200
- B:
Rs. 20,400
- C:
Rs. 63,400
- D:
Rs. 21,900
The answer is b.
From the following information ascertain the closing balance of debtors:
Opening balance of debtors Rs. 32,600; total sales Rs. 1,03,000; cash collected from debtors Rs. 70,000 sales return Rs.1,500; discount on purchases Rs. 1,200; cash sales Rs. 43,000; bad debts Rs. 700:
Rs. 19,200
Rs. 20,400
Rs. 63,400
Rs. 21,900
|
|
Srsps answered |
Debtors a/c=Debit side in so opening debtors +credit sale -(cash received +sale return + bad debts) in credit side=closing debtors
32600+60000 - (70000+1500+700) =20400
Which of the following accounts may have a debit or a credit balance?
- a)Partner’s Current Account
- b)Purchase Account
- c)Commission (Recd) Account
- d)None
Correct answer is option 'A'. Can you explain this answer?
Which of the following accounts may have a debit or a credit balance?
a)
Partner’s Current Account
b)
Purchase Account
c)
Commission (Recd) Account
d)
None
|
|
Rajat Patel answered |
This account can have either a debit or a credit balance, depending on whether the partner has contributed additional capital (credit) or withdrawn funds (debit) from the business.
Which accounting principle requires that life of a business be broken into smaller parts- a)Accounting entity
- b)Prudence
- c)Going concern concept
- d)Accounting period
Correct answer is option 'D'. Can you explain this answer?
Which accounting principle requires that life of a business be broken into smaller parts
a)
Accounting entity
b)
Prudence
c)
Going concern concept
d)
Accounting period
|
Arnav Sharma answered |
The time
period principle
(or time
period
assumption) is an
accounting principle
which states that a business should report their financial statements appropriate to a specific time
period
. ... In financial terms, a time
period
is often referred to as the
accounting
year, or
accounting
and reporting time
periods
.
Full form of GAAP- a)Generally Accounting Accepted principles
- b)Journal Accepted Accounting principles
- c)Generally Accepted Accounting prudence
- d)Generally Accepted Accounting principles
Correct answer is option 'D'. Can you explain this answer?
Full form of GAAP
a)
Generally Accounting Accepted principles
b)
Journal Accepted Accounting principles
c)
Generally Accepted Accounting prudence
d)
Generally Accepted Accounting principles
|
|
Aryan Khanna answered |
GAAP means Generally Accepted Accounting Principles is a combination of authoritative standards (set by police boards) and the commonly accepted ways of recording and reporting accounting information. GAAP improves the clarity of the communication of financial information.
Debit the receiver and credit the giver is correct for.
- a)Personal
- b)Real
- c)Nominal
- d)Hypothetical
Correct answer is option 'A'. Can you explain this answer?
Debit the receiver and credit the giver is correct for.
a)
Personal
b)
Real
c)
Nominal
d)
Hypothetical
|
|
Priyanshu Tiwari answered |
Debit the receiver, and credit the giver" is a golden rule for Personal A/c. Personal accounts are the accounts for individual, firms, companies etc. By debit the receiver means the person who is receiving goods on credit will be debited and the person who is giving will be credited.
Bank overdraft account is a : - a)Personal account
- b)Real account
- c)Nominal account
- d)Representative personal account
Correct answer is option 'A'. Can you explain this answer?
Bank overdraft account is a :
a)
Personal account
b)
Real account
c)
Nominal account
d)
Representative personal account
|
|
Saumya Khanna answered |
Bank Overdraft is an artificial Personal account, so will be classified as Personal Account.
Profit is : - a)Revenue
- b)Expense
- c)Asset
- d)Owner Capital
Correct answer is option 'D'. Can you explain this answer?
Profit is :
a)
Revenue
b)
Expense
c)
Asset
d)
Owner Capital
|
Sparsh Sen answered |
Profit is Owner Capital
Profit is one of the most important financial metrics that a business owner must know. It is the difference between total revenue and total expenses incurred during a specific period. Profit is a key indicator of a business's financial health and sustainability. The correct answer to this question is option 'D', i.e., Owner Capital.
Explanation:
Profit is the amount of money that a business owner earns after deducting all expenses and taxes. It is the money that is left over from the revenue generated by the business. Profit is a measure of how well a business is doing financially.
Owner Capital refers to the amount of money that the owner has invested in the business. It includes the initial investment made by the owner and any additional investments made over time. The profit earned by the business is considered as the return on the owner's investment. Therefore, profit is directly related to owner capital.
In simple terms, profit increases the owner's equity in the business. It is the money that the owner can use to reinvest in the business or take out as personal income. Profit is essential for the growth and sustainability of a business.
Conclusion:
In conclusion, profit is the difference between total revenue and total expenses incurred during a specific period. It is a measure of how well a business is doing financially. Profit is directly related to the owner's capital, which includes the initial investment and any additional investments made over time. Profit is essential for the growth and sustainability of a business, and it increases the owner's equity in the business.
Profit is one of the most important financial metrics that a business owner must know. It is the difference between total revenue and total expenses incurred during a specific period. Profit is a key indicator of a business's financial health and sustainability. The correct answer to this question is option 'D', i.e., Owner Capital.
Explanation:
Profit is the amount of money that a business owner earns after deducting all expenses and taxes. It is the money that is left over from the revenue generated by the business. Profit is a measure of how well a business is doing financially.
Owner Capital refers to the amount of money that the owner has invested in the business. It includes the initial investment made by the owner and any additional investments made over time. The profit earned by the business is considered as the return on the owner's investment. Therefore, profit is directly related to owner capital.
In simple terms, profit increases the owner's equity in the business. It is the money that the owner can use to reinvest in the business or take out as personal income. Profit is essential for the growth and sustainability of a business.
Conclusion:
In conclusion, profit is the difference between total revenue and total expenses incurred during a specific period. It is a measure of how well a business is doing financially. Profit is directly related to the owner's capital, which includes the initial investment and any additional investments made over time. Profit is essential for the growth and sustainability of a business, and it increases the owner's equity in the business.
The rent paid to landlord is credited to:
- a)Cash Account
- b)Rent Account
- c)Landlord`s Account
- d)None of these
Correct answer is option 'C'. Can you explain this answer?
The rent paid to landlord is credited to:
a)
Cash Account
b)
Rent Account
c)
Landlord`s Account
d)
None of these
|
|
Arun Khanna answered |
Landlord`s Account
In double-entry accounting, payments for expenses are typically recorded by debiting the expense account and crediting the cash account. However, if the payment is made to a specific individual or organization, it is generally credited to their account.
In this case, the rent paid to the landlord is an expense for Sunset Tours. To record the payment, Sunset Tours would debit the rent expense account and credit the cash account to reduce the amount of cash on hand. However, since the payment is made to the landlord, it would also be credited to the landlord's account to reduce the amount owed.
The journal entry would be:
Rent Expense (Debit) Cash (Credit) Landlord (Credit)
Options B, C, and D are incorrect because they do not accurately reflect the transaction. The rent account is an expense account and would be debited, not credited. The cash account would be credited to reduce the amount of cash on hand, but it would not be credited to the landlord's account. The transaction does not involve any of the other options listed.
It is important to understand the rules for recording transactions in order to accurately prepare financial statements and effectively manage a business.
Which statements are drawn to provide information about growth or decline of business activities over a period of time or comparison of the results, i.e. intra-firm or inter firm comparisons- a)Cost statements
- b)Management statements
- c)Financial statements
- d)All of these
Correct answer is option 'C'. Can you explain this answer?
Which statements are drawn to provide information about growth or decline of business activities over a period of time or comparison of the results, i.e. intra-firm or inter firm comparisons
a)
Cost statements
b)
Management statements
c)
Financial statements
d)
All of these
|
Shail Chakraborty answered |
Financial Statements for Business Growth or Decline
Financial statements are documents that describe the financial activities of a business. These statements are used to provide information about the growth or decline of business activities over a period of time or comparison of the results, i.e. intra-firm or inter firm comparisons. Financial statements are an important tool for business owners, investors, and banks, as they provide insight into the financial health of a business.
Types of Financial Statements
There are three main types of financial statements:
1. Income Statement: The income statement shows the revenue and expenses of a business over a specific period of time. This statement provides information about the profitability of a business.
2. Balance Sheet: The balance sheet shows the assets, liabilities, and equity of a business at a specific point in time. This statement provides information about the financial position of a business.
3. Cash Flow Statement: The cash flow statement shows the inflows and outflows of cash in a business over a specific period of time. This statement provides information about the liquidity of a business.
Why Financial Statements are Important?
Financial statements are important for a number of reasons, including:
1. Decision Making: Financial statements are used by business owners, investors, and banks to make decisions about the future of a business. By analyzing financial statements, these stakeholders can identify strengths and weaknesses in a business, and make informed decisions about how to proceed.
2. Benchmarking: Financial statements can be used to compare the performance of a business against industry benchmarks or against other businesses of a similar size or in a similar industry.
3. Compliance: Financial statements are required by law in many countries, and must be submitted to regulatory bodies or tax authorities.
Conclusion
In conclusion, financial statements are an important tool for analyzing the growth or decline of business activities over a period of time or comparison of the results, i.e. intra-firm or inter firm comparisons. By providing information about the financial health of a business, financial statements can help business owners, investors, and banks make informed decisions about the future of a business.
Financial statements are documents that describe the financial activities of a business. These statements are used to provide information about the growth or decline of business activities over a period of time or comparison of the results, i.e. intra-firm or inter firm comparisons. Financial statements are an important tool for business owners, investors, and banks, as they provide insight into the financial health of a business.
Types of Financial Statements
There are three main types of financial statements:
1. Income Statement: The income statement shows the revenue and expenses of a business over a specific period of time. This statement provides information about the profitability of a business.
2. Balance Sheet: The balance sheet shows the assets, liabilities, and equity of a business at a specific point in time. This statement provides information about the financial position of a business.
3. Cash Flow Statement: The cash flow statement shows the inflows and outflows of cash in a business over a specific period of time. This statement provides information about the liquidity of a business.
Why Financial Statements are Important?
Financial statements are important for a number of reasons, including:
1. Decision Making: Financial statements are used by business owners, investors, and banks to make decisions about the future of a business. By analyzing financial statements, these stakeholders can identify strengths and weaknesses in a business, and make informed decisions about how to proceed.
2. Benchmarking: Financial statements can be used to compare the performance of a business against industry benchmarks or against other businesses of a similar size or in a similar industry.
3. Compliance: Financial statements are required by law in many countries, and must be submitted to regulatory bodies or tax authorities.
Conclusion
In conclusion, financial statements are an important tool for analyzing the growth or decline of business activities over a period of time or comparison of the results, i.e. intra-firm or inter firm comparisons. By providing information about the financial health of a business, financial statements can help business owners, investors, and banks make informed decisions about the future of a business.
Purchase Return Account always shows a _______ balance.- a)Debit
- b)Credit
- c)Either (a) or (b)
- d)None
Correct answer is option 'B'. Can you explain this answer?
Purchase Return Account always shows a _______ balance.
a)
Debit
b)
Credit
c)
Either (a) or (b)
d)
None
|
|
Aditya Das answered |
A purchase return account shows the credit balance. Purchase return represents the amount of goods returned to the supplier. When goods are bought from a supplier, the purchases A/c will be debited and when the goods are returned, the purchase return A/c will be credited as stock is reduced.
Cash Sales Rs. 50,000
Cash collected from debtors Rs.1,30,000
Bad debts during year Rs. 5,000
Debtors at beginning Rs. 10,000
Total Sales will be :- a)Rs. 1,75,000
- b)Rs. 1,70,000
- c)Rs. 1,80,000
- d)Rs. 1,78,000
Correct answer is option 'A'. Can you explain this answer?
Cash Sales Rs. 50,000
Cash collected from debtors Rs.1,30,000
Bad debts during year Rs. 5,000
Debtors at beginning Rs. 10,000
Total Sales will be :
Cash collected from debtors Rs.1,30,000
Bad debts during year Rs. 5,000
Debtors at beginning Rs. 10,000
Total Sales will be :
a)
Rs. 1,75,000
b)
Rs. 1,70,000
c)
Rs. 1,80,000
d)
Rs. 1,78,000
|
|
Ipsita Rane answered |
Total sales= Cash sales+cash collected from debtors - (Debtors at beginning-Bad debts during year.
So 50000+130000-(10000-5000)=175000
Prepaid salary account.- a)Personal
- b)Real
- c)Nominal
- d)None of the above
Correct answer is option 'A'. Can you explain this answer?
Prepaid salary account.
a)
Personal
b)
Real
c)
Nominal
d)
None of the above
|
|
Priya Patel answered |
Prepaid salary, prepaid rent etc. Prepaid expenses are recorded in the books at the end of an accounting period to show true numbers of a business. Prepaid (Unexpired) expense is a personal account and is shown on the Assets side of a balance sheet. Expenses are amounts paid for goods or services purchased.
A diamond ring worth Rs. 1,00,000 was stolen from the shop of M/s Shine Jewellers during the accounting year 2011-12. Insurance claim of Rs. 60,000 was admitted by the insurance company but not disbursed up to the end of the accounting year. In this regard no entry was passed in the books of accounts. The correct journal entry for preparing the final accounts for the year ended 31st March 2012, would be: - a)Profit & Loss A/c Dr. 1,00,000
To Purchases A/c 1,00,000 - b)Insurance claim
receivable A/c Dr. 60,000
Loss by theft A/c Dr. 40,000
To Purchases A/c 1,00,000 - c)Profit & Loss A/c Dr. 40,000
Insurance claim
receivable A/c Dr. 60,000
To Purchase A/c 1,00,000 - d)Insurance claim
receivable A/c Dr. 60,000
Insurance company
A/c Dr. 40,000
To Purchases A/c 1,00,000
Correct answer is 'C'. Can you explain this answer?
A diamond ring worth Rs. 1,00,000 was stolen from the shop of M/s Shine Jewellers during the accounting year 2011-12. Insurance claim of Rs. 60,000 was admitted by the insurance company but not disbursed up to the end of the accounting year. In this regard no entry was passed in the books of accounts. The correct journal entry for preparing the final accounts for the year ended 31st March 2012, would be:
a)
Profit & Loss A/c Dr. 1,00,000
To Purchases A/c 1,00,000
To Purchases A/c 1,00,000
b)
Insurance claim
receivable A/c Dr. 60,000
Loss by theft A/c Dr. 40,000
To Purchases A/c 1,00,000
receivable A/c Dr. 60,000
Loss by theft A/c Dr. 40,000
To Purchases A/c 1,00,000
c)
Profit & Loss A/c Dr. 40,000
Insurance claim
receivable A/c Dr. 60,000
To Purchase A/c 1,00,000
Insurance claim
receivable A/c Dr. 60,000
To Purchase A/c 1,00,000
d)
Insurance claim
receivable A/c Dr. 60,000
Insurance company
A/c Dr. 40,000
To Purchases A/c 1,00,000
receivable A/c Dr. 60,000
Insurance company
A/c Dr. 40,000
To Purchases A/c 1,00,000
|
Nabanita Deshpande answered |
And Loss A/c Dr. 40,000
To Suspense A/c 40,000
Explanation:
As the insurance claim of Rs. 60,000 was admitted by the insurance company, the loss suffered by M/s Shine Jewellers is only Rs. 40,000 (Rs. 1,00,000 – Rs. 60,000). As no entry was passed in the books of accounts regarding this loss, the amount should be transferred to a Suspense A/c. Therefore, the journal entry would be to debit the Profit and Loss A/c for Rs. 40,000 and credit the Suspense A/c for the same amount.
To Suspense A/c 40,000
Explanation:
As the insurance claim of Rs. 60,000 was admitted by the insurance company, the loss suffered by M/s Shine Jewellers is only Rs. 40,000 (Rs. 1,00,000 – Rs. 60,000). As no entry was passed in the books of accounts regarding this loss, the amount should be transferred to a Suspense A/c. Therefore, the journal entry would be to debit the Profit and Loss A/c for Rs. 40,000 and credit the Suspense A/c for the same amount.
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Accounting for Grade 9
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