CA Foundation Exam > CA Foundation Questions > X Ltd.’s profit and loss account for th...
Start Learning for Free
X Ltd.’s profit and loss account for the year ended 31st December, 2011 includes the following information
Depreciation – 84,500
Bad Debts – 2,500
Increase in provision for doubtful debts – 22,000
Proposed dividend – 73,200
Retained profit for the year – 1,22,000
Liability of tax – 26,400
State what amounts should be transferred to:- (i) Provisions (ii) Reserves (iii) Neither related to provisions nor reserves
Bad Debts – 2,500
Increase in provision for doubtful debts – 22,000
Proposed dividend – 73,200
Retained profit for the year – 1,22,000
Liability of tax – 26,400
State what amounts should be transferred to:- (i) Provisions (ii) Reserves (iii) Neither related to provisions nor reserves
Prov Res No Prov/Res
- a)1,21,600 1,22,000 87,000
- b)95,200 1,22,000 1,13,400
- c)1,22,000 95,200 Nil
- d)1,22,000 1,21,600 Nil
Correct answer is option 'A'. Can you explain this answer?
| FREE This question is part of | Download PDF Attempt this Test |
Most Upvoted Answer
X Ltd.’s profit and loss account for the year ended 31stDecember...
To determine the amounts that should be transferred to provisions, reserves, and neither, we need to analyze the given information.
Given Information:
- Depreciation: 84,500
- Bad Debts: 2,500
- Increase in provision for doubtful debts: 22,000
- Proposed dividend: 73,200
- Retained profit for the year: 1,22,000
- Liability of tax: 26,400
Based on this information, we can determine the amounts that should be transferred to provisions, reserves, and neither as follows:
(i) Provisions:
- Bad Debts: 2,500 (This is an expense that represents an anticipated loss on uncollectible debts. It should be transferred to provisions as it reduces the profits.)
- Increase in provision for doubtful debts: 22,000 (This represents an increase in the provision made for doubtful debts, which is an anticipated loss. It should be transferred to provisions as it reduces the profits.)
Total amount to be transferred to provisions: 2,500 + 22,000 = 24,500
(ii) Reserves:
- Proposed dividend: 73,200 (This represents the amount proposed to be distributed to shareholders as dividends. It should be transferred to reserves as it reduces the profits.)
Total amount to be transferred to reserves: 73,200
(iii) Neither related to provisions nor reserves:
- Depreciation: 84,500 (Depreciation is a non-cash expense that represents the wear and tear of assets over time. It does not affect the profits directly and should not be transferred to provisions or reserves.)
- Retained profit for the year: 1,22,000 (This represents the profit that is retained in the business and not distributed as dividends. It does not need to be transferred to provisions or reserves as it is already a part of the retained earnings.)
Total amount neither related to provisions nor reserves: 84,500 + 1,22,000 = 2,06,500
Therefore, the correct answer is option 'A': 1,21,600 (to provisions), 1,22,000 (to reserves), and 87,000 (neither related to provisions nor reserves).
Given Information:
- Depreciation: 84,500
- Bad Debts: 2,500
- Increase in provision for doubtful debts: 22,000
- Proposed dividend: 73,200
- Retained profit for the year: 1,22,000
- Liability of tax: 26,400
Based on this information, we can determine the amounts that should be transferred to provisions, reserves, and neither as follows:
(i) Provisions:
- Bad Debts: 2,500 (This is an expense that represents an anticipated loss on uncollectible debts. It should be transferred to provisions as it reduces the profits.)
- Increase in provision for doubtful debts: 22,000 (This represents an increase in the provision made for doubtful debts, which is an anticipated loss. It should be transferred to provisions as it reduces the profits.)
Total amount to be transferred to provisions: 2,500 + 22,000 = 24,500
(ii) Reserves:
- Proposed dividend: 73,200 (This represents the amount proposed to be distributed to shareholders as dividends. It should be transferred to reserves as it reduces the profits.)
Total amount to be transferred to reserves: 73,200
(iii) Neither related to provisions nor reserves:
- Depreciation: 84,500 (Depreciation is a non-cash expense that represents the wear and tear of assets over time. It does not affect the profits directly and should not be transferred to provisions or reserves.)
- Retained profit for the year: 1,22,000 (This represents the profit that is retained in the business and not distributed as dividends. It does not need to be transferred to provisions or reserves as it is already a part of the retained earnings.)
Total amount neither related to provisions nor reserves: 84,500 + 1,22,000 = 2,06,500
Therefore, the correct answer is option 'A': 1,21,600 (to provisions), 1,22,000 (to reserves), and 87,000 (neither related to provisions nor reserves).
Attention CA Foundation Students!
To make sure you are not studying endlessly, EduRev has designed CA Foundation study material, with Structured Courses, Videos, & Test Series. Plus get personalized analysis, doubt solving and improvement plans to achieve a great score in CA Foundation.
|
Explore Courses for CA Foundation exam
|
|
Top Courses for CA FoundationView all
X Ltd.’s profit and loss account for the year ended 31stDecember, 2011 includes the followinginformationDepreciation –84,500Bad Debts – 2,500Increase in provision for doubtful debts – 22,000Proposed dividend – 73,200Retained profit for the year – 1,22,000Liability of tax – 26,400State what amounts should be transferred to:- (i) Provisions (ii) Reserves (iii) Neither related to provisions nor reserves Prov Res No Prov/Resa)1,21,600 1,22,000 87,000b)95,200 1,22,000 1,13,400c)1,22,000 95,200 Nild)1,22,000 1,21,600 NilCorrect answer is option 'A'. Can you explain this answer?
Question Description
X Ltd.’s profit and loss account for the year ended 31stDecember, 2011 includes the followinginformationDepreciation –84,500Bad Debts – 2,500Increase in provision for doubtful debts – 22,000Proposed dividend – 73,200Retained profit for the year – 1,22,000Liability of tax – 26,400State what amounts should be transferred to:- (i) Provisions (ii) Reserves (iii) Neither related to provisions nor reserves Prov Res No Prov/Resa)1,21,600 1,22,000 87,000b)95,200 1,22,000 1,13,400c)1,22,000 95,200 Nild)1,22,000 1,21,600 NilCorrect answer is option 'A'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about X Ltd.’s profit and loss account for the year ended 31stDecember, 2011 includes the followinginformationDepreciation –84,500Bad Debts – 2,500Increase in provision for doubtful debts – 22,000Proposed dividend – 73,200Retained profit for the year – 1,22,000Liability of tax – 26,400State what amounts should be transferred to:- (i) Provisions (ii) Reserves (iii) Neither related to provisions nor reserves Prov Res No Prov/Resa)1,21,600 1,22,000 87,000b)95,200 1,22,000 1,13,400c)1,22,000 95,200 Nild)1,22,000 1,21,600 NilCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for X Ltd.’s profit and loss account for the year ended 31stDecember, 2011 includes the followinginformationDepreciation –84,500Bad Debts – 2,500Increase in provision for doubtful debts – 22,000Proposed dividend – 73,200Retained profit for the year – 1,22,000Liability of tax – 26,400State what amounts should be transferred to:- (i) Provisions (ii) Reserves (iii) Neither related to provisions nor reserves Prov Res No Prov/Resa)1,21,600 1,22,000 87,000b)95,200 1,22,000 1,13,400c)1,22,000 95,200 Nild)1,22,000 1,21,600 NilCorrect answer is option 'A'. Can you explain this answer?.
X Ltd.’s profit and loss account for the year ended 31stDecember, 2011 includes the followinginformationDepreciation –84,500Bad Debts – 2,500Increase in provision for doubtful debts – 22,000Proposed dividend – 73,200Retained profit for the year – 1,22,000Liability of tax – 26,400State what amounts should be transferred to:- (i) Provisions (ii) Reserves (iii) Neither related to provisions nor reserves Prov Res No Prov/Resa)1,21,600 1,22,000 87,000b)95,200 1,22,000 1,13,400c)1,22,000 95,200 Nild)1,22,000 1,21,600 NilCorrect answer is option 'A'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about X Ltd.’s profit and loss account for the year ended 31stDecember, 2011 includes the followinginformationDepreciation –84,500Bad Debts – 2,500Increase in provision for doubtful debts – 22,000Proposed dividend – 73,200Retained profit for the year – 1,22,000Liability of tax – 26,400State what amounts should be transferred to:- (i) Provisions (ii) Reserves (iii) Neither related to provisions nor reserves Prov Res No Prov/Resa)1,21,600 1,22,000 87,000b)95,200 1,22,000 1,13,400c)1,22,000 95,200 Nild)1,22,000 1,21,600 NilCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for X Ltd.’s profit and loss account for the year ended 31stDecember, 2011 includes the followinginformationDepreciation –84,500Bad Debts – 2,500Increase in provision for doubtful debts – 22,000Proposed dividend – 73,200Retained profit for the year – 1,22,000Liability of tax – 26,400State what amounts should be transferred to:- (i) Provisions (ii) Reserves (iii) Neither related to provisions nor reserves Prov Res No Prov/Resa)1,21,600 1,22,000 87,000b)95,200 1,22,000 1,13,400c)1,22,000 95,200 Nild)1,22,000 1,21,600 NilCorrect answer is option 'A'. Can you explain this answer?.
Solutions for X Ltd.’s profit and loss account for the year ended 31stDecember, 2011 includes the followinginformationDepreciation –84,500Bad Debts – 2,500Increase in provision for doubtful debts – 22,000Proposed dividend – 73,200Retained profit for the year – 1,22,000Liability of tax – 26,400State what amounts should be transferred to:- (i) Provisions (ii) Reserves (iii) Neither related to provisions nor reserves Prov Res No Prov/Resa)1,21,600 1,22,000 87,000b)95,200 1,22,000 1,13,400c)1,22,000 95,200 Nild)1,22,000 1,21,600 NilCorrect answer is option 'A'. Can you explain this answer? in English & in Hindi are available as part of our courses for CA Foundation.
Download more important topics, notes, lectures and mock test series for CA Foundation Exam by signing up for free.
Here you can find the meaning of X Ltd.’s profit and loss account for the year ended 31stDecember, 2011 includes the followinginformationDepreciation –84,500Bad Debts – 2,500Increase in provision for doubtful debts – 22,000Proposed dividend – 73,200Retained profit for the year – 1,22,000Liability of tax – 26,400State what amounts should be transferred to:- (i) Provisions (ii) Reserves (iii) Neither related to provisions nor reserves Prov Res No Prov/Resa)1,21,600 1,22,000 87,000b)95,200 1,22,000 1,13,400c)1,22,000 95,200 Nild)1,22,000 1,21,600 NilCorrect answer is option 'A'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of
X Ltd.’s profit and loss account for the year ended 31stDecember, 2011 includes the followinginformationDepreciation –84,500Bad Debts – 2,500Increase in provision for doubtful debts – 22,000Proposed dividend – 73,200Retained profit for the year – 1,22,000Liability of tax – 26,400State what amounts should be transferred to:- (i) Provisions (ii) Reserves (iii) Neither related to provisions nor reserves Prov Res No Prov/Resa)1,21,600 1,22,000 87,000b)95,200 1,22,000 1,13,400c)1,22,000 95,200 Nild)1,22,000 1,21,600 NilCorrect answer is option 'A'. Can you explain this answer?, a detailed solution for X Ltd.’s profit and loss account for the year ended 31stDecember, 2011 includes the followinginformationDepreciation –84,500Bad Debts – 2,500Increase in provision for doubtful debts – 22,000Proposed dividend – 73,200Retained profit for the year – 1,22,000Liability of tax – 26,400State what amounts should be transferred to:- (i) Provisions (ii) Reserves (iii) Neither related to provisions nor reserves Prov Res No Prov/Resa)1,21,600 1,22,000 87,000b)95,200 1,22,000 1,13,400c)1,22,000 95,200 Nild)1,22,000 1,21,600 NilCorrect answer is option 'A'. Can you explain this answer? has been provided alongside types of X Ltd.’s profit and loss account for the year ended 31stDecember, 2011 includes the followinginformationDepreciation –84,500Bad Debts – 2,500Increase in provision for doubtful debts – 22,000Proposed dividend – 73,200Retained profit for the year – 1,22,000Liability of tax – 26,400State what amounts should be transferred to:- (i) Provisions (ii) Reserves (iii) Neither related to provisions nor reserves Prov Res No Prov/Resa)1,21,600 1,22,000 87,000b)95,200 1,22,000 1,13,400c)1,22,000 95,200 Nild)1,22,000 1,21,600 NilCorrect answer is option 'A'. Can you explain this answer? theory, EduRev gives you an
ample number of questions to practice X Ltd.’s profit and loss account for the year ended 31stDecember, 2011 includes the followinginformationDepreciation –84,500Bad Debts – 2,500Increase in provision for doubtful debts – 22,000Proposed dividend – 73,200Retained profit for the year – 1,22,000Liability of tax – 26,400State what amounts should be transferred to:- (i) Provisions (ii) Reserves (iii) Neither related to provisions nor reserves Prov Res No Prov/Resa)1,21,600 1,22,000 87,000b)95,200 1,22,000 1,13,400c)1,22,000 95,200 Nild)1,22,000 1,21,600 NilCorrect answer is option 'A'. Can you explain this answer? tests, examples and also practice CA Foundation tests.
|
|
Explore Courses for CA Foundation exam
|
|
Suggested Free Tests
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
|
© EduRev
|
Education Revolution
|
Follow Us
|
Signup to see your scores
go up within 7 days!
Access 1000+ FREE Docs, Videos and Tests
Takes less than 10 seconds to signup