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Mohan purchased goods for Rs. 15,00,000 and sold 4/5th of the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?
- a)Entity.
- b)Periodicity.
- c)Matching.
- d)Conservatism.
Correct answer is option 'C'. Can you explain this answer?
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Most Upvoted Answer
Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amo...
Matching Concept
Explanation:
The matching concept is an accounting principle that states that expenses should be recognized in the same accounting period as the revenues they helped to earn. In other words, the expenses incurred to generate revenues must be recognized in the same period as the revenues are recognized. This principle is used to determine the net income or net loss of a business.
In this case, Mohan purchased goods for Rs. 15,00,000 and sold 4/5th of the goods amounting Rs. 18,00,000 during the year 2011. He also met expenses amounting to Rs. 2,50,000 during the same year. According to the matching concept, the expenses incurred to generate the revenue of Rs. 18,00,000 should be recognized in the same period as the revenue.
Mohan recognized the expenses incurred during the year and deducted them from the revenue earned during the same period. This resulted in a net profit of Rs. 3,50,000. By following the matching concept, Mohan ensured that he accurately reflected the true profit of his business for the year 2011.
Therefore, the accounting concept followed by Mohan is the Matching Concept.
Explanation:
The matching concept is an accounting principle that states that expenses should be recognized in the same accounting period as the revenues they helped to earn. In other words, the expenses incurred to generate revenues must be recognized in the same period as the revenues are recognized. This principle is used to determine the net income or net loss of a business.
In this case, Mohan purchased goods for Rs. 15,00,000 and sold 4/5th of the goods amounting Rs. 18,00,000 during the year 2011. He also met expenses amounting to Rs. 2,50,000 during the same year. According to the matching concept, the expenses incurred to generate the revenue of Rs. 18,00,000 should be recognized in the same period as the revenue.
Mohan recognized the expenses incurred during the year and deducted them from the revenue earned during the same period. This resulted in a net profit of Rs. 3,50,000. By following the matching concept, Mohan ensured that he accurately reflected the true profit of his business for the year 2011.
Therefore, the accounting concept followed by Mohan is the Matching Concept.
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Community Answer
Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amo...
Total goods amounted to ₹1500000
4/5th part was sold = 1500000 × 4/5=1200000
actually profit = 1800000-1200000=600000
expenses =250000
therefore total profit =600000-250000=350000
thus revenue is equal to the expense
I.e 350000= 350000
hence ans is c - matching
4/5th part was sold = 1500000 × 4/5=1200000
actually profit = 1800000-1200000=600000
expenses =250000
therefore total profit =600000-250000=350000
thus revenue is equal to the expense
I.e 350000= 350000
hence ans is c - matching
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Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is option 'C'. Can you explain this answer?
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Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is option 'C'. 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 Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is option 'C'. 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 Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is option 'C'. Can you explain this answer?.
Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is option 'C'. 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 Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is option 'C'. 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 Mohan purchased goods for Rs. 15,00,000 and sold 4/5thof the goods amounting Rs. 18,00,000 and met expenses amounting Rs. 2,50,000 during the year, 2011. He counted net profit as Rs. 3,50,000. Which of the accounting concept was followed by him?a)Entity.b)Periodicity.c)Matching.d)Conservatism.Correct answer is option 'C'. Can you explain this answer?.
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