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What will be the treatment of “accrued income” if appearing in the Trial Balance:
- a)It will be shown on the assets side as current assets in the balance sheet.
- b)It will be shown on the liability side as current liability in the balance sheet.
- c)It will be shown on the debit side of trading account as an expense.
- d)It will be shown on the credit side of profit and loss account as an income.
Correct answer is option 'A'. Can you explain this answer?
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What will be the treatment of “accrued income” if appearin...
Explanation:
Accrued Income in Trial Balance:
- Accrued income refers to the income that has been earned but not yet received or recorded in the accounting books.
- When accrued income appears in the trial balance, it is treated as an asset because the business has the right to receive the income in the future.
Treatment in Balance Sheet:
- Accrued income will be shown on the assets side as current assets in the balance sheet. This is because it represents the amount of income that the business is entitled to receive in the future.
Importance of Correct Treatment:
- Showing accrued income as an asset in the balance sheet provides a clear picture of the financial position of the business.
- It ensures that the income is not overlooked and is accounted for accurately in the financial statements.
Conclusion:
- Accrued income appearing in the trial balance is treated as a current asset in the balance sheet to reflect the amount of income that the business has earned but not yet received. This treatment ensures the accurate representation of the financial position of the business.
Accrued Income in Trial Balance:
- Accrued income refers to the income that has been earned but not yet received or recorded in the accounting books.
- When accrued income appears in the trial balance, it is treated as an asset because the business has the right to receive the income in the future.
Treatment in Balance Sheet:
- Accrued income will be shown on the assets side as current assets in the balance sheet. This is because it represents the amount of income that the business is entitled to receive in the future.
Importance of Correct Treatment:
- Showing accrued income as an asset in the balance sheet provides a clear picture of the financial position of the business.
- It ensures that the income is not overlooked and is accounted for accurately in the financial statements.
Conclusion:
- Accrued income appearing in the trial balance is treated as a current asset in the balance sheet to reflect the amount of income that the business has earned but not yet received. This treatment ensures the accurate representation of the financial position of the business.
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What will be the treatment of “accrued income” if appearin...
Accrued income is the uncome earned but not received it is shown on the asset side of the balance sheet.
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What will be the treatment of “accrued income” if appearing in the Trial Balance:a)It will be shown on the assets side as current assets in the balance sheet.b)It will be shown on the liability side as current liability in the balance sheet.c)It will be shown on the debit side of trading account as an expense.d)It will be shown on the credit side of profit and loss account as an income.Correct answer is option 'A'. Can you explain this answer?
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What will be the treatment of “accrued income” if appearing in the Trial Balance:a)It will be shown on the assets side as current assets in the balance sheet.b)It will be shown on the liability side as current liability in the balance sheet.c)It will be shown on the debit side of trading account as an expense.d)It will be shown on the credit side of profit and loss account as an income.Correct 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 What will be the treatment of “accrued income” if appearing in the Trial Balance:a)It will be shown on the assets side as current assets in the balance sheet.b)It will be shown on the liability side as current liability in the balance sheet.c)It will be shown on the debit side of trading account as an expense.d)It will be shown on the credit side of profit and loss account as an income.Correct 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 What will be the treatment of “accrued income” if appearing in the Trial Balance:a)It will be shown on the assets side as current assets in the balance sheet.b)It will be shown on the liability side as current liability in the balance sheet.c)It will be shown on the debit side of trading account as an expense.d)It will be shown on the credit side of profit and loss account as an income.Correct answer is option 'A'. Can you explain this answer?.
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