Which of the following statement is not true?
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Solution
If del-credere commission is allowed bad debts will not be borne by consignor, thus not debited to consignment etc
Which of the following are of capital nature?
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Solution
Wages paid for installation of machinery is a capital item
Which of the following errors are not revealed by the Trial Balance?
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Solution
Compensating errors are not revealed by trail balance.
Fundamental accounting assumption is
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Solution
Going concern is fundamental accounting assumption.
In the absence of any provision in the partnership agreement, profits and losses are shared
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Solution
In the absence of provision in the partnership agreement, profit and losses are shared equally.
While finalizing the current year’s profit, the company realized that there was an error in the valuation of closing inventory of the previous year. In the previous year, closing inventory was valued more by Rs.50,000. As a result
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Solution
Due to this error, previous year’s profit is overstated and current year’s profit is understated.
A Bank Reconciliation Statement is prepared to know the causes for the difference between:
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Solution
A bank reconciliation statement is prepared to know the causes for the difference between balances as per bank column of the cash book and pass book.
Purchases book records:
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Solution
Purchases book records all credit purchases of the goods in trade.
A change in accounting policy is justified
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Solution
A change in accounting policy is justified due to all the three options given in the question.
RPC Ltd. follows the written down value method of depreciating machinery year after year by applying the principle of
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Solution
Same method of depreciation is followed year after year due to consistency