Consignment account is
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Solution
Consignment A/c is nominal as it shows profit/loss.
Contra entries are passed only when
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Solution
Contra entries are passed in three column cash book.
A withdrawal of cash from business by the proprietor should be credited to:
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Solution
Withdrawal by proprietor are debited to drawings A/c and credited to Cash A/c.
The debts written off as bad, if recovered subsequently are
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Solution
Bad debts recovered are credited to Bad debts recovered amount.
A purchased a car for Rs.5,00,000, making a down payment of Rs. 1,00,000 and signing a Rs. 4,00,000 bill payable due in 60 days. As a result of this transaction
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Solution
Since we follow dual aspect concept
So either it is increase in one asset and decrease in other
Or its increase in asset and increase in liability
In the asset side:
Increase in fixed asset (car) = 5,00,000
Decrease in cash in hand = 1,00,000
Thus total increase in asset = Rs. 4,00,000
In the liabilities side:
Increase in bills payable = Rs. 4,00,000
Thus Total assets increased by Rs. 4,00,000 with corresponding increase in liabilities by Rs. 4,00,000
Which financial statement represents the accounting equation, Assets = Liabilities + Owner’s equity?
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Solution
Balance sheet represents accounting equation.
Financial statements only consider
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Solution
Financial statements consider assets and liabilities expressed in money terms.
On March 31, 2010 after sale of goods worth Rs. 2,000, he is left with the closing inventory of Rs. 10,000. This is
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Solution
It is an event not a transaction.
Manufacturing account is prepared to
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Solution
Manufacturing account is required to calculate cost of manufactured goods.
All of the following are functions of Accounting except
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Solution
Ledger posting is not a function of accounting, it is work of book keeping.