Practice Test 42
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Outstanding salary account is

  • Solution

    Outstanding salry is personal account as it is due to some person.

Rs.5,000 spent to remove a worn out part and replace it with a new one is

  • Solution

    Expenditure for replacement of a part is revenue expenditure in the given case.

According to the provisions of the Reserve Bank of India, a promissory note cannot be made payable to the

  • Solution

    A promissory note cannot be made payable to bearer

A bill of exchange when drawn requires

  • Solution

    A bill of exchange requires acceptance.

The term depletion is used for

  • Solution

    ‘Depletion’ is used for natural resources.

All of the following have debit balance except

  • Solution

    Wages, Trade receivable, goodwill all have Dr. balance. Bills payable (liability) has Cr balance.

Errors of commission do not permit

  • Solution

    Errors of commission donot permit trail balance to agree.

Double column cash book records

  • Solution

    Double column cash book records all cash and bank transactions.

Which of the following is correct?

  • Solution

    Capital is equal to assets less liabilities.

It is generally assumed that the business will not liquidate in the near foreseeable future because of______________ concept.

  • Solution

    Going concern concept assumes that the business will continue for long and will not liquidate in near future.

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FUNDAMENTALS OF ACCOUNTING
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