P shows a profit of Rs. 7,00,000 for the year ended 31.3.08. The figure has been arrived at after charging following against revenue:
(i) Purchase of Car on 28.3.08 for use in business Rs. 1,00,000 and treated as vehicle expenses.
(ii) Omitting to record unpaid electricity bills for Feb. and March, 2008 of Rs. 15,000 per month. The correct profit for the year ended 31st March, 2008 is
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Solution
Correct profit will be Rs. 7,70,000 (Rs. 7,00,000 + 1,00,000 less Rs. 30,000).
Profit and loss of realization account is shared among the partners in _______ ratio
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Solution
Profit/loss on realization is shared among partners in old profit sharing ratio.
Prepaid expenses refer to those expense which have been
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Solution
Expenses paid but not incurred during current accounting period are prepaid.
The left hand side of an account is known as _________ and the right hand side of an account is known as ________
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Solution
Left side is debit side and right side is credit side of an account.
Provision is
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Solution
A known liability is provision if its amount and due date are indeterminate.
A ___________ is sent to a customer when he returns goods
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Solution
Credit note is sent when customer returns goods.
Noting charges are paid at the time of _____________ of the bill
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Solution
Noting charges are paid at time of dishonour of bill.
Interest on Partner’s capital is _________
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Solution
Interest on partner’s capital is appropriation and not expense.
General reserve at the time of retirement of a partner is transferred to_______
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Solution
General reserve is transferred to partner’s capital account at time of retirement of partner.
If effect of an error is cancelled by the effect of some other error, it is commonly known as _____________
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Solution
In compensating errors, effect of one error is cancelled by effect of some other error.