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This section includes InterviewSolutions, each offering curated multiple-choice questions to sharpen your knowledge and support exam preparation. Choose a topic below to get started.
| 2052. |
Capital Reserves are freely distrbuted as profits. Comment. |
| Answer» Solution :No. CAPITAL RESERVE are not FREELY distributed as PROFITS. | |
| 2053. |
Capital Receipts are shown in |
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Answer» BALANCE SHEET |
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| 2054. |
Capital Receipts and Revenue Receipts need not be distinguished to determine net profit. |
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Answer» |
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| 2055. |
Capital of Ganesh Gupta in the beginning of the year was Rs. 70,000. During the year his business earned a profit of Rs. 20,000, he withdrew Rs. 7,000 for his personal use.He sold ornaments of his wife for Rs. 20,000 and invested that amount into the business. Find out his Capital at the end of the year. |
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Answer» |
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| 2056. |
Capital Receipts and Revenue Receipts |
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Answer» MUST be DISTINGUISHED |
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| 2058. |
"Capital is a liability for the business." Explain this statement with the principle applied. |
| Answer» SOLUTION :EXPLAIN BUSINESS ENTITY CONCEPT. | |
| 2059. |
Capital in the beginning of the accounting year ascertained by preparing |
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Answer» DEBTORS' Account. |
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| 2060. |
Capital is a liability for the business ,. Explain statement with the principle applied. |
| Answer» Solution :According to Accounting Entity or Business EntityPrinciple capital is a liability for the business . This principle requires that for accounting PURPOSE , a DISTINCTION should be made between business affairs and personal affaired and in the accounting BOOKS of the business only business transaction be recorded . The AMOUNT INVESTED by the ownerfrom the business for his personal use is recorded in Drawings Account . The amount in the credit of the Capital Account is a liability of the business towards the owner . | |
| 2061. |
Capital is |
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Answer» INTERNAL LIABILITY |
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| 2062. |
Capital in the beginning and capitalat the end are usually ascertained as the balancing figures of ________ prepared on the relevant accounting dates. |
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Answer» |
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| 2064. |
Capital expenditure is included in |
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Answer» TRADING Account |
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| 2065. |
Capital Expenditure and Revenue Expenditure should be distinguished to determined net profit. |
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Answer» |
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| 2066. |
Capital Account is a |
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Answer» Natural PERSONAL Account |
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| 2067. |
(Calculation of Total Purchases). From the following information, calculate Total Purchases: |{:(,"Rs."),("Opening Balance of Bills Payable","15,000"),("Opening Balance of Creditors","18,000"),("Closing Balacne of Bills Payable","21,000"),("Closing Balacne of Creditors","12,000"):}||{:(,"Rs."),("Cash Paid to Creditors during the year","90,600"),("Bills Payable Dischargod during the year","26,700"),("Pruchases Return","3,600"),("Cash Purchases","77,400"):}| |
Answer» SOLUTION : TOTAL PURCHASES = CASH Purchases = RS. 77,400 + Rs. 1,20,900 = Rs. 1,98,300. |
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| 2068. |
Calculate total liability if: 1. Owner's capital in the beginning is ₹60,000. 2, Creditors at theis ₹50,000. 3. Revenueduring the period the period is ₹70,000. 4. Expenses duringthe periodare ₹65,000. Also calculate amountof owner's capital at theend. |
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Answer» Solution :TotalLiability = Ower's CAPITALAT the end + Creditor `"" =₹65,000 + ₹50,000 = ₹1,15,000`. OWNER's CAPITAL at theend= Owner's + ₹70,000- ₹65,000 = ₹65,000. |
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| 2069. |
Calculate Total Sales from the following information: {:(,"Rs."),("Bills Receivables as on 1st April, 2018","7,800"),("Cash received on maturity of Bills Receivable during the year","30,800"),("Cash received from Debtors","20,900"),("Cash received from Debtors","70,000"),("Bad Debts written off"," 4,800"),("Returns Inward"," 8,700"),("Bills Receivable dishonoured"," 1,800"),("Bills Receivable on 31st March, 2019"," 6,000"),("Debtors as on 31st March, 2019","25,500"),("Cash Sales during the year","15,900"):} |
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Answer» |
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| 2070. |
Calculate total liability if: 1. Owner's capital in the beginning is ₹60,000. 2, Creditors at theis ₹50,000. 3. Revenueduring the period the period is ₹70,000. 4. Expenses duringthe periodare ₹65,000. Also calculate amountof owner's capital at theend. |
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Answer» SOLUTION :TotalLiability = Ower's CAPITALAT the end + CREDITOR `"" =₹65,000 + ₹50,000 = ₹1,15,000`. OWNER's Capital at theend= Owner's + ₹70,000- ₹65,000 = ₹65,000. |
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| 2071. |
Calculate total assets if : Captialis ₹2,00,000, Creditors₹50,000, Revnue during the years₹5,00,000, andExpensesduring the years ₹4,00,000. |
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Answer» |
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| 2072. |
Calculate total assets if : Captialis ₹2,00,000, Creditors₹50,000, Revnue during the years₹5,00,000, andExpensesduring the years ₹4,00,000. |
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Answer» |
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| 2073. |
Calculate the total assets if : (i) Capital is ₹400. (ii)Creditorsare ₹25,000. (iii) Revenueduring the period ₹50,000. ltbr. (iv) Expenses duringthe periodare ₹40,000. |
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Answer» |
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| 2074. |
Calculate the total assets if : (i) Capital is ₹400. (ii)Creditorsare ₹25,000. (iii) Revenueduring the period ₹50,000. ltbr. (iv) Expenses duringthe periodare ₹40,000. |
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Answer» |
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| 2075. |
Calculate the stock at the end: |
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Answer» Solution :CLOSING STOCK = OPENING Stock + Purchases + Gross Profit - Sales = Rs. 10,000 + Rs. 35,000 + Rs. `12,500^(**)`- Rs. 50,000 = Rs. 7,500. `.^(**)"Gross"` Profit = 1/3 of Cost = 1/4 of Sales =`1//4xx` Rs. 50,000 = Rs. 12,500. |
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| 2076. |
{:("Calculate the value of Closing Stock from the following information:"," Rs."),("Purchases","93,000"),("Wages","20,000"),("Sales","40,000"),("Purchases","1,20,000"),("Carriage Outwards","3,200"),("Rate of Gross Profit "25%" on Cost.","16,000"):} |
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Answer» SALES = Cost + Profit = Rs. 100 + Rs. 25 = Rs. 125, Gross Profit on Sales = Rs. 25/Rs. 125 or 1/5 on Sales, i.e., Rs. `1,20,0000xx1//5=Rs. 24,000.` |
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| 2077. |
Calculate the amount of Total Purchases from the following information: Opening Creditors Rs. 30,000, Closing Creditors Rs. 50,000, Cash paid to Creditors during the year Rs. 60,000, Cash Purchases Rs. 20,000. |
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Answer» SOLUTION :TOTAL Purchases = CREDIT Purchases + CASH Purchases `=(RS. 50,000 + Rs. 60,000 - Rs. 30,000)+ Rs. 20,000 = Rs. 1,00,000.` |
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| 2078. |
{:("Calculate Stock in the beginning:","Rs."),("Sales","80,000"),("Purchases","60,000"),("Stock at the end","8,000"),("Loss on Cost","1/6"):} |
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Answer» |
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| 2079. |
{:("Calculate Stock at the end:","Rs."),("Stock in the beginning","20,000"),("Cash Sales","60,000"),("Credit Sales","40,000"),("Purchases","70,000"),("Rate of Gross Profit on Cost","1/3"):} |
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Answer» |
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| 2080. |
Calculate Net Sales and Gross Profit from the following information: Cost of Goods Sold Rs 1,00,000, Gross Profit 20% on Sales |
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Answer» Solution :If Sales is RS 100, Gross Profit = 20% on Sales = Rs 20 `:.` COST will be Rs 80 (i.e., `Rs 100 - Rs 20`) If Cost of Goods Sold `= Rs 1,00,000`, Sales `= Rs 1,00,000 xx Rs 100//Rs 80 = Rs 1,25,000` Gross Profit = Sales - Cost of Goods Sold `= Rs 1,25,000 - Rs 1,00,000 = Rs 25,000` |
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| 2081. |
Calculate Gross Profit when Totla Purchases during the year are Rs 8,00,000, Returns Outward Rs 20,000, Direct Expenses Rs 60,000 and 2/3rd of the goods are sold for Rs 6,10,000. |
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Answer» Solution :Cost of GOODS Sold = TOTAL Purchases - Returns Outward + Direct Expenses `= Rs 8,00,000 - Rs 20,000 + Rs 60,000 = Rs 8,40,000` A. 2/3rd of the Goods sold for Rs 6,10,000 B. 2/3rd Cost of Goods Sold `= Rs 8,40,000 XX 2//3 = Rs 5,60,000` Gross PROFIT `= A - B = Rs 6,10,000 - Rs 5,60,000 = Rs 50,000` |
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| 2082. |
Calculate credit sales from the following details: Opening Debtors Rs. 2,50,000, Closing Debtors Rs. 3,00,000, Cash received from Debtors Rs. 7,50,000, Discount allowed to Debtors Rs. 50,000. |
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Answer» Solution :Credit Sales = Cash Received + DISCOUNT Allowed + CLOSING Debtors - OPENING Debtors = Rs. 7,50,000 + Rs. 50,000 + Rs. 3,00,000 - Rs. 2,50,000 = Rs. 8,50,000. |
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| 2083. |
Calculate closing stock from the following details: Opening Stock - Rs 20,000, Cash Sales - Rs 60,000, Credit Sales - Rs 40,000, Purchase - Rs 70,000 Rate of Gross Profit on Cost 33(1)/(3)% |
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Answer» Solution :Total Sales = Cash Sales + Credit Sales = Rs 1,00,000 Let Cost be Rs 100, GROSS Profit `= 33 (10)/(3)%` on Cost `= Rs 33(1)/(3)`, Sales `= Rs 133(1)/(3)` Gross Profit on Sales `= Rs 33(1)/(3) //Rs 133 (1)/(3) = (1)/(4)` Gross Profit `= Rs 1,00,000 xx (1)/(4) = Rs 25,000` Cost of Goods Sold = Sales - Gross Profit `= Rs 1,00,000 - Rs 25,000 = Rs 75,000` Cost of Goods Sold = OPENING Stock + PURCHASES - Closing Stock `Rs 75,000 = Rs 20,000 + Rs 70,000 -` Closing Stock Closing Stock `= Rs 20,000 + Rs 70,000 - Rs 75,000 = Rs 15,000` |
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| 2084. |
Calculate closing capital: Opening capital Rs. 70,000, Profit for the year Rs. 20,000, Drawings Rss. 7,000. During the year proprietor sold ornaments of his wife for Rs. 20,000 and invested the same in business. |
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Answer» SOLUTION :CLOSING Capital = Opening Capital `+` PROFIT `+` ADDITIONAL Capital Introduced `-` DRAWINGS = Rs. 70,000 `+` Rs. 20,000 `+` rs. 20,000 `-` Rs. 7,000 = Rs. 1,03,000. |
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| 2086. |
Calculate closing stock and cost of goods sold: Opening Stock Rs 5,000, Sales Rs 16,000, Carriage Inwards Rs 1,000. Sales Return Rs 1,000, Gross Profit Rs 6,000, Pruchases Rs 10,000, Purchases Return Rs 900. |
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Answer» Solution :Cost of Goods Sold = Net SALES (i.e., Sales - Sales Return) - GROSS Profit `= Rs 15,000 - Rs 6,000 = Rs 9,000` Cost of Goods Sold = OPENING Stock + Net Purchases + Carriage Inwards - CLOSING Stock `Rs 9,000 = Rs 5,000 + Rs 9,100` (i.e., `Rs 10,000 - Rs 900`) `+ 1,00 -` Closing Stock Closing Stock = Rs 6,100 |
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| 2087. |
Calculate cash flows from operating activities from the following information. Working Notes: 1.Other Income = Profit on Sale of Machinery (Rs 2,000 ) + Income Tax Refund (Rs 3,000) = Rs 5,00 2.Depreciation and Amortisation Expenses= Depreciation (Rs 5,000) + Goodwill Amortised (Rs 2,000)Other Expenses=Rent (Rs 10,000) + Loss on Sale of Equipment (Rs 3,000) + Provision for Taxation (Rs 8,000)ltbrge = Rs 21,000 Additional Information: |
Answer» Solution :  Working Notes: 1. Net profit before taxation & extraordinary ITEM = RS 2,000 + Rs 8,000 – Rs 3,000= Rs 7,000 2. Income tax paid during the year has been ascertained by PREPARING provision for taxation ACCOUNT as follows: 
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| 2088. |
By providing for discount on debtors, which accounting concept is followed ? |
| Answer» SOLUTION :PRUDENCE CONCEPT. | |
| 2089. |
Business transactions are recorded in the order in which they ________ |
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Answer» |
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| 2090. |
Business transactions are recorded |
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Answer» in CHRONOLOGICAL ORDER. |
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| 2091. |
Business Entity Concept is not applicable to sole trading concerns and partnership concerns. |
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Answer» |
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| 2092. |
Business Entity Concept implies that a business unit is _______ from the person who supply capital to it. |
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Answer» |
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| 2093. |
Briefly explain the Petty Cash Book. |
| Answer» SOLUTION :Petty CASH Book is the Cash Book in which EXPENSES involving SMALL amount are RECORDED. | |
| 2094. |
Brifly explain the elements of Statement of Financial Position. |
| Answer» Solution :Assets : Assets are the resources controlled by the enterprise as a result of past EVENTS and operations fromwhich the FUTURE economic benefits SHALL flow to the enterprises.Thus , assets shall include TANGIBLE and INTANGIBLE assets , which an enterprise owns. Liabilities : Liabilities are the obligations of the enterprisefrom the past events and operations , which shall result in outflow of resources , i.e., assets. Equity : Equity is the difference between the assets and liabilities. | |
| 2095. |
Brifly explainyour understanding of IFRS. |
| Answer» Solution :IFRS are the accounting STANDARDS issued by the IASB , RECOMMENDED to be used by the enterprises globally to produce financial statement FOLLOWING a single aet of accounting standards . IFRS are principle based accounting standards in comparison to rule based Indian Accounting Standards , Also they are based on fair value concept. | |
| 2096. |
Briefly explain your understanding of Ind -AS. |
| Answer» Solution :Ind -AS are the accounting STANDARDS issued by the Ministry of Corporate Affaairs, GOVERNMENT of Indian , and notified under the Companies Act , 2013 prescribed to be used by the ENTERPRISES to prepare finanicial statements . They are principle based accounting standards in comparison to RULE based Accounting Standards .Also they are based on fair value concept. | |
| 2098. |
Briefly explain the elemants of Statement of Comprehensive Income. |
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Answer» SOLUTION :A Statement ofComprehensive Income Comprises of two statement , i.e., Income Statement and a Comprehensive Income are prepared . The Statement ofCompprehensive Income reconciles the income or LOSS as per income Statement with total comprehensive income . the elements or contents of the statement are : (i)Revenue : It increases the economic benefit during the accounting period because of business operationsand /or INCREASE in the value of assets or decrease in liabilities .As a result of it , value of SHAREHOLDERS equity increases. (ii) Expense : It is a decrease ineconomic BENEFITS in the form of outflows during the accounting period because of business operations and /or decrease in the value of sharehloders equity decreases . |
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| 2099. |
Briefly explain the Accounting Equation. |
| Answer» SOLUTION : The accounting EQUATION is a mathematical equation which shows that the ASSETS andliabilities of a firm are equal, i.e., Assets = Liabilities ASPECT Concept of Accounting. | |
| 2100. |
Briefly explain Expenditure |
| Answer» Solution :EXPENDITURE is the AMOUNT spent or liability incurred for acquiring ASSETS, goods or SERVICES | |