Tag: prepration of income and expenditure account and balance sheet

Questions Related to prepration of income and expenditure account and balance sheet

________is/are example(s) of capital receipts.

book keeping and accountancy accounts of 'not for profit' concerns receipts and payments receipts and payments account prepration of income and expenditure account prepration of income and expenditure account and balance sheet

  1. Sale proceed of fixed asset

  2. Loan raised from financial institutions

  3. Capital raised through book building process

  4. All of the above

Show answer
Correct Option: D
Explanation:

b'Option D is correct. Capital receipts refer to those receipts which either create a liability or cause a reduction in the assets of the firm. They are non-recurring or non-routine in nature. Sale proceeds of fixed assets leads to reduction in assets. Loan and Capital raised create liability for firm. All are capital receipts. '

________ is/are a capital receipt.

book keeping and accountancy accounts of 'not for profit' concerns receipts and payments receipts and payments account prepration of income and expenditure account prepration of income and expenditure account and balance sheet

  1. Money raised through issue of shares

  2. Bank loan

  3. Sale of investments

  4. All of the above

Show answer
Correct Option: D
Explanation:

b'Option D is correct. Capital receipts refer to those receipts which either create a liability or cause a reduction in the assets of the firm. They are non-recurring or non-routine in nature. Sale of investments leads to reduction in assets. Bank loan and money raised through issue of shares create liability for firm. All are capital receipts. '

Interest charged by the bank will be deducted, when the overdraft as per the Cash Book is made the starting point for making the Bank Reconciliation Statement. (True/False)

book keeping and accountancy accounts of 'not for profit' concerns receipts and payments receipts and payments account prepration of income and expenditure account prepration of income and expenditure account and balance sheet

  1. True

  2. False

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Correct Option: B