1. Depreciation appearing in the Trial Balance should be --Debited to
P&L A/c
2. Insurance prepaid is shown as -----------------Current Asset
3. Outstanding salaries is shown as -------------A Liability & By
adjusting it in the P & L A/c
4. At the time of preparation of financial accounts, bad debt
recovered account will be transferred to ----------Profit & loss A/c
5. If actual bad debts are more than the provision for bad debts, then
there will be a------Debit balance of Provision for Bad Debts
Account
6. Provision for bad debts is created to adjust the loss of future bad
debts. This account is created by a debit to the Profit & Loss
Account i.e., a charge against profits. This account shows a credit
balance and appears on the liabilities side of the Balance Sheet.
Actual bad debts for a particular period may exceed the provision
provided or may be less than the provision made.
7. Under casting or overcastting of subsidiary book is an example of
------error of commission
8. If a company has contingent liabilities, they appear in the ---------
Notes on account to Balance Sheet
9. Payments received in advance from a customer for a contract can
be ----Shown as a deduction from contract work-in-progress on
asset side (Or)Shown as a Liability side
10. Tax deducted at source A/c appears in & Investment in own share
A/c appears in –Asset Side
11. Inventory System -------is also known as Appraisal system of
depreciation
12. external cause of depreciation ----------Obsolescence( Kanumarugu
avvatam)
13. Depreciation is calculated on the ----Cost + Transport+
Installation Exp
14. Depreciation is a charge against profit (Correct)
15. The main object of providing depreciation is---------To Calculate Net
Profit
16. Depreciation arises because of----------Wear & Tear
17. Depreciation is a process of--------Valuation
18. Total amount of depreciation of an asset cannot exceed its----------
Depreciation Value
19. When depreciation is calculated under equal portion of the asset's
cost as depreciation expenses in each period of the asset's useful
life is called original cost method or straight line method
20. The two methods of preparing ledger accounts are (1). Periodic
balance method and (2). Self balancing or running balance
method.
21. No entry is made for the trade discount. Merchandise are priced
net of trade discount so it is not recorded in books.
22. Dividend paid by the company to the shareholder at any time
between two annual general meetings are known as interim
dividend.
23. Investment companies which primarily deal in stocks and
securities distribute shares and debenture of other companies by
way of dividend, instead of paying the same in cash, such dividend
is called scrip dividend.
