For a student of accounting, an in-depth understanding of the topics is of prime importance and only with queries that are presented here can a student get a detailed understanding of the whole topic.
Objective type questions:
- What is the balance of petty cash considered?
- How is the closing of stock valued at?
- Which side will the stock appearing in Trial Balance be shown?
- Where will the stock appearing outside of Trial Balance be shown at?
- What balance do liabilities have?
- How is net loss termed in a business?
- How is net profit taken in case of a firm?
- Amongst the following:Liability for discounted bills/ Short term loans/ Outstanding wages/ Bank overdraft which is considered a contingent liability?
Apart from certain objective queries, for conceptual clarity, it is important to have detailed knowledge, and here is a set of statements for that.
State True or False:
- Is unearned income liability of any business?
- Is unearned income equal to income received in advance?
- Is the outstanding income account the real account?
- Can net loss be termed as the firm’s asset since a business venture has to realize this loss from proprietors?
- Are the goods that are sent to customers for ‘sale or return’ basis also be termed as sales?
- Can prepaid expenses be considered assets for a business venture?
- Can accrued income and income due but not received different from each other?
- Can outstanding expenses account be considered as personal account?
- Does liabilities side of a balance sheet be said to represent credit balance?
- Is the credit and debit side of a profit and loss account always said to be equal?
Answers: 1. True 2. True 3.False 4.True 5.False 6.True 7.False 8.True 9.True 10. False
Long Answer Questions:
- Why is it necessary to keep the issue of bad debts into consideration always? How I this placed in the Final Accounts?
- How is adjusting entries important? Why adjusting entries are needed in preparation of Final Accounts?
- How is accidental loss of goods treated in Final Accounts in case: Goods had not been insured/ Goods have been insured and the Insurance company has claims associated with it.
Very short Questions:
- When stock is available on both inner and outer side of Trial Balance how is the two versions treated?
- If unearned income appears in Trial Balance then where is it to be showed in financial statements?
- From which account and which side is net loss taken for calculation?
- To get the details of bad debts which journal entry would you consider?
- How does net profit and net loss affect the business?
- What is wages owing in Final Accounts is found in Trial Balance how would you treat them?
- For getting prepaid rent which adjusting entry would be passed?
- What is that situation when purchases account can be credited?
- What are the items to be added and subtracted from capital on the liabilities side of the account?
- Name any 4 fixed and 3 current assets
Write short notes on:
- Discount given to creditors
- Expenses that are owing
- Income that is not earned
- Insurance that has not expired
- Increase in assets value
- Interest placed on drawings
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