Class test 1

According to money measurement concept, the following will be recorded in the books of account of the business:

• Health of Managing Director of the company

• Quality of company’s goods

• Value of plant and machinery

• Manager's schedule

The convention of conservatism is applicable:

• In providing for discount on creditors

• In making provision for bad and doubtful debts

• Providing for depreciation

The amount brought in by the proprietor in the business should be credited to:

• Cash account

• Capital account

• Drawing account

State whether each of the following statements is “True” or “False”.

 

Since the life of the business is assumed to be indefinite, the financial statements of the business should be prepared only when it goes into liquidation?

State whether each of the following statements is “True” or “False”.

A ‘Revenue’ denotes the value in terms of money which the business owes?

State whether each of the following statements is “True” or “False”.

The following entries have been passed by a student. You have to state whether these entries are correctly passed. If not so, pass the correct journal entries.

a.Cash account  Rs. 7000

            To Interest account           Rs. 7000

(Being interest paid)

 State whether each of the following statements is “True” or “False”.

 

The “Posting” is done in the Journal.

1.       On June 3, 2024, Apman and Tenru started Crescendo Limited, a concert-booking service as equal shareholders with a total share capital of Rs. 100,000. Each of them contributed Rs. 40,000 and agreed to contribute the balance when called. On August 12, 2024, the company had Rs. 150,000 in cash and Rs. 180,000 in unpaid bills. On that date, Apman had personal cash of Rs. 90,000 and owed Rs. 50,000 on a personal bank loan. Tenru had personal cash of Rs. 30,000 and owed Rs. 22,000 on a personal bank loan. i. How much are Apman and Tenru required to pay?