FS of Sole Proprietorship Test

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FS of Sole Proprietorship Test - 1

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Weekly Quiz Competition

Question 1
1 / -0

The expenditure whose amount is heavy and benefit of the likely to be derived over a number of years called ____________.

A
Both

B
Deferred revenue expenditure

C
Deferred capital expenditure

D
None

Solution

Explanation:

deferred revenue expenditure is the expenditure which is done once and benefits of it can be derived for a number of years example - advertisement expenditure.
Question 2
1 / -0

Accrued income is

A
Expense

B
Asset

C
Liability

D
Revenue

Solution

Explanation:

accrued income is considered as current asset as it is the income due but not received.
Question 3
1 / -0

Types of account shown in the balance sheet are

A
None of these

B
Nominal and real

C
Nominal and personal

D
Real and Personal

Solution

Explanation:

since nominal account is of incomes gains losses and expenses they are shown in trading and profit and loss account so real and personal accounts are shown in balance sheet as it includes assets and liabilities.
Question 4
1 / -0

Which of the following will not be included in Trading account

A
Manufacturing Wages

B
Postage and telegram expense

C
Carriage on purchase

D
Factory expenses

Solution

Explanation:

postage and telegram are indirect expenses. They are not shown in trading account they are shown in debit side of profit and loss account
Question 5
1 / -0

All direct expenses are ___ to Trading account and all indirect expenses are __________ to Profit and Loss account.

A
Credited , Credited

B
Credited , Debited

C
Debited, Credited

D
Debited, Debited

Solution

Explanation:

trading and profit and loss account is nominal in nature so all the expenses are debited. the direct expenses are debited in trading account and the indirect expenses are debited to profit and loss account.
Question 6
1 / -0

Capital receipt includes following receipts :

A
Fresh capital introduced or additional capital introduced

B
Loan raised

C
Amount received which is not is the normal and ordinary course of business like sale of fixed assets.

D
All of these

Solution

Explanation:

capital receipts are those which reduces the fixed assets and increases the long term liability. increasing capial and raising loan increase the liablity so they are capital receipt. similarly sale of nassets leads to decrease in assets so it is also capital receipts so all the option are correct.
Question 7
1 / -0

The amount which is incurred to aquire or improve the fixed assets is known as _______________.

A
Capital receipt

B
Revenue Expenditure

C
Capital expenditure

D
Revenue receipt

Solution

Explanation:

the expenditure done to increase the assets is known as capital expenditure.
Question 8
1 / -0

Revenue Expenditure means

A
None

B
The expenditure which is incurred for the day to day running of the business

C
The amount which is incurred in acquiring or improving the value of fixed assets

D
Both

Solution

Explanation:

revenue expenditure are the expenses incurred to match the revenue. these are the expenses which are done to run the day to day business.
Question 9
1 / -0

Which is not an example of Capital expenditure

A
Initial expenditure for acquiring patent right.

B
Depreciation on fixed assets

C
Preliminary expenses for floating a company.

D
Expenses for obtaining a license.

Solution

Explanation:

Depreciation is revenue expenditure. these are charged directly to depreciation account
Question 10
1 / -0

The item discount received will appear on the

A
Debit side of Profit and loss account

B
Credit side of Profit and loss account

C
Debit side of Balance sheet

D
Credit side of Balance sheet

Solution

Explanation:

since discount received is profit for the business so it is credited in profit and loss account.

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Re-Attempt Weekly Quiz Competition

FS of Sole Proprietorship Test - 1

Result

FS of Sole Proprietorship Test - 1

Score

-

Rank

-

SHARING IS CARING

Question 1

Both

Deferred revenue expenditure

Deferred capital expenditure

None

Solution

Question 2

Expense

Asset

Liability

Revenue

Solution

Question 3

None of these

Nominal and real

Nominal and personal

Real and Personal

Solution

Question 4

Manufacturing Wages

Postage and telegram expense

Carriage on purchase

Factory expenses

Solution

Question 5

Credited , Credited

Credited , Debited

Debited, Credited

Debited, Debited

Solution

Question 6

Fresh capital introduced or additional capital introduced

Loan raised

Amount received which is not is the normal and ordinary course of business like sale of fixed assets.

All of these

Solution

Question 7

Capital receipt

Revenue Expenditure

Capital expenditure

Revenue receipt

Solution

Question 8

None

The expenditure which is incurred for the day to day running of the business

The amount which is incurred in acquiring or improving the value of fixed assets

Both

Solution

Question 9

Initial expenditure for acquiring patent right.

Depreciation on fixed assets

Preliminary expenses for floating a company.

Expenses for obtaining a license.

Solution

Question 10

Debit side of Profit and loss account

Credit side of Profit and loss account

Debit side of Balance sheet

Credit side of Balance sheet

Solution

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