CA Foundation Principles of Accounting: Questions 29 - 34 of 502

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Question number: 29

» Theoretical Framework » Accounting Policies

Short Answer Question▾

Write in Short

In what cases can a firm bring about a change in its accounting policy?

Question number: 30

» Theoretical Framework » Accounting Policies

Essay Question▾

Describe in Detail

What are the disclosure requirements in case of change in the accounting policy?

Explanation

  • Any changes brought about in the accounting policy have to be disclosed as per the AS 1 issued by the ICAI. The disclosure requirements are as follows:

  • A change in the accounting policy having material effect in the current or later period should be disclosed

  • The amount by which any

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Question number: 31

» Theoretical Framework » Accounting Concepts, Principles and Conventions

Short Answer Question▾

Write in Short

Explain the business entity concept with an example.

Question number: 32

» Accounting Process » Books of Accounts - Preparation of Trial Balance

Essay Question▾

Describe in Detail

The following details were extracted from the books of Mr. Makes on March 31st 2015. Prepare a trial balance as on that date keeping in mind the classification of accounts and the rules involving them.

Table shows the Details of Mr. Makes

Details were extracted from the books of Mr. Makes on March 31st 2015

Particulars

Amount

Particulars

Amount

Salaries

726400

Return inwards

20000

Sales

3470000

Return outwards

8000

Plant and machinery

686000

Discount allowed

23000

Commission paid

37600

Rent

64400

Purchases

2893400

Sundry creditors

285200

Opening stock

222000

Carriage inward

4800

Repairs

33400

Travelling expenses

52600

Sundry expenses

9200

Drawings

70000

Sundry debtors

28600

Investments

120000

Cash

21800

Capital

1250000

Explanation

  • The rules of accounting based on the classification is as follows

  • Personal Account: Debit the receiver’s account and credit the giver’s account

  • Real Account: Debit what comes in and credit what goes out

  • Nominal account: Debit all expenses and losses and credit all incomes and gains.

Based on these rules,

… (199 more words) …

Question number: 33

» Theoretical Framework » Accounting Concepts, Principles and Conventions

Short Answer Question▾

Write in Short

What conditions are to be satisfied by an accounting principle?

Question number: 34

» Accounting Process » Books of Accounts - Capital and Revenue Receipts

Short Answer Question▾

Write in Short

Just classify the following into capital or revenue expenditures or as capital or revenue receipts as the case may be:

  1. Term loan from bank

  2. Dividend received from investments

  3. Expense incurred in R&D with no fruitful results

  4. Expenditure incurred in conversion of petrol driven car to diesel driven car to reduce the operational expenses

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