Accounting Process [CA (Chartered Accountant) Foundation Principles of Accounting]: Questions 22 - 25 of 67

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Question 22

Question MCQ▾

Which of these statement (s) are correct about contingent assets?

Choices

Choice (4)Response

a.

The term contingent is used when the outcome of a condition is uncertain

b.

A legal case of compensation whose judgment will be declared after the balance sheet date is an example

c.

When the term contingent is used as a prefix to asset it means the asset is a possible asset to the enterprise

d.

All a., b. and c. are correct

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Question 23

Question MCQ▾

Which of these are the limitations of trial balance?

Choices

Choice (4)Response

a.

Error of omission

b.

Compensating errors

c.

Error of commission

d.

All a., b. and c. are correct

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Question 24

Question MCQ▾

What specific entries are typically recorded in a journal proper?

Choices

Choice (4)Response

a.

Rectification entries

AND

Opening entries

b.

Transfer entries

c.

Closing entries

d.

All a., b. and c. are correct

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Question 25

Question MCQ▾

When the errors are located in the next accounting year, what are the steps taken for their rectification?

Choices

Choice (4)Response

a.

In case of double sided effect, there is no change in the treatment of rectifying the error

b.

Profit and loss appropriation account substitutes the nominal accounts in the rectification entry

c.

Errors relating to real and personal accounts will pass through the relevant account to know the exact position of such accounts

d.

All a., b. and c. are correct

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