Prepaid expenses are valued on the Balance Sheet at

A. Replacement cost
B. Current cost
C. Cost to acquire less accumulated amortization
D. Cost less expired portion

Goods in stock worth 800 are destroyed by fire and the Insurance Co. is accepted the claim for 600. Adjustment would involve

A. Debit of 800 to trading account and credit of 600 and 200 to insurance company and
B. Deduct the 800 from closing stock in the trading account
C. Credit insurance company for 600
D. Debit of 600 and 200 to insurance company and profit and loss account respectively and credit of 800 to trading account

Sundry debtors as per Trial Balance is 43,000 which includes 2,200 due from ‗H in respect of goods sent to him on approval basis, the cost price of which is 1,800. Rectification would involve:

A. Adding 2,200 to closing stock
B. Deducting 1,800 from closing stock and deducting 2,200 each from debtors and sales
C. Adding 1,800 to closing stock and deducting 2,200 each from debtors and sales
D. Deducting 1,800 from debtors

Which of the following entries is correct in respect of reserve for discounts on accounts payable?

A. Debit p&l a/c and credit reserve for discount on accounts payable a/c
B. Debit accounts payable a/c and credit p&l a/c
C. Debit reserve for discount on accounts payable a/c and credit p&l a/c
D. Debit reserve for discount on accounts payable a/c and credit accounts payable a/c

On scrutiny of a firm‘s books of accounts, it was observed that the following errors have occurred in the previous years but have not yet been rectified.

A. I. depreciation for 2011-2012- 7,000 understated
B. Ii. accrued expenses as at march 31, 2013 – 10,000 understated
C. The impact of this on the reported net income for the year ending march 31, 2013 is
D.

The adjustment to be made for prepaid expenses is____________?

A. Add prepaid expenses to respective expenses and show it as an asset
B. Deduct prepaid expenses from respective expenses and show it as an asset
C. Add prepaid expenses to respective expenses and show it as a liability
D. Deduct prepaid expenses from respective expenses and show it as a liability

Bad debts recovered is:

A. Credited to p&l a/c
B. Debited to p&l a/c
C. Reduced from debtors in balance sheet
D. Added to debtors in balance sheet

A club paid subscription fees of `1,400. Out of which ` 200 is prepaid. In such case

A. P&l a/c is debited with 1,400
B. P&l a/c is debited with 1,200
C. 200 is shown as current asset
D. Both b. and c. above

Depreciation appearing in the Trial Balance should be?

A. Debited to p&l a/c
B. Shown as liability in balance sheet
C. Reduced from related asset in balance sheet
D. Both a. and c. above

Insurance prepaid is shown as:___________?

A. Current asset
B. Current liability
C. Fixed asset
D. Income