Accounting for Bills Exchange — Account STD 11 Commerce — Question

“Cash Book always shows a debit balance.” How far is this statement true and why?

What is Net Profit?

If debit side of Profit and Loss Account is bigger than the credit side, does it mean net profit or net loss? Why?

What is meant by Written Down Value Method of providing Depreciation?

Which Generally Accepted Accounting Principle (GAAP) is followed and which one is ignored while preparing the accounts under Single Entry System?

Cancelling an old bill and drawing a new bill is called Renewal of a Bill. Is this true or false?

Give one special feature of promissory note.

Give the adjustment entry and the treatment in Final Accounts of the following:

1. Accrued Income.
2. Unearned Income.

Classify the following as capital expenditure, revenue expenditure and deferred revenue expenditure for a cloth merchant:

1. Preliminary Expenses.
2. Purchase of Furniture.
3. Payment of Salary.
4. Expenses paid for Construction of Building.

“Liabilities side of the Balance Sheet always represents Credit balances.” Do you agree?