Theory Base of Accounting Account - Theory Base of Accounting

Assets (except Securities) may be valued under Ind-AS on.

Goods taken by the proprietor for personal use is:

Fixed assets and current assets are categorized as per concept of ____________.

Going concern concept is important for _________.

Sale is recognised as revenue:

Materiality principle is an exception to the ‘Full Disclosure Convention'.

All items or facts whether material or immaterial are recorded in accounting.

If a firmi adopts different accounting principles in two accounting periods it conflicts with the concept of consistency.

The essence of convention of prudence is to anticipate no profit and provide for all possible losses.

Revenues are matched with expenses in accordance with going concern assumption.

The management of a firm is remarkably incompetent, but the firm's accountant cannot take this into account while preparing books of accounts because of ................ concept.

Complete the following work sheet:
A firm may hold stock which is heavily in demand. Consequently, the market value of this stock may be increased. Normal accounting procedure is to ignore this because of the ___________.

Complete the following work sheet:
If a firm receives an order for goods, it would not be included in the sales figure owing to the ___________.

If a firm believes that some of its debtors may 'default'. It should act on this by making sure that all possible losses are recorded in the books. This is an example of the ............... convention.

Personal transactions are distinguished from business transactions in accordance with the concept of ......... .

Assertion (A) – GST is destination base tax.
Reason (R) – GST is applicable on all level of sale of goods & services.

Assertion (A) – GST has a dual Aspect.
Reason (R) – In GST Central and state government simultaneously levy on a common tax base

Assertion (A) – Professional person ignore outstanding income but consider outstanding expenses.
Reason (R) – Professional persons follow Cash base system of Accounting.

Assertion (A) – Income are recorded when they are earned or accrued, irrespective of the fact whether cash is received or not.
Reason (R) – Accounting Standard is not permitted to Record of Such income.

Assertion (A) - outstanding expenses must be added to particular expenses to know exact position.
Reason (R) – All cost which is applicable to revenue of the period should be charged against the revenue.

Under which accounting principle, quality of manpower is not recorded in the books if account?

Give two examples of Expense Account.

When is Capital Account debited?

What is Accrual basis of accounting?

Give two examples of Liability Account.

What are the objectives of IFRS? (Any two)

Why fixed assets are not shown in the books at market value?

Why should a business follow the consistency principle?

Why sit necessary for accountants to assume that a business entity will remain a going concen?

Land and Buildings are shown at ₹ 10 Lac in the Balance Sheet of the business owned by Mr. Yuvraj. However, as per the certificate of Govt. approved valuer the realisable value of Land and Building is ₹ 200 Lac. Mr. Yuvraj wants to show the Land and Building at this value in his books. Can he do so?

When should revenue be recognised? Are there exceptions to the general rule?

Discuss the Accounting Convention based on the premise 'Do not anticipate profits but provide for all losses.'

Why is it important to adopt a consistent basis for the preparation of financial statements? Explain.

Vijay, a consultant, during the financial year 2018-19 earned ₹ 4,00,000. Out of which he received ₹ 3,50,000. He incurred an expense of ₹ 1,70,000, out of which ₹ 40,000 are outstanding. He also received consultancy fee relating to previous year ₹ 45,000 and also paid ₹ 20,000 expenses of last year. You are required to determine his income for the year if,

1. He follows Cash Basis of Accounting.
2. He follows Accrual Basis of Accounting.

Explain the following briefly with appropriate example:
Money Measurement Concept.

During the financial year 2018-19, Mohan had cash sales of ₹ 90,000 and credit sales of ₹ 60,000. His expenses for the year were ₹ 70,000 out of which ₹ 30,000 is still to be paid. find out the net income according to Accrual Basis of Accounting.

Explain the meaning of any three of the following terms:
Consistency.

Explain the meaning of any three of the following terms:
Materiality.

What is matching concept? Why should a business concern follow this concept? Discuss.

Explain the meaning of any three of the following terms:
Conservatism.

There are three main components under GST which are IGST, CGST and SGST. Tax collected under CGST and IGST will constitute revenue of central government while collection of SGST is revenue for state govt. all tax like. VAT, entertainment tax, luxury tax and all other which have indirect nature will be merged with GST.
1. Nature of GST is
(A) Direct Tax
(B) Indirect Tax
(C) Merged Tax
(D) None of the above
2. Source of income for State Govt. under GST
(A) IGST
(B) CGST
(C) SGST
(D) All of the above
3. Source of income for Central Govt. under GST
(A) IGST
(B) CGST
(C) SGST
(D) Both (A) & (B)
4. Narrate IGST _________.
(A) Integrated Good & Sale Tax
(B) Inter Good & Services Tax
(C) Integrated Good & Services Tax
(D) Interrelated Good & Services Tax

Mr. A of Baroda purchased goods of Rs. 50,000 from Mr. B of Surat and Rs. 1,20,000 From Mr. X of Jaipur. Mr.A sold goods costing of 1,30,000 to a businessman in Gujarat for Rs. 1,50,000. Rate of IGST is 10%, Rate of SGST is 5% and Rate of CGST is 5%.
1. Amount of IGST charged by Mr. A.
(A) 12000
(B) 17000
(C) Nil
(D) 13000
2. Amount of IGST charged by Mr. X.
(A) 22000
(B) 17000
(C) 3000
(D) 12000
3. Amount of SGST charged by Mr. A.
(A) 15000
(B) 9000
(C) 7500
(D) 6500
4. Amount of CGST charged by Mr. A.
(A) 7500
(B) 6500
(C) 15000
(D) 13000