Question
Give one difference between General Reserve and Specific Reserve.
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Answer
- General Reserve: is the amount set aside out of profits not for any specific purpose. It is available for any future contingency or expansion of business. Such reserve strengthens the financial position of the business. Example is General Reserve.
- Specific Reserve: is that reserve which is set aside out of profits for a specific purpose and can be utilised only for that purpose. For example, Workmen Compensation Reserve is a specific reserve because it is maintained to to workmen. Debentures Redemption Reserve, Capital Redemption Reserve, Investment Fluctuation Reserve, etc., are other examples of Specific Reserve.
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2017
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May 2
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Purchased from Fashion House, Mumbai (Maharashtra)
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| 100 Shirts @ ₹ 1,800 per Shirt | |||
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Less: 20% Trade Discount and freight charges payable ₹ 2,000. | ||
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