Trial Balance and Rectification of Errors — Account STD 11 Commerce — Question

Differentiate between Provision and Reserve on the basis of:

1. Appropriation or Charge.
2. Financial Position.
3. Distribution.

Explain Capital Reserve and give its any two examples.

The following information relate to the business of Mohit Raina, who requests you to prepare his amended Cash Book and reconcile his Cash Book balance with his Pass Book balance:

	₹
Balance as per Cash Book (Cr.)	40,000
Unpresented cheques	72,000
Uncredited cheques	13,000

You have been given the following additional information:

1. The debit side of the Cash Book (Bank Column) has been undercast by ₹ 25,000.
2. A cheque for ₹ 10,000 paid to a creditor has been wrongly entered in the Cash Column.
3. Bank commission and other charges ₹ 4,000 have not been recorded in the Cash Book.

Distinguish between Trade Discount and Cash Discount.

How will be the following errors rectified?

1. Sales Book is short casted by ₹ 5,000.
2. Sales Return Book is short casted by ₹ 500.
3. Balance of Sales Book is carried forward short by ₹ 1,000.
4. Balance of Sales Return Book is carried forward short by ₹ 100.

What is CGST? Give an example.

Distinguish between Provision and Reserve on the following basis:

1. Basic Nature.
2. Purpose.
3. Effect on Taxable Profits.
4. Presentation in Balance Sheet.
5. Element of Compulsion.
6. Use for payment of dividend.

What will be the effect of the following on the Accounting Equation?

1. Harish started business with cash ₹ 18,000
2. Purchased goods for Cash ₹ 5,000 and on credit ₹ 2,000
3. Sold goods for cash ₹ 4,000 (costing ₹ 2,400)
4. Rent paid ₹ 1,000 and rent outstanding ₹ 200

Give four differences between a Bill of Exchange and a Promissory Note.

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.