Bill of Exchange — Account STD 11 Commerce — Question

Interest Account is credited in the books of drawee at the time of renewal of a bill. Do you agree?

How is Trade Discount recorded in the books of account?

In which Column (Plus or Minus) you will write the following while preparing Bank Reconciliation Statement from the Cash Book overdraft balance.

1. Cheques deposited but dishonoured.
2. The receipt side of Cash book overcast.
3. Interest on overdraft.
4. Direct amount deposited by the customer into bank.

Briefly explain the Petty Cash Book.

Differentiate between reserve and provision on the basis of charge or appropriation.

To record a purchase of an asset, why Asset Account is debited?

On 25th March, 2017, a fire broke out in the premises of Kamal Ltd. And destroyed a part of its plant and machinery. On account of this, a sharp decline in production for the next six months is expected. The company did not disclose this fact in its annual report for the year ended 31st March, 2017. What is your opinion about this omission?

Rent is paid for the month of April, 2019 in March, 2019. The accounting year ended on 31st March, 2019. The accountant has shown it on the assets side of the Balance Sheet. Has he given the correct treatment? Give reasons.

Bieflly state the rules of debiting and crediting accounts classified on the basis of Accounting Equation.

A firm earns a revenue of ₹ 21,000 and the expenses to earn this revenue are ₹ 15,000. Calculate its income.