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DK Goel Solutions Class 11 Chapter 22

DK Goel Solutions for Class 11 Accountancy Chapter 22 Financial Statements With Adjustments as per latest DK Goel Book available for free<br><br>https://dkgoelsolutions.com/class-11/chapter-22-financial-statements-with-adjustments/

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DK Goel Solutions Class 11 Chapter 22

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  1. DK Goel Solutions Class 11 Chapter 22 DK Goel Accountancy Class 11 Solutions Chapter 22, which is laid out by master Accountancy instructors from the most recent form of DK Goel Class 11 Accountancy books. We, at Dk Goel Solutions help students to fathom every one of the hypotheses, specifically. There are various ideas in Accountancy, however the ideas of Trial Balance, Depreciation and Bank Reconciliation Statement (BRS) are required. DK Goel Solutions Class 11 – Chapter 22 Short Answer Questions for DK Goel Solutions Class 11 Chapter 22: Question 1: What is the necessity of doing adjustments? Give four adjustment entries with their explanations. Solution 1: Necessity to make modifications: 1. 2. To assess the company’s real financial status. 3. To document a transaction that has been removed from the accounts. Entries for adjustment:- To determine the company’s actual net profit or loss.

  2. 4. Wages A/c To Outstanding wages A/c (wages due) Dr. 5. Salary A/c To outstanding Salary A/c (salary due) Dr. 6. Prepaid Insurance A/c To Insurance A/c (Insurance prepaid in advance) Dr. 7. Depreciation A/c To Machinery A/c To Furniture A/c (Depreciation charge) Dr. Question 2: Why is provision for doubtful debts created? How is it shown in the balance sheet? Solution 2: Instead of reserve, the term provision should be used when the purpose is not to improve the business’s financial position, but to compensate an anticipated potential loss. In balance sheet: Liabilities Amount Assets Amount Debtors 50,000 Less: Provision for bad and doubtful debts 2,000 48,000 Question 3: What is meant by outstanding expenses? Give its adjusting entry. Solution 3:

  3. This are the costs that were accumulated during the year but were left outstanding on the day of final account planning. Name of Accounts Dr. Balances Cr. Balances Wages paid 2,20,000 Salary paid 55,000 Question 4: Write notes on the following:- I. Accrued income II. Unearned income III. Provision for doubtful debts Solution 4: i. Accrued Income: It is quite common that certain items of income such as interest on securities, commission, rent etc., are earned during the current year but have not been actually received by the end of the current year. Such incomes are known as accrued income. ii. Unearned Income: Certain income is received in the current year but the whole amount of it does not belong to the current year. Such portion of this income which belongs to the next year is known as unearned income. iii. Provision for doubtful debts: such a provision is created at a fixed percentage on debtors every year and is called ‘provision for bad and doubtful debts’. Question 5: Explain the followings with examples:- i. Capital expenditure ii.Revenue expenditure iii.Deferred revenue expenditure

  4. Solution 5: 1) Capital Expenditure: If benefit of expenditure is received for more than one year, it is called capital expenditure. Example: Purchase of Machinery. 2) Revenue Expenditure: It is the amount spent to purchase goods and services that are used during an accounting period is called revenue expenditure. For Example: Rent, interest, etc. 3) Deferred Revenue Expenditure: There are certain expenditures which are revenue in nature but benefit of which is derived over number of years. For Example: Huge Advertisement Expenditure. Question 6: Give any two examples of Capital expenditure. Solution 6: i. Purchase of machinery. ii.Expenditure on installation of machinery. Question 7: Distinguish between capital expenditure and revenue expenditure. Solution 7: 1) Capital Expenditure: If benefit of expenditure is received for more than one year, it is called capital expenditure. Example: Purchase of Machinery. 2) Revenue Expenditure: It is the amount spent to purchase goods and services that are used during an accounting period is called revenue expenditure. For Example: Rent, interest, etc. Question 8: Show the treatment of the following in Final Accounts when given inside the Trial Balance. a) Prepaid expenses b) Depreciation

  5. c) Closing stock d) Interest on capital e) Commission received in advance Solution 8: a) Assets b) Dr. of P & L A/c c) Assets d) Dr. of P & L A/c e) Liabilities. Question 9: Give the adjustment entry and the treatment in Final Accounts of the following: i. Accrued Income ii.Unearned Income Solution 9: Adjustment Entry Treatment in P & L A/c Treatment in Balance Sheet i. Accrued income Accrued income A/c Dr. To Income A/c Added in income on credit side of Profit & Loss A/c Shown on the Assets side. ii. Unearned income Income A/c Dr. To Unearned income A/c Deducted from income on the credit side of Profit and Loss A/c Shown on the liabilities side.

  6. Also read - Dk Goel Solutions Class 12 Download Free study materials for your Examinations at DK goel Solutions

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