The concept which states that revenue is recognized when goods are sold is
Realization concept
Going concern concept
Matching concept
Periodically concept
Correct answer is A
The realization concept states that revenue can only be recognized once the available goods or services associated with the revenue have been delivered or sold.
The consistency concept aims at
Ensuring that all expenses are matched against revenue
Reducing cost
Comparability of accounting records
Suppressing profits to be declared
Correct answer is C
The concept of consistency means that accounting methods once adopted must be applied consistently in the future, and same methods and techniques must be used for similar situations
Going concern concept
Accrual concept
Business entity concept
Periodicity concept
Correct answer is A
The going concern concept is an accounting term that states that a business entity will continue running its operations in the foreseeable future and will not be liquidated or forced to discontinue operations for any reason.
Which of the following activities will increase profits?
Depreciation charges
Reduction in provision for doubtful debts
Undervalued closing stock
Returns inwards
Correct answer is B
The provision for doubtful debts is the estimated amount of bad debt that will arise from accounts receivable (credit sales) that have been issued but not yet collected.
If a business estimated 20,000 as bad debts, a reduction to a lesser amount means the business will make more money from sales, which amounts to higher profits.
Sales and purchases ledger are used in a business to keep records of?
The owner's capital and cash transactions
Accounts of individual customers and suppliers
Current assets and fixed assets
Current liabilities and long term liabilities
Correct answer is B
No explanation has been provided for this answer.