Outstanding expenses and Provision for any expense will
come under liability side...?
Though it is basic question, it is to ensure the answer.
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Answer / sudhansu dash
Outstanding expenses is a libility for the company which
has to pay in future date similary provision is also a
libility which company will make face the future expenses.
Outstanding expenses like, Telephone bill or elec. bill.
ect.
Provision for expenses like, we have a dispute regarding
telephone bill or salary payment etc. most of the time
these amount are payable amounts.
Both are the same in nature therefore we have to consider
this as Libility to the company or libility side of the
Balance Sheet.
| Is This Answer Correct ? | 43 Yes | 3 No |
Answer / anjan kumar
Both outstanding expenses and provision for any expense
will be treated as liability for the future period, hence
it will be treated as liability and shown in the liability
side under the heading current liabilities and provisions
of the balance sheet of the company.
| Is This Answer Correct ? | 20 Yes | 4 No |
From the following Trial Balance of Seema Garments as on 31st Dec., 2007, prepare Trading Profit and Loss Account and Balance Sheet: Dr. Rs. Cr. Rs. Opening Stock 15000 Purchases and Sales 109000 180000 Manufacturing Wages 8000 Fuel, Power and Lighting 12000 Salaries 11000 Income Tax 5500 Loan to Mr. X at 10% pa. 5000 Interest on Mr. X’s Loan 300 Apprentice Premium 4500 Rent 4000 Rent Owing 600 Furniture (includes furniture of Rs.1000 purchased on 1st July, 2007) 5000 B/R and B/P 6000 1600 Plant 72000 Debtors and Creditors 28000 13000 Capital 100000 Cash 19500 300000 300000 Informations: 1. Closing Stock was valued at Rs. 30,000. 2. Goodsworth Rs. 5000 was sold on 28th December, but no entry was passed to this effect. 3. Goods costing Rs. 7000 was purchased and included into Stock but no entry was passed to record the purchases. 4. Create a provision of 2% for discount on debtors. 5. Apprentice premium received on 1st January, 2007 was for 3 years. 6. Depreciate the furniture by 10% p.a. 7. Salaries for the month of December, 2007 are still outstanding.
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