Expenses which are paid before due date are called as _____. - Book Keeping and Accountancy

Question

Expenses which are paid before due date are called as _____.

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Solution

Expenses which are paid before due date are called as Prepaid Expenses.

Explanation:

Prepaid Expenses are those costs that have been paid in advance but the benefit of which will be received in the future. Since the payment is made before the actual due date or before the expense is incurred, it is treated as a Current Asset in the Balance Sheet until it expires.

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Partnership Final Accounts

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Q I. E. 16)Q I. E. 15)Q I. E. 17)

Chapter 1: Introduction to Partnership and Partnership Final Accounts - Exercise 1.1 (Objective Questions) [Page 52]

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Balbharati Book-Keeping and Accountancy [English] Standard 12 Maharashtra State Board

Chapter 1 Introduction to Partnership and Partnership Final Accounts
Exercise 1.1 (Objective Questions) | Q I. E. 16) | Page 52

2025-2026 (March) Board Question Paper (with solutions)

Q 1. (D) (5) | 1 mark

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RELATED QUESTIONS

What do you mean by intangible asset?

Write the word/phrase/term, which can substitute the following sentence.

Debit balance of trading account.

Given below is the Trial Balance of M/s Roma and Mona partnership firm. Prepare Trading and Profit and Loss Account for the year ended 31st March, 2012 and Balance Sheet as on that date

Trial Balance as on 31^st March, 2012

Debit Balance	Amount Rs	Credit Balance	Amount Rs
Stock on 1^st April, 2011	52000	Provident fund	50000
Sundry Debtors	84000	Interest on P.F. Investment	2800
Bad debts	3000	Sundry Creditors	84000
Premises	78000	Rent received	9600
Salaries	28000	Reserve for Doubtful Debts	2000
Motor Vehicles	50000	Discount received	3600
Purchases	176000	Sales	320000
Provident Fund Investment	50,000	Capital A/c-
Provident Fund contribution	5500	Roma	50000
Wages	22000	Mona	50000
Rent (for 10 months)	16,000
Office Expenses	5,000
Discount allowed	2,500
	572000		572000

Adjustments:

1) Stock on 31st March, 2012 was valued at Rs 80,000.

2) Goods of Rs 6,000 were sold and despatched on 27th March, 2012, but no entry was made in the books of accounts.

3) Write off Bad debts of Rs 4,000 and provide for R.D.D. at 5% on sundry debtors.

4) Provide reserve for discount on debtors at 2% and on creditors at 3%.

5) Outstanding wages Rs 4,000 and outstanding salaries Rs 3,066.

6) Depreciate Motor Vehicle at 5% p.a.

Given below is the Trial Balance of M/s Seeta and Geeta as on 31^st March, 2010. You are required to prepare Trading and Profit and Loss Account for the year ended 31^st March, 2010 and Balance Sheet on that date.

Trial Balance as on 31^st March, 2010

Debit Balance	Amount (Rs)	Credit Balance	Amount (Rs)
Current A/c-		Capital A/c-
Geeta	4000	Seeta	120000
Opening stock	88,000	Geeta	120000
Purchases	1,76,000	Current A/c- Seeta	5000
Wages	23,500	Sundry Creditors	103000
Salaries	15,000	Bank overdraft	60000
Office Expenses	8000	Sales	308000
Bank Charges	2600
Legal Charges	3000
Machinery	90000
Land and building	130000
Interest	3600
Export Duty	3800
Bad -Debts	4000
Sundry Debtors	82000
Travelling Expenses	3200
Electricity charges	2300
Furniture	37000
8% Debentures (Purchased on 1.10.2009)	40000
	716000		716000

Adjustments:

1) Stock on hand on 31st March, 2010 was valued at Rs 80,000.

2) Goods costing Rs 16,000 destroyed by fire and Insurance Company admitted a claim of Rs 13,000.

3) Provide for outstanding expenses: Salaries Rs 3,000, Wages Rs 2,400.

4) Depreciate Machinery at 10% p.a. Land and Building at 5% p.a.

5) Create Reserve for Bad and doubtful debts at 5% on Sundry Debtors.

6) Legal charges paid in advance Rs 1,200.

7) Provide interest on capital at 8% p.a.

Keshav and Madhav were partners sharing the profits and losses in the ratio of 2:3. Their Balance Sheet is as follows:

Balance Sheet as on 31^st March, 2011

Liabilities	Amount (Rs)	Assets		Amount (Rs)
Capital Accounts :		Live stock		20000
Keshav	250000	Building		138000
Madhav	260000	Investment		45000
Creditors	8500	Loose Tools		38000
		Debtors	90000	72000
		(-)R.D.D	18000	72000
		Profit and Loss A/c		15000
		Closing Stock		104500
		Cash in Hand		86000
	518500			518500

On 1^st April, 2011 they admitted Uddhav on the following terms:

1) The new profit sharing ratio is equal.

2) Uddhav brings Rs 2,00,000 as his capital and Rs 80,000 as share of goodwill in cash.

3) Prepaid insurance of Rs 7,500 was not recorded in the books.

4) Loose tools were found undervalued by 5% and Building was found overvalued by 15% in the books.

5) All debtors are considered as good and out of creditors Rs 500 is no longer payable.

6) The market Value of Investment is 50% more than its book value.

Prepare, Profit and Loss Adjustment in A/c, Capital Accounts of partners and Balance Sheet of the new firm.

Anita, Sunita and Kavita were partners sharing profits and losses in the ratio 3:3:2. Their Balance Sheet as on 31st March 2013 is as below:

Balance Sheet as on 31st March, 2013.
Liabilities	Amount (₹)	Assets	Amount (₹)
Capital Accounts	11,000	Building	10,000
Anita	15,000	Machinery	10,700
Sunita	8,000	Furniture	10,000
Kavita	10,000	Debtors	5,000
Creditors	10,900	Stock	6,600
Reserve fund	4,000	Cash	6,600

On 1st April, 2013, Mrs. Kavita retired from the firm on the following terms:

Goodwill of the firm is to be valued at ₹4,000, however, only Kavita’s share in it is to be raised in the books and written off immediately.
Assets to be revalued as under:
Stock ₹6,300; Machinery ₹10,000; Furniture ₹10,200.
R.D.D. to be maintained at 10% on debtors.
₹100 to be written off from creditors.
The amount payable to Mrs. Kavita is to be transferred to her loan account.

Prepare:

Profit and loss adjustment account.
Partner’s capital account, and
Balance Sheet of new firm as on 01.04.2013.

To find out Net Profit or Net Loss of the business __________ account is prepared.

A ______ is an intangible asset.

Write the word/phrase/term, which can substitute the following sentence.

Expenses which are paid before they are due.

Write the word/phrase/term, which can substitute the following sentence.

The accounts that are prepared at the end of each accounting year.

Write the word/phrase/term, which can substitute the following sentence.

An asset which can be converted into cash easily.

Write the word/phrase/term, which can substitute the following sentence.

The account in which selling expenses of the business are recorded.

State whether the following statement is True or False with reasons.

Balance Sheet is an Account.

State whether the following statement is True or False with reasons.

Income received in advance is a liability.

State whether the following statement is True or False with reasons.

R.D.D. is created on Creditors.

Find odd one.

The withdrawal by partner for personal use from the firm is ________ to his account.

Cash receipts which are recurring in nature are called as__________ Receipts.

Trading Account is prepared on the basis of ______ expenses.

Answer in one sentence only.

As per which principle of accounting, closing stock is valued at cost price or at market price whichever is less?

Current account always shows a debit balance.

Do you agree/disagree with the following statement:

Profit and Loss Account reflects the true Financial position.

Do you agree/disagree with the following statement:

Carriage Inward is a selling and distribution overhead.

Do you agree/disagree with the following statement:

Gross profit is an operation profit.

Calculate 12.5% P.A. depreciation on Furniture:

on ₹ 2,20,000 for 1 year
on ₹ 10,000 for 6 months

Archana and Prerana are partners, sharing Profits and Losses in the ratio 2: 1 with the help of following Trial Balance and Adjustments given below. You are required to prepare Trading and Profit and Loss Account for the year ended 31st March 2019 and Balance Sheet as on that date.

Trial Balance as on 31^s^t March 2019

Debit Balance	Amount ₹	Credit Balance	Amount ₹
Stock (1/4/2018)	8,560	Capital:
Patents	2,000	Archana	40,000
Sundry Debtors	18,500	Prerana	20,000
Stock of Stationary	3,000	Other Loans	3,000
Trade Mark	2,000	Reserve fund	1,000
Bills Receivable	6,300	Sundry Creditors	17,500
Electricity charges	1,450	Bills Payable	5,000
Wages	950	Purchase Return	1,000
Heating & Lighting	1,000	R.D.D	500
Trade Expenses	850	Sales	30,200
Sales Return	400	Interest	310
Land & Building	22,000
Furniture	13,000
Cash at Bank	5,000
Investments	7,500
Drawings :
Archana	1,200
Prerana	900
Bad debts	200
Purchases	23,700
	1,18,510		1,18,510

Adjustments:

1) Stock on 31^st March 2019 is valued at Cost Price ₹ 12,000 and Market Price ₹ 17,000.

2) Our customer Mr. Shekhar failed to pay his dues of ₹ 800.

3) 1/8^th of Patents are to be written off.

4) A part of Furniture ₹ 5,000 is purchased on 1^st Oct 2018.

5) Depreciation on Land & Building 10% and on Furniture 5%.

6) Outstanding Expenses Wages ₹ 300 and Electricity Charges ₹ 200.

7) Allow Interest on Capital 3%.

Nana and Nani are Partners in Partnership Firm sharing Profits and Losses equally. You are required to give effects of Adjustments in Profit & Loss A/c and Balance Sheet with the help of the following information.

Trial Balance as on 31st March 2019

Debit Balance	Amount ₹	Credit Balance	Amount ₹
Insurance	15,000	Capital A/c
Land and building	50,000	Nana	50,000
(Addition of 20,000 w.e.f 1^st July 2018)		Nani	50,000
Salaries	5,000	10% Bank loan taken on 1^st Oct. 2018	30,000
Export Duty	2,500	Interest	1,500
Interest	1,000	Bills Payable	8,000
Furniture	40,000
Debtors	26,000
	1,39,500		1,39,500

Adjustments :

1) Gross profit amounted to ₹ 34,500.

2) Insurance Paid for 15 months w.e.f. 1. 4. 2018.

3) Depreciate Land and Building at 10% p.a. and Furniture at 5% p.a.

4) Write off ₹ 1,000 for Bad Debts and maintain R.D.D at 5% on Sundry Debtors.

5) Closing Stock is valued at ₹ 34,500.

Kshipra and Manisha are Partners sharing Profit and Loss in their Capital Ratio. You are required to prepare Trading Account and Profit and Loss Account for the year ended 31st March 2019 and Balance Sheet as on that date.

Trial Balance as on 31st March 2019
Debit Balance	Amount (₹)	Credit Balance	Amount (₹)
Sundry Debtors	28,000	Sales	1,20,000
Purchases	55,000	Rent	1,800
Furniture	38,500	Sundry Creditors	38,500
Plant & Machinery	60,000	Purchase Return	1,000
Wages	800	Discount	500
Salaries	3,500	Bills Payable	9,000
Discount	800	Capital A/c:
Bills Receivable	14,400	Kshipra	90,000
Carriage Outward	1,000	Manisha	30,000
Postage	500	Current A/c:
Sales Return	500	Kshipra	5,000
Cash in Hand	4,000	Manisha	3,000
Cash at Bank	47,000
Insurance	2,000
Opening Stock	17,800
Trade Expenses	1,500
Warehouse Rent	2,500
Advertisement	1,000
Building	20,000
	2,98,800		2,98,800

Adjustments:

Stock on 31st March 2019 was at ₹37,000.
Sales include the sale of machinery of ₹ 2,000, which is sold on 1st April 2018.
Depreciation on fixed assets @ 5%.
Each Partners is entitled to get Commission at 1% of Gross Profit and Interest on Capital 5% p.a.
Outstanding Expenses Wages ₹ 200 & Salaries ₹ 500.
Create provision for doubtful debts @ 3% on Sundry Debtors.

Find out Gross profit/Gross loss Purchases ₹ 30,000, Sales ₹ 15,000, Carriage Inward ₹ 2,400, Opening Stock ₹ 10,000, Purchase Returns ₹ 1,000, Closing Stock ₹ 36,000.

Borrowed loan from Bank of Maharashtra ₹ 2,00,000 on 1st October 2019 at a rate of 15% p.a. Calculate Interest on Bank Loan for the year 2019-20 assuming that the financial year ends on 31st March, every year.

Kranti & Sumangala are Partners sharing Profits and Losses in their Capital ratio. From the Trial Balance given below and Adjustments, you are required to prepare Trading and Profit and Loss Account for the year ended 31st March, 2019 and Balance Sheet as of that date.

Trial Balance as on 31st March, 2019
Debit Balance	Amount (₹)	Credit Balance	Amount (₹)
Stock (1/4/2018)	32,500	Capital:
Purchases	40,000	Kranti	1,20,000
Sundry Debtors	1,00,000	Sumangala	40,000
Bills Receivable	8,500	Sales	60,000
Wages	3,000	Sundry Creditors	30,000
Investment	32,000	Bills Payable	15,000
Postage	2,700	Commission	325
Insurance	7,500	Purchases Returns	1,000
Plant & Machinery	15,000
Salaries	4,850
Prepaid Rent	2,000
Bad-debts	500
Furniture	12,500
Cash in Hand	3,775
Sales Return	1,500
	2,66,325		2,66,325

Adjustments:

Closing Stock is valued at Cost Price ₹ 28,000 and Market Price ₹ 32,000.
Insurance is paid up to 30th June 2019.
Outstanding Expenses - Wages ₹ 800, Salaries ₹ 700.
Book value of Plant and Machinery is reduced to ₹ 13,000.
Depreciate Furniture by 5% p.a.
Provide further Bad debts of ₹ 800.
Goods of ₹ 3,000 distributed as a free sample.

Find odd one.

Find odd one

Find odd one.

Registration of Partnership is ______ in India.

Asha and Nirasha are partners sharing profits and losses in the ratio of 1 : 1. From the following Trial Balance and additional information, prepare Trading and Profit and Loss account for the year ended 31st March, 2023 and Balance Sheet as on that date.

Trial Balance as on 31st March, 2023
Debit Balance	Amount (₹)	Credit Balance	Amount (₹)
Stock (1/4/2022)	1,30,000	General Reserve	29,000
Bills Receivable	56,000	Capital:
Wages and Salaries	18,000	Asha	3,20,000
Sundry Debtors	2,65,000	Nirasha	2,40,000
Bad Debts	2,000	Creditors	1,96,000
Purchases	2,96,000	R.D.D.	3,600
Motor Car	1,36,000	Sales	5,71,000
Machinery	2,29,600	Outstanding Wages	1,400
Audit Fees	2,400	Purchases Returns	8,000
Sales Return	4,000	Discount	3,600
Discount	4,600
Building	1,50,000
Cash at Bank	24,000
10% Investment	40,000
Advertisement (Paid for 9 months)	9,000
Royalties	6,000
	13,72,600		13,72,60

Adjustment and Additional Information:

(1) Closing Stock ₹ 80,000.

(2) Depreciation Building and Machinery @ 5% and 3% respectively.

(3) Bills Receivable included dishonoured bill of ₹ 6,000.

(4) Goods worth ₹ 2,000 taken by Asha for personal use was not entered in the books of accounts.

(5) Write off ₹ 3,600 as Bad debts and maintain R.D.D. at 5% on Sundry Debtors.

(6) Goods of ₹ 12,000 were sold but no entry was made in the books of accounts.

Undervaluation of closing stock by 10%, closing stock was of ₹ 54,000. Find out the value of closing stock.

From the following Trial Balance and Adjustments of Rushabh and Yesha, you are required to prepare final accounts as on 31st March, 2023. Profit and Loss sharing ratio of partners is their capital ratio.

Trial Balance as on 31st March, 2023
Particulars (Name of Accounts)	Debit (₹)	Credit (₹)
Capital and Drawings :
Rushabh	40,000	2,00,000
Yesha	28,000	1,00,000
Purchases and Sales	2,80,000	5,21,000
Debtors and Creditors	1,80,000	1,20,000
Sales Return and Purchase Return	4,000	6,000
Bills Receivable and Bills Payable	30,000	41,600
Cash Balance and Bank Overdraft	2,000	28,000
Bad Debts and Provision for Doubtful Debts	800	2,600
Wages and Outstanding Wages	70,000	4,000
Machinery	80,000
Furniture	24,000
Opening Stock of Goods	92,200
Prepaid Insurance	400
Salaries	46,000
Insurance Premium	4,000
Rent -Taxes	24,000
Advertisement Expenses	5,800
Goodwill	1,44,000
Leasehold Building	28,000
8 % Loan (From 1111/22)		60,000
	10,83,200	10,83,200

Adjustments :

(1) Closing stock is of ₹ 2,20,000. Its market value is 20 % more than its value.

(2) Calculate interest on capital @ 6 % p.a.

(3) Interest on drawings to be charged from partners: Rushabh ₹ 1,800, Yesha ₹ 1,200

(4) Provision for doubtful debts is to be kept at 5 %.

(5) Outstanding expenses at the end of the year: Rent ₹ 600, Salary ₹ 1,900.

(6) Provide depreciation at 10 % on machinery and at 5 % on furniture.

(7) Write off ₹ 8,000 from Leasehold Building.

Do you agree or disagree with the following statements:

Bills receivable is a current asset.

Zalak and Kalpana are partners sharing Profit and Losses in their Capital ratio. You are required to prepare Trading Account and Profit and Loss Account for the year ended 31st March, 2023 and Balance Sheet as on that date.

Trial Balance as on 31st March, 2023
Debit Balance	Amount (₹)	Credit Balances	Amount (₹)
Sundry Debtors	56,000	Sales	2,40,000
Purchases	1,10,000	Rent	3,600
Furniture	77,000	Sundry Creditors	77,000
Plant and Machinery	1,20,000	Purchase Return	2,000
Wages	1,600	Discount	1,000
Salaries	7,000	Bills Payable	18,000
Discount	1,600	Capital A/c:
Bills Receivable	28,800	Zalak	1,80,000
Carriage Outward	2,000	Kalpana	60,000
Postage	1,000	Current A/c:
Sales Return	1,000	Zalak	10,000
Cash in Hand	8,000	Kalpana	6,000
Cash at Bank	94,000
Insurance	4,000
Opening Stock	35,600
Trade Expenses	3,000
Warehouse Rent	5,000
Advertisement	2,000
Building	40,000
	5,97,600		5,97,600

Adjustments:

(1) Stock on 31st March, 2023 was at ₹ 74,000.

(2) Sales includes, sale of machinery of ₹ 4,000, which is sold on 1st April, 2022.

(3) Depreciation on fixed assets @ 5%.

(4) Each partner is entitled to get commission at 1 % of Gross profit and interest on Capital 5 % p.a.

(5) Outstanding Expenses: Wages ₹ 400 and Salaries ₹ 1,000.

6) Create provision for Doubtful debts @ 3 % on Sundry Debtors.

Advertisement expense ₹ 80,000 paid for 2 years from 1st Jan. 2022. Calculate prepaid advertisement expense for the year ended on 31st March, 2022.

Find an odd one.

Find odd one.

Find odd one.

Expenses which are paid before due date are called as _____. - Book Keeping and Accountancy

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