IGCSE Accounting Paper-1: Specimen Questions with Answers 270 - 273 of 338

Question 270

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One Liner▾

State any two methods of depreciation

(I) ________

(II) ________ (2)

Explanation

(I) Straight line Method

(II) Diminishing Balance Method

The various methods of depreciation are-

The Various Methods of Depreciation

Question 271

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State the meaning of provision. (Marks 1)

Explanation

  • Provision is an amount of set aside from profits to cover a known liability that may arise in future.
  • For Ex- making a provision for bad debts when it is known that some of the debtors may fail to pay their debts.

Question 272

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One Liner▾

Explain any two characteristic of accounting. (Marks 2)

Explanation

The two characteristics of accounting are-

  • Identification: It involves identifying those events or transactions which are monetary in nature. i. e. they are measurable in terms of money.
  • Recording: It implies entering the transactions in journal or the books of prime entry.

Passage

Bhargav Traders provides the following information for the year ended 31 March 2,020-

The Year Ended 31 March 2,020
$

Closing Stock

42,000

Carriage Inwards

15,000

Selling Expenses

3,600

Wages

37,000

Opening Stock

30,000

Income Tax

10,000

Purchases

140,000

Sales

240,000

Administrative Expenses

8,400

Profit on Sale of Machinery

4,000

Question 273 (1 of 5 Based on Passage)

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Short Answer▾

Which of the above two ratios are complementary?

Explanation

Operating Ratio and Operating Profit Ratio

Explanation:

Net Sales is the sum of Operating Costs and Operating Profit. i. e.

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