IGCSE Accounting Paper-2: Specimen Questions with Answers 130 - 131 of 189

Question number: 130

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One Liner Question▾

Write in Brief

Obligations i. e. amount owed by the organization are referred to as________ (Marks 1)

Explanation

Liabilities

  • Liabilities are company’s financial debts or obligations that arise during the business operations. This is the amount a business owes others.

  • Liabilities include loans, mortgages, trade payables, unearned income, accrued expenses etc.

Question number: 131

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Short Answer Question▾

Write in Short

Show with a tick mark where the following items would appear in the final accounts of a partnership. (Marks 4)

The final accounts of a partnershipThe final accounts of a partnership

Items

P&L A/c

P&L Appropriation A/c

(I) Interest on Loan

(II) Interest on a Partner’s Loan

(III) Interest on Partner’s Drawings

(V) Partner’s Salary

Explanation

Ans (c)

The final accounts of a partnershipThe final accounts of a partnership

Items

P&L A/c

P&L Appropriation A/c

(I) Interest on Loan

Image show of the Right

Image Show of the Right

(II) Interest on a Partner’s Loan

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Image Show of the Right

(III) Interest on Partner’s Drawings

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Image Show of the Right

(V) Partner’s Salary

Image show of the Right

Image Show of the Right

  • Profits & Loss A/c debits the expenses which are charge against the profits i. e. that is they have to pay irrespective of whether the firm earns profits or bears a loss. Interest on any loan is a charge against profits.

  • Profits & Loss Appropriation A/c shows distributions of profits in the form of interest on partners’ capital, salary, reserves etc.

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