The results and position disclosed by final accounts are not exact. [RTP Jan. 2025]
Options
A
B
C
D
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Preparation of Final Accounts of Sole ProprietorsQ-6 | Final Accounts of Sole ProprietorsQuestion 5115 of 40
All Questions Correct Answer
✅ Option — Correct Option
All Options:
- A
- B
- C
- D
Detailed Solution & Explanation
True: They are prepared on the basis of assumptions, conventions, concepts and personal
judgements of the person who prepare them.
PRACTICAL QUESTIONS
More Questions from Preparation of Final Accounts of Sole Proprietors
Mr. A accepts two bills of exchange on June 1, 2024 for ₹ 1,50,000 and 60,000 drawn on him by Mr. B. The bill of exchange for ₹ 1,50,000 is for two months while the bill of exchange for 60,000 is for three months. Mr. B got the first bill discounted with the bank for ₹ 1,49,000 on June 3, 2024. On August 2, 2024 Mr. A requested Mr. B. to cancel both the bills and drew a new bill on him with the combined amount of both the bills along with interest @ 12% per annum for a period of two months. Before the due date of the renewed bill on September 3, 2024, Mr. A becomes insolvent and only 40 paise in a rupee could be recovered from his estate. You are required to give the journal entries in the books of Mr. B. [Jan. 2025, 5 Marks]
Discuss the limitations which must be kept in mind while evaluating the Financial Statements. [Nov. 2018, 4 Marks]
Trading account
Profit and loss account
Balance sheet
Manufacturing A/c
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