1. All direct expenses are debited to Trading account.
True
2. The Balance Sheet is a nominal account. False
3. Discount allowed to debtors is called as bad debts.
False
4. Profit and loss account is a nominal account True
5. The interest on drawings is an income of the firm.
True
6. The interest on capital is an income of the firm.
False
7. Trading account is a nominal account. True
8. Prepaid expenses are shown on the asset side of the
Balance sheet. True
9. Closing stock is always valued at market price. False
10. Outstanding expenses are shown on the liability side
of the Balance sheet. True
11. Partners must share profits and losses equally. False
12. Trial Balance is the base of Final account. True
13. Debit balance of Trading account shows gross profit.
False
14. Credit balance of profit and loss account shows net
profit of the business. True
15. Return inward is deducted from purchases. False
16. Unproductive wages are debited to trading a/c. False
17. Royalty is debited to profit & loss a/c. False
18. Wages & salaries is treated as indirect expense.
False
19. Balance sheet is not an account. True
20. Fictitious assets are intangible assets. True
21. Current assets are also called as floating assets.
True
22. Income received, but not earned is an asset. False
23. Outstanding wages is a nominal a/c. False
24. Final accounts are prepared end of the accounting
year. True
