Lakshya Education MCQs

Question: The estimated value at which an asset is expected to be sold after the end of its useful life is called
Options:
A.Residual value
B.Salvage value
C.Scrap value
D.All of the above
Answer: Option D

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Question 1. Which of the following is a selling expense?
  1.    Any tax/freight is paid on purchases
  2.    General salaries paid to laborers
  3.    Tax & freight paid on sale
  4.    Interest on deposits
Answer: Option C
Question 2. Which one of the following is NOT true about capital expenditure?
  1.    Creates future benefits
  2.    Incurred to acquire fixed assets
  3.    Incurred to increase the economic life of existing fixed assets
  4.    Reduce the profit of the concern
Answer: Option D
Question 3. A debit balance in the bank statement indicates
  1.    Cash at bank
  2.    Bank overdraft
  3.    Over payment to creditors
  4.    Cash in hand
Answer: Option B
Question 4. Which of the following financial statements show the financial health of an organisation at a stated point of time?
  1.    Balance sheet
  2.    Trading and Profit & Loss account
  3.    Cash flow statement
  4.    Statement of retained earnings
Answer: Option A
Question 5. Double entry accounting system includes
  1.    Accrual accounting only
  2.    Cash accounting only
  3.    Both cash and accrual accounting
  4.    None of the above
Answer: Option C
Question 6. Cost incurred for the maintenance of shop is considered as
  1.    Deffered expense
  2.    Capital expenditure
  3.    Revenue expenditure
  4.    Preliminary expense
Answer: Option C

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