A revenue expenditure wrongly capitalized will lead to: MCQ with Answer and Explanation

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A revenue expenditure wrongly capitalized will lead to:

A. Overstatement of liabilities

B. Understatement of assets and profit

C. Overstatement of assets and profit

D. No effect

Answer: Option C

Solution (By JKSSB Mock Tests)

Capitalizing revenue expense increases assets and reduces expenses, thus overstating profit and assets.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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The 'Composition Scheme' under GST is optional for:

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B. Large taxpayers

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Correct Answer: Option A

Explanation:
Small taxpayers can opt for composition levy to reduce compliance burden.

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'Unclaimed Dividend' is shown in Balance Sheet as:

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Correct Answer: Option D

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Correct Answer: Option B

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Incremental costs (like sales commissions) are capitalised if expected to be recovered.

This question belongs to: Accountancy and Statistics Accountancy and Book Keeping

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