S1: Vouching is the examination of documentary evidence. S2: Verification is the proof of ownership, existence, and valuation of assets. Which statement(s) is/are correct?
Explanation:
Vouching involves checking vouchers to verify the authenticity of transactions. Verification goes beyond vouching to confirm the physical existence, legal ownership, and proper valuation of assets and liabilities at the balance sheet date. Both are correct.
In cost accounting, the 'Economic Batch Quantity' (EBQ) formula is identical to the EOQ formula. If the setup cost per batch is ₹500, annual demand is 10,000 units, and carrying cost is ₹10 per unit per annum, what is the EBQ?
Explanation:
The matching concept dictates that expenses incurred in a period must be recognized in the same period as the revenues they helped to generate.
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