Cash basis accounting recognizes revenue when: MCQ with Answer and Explanation

Question
Cash basis accounting recognizes revenue when:
A. Order is received
B. Cash is received
C. Sale invoice is raised
D. Services are performed
Answer: Option B
Solution (By JKSSB Mock Tests)
Under cash basis, transactions are recorded only when cash is received or paid, not when accrued.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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Question #1
Which of the following is a 'period cost'?
A. Royalty on production
B. Direct labour
C. Direct material
D. Rent of office building
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Correct Answer: Option D

Explanation:
Period costs are not tied to production volume and are expensed in the period incurred. Office rent is a period cost.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #2
The 'Double Taxation Avoidance Agreement' (DTAA) aims to:
A. Increase tax rates
B. Unify all taxes
C. Avoid double taxation of same income in two countries
D. Tax income twice
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Correct Answer: Option C

Explanation:
DTAA provides relief from double taxation through exemption or credit method.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #3
The 'Borrowing Costs' (Ind AS 23) that are directly attributable to acquisition, construction, or production of a qualifying asset are:
A. Expensed immediately
B. Ignored
C. Written off over 10 years
D. Capitalised as part of the cost of that asset
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Correct Answer: Option D

Explanation:
Borrowing costs on qualifying assets are capitalised.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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