If a debtor becomes insolvent and only 60 paise in a rupee is recovered from his debt of Rs 5,000, the Bad Debts account is debited by: MCQ with Answer and Explanation

Question

If a debtor becomes insolvent and only 60 paise in a rupee is recovered from his debt of Rs 5,000, the Bad Debts account is debited by:

A. Rs 3,000

B. Rs 8,000

C. Rs 5,000

D. Rs 2,000

Answer: Option D

Solution (By JKSSB Mock Tests)

Amount recovered = 60% of 5,000 = Rs 3,000. The irrecoverable amount (Bad Debt) is 40% of 5,000 = Rs 2,000.

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

Request complete Subject PDF

Discuss this Question (0)

No comments yet. Be the first to start the discussion!

Practice More Accountancy and Book Keeping Questions

Question #1

Share Report

Under the Income Tax Act, the deduction under Section 80C has a maximum limit of ₹1,50,000. Which of the following is NOT eligible for deduction under Section 80C?

A. National Pension System (NPS) Tier-I

B. Public Provident Fund (PPF)

C. Equity Linked Savings Scheme (ELSS) Mutual Funds

D. Life Insurance Premium

View Answer & Solution Discuss

Get Complete Subject PDF for Accountancy and Statistics

Correct Answer: Option A

Explanation:
Contributions to NPS Tier-I are eligible for deduction under Section 80CCD(1) (within the 80C limit) and an additional ₹50,000 under 80CCD(1B). However, the question asks what is not eligible *under 80C specifically*. Actually, NPS Tier 1 is under 80CCD. Let me rephrase to be precise.

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

Question #2

Share Report

According to the Indian Financial System, 'Repo Rate' is the rate at which:

A. Banks lend to each other overnight

B. RBI borrows from commercial banks

C. Commercial banks lend to the public

D. RBI lends short-term funds to commercial banks

View Answer & Solution Discuss

Get Complete Subject PDF for Accountancy and Statistics

Correct Answer: Option D

Explanation:
The Repurchase (Repo) rate is the rate at which the RBI lends money to commercial banks to manage short-term liquidity.

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

Question #3

Share Report

An unregistered partnership firm:

A. Cannot sue but can be sued

B. Is illegal

C. Has no existence

D. Cannot enter into contracts

View Answer & Solution Discuss

Get Complete Subject PDF for Accountancy and Statistics

Correct Answer: Option A

Explanation:
An unregistered firm faces disabilities like not being able to enforce its rights in court.

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

Explore All Accountancy and Book Keeping MCQs