S1: The Purchases Return Book records returns of goods purchased on credit. S2: The Purchases Return Book is also called the Returns Outwards Book. Which statement(s) is/are correct? MCQ with Answer and Explanation
S1: The Purchases Return Book records returns of goods purchased on credit. S2: The Purchases Return Book is also called the Returns Outwards Book. Which statement(s) is/are correct?
A. S2 only
B. Both S1 and S2
C. S1 only
D. Neither S1 nor S2
Answer: Option B
Solution (By JKSSB Mock Tests)
The Purchases Return Book records goods returned to suppliers that were originally purchased on credit. It is also known as the Returns Outwards Book because goods are going out of the business. Both statements are correct.
S1: In standard costing, the 'Idle Time Variance' is always adverse. S2: 'Abnormal Idle Time' is treated as a cost of the period and transferred to the Costing P&L. Which statement(s) is/are correct?
Explanation:
Idle time represents unproductive time, so the variance is always adverse (actual > standard). Normal idle time is absorbed in overheads, but abnormal idle time (due to strikes, accidents) is treated as a period cost and charged to the Costing P&L. Both are correct.
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