Under single entry system, profit = closing capital - opening capital + drawings - additional capital introduced. This statement is: MCQ with Answer and Explanation

Question

Under single entry system, profit = closing capital - opening capital + drawings - additional capital introduced. This statement is:

A. Correct

B. Incorrect

C. Partially correct, needs other adjustments

D. Only for companies

Answer: Option A

Solution (By JKSSB Mock Tests)

In single entry, adjusted profit is derived from capital comparison: Profit = Closing capital + Drawings - Opening capital - Additional capital.

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

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Question #1

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The 'FASB' is the accounting standard-setting body of:

A. India

B. United States

C. United Kingdom

D. Japan

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Correct Answer: Option B

Explanation:
Financial Accounting Standards Board (FASB) sets US GAAP.

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

Question #2

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Which working capital financing approach uses short-term funds to finance temporary current assets and long-term funds to finance permanent current assets?

A. Aggressive Approach

B. Zero Working Capital Approach

C. Matching (Hedging) Approach

D. Conservative Approach

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Correct Answer: Option C

Explanation:
The matching approach synchronizes the maturity of the financing source with the life of the asset being financed.

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Question #3

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CSR (Corporate Social Responsibility) is mandatory under the Companies Act 2013 for companies with a net profit of at least:

A. Rs 5 Crores

B. Rs 1 Crore

C. Rs 10 Crores

D. Rs 50 Crores

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Correct Answer: Option A

Explanation:
Section 135 mandates CSR for companies with Net Worth ≥ 500 Cr, Turnover ≥ 1000 Cr, or Net Profit ≥ 5 Cr.

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

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