Under the 'Cash Basis' of accounting, outstanding expenses are: MCQ with Answer and Explanation

Question
Under the 'Cash Basis' of accounting, outstanding expenses are:
A. Recorded as liability
B. Recorded as income
C. Recorded as asset
D. Not recorded
Answer: Option D
Solution (By JKSSB Mock Tests)
Cash basis only records cash transactions, so outstanding expenses are ignored.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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Question #1
If a company changes its depreciation method from Straight Line to Written Down Value to manipulate profits, which accounting convention is violated?
A. Full Disclosure
B. Consistency
C. Materiality
D. Conservatism
Discuss
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Correct Answer: Option B

Explanation:
The convention of Consistency requires that accounting policies remain unchanged from one period to another to allow valid comparisons.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #2
The 'Ind AS 24' on Related Party Disclosures requires disclosure of:
A. Only parent-subsidiary relationships
B. Relationships, transactions, and outstanding balances with related parties
C. Only compensation of key management personnel
D. Only transactions with key management personnel
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Correct Answer: Option B

Explanation:
Ind AS 24 requires disclosure of related party relationships, transactions, and balances.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
Question #3
The 'Final Dividend' is recommended by:
A. Auditors
B. Registrar
C. Shareholders
D. Board of Directors
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Correct Answer: Option D

Explanation:
Board recommends final dividend, which is then approved by shareholders in AGM.
This question belongs to: Accountancy and Statistics Accountancy and Book Keeping
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