Which accounting system violates the matching principle?
A. Cash System
B. Fund-based System
C. Mercantile System
D. Accrual System
Answer: Option A
Solution (By JKSSB Mock Tests)
The cash system violates the matching principle because it does not match the revenues of a specific period with the expenses incurred to generate them.
S1: Revaluation Account is a real account. S2: Revaluation Account is prepared to show the effect of revaluation on partners' capital. Which statement(s) is/are correct?
Explanation:
Revaluation Account is a nominal account, not a real account, as it records expenses and incomes related to revaluation. Its purpose is indeed to show the net effect on partners' capital. S1 is incorrect, S2 is correct.
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