Rectification

answered on 29-Feb-20 06:19

Investment were sold for Rs 75000 at a profit of Rs 15000 and passed through sales account

latest answer

Since 75,000 was credited to sales, entire amount must be reversed.

DIVYA S

CA Final

★ 53K+

4

919

Ca. Foundation

answered on 26-Feb-20 21:01

How should I practice CA foundation accountancy further, as I have solved all the chapters once for, upcoming may exam

latest answer

Please solve prevous year paper and RTPs of past attempt

Sugar Genius

CA Foundation

★ 2K+

1

631

Managerial Remuneration

answered on 29-Feb-20 06:20

How is the Managerial Remuneration existing in profit and loss without computation?

latest answer

To check if it is within limits. Company might have provided extra or less.

Raviteja Kusumanchi

CA Final

★ 42K+

4

611

Dividend distribution tax

answered on 26-Feb-20 18:39

1.Can general reserve be used to set off the DDT in case of inadequate profits? Or will it be continued to be shown as a loss ? 2. Is DDT applicable in new tax regime?

latest answer

4%. For tax rates, you can refer to the updated income tax notes in Notes section of App.

Raviteja Kusumanchi

CA Final

★ 42K+

4

603

Doubt

answered on 26-Feb-20 17:54

On 1st jan provision for doubtful debts existed at 40,000.Trade receivables on 31-12-17 were 15,00,000;bad debts totalled 1,00,0000.it is required to write off the bad debts and create a provision equal to 5% of trade receivables balances. In the above problem when we create provision for bad debts account why we enter open balance of provision for doubtful debts in credit side of provision account. Can any one suggest me so that it would be helpful

latest answer

When the amount is not recoverable we call it bad debt and reduce it from debtors. Bad Debts A/c Dr. [This is ultimately transferred to P&L] To Trade Receivables/Sundry Debtors [Here actual balance in debtor is being reduced] What is a provision for bad debt? Basically , the business is keeping aside some amount to take care of bad debts which might arise in future. Say Current debtors are 1,00,000 and the company expects 5% will not pay (based on past experience). For this the company would make a provision of Rs.5,000. Here the company would not credit the debtors by 5,000 (as we do in case of actual bad debt) because the debtors is not yet bad. So for this we create a provision (set aside amount from profits). Profit & Loss Dr. To Provision for bad debt (This will always be a credit balance) Now in next year say 0,000 of debtors became bad. Bad Debts Dr. 9,000 To Debtors 9,000 Now the bad debt is an expense which has to be transferred to P&L. Out of 9,000 , 5,000 was already provided last year. So we will use that provision now. Dr. Provision for bad debt 5,000 Dr. Profit & Loss 4,000 (for balance ) Cr. Bad debts 9,000. For any new provision to be created, similar entries as passed earlier. [These are actual entries - In exams we can combine and pass entries]

sai t

CA Foundation

★ 2K+

16

2K+

Practice questions

answered on 26-Feb-20 17:55

Sir where can I get practice questions for CA Foundation accounts which is helpful for preparing for exams

latest answer

Refer to past exam questions and RTPs.

sai t

CA Foundation

★ 2K+

1

591

Dividend Declared treatment in financial statement

answered on 26-Feb-20 17:57

Dividend declared means declared by the shareholders in annual general meeting. And AGM happens after the financial statement gets approved by board & gets audited by auditor And we prepare financial statement on 31st March Then how dividend Declared can be accounted in that financial year ?

latest answer

Dividends declared on AGM (Say in September 2019) will be accounted as dividend in financial year 2019-20. The concept of provision for dividend no longer exists. Dividend is accounted only when approved - by BOD in case of interim dividends and by Shareholders in AGM in case of Final dividend.

Chandan Subudhi

CA Final

★ 12K+

6

3K+

Insurance claim

answered on 26-Feb-20 17:57

Sir, in this they add firefight exp after apply of average clause but as per theory we have to deduct the fire fight expenses from salvage value

latest answer

Fire fight expenses is generally deducted from salvage value.

subramanyam yendakuarthi

CMA Final

★ 4K+

1

771

Preliminary expenses

answered on 24-Feb-20 22:26

Should we account for full amount of preliminary expense in year 1 or charge it over a period in p&l ?

latest answer

Okay sir

Raviteja Kusumanchi

CA Final

★ 42K+

2

663

Preparation of financial statements

answered on 24-Feb-20 22:26

Can we disclose interim dividend as finance cost instead of showing as an appropriation out of profits ?

latest answer

Okay sir

Raviteja Kusumanchi

CA Final

★ 42K+

2

561