Question No 03 Chapter No 17

Question No 03 Chapter No 17

03. Classify the following into Capital, revenue and Deferred Revenue expenditure, Stating reasons in each case.

  1. A sum of Rs 32,000 has been spent on a machine as follows: Rs 20,000 for addition to Double the output, (ii) Rs 5,000 for repairs necessitated by negligence and (iii) Rs 7,000 for replacement of worn –out parts
  2. Total expenditure on a cinema building during the year was Rs 2,00,000 out of which 20% related to repair and 80% represented improvement and additional
  3. Compensation paid to a retrenched employee for the loss of employment
  4. Second- hand furniture worth Rs 40,000 was purchased and repairing of this furniture cost Rs 15,000. the
  5. furniture was installed by own-wages for this bills Rs 5,000
  6. A person was injured by the motor car of the company Rs 10,000 was paid to him by was of compensation
    Advertisement expenditure in expenditure in Special advertisement drive.

The solution of Question No 03 Chapter No 17: –

aRs 20,000 Capital Expenditure and Rs 12,000 is revenue Expenditure
bRs 40,000 is revenue Expenditure and Rs 1,60,000 is capital Expenditures
cIt is a Revenue Expenditure
dIt is a Capital Expenditure and will be Debited to Furniture Account
fIt is a Deferred Expenditure so that entire burden may not fall on one year.

The provision in accounting: Types and Treatment

Also, Check out the solved question of all Chapters: –

D K Goel – New ISC Accountancy -(Class 11 – ICSE)- Solution

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ISC Accounts 11 20 Image min 197x300 - Question No 03 Chapter No 17 - D.K Goal 11 Class
D K Goel accountancy +1 – ISC_Accounts_11_20_ImageQuestion No 42 Chapter No 11 – D.K Goal 11 Class

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