Question No 3 Chapter No 2
3. Calculate the interest expense for the calendar year 2015, when books are maintained on
(i) cash basis
(ii) Mercantile basis
Interest paid during 2015 Rs 26,000. Interest dur but not paid on dec. 31,2015 was Rs 2,600. Interest payable on Jan. 1,2015 was Rs 6,200
The solution of Question No 3 Chapter No 2: –
(i) Cash Basis . Interest paid during the year 2016 i.e. Rs 26,000is expense for the year.
(ii) Mercantile basis. Interest expense for the year 2015 is calculated as follows:
| Particular |
Amount | |
| Interest paid during the year | 26,000 | |
| Add: Interest due but not paid at the end | 2,600 | |
| 28,600 | ||
| Less: Commission payable in the beginning of the year | 6,200 | |
| Interest Expenses | 22,400 | |
Financial Accounting – Introduction and its Functions
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Usha Publication – Elements of Book-Keeping PSEB (Class 11) – Solution
Chapter No. 2 – Theory Base of Accounting
Chapter No. 3 – Origin of Transactions
Chapter No. 4 – Vouchers and transactions
Chapter No. 6 – Accounting for Goods and Services Tax(GST)
Chapter No. 9 – Other Subsidiary Books
Chapter No. 10 – Journal Proper
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Chapter No. 11 – Trial Balance
Chapter No. 12 – Bank Reconciliation Statement
Chapter No. 14 – Provisions and Reserves
Chapter No. 15 – Bills of Exchange
Chapter No. 16 – Rectification of Errors
Chapter No. 17 – Financial Statements – (Without Adjustments)