Advertisement

Question 3 Chapter 2 – Unimax Publications of Class 11

Question 3 Chapter 2 - Unimax Publications of Class 11

Advertisement

Question 3 Chapter 2 – Unimax Publications of Class 11

Atul , a consultant, during the financial year 2019-20 earned Rs. 4,00,000. Out of which be received Rs. 3,50,000. He incurred an expense of Rs. 1,70,000, out of which Rs. 40,000 are outstanding. He also received consultancy fee relating to previous year Rs. 45,000 and also paid Rs. 20,000 expenses of last year. You are required to determine his income for the year, if
(a) He follows Cash Basis of Accounting and
(b) He follows Accrual Basis of Accounting.

The solution of Question 3 Chapter 2 – Unimax Publications of Class 11

 Rs
(a)  Revenues (Inflow of Cash i.e. Cash Sales)3,50,000
Less: Expenses (Outflow of Cash) (1,70,000-40,000) 1,30,000
Income 2,20,000
Add: Other (Inflow of Cash) (45,000-20,000)25,000
Net Income
2,45,000
  
(b) Total Sales of the year 
4,00,000
Total Expenses for the year
1,70,000
Net Income =
2,30,000

Advertisement

Leave a Reply

Your email address will not be published. Required fields are marked *