Question 6: Explain how to deal with the following in the cost accounts. Each answer should be in two gr three sentences only, showing also the appropriate journal entry, wherever necessary, (a) A shortage of 10 kg. of a store item (book value 150) was noticed during physical verification, Investigation revealed that it was due to natural causes. (b) An abnormal gain of ₹42,500 was notice in process "A" of a chemical factory at the end of month, (c) A sum of $15,000 was realized by sale of sawdust and useless scantlings in a furniture making business. (d) In a factory, using historical cost system, there was under recovery of fixed factory overheads amounting to ₹24,000 at the end of the accounting period. (e) A company spent 15 lakhs on advertisement in the national television network before launching a new product. (f) A sum of $20,000 was incurred on printing and stationary in connection with the issue of non convertible debentures by a company. (g) A sum of 7,500 was paid as wages to workers in a factory when there was no work due to power failure. (h) Overtime wages amounting to ₹500 were incurred to meet an urgent order of a customer who wanted the delivery date to be advanced. (1 gel)
Question 6: Explain how to deal with the following in the cost accounts. Each answer should be in two gr three sentences only, showing also the appropriate journal entry, wherever necessary, (a) A shortage of 10 kg. of a store item (book value 150) was noticed during physical verification, Investigation revealed that it was due to natural causes. (b) An abnormal gain of ₹42,500 was notice in process "A" of a chemical factory at the end of month, (c) A sum of $15,000 was realized by sale of sawdust and useless scantlings in a furniture making business. (d) In a factory, using historical cost system, there was under recovery of fixed factory overheads amounting to ₹24,000 at the end of the accounting period. (e) A company spent 15 lakhs on advertisement in the national television network before launching a new product. (f) A sum of $20,000 was incurred on printing and stationary in connection with the issue of non convertible debentures by a company. (g) A sum of 7,500 was paid as wages to workers in a factory when there was no work due to power failure. (h) Overtime wages amounting to ₹500 were incurred to meet an urgent order of a customer who wanted the delivery date to be advanced. (1 gel)
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:Question 6 : Explain how to deal with the following in the cost accounts. Each answer should be in two or
three sentences only, showing also the appropriate journal entry, wherever necessary,
(a) A shortage of 10 kg. of a store item (book value *150) was noticed during physical verification,
Investigation revealed that it was due to natural causes.
(b) An abnormal gain of ₹42,500 was notice in process "A" of a chemical factory at the end of month,
(c) A sum of 15,000 was realized by sale of sawdust and useless scantlings in a furniture making
business.
(d)
In a factory, using historical cost system, there was under recovery of fixed factory overheads
amounting to *24,000 at the end of the accounting period.
(e)
A company spent ₹15 lakhs on advertisement in the national television network before launching a new
product.
(f) A sum of ₹20,000 was incurred on printing and stationary in connection with the issue of non convertible
debentures by a company.
(g) A sum of 7,500 was paid as wages to workers in a factory when there was no work due to power
failure.
(h) Overtime wages amounting to ₹500 were incurred to meet an urgent order of a customer who wanted
the delivery date to be advanced.
gel)
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