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The Cost Of Repairing Damage To A Machine Or Equipment During The Installation Is Treated As A Capital Expenditure Or A Revenue Expenditure The answer is “False” , as the cost of repairing damage to a machine or equipment during the installation is charged to Profit And Loss Account rather than it is added to the cost of machine / equipment according to IAS 16.12. The cost is not debited or added to machine or equipment account as the machine or equipment is in the location and condition necessary for operating in the same manner as intended by the management. Also, it is a repair expense ( Revenue Expenditure ) during day to day working, so it does not enhance / increase the cost of machine or equipment as it is not a Capital Expenditure . Initially, the machine / equipment is recorded at cost and all the necessary costs incurred to bring the machine into working condition for its intended use are added to the costs of machine or equipment, otherwise, charged to profit and loss...

Purchased Paper For Printing Journal Entry If a company purchased paper for printing for cash or by cheque then the journal entry is to debit stationary account and credit cash / bank account. Here, stationary is an expense account and cash or bank account is a Current Asset . If we purchased paper for printing on account, then we debit stationery account and credit accounts payable account instead of cash account. Purchased stationery for personal use and for office use If we purchased stationery for personal use for cash, then we debit Drawings Account and credit Cash Account. Example: Purchased stationery worth 8,000 for office use and 2,000 for personal use For Office Use                                  Stationary a/c  Rs. 8000                                             ...

Bought Printer For Cash / Cheque Or On Account / Credit Journal Entry With The Help Of An Example When a company or corporation purchased a printer for cash or by cheque, for use in the business, then we debit printer account (or Office Equipment Account ) and credit cash or bank account. If the company purchased printer on account or credit, then, printer account, as an asset, is debited and Accounts Payable Account / Sundry Creditors Account is credited. Example: A company purchased a computer printer on account for $500. The entry to record this Business Transaction is shown below:                               Computer Printer a/c  $500                                                                        Account...

Journal Entry For Commission Received Partially By Check And Partially Received In Advance We can either record two entries or a single combine entry. In both cases, the result is the same. Method 1 Firstly, we record the entry at the time when the Commission Received in full amount as shown below:                                           Bank a/c  $20,000                                                               Commission Revenue a/c  $20,000                                                          (Commission Received By Cheque) The portion of Commission r...

Unearned Revenue Adjusting Entry Resulted In The Debit And Credit To What Accounts? In an Unearned Revenue Adjusting Entry , we debit Unearned Revenue Account as a Current Liability and credit relevant Revenue Account when the company earned the revenue account. Initially, when the company received cash / bank from clients in advance for services which are to be rendered in future, then cash or bank account is debited and unearned revenue account, as a current liability, is credited as the company did not earn the revenue and now it has to performed the services against the cash or check / cheque received from the clients. So, initially, when the company received Cash or check received, and deposited into bank account, from client, then we record the following entry as shown below:                                 Cash a/c / Bank a/c  XXX                ...

Answer Of True Or False Question Current Ratio is calculated as Current Assets divided by Current Liabilities for the period. If the current assets are more than then the company can easily meet its short-term debts. If current ratio is equal to 1, then it means that the company all the current assets are used to offset current liabilities. If the current ratio is more than 1, then the company has more current assets to meet current liabilities. If the company has current ratio less than 1 then the company has not enough current assets to meet current liabilities. It is “False” as proved from below calculation: We know Current Ratio is equal to the following formula: Current Ratio  =   Current Assets / Current Liabilities) Here: Current Assets = Cash + Marketable Securities + Accounts Receivable + Inventories By putting the value, we have: Current Assets = $75,000 + $11,000 + $90,000 + $225,000 = $500000 Current Liabilities  =  $200,000 ...

The Correct Answer Of Short Question Is  T-Account The most convenient and fastest way of transferring Journal Entries to the  Ledger is by using T-Account as it is easy to record accounts (Assets, Liabilities, Equity, Revenues and Expenses) on t-account having a title of a particular account and having a left side (or debit side) and a right side (credit side). For example, if salary t account is prepared, then it is shown below: Salary T Account For The Month Of July, 2023   Date            Particulars             Amount             Date           Particulars          Amount July 2023                                          $               July 2023      ...