Class 11 Accountancy - Chapter Depreciation, Provisions and Reserves NCERT Solutions | Basaria Confectioner bought a cold stora

State whether the following statements are true or false:

1. Depreciation is a non-cash expense.
2. Depreciation is also charged on current assets.
3. Depreciation is decline in the market value of tangible fixed assets.
4. The main cause of depreciation is wear and tear caused by its usage.
5. Depreciation must be charged so as to ascertain true profit or loss of the business.
6. Depletion term is used in case of intangible assets.
7. Depreciation provides fund for replacement.
8. When market value of an asset is higher than book value, depreciation is not charged.
9. Depreciation is charged to reduce the value of asset to its market value.
10. If adequate maintenance expenditure is incurred, depreciation need not be charged.

State briefly the need for providing depreciation.

Give four examples each of ‘revenue reserve’ and ‘capital reserves’.

Explain the concept of depreciation. What is the need for charging depreciation and what are the causes of depreciation?

Give four examples each of ‘provision’ and ‘reserves’.

Name and explain different types of reserves in detail.

What are the effects of depreciation on profit and loss account and balance sheet?

State with reasons whether the following statements are True or False ;
(i) Making excessive provision for doubtful debits builds up the secret reserve in the business.
(ii) Capital reserves are normally created out of free or distributable profits.
(iii) Dividend equalisation reserve is an example of general reserve.
(iv) General reserve can be used only for some specific purposes.
(v) ‘Provision’ is a charge against profit.
(vi) Reserves are created to meet future expenses or losses the amount of which is not certain.
(vii) Creation of reserve reduces taxable profits of the business.

Discuss in detail the straight line method and written down value method of depreciation. Distinguish between the two and also give situations where they are useful.

Distinguish between ‘general reserve’ and ‘specific reserve’.

Name any two types of commonly used negotiable instruments.

Why is it necessary to record the adjusting entries in the preparation of final accounts?

State the meaning of incomplete records?

Briefly state how the cash book is both journal and a ledger.

State the meaning of a trial balance?

State the four basic requirements of a database applications.

Define accounting.

State the different elements of a computer system.

Why is it necessary for accountants to assume that business entity will remain a going concern?

State the need for the preparation of bank reconciliation statement?

Give the performa of a Bill of Exchange.

If the opening capital is Rs. 50,000 as on April 01, 2016 and additional capital introduced Rs. 10,000 on January 01, 2017. Interest charge on capital 10% p.a. The amount of interest on capital shown in profit and loss account as on March 31, 2017 will be :
  (a) Rs. 5,250                  (b) Rs. 6,000
  (c) Rs. 4,000                  (d) Rs. 3,000

Furniture purchased from M/s Rao Furnishigs for 8,000 was entered into the purchases book.
This is the error of ........................................
State the wrong entry recorded in the book of accounts

Correct effect should have been:

The rectification entry will be:

Why is it necessary for accountants to assume that business entity will remain a going concern?

Briefly state how the cash book is both journal and a ledger.

What is meant by maturity of a bill of exchange?

What is meant by acceptance of a bill of exchange?

State the nature of accounting information required by long-term lenders.

What is petty cash book? Write the advantages of petty cash book?

Cash received from Karim  6,000 posted to Nadeem.
This is the error of ........................................
State the wrong entry recorded in the book of accounts:

Correct effect should have been:

The rectification entry will be: