All items of revenue concerning current year - whether received in cash or not - and all items of expenses - whether paid in cash or not - are considered in which account ?

Trading Account

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Profit and Loss Account

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Both Trading and Profit & Loss Account

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None of the above

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Solution

The correct option is B Profit and Loss Account
All items of revenue concerning current year - whether received in cash or not - and all items of expenses - whether paid in cash or not - are considered in Profit and Loss Account. Profit and loss account is prepared to know the net profit earned or net loss incurred during the year. To know the actual profit or loss, all the revenue and expenses are recorded in this account.

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Similar questions

Q. All items of ________ value are shown under Trading and Profit & loss Account.

State whether the following statement are true or false.

1. Final Accounts are prepared on the basis of Trial Balance.
2. Trading Account is a part of Profit & Loss Account.
3. Profit Loss Account is prepared to find out Gross Profit or Gross Loss.
4. Gross Profit or Gross Loss is transferred to Balance Sheet.
5. An amount of net profit is added to the capital.
6. All indirect expenses are debited to trading account.
7. Balance Sheet is a statement and not an account.
8. Capital account is a personal account.
9. Amount of prepaid expenses appears on assets side.
10. Bank Overdraft is a liability of business concern.

Q. All expenses incurred in case of Trading and Profit & loss account are ___________ in nature.

Salaries paid would be charged to which account - trading account or profit and loss account?

Q. All expense and _______accounts appearing in the trial balance are transferred to the trading and profit and loss account.

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