Insurance unexpired accounts is a _____________.

Real account

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Personal account

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Nominal account

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None of these

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Solution

The correct option is B Personal account
Unexpired insurance is an another term which is used for prepaid insurance. Prepaid insurance is deducted from the insurance premium expenses account in profit & loss account and shown in balance sheet as current assets.

For example, if an insurance premium of Rs.1200 is paid for the period from 1st July 2017 to 30th June 2018, an amount equal to Rs.300 (for 3 months , April, May,June 2018) is unexpired as it is not pertaining to the current financial year 2017-18. Its a representative personal account. These accounts are not in the name of a specific person but are represented as personal account.

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Similar questions

Q. Insurance unexpired account is a __________.

Q. The following balances were extracted from the books of M/s Panchsheel Garments on March 31, 2017.

Account Title	Debit Amount (₹)	Account Title	Credit Amount (₹)
Opening stock	16,000	Sales	1,12,000
Purchases	67,600	Return outwards	3,200
Return Inwards	4,600	Discount	1,400
Carriage inwards	1,400	Bank overdraft	10,000
General expenses	2,400	Commission	1,800
Insurance	4,000	Creditors	16,000
Scooter expenses	200	Capital	50,000
Salary	8,800
Cash in hand	4,000
Scooter	8,000
Furniture	5,200
Buildings	65,000
Debtors	6,000
Wages	1,200

	1,94,400		1,94,400

Prepare the trading and profit and loss account for the year ended March 31, 2017 and a balance sheet as on that date.
(a) Unexpired insurance ₹ 1,000.
(b) Salary due but not paid ₹ 1,800.
(c) Wages outstanding ₹ 200.
(d) Interest on capital 5%.
(e) Scooter is depreciated @ 5%.
(f) Furniture is depreciated ₹ @ 10%.
(g) Closing stock was ₹ 15,000.

Q. Classify the following accounts under personal, real or nominal accounts:

(i) Commission Paid	(ii) Commission Received
(iii) Commission Accrued	(iv) Prepaid Salaries
(v) Leasehold Property A/c	(vi) Discount Allowed
(vii) Carriage Inwards A/c	(viii) Life Insurance Corporation of India
(ix) Drawings A/c	(x) Rent Received in Advance
(xi) Debtors	(xii) Sales A/c
(xii) Rent Paid in Advance	(xiv) Bank Overdraft

Objective type Questions
Classify the following accounts under the types of personal, Real and Nominal account.

1) Life insurance premium A/c
2) Mr. Kulkarnis’s Capital A/c
3) Goods A/c
4) Freight A/c
5) Wages A/c
6) Goodwill A/c
7) Copyright A/c
8) Outstanding income A/c
9) Bank charges A/c
10) Outstanding expenses A/c
11) Sundry income A/c
12) Income receivable A/c
13) Export duty A/c
14) Furniture A/c
15) Import duty A/c
16) Free sample distribution A/c
17) Sundry expenses A/c
18) Discount A/c
19) Drawings A/c
20) Fixed deposit A/c
21) Profit on sale of furniture A/c
22) Office equipment A/c
23) Bank of India A/c
24) Machinery A/c
25) Carriage Outward A/c
26) Loss on sale of machinery A/c
27) Loan A/c
28) Deposits with MSEB
29) Loss by fine A/c
30) Legal expenses A/c

The following balances were extracted from the books of M/s Panchsheel Garments on March 31, 2017.

Account Title	Debit Amount Rs	Account Title	Credit Amount Rs
Opening stock	16,000	Sales	1,12,000
Purchases	67,600	Return outwards	3,200
Return Inwards	4,600	Discount	1,400
Carriage inwards	1,400	Bank overdraft	10,000
General expenses	2,400	Commission	1,800
Insurance	4,000	Creditors	16,000
Scooter expenses	200	Capital	50,000
Salary	8,800
Cash in hand	4,000
Scooter	8,000
Furniture	5,200
Buildings	65,000
Debtors	6,000
Wages	1,200
	1,94,400		1,94,400

Prepare the trading and profit and loss account for the year ended March 31, 2017 and a balance sheet as on that date.

(a) Unexpired insurance Rs 1,000.

(b) Salary due but not paid Rs 1,800.

(d) Interest on capital 5%.

(e) Scooter is depreciated @ 5%.

(f) Furniture is depreciated Rs @ 10%.

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