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Grouping of Assets & Liabilities

Is outstandin...

Question

Is outstanding rent an asset?

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Solution

Outstanding rent is considered as current liability in accounting. Therefore, it is not an asset.

Also read:

Outstanding Expenses

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Q. Classify the following into Assets, Liabilities, Capital, Revenue, and Expenses:

(i) Plant and Machinery;	(ii) Bank Loan;	(iii) Sales;	(iv) Rent;
(v) Discount Received;	(vi) Carriage Inwards;	(vii) Carriage outwards;	(viii) Purchases;
(ix) Bills Payable;	(x) Wages;	(xi) Advance Income;	(xii) Accrued Income;
(xiii) Goodwill;	(xiv) Furniture and Fixtures;	(xv) Outstanding Expenses;	(xvi) Capital.

Q. On which side will the decrease in the following accounts be recorded? Also, state the nature of the account:

(i) Cash	(ii) Bank Overdraft
(iii) Outstanding Salary paid	(iv) Outstanding Rent
(v) Prepaid Insurance	(vi) Mohan, Proprietor of the business

Q. Calculate Total Assets to Debt Ratio from the following information:


Particulars	₹	Particulars		₹
Total Assets	15,00,000	Bills Payable		60,000
Total Debts	12,00,000	Bank Overdraft		50,000
Creditors	90,000	Outstanding Expenses		20,000

Q. What will be the effect of the following on the Accounting Equation?
(i) Harish started business with cash ₹ 18,000
(ii) Purchased goods for Cash ₹ 5,000 and on credit ₹ 2,000
(iii) Sold goods for cash ₹ 4,000 (costing ₹ 2,400)
(iv) Rent paid ₹ 1,000 and rent outstanding ₹ 200

Q. Prepare Income and Expenditure Account and Balance Sheet for the year ended March 31, 2016 from the following Receipt and Payment Account and Balance Sheet of culture club:

Receipt and Payment Account for the year ending March 31, 2016
Receipts		Amount (Rs)	Payments	Amount (Rs)
Opening cash balance		12,000	Furniture	4,000
Subscription			Telephone expenses	800
2014-15	2,000		Salary
2015-16	22,000	24,000	2014-15	1,000
Entrance fees		2,800	2015-16	4,000
Locker rent		1,000	Newspapers	700
Life membership fee		1,200	Sundry expenses	1,000
Government grant		11,000	Defence bonds	18,000
			Land	20,000
			Closing cash balance	2,500
		52,000		52,000

Balance Sheet for the year ending March 31, 2016
Liabilities	Amount (Rs)	Assets	Amount (Rs)
Advance locker rent	200	Cash in hand	12,000
Subscription received in Advance	1,000	Outstanding subscription	3,000
Outstanding salary	2,000	Building	35,000
Loan	10,000
Capital fund	36,800
	50,000		50,000

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