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Question
Paul is a book seller. He pays for electricity, buys a TV, and pays salary to the salesman. Identify assets or expenses in these transactions.
Paul is a book seller. He pays for electricity, buys a TV, and pays salary to the salesman. Identify assets or expenses in these transactions.
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Solution
The correct option is B TV - Asset
Salary - Expense
Electricity - Expense
TV is an asset because:
a. It is owned by Paul
b. It will give future benefits by entertaining the visitors/customers.
c. It can be expressed in terms of money.
Salary and Electricity are expenses because these are the costs incurred by Paul in the process of earning revenue.
TV - Asset
Salary - Expense
Electricity - Expense
TV is an asset because:
a. It is owned by Paul
b. It will give future benefits by entertaining the visitors/customers.
c. It can be expressed in terms of money.
Salary and Electricity are expenses because these are the costs incurred by Paul in the process of earning revenue.
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