Question

Subscription to newspaper and periodicals Rs.350. Sale proceeds of old newspapers Rs.60. What amount is posted on the expenditure side of the Income and Expenditure account?

• A. Rs. 350
• B. Rs. 290
• C. Rs. 410
• D. Rs. 60

Answer 1

Answer: (A)

Rs. 350

Income and Expenditure account is prepared on accrual basis with the help of receipts and payments account along with additional information. All the revenue items relating to the current to the current period are shown in Income and Expenditure account, the expenses are shown on expenditure side and income on income side.

In the given question the expense related to subscription to newspaper and periodicals Rs. 350 is posted to expenditure side of Income and Expenditure account.