The effect of the adjustment entry of managerial commission payable on the asset side of the balance sheet is :

Current assets shall decrease

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Shown as commission receivable

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No effect on the asset side

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Current assets shall increase

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Solution

The correct option is C
No effect on the asset side

The managers commision will be treated as an outstanding expense and it is shown as an expense on the debit side of profit and loss account and also as a current liability in the balance sheet.

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Mr Ram purchased an asset for his business in cash. He is of the view that cash account shall be recorded on the left side, as cash is an asset while asset account should be recorded on the right side as there is an increase in the asset. Which of the following is incorrect in this transaction?

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The effect of the adjustment entry of managerial commission payable on the asset side of the balance sheet is :

The correct option is C No effect on the asset side The managers commision will be treated as an outstanding expense and it is shown as an expense on the debit side of profit and loss account and also as a current liability in the balance sheet.

The correct option is C
No effect on the asset side

The managers commision will be treated as an outstanding expense and it is shown as an expense on the debit side of profit and loss account and also as a current liability in the balance sheet.