Wages paid for installation of machinery, debited to ___________ account.

Capital Reserves

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Reserve Fund

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Secret Reserve

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General Reserve

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Solution

The correct option is D General Reserve
Wagespaid for the installationof Machinery should be debited to the Machinery Account. Such wages should not be debited to the Trading Account because these wages represent capital expenditure. So, it must be added to the cost of machine.and this expenses paid by general reserves -

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Similar questions

Q. Wages paid for installation of machinery debited to wages account. This is _______________.

Q. Wages paid for installation of machinery wrongly debited to wages account is an error of __________.

Q. Select the most appropriate alternative from the alternatives given below and rewrite the statement.

Wages paid for installation of machinery should be debited to ______.
a) Wages A/c
b) Machinery A/c
c) Cash A/c
d) Installation A/c

Rectify the following errors:

(i) Repairs made on Building for Rs 1,00,000 were debited to Building a/c.
(ii) Rent paid Rs 12,000 to Landlord was debited to Landlord a/c.
(iii) Wages paid for installation of Machinery of Rs 7,000 was debited to Wages a/c.
(iv) Salary paid to Accountant (Mr. Ram) on Rs 15,000 was debited to Ram a/c.
(v) Rs 32,000 paid for purchase of Computer was charged to Office Expenses a/c.
(vi) Amount of Rs 7,500 withdrawn by proprietor for personal use was debited to Miscellaneous Expenses a/c.

Wages paid for installation of machinery Rs 7000 was debited to Installation expense account. The rectifying entry to correct the same shall be?

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