Which of the following sets of expenses are the direct expenses of the business?

Salaries, wages and shop rent

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Stationery, postage and telephone

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Wages, carriage inward, local taxes

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Advertisement, legal fees, audit fees

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Solution

The correct option is B Wages, carriage inward, local taxes
Direct expenses can be traced to a specific product, service, customer, or project. These costs are typically easy to assign because you can connect them to a particular project, product, or even department. They are often used to determine the price of your products or services.
Direct expenses are generally variable costs.
Examples include:
direct labor (the cost of paying employees to produce your products)
direct materials, including raw materials
commissions
manufacturing supplies.

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Similar questions

Identify which of the following items will be shown in the Note to Accounts on Other Expenses? (i) Salaries; (ii) Postage Expenses; (iii) Telephone and Internet Expenses; (iv) Rent for warehouse; (v) Carriage Inwards; (vi) Depreciation on computers; (vii) Computer Software amortised; (viii) Computer Hiring Charges; (ix) Audit fee; (x) Bonus.

Out of the following, identify the items to be shown in the Notes to Accounts on 'Other Expenses' :

(i) Rent for factory

(ii) Internet Expenses

(iii) Carriage Inwards

(iv) Salaries

(v) Leave Encashment Exp

(vi) Commission Allowed;

(vii) Bad Debts written off

(viii) Audit fee

(ix) Depreciation on Computers

(x) Computer Software amortized

From the following information, prepare the profit and loss account for the ending on 31st March, 2016

$\begin{matrix} Particulars & Amt (Rs.) & Particulars & Amt (Rs.) Gross profit & 62, 00, 000 & Salaries and wages & 20, 00, 000 Discount received & 1, 00, 000 & Discount allowed & 2, 00, 000 Interest on loan paid & 2, 50, 000 & Interest received & 3, 00, 000 Commission received & 2, 00, 000 & Commission to salesmen & 1, 50, 000 Rent, rates and taxes & 4, 00, 000 & Rent received & 1, 00, 000 Fire insurance premium & 3, 60, 000 & Carriage outwards & 1, 00, 000 Freight outwards & 50, 000 & Repairs and maintenance & 60, 000 Printing and stationery & 60, 000 & Travelling expenses & 1, 60, 000 Entertainment expenses & 1, 20, 000 & Water and electricity & 1, 20, 000 Postage and telegram & 50, 000 & Advertising and publicity & 4, 00, 000 Sales promotion expenses & 40, 000 & Telephone expenses & 1, 00, 000 Bad debts & 1, 00, 000 & Packing expenses & 50, 000 Audit fees & 2, 00, 000 & Bank charges & 40, 000 Depreciation on furniture: & Legal charges & 1, 00, 000 Sales office & 1, 00, 000 & Miscellaneous expenses & 1, 00, 000 Administrative office & 2, 00, 000 & Loss on sale of fixed assets & 50, 000 Miscellaneous incomes & 2, 00, 000 & Loss by theft & 5, 00, 000 Profit on sale of fixed assets & 8, 50, 000 & Dividend received on shares & 30, 000 Loss by fire & 1, 00, 000 & Income from investments & 20, 000 Loss by embezzlement & 1, 00, 000 \end{matrix}$

From the following particulars, prepare Income and Expenditure account:

Details	Amount Rs
Fees collected, including Rs 80,000 on account of the previous year	5,20,000
Fees for the year outstanding	30,000
Salary paid , including Rs 5,000 on account of the previous year	68,000
Salary outstanding at the end of the year	3,000
Entertainment expenses	8,000
Tournament expenses	25,000
Meeting Expenses	18,000
Traveling Expenses	7,000
Purchase of Books and Periodicals, including Rs 31,000 for purchase of Books	40,000
Rent	15,000
Postage, telegrams and telephones	6,000
Printing and Stationery	18,000
Donations received	25,000

From the following particulars, prepare Income and Expenditure account:

Details	Amount Rs
Fees collected, including Rs 80,000 on account of the previous year	5,20,000
Fees for the year outstanding	30,000
Salary paid, including Rs 5,000 on account of the previous year	68,000
Salary outstanding at the end of the year	3,000
Entertainment expenses	8,000
Tournament expenses	25,000
Meeting Expenses	18,000
Traveling Expenses	7,000
Purchase of Books and Periodicals, including Rs 31,000 for purchase of Books	40,000
Rent	15,000
Postage, telegrams and telephones	6,000
Printing and Stationery	18,000
Donations received	25,000

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