Payment of expenses will ______ the assets

Which of the following assets is/are to be valued at the lower of cost and net realizable value?

A. Goodwill
B. Inventories
C. Investments
D. Both B. and C. above.

Inventories B. are to be valued at the lower of cost and net realizable value. All the other assets stated in other alternatives are valued as per the cost concept. Goodwill A. is a fixed intangible asset and is shown at the cost of its acquisition. Investments C. are valued at cost or market value whichever is less. The combination of B. and C. is incorrect because a correct answer with incorrect answer is an incorrect answer. Thus, the correct answer is B

Purchase journal is kept to record_____________?

A. All purchases of goods
B. All credit purchases of goods
C. All credit purchases
D. None of these

A. Trade mark
B. Franchise
C. Accounts Receivable
D. Secret Profit
An accounts receivable is not an intangible asset. It is the amount that the business has to receive from its debtors. The other assets mentioned in alternatives a, b, and d- trademark, franchises and secret processes are intangible assets. Hence, the correct answer is C.

At the time of preparation of financial accounts, bad debt recovered account will be transferred to?

A. Debtors A/c
B. Profit & Loss A/c
C. Profit & Loss Adjustment A/c
D. Profit & Loss Appropriation A/c

Bad debt recovered is a windfall gain and it is transferred to Profit & Loss Account at the time of preparation of Final Accounts. If provisions account is there in the books it will be transferred to Provision A/c and the balance if any in the provision account will be transferred to Profit & Loss Account. It is recovery of bad debt written off and hence it is not transferred to Debtors Account. It is not transferred to Profit & Loss Adjustment Account. It is not an appropriation to be transferred to Profit & Loss Appropriation Account. Thus, the answer is B

A. Variable cost
B. Unit cost
C. Total cost
D. Fixed cost