Now a days, most of the Competitive Exams, Entrance Exams are conducted on MCQ. Click HERE to understand the Forms, Structure, Rules of MCQ, techniques of understanding, analysing and selection correct answer of MCQ,
Play the Video explaining some interesting aspects of selection of correct answer of MCQ.
For complete resources on Final Accounts Reports, visit https://dvidya.com/final-accounts-mcq/
- When an inflow of economic benefit is probable, contingent asset will be disclosed in
|(a)||In financial statement|
|(b)||In fund flow statement|
|(c)||In cash flow statement|
A contingent asset is usually disclosed in the report of the approving authority (normally board of Directors in the case of a company) It will not be disclosed in the financial statement So, (d) is the correct answer. However, in some cases, it may be shown as note in Financial Statement.
2. Contingent liabilities where no reliable estimate can be made. are shown
|(a)||By way of note to Balance sheet||Contingent Liabilities should be shown as note to financial statements where no reliable estimate can be made. So, option (a) is correct.|
|(b)||In current liability|
|(c)||In non-current liability|
|(d)||In profit and loss A/c|
3. Contingent asset is not recognized in the financial statements on the basis of the accounting concept———-
|(b)||Prudence||On the principle of prudence, contingent asset is not recognized in the financial statements. So, option (b) is correct.|
|(c)||Substance over from|