Question : Issue of shares at a premium is :
Option 1: Profit
Option 2: Revenue Receipt
Option 3: Capital Receipt
Option 4: Income
Correct Answer: Capital Receipt
Solution : Capital receipts are non-recurring receipts that cause an increase in liabilities or a loss in assets. The business is exposed since the premium amount is not consistently received. It is, therefore, a capital receipt.
Hence the correct answer is option 3.
Question : ______________is transferred of the Capital Reserve.
Option 1: Profit from sale of fixed assets
Option 2: Premium on issue of shares
Option 3: Profit on forfeiture of shares
Option 4: All of the above
Question : Endowment fund received by NPO is:
Option 1: Capital Expenditure
Option 2: Revenue Expenditure
Option 3: Revenue Receipt
Option 4: Capital Receipt
Question : Subscription received by a club for cricket match is treated as:
Option 1: Revenue Receipt
Option 2: Asset
Option 3: Earned Income
Question : Which of the following is not a capital profit?
Option 1: Profit prior to incorporation of the company
Option 2: Profit from the sale of fixed Assets
Option 3: Premium on issue of shares
Option 4: Compensation received on the termination of the contract
Regular exam updates, QnA, Predictors, College Applications & E-books now on your Mobile