SSC CGL Tier-2 28th January 2022 Assistant Audit Officer

Credit sales during the year can be ascertained as the balancing figure in the total creditor account.

The objective of preparing a statement of affairs is to estimate the balance in the capital account on a particular date.

Credit purchase during the year can be ascertained by preparing the total debtors account.

Statement of affairs is reliable as it is prepared from double entry record.

favourable; overdraft

overdraft; favourable

favourable; favourable

overdraft; overdraft

(Faithful representation)

(Completeness)

(Neutrality)

(Substance over form)

98,070

86,070

12,570

10,570

Trading account is debited with the net purchases and credited with the net sales.

Net purchases is the sum of cash, credit purchase and the amount of return outwards.

Goods received on consignment basis are treated as purchases.

Goods received on sale or return basis are treated as purchases.

Self-balancing ledger system implies a system of ledger keeping which classifies ledgers as per nature of transactions.

In self-balancing system, general ledger adjustment account is prepared in each of the subsidiary ledgers.

In self-balancing system, generally, three ledgers are prepared namely, debtor ledger, credit ledger and main ledger

Under sectional balancing system, if the error affects the total of debtors and creditors accounts, it is rectified by adjusting the accounts of debtors and creditors itself without any additional entries.

Journal properly records transactions like expense accruals, rectification entries, adjusting entries, opening entries and closing entries.

Journal has three functions - analytical, recording and historical.

Journal is divided into two types - General Journal and Special Journal.

Journal is often referred to as the Principal Book of Ent1y.

sorted in order of permanence

sorted in order of priority

sorted in order of liquidity

sorted in order of importance

Only (i)

Both (i) and (ii)

Only (iii)

Only (ii)

(rediscounting)

(endorsement)

(retirement)

(renewal)