Capital And Revenue Transactions Book Back Questions

11th Standard

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Accountancy

Time : 00:45:00 Hrs
Total Marks : 30
    5 x 1 = 5
  1. Amount spent on increasing the seating capacity in a cinema hall is

    (a)

    Capital expenditure

    (b)

    Revenue expenditure

    (c)

    Deferred revenue expenditure

    (d)

    None of the above.

  2. Expenditure incurred Rs.20,000 for trial run of a newly installed machinery will be

    (a)

    Preliminary expense

    (b)

    Revenue expenditure

    (c)

    Capital expenditure

    (d)

    Deferred revenue expenditure

  3. Interest on bank deposits is

    (a)

    Capital receipt

    (b)

    Revenue receipt

    (c)

    Capital expenditures

    (d)

    Revenue expenditures

  4. Revenue expenditure is intended to benefit

    (a)

    Past period

    (b)

    Future period

    (c)

    Current period

    (d)

    Any period

  5. Pre-operative expenses are

    (a)

    Revenue expenditure

    (b)

    Prepaid revenue expenditure

    (c)

    Deferred revenue expenditure

    (d)

    Capital expenditure

  6. 3 x 2 = 6
  7. State with reasons whether the following are capital or revenue expenditure:
    i. Expenses incurred in connection with obtaining a licence for starting the factory for Rs.25,000.
    ii. A factory shed was constructed at a cost of  Rs.2,00,000. A sum of  Rs.10,000 had been incurred in the construction of temporary huts for storing building material.
    iii. Overhaul expenses of second-hand machinery purchased amounted to Rs.5,000.

  8. Classify the following expenses as capital or revenue.
    i) The sum of Rs.3,200 has been spent on a machine as follows:
    a) Rs.2,000 for additions to double the output.
    b) Rs.1,200 for repairs necessitated by negligence.
    ii) Overhauling expenses of Rs.25,000 for the engine of a motor car to get better fuel efficiency.

  9. What is meant by deferred revenue expenditure?

  10. 3 x 3 = 9
  11. Distinguish between capital expenditure and revenue expenditure.

  12. Distinguish between capital receipt and revenue receipt.

  13. What is deferred revenue expenditure? Give two examples.

  14. 2 x 5 = 10
  15. State whether they are capital and revenue.
    i) Construction of building Rs.10,00,000.
    ii) Repairs to furniture Rs.50,000.
    iii) White-washing the building Rs.80,000
    iv) Pulling down the old building and rebuilding Rs.4,00,000

  16. Identify the following items into capital or revenue.
    i) Audit fees paid  Rs.10,000.
    ii) Labour welfare expenses Rs.5,000.
    iii) Rs.2,000 paid for servicing the company vehicle.
    iv) Repair to furniture purchased second hand Rs.3,000.
    v) Rent paid for the factory Rs.12,000

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