Question

A state whether the following statements are True or False with reasons. Q.4 1) Outstanding expense is nominal account. F 2) Capital account is a real account 3) Every debit has equal and corresponding credit. 1 4) Discount received is a nominal account. 1 5) Drawings account is a nominal account. 6) Outstanding salary is a nominal account.f 7) Loan account is personal account. 7 8) Goodwill account is a real account. 7 9) Trade discount account is a nominal account. 10) Personal transactions of proprietor are recorded in the books of account of business. 11) Motor car account is a Real Account. 1 12) The rule of Nominal Account in Debit the receiver and Credit the giver. 13) Bank loan account is a Nominal account. F 14) Assets = Capital + Liabilities T 15) Trademark account is a personal account​

Answer 1

Answer:

1) Outstanding expense is nominal account.- False.

Reason: Outstanding expense is Personal A/c

2) Capital account is a real account. – False.

Reason: Capital account is a Personal account.

3) Every debit has equal and corresponding credit.- True.

Reason: Every Transaction has two effect.

4) Discount received is a nominal account.- True.

Reason: Discount Received is a gain earned by the business at the time of Purchase. Hence it is a nominal A/c.

5) Drawings account is a nominal account.- False.

Reason : Drawing account is a Personal account.

6) Outstanding salary is a nominal account.- False.

Reason: Outstanding salary is a Personal A/c.

7) Loan account is personal account.- True

Reason: Loan account is related to Individual human being. Thus it is a personal account.

8) Goodwill account is a real account.- True.

Ans: Goodwill is an intangible asset, Hence it is Real account.

9) Trade discount account is a nominal account.- True.

Reason: Trade discount account is a nominal account

10) Personal transactions of proprietor are recorded in the books of account of business.- False.

Reason: Only Business transactions are recorded in the books of account.

11) Motor car account is a Real Account.- True

Reason: Motor car is a tangible Asset, Hence it is Real A/c.

12) The rule of Nominal Account in Debit the receiver and Credit the giver.- False.

Reason: The rule of Nominal Account is:

Debit all Expenses and Losses

Credit All Income and Gains.

13) Bank loan account is a Nominal account.- False

Reason: Bank loan is Personal Account.

14) Assets = Capital + Liabilities – True

Reason: Accounting equation signifies that assets of a business are always equal to the total of its Liabilities and Capital.

15) Trademark account is a personal account.- False.

Reason: Trademark is a Real A/c.

Explanation:

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