Question

Choice Questions (MCQs))
the correct alternative:
1) Capital is
(a) internal liability,
(6) external liability
(c) internal as well as external liability. (d) None of these.
:) Goods taken by the proprietor for personal use is
(a) Sale.
(6) Drawings.
(c) Purchase.
(d) None of these
) Amount received or receivable against sale of goods is
(a) revenue receipt.
(b) capital receipt.
(c) sometimes revenue receipt and sometimes capital receipt.
(d) None of these.​

Answer 1

Answer:

1. a) Internal Liability.

2. b) Drawings.

3. c) Revenue Receipt

Answer 2

1) (A) internal liability

2) (B) Drawings

3) (C) Revenue receipts

Explanation:

• Capital is an internal liability.
• Capital refers to assets and the cash in the business. It is therefore an internal liability of the proprietor.
• Goods taken up by the proprietor for their personal use are known as Drawings.
• At times the owner of the company needs cash for his/her personal use. Therefore, he/she draws out cash in the form of drawings.
• The amount received or receivables against the sales of goods are known as revenue receipts.