Question

During the year, Z had cash sales of Rs. 1,95,000 and credit sales of Rs. 80,000. His expenses for the year were Rs 1,35,000 out of which 40,000 are still to be paid. Find out
Z's income following accrual basis of accounting.

(a) Rs 100000
(b) Rs 180000
(c) Rs 140000
(d) Rs 130000
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Answer 1

Answer:

195000+80000-135000=140000

Answer 2

Accrual basis of accounting is a system of accounting where the incomes and expenditures are recored on their occurrence irrespective of the time when they are received or paid

Answer:

therefore total sales= 195000+80000=Rs.275000

total expenditure = Rs. 135000

therefore

income= sales - expenses

= 275000-135000

=Rs.140000(c)

Hope it helps