CMA Intermediate · Financial Accounting · Accounting Fundamentals
Sunil Brothers, a sole proprietorship, received Rs 18,000 as rent during the year, which includes Rs 3,000 received in advance for April 2026. Rent of Rs 2,000 for February and March 2026 is still receivable. What is the rent income to be credited to the Profit and Loss Account for the year ended 31 March 2026?
Rent income is Rs 17,000. Of the Rs 18,000 received, Rs 3,000 relates to April 2026 and is deducted as income received in advance. The Rs 2,000 accrued for February and March is added as income receivable, giving Rs 15,000 plus Rs 2,000, which is Rs 17,000.
- ARs 17,000Correct
- BRs 15,000
- CRs 18,000
- DRs 20,000
Explanation
Cash received 18,000. Deduct advance for next year 3,000: 15,000. Add rent accrued but not received 2,000: 17,000. Rs 20,000 would wrongly add the advance instead of deducting it.
Did you get it right without looking?
One question tells you little. A timed set on Accounting Fundamentals shows your real accuracy, how long you take and where you lose marks.
More Accounting Fundamentals questions
- Under the ICAI framework for accounting standards in India, which of the following is the correct statement about Ind AS and the Accounting …
- Vikram Industries follows the accrual basis. In March 2026 it sold goods worth Rs 5,00,000 on credit, delivered on 28 March 2026, and receiv…
- Patel Engineering bought a machine on 1 April 2024 for Rs 4,00,000 and charges depreciation at 20% per annum on the written down value metho…
- Gupta Traders values closing stock at cost Rs 60,000, whereas its net realisable value is Rs 52,000. Under the convention of conservatism an…
- Iyer Stores purchased a computer for Rs 45,000 and immediately charged it fully to Repairs Expense, as it considered the amount small. The p…
- Singh Industries had machinery costing Rs 6,00,000 purchased on 1 April 2023, depreciated at 10% p.a. on the straight line method on origina…