Explain the concept of ‘secret reserve’.
Secret reserve is the amount by which the assets of an organization are understated or its liabilities are overstated. An entity might establish a secret reserve for competitive reasons, to hide from other businesses that it is in a better financial position than appears in its financial statements.
Record the rectification entry for the following transactions:
Credit sales to Rajni 5,000 recorded in Purchases book:
This is an error of ..........................................
State the wrong entry recorded in the book of accounts
Correct effect should have been:
The rectification entry will be:
Cash paid to Neha 2,000 was not posted to her account.
This is an error of ..................................
The wrong effect has been:
The correct effect should have been:
The rectification entry will be.
NCERT questions are designed to test your understanding of the concepts and theories discussed in the chapter. Here are some tips to help you answer NCERT questions effectively:
Welcome to the NCERT Solutions for Class 11 Accountancy - Chapter . This page offers a step-by-step solution to the specific question from Excercise 1 , Question 13: Explain the concept of ‘secret reserve’.....
Comments