{"id":45176,"date":"2024-04-15T21:54:18","date_gmt":"2024-04-15T21:54:18","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=45176"},"modified":"2024-04-15T21:54:18","modified_gmt":"2024-04-15T21:54:18","slug":"on-28th-march-2019-stock-worth-rs-10000-was-lost-by-fire-the-insurance-company-admitted-full-claim-on-31st-march-2019-while-preparing-final-accounts-it-will-be-shown","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/on-28th-march-2019-stock-worth-rs-10000-was-lost-by-fire-the-insurance-company-admitted-full-claim-on-31st-march-2019-while-preparing-final-accounts-it-will-be-shown\/","title":{"rendered":"On 28th March, 2019 stock worth Rs. 10,000 was lost by fire. The insurance company admitted full claim. On 31st March. 2019 while preparing Final Accounts, it will be shown"},"content":{"rendered":"<p>\r\n    <!-- Check if it's an AMP page -->\r\n            <!-- Non-AMP version -->\r\n        <div class=\"mcq-container\" data-quiz-id=\"quizState_6a97d97b975e2\">\r\n                                            <div class=\"option\" data-option-key=\"option1\" data-is-correct=\"false\">\r\n                    Only in Trading Account                <\/div>\r\n                                            <div class=\"option\" data-option-key=\"option2\" data-is-correct=\"false\">\r\n                    Only in Profit and Loss Account                <\/div>\r\n                                            <div class=\"option\" data-option-key=\"option3\" data-is-correct=\"true\">\r\n                    Both in Trading and Profit and Loss Account                <\/div>\r\n                                            <div class=\"option\" data-option-key=\"option4\" data-is-correct=\"false\">\r\n                    Both in Trading Account and Balance Sheet                <\/div>\r\n                            \r\n            <!-- Feedback messages for non-AMP -->\r\n            <div class=\"feedback\" data-feedback=\"wrong\">Answer is Right!<\/div>\r\n            <div class=\"feedback\" data-feedback=\"right\">Answer is Wrong!<\/div>\r\n        <\/div>\r\n\r\n        <script>\r\n        document.addEventListener('DOMContentLoaded', function () {\r\n            var containers = document.querySelectorAll('.mcq-container');\r\n\r\n            containers.forEach(function(container) {\r\n                var options = container.querySelectorAll('.option');\r\n                var feedbackSelect = container.querySelector('[data-feedback=\"select\"]');\r\n                var feedbackWrong = container.querySelector('[data-feedback=\"wrong\"]');\r\n                var feedbackRight = container.querySelector('[data-feedback=\"right\"]');\r\n\r\n                options.forEach(function(option) {\r\n                    option.addEventListener('click', function() {\r\n                        var selectedOption = option.getAttribute('data-option-key');\r\n                        var isCorrect = option.getAttribute('data-is-correct') === 'true';\r\n\r\n                        \/\/ Remove previous selections\r\n                        options.forEach(function(opt) {\r\n                            opt.classList.remove('correct', 'incorrect');\r\n                        });\r\n\r\n                        \/\/ Add the correct\/incorrect class\r\n                        if (isCorrect) {\r\n                            option.classList.add('correct');\r\n                            feedbackRight.hidden = false;\r\n                            feedbackWrong.hidden = true;\r\n                        } else {\r\n                            option.classList.add('incorrect');\r\n                            feedbackRight.hidden = true;\r\n                            feedbackWrong.hidden = false;\r\n                        }\r\n\r\n                        \/\/ Hide select feedback\r\n                        feedbackSelect.hidden = true;\r\n                    });\r\n                });\r\n            });\r\n        });\r\n        <\/script>\r\n    \r\n    <!--more--><\/p>\n<p>The correct answer is: <strong>C. Both in Trading and Profit and Loss Account<\/strong><\/p>\n<p>The loss of stock due to fire is an expense that should be deducted from the gross profit to arrive at the net profit. The insurance claim received should be credited to the profit and loss account as it reduces the net loss.<\/p>\n<p>The loss of stock will also be shown in the trading account as a deduction from the cost of goods sold. This is because the stock that was lost is no longer available for sale.<\/p>\n<p>The following is a detailed explanation of each option:<\/p>\n<ul>\n<li><strong>Option A: Only in Trading Account<\/strong><\/li>\n<\/ul>\n<p>This option is incorrect because the loss of stock due to fire is also an expense that should be deducted from the gross profit to arrive at the net profit.<\/p>\n<ul>\n<li><strong>Option B: Only in Profit and Loss Account<\/strong><\/li>\n<\/ul>\n<p>This option is incorrect <div class=\"telegram-channel-container\">\r\n        <a href=\"https:\/\/t.me\/pscnotes2025\" target=\"_blank\" class=\"telegram-channel-button\">\r\n            <span class=\"telegram-icon\">\r\n                <svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 496 512\">\r\n                    <path fill=\"white\" d=\"M248,8C111,8,0,119,0,256s111,248,248,248s248-111,248-248S385,8,248,8z M362,177L320,367c-3,14-10,18-20,14l-56-41l-27,26 c-3,3-5,5-10,5l4-63L323,196c5-5-1-7-8-3l-98,62l-42-13c-9-3-10-9,2-14l162-63C351,160,365,164,362,177z\"\/>\r\n                <\/svg>\r\n            <\/span>\r\n            Join Our Telegram Channel\r\n        <\/a>\r\n    <\/div> because the loss of stock due to fire is also a deduction from the cost of goods sold in the trading account.<\/p>\n<ul>\n<li><strong>Option C: Both in Trading and Profit and Loss Account<\/strong><\/li>\n<\/ul>\n<p>This option is correct because the loss of stock due to fire is both an expense that should be deducted from the <div class=\"youtube-subscribe-container\">\r\n        <a href=\"https:\/\/www.youtube.com\/channel\/UCNHT8lW-JmLC68rjBfZhdkg?sub_confirmation=1\" target=\"_blank\" class=\"youtube-subscribe-button\">\r\n            <span class=\"youtube-icon\">\r\n                <svg xmlns=\"http:\/\/www.w3.org\/2000\/svg\" viewBox=\"0 0 576 512\">\r\n                    <path d=\"M549.7 124.1c-6.3-23.7-24.8-42.3-48.3-48.6C458.8 64 288 64 288 64S117.2 64 74.6 75.5c-23.5 6.3-42 24.9-48.3 48.6-11.4 42.9-11.4 132.3-11.4 132.3s0 89.4 11.4 132.3c6.3 23.7 24.8 41.5 48.3 47.8C117.2 448 288 448 288 448s170.8 0 213.4-11.5c23.5-6.3 42-24.2 48.3-47.8 11.4-42.9 11.4-132.3 11.4-132.3s0-89.4-11.4-132.3zm-317.5 213.5V175.2l142.7 81.2-142.7 81.2z\"\/>\r\n                <\/svg>\r\n            <\/span>\r\n            Subscribe on YouTube\r\n        <\/a>\r\n    <\/div> gross profit to arrive at the net profit, and a deduction from the cost of goods sold in the trading account.<\/p>\n<ul>\n<li><strong>Option D: Both in Trading Account and Balance Sheet<\/strong><\/li>\n<\/ul>\n<p>This option is incorrect because the loss of stock due to fire is not an asset that should be shown in the balance sheet.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Join Our Telegram Channel Subscribe on YouTube<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[85],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v22.2 (Yoast SEO v23.3) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>On 28th March, 2019 stock worth Rs. 10,000 was lost by fire. 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