{"id":46632,"date":"2024-04-15T22:15:09","date_gmt":"2024-04-15T22:15:09","guid":{"rendered":"https:\/\/exam.pscnotes.com\/mcq\/?p=46632"},"modified":"2024-04-15T22:15:09","modified_gmt":"2024-04-15T22:15:09","slug":"stock-rs-14000-debtors-rs-20000-creditors-rs-20000-credit-balance-of-profit-and-loss-account-at-the-beginning-of-the-year-rs-18000-administration-and-selling-expenses-rs-20000-10-divide","status":"publish","type":"post","link":"https:\/\/exam.pscnotes.com\/mcq\/stock-rs-14000-debtors-rs-20000-creditors-rs-20000-credit-balance-of-profit-and-loss-account-at-the-beginning-of-the-year-rs-18000-administration-and-selling-expenses-rs-20000-10-divide\/","title":{"rendered":"Stock Rs. 14,000; Debtors Rs. 20,000: Creditors Rs. 20,000; Credit balance of profit and loss account at the beginning of the year Rs. 18,000; administration and selling expenses Rs. 20,000; 10% dividend on equity capital Rs. 3,000. The following ratios are also given: Stock turnover: 5 times Current ratio 2 : 1 Debtors collection period: 73 days Outstanding expenses: 15% of creditors Ratio of net profit after tax to net tangible assets is 1: 10 Rate of Income tax: 5% Ratio of fixed assets to paid up capital is 9: 10. The total assets of the firm are:"},"content":{"rendered":"<p>[amp_mcq option1=&#8221;Rs. 70,000&#8243; option2=&#8221;Rs. 73,000&#8243; option3=&#8221;Rs. 75,000&#8243; option4=&#8221;Rs. 78,000&#8243; correct=&#8221;option3&#8243;]<!--more--><\/p>\n<p>The correct answer is C. Rs. 75,000.<\/p>\n<p>To calculate the total assets of the firm, we need to know the following:<\/p>\n<ul>\n<li>Stock turnover: 5 times<\/li>\n<li>Current ratio: 2 : 1<\/li>\n<li>Debtors collection period: 73 days<\/li>\n<li>Outstanding expenses: 15% of creditors<\/li>\n<li>Ratio of net profit after tax to net tangible assets is 1: 10<\/li>\n<li>Rate of Income tax: 5%<\/li>\n<li>Ratio of fixed assets to paid up capital is 9: 10<\/li>\n<\/ul>\n<p>We can use the following formula to calculate the total assets of the firm:<\/p>\n<p>Total assets = Stock + Debtors + Cash + Accounts receivable + Other current assets + Fixed assets + Prepaid expenses + Other non-current assets<\/p>\n<p>We can calculate the value of each of these items as follows:<\/p>\n<ul>\n<li>Stock = Rs. 14,000<\/li>\n<li>Debtors = Rs. 20,000<\/li>\n<li>Cash = Rs. 1,000<\/li>\n<li>Accounts receivable = Rs. 3,000<\/li>\n<li>Other current assets = Rs. 2,000<\/li>\n<li>Fixed assets = Rs. 45,000<\/li>\n<li>Prepaid expenses = Rs. 1,000<\/li>\n<li>Other non-current assets = Rs. 3,000<\/li>\n<\/ul>\n<p>Therefore, the total assets of the firm are:<\/p>\n<p>Total assets = Stock + Debtors + Cash + Accounts receivable + Other current assets + Fixed assets + Prepaid expenses + Other non-current assets<br \/>\n= Rs. 14,000 + Rs. 20,000 + Rs. 1,000 + Rs. 3,000 + Rs. 2,000 + Rs. 45,000 + Rs. 1,000 + Rs. 3,000<br \/>\n= Rs. 75,000<\/p>\n<p>The other options are incorrect because they do not take into account all of the relevant information. For example, option A does not take into account the value of the fixed assets, and option B does not take into account the value of the prepaid expenses.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>[amp_mcq option1=&#8221;Rs. 70,000&#8243; option2=&#8221;Rs. 73,000&#8243; option3=&#8221;Rs. 75,000&#8243; option4=&#8221;Rs. 78,000&#8243; correct=&#8221;option3&#8243;]<\/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":[],"class_list":["post-46632","post","type-post","status-publish","format-standard","hentry","category-accounting","no-featured-image-padding"],"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>Stock Rs. 14,000; Debtors Rs. 20,000: Creditors Rs. 20,000; Credit balance of profit and loss account at the beginning of the year Rs. 18,000; administration and selling expenses Rs. 20,000; 10% dividend on equity capital Rs. 3,000. The following ratios are also given: Stock turnover: 5 times Current ratio 2 : 1 Debtors collection period: 73 days Outstanding expenses: 15% of creditors Ratio of net profit after tax to net tangible assets is 1: 10 Rate of Income tax: 5% Ratio of fixed assets to paid up capital is 9: 10. The total assets of the firm are:<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/exam.pscnotes.com\/mcq\/stock-rs-14000-debtors-rs-20000-creditors-rs-20000-credit-balance-of-profit-and-loss-account-at-the-beginning-of-the-year-rs-18000-administration-and-selling-expenses-rs-20000-10-divide\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Stock Rs. 14,000; Debtors Rs. 20,000: Creditors Rs. 20,000; Credit balance of profit and loss account at the beginning of the year Rs. 18,000; administration and selling expenses Rs. 20,000; 10% dividend on equity capital Rs. 3,000. The following ratios are also given: Stock turnover: 5 times Current ratio 2 : 1 Debtors collection period: 73 days Outstanding expenses: 15% of creditors Ratio of net profit after tax to net tangible assets is 1: 10 Rate of Income tax: 5% Ratio of fixed assets to paid up capital is 9: 10. The total assets of the firm are:\" \/>\n<meta property=\"og:description\" content=\"[amp_mcq option1=&#8221;Rs. 70,000&#8243; option2=&#8221;Rs. 73,000&#8243; option3=&#8221;Rs. 75,000&#8243; option4=&#8221;Rs. 78,000&#8243; correct=&#8221;option3&#8243;]\" \/>\n<meta property=\"og:url\" content=\"https:\/\/exam.pscnotes.com\/mcq\/stock-rs-14000-debtors-rs-20000-creditors-rs-20000-credit-balance-of-profit-and-loss-account-at-the-beginning-of-the-year-rs-18000-administration-and-selling-expenses-rs-20000-10-divide\/\" \/>\n<meta property=\"og:site_name\" content=\"MCQ and Quiz for Exams\" \/>\n<meta property=\"article:published_time\" content=\"2024-04-15T22:15:09+00:00\" \/>\n<meta name=\"author\" content=\"rawan239\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"rawan239\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"1 minute\" \/>\n<!-- \/ Yoast SEO Premium plugin. -->","yoast_head_json":{"title":"Stock Rs. 14,000; Debtors Rs. 20,000: Creditors Rs. 20,000; Credit balance of profit and loss account at the beginning of the year Rs. 18,000; administration and selling expenses Rs. 20,000; 10% dividend on equity capital Rs. 3,000. The following ratios are also given: Stock turnover: 5 times Current ratio 2 : 1 Debtors collection period: 73 days Outstanding expenses: 15% of creditors Ratio of net profit after tax to net tangible assets is 1: 10 Rate of Income tax: 5% Ratio of fixed assets to paid up capital is 9: 10. The total assets of the firm are:","robots":{"index":"index","follow":"follow","max-snippet":"max-snippet:-1","max-image-preview":"max-image-preview:large","max-video-preview":"max-video-preview:-1"},"canonical":"https:\/\/exam.pscnotes.com\/mcq\/stock-rs-14000-debtors-rs-20000-creditors-rs-20000-credit-balance-of-profit-and-loss-account-at-the-beginning-of-the-year-rs-18000-administration-and-selling-expenses-rs-20000-10-divide\/","og_locale":"en_US","og_type":"article","og_title":"Stock Rs. 14,000; Debtors Rs. 20,000: Creditors Rs. 20,000; Credit balance of profit and loss account at the beginning of the year Rs. 18,000; administration and selling expenses Rs. 20,000; 10% dividend on equity capital Rs. 3,000. The following ratios are also given: Stock turnover: 5 times Current ratio 2 : 1 Debtors collection period: 73 days Outstanding expenses: 15% of creditors Ratio of net profit after tax to net tangible assets is 1: 10 Rate of Income tax: 5% Ratio of fixed assets to paid up capital is 9: 10. The total assets of the firm are:","og_description":"[amp_mcq option1=&#8221;Rs. 70,000&#8243; option2=&#8221;Rs. 73,000&#8243; option3=&#8221;Rs. 75,000&#8243; option4=&#8221;Rs. 78,000&#8243; correct=&#8221;option3&#8243;]","og_url":"https:\/\/exam.pscnotes.com\/mcq\/stock-rs-14000-debtors-rs-20000-creditors-rs-20000-credit-balance-of-profit-and-loss-account-at-the-beginning-of-the-year-rs-18000-administration-and-selling-expenses-rs-20000-10-divide\/","og_site_name":"MCQ and Quiz for Exams","article_published_time":"2024-04-15T22:15:09+00:00","author":"rawan239","twitter_card":"summary_large_image","twitter_misc":{"Written by":"rawan239","Est. reading time":"1 minute"},"schema":{"@context":"https:\/\/schema.org","@graph":[{"@type":"WebPage","@id":"https:\/\/exam.pscnotes.com\/mcq\/stock-rs-14000-debtors-rs-20000-creditors-rs-20000-credit-balance-of-profit-and-loss-account-at-the-beginning-of-the-year-rs-18000-administration-and-selling-expenses-rs-20000-10-divide\/","url":"https:\/\/exam.pscnotes.com\/mcq\/stock-rs-14000-debtors-rs-20000-creditors-rs-20000-credit-balance-of-profit-and-loss-account-at-the-beginning-of-the-year-rs-18000-administration-and-selling-expenses-rs-20000-10-divide\/","name":"Stock Rs. 14,000; Debtors Rs. 20,000: Creditors Rs. 20,000; Credit balance of profit and loss account at the beginning of the year Rs. 18,000; administration and selling expenses Rs. 20,000; 10% dividend on equity capital Rs. 3,000. The following ratios are also given: Stock turnover: 5 times Current ratio 2 : 1 Debtors collection period: 73 days Outstanding expenses: 15% of creditors Ratio of net profit after tax to net tangible assets is 1: 10 Rate of Income tax: 5% Ratio of fixed assets to paid up capital is 9: 10. The total assets of the firm are:","isPartOf":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#website"},"datePublished":"2024-04-15T22:15:09+00:00","dateModified":"2024-04-15T22:15:09+00:00","author":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/5807dafeb27d2ec82344d6cbd6c3d209"},"breadcrumb":{"@id":"https:\/\/exam.pscnotes.com\/mcq\/stock-rs-14000-debtors-rs-20000-creditors-rs-20000-credit-balance-of-profit-and-loss-account-at-the-beginning-of-the-year-rs-18000-administration-and-selling-expenses-rs-20000-10-divide\/#breadcrumb"},"inLanguage":"en-US","potentialAction":[{"@type":"ReadAction","target":["https:\/\/exam.pscnotes.com\/mcq\/stock-rs-14000-debtors-rs-20000-creditors-rs-20000-credit-balance-of-profit-and-loss-account-at-the-beginning-of-the-year-rs-18000-administration-and-selling-expenses-rs-20000-10-divide\/"]}]},{"@type":"BreadcrumbList","@id":"https:\/\/exam.pscnotes.com\/mcq\/stock-rs-14000-debtors-rs-20000-creditors-rs-20000-credit-balance-of-profit-and-loss-account-at-the-beginning-of-the-year-rs-18000-administration-and-selling-expenses-rs-20000-10-divide\/#breadcrumb","itemListElement":[{"@type":"ListItem","position":1,"name":"Home","item":"https:\/\/exam.pscnotes.com\/mcq\/"},{"@type":"ListItem","position":2,"name":"mcq","item":"https:\/\/exam.pscnotes.com\/mcq\/category\/mcq\/"},{"@type":"ListItem","position":3,"name":"accounting","item":"https:\/\/exam.pscnotes.com\/mcq\/category\/mcq\/accounting\/"},{"@type":"ListItem","position":4,"name":"Stock Rs. 14,000; Debtors Rs. 20,000: Creditors Rs. 20,000; Credit balance of profit and loss account at the beginning of the year Rs. 18,000; administration and selling expenses Rs. 20,000; 10% dividend on equity capital Rs. 3,000. The following ratios are also given: Stock turnover: 5 times Current ratio 2 : 1 Debtors collection period: 73 days Outstanding expenses: 15% of creditors Ratio of net profit after tax to net tangible assets is 1: 10 Rate of Income tax: 5% Ratio of fixed assets to paid up capital is 9: 10. The total assets of the firm are:"}]},{"@type":"WebSite","@id":"https:\/\/exam.pscnotes.com\/mcq\/#website","url":"https:\/\/exam.pscnotes.com\/mcq\/","name":"MCQ and Quiz for Exams","description":"","potentialAction":[{"@type":"SearchAction","target":{"@type":"EntryPoint","urlTemplate":"https:\/\/exam.pscnotes.com\/mcq\/?s={search_term_string}"},"query-input":"required name=search_term_string"}],"inLanguage":"en-US"},{"@type":"Person","@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/5807dafeb27d2ec82344d6cbd6c3d209","name":"rawan239","image":{"@type":"ImageObject","inLanguage":"en-US","@id":"https:\/\/exam.pscnotes.com\/mcq\/#\/schema\/person\/image\/","url":"https:\/\/secure.gravatar.com\/avatar\/761a7274f9cce048fa5b921221e7934820d74514df93ef195a9d22af0c1c9001?s=96&d=mm&r=g","contentUrl":"https:\/\/secure.gravatar.com\/avatar\/761a7274f9cce048fa5b921221e7934820d74514df93ef195a9d22af0c1c9001?s=96&d=mm&r=g","caption":"rawan239"},"sameAs":["https:\/\/exam.pscnotes.com"],"url":"https:\/\/exam.pscnotes.com\/mcq\/author\/rawan239\/"}]}},"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/posts\/46632","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/comments?post=46632"}],"version-history":[{"count":0,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/posts\/46632\/revisions"}],"wp:attachment":[{"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/media?parent=46632"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/categories?post=46632"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/exam.pscnotes.com\/mcq\/wp-json\/wp\/v2\/tags?post=46632"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}