Accounting MCQ Questions and Solutions with Explanations | Commerce

Goodwill of a company is considered as an intangible asset, hence it falls under fixed assets.

Overdraft is a current liability as it represents the amount owed to a bank.

Preliminary expenses are considered as capitalized expenses and are amortized over a period of time, hence they are part of reserves surplus.

Premium on issue of shares is the amount received by the company over and above the face value of shares issued, it is categorized as fictitious assets.

Correct Answer: Option D: a-2, b-1, c-3, d-4

Here's how to solve this commission problem:

The factory manager gets a commission on the net profit *after* the commission itself is deducted.
This means we can't simply take 10% of Rs. 2200.

Let's say the commission amount is 'C'.
Then the net profit *after* commission is (Rs. 2200 - C).

The commission is 10% of this net profit, so we can write the equation: C = 0.10 * (2200 - C).

Now, let's solve for C:
C = 220 - 0.10C
C + 0.10C = 220
1.10C = 220
C = 220 / 1.10
C = 200

Therefore, the commission will be Rs. 200.

So, the correct answer is Option B: Rs. 200.