Which accounting principle mandates that a business will continue its operations indefinitely? MCQ with Answer and Explanation
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Question #1
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S1: Break-even point is the level of sales where total revenue equals total costs. S2: At the break-even point, the contribution equals fixed costs. Which statement(s) is/are correct?
Correct Answer: Option B
Explanation:
The break-even point is where Total Revenue = Total Costs (Fixed + Variable), resulting in zero profit. At this point, Contribution (Sales - Variable Costs) exactly equals Fixed Costs. Both statements are correct.
The break-even point is where Total Revenue = Total Costs (Fixed + Variable), resulting in zero profit. At this point, Contribution (Sales - Variable Costs) exactly equals Fixed Costs. Both statements are correct.
This question belongs to:
Accountancy and Statistics
Accountancy and Book Keeping
Question #2
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The 'Section 80EEB' deduction is for:
Correct Answer: Option B
Explanation:
Section 80EEB provides deduction up to ₹1,50,000 on interest paid on loan for purchase of electric vehicle.
Section 80EEB provides deduction up to ₹1,50,000 on interest paid on loan for purchase of electric vehicle.
This question belongs to:
Accountancy and Statistics
Accountancy and Book Keeping
Question #3
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Which of the following is not a type of error?
Correct Answer: Option B
Explanation:
Common errors in accounting are error of principle, omission, commission, and compensating error. Error of interpretation is not a standard classification.
Common errors in accounting are error of principle, omission, commission, and compensating error. Error of interpretation is not a standard classification.
This question belongs to:
Accountancy and Statistics
Accountancy and Book Keeping
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