FINANCIAL ACCOUNTING – 1 (MGT101) assignment no 1 solution April Spring 2011

[Xpert]

Question No. 2
From the following transactions, identify the nature of expenditure whether Capital Expenditure or Revenue
Expenditure by filling up the appropriate boxes given below.

S. No..... Transactions ...........Nature of expenditure
1......... Merchandise purchase for cash is........ Revenue Expenditure
2 Paid rent of the building is........................... Capital Expenditure
3 Commission paid to the workers is .............Revenue Expenditure
4 Cost of acquiring the patent rights is .............Revenue Expenditure
5 Installation cost of the machinery is............ Capital Expenditure

Question No. 3
a) Briefly describe the difference between Tangible and Intangible Assets.
b) Write down the type of Asset (Tangible / Intangible) in
the appropriate boxes given below.
S. No. Transactions Type of Asset
1 Raw Material / Stores is Tangible Asset
2The Technology of information and database is Intangible Asset
3 Abilities and innovations of the employers is Intangible Asset
4 The money – Cash at Bank is Tangible Asset