Financial Statements – II · Class 11 · CBSE · Commerce Accountancy
Which of the following items is treated as an Operating Expense in the preparation of the Profit and Loss Account?
Practice question from Financial Statements – II (Class 11 · CBSE · Commerce Accountancy), with the correct answer and a step-by-step solution.
easy · MCQ · Q-F541E8
Which of the following items is treated as an Operating Expense in the preparation of the Profit and Loss Account?
- A.Loss on sale of machinery
- B.Interest paid on bank loan
- C.Office rent paidCorrect answer
- D.Preliminary expenses written off
Solution
Office rent paid is a regular operating expense incurred for the administration of the business. Loss on sale of machinery, interest paid, and preliminary expenses are non-operating items or financial expenses.
More from Financial Statements – II
- What is the accounting treatment of Closing Stock when it is given inside the Trial Balance?
- Unearned income (Income received in advance) at the end of the accounting period is:
- Manager's commission is generally calculated as a percentage of net profit. If the commission is calculated on net profit after charging su…
- Which of the following errors will be disclosed by the preparation of a Trial Balance, but affects the final accounts if not rectified?
Practise more Accountancy
Sign up free for adaptive practice on this chapter, with instant feedback and hints on every question.
Start practising freeFree to start · No credit card needed