PRC-1 · Chapter 4 · Question 73 of 100
Before finalizing the Statement of Financial Position, adjusting entries are required for: Rent received in advance Rs. 80,000; Unused office supplies Rs. 25,000; Accrued salary Rs. 22,500; Prepaid insurance Rs. 4,800. What is the total addition to Current Liabilities?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) Rs. 102,500
Explanation
Current liabilities consist of the rent received in advance (unearned income) of Rs. 80,000 and the accrued salary of Rs. 22,500. Total = Rs. 102,500.
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