1.
Which of the following statements are correct about a “Provision”?
1. Provisions are a charge against the profits of an enterprise.
2. Provisions are created out of divisible profits.
3. Creation of provisions are not necessary for a business.
4. Provisions are created to meet a known liability.
1 out of 10
2.
If the amount of any known liability cannot be determined with accuracy:
2 out of 10
3.
Profit on sale of fixed asset is used to create:
3 out of 10
5.
Reserves arising from capital receipts are known as:
5 out of 10
7.
Which of the following is a correct difference between a provision and reserve?
7 out of 10
8.
Which of the following is a correct distinction between a Revenue reserve and a Capital reserve?
8 out of 10
9.
Which of the following statements is not appropriate in relation to “Provision”?
9 out of 10
