Correct Answer: B. short-term liability

Explanation

The balance c/d on trade creditors will be recorded in the balance sheet as a short-term liability.

Trade creditors represent amounts owed by a business to its suppliers for goods or services that have been purchased on credit. These amounts are typically expected to be paid within a short period, usually within a year. As a result, trade creditors are classified as short-term liabilities on the balance sheet.

In the given information, the trade creditors balance on December 31, 2021, is $6,000. This represents the amount that the business still owes to its suppliers at the end of the year. Since it is an amount payable in the short term, it will be recorded as a short-term liability on the balance sheet.

Correct Answer: D. credit purchase

Explanation

The purchase day book is the book of original entry for recording all of the goods purchased on credit from suppliers. It is sometimes called purchases journal.

Correct Answer: B. profit and loss account

Explanation

Debenture interest is recorded on the debit side of the profit and loss account.

Correct Answer: D. expenses and income

Explanation

Nominal accounts are accounts in which income and expenditure are recorded. It relates to gains, losses, income, expenses e.g discount accounts, sales accounts etc.

Explanation

a.

b.

Abete Trading Company

Trading,Profit and Loss Account for the year ended 31st December, 2020

Correct Answer: C. purchases ledger

Explanation

The purchases ledger contains accounts of creditors i.e it is the book for supplier personal account.

Correct Answer: C. 5,000,000

Explanation

The authorized number of shares refers to the maximum number of shares a company is legally allowed to issue.

According to the information provided, Taurus Ltd was incorporated with the legal right to issue five million ordinary shares.

Therefore, the authorized number of shares for Taurus Ltd is 5,000,000.

Hence, the correct answer is 5,000,000.

Explanation

- Management/Owners

- Investors/Shareholders

- Lenders/Creditors

- Employees/Workers

- Government Agencies/Tax Authorities

Management:

The management or owners of a business are interested in accounting information for various purposes. They rely on financial statements and reports to assess the financial performance of the business, make strategic decisions, evaluate profitability, monitor cash flow, and determine the overall financial health of the company. They need accurate and timely accounting information to effectively manage the business and plan for future.

Investors/Shareholders:

Investors and shareholders are interested in accounting information to evaluate the financial position and performance of a company. They use financial statements and reports to assess the profitability, liquidity, and solvency of the business. This information helps them make investment decisions, evaluate the company's growth potential, and assess the value of their investment.

Lenders/Creditors:

Lenders and creditors, such as banks or suppliers, rely on accounting information to assess the creditworthiness and financial stability of a business. They use financial statements, particularly the balance sheet and cash flow statement, to evaluate the company's ability to repay loans or fulfil its financial obligations. Accurate accounting information helps lenders and creditors determine the level of risk associated with extending credit or lending money.

Employees/Workers:

Employees and workers have an interest in accounting information, especially regarding their compensation and benefits. They rely on accurate accounting records to ensure proper calculation of salaries, wages,bonuses and benefits. Accounting information also helps employees understand the financial health of the company, which may impact job security and potential growth opportunities.

Government Agencies/Workers:

Government agencies and tax authorities require accounting information to ensure compliance with tax regulations, financial reporting standards, and other legal requirements. They use financial statements, tax returns and supporting documentation to assess tax liabilities, enforce regulations ,and monitor financial transparency. Accurate accounting information is crucial for businesses to fulfil their legal obligations and avoid penalties or legal issues.

Correct Answer: D. historical concept

Explanation

Historical concept is also known as Cost concept. This cost implies that the accountant determines the value of an asset by reference to the cost of its acquisition and not by the value of returns which are expected to be earned.

Correct Answer: D. an expenses

Explanation

Expenses are total amount paid or to be paid for resources used in the accounting period e.g wages, electricity, discount allowed, carriage outward etc.