Which of the following are NOT correct about "Sinking Fund"?
(A) It does not have any specific purpose.
(B) It can be used in any emergency.
(C) Any amount, any time can be deposited in it.
(D) It is set up for a particular upcoming expense.
Choose the correct answer from the options given below:
Answer & explanation
Correct answer: option 2
The correct answer is Option (2) → (A), (B) and (C) only
(A) It does not have any specific purpose. ✔️ (NOT correct)
(B) It can be used in any emergency. ✔️ (NOT correct)
(C) Any amount, any time can be deposited in it. ✔️ (NOT correct)
(D) It is set up for a particular upcoming expense. ✖️ (Correct statement, so NOT included)
The statements that are NOT correct about a Sinking Fund are (A), (B) and (C).