Outstanding Salaries for the current year is shown
A. In the Opening Balance Sheet, as an asset
B. In the Closing Balance Sheet, as an asset
C. In the Income and Expenditure A/c by adding to the expense 'salary'
D. In the Closing Balance Sheet, as a liability
Choose the correct answer form the options given below:
Answer & explanation
Correct answer: option 4
The correct answer is Option (4) → C and D only
The Income and Expenditure Account is prepared on the accrual basis, so salary of the current year that has not yet been paid is still an expense of the year, and the club owes it at the year end.
A. In the Opening Balance Sheet, as an asset False. Salary outstanding for the current year arises at the end of the year, and an amount owed is never an asset.
B. In the Closing Balance Sheet, as an asset False. Unpaid salary is owed by the club, so it is a liability, not an asset.
C. In the Income and Expenditure A/c by adding to the expense 'salary' True. The salary paid is increased by the outstanding amount so that the full expense of the year is charged.
D. In the Closing Balance Sheet, as a liability True. The amount still to be paid appears under outstanding expenses on the liabilities side.
Note: This question is from the pre-rationalised NCERT book. The topic is not there in the latest NCERT book (2026-27), but it is still in the CUET 2026 syllabus, so do not skip it.
NCERT (Pre-rationalised edition): NCERT (Pre-rationalised edition):
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