Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Financial Statements of a Company

Question:
Gratuity paid comes under which major head while preparing the statement of profit and loss by the company?
Options:
Other expenses
Finance costs
Depreciation and Amortization expenses
Employee Benefit expenses
Correct Answer:
Employee Benefit expenses
Explanation:
Expenses incurred on employees towards salary, wages, leave encashment, staff welfare, etc., are shown under this head. Employees benefit expenses may be further categorised into direct and indirect expenses.