Which of the following statements are true?

(A) The opening stock of the year becomes the closing stock of the next year 

(B) Closing stock is the cost of unsold goods lying in the stores at the end.

(C) Closing stock is shown on the credit side of trading account.

(D) Unpaid expenses of the accounting year are outstanding expenses at the end.

(E) Outstanding expenses are assets of the business firm.

(B), (C), (D)

The correct answer is option 1- (B), (C), (D).

(A) The opening stock of the year becomes the closing stock of the next year. IT IS FALSE as closing stock of the year becomes opening stock of the next year.

(B) Closing stock is the cost of unsold goods lying in the stores at the end. IT IS TRUE. The closing stock represents the cost of unsold goods lying in the stores at the end of the accounting period. The adjustment with regard to the closing stock is done by (i) by crediting it to the trading and profit and loss account, and (ii) by showing it on the asset side of the balance sheet.

(C) Closing stock is shown on the credit side of trading account. IT IS TRUE. The adjustment with regard to the closing stock is done by (i) by crediting it to the trading and profit and loss account, and (ii) by showing it on the asset side of the balance sheet.

(D) Unpaid expenses of the accounting year are outstanding expenses at the end. IT IS TRUE. It is quite common for a business enterprise to have some unpaid expenses in the normal course of business operations at the end of an accounting year. Such items usually are wages, salaries, interest on loan, etc. When expenses of an accounting period remain unpaid at the end of an accounting period, they are termed as outstanding expenses

(E) Outstanding expenses are assets of the business firm. IT IS FALSE as outstanding expenses are liabilities of the business firm.