Match List – I with List – II.

Choose the correct answer from the options given below :

A-III, B-I, C-IV, D-II

The correct answer is option 3- A-III, B-I, C-IV, D-II.

* Stock of goods in hand at the beginning of the accounting year- Opening stock. Opening stock is the stock of goods in hand at the beginning of the accounting year. This is the stock of goods which has been carried forward from the previous year and remains unchanged during the year and appears in the trial balance. In the trading account it appears on the debit side because it forms the part of cost of goods sold for the current accounting year

* Freight inwards- Direct expense. Freight inward are the items of transport expenses, which are incurred on bringing materials/goods purchased to the place of business. These items are paid in respect of purchases made during the year and are debited to the trading account as it is a direct expense related to the production of goods.

* Balance sheet- Determine financial position. The balance sheet is a statement of assets and liabilities of a business enterprise and shows the financial position at a given date Information contained in a balance sheet is true only on that date. The balance sheet is a part of the final account. But it is not an account, it is only a statement. In a balance sheet the totals of assets and liabilities are always equal. It portrays the accounting equation.

* Rent, rates and taxes- Indirect expense. These include office and godown rent, municipal rates and taxes. The amount paid is shown on the debit side of the profit and loss account. Indirect expenses are not related with the direct production of goods.