If a manager's commission is 10% of the net profit before charging such commission, and the net profit is ₹110, what is the commission?

Correct Option: B. Solution: The commission is calculated as 10% of ₹110, which is ₹11.

Financial Statements - II

Objectives Notes Exam Tips Practice Qs Ask AI

Learning Objectives

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Learning Objectives

Describe the need for adjustments while preparing the financial statements.
Explain the accounting treatment of adjustments for outstanding and prepaid expenses, accrued and advance receipts of incomes.
Discuss the adjustments to be made regarding depreciation, bad debts, provision for doubtful debts, provision for discount on debtors.
Explain the concepts and adjustment of manager's commission and interest on capital.
Prepare profit and loss account and balance sheet with adjustments.

Revision Notes & Summary

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Financial Statements - II

Learning Objectives

Describe the need for adjustments while preparing the financial statements.
Explain the accounting treatment of adjustments for outstanding and prepaid expenses, accrued and advance receipts of incomes.
Discuss the adjustments to be made regarding depreciation, bad debts, provision for doubtful debts, provision for discount on debtors.
Explain the concepts and adjustment of manager's commission and interest on capital.
Prepare profit and loss account and balance sheet with adjustments.

Need for Adjustments

The accrual concept of accounting necessitates adjustments to reflect true profitability and financial position.
Items requiring adjustments include:
- Outstanding expenses
- Prepaid expenses
- Accrued incomes
- Income received in advance

Key Terms Introduced in the Chapter

Outstanding / Accrued expenses: Unpaid expenses at the end of the accounting period.
Prepaid/Unexpired expenses: Expenses paid in advance for future periods.
Accrued Incomes: Income earned but not yet received.
Income received in advance: Income received for future periods.
Depreciation: Reduction in the value of an asset over time.
Bad Debts: Debts that are unlikely to be collected.
Provision for doubtful debts: An estimate of debts that may not be collected.
Provision for discount on debtors: An estimate of discounts expected to be given to debtors.
Manager's Commission: A fee paid to the manager based on profits.
Interest on Capital: Interest payable to partners on their capital contributions.

Adjustments and Their Treatment

Adjustment Type	Adjustment Entry	Treatment in Trading and Profit and Loss Account	Treatment in Balance Sheet
Closing stock	Closing stock A/c Dr. <br> To Trading A/c	Shown on the credit side	Shown on the assets side
Outstanding expenses	Expense A/c Dr. <br> To outstanding expense A/c	Added to the respective expense	Shown on the liabilities side
Prepaid/Unexpired expenses	Prepaid expense A/c Dr. <br> To Expenses A/c	Deducted from the respective expense	Shown on the assets side
Accrued income	Accrued income A/c Dr. <br> To Income A/c	Added to the respective income	Shown on the assets side
Income received in advance	Income A/c Dr. <br> To Income received in advance A/c	Deducted from the respective income	Shown on the liabilities side
Depreciation	Depreciation A/c Dr. <br> To Assets A/c	Shown on the debit side	Deducted from the value of asset
Provision for bad debts	Profit and Loss A/c Dr. <br> To Provision for doubtful debts	Shown on the debit side	Shown as deduction from debtors
Provision for discount on debtors	Profit and Loss A/c Dr. <br> To Provision for discount on debtors	Shown on the debit side	Shown as deduction from debtors
Manager's commission	Manager's commission A/c Dr. <br> To outstanding commission A/c	Shown on the debit side	Shown on the liabilities side
Interest on capital	Interest on capital A/c Dr. <br> To capital A/c	Shown on the debit side	Shown as addition to capital
Further bad debts	Bad debts A/c Dr. <br> To Sundry Debtors A/c	Shown on the debit side	Deducted from debtors

Example Adjustments

Bad debts: Further bad debts ₹300, maintain provision for bad debts at 10%.
Closing Stock: Closing stock valued at ₹20,000.
Depreciation: Depreciate furniture by 10%.
Manager's Commission: Provide for manager's commission at 10% on net profit before charging such commission.

Exam Tips & Common Mistakes

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Common Mistakes and Exam Tips

Common Pitfalls

Ignoring Adjustments: Students often forget to make necessary adjustments for outstanding and prepaid expenses, which can lead to inaccurate financial statements.
Misclassifying Expenses: Failing to distinguish between capital and revenue items can result in incorrect entries.
Not Following the Accrual Basis: Many students mistakenly record income and expenses on a cash basis instead of an accrual basis, affecting the true profitability of the business.
Overlooking Depreciation: Students may forget to apply depreciation on assets, which can significantly alter the financial results.
Inaccurate Provision Calculations: Incorrectly calculating provisions for bad debts or discounts on debtors can lead to misstatements in the accounts.

Tips for Avoiding Mistakes

Double-Check Adjustments: Always review the adjustments needed for outstanding and prepaid expenses before finalizing accounts.
Understand Accounting Principles: Familiarize yourself with the accrual concept and the distinction between capital and revenue items to avoid misclassifications.
Practice Depreciation Calculations: Regularly practice calculating depreciation to ensure accuracy in financial statements.
Use Checklists: Create a checklist of common adjustments and principles to follow when preparing financial statements.
Review Past Papers: Go through previous exam questions to identify common areas where students make mistakes.

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Practice Test – MCQs, True/False

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Multiple Choice Questions

Depreciation on machinery

Prepaid insurance

Accrued income

Outstanding salary

Correct Answer: A

Solution:

Depreciation on machinery is an expense and affects the profit and loss account.

To provide electrical power

To measure the induced current

To facilitate magnetic coupling between coils

To act as a resistor

Correct Answer: C

Solution:

The core, made of soft iron, facilitates magnetic coupling between the primary and secondary coils in the electromagnetic induction setup.

As a direct expense in the Profit and Loss account

As a capital expenditure added to the cost of furniture

As an indirect expense in the Profit and Loss account

As a prepaid expense

Correct Answer: B

Solution:

The wages incurred for making furniture are considered a capital expenditure and should be added to the cost of the furniture, not treated as a direct expense in the Profit and Loss account.

Record at ₹50,000 in the balance sheet

Record at ₹40,000 in the balance sheet

Record at ₹45,000 in the balance sheet

Do not record in the balance sheet

Correct Answer: B

Solution:

Closing stock is recorded at the lower of cost or market value, so it should be recorded at ₹40,000.

Insurance paid in advance

Rent received in advance

Salaries not yet paid

Commission received

Correct Answer: C

Solution:

Outstanding expenses are those that have been incurred but not yet paid, such as salaries not yet paid.

Rent due but not yet paid

Insurance paid for the next year

Commission received in advance

Interest on bank deposits

Correct Answer: B

Solution:

Insurance paid for the next year is an example of a prepaid expense.

Accrual concept

Consistency concept

Going concern concept

Prudence concept

Correct Answer: A

Solution:

The accrual concept requires that expenses be matched with revenues in the period in which they are incurred, regardless of when cash transactions occur.

₹5,44,300

₹5,44,000

₹5,44,700

₹5,44,500

Correct Answer: A

Solution:

COGS is calculated as: Opening Stock + Purchases - Closing Stock. Therefore, COGS = ₹25,000 + ₹5,55,300 - ₹36,000 = ₹5,44,300.

To increase the profit

To decrease the liabilities

To account for potential bad debts

To adjust for prepaid expenses

Correct Answer: C

Solution:

A provision for doubtful debts is created to account for debts that are unlikely to be collected.

As an asset in the balance sheet

As a liability in the balance sheet

As an income in the profit and loss account

As an expense in the profit and loss account

Correct Answer: B

Solution:

Outstanding wages are recorded as a liability in the balance sheet as they represent an obligation to pay in the future.

₹10

₹11

₹9

₹12

Correct Answer: B

Solution:

The commission is calculated as 10% of ₹110, which is ₹11.

Prepaid expenses

Outstanding expenses

Accrued income

Unearned income

Correct Answer: B

Solution:

Outstanding expenses are those that are unpaid at the end of the accounting period.

To convert a string containing numbers into a numeric value

To calculate depreciation on assets

To prepare final accounts

To adjust outstanding expenses

Correct Answer: A

Solution:

The Val() function is used to return the numbers contained in a string as a numeric value of appropriate type.

₹5,44,300

₹5,44,700

₹5,44,300

₹5,44,700

Correct Answer: A

Solution:

Cost of Goods Sold (COGS) is calculated as Opening Stock + Purchases - Closing Stock. Therefore, COGS = ₹25,000 + ₹5,55,300 - ₹36,000 = ₹5,44,300.

Recording only cash transactions

Adjusting for outstanding and prepaid expenses

Ignoring depreciation on assets

Recording only revenues received in cash

Correct Answer: B

Solution:

According to the accrual concept of accounting, it is necessary to adjust for outstanding and prepaid expenses to accurately reflect the financial position and profitability of a business.

As an increase in asset value

As a liability

As an expense

As income

Correct Answer: C

Solution:

Depreciation is accounted for as an expense in financial statements, reflecting the decline in the value of an asset over time.

They are recorded as liabilities

They are recorded as assets

They are recorded as income

They are recorded as expenses

Correct Answer: B

Solution:

Prepaid expenses are recorded as assets because they represent payments made for benefits to be received in future periods.

To overstate the financial position of the company

To prepare for potential future bad debts

To reduce the taxable income

To increase the net profit

Correct Answer: B

Solution:

A provision for doubtful debts is maintained to account for potential future bad debts, ensuring that the financial statements reflect a more accurate financial position.

Recording only cash transactions

Adjusting for outstanding and prepaid expenses

Ignoring accrued incomes

Recording only revenue items

Correct Answer: B

Solution:

Adjustments for outstanding and prepaid expenses are necessary to reflect the true state of affairs in financial statements.

To record all cash transactions

To ensure all transactions are recorded on a cash basis

To reflect the true profit and loss and financial position of the firm

To prepare the trial balance

Correct Answer: C

Solution:

Adjusting entries are necessary to reflect the true profit and loss and financial position of the firm by accounting for all accrued and prepaid items.

Record the closing stock at ₹50,000

Record the closing stock at ₹40,000

Record the closing stock at an average of ₹45,000

Do not record the closing stock

Correct Answer: B

Solution:

According to the conservatism principle, inventory should be recorded at the lower of cost or market value, which in this case is ₹40,000.

As a liability

As an asset

As an income

As an expense

Correct Answer: B

Solution:

Prepaid expenses are treated as an asset because they represent future economic benefits that will be received.

It acts as a battery

It provides electrical resistance

It facilitates magnetic coupling between coils

It measures induced current

Correct Answer: C

Solution:

The soft iron core enhances the magnetic field and facilitates magnetic coupling between the primary and secondary coils, thus aiding in electromagnetic induction.

₹10,000

₹11,000

₹9,000

₹12,000

Correct Answer: B

Solution:

The commission is calculated as 10% of the net profit before commission: 10% of ₹110,000 = ₹11,000.

Conservatism

Accrual

Consistency

Materiality

Correct Answer: A

Solution:

The conservatism concept dictates that closing stock should be recorded at the lower of cost or market value.

Recording only cash transactions.

Ignoring outstanding expenses.

Adjusting for prepaid expenses.

Recording revenues only when cash is received.

Correct Answer: C

Solution:

Adjusting for prepaid expenses is necessary to ensure that the financial statements accurately reflect the expenses that pertain to the current accounting period.

₹300

₹200

₹100

₹400

Correct Answer: A

Solution:

The total adjustment for outstanding expenses is the sum of all outstanding amounts: ₹100 (wages) + ₹200 (rent) = ₹300.

₹7,700

₹8,000

₹8,300

₹8,500

Correct Answer: B

Solution:

The new provision for doubtful debts is calculated as 10% of ₹80,000, which equals ₹8,000. The further bad debts of ₹300 are written off separately and do not affect the provision calculation.

Interest to be received on bank deposits

Rent paid in advance

Insurance premium paid

Salary paid to employees

Correct Answer: A

Solution:

Accrued income refers to income that has been earned but not yet received. Interest to be received on bank deposits is an example of accrued income.

Rent received in advance

Interest earned but not yet received

Prepaid insurance

Outstanding wages

Correct Answer: B

Solution:

Accrued income refers to income that has been earned but not yet received. Interest earned but not yet received is a typical example of accrued income.

Dendrites

Myelin Sheath

Axon

Chloroplast

Correct Answer: D

Solution:

Chloroplast is not a component of a neuron; it is an organelle found in plant cells responsible for photosynthesis.

Increases the value of assets

Decreases the value of assets

Increases the net profit

Has no effect on the financial statements

Correct Answer: B

Solution:

Depreciation decreases the value of assets as it accounts for the wear and tear or obsolescence of the asset over time.

₹2,500

₹2,000

₹2,300

₹2,800

Correct Answer: A

Solution:

Total charge = Bad debts (₹2,000) + Further bad debts (₹500) = ₹2,500. Provision is adjusted separately based on the new debtor balance.

As a percentage of the net profit before charging the commission.

As a fixed amount regardless of profit.

As a percentage of total sales.

As a percentage of net profit after charging the commission.

Correct Answer: A

Solution:

Manager's commission is calculated as a percentage of the net profit before charging such commission, unless specified otherwise.

Consistency principle

Accrual principle

Matching principle

Conservatism principle

Correct Answer: C

Solution:

The matching principle is applied when adjusting for depreciation to ensure that expenses are matched with the revenues they help to generate.

It should be credited to the trading account and shown as an asset in the balance sheet.

It should be debited to the profit and loss account.

It should be shown as a liability in the balance sheet.

It should be ignored as it is not a cash transaction.

Correct Answer: A

Solution:

The closing stock is credited to the trading account and shown as an asset in the balance sheet to reflect the unsold goods at the end of the accounting period.

The galvanometer shows no deflection.

The galvanometer shows a steady deflection.

The galvanometer shows a momentary deflection.

The galvanometer shows a fluctuating deflection.

Correct Answer: C

Solution:

When the key in Coil 1 is closed, a current starts flowing through it, inducing a momentary current in Coil 2 due to electromagnetic induction, which causes a momentary deflection in the galvanometer.

It is debited to the trading account only

It is shown on the liability side of the balance sheet

It is credited to the trading account and shown on the asset side of the balance sheet

It is shown on the income statement only

Correct Answer: C

Solution:

Closing stock is credited to the trading account and shown on the asset side of the balance sheet.

Accrual Basis of Accounting

Cash Basis of Accounting

Historical Cost Principle

Matching Principle

Correct Answer: A

Solution:

The accrual basis of accounting requires that revenues and expenses be recognized in the period in which they are earned or incurred, not necessarily when cash is received or paid.

They are added to the respective expense accounts and shown as a liability.

They are subtracted from the respective expense accounts.

They are shown as an asset.

They are ignored until payment is made.

Correct Answer: A

Solution:

Outstanding expenses are added to the respective expense accounts and shown as a liability in the balance sheet.

Recording only cash transactions

Adjusting for outstanding expenses

Ignoring prepaid expenses

Recording only revenue received in cash

Correct Answer: B

Solution:

According to the accrual basis of accounting, adjustments for outstanding expenses are necessary to reflect the true financial position.

Accrual Concept

Cash Basis Concept

Matching Concept

Revenue Recognition Concept

Correct Answer: A

Solution:

The accrual concept mandates that expenses and revenues are recorded in the period they are incurred and earned, respectively, regardless of when the cash transactions occur.

Increases liabilities

Decreases assets

Increases assets

Decreases equity

Correct Answer: C

Solution:

Accrued income is income that has been earned but not yet received, thus it increases assets.

Expenses that have been paid for but the benefits have not yet been fully received.

Expenses that are due but not yet paid.

Expenses that have been incurred but not yet recorded.

Expenses that are recorded in advance for future periods.

Correct Answer: A

Solution:

Prepaid expenses are those for which payment has been made, but the benefits will be received in future accounting periods.

Revenue is recognized when cash is received.

Expenses are recognized when paid.

Revenue is recognized when earned, regardless of cash receipt.

Expenses are recognized only when cash is paid.

Correct Answer: C

Solution:

The accrual concept of accounting states that revenues should be recognized when they are earned, and expenses should be recognized when they are incurred, regardless of when cash transactions occur.

To convert a string containing numbers into a numeric value.

To calculate the length of a string.

To concatenate two strings.

To reverse a string.

Correct Answer: A

Solution:

The Val() function is used to convert a string containing numbers into a numeric value. It stops reading the string at the first character that cannot be recognized as a number.

As an asset in the balance sheet

As a liability in the balance sheet

As income in the profit and loss account

As an expense in the profit and loss account

Correct Answer: B

Solution:

Outstanding expenses are those that have been incurred but not yet paid by the end of the accounting period. They are recorded as liabilities in the balance sheet.

12431

124

431

Correct Answer: B

Solution:

The Val() function stops reading the string at the first character that cannot be recognized as a number, thus it returns 12.

True or False

Correct Answer: False

Solution:

The Val() function stops reading the string at the first character that cannot be recognized as a number.

Correct Answer: False

Solution:

Prepaid expenses are recorded as assets in the balance sheet because they represent future economic benefits that the business will receive.

Correct Answer: False

Solution:

The manager's commission can be calculated on the net profit either before or after charging such commission, depending on the agreement.

Correct Answer: False

Solution:

Depreciation is charged on non-current assets to account for their wear and tear or obsolescence over time.

Correct Answer: True

Solution:

Outstanding expenses are liabilities that represent expenses incurred but not yet paid at the end of the accounting period.

Correct Answer: False

Solution:

In the setup, the primary coil is connected to a battery, and the secondary coil is connected to a galvanometer.

Correct Answer: True

Solution:

Depreciation is an accounting method that allocates the cost of a tangible asset over its useful life, reducing its value over time.

Correct Answer: True

Solution:

According to the accrual concept, revenues should be recognized when they are earned, regardless of when the cash is received.

Correct Answer: True

Solution:

The Val() function is designed to convert a string to a numeric value and stops at the first non-numeric character.

Correct Answer: False

Solution:

The accrual concept of accounting states that profit or loss is not based on cash transactions but on revenues earned and expenses incurred during the year.

Correct Answer: True

Solution:

According to the accrual concept, expenses should be recorded when they are incurred, regardless of when they are actually paid.

Correct Answer: True

Solution:

Depreciation reflects the decrease in value of an asset over time due to usage and other factors.

Correct Answer: False

Solution:

Under the accrual basis of accounting, revenues are recognized when they are earned, not necessarily when they are received in cash.

Correct Answer: True

Solution:

According to the accrual concept of accounting, revenues are recognized when they are earned, regardless of when the cash is received.

Correct Answer: False

Solution:

The preparation of financial statements requires adjustments according to the accrual basis of accounting to reflect the true and fair view of the business.

Correct Answer: True

Solution:

The Val() function converts a string to a number and stops reading at the first character that cannot be recognized as a number.

Correct Answer: True

Solution:

According to the accrual concept of accounting, revenues should be considered on an earned basis, rather than on a receipt basis.

Correct Answer: True

Solution:

Depreciation accounts for the reduction in value of an asset over time due to usage and aging.

Correct Answer: True

Solution:

Depreciation is an adjustment to reflect the decline in value of an asset over time and is necessary for accurate financial statements.

Correct Answer: True

Solution:

A provision for doubtful debts is an estimate of the amount of debts that may not be collected, ensuring that the financial statements reflect a more accurate financial position.

Correct Answer: False

Solution:

Prepaid expenses are those for which the benefits will be received in future accounting periods.

Correct Answer: True

Solution:

Prepaid expenses are considered assets because they represent future economic benefits that will be received.

Correct Answer: False

Solution:

Accrued income is income that has been earned but not yet received.

Correct Answer: True

Solution:

Depreciation accounts for the decline in the value of an asset due to wear and tear or passage of time.

Correct Answer: True

Solution:

Depreciation represents the decline in the value of an asset due to wear and tear or passage of time, and it is treated as an expense.

Correct Answer: False

Solution:

Outstanding expenses are those that have been incurred but not yet paid, not those paid in advance.

Correct Answer: False

Solution:

The manager's commission can be calculated on the net profit either before or after charging such commission, depending on the agreement.

Correct Answer: False

Solution:

Accrued income is income that has been earned but not yet received, whereas income received in advance is unearned income.

Correct Answer: True

Solution:

The Val() function stops reading the string at the first character that cannot be recognized as a number.

Correct Answer: True

Solution:

Depreciation involves spreading the cost of an asset over its useful life to account for wear and tear or obsolescence.

Correct Answer: True

Solution:

If there is no specific information, it is assumed that the manager's commission is calculated on the net profit before charging the commission.

Correct Answer: False

Solution:

The accrual concept of accounting states that profit or loss is based on revenues earned and expenses incurred, not just on cash transactions.

Correct Answer: True

Solution:

Adjustments for outstanding and prepaid expenses are necessary to ensure that the financial statements accurately reflect the business's financial position according to the accrual basis of accounting.

Correct Answer: False

Solution:

Outstanding expenses are those that have been incurred but not yet paid by the end of the accounting period.

Financial Statements - II

Learning Objectives

Learning Objectives

Revision Notes & Summary

Financial Statements - II

Learning Objectives

Need for Adjustments

Key Terms Introduced in the Chapter

Adjustments and Their Treatment

Example Adjustments

Exam Tips & Common Mistakes

Common Mistakes and Exam Tips

Common Pitfalls

Tips for Avoiding Mistakes

AI Learning Assistant

Practice Test – MCQs, True/False

Multiple Choice Questions

Q1.Which of the following adjustments would affect the profit and loss account?

Correct Answer: A

Q2.What is the role of the 'Core' in the experimental setup for electromagnetic induction?

Correct Answer: C

Q3.A business has incurred wages of ₹2,000 for the making of furniture. How should this expense be treated in the financial statements?

Correct Answer: B

Q4.If the closing stock is valued at ₹40,000 but the market value is ₹50,000, how should it be recorded in the financial statements?

Correct Answer: B

Q5.Which of the following is an example of an outstanding expense?

Correct Answer: C

Q6.Which of the following is an example of a prepaid expense?

Correct Answer: B

Q7.Which accounting concept requires that expenses be matched with revenues in the period in which they are incurred?

Correct Answer: A

Q8.A company has an opening stock of ₹25,000 and purchases worth ₹5,55,300 during the year. If the closing stock is valued at ₹36,000, what is the cost of goods sold (COGS) for the year?

Correct Answer: A

Q9.What is the purpose of creating a provision for doubtful debts?

Correct Answer: C

Q10.If a company has outstanding wages of ₹100 at the end of the accounting period, how should it be recorded?

Correct Answer: B

Q11.If a manager's commission is 10% of the net profit before charging such commission, and the net profit is ₹110, what is the commission?

Correct Answer: B

Q12.If a business has unpaid expenses at the end of the accounting period, these are termed as:

Correct Answer: B

Q13.What is the purpose of the Val() function in accountancy?

Correct Answer: A

Q14.If a business enterprise has an opening stock of ₹25,000, purchases worth ₹5,55,300, and a closing stock of ₹36,000, what is the cost of goods sold?

Correct Answer: A

Q15.In the context of financial statements, which of the following adjustments is necessary to ensure that the profit or loss for an accounting year is accurately reflected according to the accrual basis of accounting?

Correct Answer: B

Q16.How is depreciation on machinery typically accounted for in financial statements?

Correct Answer: C

Q17.What is the accounting treatment for prepaid expenses?

Correct Answer: B

Q18.What is the purpose of maintaining a provision for doubtful debts in accounting?

Correct Answer: B

Q19.Which adjustment is necessary for the preparation of financial statements to reflect the true state of affairs?

Correct Answer: B

Q20.What is the purpose of adjusting entries in the preparation of final accounts?

Correct Answer: C

Q21.A company has a closing stock valued at ₹50,000, but the market value is ₹40,000. According to accounting principles, how should this be reflected in the financial statements?

Correct Answer: B

Q22.How should prepaid expenses be treated in the financial statements?

Correct Answer: B

Q23.In an experimental setup for electromagnetic induction, what role does the soft iron core play?

Correct Answer: C

Q24.If a manager's commission is 10% on the net profit before charging such commission, and the net profit before commission is ₹110,000, what is the manager's commission?

Correct Answer: B

Q25.If the closing stock is valued at ₹40,000 but the market value is ₹50,000, which accounting concept is being followed?

Correct Answer: A

Q26.Which of the following adjustments is necessary for the preparation of financial statements to reflect a true and fair view of the business?

Correct Answer: C

Q27.In preparing the final accounts, a business has outstanding wages of ₹100 and outstanding rent of ₹200. What is the total adjustment to be made for outstanding expenses?

Correct Answer: A

Q28.A company has a provision for doubtful debts of ₹5,000 and further bad debts amounting to ₹300. If the company decides to maintain a provision for doubtful debts at 10% of the total debtors, and the debtors amount to ₹80,000, what will be the new provision for doubtful debts?

Correct Answer: B

Q29.Which of the following is an example of an accrued income?

Correct Answer: A

Q30.Which of the following is an example of an accrued income?

Correct Answer: B

Q31.Which of the following is NOT a component of a neuron?

Correct Answer: D

Q32.What is the effect of depreciation on the financial statements?