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State one transaction which results in an increase in â??liquid ratioâ?? and nochange in â??current ratioâ??.

Asked by Nitin 08/03/2018 Last Modified 09/03/2018

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P P Limited is Share Broker Company. G G Limited is engaged in manufacturing of packaged food. P P Limited purchased 5,000 equity shares of Rs. 100 each of Savita Limited. G G Limited also purchased 10,000 equity shares of Rs. 100 each of Savita Limited. For the purpose of preparing their respective Cash Flow Statements, under which category of activities the purchase of shares will be classified by P P Limited and G G Limited?

For GG limited it is an investment so it come in Investing Activity but as PP Ltd business is of selling shares so it will be part of Operating Activity :)

Balakrishna

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Is a partner entitled to salary if he works more than others if partnership deed is silent?

No partner is entitled to a salary if Partnership Deed is silent on it. It doesnt make any difference if he works more than others, if Partnership Deed is silent on it.

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Is it possible for one hospital to have an income and expenditure account whereas another has a profit and loss account?

It depends on the type of organisation let me illustrate with an example hospitals that are runned by state government or any NGO or trust does not profit motive hence they will prepare Income and expenditure...

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There is no agreement regarding sharing of profits (or) partnerships salary. Rose is a whole-time partner whereas Lilly does not attend business regularly. Rose claims Rs 3,000 salary a month and 60% of balance profits Rs 24,600 Lilly advanced Rs 10,000 as loan and now she claims 10% interest. State how you will settle the accounts.

No salary to any partner. Profits will be shared equally. Interest on loan will be paid at 6% p.a.

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Under which accounting standard, cash flow statement is prepared?

Accounting standard 7

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