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Principles-of-accounting Chapters

12th Class Chapter 3 Principles of accounting Short Questions

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Question: 1
How many parties are involved in consignment?Write their names.
Answer: 1
1-20
There are two parties involved in consignment:
1.Consignor
2.Consignee
Question: 2
Define abnormal loss of stocks.
Answer: 2
2-20
Abnormal loss is any kind of loss which is occurs due to fire,accident theft,negligence etc is known as abnormal loss of stocks ,Due to this loss consignment profit is not reduced,
Example : Goods are lost by fire a lot.
Question: 3
Write characteristics of consignment?
Answer: 3
3-20
Some characteristics of consignment are given below:
  1. Ownership not transfer to consignee ,it remain with consignor.
  2. Relationship between consignor and consignee is that principle and agent.
  3. Consignee earns commision on sale of goods.
Question: 4
What is meant by Account sales?
Answer: 4
4-20
Account sales is a report prepared by consignee and sent to the consignee,periodically.It show details about the sales of goods :expanses pay by the consignee on behalf of the consignee and agent commission.
Question: 5
Define consignment account.
Answer: 5
5-20
Consignment account show what profit or loss is made out of the dealing of goods sent on consignment,
It is the combination of trading and profit and loss account.
Question: 6
What is difference between "Account sales" and "Sales Account"?
Answer: 6
6-20
Account Sales: Account sales is a report by consignee which shows the detail about the sales of goods,the sale price of goods.

Question: 7
What is "Outward Consignment"?
Answer: 7
7-20
When goods are dispatched by the consignor to the consignee for the purpose of sale on commision ,it will be consignment outwards from consignor view point
Example Asad (Consignor) send goods to Mr.Qasim for sale purpose (Outwards consignment for Asad).
Question: 8
What is consignment inward?
Answer: 8
8-20
When goods are dispatched by the consignor to the consignee,it will be a consignment inward from consignee view point
Example: Alex take goods from asad to sale purpose (consignment inward).
Question: 9
What is indirect expenses?
Answer: 9
9-20
Expenses incurred after reaching the goods in the godown of consignee are called indirect expenses.
Example : Godown rent,Salesman,Salary etc.
Question: 10
What is the difference between Goods consigned and Goods sold?
Answer: 10
10-20
Goods Consigned:
  1. The ownership is not transferred to the consignee,it remain with consignor,
  2. Relation between consignee and consigner is that of principal and agent.
  3. Expenses after delivery is to be borne by consignor.
Question: 11
What is normal loss?
Answer: 11
11-20
Normal loss is any kind of loss which is occured due to natural cause,such as normal leakage,loss in weight etc,
Such loss inflated the values of closing stock.
Example: Goods are sent back by buyer due to leakage.
Question: 12
What is overriding commission?
Answer: 12
12-20
Overriding commission is normally granted by consigner ,when he desired his agent to work hard to push a new line of products in the market.
Example: Consigner give extra commission to consignee to produce a new product in the market.
Question: 13
What is consignment?
Answer: 13
13-20
Consignment is an act of sending the goods by the owner to his agent.The agent is agreed to collected and sell them on the risks and behalf of the owner on commission basis.
Question: 14
What is meant by consignor?
Answer: 14
14-20
The manufacturer or wholesaler who sends his goods for sale purpose to his agent is known as consignor.
Example : Asad send goods to Alex for sale purpose.
Question: 15
What is difference between "Del-credere commission" and "Overriding commission"?
Answer: 15
15-20
Del-credere commission: Del-credere commission is an extra commission ,which is paid to consignee if loss on account of bad debts is borne by him.
Question: 16
What is meant by consignment commision?
Answer: 16
16-20
Consignment commission is the remuneration or money of the consignee for selling the goods of the consignor is called commission or consignment commision.
Example : Consignee sale good and earn Rs 5000 as commision.
Question: 17
Define direct expanse of consignment.
Answer: 17
17-20
Direct expenses are all those expenses which are incurred before searching the goods in the godown of consignee,It does not matter if these expenses are paid by consignor or consignee.
Example: Carriage ,Freight etc.
Question: 18
Define the term cosinee?
Answer: 18
18-20
Consignee is the person to whom the goods are sent for sale purpose by consigner at the rate of some commision,
Example Zahid received goods from Asad for sale purpose at some commision.
Question: 19
What is Performa Invoice?
Answer: 19
19-20
Performa invoice is a forwarding letter sent by consignor to consignee along with the goods containing particular as the name of items ,number and the price.
Example: Amir sent good to consignee along with the list(Performa invoice.)
Question: 20
Define Del-credere commision.
Answer: 20
20-20
Del-credere commission is the extra commision ,which is paid to the consignee,if loss account of Bad debts is borne by him.
Example : Consignee took delcredere commission by consignor as ad debts borne by him.

12th Class Principles-of-accounting Chapters Short Questions