Ask a Doubt
Request a call back

Join NOW to get access to exclusive study material for best results

CBSE Class 11-commerce Answered

Define reserve. Also state its types with examples.
Asked by Topperlearning User | 08 Aug, 2016, 01:16: PM
answered-by-expert Expert Answer

Reserve is an amount set aside from the profit and other surplus which is retained by the business to meet future contingencies. It is an appropriation of profit and not a charge against profit, and therefore it is shown in profit and loss appropriation account.

Types of reserves:

A. Revenue reserve:

i. General reserve

ii. Specific reserve:

a. Dividend equalisation reserve

b. Workmen compensation fund

c. Investment fluctuation fund

d. Debenture redemption reserve

B. Capital reserve:

  1. Profit prior to incorporation
  2. Premium on issue of shares or debentures
  3. Profit on redemption of debenture
  4. Profit on forfeiture of share
  5. Profit on sale of fixed assets
  6. Capital redemption reserve
  7. Profit on revaluation of fixed assets and liabilities 
Answered by | 08 Aug, 2016, 03:16: PM
Multiple Choice Questions Practice Test
Answered Unanswered My Questions My Answers
CBSE 11-commerce - Accountancy Part I
Give any two differences between Reserves and Provisions.
Asked by Topperlearning User | 04 Jul, 2016, 08:16: AM
ANSWERED BY EXPERT ANSWERED BY EXPERT
CBSE 11-commerce - Accountancy Part I
Vinod Ltd. purchased a machinery of Rs.3,00,000 on 1st July, 2012 and Rs.3,00,000 on 1st November 2012. A company purchased one more machinery on 1stJanurary 2013 for Rs.2,00,000. A company sold one machinery for Rs.2,10,000 on 31st march 2014 which was purchased on 1st July 2012. Company purchased on second hand machinery on the same date for Rs.1,00,000. Rate of the depreciation is 10% by Straight Line Method and closes it’s accounts on 31st December every year. Prepare Machinery Account, Machinery Disposable Account and Provision for Depreciation A/c.
Asked by Topperlearning User | 04 Jul, 2016, 09:00: AM
ANSWERED BY EXPERT ANSWERED BY EXPERT
CBSE 11-commerce - Accountancy Part I
Define provision. State its importance.
Asked by Topperlearning User | 08 Aug, 2016, 01:00: PM
ANSWERED BY EXPERT ANSWERED BY EXPERT
CBSE 11-commerce - Accountancy Part I
Define reserve. Also state its types with examples.
Asked by Topperlearning User | 08 Aug, 2016, 01:16: PM
ANSWERED BY EXPERT ANSWERED BY EXPERT
CBSE 11-commerce - Accountancy Part I
Differentiate between provision and reserves.
Asked by Topperlearning User | 08 Aug, 2016, 12:58: PM
ANSWERED BY EXPERT ANSWERED BY EXPERT
CBSE 11-commerce - Accountancy Part I
Distinguish between specific reserve and general reserve.
Asked by Topperlearning User | 08 Aug, 2016, 12:58: PM
ANSWERED BY EXPERT ANSWERED BY EXPERT
CBSE 11-commerce - Accountancy Part I
‘Reserve is an appropriation of profit’ Do you agree? If yes, why?
Asked by Topperlearning User | 08 Aug, 2016, 12:58: PM
ANSWERED BY EXPERT ANSWERED BY EXPERT
CBSE 11-commerce - Accountancy Part I
‘Provision cannot be used for dividend distribution.’ Why?
Asked by Topperlearning User | 08 Aug, 2016, 12:58: PM
ANSWERED BY EXPERT ANSWERED BY EXPERT
My Class Videos Tests ₹ Plans Ask a Doubt
Get Latest Study Material for Academic year 24-25 Click here
×