Which of the following shall not be deducted from net profit while calculating managerial remuneration?
Correct answer: C. Director's remuneration
- A. Loss on sale of undertaking
- B. Debts considered bad and written off
- C. Director's remuneration
- D. Liability arising from a breach of contract
Explanation
Director's remuneration is deducted when arriving at net profit for calculating managerial remuneration. Losses on sale of an undertaking, bad debts written off, and contractual liabilities are also considered under the prescribed calculation, making this the excluded item.
Report an error
The more specific you are, the faster it gets fixed. A source beats an opinion.
Prefer email? [email protected]
About Accounting Principles
Accounting principles explain the rules used to record, classify and report business transactions. Coverage includes the accounting equation, double-entry system, accrual and cash bases, matching and prudence concepts, consistency, going concern, business entity, and the difference between capital and revenue items.
Practise Accounting Principles
351 free Accounting Principles MCQs from Accounting, each with the correct answer and an explanation. Unlimited attempts, no account needed.
Discussion
Stuck on an option, or know a faster way to get there? Ask or explain it here.
No comments yet. Be the first to explain this one.
Exams that ask Accounting questions like this
Accounting is on 3 papers prepared for on TestUstad, and all of them draw the same bank, so this question is worth knowing for every one of them.
More Accounting Principles questions
Which of the following equations is correct?
Computers taken on hire by a business for a period of twelve months should be classified as:___________?
Which of the following is a current liability?
Gross Profit is equal to_________?
Goods in stock worth 800 are destroyed by fire and the Insurance Co. is accepted the claim for 600. Adjustment would involve
Sundry debtors as per Trial Balance is 43,000 which includes 2,200 due from ‗H in respect of goods sent to him on approval basis, the cost price of which is 1,800. Rectification would involve: