Question

All receipts of capital nature are shown in:

• A. Income and Expenditure A/c
• B. Balance Sheet
• C. Profit and Loss A/c
• D. Cash Flow Statement

Hint:

Capital receipts (like loans, share capital) affect financial position → always recorded in Balance Sheet.

Answer 1

The Correct Option is B

Step 1: Differentiate revenue and capital receipts.
- Revenue receipts are recurring in nature and are shown in Income & Expenditure A/c (or P& L).
- Capital receipts are non-recurring in nature and affect the financial position of the firm.
Step 2: Examples of capital receipts.
Capital receipts include loan taken, sale of fixed assets, issue of shares/debentures, etc.
Step 3: Treatment.
Since they affect assets and liabilities, they are shown in the Balance Sheet, not in income-related accounts.
Final Answer: \[ \boxed{\text{Balance Sheet}} \]