Single entry question in ipcc june 2014

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amey pradip malshe (Querist)
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07 June 2014 Respected Sir/Mam,
I am the student of ICAI writing this mail to basically ask and clear my doubt about single entry question asked in the recent paper of accountancy ( ref.- may 2014 IPCC).
The provision for tax in single entry is considered to be personal expense for properitory business. But in the current exam paper (may2014-IPCC ACCOUNTING)provision for tax,opening and closing balance is given and rate of tax is also given. But as per the solution given by institute , provision for tax is considered to be the business expense. So I am requesting you to give reply whether the treatment is correct or not? Is it a correct treatment?

svraghunath

svraghunath (Expert)
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09 June 2014 as per accounting standards and guidence notes by ICAI, prov for IT is considered under profit and loss account.

it is called as profit after tax.

old book and solutions are showing it as personal expenses.

however what ever procedure you follow, doesnt make difference. ultimate objective is tallying balance sheet.