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Home › CBSE Class 11 (Commerce) › Accountancy › Depreciation, Provisions and Reserves › Which of these can build a secret reserve?

Which of these can build a secret reserve?

AExpensing capital outlay
BWriting off a bad debt
CPaying out dividends
DRaising share capital
Answer & Solution
Correct answer: A. Expensing capital outlay
Treating capital spending as an expense lowers shown profit while the asset value stays hidden.
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