- 1 Marks
Question
The excess of minimum royalty over actual royalty paid on output is called ………………..
Answer
Short workings
Explanation:
Short workings represent the excess amount that is paid when the actual royalty based on production is lower than the minimum royalty payable as per the agreement. The lessee can later recover this amount if production increases. Therefore, the correct answer is “Short workings.”
- Tags: Lease Agreements, Royalty
- Level: Level 1
- Topic: Accounting Concepts
- Series: MAY 2012
- Uploader: Theophilus