General Instructions:-
1. Prepare your Accounts neatly.
2. Show your working notes clearly.
Part A
Q1. Give any two points of difference between Gaining Ratio and Sacrificing Ratio. (1)
Q2. Joint Life Policy has been shown in the Balance Sheet at Rs.35,000. The insured amount of the policy is Rs 1,00,000. On dissolution of the firm it was surrendered for 52%. What journal entry will be made? (1)
Q3. State any two reasons for the preparation of Revaluation Account on admission of a partner. (1)
Q4. A and B are partners sharing profits in the ratio of 2:1. They admit C as a partner by giving him 1/3 share in future profits. The new profit sharing ratio will be
(a) 2:1:1 (b) 3:1:2 (c) 4:2:3 (1)
Q5. If a share of Rs. 10 issued at a premium of Rs. 2, on which Rs.9 (including premium) has been called and Rs.5 (including premium) paid is forfeited. The capital account should be debited by
(a) Rs. 12 (b) Rs.10 (c) Rs. 9 (d) Rs. 7 (1)
Q6. Debentures of Rs. 2,00,000 are issued at par but payable at a premium of 5%, premium payable will be debited to
(a) Securities premium account (b) Premium on redemption of debenture a/c
(c) Loss on issue of debenture a/c (d) Capital Reserve a/c (1)
Q7. ABC Ltd has a paid up share capital of Rs 90,00,000 and a balance of Rs 15,00,000 in securities premium account. The company management do not want to carry over the balance. State the purposes for which the balance can be utilized. (3)
Q8. Cider Ltd is a food processing company and has the latest machines for their production. Their juices are a favorite among all age groups. On the company’s fifth successful year of operation, it decided to distribute 5000 tetra packs of apple juice to child care centers in various parts of the country every month. It also decided to give employment to unemployed youth of the fruit growing areas of Himachal Pradesh near its factory. In order to meet the fund requirements, it decided to raise 60,000 shares of Rs.50 each at a premium of Rs.10 per share and 40,000 9% debentures of Rs 50 each. Pass the necessary journal entries for issue of shares and debentures. Also identify any two values the company wants to communicate to the society. (3)
Q9. A and B entered into partnership on 1st April 2013 without any partnership deed. They introduced capital of Rs. 5,00,000 and Rs. 3,00,000 respectively. On 31st October 2013, A advanced Rs. 2,00,000 by way of loan to the firm. The Profit and Loss a/c for the year ended 31st March 2014 showed a profit of Rs. 4,30,000, but the partners could not agree upon the amount of interest on loan to be charged and the basis of division of profits. Pass a journal entry for the distribution of profit and prepare the capital accounts of the partners. (3)
Q10. On 31st March 2014 Sarswati Ltd, redeemed 25,00,000 , 9% debentures at a premium of 5% out of profits. Pass necessary journal entries for redemption of debentures. (3)
Q11. A and B are partners in a firm sharing profits and losses in the ratio of 3:2 the following is the Balance Sheet of the firm as on 31.3. 2014
Liabilities / Amt (Rs) / Assets / Amt (Rs)Capital: A
B / 60,000
20,000
80,000 / Sundry assets / 80,000
80,000
The profit Rs.30,000 for the year ended 31.3.2014 were divided between the partners without allowing interest on capital @12% p.a. and salary to A @1,000 per month. During the year A withdrew Rs 10,000 and B Rs20,000. Pass the necessary adjustment journal entry. Show your workings clearly. (4)
Q12. Sunil, Sham and Vinod are partners in a firm in the ratio of 5:4:2. On 1st April, 2014 they decided to share future profits in the ratio of 4:3:2. On this date General Reserve was Rs. 34,900 and loss on revaluation of assets and liabilities was Rs. 5,200. It was decided to make adjustments without altering the accounts. Make the necessary adjustment by a single journal entry. (4)
Q13. Himani, Divya and Heena are partners sharing profits in the ratio of 3:2:1. Divya retired from the firm due to her illness. On that date the Balance Sheet of the firm was as follows:
Liabilities / Amt. (Rs) / Assets / Amt. (Rs)General Reserve
Sundy Creditors
Bills Payable
Outstanding Salary
Provision for Legal Damages
Capital:
Himani
Divya
Heena / 12,000
15,000
12,000
2,200
6,000
46,000
30,000
20,000
1,43,200 / Bank
Debtors 6,000
Less: Prov. 400
Stock
Furniture
Premises / 7,600
5,600
9,000
41,000
80,000
1,43,200
Additional Information:
i) Premises to be appreciated by 20%, stock depreciated by 10% and provision for doubtful debts was to be made 5% on debtors. Further provision for legal damages is to be made for Rs. 1,200 and furniture to be brought up to Rs. 45,000.
ii) Goodwill of the firm to be valued at Rs. 42,000.
iii) Rs. 26,000 from Divya’s account to be transferred to her lone account and the balance be paid through bank, if required, necessary loan may be obtained from bank.
iv) New profit sharing ratio of Himani and Heena is decided to be 5:1.
Prepare revaluation account and Partners Capital Account. (6)
Q14. The Balance Sheet of A, B & C sharing profits and losses in the ration of 3:2:1 as on 30th March, 2014, is given below:
Liabilities / Amt (Rs) / Assets / Amt (Rs)Creditors
Investment Fluctuation Fund
Reserve Fund
Capitals:
A
B
C / 50,400
10,000
12,000
30,000
20,000
10,000
1,32,400 / Cash
Stock
Debtors
Investment
Furniture
Building / 3,700
20,100
62,600
16,000
6,500
23,500
1,32,400
The firm was dissolved on that day for the purpose of dissolution investments were valued at Rs. 18,000 and stock at Rs. 17,500. A agreed to take over investments and B took over stock. C took over furniture at the book value. Debtors and building realized Rs. 57,000 and Rs. 25,000 respectively. Expense of realization amounted to Rs. 450. In addition a bill for Rs. 500 under discount was dishonored and taken up by the firm. Prepare necessary ledger accounts to close the books of the firm. (6)
Q15. Pass Journal Entries for the forfeiture and reissue in the following cases:
A) C. Ltd forfeited 600 shares of Rs. 10 each fully called up for non-payment of allotment money of Rs. 3 per share, first call of Rs. 2 and final call of Rs. 2. 400 of these shares were re-issued at Rs. 9 per share, fully paid up.
B) Y. Ltd forfeited 300 shares of Rs. 10 each, Rs. 7 called up for non-payement of first call of Rs. 2. Out of these shares 100 shares were immediately reissued at Rs. 6 per share
(3*2=6)
Q16. Dhoni and Raina were partners sharing profits in the ratio of 3:2. Their Balance sheet on 31st March, 2014 was as follows:
Liabilities / Amt (Rs) / Assets / Amt (Rs)Creditors
Investment Fluctuation Fund
Reserve Fund
Capitals:
Dhoni
Raina / 66,000
5,000
9,000
1,19,000
1,12,000
3,11,000
/ Cash
Debtors 42,000
Less: Prov. for d/d 7,000
Investment (Market price 19,000)
Building
Plant & Machinery / 87,000
35,000
21,000
98,000
70,000
3,11,000
Virat was admitted on that day for 1/6th share on the following terms:
i) Virat will bring in Rs. 56,000 as a share of capital.
ii) Goodwill of the firm is valued at Rs. 84,000 and Virat will bring his share in goodwill of cash.
iii) Plant & Machinery be appreciated by 20%.
iv) All debtors are good.
v) There is a liability of Rs. 9,800 included in creditors that is not likely to arise.
vi) Capital of Dhoni & Raina will be adjusted on the basis of Virat’s capital and any excess or deficiency will be made by withdrawing or bringing in cash.
Prepare revaluation account, Partners’ Capital Account and Balance Sheet of the new firm.
(8)
Q17. X Ltd. Issued for public subscription 40,000 equity shares at Rs. 10 each at a premium of Rs. 2 per share payable as Rs. 4 on application, Rs. 5 on allotment and Rs. 3 on call. Applications were received for 60,000 shares. Allotment was made on pro-rata to the applicants of 48,000 shares. The remaining applications were refused. Money overpaid on application was utilized towards sums due on allotment. Gangadhar to whom 1,500 shares were allotted failed to pay the allotment and call money and Shri. Leeladhar to whom 2,000 shares were allotted failed to pay the call money. These shares were subsequently forfeited. All the forfeited shares were reissued to Mr. Kasana has fully paid up for Rs. 8 per share. Show the Journal Entries to record the above transactions. (8)
Part B
Q18. From the following information calculate resulting cash flow and state the nature of Cash Flow activity:
Paid Rs. 2,50,000 to acquire shares in Optimus Tech. and received a dividend of Rs. 50,000 after acquisition. (1)
Q19. Identify the correct option for Cash Flow from financing activities:
a) Payment of dividend
b) Receipt of dividend on investment
c) Cash received from customers
d) Purchase of fixed asset (1)
Q20. From the following statement of Profit & Loss account of Infotech India Ltd. for the year ending 31st March, 2013 and 31st March, 2014, prepare a Common-Size Statement of Profit and Loss:
Particulars / 31st March, 2014 (Rs.) / 31st March, 2013 (Rs.)Revenue from Operation
Employees Benefit Expenses
Other Expenses / 10,00,000
5,00,000
50,000 / 8,00,000
4,00,000
1,00,000
Analyze the change in profit before tax and Identify the value the firm has shown over the two years. (4)
Q21. From the following information, calculate any two of the following ratios:
i) Net Profit Ratio
ii) Debt-Equity Ratio
iii) Quick Ratio
Information in Rs.:
Paid up Capital 20,00,000
Capital Reserve 2,00,000
9% Debentures 8,00,000
Net Revenue from Operations 14,00,000
Gross Profit 8,00,000
Indirect Expenses 2,00,000
Current Assets 4,00,000
Current Liabilities 3,00,000
Opening Inventory 50,000
Closing Inventory – 20% More than opening Inventory (4)
Q22. Prepare the Balance Sheet of Tuntun Ltd. from the following particulars:
Particulars / Rs.Trade Payables
Provision for Tax
Proposed Dividend
Share Capital
Deferred Tax Liabilities
General Reserve
Balance of Statement of P&L account(Cr.)
Tangible fixed assets
Trade Receivables
Provision for doubtful debts / 1,60,000
40,000
1,20,000
12,00,000
30,000
3,00,000
2,60,000
17,30,000
4,00,000
20,000
(4)
Q23. From the following Balance Sheets of X. Ltd. prepare Cash Flow Statement:
Particulars / Note No. / 31st March 2014 (Rs.) / 31st March 2013 (Rs.)I. EQUITY AND LIABILITIES
1. Shareholders’ Funds
a) Share Capital
b) Reserve and Surplus
2. Non-Current Liabilities
Long Term Borrowings:
10% Debentures
3. Current Liabilities
a) Short-term Borrowings(Bank overdraft)
b) Trade Payables
c) Short-term Provisions
Total
II. ASSETS
1. Non-Current Assets
Fixed Assets
2. Current Assets
a) Trade Receivables
b) Inventories
c) Cash and Cash Equivalents
Total / 1
2
3
4 / 2,00,000
6,400
14,000
13,600
22,000
20,000
2,76,000
1,50,000
48,000
71,000
7,000
2,76,000 / 1,80,000
6,000
12,000
25,000
24,000
16,000
2,63,000
1,60,000
40,000
60,600
2,400
2,63,000
Notes to Accounts
Particulars / 31st March 2014 (Rs.) / 31st March 2013 (Rs.)1. Share Capital
Equity Share Capital
12% Preference Share Capital
2. Reserves and Surplus
General Reserve
Surplus, (Balance in Statement of P&L)
3. Short-term Provisions
Provision for Tax
Proposed Dividend
4. Fixed Assets
Cost
Less: Accumulated Depreciation
/ 1,80,000
20,000
2,00,000
4,000
2,400
6,400
8,400
11,600
20,000
1,80,000
30,000
1,50,000 / 1,55,000
25,000
1,80,000
4,000
2,000
6,000
6,000
10,000
16,000
1,82,000
22,000
1,60,000
Additional Information:
1. Fixed assets sold for Rs. 10,000, cost Rs. 20,000 and accumulated depreciation till date of sale Rs. 6,000.
2. Interim Dividend paid during the year Rs. 9,000.
3. Tax Paid Rs. 7,000 (6)