OMTEX CLASSES: Book Keeping & Accountancy July 2016 Board Paper

Book Keeping & Accountancy July 2016 Board Paper

Book Keeping & Accountancy

July 2016 Board Paper

Q. 1. A. Answer the following questions in one sentence each. [5]

(1) What is Trial Balance?

Ans. Trial balance is a statement showing the list debit and credit balances of all the ledger accounts on a particular date.

(2) What shows credit balance of revaluation account?

Ans. Profit on Revaluation Account.

(3) What are ‘convertible debentures’?

Ans. Convertible Debentures; - Convertible Debentures are those which can be converted either partly or wholly into equity shares after the completion of a definite period. The rate of interest and date of conversion is decided at the time of issue. The interest is paid up to the date of conversion. On conversion the debenture holders are eligible for dividends and other rights and privileges of shareholders.

(4) Who is ‘Payee’?

Ans. Payee is the person or party to whom the amount of bill is made payable.

(5) What is single entry system?

Ans. A bookkeeping system that only records one aspect of each business transaction. i.e. either debit or credit is called single entry system.

(B) Write a word / term / phrase which can substitute each of the following statements: (5)

(1) The accounts which are prepared at the end of each financial year.

Ans. Trading and Profit and Loss Account.

(2) The fees paid by a person who wants to become a life member of the concern, for his whole life.

Ans. Life membership fees.

(3) The acknowledgement of debt under common seal of company.

Ans. Debenture Certificate

(4) Payment of the bill before its due date.

Ans. Retirement of Bill.

(5) Critical evaluation of financial statement to measure profitability.

Ans. Analysis of financial statement

(1) All indirect expenses are debited to ____________ account.

(a) Trading

(b) Capital

(d) Current

(2) Share of profit of a deceased partner till the date of death is ____________

(a) debited to profit and loss adjustment account.

(b) credited to profit and loss adjustment account.

(d) credited to profit and loss suspense account.

(3) If any asset is taken over by a partner from the firm, his capital account will be ______________

(a) credited

(b) debited

(d) none of these

(4) There are ____________ parties to the Bill of Exchange.

(a) two

(b) three

(d) five

(5) Further capital introduced during the year is _________ from closing capital in order to find out the correct profit.

(a) added

(b) deducted

(d) ignored

(D) State whether the following statements are True or False. (5)

(1) All receipts are the items of revenue income. [False]

(2) At the time of dissolution loan from partner will be transferred to realisation account. [False]

(3) A Bill of Exchange is a negotiable instrument. [True]

(4) Acceptance without making any change in the terms of bill is called general acceptance. [True]

(5) Ratio analysis is useful for inter - firm comparison. [True]

(E) Prepare a specimen of Bill of Exchange from the following information: (5)

Shri Arjun Patil, 104, Shivaji Nagar, Ambajogai draws a two months bill on Shri Tukaram Magdum, Daulat Road, Halkarni, Kolhapur payable to Shri Ranveer Patil, Mondha, Parali Vaijanath on 23 rd August, 2013 for Rs. 7550. Shri Tukaram Magdum accepted it on 28th August, 2013 for Rs. 7500 only.

Answer:

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Q. 2. Mrs. Shailaja keeps her books under single entry system and gives the following information. (8)

Particulars	1.4.2012	31.3.2013
	Amount (Rs. )	Amount (Rs.)
Investments		12000
Bank overdraft		10000
Bills payable	5000	8000
Creditors	26500	31500
Furniture	9000	19000
Debtors	35000	50000
Stock	15000	19000
Bank Balance	18000	28000

Further information:

(1) Mrs. Shailaja withdrew Rs. 4000 for her personal use. She received Rs. 15,000 from her father as gift, which she brought into the business.

(2) Additional furniture was purchased on 01.10.2012. Depreciate furniture by 10% p.a.

(3) Write off Rs. 1,000 as bad debts and provide 5% R.D.D. on debtors.

Prepare: Opening and closing statement of affairs and statement of profit or loss for the year ended 31st March, 2013.

Solution: [ Click Here for Anwers ]

(A) Explain the limitations of analysis of financial statements.

Ans. [Click Here for Answer]

(B) Explain the operating activities on cash flow.

Ans. [Click Here for Answer]

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Q. 3. Following is the balance sheet of Harish and Girish:

Balance Sheet as on 31st March, 2010

Liabilities	Amt.	Amt.	Assets	Amt.	Amt.
Creditors		38000	Cash in Hand		37000
Bills Payable		46000	Stock		21000
Profit & Loss A/c		16000	Debtors	46000
Capital A/c			(-) R.D.D.	-6000	40000
Harish	100000		Equipments		12000
Girish	140000	240000	Furniture		25000
			Plant		85000
			Buildings		120000
		340000			340000

They admitted Shirish on 1st April, 2010 on the following conditions:

1. For his 1/3 rd share in the future profits, Shirish brings Rs. 2,00,000 as his capital.

2. It is decided to raise goodwill by Rs. 90,000 and write off fully after Shirish Admission.

3. Equipments and Plant are to be depreciated by 20% and 10 % respectively and Building is to be appreciated by 15%.

4. Bills Payable were retired for Rs. 35,000.

5. All debtors are to be considered good.

6. Furniture of the book value Rs. 12,000 was taken over by Harish at 40% of the book value.

Prepare, Revaluation A/c. Partners' Capital A/c and Balance Sheet of the new firm.

Solution: [Click Here for Answer]

Anita, Sunita and Kavita were partners sharing profits and losses in the ratio 3:3:2. Their Balance Sheet as on 31st March 2013 is as below:

Balance Sheet as on 31st March, 2013.

Liabilities	Amount (Rs.)	Assets	Amount (Rs.)
Capital Accounts		Building	10000
Anita	11000	Machinery	10700
Sunita	15000	Furniture	10000
Kavita	8000	Debtors	5000
Creditors	10000	Stock	6600
Reserve fund	4000	Cash	6600
	48900		48900

On 1st April, 2013, Mrs. Kavita retired from the firm on the following terms:

(1) Goodwill of the firm is to be valued at Rs. 4,000, however, only Kavita’s share in it is to be raised in the books and written off immediately.

(2) Assets to be revalued as under:

Stock Rs. 6,300; Machinery Rs. 10,000; Furniture Rs. 10,200.

(3) R.D.D. to be maintained at 10% on debtors.

(4) Rs. 100 to be written off from creditors.

(5) The amount payable to Mrs. Kavita is to be transferred to her loan account.

Prepare :

(1) Profit and loss adjustment account.

(2) Partner’s capital account, and

(3) Balance Sheet of new firm as on 01.04.2013.

Q.4. Journalise the following transactions in the books of Jaydeep. [10]

(A) Arvind renews his acceptance of Jaydeep of ` 7,000 with interest ` 500 for two months.

(B) Bank informed Jaydeep that Mahadev’s acceptance of ` 4,000 which was discounted and

dishonoured. Bank charged noting charges ` 80.

(C) Hanumant informed Jaydeep that Kazi’s acceptance for ` 7,000 endorsed to Hanumant has been dishonoured, noting charges `85.

(D) Datta honoured his acceptance of `4,900, which was sent to bank for collection. Bank debited ` 100 for bank charges.

(E) Radhika retired her acceptance to Jaydeep of ` 9,000 by paying ` 8,700.

Answer: [Click Here For Journal Entries]

Q5. Rahul, Rohit and Ramesh were partners in a firm sharing profits and losses in the ratio of 2:2:1 respectively. The Balance Sheet as on 31.03.2013 was as follows: [10]

Balance Sheet as on 31st Mar, 2013

Liabilities	Amount (Rs. )	Assets	Amount (Rs.)	Amount (Rs.)
Sundry Creditors	20000	Cash at Bank		8000
Bills Payable	5000	Debtors	16000
General Reserve	6000	Less: R.D.D.	-1000	15000
Rahul’s Loan A/c	16000	Stock		20000
Capital Account		Plant and Machinery		30000
Rahul	25000	Furniture		6000
Rohit	10000	Ramesh’s Capital Account		3000

	82000			82000

The firm was dissolved on the above date:

(1) Assets realised as follows:

Debtors Rs. 9,000, Plant and Machinery Rs. 26,000, Stock Rs. 14,000, and Furniture Rs. 3,000.

(2) The creditors were paid Rs. 18,000, in full settlement and the bills payable were paid in full.

(3) The realisation expenses amounted to Rs. 3,000.

(4) Ramesh became insolvent and was able to bring in only Rs. 1,800 from his private estate.

Prepare:

(1) Realisation account

(2) Partner’s capital account and

(3) Bank account.

Solution: [Click Here for Answers]

Q5. Mahakali Co. Ltd. Chandrapur issued 1,000, 12% debentures of ` 100 each, payable ` 20 on application and the balance on allotment. Applications were received for 1,500 debentures, out of which, applications for 900 were allotted fully, applications for 400 were allotted 100 debentures and remaining were rejected. All dues received.

Journalise the transactions and also show Balance Sheet.

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Q. 6. Following is the receipts and payments account of Chamber of Commerce, Chandgad for the year ending 31.03.2013 and some additional information. You are required to prepare the Income and Expenditure Account for the year ending 31.03.2013 and Balance Sheet as on that date.

Receipts and Payment Account for the year ending 31.03.2013

Receipts	Amount (Rs.)	Payments	Amount (Rs.)
To Balance b/d (Cash at Bank)	11960	By Printing & Stationery	6950
To Subscriptions (including Rs. 2,500 For 2011-2012)	36,500	By Repairs	2,100
To Sale of Furniture (Book value Rs. 18,000)	12,000	By Rent	8,500
To Donations	27000	By Books	20000
To Admission Fees (Revenue)	5050	By Travelling Expenses	2000
		By Investments	40000
		By Insurance	1700
		By Balance c/d [Cash at Bank]	11200


	92510		92510

Additional Information:

Particulars	01.04.2012 Amount	31.03.2013 Amount
Outstanding Subscriptions Furniture Building fund Capital fund Investments	3,000 32,000 1,45,000 1,51,960 2,50,000	5,000 ? ? ? ?

(2) Neglect depreciation on the part of furniture sold during the year, but depreciate the remaining furniture by Rs. 1,000.

(2) Donation is received for building fund.

Solution: [Click Here for Answers]

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Q7. Dhiraj and Suraj are partners sharing profits and losses in the ratio of 2:1. From the following Trial Balance and adjustments, prepare Trading and Profit and Loss account for the year ended 31st March, 2013 and balance sheet as on that date:

Trial Balance as on 31.03.2013

Particulars	Amount Rs.	Particulars	Amount Rs.
Opening Stock Purchases Plant and Machinery Furniture Carriage Wages Bills Receivable Sundry Debtors Conveyance Salaries Cash in hand Land and Building Bad debts Patents	32,000 64,000 30,000 18,500 1,500 30,000 5,000 32,000 4,000 10,500 14,750 83,500 1,750 25,000	Sales Sundry Creditors Return Outward Capital Accounts’ Dhiraj Suraj	1,93,500 16,500 2,500 90,000 50,000
	352500		352500