HSC ACCOUNTS MODEL PAPER FOR BOARD EXAM NO. 5

AS PER NEW SYLLABUS 

MARKS: 80 MARKS

Q1. Attempt any THREE of the following.                                            (15 marks)

A. Answer in one sentence only: (5 MARKS)

          

  (1)        What is Partnership Deed?

Ans:     A partnership deed is a written agreement duly stamped, signed and registered document containing the terms and conditions of the partnership.

(2) What is Bill of Exchange?

Ans. A bill of exchange is a negotiable instrument containing an unconditional order signed by the maker directing a certain person to pay a certain sum of money only to the bearer of the instrument.

(3)        What do you mean by Scrap Value of an asset?

Ans:     The net amount which is expected to be realised on the final disposal of a fixed asset is called ‘scrap value’.

  (4)        What are Noting Charges?

Ans:     Noting charges are the fees charged by the Notary Public for noting the dishonour on the face of the bill and in his official register.

(5) What is Single Entry System?

Ans. It is an unscientific system of recording transactions where only one aspect of the transaction is recorded.

B. Write the word / Term / Phrase which can substitute each of the following statement:

1. A person who draws a bill of exchange. (Drawer)

2. Winding up of partnership business. (Dissolution of partnership firm)

3. The credit balance of Profit and Loss Account.  (Net Profit)

4. An excess of assets over liabilities. (Capital)

5. The account which shows change in the values of assets. (Revaluation Account)

C. Select the most appropriate alternative from the given below and rewrite the statement:  (5 MARKS)

1. There are ______ parties to a bill exchange. (Three)

a. Three            b. Two  c. Four d. Five

2. In case of dissolution assets and liabilities are transferred to ____ account. (Realisation)

a. Bank b. Partner's Capital        c. Realisation    d. Partner's Current.

3. When goodwill is withdrawn by old partners _________ Account is credited. (Cash or Bank)

a. Cash or bank b. Capital          c. Revaluation   d. Profit and Loss adjustment.

4. Generally incomplete records are maintained by ______ (Trader)

a. Trader           b. Company      c. Society                     d. Government 

5. Excess of income over expenditure is termed as _____(Surplus)

a. Deficit,          b. Profit            c. Surplus         d. Loss

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

1. Single entry system is based on certain rules and regulations. (False)

2. Not for profit concern do not have profit motive.  (True)

3. Bill of exchange is an instrument in writing, containing an unconditional order. (True)

4. A bill of exchange is signed by the person on whom it is drawn. (True)

5. Realisation loss is not transferred to insolvent partner's capital account. . (False)

E. Prepare bill of exchange from the following details.    (5 marks)

           Drawer -                                   Shekhar Desai, Shastri Road, Mahad.           

Drawee –                                   Sharad Verma, Narayan Peth, Pune.    

Amount -                                    Rs. 3500/-

Period -                                      3 months.

Payee -                           Mukund Pande, Panvel

Date of Bill Drawn –      21st June, 2007

Date of Acceptance -     23^rd June, 2007

Q2. Following is the records of Mr. Raj were kept on single entry system. ( March 2009 board exam questions)

Particulars	31.3.2006	31.3.2007
Stock Furniture Plant and machinery Loan taken Bank balance Debtors Creditors	15000 53500 42500 21000 1900 43000 18000	14000 44000 55500 21000 2100 35000 14900

Mr. Raj invested Rs. 4000 in the business. Also he had withdrawn Rs. 15000 for his private expenses from business. Rs. 500 to be provided for bad debts. Depreciate plant and machinery @5% and furniture @ 5%.

Prepare : (1) statement of affairs as on 31.3.2006. (2) statement of affairs as on 31.3.2007. (3) statement of profit and loss for the year ended on 31.3.2007.

In the books of Mr. Raj

Statement of affairs as on 31^st March, 2006

Liabilities	Amount	Assets	Amount
Loan taken Creditors Capital at the beginning of the year	21000 18000 116900	Stock Furniture Plant and machinery Bank balance Debtors	15000 53500 42500 1900 43000
	155900		155900

Statement of affairs as on 31^st March, 2007

Liabilities	Amount	Assets	Amount
Loan taken Creditors Capital at the end of the year	21000 14900 114700	Stock Furniture Plant and machinery Bank balance Debtors	14000 44000 55500 2100 35000
	150600		150600

Statement of profit or loss for the year ended 31^st March, 2007

Particulars	Amount
Capital at the end of the year	114700
Add: Drawings	15000
Less: Additional capital introduced	129700 (4000)
Less: Capital at the beginning of the year	125700 (116900)
GROSS PROFIT Less: Depreciation On Machinery = (55000)(5/100)(12/12) = 2775 On Furniture  = (44000)(5/100)(12/12) = 2200	8800 (4975)
LESS: BAD DEBTS	3825 (500)
NET PROFIT	3325

OR

Q2. A. State the Objectives of Analysis of Financial Statements.(4)

(B) What is Cash Flow Analysis? (4)

Q3. The Balance Sheet of Rajkumar and Rajendra kumar as on 31st March, 2012 is set out below, they share profits and losses in the ratio of 2:1.
Balance sheet as on 31st March, 2012

Liabilities	Amount Rs.	Assets	Amount Rs.
Capital A/c Rajkumar Rajendrakumar General Reserve Creditors	200000 150000 120000 80000	Buildings Furniture Stock Debtors Cash Profit and Loss A/c	100000 30000 60000 300000 30000 30000
	550000		550000

They agreed to admit Dhirajkumar on 1st April, 2012 as a partner into the firm on the following terms.

1.    Dhirajkumar to bring Rs. 60000 as capital and Rs. 45000 as goodwill, which is to be retained in the business. He will be entitled to 1/4 th share of profit of the firm.

2.    50% of General Reserve is to remain as Reserve for doubtful debts.

3.    Furniture is to be depreciated by 5%

4.    Stock is to be revalued at Rs. 65,000.

5.    Creditors of Rs. 5000 are not likely to claim and hence should be written of.

6.    Rent of Rs. 2,000 due but not received has not been recorded in the books.

Pass necessary journal entries in the books of new firm and prepare Balance sheet of the new firm.

Solution:

1. Rajkumar’s Capital A/c.........                Dr.       2000
   Rajendrakumar’s Capital A/c               Dr.       1000
            To Proft and Loss A/c                                           3000
[Being debit balance of Profit and Loss Accopunt is transfered to
Partners Capital Account in old ratio]

2. General Reserve A/c ....... Dr.                           60,000
            To Rajkumar’s Capital A/c                                   40000
            To Rajendrakumar’s Capital A/c                                    20000
[Being Credit Balance in General Reserve Account is transfered to
Old Partners Capital ACcount]

3. Cash / Bank A/c ......... Dr.                                             105000
            To Dhirajkumar’s Capital A/c                              60000
            To Goodwill A/c                                                      45000
[Being Capital and Goodwill brought in by new partner]



4.Goodwill A/c ....... Dr.                                           45000
            To Rajkumar’s Capital A/c                                   30000
            To Rajendrakumar’s Capital A/c                        15000
[Being Goodwill is retained in the business]



5. General Reserve A/c ..... Dr.                             60000
            To R.D.D. A/c                                                                       60000
[Being R.D.D. is created by transferring fund from General Reserve A/c )

6. Revaluation A/c ..... Dr.                                      1500
            To Furniture A/c                                                     1500
[Being depreciation is charged on furniture]



7. Stock A/c .... Dr.                                                  5000
   Creditors A/c ..... Dr.                                            5000
`   Rent receivable A/c .... Dr.                                            2000
            To Revaluation A/c                                                            12000
[Being Asset appreciated, Creditors written off and income receivable recorded.]



8. Revaluation A/c ..... Dr.                                      10500
            To Rajkumar’s Capital A/c                                               7000
            To Rajendrakumar’s Capital A/c                                    3500
[Being Profit on revaluation account is transferred to old partners capital A/c]




1. Working Note



Revaluation A/c

Debit	Credit
1500	12000
10500
12000	12000

OR

Sanil, Nitish, Sapna were partners in a firm sharing profits and losses in the proportion of 1/2 , 1/3, 1/6 respectively. Their Balance Sheet as on 31st March, 2012 was as follows:

Balance Sheet as on 31 - 03 - 2012

Liabilities	Amount	Assets	Amount
Bills Payable Capitals: Sanil Nitish Sapna	30000 80000 50000 30000	Machinery Furniture Sundry Assets Stock Debtors Bank	40000 5000 60000 30000 32000 23000
	190000		190000

Sapna decided to retire on 1st April, 2012 on following terms:

1. Goodwill of the firm will be valued at Rs. 30,000.

2. Furniture war taken over by Sanil for Rs. 4,700.

3. Make a Provision for unpaid expenses Rs. 1,700.

4. Out of the amount due to Sapna Rs. 7,500 to be paid by cheque and the remaining amount to be transferred to her loan account.

Prepare Profit and Loss Adjustment Account, Partners’ Capital Accounts and Balance sheet of New firm on 1st April, 2012.

4. Anjali of Nagpur sold goods worth Rs. 25,000 to Rupali of Amaravati. On next day Ruapali paid Rs. 10,000 in cash and accepted two months bill for the balance drawn by Anjali. Anjali discounted the bill at 12% p.a. with her bank. Before due date, Rupali finds herself unable to make payment of the bill; and requests Anjali to renew it. Anjali accepts the proposal on the condition that Rupali should pay Rs. 5,000 in cash and accept new bill for one month along with interest Rs. 200 for the balance. These arrangements were carried through. The new bill was met on due date. Give journal entries in the books of Anjali.

Journal of Anjali

Date	Particulars	L F	Debit	Credit
? 1	Rupali’s A/c………Dr.   To Sales A/c (Being the goods are sold)		25000	25000
2	Cash / bank a/c ………Dr Bills Receivable A/c ……… Dr.     To Rupali’s A/c (Being the part payment is made and bill is drawn)		10000 15000	25000
3	Cash/ Bank A/c ……… Dr. Discount A/c ………… Dr.   To Bills Receivable A/c (being the bill is discounted)		14700 300	15000
4	Rupali’s A/c ……… Dr   To Cash/Bank A/c (being the bill is dishonored)		15000	15000
5	Cash/ bank a/c………… Dr  To Rupali’s A/c (being the part payment is made)		5000	5000
6	Rupali’s A/c ……… Dr.   To Interest a/c (being the interest is charged on balance amount)		200	200
7	Bills Receivable A/c ………… Dr.   To Rupali’s A/c (being the new bill is drawn along with interest)		10200	10200
8	Cash/ bank a/c ……… Dr.  To Bills receivable a/c (being the new bill is honored)		10200	10200

Q5. X and Y are equal partners. 

The following is their Balance Sheet as on 31st March, 2012.

Liabilities	Rs.	Rs.	Assets	Rs.	Rs.
X’s Capital Y’s Capital Reserve Fund X’s Loan Creditors		40000 30000 8000 2000 15000	Building Machinery Furniture Debtors Less: R.D.D. Stock Investments Commission Receivable Bank	8800 - 800	30000 10000 12000 8000 20000 4000 1000 10000
		95000			95000

The firm was dissolved on 31st March, 2012

(i) The Assets realised as follows:

Stock Rs. 19,000, Debtors Rs. 7,500, Machinery Rs. 11,000, Building Rs. 14,000

ii. Y took over the investments Rs. 5000 and Furniture at Book Value.

iii. X agreed to accept Rs. 1500 in full settlement of his Loan Account.

iv. Dissolution expenses amounted to Rs. 2000.

v. Commission Receivable could not be recovered.

Prepare Realisation Account, X’s Loan Account, Capital Accounts and Bank Account.

Solution:

Realisation Account

Particulars	Rs.	Rs.	Particulars	Rs.	Rs
To Sundry Assets			By Sundry Liabilities
Building	30000		Creditors		15000
Machinery	10000		By R.D.D. A/c		800
Furniture	12000		By Bank A/c
Debtors	8800		Stock	19000
Stock	20000		Debtors	7500
Investments	4000		Machinery	11000
Commission Receivable	1000	85800	Building	14000	51500
To Bank A/c		2000	BY Y’s Capital A/c
(Dissolution Expenses)			Investments	5000
To Bank A/c			Furniture	12000	17000
Creditors		15000	By X’s Loan A/c		500
			By Loss on Realisation A/C
			X	9000
			Y	9000	18000
		102800			102800

Partners Capital Account

Particulars	X	Y	Particulars	X	Y
To Realisation A/c		17000	By Balance b/d	40000	30000
To Realisation A/c (loss)	9000	9000	By Reserve Fund (1:1)	4000	4000
To Bank A/c	35000	8000
	44000	34000		44000	34000

X’s Loan Account

Particulars	Rs.	Rs.	Particulars	Rs.	Rs
To Bank A/c		1500	By Balance b/d		2000
To Realisation A/c		500
		2000			2000

Bank Account

Particulars	Rs.	Rs.	Particulars	Rs.	Rs
To Balance b/d		10000	By Realisation A/c		2000
To Realisation A/c		51500	By Realisation A/c		15000
			By X’s Loan A/c		1500
			By X’s Capital A/c		35000
			By Y’s Capital A/c		8000
		61500			61500

Q6. From the following Receipt and Payment account of Patan Sports Association, Patan and the adjustments. You are required to prepare Income and Expenditure Account for the year ended 31^st March, 2004 and a Balance sheet as on that date.    (16)

            Receipts and Payments Account for the year ended 31^st March 2004.

Receipts	Amt. (Rs.)	Payments	Amt. (Rs.)
To Balance b/d	4,160	By Salaries	5,500
To Subscription:		By Entertainment Exp.	2,580
2003-04                16,000		By Lighting	1,000
2004-05                     412	16,412	By General Expenses	1,536
To Donation	2,000	By Taxes	500
To Receipt from Entertainment	3,644	By Investments	12,000
To Interest on Investment	324	By Printing & Stationery	944
To Entrance Fees	4,500	By Expenses of 2002-03	2,400
To Price Fund	3,000	By Fixed Deposit	4,000
		By Bank Balance	3,000
		By Balance c/d	580
	34,040		34,040

Adjustments:

(1)           There are 450 members paying an annual subscription of Rs. 40 each.

(2)           Salary outstanding on 31^st March, 2004 was Rs. 1,000.

(3)           Building stood in books Rs. 60,000 and furniture at Rs. 4,600 on 1^st April, 2003. Write off depreciation on these assets @ 2% and 10% respectively.

(4)           Interest on investment @ 5% has accrued for 3 months.

(5)           The capital fund was Rs. 66,360 on 1^st April, 2003.

(6)           60% of the entrance fee is to be capitalised.

Income & Expenditure A/c for the years ended 31-3-2004

Expenditure	Rs.	Rs.	Income	Rs.	Rs.
To Entertainment Exp. To Salaries Add: Outstanding To Lighting To General Expenses To Taxes To Printing & Stationery To Depreciation      Building      Furniture To Surplus	5,500   1,000 1,200     460	2,580 6,500 1,000 1,536 500 944 1,660 11198	By Donation By Receipt from Entertainment By Interest on Investment Add: Interest By Entrance Fees Less: Capitalised By Surplus	324    150 4,500   2,700	2,000 3,644 474 1,800 18,000
		25,918			25,918

Balance Sheet as on 31-3-2004

Liabilities	Rs.	Rs.	Assets	Rs.	Rs.
Capital Fund Add: Entrance Fees Add: Surplus Price Fund Outstanding Salary Subscription paid in advance	66,360    2,700 69,060   11198	80258 3000 1000 412	Building Less: Depreciation Furniture Less: Depreciation Investments Add: Interest Fixed Deposit Bank Balance Cash Subscription receivable	60,000    1,200 4,600     460 12,000     150	58,800 4,140 12,150 4,000 3,000 580 2,000
		84670			84670

Q7. Following is the Trial Balance of Kalavati and Lilavati as on 31^st March, 2005 who share profits and losses in the ration of 3:2. Interest on capital was allowed @5% p.a.

Trial balance as on 31^st March, 2005

Particulars	Amount	Particulars	Amount
Opening stock Sundry debtors Purchases Wages Salaries Office expenses Discount Rent, rates and taxes Plant and machinery Return inwards Land and buildings Cash at bank Current account :Kalavati Lilavati Government bonds	10000 14100 20000 4250 1350 1223 650 900 15000 1750 32000 4327 2100 600 3000	Return outwards Sundry creditors Sales R.D.D. Capital accounts : Kalavati Lilavati Loan @ 9% p.a. (taken on 1-10-2004) Bills payable	1250 15800 35000 200 35000 10000 2000 12000
	1,11,250		1,11,250

 Additional information:

1.      Closing stock was valued at Rs. 20,500.

2.      Unpaid wages Rs. 750; outstanding salary Rs. 657.

3.      Write off Rs. 100 as bad debts and provide R.D.D. at 5% on debtors.

4.      Provide depreciation and plant and machinery at 10% p.a. and on Land and building at 5% p.a.

5.      Rent, Rates & Taxes were prepaid Rs. 100.

6.      Bills payable included a dishonoured bill of Rs. 3000.

Prepare Trading account and profit and loss account for the year ending 31^st March, 2005 and a balance sheet as on that date.  (October 2006 board exam questions.)

In the books of Kalavati & Lilavati

Trading account for the year ended 31^st March, 2005.

Particulars	Amount	Amount	Particulars	Amount	Amount
To opening stock To purchases (-)return To wages (+) outstanding To Gross profit c/d	20000 (1250) 4250 750	10000 18750 5000 20000	By sales (-) return By closing stock	35000 (1750)	33250 20500
		53750			53750

Profit and loss account for the year ended 31^st March, 2005

Particulars	Amount	Amount	Particulars	Amount	Amount
To Salaries (+) outstanding To Office expenses To discount To rent, rates & taxes (-) prepaid To Bad debts (+) FBD (+) NRDD (-) ORDD TO Depreciation Plant & machinery Land & buildings To interest on loan To interest on capital Kalavati Lilavati To current a/c Kalavati Lilavati	1350 657 900 100 ----- 100 700 200 1500 1600 1750 500 5568 3712	2007 1223 650 800 600 3100 90 2250 9280	By gross profit b/d		20000
		20000			20000

Partners’ current accounts

Particulars	Kalavati	Lilavati	Particulars	Kalavati	Lilavati
To balance b/d To balance c/d	2100 5218	600 3612	By interest on capital	1750 5568	500 3712
	7318	4212		7318	4212

Balance sheet as on 31^st March, 2005

Liabilities	Rs.	Rs.	Assets	Rs.	Rs.
Capital account Kalavati Lilavati Current account Kalavati Lilavati Sundry creditors (+) bills payable dishonoured Bills payable (-) bills payable dishonoured Outstanding Salaries Wages Load @ 9% (+) interest	35000 10000 5218 3612 15800 3000 12000 3000 657 750 2000 90	45000 8830 18800 9000 1407 2090	Land & building (-) depreciation@5% Plan & Machinery (-) depreciation @10% Sundry debtors (-) F.B.D. (-) N.R.D.D. Closing stock Prepaid rent, rates, & tax Cash at bank Government bonds	32000 1600 15000 1500 14100 100 14000 700	30400 13500 13300 20500 100 4327 3000
		85127			85127