ACCOUNTS TEST PAPER NO. 5

Q1. Answer the following

1. A person who accepts the bill.
2. The balance which cannot be recovered from the debtors.
3. A person who endorses the bill.
4. Reputation of a firm expressed in terms of money. 
5. What is the due date of bill drawn in 23^rd November, 2010 for a period of 2 months?  

6.      What is goodwill?

Q2. M/s XYZ partnership firm earned net profit during the last four years were Rs, 7,000. Rs, 13,000. Rs, 12,000 and Rs, 8,000. The capital investment made in the firm was Rs, 50,000. N.R.R on capital is 15%. The remuneration of the partners during the period is Rs, 500 p.a. Good will is valued at 2 Yrs purchase of Average super profit of the above mentioned years.

Q.3. Good will is valued at three years purchase of last five years average profit. The profits for the last five years are.    

1st Year	4,800(p)
2nd Year	7,200(L)
3rd Year	10,000(L)
4th Year	3,000(P)
5th Year	5,000(L)

Q4. Drawer: Yamini Gupta, Sarvapriya Vihar, Delhi

Drawee – Kamini Sharma, Raj baug, Agra.

Period – 100 days.

Term – After acceptance

Date of Bill – 1^st January, 2007

Amount – Rs. 10,500/-

Date of Acceptance – 3^rd January, 2007

Q5. Journalise the following transactions in the books of Ashwin.

·        Bank informed that Sachin’s acceptance for Rs. 5,750 sent to bank for collection had been honoured and bank charges debited were Rs. 50.

·        Nitin renewed his acceptance for Rs. 7,200 by paying Rs. 2,200 in cash and accepting a new bill for the balance plus interest @8% p.a. for 3 months.

·        Discharged our acceptance to Pravin for Rs. 4,250 by endorsing Bhavin’s acceptance to us for Rs. 4,000.

·        Jatin who had accepted Ashwin’s bill of Rs. 8,500 was declared insolvent and only 40% of the amount due could be recovered from his estate.

Q6. Mahendra sold goods to Ravindra worth Rs. 6000 and for that Ravindra accepted a bill drawn by Mahendra for 3 months. After a month Mahendra discounted the bill with his bank at 10 % p.a. On the due date Ravindra dishonoured his acceptance. Ravindra paid Rs.3, 000 to Mahendra and accepted a fresh bill for 3 months for the balance including interest @ 8% p.a. Before Maturity of the Bill Ravindra become insolvent and 50 paise in a rupee was discovered from his estate as first and final dividend. Give Journal entries in the books of Mahendra.

Q7. M/s Philips company purchased Machinery worth Rs. 2, 00,000 on 1^st April, 2006. Accounting year of the Company closes on 31^st March every year. Company provides depreciation at 10% p.a. on the written down value. On 31^st March, 2008 the machinery was sold for Rs. 1, 20,000. Give the machinery Account  and depreciation Account for two years.