Reference no: EM131335000
Note: Answer all questions. Kindly note that answers for 10 marks questions should be approximately of 400 words. Each question is followed by evaluation scheme.
Question1 - 1 X, Y & Z were partners sharing profits and losses as 3:2:1. Their Balance Sheet as on 31.03.2015 were as under :
|
Liabilities
|
Rs.
|
Assets
|
Rs.
|
|
Capital
A 1,00,000
B 70,000
C 40,000
|
1,80,000
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Freehold Premises
Building
Machinery
|
1,60,000
60,000
90,000
|
|
Reserves
|
90,000
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Investments
|
20,000
|
|
Cash Credit
|
30,000
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Inventories
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30,000
|
|
Creditors
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20,000
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Receivables
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30,000
|
|
Bill Payable
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20,000
|
Cash
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10,000
|
|
|
3,40,000
|
|
3,40,000
|
C expired on 1st April 2015. So, the assets are revalued and liabilities re-assessed as follows :
i) Create a provision for doubtful debt Rs. 1,000. ii) Building is to be depreciated by 5 %. iii) Machinery is to be depreciated by 10 %. iv) Goodwill of the firm is to be valued at Rs. 30,000.
The balance due to C will be transferred to his executor's loan account which will carry an interest of 10 % p.a. Prepare Revaluation Account, Capital Accounts and the Balance Sheet of new firm after adjustments.
Based on above, prepare :
a) Revaluation Account
b) Capital Accounts and
c) Balance Sheet as on 1st April 2015
Question2- The Cash Book of Exception Ltd. furnishes the following balances on 25th October 2015. Cash in hand 4,200; Cash at Bank 7,650; Discount Allowed total 420 and Discount Received total Rs. 950.
The following transactions occurred during last week of October 2015 :
April 26 : General expenses Rs. 920 paid in cash
26 : Cash Sales Rs. 9,200
27 : A cheque Rs. 3,040 received from a debtor, K. Ball in full settlement of Rs. 3,200.
27 : A cheque sent to supplier, Baker Ltd. in settlement of dues Rs. 14,000 less 5 % Discount.
28 : Bank notified that a cheque Rs. 2,210 received from Mc Dermot returned dishonoured.
30 : An old delivery van was sold for Rs. 71,000 and a cheque received.
30 : A cheque sent to a supplier, Ford Ltd. in immediate payment of an invoice, list price Rs. 8,000, less 25 % Trade discount and 5 % Cash discount.
Prepare a Triple Column Cash Book in the books of Exception Ltd.
Question3 - What do you understand by goodwill? Explain the accounting treatment of goodwill at the time of admission. Give journal entry for the below problem: T and S are partners in a firm sharing profit in the ratio 5:3. They admitted G as a new partner for 1/4th share in the profit. G brings Rs.45,000 for her share of goodwill and Rs.1,20,000 for capital. They have withdrawn the goodwill from the firm. Make journal entries in the books of the firm after the admission of G. The new profit sharing ratio will be 2:1:1.
Question4- Accounting refers to a systematic knowledge of accounting. It explains ‘why to do’ and ‘how to do’ of various aspects of accounting. Explain the objectives of accounting and explain the categories of users.
Question5 - Prepare Trading , Profit and Loss Account and Balance Sheet from the following particulars as at 31st March 2015.
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Particulars
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Dr (Rs.)
|
Cr (Rs.)
|
|
Capital/Drawings
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1400
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10000
|
|
Cash in Hand
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1500
|
-
|
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Bank overdraft @ 5%
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-
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2000
|
|
Purchase and Sales
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12000
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15000
|
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Returns
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1000
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2000
|
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Establishment Charges
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2500
|
-
|
|
Taxes and Insurance
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500
|
-
|
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Provision for Doubtful Debts
|
-
|
1000
|
|
Bad Debts
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500
|
-
|
|
Sundry Debtors & Creditors
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5000
|
1850
|
|
Commission
|
-
|
500
|
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Investments
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4000
|
-
|
|
Stock on 1st April 2014
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3000
|
-
|
|
Furniture
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600
|
-
|
|
Bill receivables & payable
|
3000
|
2500
|
|
Collected Sales Tax
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-
|
150
|
|
|
35000
|
35000
|
Further, you are required to take into consideration the following information:
a) Salary Rs.100 and taxes Rs.400 are outstanding but insurance Rs.50 prepaid
b) Commission amounting to Rs.100 has been received in advance for work to be done next year.
c) Interest accrued on investments Rs.210
d) Provision for doubtful Debts is to be maintained at 20%
e) Depreciation on furniture is to be charged at 10% p.a.
f) Stock on 31st March 2015 was valued at Rs.4,500
g) A fire occurred on 25th March 2015 in the godown and stock of the value of Rs.1,000 was destroyed. It was fully insured and the insurance company admitted the claim in full.
Question6- From the ledger balances as on 31st March 2015 show treatments in Profit and Loss Account and in Balance Sheet.
Debtors : 50,000; Bad Debts : 3,000; Discount Allowed : 2,000; Creditors: 30,000; Provision for Discount on Creditors : 400; Discount Received 300.
Adjustments :
i) Create a provision for Bad Debts @ 10 % on Debtors
ii) Create a provision for Discount on Debtors @ 5 %
iii) Additional discount given to Debtors Rs. 1,000
iv) Create a provision for discount on Creditors @ 2 %.
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