iy SAMPLE PAPER Fe iienta ra) Time Allow Hours} [Maximum Marks: 80 General Instructions: 1. This question paper contains 34 questions. All questions are compulsory. 2. This question paper is divided into two parts, Part A and B. 3. Part-A is compulsory for all the candidates. 4. Part-B has two options ie. (7) Analysis of Financial Statements and (i?) Computerised Accounting, Students must attempt only one of the given options as per the subject opted. 5. Question Nos. 1 to 16 and 27 to 30 carry 1 mark each. 6. Question Nos. 17 to 20, 31 and 32 carry 3 marks each. Question Nos. 21, 22 and 33 carry 4 marks each. Question Nos. 23 to 26 and 34 carry 6 marks each. There is no overall choice. However, an internal choice has been provided in 7 questions of one mark, 2 questions of three marks, 1 question of four marks and 2 questions of six marks. fam PART - A Accounting for Partnership Firms and Companies 1. ABN Lid. issued 20,000, 6% Debentures of & 100 each at a discount of 5% on 1 January, 2024. Interest for the year ended 31st March, 2024 will be: (@) & 60,000 (6) % 45,000 (©) € 30,000 (a) = 90,000 2. Assertion (A): When a new partner is admitted, partnership firm remains continuous. The old partnership comes fo an end and a new partnership agreement comes into existence. Reason (R): At the time of admission of a partner, the partnership firm dissolves. (a) Both (A) and (R) are true, and (R) is the correct explanation of (A). (b) Both (A) and (R) are true, but (R) is not the correct explanation of (A). (©) (A) is true bat (R) is false. (d) (A) is false and (R) is true. 3. Shalini Ltd. issued 40,000, 10% Debentures of % 100 each at certain rate of discount and were to be redeemed at Par. Securities Premium of % 1,50,000 and Current year profit of % 50,000 were used to write off Discount on Issue of Debentures. What is the rate of issue per debenture? (@) 5% () 10% ©) 95% (2) 6% Or Accounts Guru Ltd. issued 40,000, 11% Debentures of 7 100 each at 10% premium and to be redeemed at a certain rate of premium, At the time of writing off Loss on Issue of Debentures, ‘Statement of Profit and Loss was debited with 7 2,00,000. At what rate of premium, these debentures are redeemed? (a) 11% (b) 10% () 3% (a) 18% Sample Papers {4 }4, Rahul, Samarth and Ayaan were partners sharing profits and losses in the ratio of 5:43. Ayaan’s fixed Capital balance as on March 31, 2024 was € 2,70,000. Which of the following items would have affected this Capital balance? (a) Profit/Loss for the year (6) Additional Capital introduced (c) Reduction in Capital due to Capital Adjustment (@ Both (b) and (c) or Which of the following is distributed among partners on reconstitution of partnership firm? (a) Provision for doubtful debts (6) Employees Provident fund (c) Taxation Reserve (d) None of these 5. Capital employed of a firm is % 3,00,000. The annual profit earned by the firm during the year is @ 48,000. The money could be kept in a bank for 5 years at 10% p.a. considering 2% as fair compensation for risk involved in business, the goodwill of the firm on the basis of capitalisation will be: (a) & 1,00,000 (B) & 180,000 (©) %1,20,000 (2) None of these 6. A Debenture of 2 100 each, issued at 2 40 premium, to be redeemed at half of the premium received on issue, out of which % 70 (including @ 10 premium) was called up and paid up. The uncalled Capital will be (@) 730 ® %20 ©) 740 (d) 730 or can be issued at discount but cannot be issued at discount except Sweat Equity Shares. (@) Debentures, Bonds (6) Debentures, Shares (c) Shares, Debentures (@) Loan, Shares 7. Mohit had been allotted for 600 shares by a Govinda Ltd. on pro rata basis which had issued two shares for every three applied. He had paid application money of % 3 per share and could not pay allotment money of @ 5 per share. First and final call of % 2 per share was not yet made by the company. His shares were forfeited. The following entry will be passed: Equity Share Capital Aj Dr. x ‘To Share Forfeited Ale Y ‘To Equity Share Allotment A/c Zz Here X, Y and Z are: (a) % 6,000; & 2,700; @ 3,000 respectively () % 9,000; % 2,700; & 4,500 respectively (©) % 4800; & 2,700; % 2,100 respectively (a) % 7,200; & 2,700; % 4,500 respectively 8. Paper and Pen are partners. Paper draws a fixed amount at the beginning of every month. Interest on drawings is charged @6 % paa. At the end of the year 31 March 2024 interest on Paper’s drawings, amounts to & 1,560, Monthly drawings of Paper were: (@) 78,000 (B) @ 60,000 (©) 77,000 (a) = 4,000 or Vishu, a partner withdrew & 4,000 at the end of each quarter and interest on drawings was calculated as % 360 at the end of accounting year 31 March 2024. What is the rate of interest on drawings charged? (@) 6% pa. () 8% pa. (©) 10% pa. (d) 12% pa. 9. Mahi, Rubi and Ginni are partners in a firm sharing profits and losses in the ratio of 6 : 4 : Mahi guaranteed a profit of € 50,000 to Ginni, Net profit for the year ending 31st March, 2024 was % 1,10,000. Mahi’s share in the profit of the firm after giving guaranteed amount to Ginni will be: (@) % 20,000 (B) @ 60,000 (©) © 40,000 (@) 7 10,000 (2} “Together with® EAD Accountancy—1210, Sangeet and Suman were partners in a firm sharing profits and losses in the ratio of 7: 3. During the year ended 31,3.2024 the firm earned a profit of & 100,000. After preparation of the financial statements it was discovered that salary to Suman @ @ 3,000 per month had been omitted. The necessary adjustment entry for the same will be: Dr @) cr @) (@) Profit and Loss Appropriation A/c Dr. 36,000 ‘To Suman's Capital Ale 36,000 (b) Sangeet’s Capital A’e Dr. 36,000 ‘To Suman’s Capital Ave 36,000 (©) Profit and Loss Adjustment Ale Dr. 36,000 ‘To Suman’s Capital Ale 36,000 (@) Sangeet’s Capital A‘e Dr. 25,200 ‘To Suman’s Capital Ale 25,200 11. Black and White are partners sharing profits in the ratio of 2 : 1. They admit Blue for 1/Sth share in future profits. On the date of admission, Black’s capital was @ 2,00,000 and White’s capital was % 1,60,000. Blue brings % 20,000 as his share of goodwill and he agrees to contribute proportionate capital of the combined capital of Black and White. How much capital will be brought by Blue? (a) = 90,000 (B) @ 76,000 (©) 250,000 (@) 272,000 12. Out of the following which one is not a mode of Dissolution by order of Court: (@) A partner becomes a person of unsound mind. (5) A partner is found guilty of misconduct. (c) The business of firm cannot be carried on except at a loss. (@) When business of the firm becomes unlawful. 13. Anuraag Ltd. decided to issue 50,000 Equity shares. It gave its directors and employees right to buy 10,000 of the above shares. The type of issue is: (a) Public Issue (b) Private Placement (©) Rights Issue (a) FSOP 14, At the time of admission of Sunder, a new partner, Land appearing in the book at & 2,70,000 which was found undervalued by 10%. Entry will be: (@) Dr. Land A/e and Cr. Revaluation A/e by & 27,000 (b) Dr. Revaluation A/e and Cr. Land A/e by & 27,000 (c) Dr. Land Ale and Cr. Revaluation Aje by % 30,000, (d) Dr. Revaluation A/e and Cr. Land Ale by & 30,000 18. Asha and Nisha are partner's sharing profits in the ratio of 2: 1. Kashish was admitted for 1/4 share of which 1/8 was gifted by Asha. The remaining was contributed by Nisha. Goodwill of the firm is, valued at % 40,000. How much amount for goodwill will be credited to Nisha’s Capital account? (@) % 2500 (6) % 5,000 (©) % 20,000 (a) % 40,000 or On reconstitution of a firm, any deferred revenue expenditure appearing in the Balance Sheet is: (a) Debited to Partners’ Capital A/es in old ratio (b) Credited to Partners’ Capital Ales (c) Realised in Cash (d) Debited to Revaluation Ajc 16. A and B are sharing profit and losses in the ratio 4: 3. They agreed to share profits in the ratio 3:2 in future, Which statement is correct in this regard? (@) Aand B sacrificed 1/354 of their share of profit. (b) A gained 1/35 share and B sacrificed 1/35* share of profit. (c) A gained 2/354 share and B sacrificed 2/35 share of profit. (d) A sactificed 1/35" share and B gained 1/35* share of profit. new ratio Sample Papers {3 }17. A, Band Cwere partners in a firm having capitals of @ 50,000; 50,000; and = 1,00,000 respectively. ‘Their current account balances were A : % 10,000 (Cr); B : % 5,000 (Cr.) and C : 2,000 (Dr.). Drawings made during the year were & 2,000, % 3,000 and @ 1,500 respectively. According to the partnership deed, the partners were entitled to an interest on capital 5% p.a. C, being the working partner, was also entitled to a salary of & 6,000 paa. The profits were to be divided as follows: (a) The first % 20,000 in proportion to their capitals. (b) Next 30,000 in the ratio of [Link] (c) Remaining profits to be shared equally. ‘The firm made a profit of & 1,56,000 for the year ended 31% March 2014 before charging any of the above items, Prepare the Profit and Loss Appropriation A/c, or A and B were partners in a firm sharing profits in the ratio of 5 : 3. Their fixed capitals on 31st March, 2023 were: A & 60,000 and B & 80,000. They agreed to allow interest on capital @ 12% pa. The profit of the firm for the year ended 31st March, 2024 before allowing interest on capitals was & 12,600. Pass necessary Journal entries for the above transactions in the books of A and B. Also show your working notes clearly. 18, Accounts Guru Limited took over assets of € 40,00,000 and liabilities of & 6,50,000 of Ginny Limited. Accounts Guru limited issued 30,000, 8% Debentures of € 100 each at 10% discount, to be redeemed at 5% premium along with cheque of © 5,00,000. Pass necessary journal entries in the books of Accounts Guru Ltd. Or A company forfeited 8,000 shares of € 10 each on which & 8 were called (including & 1 premium) and & 6 was paid (including & 1 premium). Out of these 5,000 shares were reissued at maximum, possible discount. Pass necessary journal entries. 19. Neha, Pooja and Anju were partners sharing profits and losses in the ratio of 2: 3: 2. On Ist April, 2024 they decided to change their profit sharing ratio as 2: 1: 1. On this date their Balance sheet showed the following balances: General Reserve @ 40,000; Workmen Compensation Reserve & 13,000; (Liability against this was & 4,000) Profit and Loss Ale (Dr. balance) @ 4,200 The assets of the firm were revalued and they resulted in a gain of @ 8,400, The partners had decided to distribute all the Reserves and Profit and Loss A/c but to leave the assets at their original amount. Show the effect of the above adjustments in the books of the partnership firm by passing journal entries. 20, Mahesh and Ramesh are partners in a firm sharing profits in the ratio 2 : 1 Their combined capital on 1 April 2022 was ® 3,84,000. Interest on capital is agreed @ 5% p.a. The profits of the year prior to interest on capital but after charging Ramesh’s salary amounted % 45,000. Fill in the missing figures in the following accounts as on 31** March 2024. In the Books of Mahesh and Ramesh Profit and Loss Appropriation Account Dr ‘for the year ending 31* March 2024 cr Particulars ‘Amount @) Particulars ‘Amount @ ‘To Interest on Capital: By Net Profit 57,000 Mahesh 12,000 Ramesh 7,200 ‘To Salary (Ramesh) (+} “Together with® EAD Accountancy—12Dr Partners’ Capital Accounts cr : ‘Mahesh | Ramesh i Mahesh | Ramesh Particulars a a Particulars a a By Balance bid By Interest on Capital Ale By Profit and Loss Appropriation Ave By Salary Ave ‘To Balance e/d 21, On 1" April 2023, JK Ltd. issued 8,000 9% Debentures of € 100 cach at a discount of 6% redeemable at a premium of 5% after five years. Pass journal entries for the issue and payment of interest on debentures for the year ended 31st March 2024, 22, A, Band Care partners in a firm sharing profits in 3: 2: 1. The firm closes its books on 31st March every year. C died on 30.09.2024, On C’s death the goodwill of the firm was valued at % 60,000. On C’s death, his share in the profits of the firm till the time of his death was to be calculated on the basis of previous year’s profit which was % 78,000. Revaluation account also showed some profit. Fill the missing figures in the following journal entries: Journal Date Particulars LE | De@ | cr@ Ass Capital Ale Dr. B’s Capital Ave Dr. ‘TC's Capital Ale 10,000 (Being treatment of goodwill on death of C) Profit and Loss Suypense Ale Dr To C's Capital Ale (Being C’s share of profit till the time of his death) Revaluation Ale Dr. To As Capital Ale ‘To B’s Capital Ave C's Capital Ale 1,500 (Being distribution of profit on revaluation in partners oll ratio) C's Capital Ale Dr. To Cash Ale To C’s Loan Ave (Being 50% paidimmediately and balance transfer tohhis loan a/c) 23. Malabar Ltd. invited applications for issuing 75,000 equity shares of @ 10 each at a premium of 20%. ‘The amount was payable as follows: On Application @ 2 per share; On Allotment % 5 per share (including premium); On First and final call balance amount. Applications were received for 1,50,000 shares. Applications for 25,000 shares were rejected and application money of these applicants was refunded. Shares were allotted on pro-rata basis to the remaining applicants. Excess money received with applications was adjusted towards sum due on allotment. Rama who had applied for 1,250 shares, failed to pay allotment and call money and Kriti failed to pay first and final call on her 1,000 shares. All these shares were forfeited. 1,000 shares out of forfeited shares were reissued @ % 7 per share fully paid up, including all shares of Rama. Pass necessary journal entries in the books of the company for the above transactions. Sample Papers {5 }Or Viiay Ltd, dealing in manufacture ladies garments decided to manufacture masks, sloves and other precautionary kits for people for which it required more of additional funds. Since the company has already raised money through shares equal to its authorised capital, the company decided to raise the additional funds through issue of % 40,00,000; 7% debentures of 100 each at a discount of 6%, redeemable at a premium of 5% after five years. The amount was payable as follows: On Application ~ % 30; On Allotment ~ The Balance amount. Answer the following, questions on the basis of the above information: ( Pass journal entry for allotment of debentures. Prepare “Loss on Issue of Debentures Account’. What entry will be passed for writing off the interest on debentures? i 24, Jatin and Lalit are partners sharing profits and losses in the ratio of 3 : 2. Their Balance Sheet as at 31" March, 2024 was as follows: abilities Amount @) ‘Assets ‘Amount @) Outstanding Expenses 20,000 | Cash 8,000 Bills Payable 76,000 | Debtors 120,000 Creditors 70,000 | Less: Provision for Workmen Compensation Funel 70,000 | doubtful debts (20,000) | 1,00,000 Investment Fluctuation Fund 20,000 | Stock “$0,000 General Reserve 40,000 | Investments 1,0,000 Capital Accounts: Furniture 0,000 Sit 2,00,000 | Machinery 3,08,000 Lalit 160,000 656,000 6,56,000 On 1 April, 2024 they admitted Kishore as a partner for 1/10* share in profits which he acquired equally from Jitin and Lalit on the following terms: ( Kishore is to bring ® 50,000 as Capital and it was decided that the capital of all partners shall be in proportion to their profit sharing ratio on the basis of Kishor’s Capital. Any deficiency or excess of capital will be adjusted through opening Current Accounts. (i) The Goodwill of the firm is valued at 60,000 and Kishore will contribute his share of goodwill in cash. (ii) Provision on debtors was found to be in excess by % 4,000. () Outstanding expenses will be reduced to @ 6,000. (v) Depreciate stock by 5%. (1%) Market value of investments was € 70,000. Prepare Revaluation A/c and Partners’ Capital Accounts of the newly constituted firm. Or Snehal, Suchita and Sindhu were partners sharing profits and losses in the ratio of 3 : 2 : 1. The firm was dissolved on 31st March 2024, After transfer of assets and liabilities to Realisation A/c the following transactions took place. Give journal entries in the books on dissolution of the firm. (a) Suchita’s Loan to the firm & 30,000 was settled at & 28,500, (5) Workmen Compensation Reserve ~ & 40,000. A liability equal to 60% of the reserve was settled. (6) Sindhu was to receive 5% of the value of assets realised as remuneration for completing the dissolution work and was to bear realisation expenses. Realisation expenses were & 5,500 that was paid by Sindhu, Assets realised % 60,000. (d) The Balance Sheet disclosed a footnote, contingent liability for & 5,000 in respect of a bill discounted. The bill was received from Megha. On the date of dissolution, Megha was declared insolvent and was not able to pay the amount due. The bill had to be met by the firm. “Together with® EAD Accountancy—12(e) Realisation expenses of € 12,000 were paid by the partners in their profit sharing ratio on behalf of the firm. ( Dharam, a debtor of & 60,000 had to pay the amount due 2 months after the date of dissolution He was allowed a discount of 9% pa. for making immediate payment. 28, X, Y and Z are partners sharing profits and losses in the ratio of 3: 2: 1. Their Balance Sheet as on 31" March, 2024 stood as under: “Amount Amount Liabilities a Assets a Bills Payable 90,000 | Cash at Bank 44,000 Creditors 36,000 | Debtors 70,000 General Reserve 18,000 | Less: Provision for doubtful Investment Fluctuation Fund 400] debes (10,000) 0,000 Capital Aves: Stock 180,000 x 1,40,000 | Investments 44,000 Y 160,000 | Furniture 48,000 Z 100,000 | Machinery 2,48,000 Goodwill 24,000 5 48,000 5,48,000 On the above date Y retired. It is agreed that: Goodwill of the firm will be valued at % 90,000. Value of Machinery and Furniture to be depreciated by 5%. Provision for doubtful debts to be maintained at 20% on Sundry Debtors. Out of total insurance paid, premium amounting to the extent of @ 1,000 to be treated as prepaid insurance. This was earlier debited to the Profit and Loss Account. (®) The total capital of the new firm is decided to be ® 2,40,000. Necessary adjustments to be made in cash. (vi) Y will be paid 20% of the total amount due to him in cash and the balance will be transferred to his Loan Account. Prepare Revaluation A/c and Partners’ Capital Accounts of the reconstituted firm. 26. Accounts Guru Limited was incorporated on Ist April 2017 with registered office in Jaipur. The Capital clause of Memorandum of Association reflected a registered capital of 8,00,000 equity shares of € 10 each and 1,00,000 preference shares of 7 50 each. Since some large investments were required for buildingand machinery the company in consultation, with vendors, Vikas & Sons, issued 3,00,000 equity shares and 40,000 preference shares at par to them in full consideration of assets acquired. Besides this the company issued 2,00,000 equity shares for cash at par payable as @ 3 on application, @ 2 on allotment, % 3 on first call and 2 om second, call. Till date second call has not yet been made and all the shareholders have paid except Mr. Kartik who did not pay allotment and calls on his 3000 shares and Mr. Lavish who did not pay first call on his 2000 shares. Shares of Mr. Kartik were then forfeited and out of them 1500 shares were reissued at @ 12 per share. Based on above information you are required to answer the following questions. (i) Shares issue to vendors of building and machinery, Vikas & Sons, would be classified as: (a) Preferential Allotment (6) Employee Stock Option Plan (c) Issue for Consideration other than cash (d)_Right Issue of Shares (i) How many equity shares of the company have been subscribed? (@) 5,00,000 (B) 3,00,000 (©) 2,00,000 @ 5,40,000 Sample Papers27. ’) What is the amount of Securities premium reflected in the balance sheet at the end of the year? (@) % 2,000 (6) % 6,000 (©) % 4,000 @ % 10,000 (i) What amount of share forfeiture would be reflected in the balance sheet? (@) 6,000 () % 9,000 (©) % 2,000 (@) % 4,500 (®) As per Companies Act 2013, Securities Premium Balance can be utilised for which of the following purpose? (a) Issuing bonus to existing shareholders to convert partly paid up into fully paid-up bonus shares. (b) Providing for Premium payable on Redemption of Debentures. (c) Writing off all Capitalised Expenditures (d) Buy Back of Debentures (0%) How much amount is to be transferred to Capital Reserve at the time of reissue of 1500 shares of Kartik? (@) % 3,000 (6) 4,500 (©) % 9,000 @ %1,500 PART - B Analysis of Financial Statement If fixed tangible assets whose original cost is € 40,000 having accumulated depreciation @ 12,000 were sold for % 34,000 then while preparing cash flow statement its effect on cash flow will be: (@) Cash flow from financing activities & 34,000 (b) Cash flow from financing activities @ 6,000 (©) Cash flow from investing activities & 34,000 (d) Cash flow from investing activities & 6,000 or Match the following, A. Sale of Patents (2) Operating Activity B. Profit on sale of Investments (2) Investing Activ (3) Financing Activity (4) Cash and Cash Equivalents (@) Ad BA ® (©) Ads Bo @ Statement I: While preparing cash flow statement by indirect method, Decrease in Assets and Increase in Liabilities are added back to profit during the year to arrive at operating profit: Statement II: Increase or Decrease in goodwill is added or subtracted respectively, under operating, activity. (@ Both the Statements are true (®) Both the Statements are false Only Statement is true. (@ Only Statement-Il is true Calls-in-advance appears in a company’s Balance sheet under: (@) Share capital (c) Reserves and surplus Determine Operating Ratio, if Operating Expenses is @ 60,000, Revenue from Operations is ¥ 9,00,000 and Cost of Revenue from operations is % 6,60,000. (@) 80% (6) 15% (ce) 20% (@) 1% “Together with® EAD Accountancy—1230. Gross Profit Ratio of a Company is 25%. Cost of revenue from operations are 3/44 of revenue from operations. If revenue from operations is ® 60,00,000, the Gross Profit of the company will be: (a) % 25,00,000 (b) 2 45,00,000 (©) % 15,00,000 (d) %11,25,000 31. How are the following items represented in a Company's Balance Sheet? (?) Debit balance in Statement of Profit and Loss (@) Interest accrued and due on Debentures (ii) Capital Advances (©) Computer Software under development (») Bank overdraft (vi) Interest accrued on Investment 32, Prepare Common-size Income Statement for the following information. Particulars 3132004 @ [313-2023 Revenue from Operations 9,00,000 600,000 Other Income 108,000 120,000 Cost of Material consumed 5,40,000 3,00,000 Other Expenses 0,000 60,000 Tax 40% 40% 33. (a) From the following information, compute Debt to Capital Employed Ratio. 10% Debentures % 1,00,000 Equity Share Capital % 4,00,000 89% Public Deposits % 2,50,000 Reserves and Surplus % 2,50,000 Long-term Provisions % 100,000 formation related to 202: () From the followi compute Net Assets or Capital Employed ‘Turnover Rati ® ® Plant and Machinery 5,00,000 Bank 41,20,000 Land and Building 3,00,000 Cash 80,000 Motor Car 2,50,000 Creditors 360,000 Furniture 1,75,000 Bills Payable 20,000 Inventory 1,25,000 Outstanding Rent 40,000 Debtors 1,40,000 Revenue from Operations for the year 2023-24 were % 40,00,000. or (@) State giving reasons, whether following transactions would increase, decrease or not change the Inventory Turnover Ratio: (@) Sale of goods for & 50,000 (costing & 49,000) (@) Goods costing & 35,000 distributed as free samples (b) Net profit before Interest and Tax 7 3,00,000 Net Fixed Assets % 10,00,000 Net Working Capital % 5,00,000 Current Assets % 11,00,000 Calculate Return on Investment, Sample Papers34, From the following information, prepare a Cash Flow Statement: Balance Sheet «as at 31.03.2024 and 31.03.2023 31* March | 31 March 7 Note Particulars No | 2024 2023 @. @, 1. EQUITY AND LIABILITIES 1. Shareholders’ Funds: (@) Share Capital 1 130,000 () Reserves and Surplus 2 4,000 2. Non-Current Liabilities (10% Debentures) 21,000 3. Current Liabilities (Trade Payables) 8,500 Total 163,500 II. ASSETS 1. Non-Current Assets: Property, Plant and Equipment and Intangible Assets: Property, Plant and Equipment: Tangible Fixed Assets (Net) 441,000 32,000 Intangible Assets (Goodwill 8,000 10,500 Non-Current Investments 68,000 3,000 2. Current Assets: (Current Investments 49,000 50,000 ‘Cash and Cash Equivalents 4,000 2,000 Other Current Assets 24,500 6,000 Total 1,94,500 163,500 Notes to Accounts: [31* Mareh 2024 | 31° Mareh 2023 Particulars ©. @. 1. Share Capital Equity Shares of € 10 each 1,35,000 130,000 2. Reserves and Surplus General Reserve 11,000 10,000 Surplus ie, balance in Statement of Profit and Loss 11,000 (6,000) 22,000 4,000. Additional Information: (2) A machine costing % 3,000 (depreciation provided thereon % 400) was sold for % 2,800. Depreciation charged, during the year was @ 4,400. Debentures were issued on 1" April, 2023. (ii) Interim dividend of % 30,000 has been paid during the year. “Together with® EAD Accountancy—121 % 10. u. 2. 1B. 4. 15. 16. 1. SOLUTIONS (©) (A) is true but (R) is false. (©) 95% [(@ 100 - Discount per debenture) Discount per debenture = Or ‘Total Amount used to write off Loss on issue of Debenture (d) 15% Total No. of Debentures (c) % 15,000, and @ 10,000 Or —_(d) None of these {= 48,000 xa) — @ 3,00,000 (@) % 1,00,000 [Total capitalised value of the firm — Net Assets = = @ 1,00,000] (c) 7 40 [% 100 ~< 60 (excluding premium)] or () Debentures, Shares (©) % 4800; & 2,700; % 2,100 respectively @ %4000 Or (@) 6% pa (@) % 20,000 (Hine: (1,10,000 x 6/11) ~ 40,000] (d) Sangeet’s Capital Afe Dr, 25,200 ‘To Suman’s Capital A’e 25,200 () & 76,000 (@) When business of the firm becomes unlawful. (@) ESOP (c) Dr. Land A/c and Cr. Revaluation Ale by & 30,000 (6) & 5,000 or (@) Debited to Partners’ Capital A/es in old ratio Total Amount used to write off Discount _ & 2,00,000. Total No. of Debentures ~ 40,000) (b) A gained 1/354 share and B sacrificed 1/35* share of profit. In the Books of A, B and C Profit and Loss Appropriation Account Dr ‘for the year ended 31* March, 2024 cr i Amount . Amount Particulars a Particulars ai ‘To Interest on Capital Aves: By Profit and Loss Ale (Net Profit) 156,000 A 2,500 B 2,500 c 5,000] 10,000 ‘To Salary to © ——| 6,000 To Profit transferred to Current Ales: ‘A (5,000 + 15,000 + 30,000) 50,000 B (5,000 + 9,000 + 30,000) 44,000 (10,000 + 6,000 + 30,000) 46,000 | 1,40,000 156,000 156,000 Sample Papers {11}18, Or Journal Date Particulars Le] De® | ce@® 2018 | Interest on Capital Ale Dr. 12,600 March | To As Current Ale 5.400 at ‘To B's Current Ae 7,200 (Being interest on capital credited to Partners’ Current Accounts) March | Profit & Loss Appropriation Ale Dr. 12,600 at ‘To Interest on Capital Afe 12,600 (Being interest on capital transferred to Profit & Loss Appropriation, Account) Working Note: Interest on Capital: A = 12% of 8 60,000 = & 7,200 B = 12% of € 80,000 = % 9,600 16,800 Since profits are insufficient interest on capital will be distributed in the ratio of @ 7,200 : 9,600 or 3: 4. Thus, Interest on Capitals allowed to: ‘Total interest = A = 3/7 of & 12,600 = % 5,400; and B = 4/7 of @ 12,600 = @ 7,200. Journal Date Particulars LE] De® | Cre ‘Assets Ale Dr. +4,00,000, ‘To Liabilities Ale 6,50,000 ‘To Ginny Lid. Afe 32,00,000, ‘To Capital Reserve Afe 150,000 (Being Business taken over and capital reserve recorded) ‘Ginny Limited Ale Dr. 3200,000, Loss on Issue of Debentures Ale Dr. 4,50,000 “To 8% Debentures Afe 30,00,000, ‘To Premium on redemption of Debentures 150,000 ‘To Bank Afe 5,00,000 (Being purchased consideration discharged) Or Journal Date Particulars LE] De® | ce® Share Capital Afe Dr. 56,000 ‘To Shares Forfeited Ave 40,000 ‘To Calls-in-arrears Ale 16,000 (Being Shares forfeited) Bank Ave Dr. 10,000 ‘Shares Forfeited Ale Dr. 25,000 ‘To Share Capital Ale 35,000 (Being 5000 shares reissued at discount) (2} “Together with® EAD Accountancy—12wv, In the books of Neha, Pooja and Anju Journal Date Particulars LE Cr.) 2024 | General Reserve Ale Dr. April | Workmen Compensation Reserve Ale Dr. 13,000 ‘To Claim against Workmen Compensation Reserve Ale 4,000 ‘To Neha’s Capital Ale 14,000 “To Pooja’s Capital Ale 21,000 To Anju's Capital A’e 14,000 (Being reserve distributed in old profit sharing ratio) April [Neha’s Capital Ave De 1,200 Pooje’s Capital Ave Dr. 1,800 Anju’s Capital Ave Dr. 1,200 ‘To Profit and Loss Ave 4.200 (Being debit balance of Profit and Loss A/e written off in old ratio) April | Neha’s Capital Ave Dr. 1,800 ‘To Pooja’s Capital Ale 1,500 ‘To Anju's Capital Ale 300 (Being adjustment entry passed for revalued, without disturbing assets account) Calculation of gain/saerifice: Neha’s gain 6/28, Pooja’s sacrifice 5/28, Anju’s sacrifice 1/28. In the Books of Mahesh and Ramesh Profit and Loss Appropriation Account Dr {for the year ending 31° March 2024 cr Particulars canal Particulars ee @ &) ‘To Interest on Capital: By Net Profit 57,000 Mathesh 12,000 Ramesh 7200 19,200 ‘To Salary Ramesh 12,000 ‘To Divisible Profit: Mahesh 17,200 Ramesh 8,000 | _ 25,800 37,000 57,000 Dr Partners’ Capital Accounts cr ‘Mahesh | Ramesh Mahesh | Ramesh Particulars Particulars ®) &®) ® ®) ‘T Balance ed Bal. Fig.) | 2,69,200] 1,71,800| By Balance bid 2,40,000| 1,44,000) By Interest on Capital Ale 12,000 7,200 By Profit and Loss Appropriation Ae | 17,200] 8,600 By Salary A/e 12,000) 2,69,200 | 1,71,800) 2,69,200| 1,71,800) Sample Papers {3 }2. In the books of JK Ltd. Journal Particulars LE ce@, 2023 April April 1 March 31 March 31 March 31 March 31 Bank Ale Dr. ‘To Debentures Application and Allotment Ae (Being application and allotment money received on 000, 9% debentures of € 9.40 each) Debentures Application and Allotment Ale Dr. Loss on Issue of Debentures Ae Dr. “To 9% Debentures Afe ‘To Premium of Redemption of Debentures Ale (Being 8,000, 9% debentures each allotted at a discount of 6%, redeemable at a premium of 5%) ‘Statement of Profitand Loss Dr. ‘To Loss on Issue of Debentures Ave (Being loss and discount on issue of debentures witten off) Debentures Interest Ale Dr. ‘To Debentureholders’ Ale (Boing interost due on 8,000, 9% debentures for the year) Debenturcholders’ Ale Dr. ‘To Bank Ale (Being debentures interest paid) ‘Statement of Profit and Loss Dr. ‘To Debentures Interest A‘e (Being debenture interest transferred to Statement of Profit and Loss) 7,52,000 188,000 188,000 72,000 72,000 72,000 7,52,000 8,00,000 40,000 88,000 72,000 72,000 72,000 In the Books of A, B and C Journal Entries Particulars: LE Dr. @) cr @ Sep 30 Sep 30 Sep 30 : g = ys B¥s Capital Ale ‘To C’s Capital Ave (Being treatment of goodwill on death of ©) Profit and Loss Suspense Ale Dr. ‘To C’s Capital Ave (Being C’s share of profit till the time of his death) Revaluation Ave Dr. To As Capital Ave ‘To C's Capital Ave (Being distribution of profit on evalua mn in partners old C's Capital Ale Dr To Cash Ave ‘To C’s Loan Ale (Being 50% paid immediately and balance transfer tohis loan Ale) 6,300 50,000 10,000 6500 4,500 3,000 1,500 25,000 25,000 “Together with® EAD Accountancy—12In the books of Malabar Ltd. Journal Date Particulars LE] De@ | cr@ @ [Bank ave Dr 3,00,000 ‘To Equity Share Application Ale 3,00,000 (Being application money received on 1,50,000 shares @ 2 cach) (| Equity Share Application Ave Dr. ‘To Equity Share Capital Ave 1,50,000 ‘To Equity Share Allotment Ale 1,00,000 ‘To Bank Ae 50,000 (Being application money adjusted) (ii) | Equity Share Allotment A’e Dr 3,75,000 ‘To Equity Share Capital Ave 2,25,000 ‘To Secutities Premium 1,50,000 (Being the allotment money due on 75,000 shares @ & 5 per share inetuding premium of & 2 per share) () | Bank Ale De 2,72.250 ‘To Equity Share Allotment Ae 2,72,250 (Being allotment money received, ie, & 2 1,00,000— 2,750 (WN:i)) ©) | Equity Share First and Final Call Afe Dr 3,75,000 ‘To Equity Share Capital A’e 3,75,000 (Being the first and final call money due on 75,000 shares @ & 5 per share) () [Bank Ave De 366,250 ‘To Equity Share First and Final Call Ale 3,66,250 (Being the first call money received except on 1,750 shares) (it) | Equity Share Capital Ave (1750(8) x & 10) Dr. 17,500 Seeutities Premium Ave (750(8) x & 2) Dr. 1,500 ‘To Share Forfeiture Ave (1250(s) x & 2) + (1000(8) x & 5) 7.500 ‘To Equity Share Allotment Ave (WN-i) 2,750 ‘To Equity Share First and final Call Alc (1750(s) * @ 5) 8,750 (Being shares forfeited for non-payment of allotment and call) (iit) | Bank Ave Dr. 7,000 Share Forfeiture Ale Dr. 3,000 ‘To Equity Share Capital Ave 10,000 (Being 1,000 of the forfeited shares reissued @ 27 per share fully paid-up) (@)__| Share Forfeiture Ale Dr 750 750 ‘To Capital Reserve A/c (WN- (Being balance of share forfeiture transferred to Capital Reserve Ae) Sample Papers {18}Working notes: (® No. of Shares Alloted to Rama = Allotment due from Rama [750(s) x & 5] Less: Excess Money Adjusted on Allotment [500(s) x = 2] Allotment unpaid by Rama (i) Caleulation of Capital Reserve Amount forfeited from Rama [1250(s) x & 2] Less: Loss on reissue of his shares [750(8) x & 3] @ @ (i) Gain on reissue of Rama’s shares 500 : Gai int X 250(s) - 250(s) x &3 ze Add: Gain on Kirti’s shares | 709, © (s) (8) 500 Capital Reserve = 750 Amount forfeited from Kirti = (1000(s) x ® 5) = 5,000 Reissue shares of Kirti = 1,000 ~ 750 (Rama’s Shares) = 250 shares Or Journal of Vijay Ltd. Date Particulars LE] De® | Cr@ (@) | 74% Debentures Allotment Alc (40,000(D) x64) Dr. 25,60,000| Loss on Issue of Debentures Ae (40)000(D) x 811) Dr 4,40,000) ‘To 7% Debentures Ale (40,000(D) x & 70) 28,00,000 ‘To Premium on Redemption of Debentures Ale 2,00,000 (40,000(D) x @ 5) (Being allotment money due on 79% debentures issued of 6% iscount and repayable at 5% premium) [Bank Ave Dr. 25,60,000 ‘To 7% Debentures Allotment Alc 25,60,000 (Being allotment money received) Dr Loss on issue of Debentures Account cr Date Particulars Ament) Date Particulars al © & Year | 1 7Debentures Ale 2,40,000] Year| By Statement of Profit and Loss ‘Beginning|To Premium on Redemption Ending 4,40,000] of debentures Ave 2,00,000} 4,40,000] +4.40,000] Journal Date Particulars LE | pr@ | ce@ Statement of Profit and Loss Dr 2,80,000 ‘ToInterest on Debentures Ae 2,80,000 (Being interest on debentures written off) “Together with® EAD Accountancy—12In the Books of Jatin, Lalit and Kishore Dr Revaluation Account cr “Amount “Amount Particulars Particulars @) @ To Stock A’e 44000 | By Provision on Debtors Ave 44000 Tolivestments Ae 10.000 | By Outstanding Expenses Ae 14,000 ‘Tp Profits transferred to (Bal. fig. (& 20,000 € 6,000) iin’ Capital A/c 2.400 Lalit s Capital ave 1,600 18,000 15 00 Dr Partners’ Capital Accounts cr : Jin] Late | Kishore ; Jin] Latte [Kore Partcolars Part o |e | @ ian ® | ® | @ To Balance od 2.71400 | 208,600] s0000 | By Balance bid 2.00000 | xeac0o | — (Bal fe) By Cash Ale =} | sooo By Premium fr Goodell Ale sooo] sooo} — DyGenerat Reserve Alc | 24000] 16000] Dy Revaluation At 200] 1600) — yWorkmen Compensation | 42000] 26.000] und Ave 2.71,a00 | 208,600 | 50000 1.400 | 2.08.600] $0000 ToLalits Curent Ae =] ase] — | by Balance bid 2.71400 | 208,600] S000 ToBalance of 2.15000 | 1.15000 | 50000 | By Sin’ Current Ate sooo} -f 2.75000 | 208,600 | 50,000 2,75,000| 208.600] 0,000 Balance Sheet of the new firm as at 1 April 2024 rabies Amount © re Amount © Ouistanding Expenses «6,000 | Cash «64,000 Bills Payable 76,000 | Debrors 1,20,000 Creditors 70,000) Less: Provision for doubtful Lali’s Curent Ale 33,600 debss 16000) } 1.04000 Capital Accounts: Stock 76,000 sitin 2,75,000 | investments 7a.000 Lalit 1,75,000 | Furmitare 0,000 Kishore 50,000 | Machinery 308000 Sikin’s Current Ave 3,600 685,600 685,600 Working Notes: Cash balance is % 8,000 + % 50,000 + % 6,000 = % 64,000 Capital of the firm = % 5,00,000 New ratio of Jatin, Lalit and Kishore is [Link] 2 Jitin’s Capital & 2,75,000, Lalit's Capital & 1,75,000, Kishore’s Capital ® 50,000. Sample PapersOr In the books of Snehal, Suchita and Sindhu Journal Date Particulars LE[ De® | ce@ (@) | Suchita’s Loan Ave Dr. 30,000 ‘To Bank Ave 28,500 “To Realisation Ale 1,500 (Being settlement of partner's oan) (©) _ | Workmen Compensation Reserve Ale Dr. 40,000 ‘Te Realisation Ale (amount equal to elim) 24,000 ‘To Snehal’s Capital Ale 8000 “To Suchita's Capital Ave 5333 ‘To Sindhu’s Capital Ave 2667 (Being workmen compensation reserve transferred) Realisation Ave Dr. 24,000 ‘To Bank Ave 24,000 (Being lability against workmen compensation paid) (©) | Realisation Ave Dr. 3.000 ‘To Sindhu’s Capital Ave 3.000 (Being remuneration payable to Sindhu Bank Ae Dr. 60,000 "To Realisation Ale 60,000 (Being asets realised) (@) | Realisation Ave Dr. 5.000 ‘To Bank Ave 5,000 (Being amount pai for the bill) (©) | Realisation Ave Dr. 12,000 ‘To Snehal’s Capital Ate 6.000 ‘To Suchita’s Capital Ave 4.000 ‘To Sindhu's Capital Ave 2.000 (Being realisation expense paid by partners in their profit sharing ratio) | Bankicash Ale Dr. 59,100 "To Realis 59,100 (Being debtor realised) 28. In the Books of X, ¥ and Z Dr Revaluation Account cr ‘Amount Amount. Particulars Particulars 3) @, ‘To Machinery Ale 12,400. | By Prepaid Insurance Ae 1,000 ‘To Rurniture Ale 2,400 | By Loss transferred to: ‘To Provision on debtors Ale 4,000 | X's Capital Ae 8900 Y's Capital Ale 5,938, Zs Capital Ave 2,967 18,800 18,800 “Together with® EAD Accountancy—1220. 30, Dr Partners’ Capital Accounts cr a x y z x Y z o |e] @ |e] @ To Goodwill Ale 12000] 000! 4,000 | By Balance bid 140,000 | 1,60,000 | 1,00,000 ToY's Cepital Ale 22,500 -| 700] By General Reserve Ae | 9,000] 6000) 3.000 ‘ToRevaluation Aic(Loss)| 8900] 5933] 2,967 | By X°s Capital Ave =| 22,500 - To Cash Ale -| 36680 By Z'sCapital Ac =| 7500 7 (20% cf 183,000) By Investment ‘ToY's Loan Ave (Bal. fig.) -| 146720 —| Fluctuation Find Ae | 2,000] 1,338) 667 ‘To Cash Ale (Bal. fiz) - =| 20200] By Cash Ale (Bal fis.) | 72.400 = 2 ‘To Balance od (W! 1,80,000 =| 60,000 1.03667 2.23.400 | 1,97,333 | 1,03,667 Working Note: New Capital of Partners ‘Total Capital of New Firm = 2,40,000 New Ratio of X and Z = 3:1 Hence X's capital € 1,80,000 and Z’s Capital A/c € 60,000. (2) (e) Issue for Consideration other than cash (i) (@ 5,00,000 (ii) (@) % 2,000 @) @ % 4,500 (®) (6) Providing for Premium payable on Redemption of Debentures (i) @) % 4,500 (c) Cash flow from investing activities % 34,000 (6) AZ B2 (©) Only Statement-T is trae, (@) Current liabilities © 7,20,000 © O% [Same (e) © 15,00,000 xa] Or Sample Papers31, | [Link]. tems ‘Major Head Sub-Head (# [Debit balance in Statement of Profit and| Shareholders’ Funds [Reserves and Surplus (As negative ‘Loss lamount) {Interest accrued and due on Debentures |Current Liabilities |Other Current Liabilities Capital Advances, /Non-Current Assets {Long-term Loans and Advances |Computer Software under development |Non-Current Assets |Property, Plant and Equipments and Intangible Assets - Intangible Assets lunder Development (©) {Bank Overdraft Current Licbiies _|Shor-term Borrowings (i) |Imterest accrued on investment Current Assets _|other Current Assets Em Common-Size Income Statement for the year ended 31st March, 2023 and 2024 Percentage of Revenue from vata Note Absolute value cee No. | 31st March 2023 | 31st March 2024 | 31st March | 31st March gy & 2024 1. Revenue from Operations 6,00,000, 9,00,000 100% II, Other Income 000 1,08,000 128%, IML. Total Revenue 7,20,000, 10,08,000 112% IV. Expenses: Cost of Material Consumed, 3,00,000, 5,40,000 50% 60% Other expenses 60,000 60,000 10% 665% V. Total Expenses 3,60,000, 6,00,000 60% 66.6% VI. Profit before Tax (III -~ V) 3,60,000, 408,000 60% 45.33% VIL. Lese: ax 144,000 1,63,200 24% 18.13% VIII, Profit after ‘ex (VI — VIL) 2,16,000, 244,800 36% 27.2% Debt 33. (@) Debt to Capital Employed Ratio = GT pioved (Debt + Equi) 10% Debentures (@ 1,00,000) + 89% Public Deposits (8 2,50,000) + Long-term Provisions (@ 1,00,000) Debt + Equity (Equity Share Capital + Reserves and Surplus) 450,000 % 4,50,000 + % 6,50,000 Revenue from operations ‘Capital Employed or Net Assets 2 40,00,000 (6) Net Assets or Capital Employed Turnover Ratio = 2 12,70,000 3.14 Times Working Note: Net Assets = € 25,00,000 + % 3,00,000 + % 2,50,000 + & 1,75,000 + & 1,25,000 + & 1,40,000 + & 1,20,000 + & 80,000 ~ % 3,60,000 - & 20,000 ~ & 40,000 = & 12,70,000 “Together with® EAD Accountancy—12or (@) (2) Increase, as cost of Revenue from Operationswill increase because of decrease in closing inventory by % 40,000 and average inventory will also decrease. (i) Increase, as cost of Revenue from Operationswill not change because of decrease in purchases and decrease in closing inventory by the same amount ie. % 35,000. (b) Net Profit before Interest and Tax = & 3,00,000 Capital Employed = Net Fixed Assets + Net Working Capital % 10,00,000 + % 5,00,000 7 15,00,000 Retna Investment = —NEtPoft before Interest and Tis 45 7, |. Capital Employed €3,00,000 soy = ap = SS «100 = 20% % 15,00,000 Mo Cash Flow Statement for the year ended 31st March 2023 ‘Amount | Amount Particalars ail © co) AL ‘Cash Flows from Operating Activities: Net Profit before taxand Extraordinary items (note 1) 48,000 Adjustments for non-cash and non-operatng items: on Fixed Tangible Assets 44400 of Gooxh 23500 Interest on Long Term Borrowings 25500 Less: Profit on sale of machinery (200) (Operating profit before working capital changes “Add: Increase in current liabilities and Decrease in current assets ‘Trade Payable 4,000 Less: Decrease in current liabilities and Inerease in current assets Increase in other current assets (18,500) Cash flow from operating Activities 2,700 42,700 B Purchase of Property, Plant and Equipment ~ Tangible Assets (16,000) (note 2) Sale of Property, Plant and Equipment ~ Tangible Assets 2,800 Purchase of Investments (5,000) (48,200) Net Cash used in Investing Activities (18,200) . | Cash flow from Financing Activities: Proceeds from Issue of Share Capital 5,000 Proceeds from Issue of Long Tem Borrowings 4,000 Interest paid on Long Term Borrowings (2500) Interim Dividend paid (30,000) Net Cash used in Financing Activities (23,500) (23,500) D. | _ Netincrease in cash and cash equivalents (A +B +C) 1,000 Add: Cash and Cash equivalents at the beginning, Current Investments, 50,000 Cash and Cash Equivalents 2,000 52,000 E. | Cash and Cash equivalents at the end 49,000 F | Current Investments 4,000 53,000 Sample Papers {24}Working Notes: (®) Net profit for the current year 11,000 —(- % 6,000) = 17,000 Add: Transfer to General Reserve 1,000 Interim Dividend Paid % 30,000 Net Profit before tax and Extraordinary items 343,000 (i) Dn Property, Plant and Equipment (Tangible Assets) Account cr Amount ‘Amount Particulars Particulars ® ® ‘To Balance bid 32,000 | By Depreciation A’e 4,400 ‘To Statement of Profit and Loss 200 | By Bank Ave (Sale) 2,800 ‘To Bank Ale (Purchases) (Bal. Fis.) 16,000 | By Balance cfd 41,000 48,200 (} “Together with® EAD Accountancy—12