- -Strictly Confidential : (For Internal and Restricted Use Only)

Senior School Certificate Examination

March -2014-15
Marking Scheme - Accountancy ( Foreign) 67/2/1, 67/2/2, 67/2/3
General Instructions:-
1. The Marking scheme provides general guidelines to reduce subjectivity in the marking. The answers given in the marking scheme are
suggested answers. The content is thus indicative. If a student has given any other answer which is different from the one given in the
marking scheme but conveys the same meaning, such answers should be given full weightage.

2. Evaluation is to be done as per instructions provided in the Marking Scheme. It should not be done according to one's own
interpretation or any other consideration-Marking. Scheme should be strictly adhered to and religiously followed.

3. The Head-Examiner has to go through the first five answer scripts evaluated by each evaluator to ensure that evaluation has been
carried out as per the instructions given in the Marking Scheme. The remaining answer scripts meant for evaluation shall be given
only after ensuring that there is no significant variation in the marking of individual evaluators.

4. If a question has parts, please award marks on the right hand side for each part. Marks awarded for different parts of the question
should then be totalled up and written in the left hand margin and encircled.

5. If a question does not have any parts, marks must be awarded in the left hand margin and encircled.

6. If a student has attempted an extra question, answer of the question deserving more marks should be retained and other answer
scored out.

7. No marks to be deducted for the cumulative effect of an error. It should be penalized only once.

8. Deductions up to 25% of the marks must be made if the student has not drawn formats of the Journal and Ledger and has not given
the narrations.

9. A full scale of marks 1-80 has to be used. Please do not hesitate to award full marks if the answer deserves it.

10. No marks are to be deducted or awarded for writing / not writing ‘TO and BY’ while preparing Journal and Ledger accounts.

11. In theory questions, credit is to be given for the content and not for the format.

12. In compliance to the judgment of the Hon’ble Supreme Court of India, Board has decided to provide photocopy of the answer
book(s) to the candidates who will apply for it along with the requisite fee from 2012 examination. Therefore, it is all the more
important that the evaluation is done strictly as per the value points given in the marking scheme so that the Board could be in a
position to defend the evaluation at any forum.

13. In the light of the above judgment instructions have been incorporated in the guidelines for Centre Superintendents to ensure that the
answer books of all the appeared candidates have been sent to the Board’s office and in the Guidelines for spot evaluation for the
Examiners that they have to evaluate the answer books strictly in accordance with the value points given in the marking scheme and
the correct set of the question paper. The examiner(s) shall also have to certify this.

14. Every Examiner should stay up to sufficiently reasonable time normally 5-6 hours every day and evaluate 20-25 answer books.

15. In the past it has been observed that the following are the common types of errors committed by the Examiners-.
 Leaving answer or part thereof unassessed in an answer script
 Giving more marks for an answer than assigned to it or deviation from the marking scheme.
 Wrong transference of marks from the inside pages of the answer book to the title page.
 Wrong question wise totaling on the title page.
 Wrong totaling of marks of the two columns on the title page
 Wrong grand total
 Marks in words and figures not tallying
 Wrong transference to marks from the answer book to award list
 Answers marked as correct but marks not awarded.
 Half or a part of answer marked correct and the rest as wrong but no marks awarded.

16. While evaluating the answer scripts if the answer is found to be totally incorrect, it should be marked as (X) and awarded zero(0)
Marks.

17. Any unassessed portion, non-carrying over of marks to the title page or totaling error detected by the candidate shall damage the
prestige of all the personnel engaged in the evaluation work as also of the Board. Hence in order to uphold the prestige of all
concerned, It is again reiterated that the instructions be followed meticulously and judiciously.

18. The Examiners should acquaint themselves with the guidelines given in the Guidelines for Spot Evaluation before starting the actual
evaluation.
19. Every Examiner shall also ensure that all the answers are evaluated, marks carried over to the title page, correctly totaled and
written in figures and words.
1
 Q. Set No. Marking Scheme 2014-15 Distribution
of marks
67/ 67/ 67/ Accountancy (055)
2/1 2/2 2/3
Foreign – 67/2/1
Expected Answers / Value points
1 6 6 Q. In the absence of................... is charged. 1 Mark

Ans. (iv) no interest is charged.

2 5 5 Q. Kamal and Vimal............................correct treatment.

Ans. No, the accountant’s didn’t give correct treatment.

Reason: As credit balance in Profit and Loss Account indicates undistributed profits. It should
have been credited to Kamal and Vimal’s Capital Account.

Alternate Solution: 1 Mark

Journal
Date Particulars LF Dr (R) Cr (R)
Profit & Loss A/c Dr. 10,000
To Kamal’s Capital Account 6,000
To Vimal’s Capital A/c 4,000
(Being adjustment entry made)

3 1 4 Q. Anurag and Bhawana .........................partnership. 1 Mark

Ans.
Anurag’s Sacrifice = 3/10 x ½ = 3/20
1/2
Bhawana’s Sacrifice = 3/10 x ½ = 3/20
2
Anurag’s old share = 4/10 + 3/20 = 11/20
1/2
Bhawana’s old share = 3/10 + 3/20 = 9/20
2
Anurag and Bhawana’s profit sharing ratio = 11:9

4 2 3 Q. Deepak, Farukh and Lilly.........................of Farukh. 1 Mark

Ans.
(b) Credited to the Capital Accounts of all partners in their profit sharing ratio.

5 3 2 Q. Give the....................................... forfeiture of share. 1 Mark

Ans.
Forfeiture of shares means cancellation of shares and treating as forfeited the amount
actually received.
[ or any other suitable meaning ]
6 4 1 Q. ‘Samta Limited’ invited...........................applications was. 1 Mark

Ans. (iv) R 22,875

7 - - Q. State any three.......................can be utilized.

Ans.
The amount received as securities premium can be used other than ‘buy back of shares’ for 1 Mark
the following purposes : each

2
 In writing off the preliminary expenses of the company.
For writing off the expenses, commission or discount allowed on issue of shares or
debentures of the company.
For providing the premium payable on redemption of redeemable preference shares =
or debentures of the company. 3 Marks
For issuing Bonus Shares.

8 - - Q. A and B ..................................error.
Ans.
Journal
Date Particulars LF Dr (R) Cr (R)
2014 B’s Capital A/c Dr. 5,280
Apr. 1 To A’s Capital A/c 5,280 2
(Being interest on capital and salary
omitted, now adjusted)

Working Notes:
Calculation of Opening Capital :
A (R) B(R)
Closing Capitals 60,000 20,000
1
Less: Profits (48,000) (32,000)
Add: Drawings 10,000 20,000
Opening Capitals 22,000 8,000
=
Interest on Capital of A = 22,000 X 12/100 = 2,640 3 marks
Interest on Capital of B = 8,000 X 12/100 = 960
Table Showing Adjustment
A B Total
Interest on Capital (Cr.) 2,640 960 3,600
Salary to Partner (Cr.) 12,000 12,000
Profit to be Recovered (Dr.) 9.360 6,240 15,600
Adjustment 5,280 5,280
Cr. Dr.
9 10 9 Q. ‘Telecom Ltd............................Companies Act, 1956.
Ans.
Balance Sheet of Telecom Ltd.
As at ....................(As per revised schedule VI)
Particulars Note No. Amount Amount
Current year Previous year
EQUITY & LIABILITIES
I Shareholder’s funds :
a) Share Capital 1 9,96,000 1
Notes to Accounts :
Particulars R
(1) Share Capital
Authorised Capital :
80,00,000 equity shares of R 10 each 8,00,00,000 1
Issued Capital
1,00,000 equity shares of R 10 each 10,00,000 ½
Subscribed and fully paid
99,000 equity shares of R 10 each 9,90,000
Subscribed but not fully paid capital
1,000 equity shares of R 10 each 10,000
Less: Calls in arrears 4,000 6,000 9,96,000 ½
=3 marks

3
10 9 10 Q. ‘Panipat Blankets Ltd. ............................to the society.
Ans.
Books of Panipat Blankets Ltd.
Journal
Date Particulars LF Dr (R) Cr (R)
i. Machinery A/c Dr. 12,00,000
To Vendors A/c 12,00,000 1
(Being purchase of machinery)
ii. Vendors A/c Dr. 12,00,000
To Equity Share Capital A/c 10,00,000
To 9% Debentures A/c 2,00,000 1
(Being issue of equity shares and
debentures at par )
OR
Vendors A/c Dr. 10,00,000 ½
To Equity Share Capital A/c 10,00,000
(For issue of equity shares ) /
2
Vendors A/c Dr. 2,00,000 ½
To 9% Debentures A/c 2,00,000
(For issue debentures at par )
/
a) Values which the company wants to communicate to the society: (Any one)
2
Discharging Social responsibility
Generation of employment opportunities in rural areas 1

(OR any other suitable value.) =

3 Marks
11 - - Q. Joshi, Pandey and Agarwal......................... presented to his executors.
Ans.
Dr. Agarwal’s Capital A/c Cr.
Particulars Amount R Particulars Amount R
To Balance b/d ½ 39,000 By Joshi’s Capital A/c 1,44,000 ½
½
To Agarwal’s Executor A/c 4,12,560 By Pandey’s Capital A/c 1,44,000
By P/L Suspense A/c 72,000 1
½/
/
By Agarwal;s Loan A/c / ½ 84,000
2 By Interest on Agarwal’s Loan A/c 7,560 2½
2 /
/ 4,51,560 4,51,560
2/
Working notes: /
2 2
i. Calculation of Share of Profit : 2
4,80,000 x 1/5 x 9/12 = ` 72,000 =
4 Marks
ii. Share in Goodwill = 3 x 19,20,000/4 x 1/5 = ` 2,88,000
12 12 12 Q. Jain, Gupta and Singh................................the firm.
Ans.
In the books of Jain, Gupta and Singh
Profit & Loss Appropriation A/c
Dr. For the year ended 31st March 2014 Cr.
Particulars Amount (R) Particulars Amount (R)
To Interest on Capital: ½ By Profit for the year 1,47,000
Jain’s Capital A/c 29,400
Gupta’sCapitalA/c 44,100 ½ 1
Singh’s Capital A/c 73,500
1,47,000
½

1,47,000 1,47,000

4
 Working notes:
Calculation of Interest on Capital:
(R) ½
a) Interest on Jain’s Capital: 40,000
½
b) Interest on Gupta’s Capital: 60,000
c) Interest on Singh’s capital: 1,00,000 ½ =
Total: 2,00,000 4 Marks

The available profit is R 1,47,000 since the profit is less than interest, the available profit will
be distributed in the ratio of interest i.e. 2:3:5
13 14 15 Q. On 1-4-2013, Mohan.......................partners.
Ans.
Interest on Capital:
Mohan – 1,00,000 x 6 /100 = R 6,000 2
Sohan – 10,73,000 x 6/100 x 1/ 12 = R 5,365
Date Amount (`) Months Product
1.4.2013 50,000 1 50,000
1.5.2013 60,000 2 1,20,000 4
30.6.2013 55,000 3 1,65,000
30.9.2013 1,52,000 4 6,08,000
1.2.2014 65,000 2 1,30,000
Total: 10,73,000
Note: Full credit should be given if the examinee has done the question correctly by
any other method.
Alternate solution
Interest on Capital of Sohan = (50,000 x 6/100 x 1/12) + (60,000 x 6/100 x 2/12) + (55,000 x =
6/100 x 3/12) + (1,52,000 x 6/100 x 4/12) + (65,000 x 6/100 x 2/12) = R 5,365 6 Marks
14 15 13 Q. Chennai Fibers Ltd...................................2013-14.
Ans.
Dr. Cr.
9% Debentures A/c
Date Particulars LF Amount Date Particulars LF Amount
(R) (R)
2009 To Balance c/d 16,00,000 2008 By Debentures 14,40,000
Mar 31 Apr 1 app & all A/c
By Discount on 1,60,000
issse of
debentures A/c
16,00,000 1 16,00,000
2010 To Balance c/d 16,00,000 2009 By Balance b/d 16,00,000
Mar 31 Apr 1 1
2011 To Debenture 2,00,000 2010 By Balance b/d 16,00,000
Mar 31 holders A/c Apr 1
To Balance c/d 14,00,000
16,00,000 1 16,00,000
2012 To Debenture 3,00,000 2011 By Balance b/d 14,00,000
Mar 31 Holder A/c Apr 1
To Balance c/d 11,00,000
1
14,00,000 14,00,000 =
2013 To Debenture 4,00,000 2012 By Balance b/d 11,00,000
Mar 31 Holder A/c Apr 1 1 6 Marks
To Balance c/d 7,00,000
11,00,000 11,00,000
2014 To Debenture 7,00,000 2013 By Balance B/d 7,00,000
Mar 31 holders A/c Apr 1 1

7,00,000 7,00,000

5
15 13 14 Q. Chopra, Shah and Patel....................................amounts.
Ans.

Dr. Realisation A/c Cr.

Particulars Amt (R) Particulars Amt (R)
To Plant and Machinery 1,60,000 By Sundry Creditors 1,50,000
To Stock 1,50,000 By Mrs. Chopra’s Loan 1,30,000
To Sundry Debtors 2,00,000 By Repairs and Renewals 12,000
To Prepaid Insurance 4,000 reserve
To Investments 30,000 By Provision for bad debts 10,000
To Chopra’s capital A/c 1,30,000 By cash – Assets sold:
--Mrs. Chopra’s Loan Plant 1,00,000
To Cash- dishonoured bill paid 50,000 Stock 1,20,000
To Cash- Creditors 1,50,000 Debtors 1,60,000 3,80,000
To Cash- Expenses 8,000 By Chopra’s Capital- 20,000 1
Investments
By Loss Transferred to
Partners’ Capital A/c:
Chopra 90,000
Shah 60,000 1
Patel 30,000 1,80,000
8,82,000 8,82,000

Partner’s Capital A/c

Particulars Chopra Shah Patel Particulars Chopra Shah Patel
(R) (R) (R) (R) (R) (R)
To Realisation 20,000 By Balance b/d 1,00,000 1,50,000 20,000
(Investments) 3
To Realisation A/c 90,000 60,000 30,000 By Realisation 1,30,000 ___ ___
(Loss) 1 A/c (Loan)
To Cash A/c 1 1,20,000 90,000 ___ ___ ___ 10,000 1
By Cash A/c

2,30,000 1,50,000 30,000 2,30,000 1,50,000 30,000

Dr. Cash A/c Cr.

Particulars Amount (R) Particulars Amount (R)
To balance b/d ½ 28,000 By Realisation A/c – 50,000
To Realisation A/c – Sale of ½ 3,80,000 (Dishonoured bill)
Assets By Realisation A/c 1,50,000 2
To Patel’s Capital A/c 10,000 (Creditors paid)
1 =
By Realisation A/c 8000 6 Marks
(Expenses)
By Chopra’s capital A/c 1,20,000
By Shah’s Capital A/c 90,000
4,18,000 4,18,000
16 - - Q. Nigam Ltd............................... in the books of Nigam Ltd.
Ans.

6
 Books of Nigam Ltd.
Journal
Date Particulars LF Dr. Amt Cr. Amt
(R) (R )
i. Bank A/c Dr. 36,000
To Equity Share Application A/c 36,000 ½
(For application money received)
Equity Share Application A/c Dr. 36,000
ii. To Equity Share Capital A/c 30,000 1
To Equity share Allotment A/c 6,000
(For application money transferred to share
capital )
iii. Equity Share Allotment A/c Dr. 45,000
Discount on issue of shares A/c Dr. 15,000 1
To Equity share Capital A/c 60,000
(For allotment money due)
iv. Bank A/c Dr. 38,220
To Equity share Allotment A/c 38,220
(For allotment money received) 1
OR
Bank A/c Dr. 38,220
Calls in arrears A/c Dr. 780
To Equity Share Allotment A/c 39,000
(For allotment money received except on 300
shares and the advance adjusted)

v. Equity Share first & final Call A/c Dr. 60,000

½
To Equity share capital A/c 60,000
(For first and final call due)
vi. Bank A/c Dr. 58,200
To Equity Share First and final Call A/c 58,200
(For first and final call received except on 450
1
shares)
OR
Bank A/c Dr. 58,200
Calls in arrears A/c Dr. 1,800
To Equity Share first and final call A/c 60,000
(For first and final call money received except
on 450 shares)
vii. Equity Share capital A/c Dr. 4,500
To Discount on issue of shares A/c 450
To Equity share Allotment A/c 780
To Equity share first and final call A/c 1,800
To Share forfeiture A/c 1,470
1
(For 450 shares forfeited)
OR
Equity Share capital A/c Dr. 4,500
To Discount on issue of shares A/c 450
To Calls in arrears A/c 2,580
To Share forfeiture A/c 1,470
(For 450 shares forfeited)

7
 viii. Bank A/c Dr. 1,800
Discount on issue of shares A/c Dr. 200 1
To Equity Share Capital A/c 2,000
(For shares reissued for R 9 per share fully
paid up)
ix. Share forfeiture A/c Dr. 870
To Capital reserve A/c 870 1
(For forfeiture balance transferred to capital
=
reserve)
8 Marks

16 - - Q. Guru Ltd.....................................Guru Ltd.

OR Ans.
Books of Guru Ltd.
Journal
Date Particulars L.F. Debit ( ) Credit ( )

(i) Bank A/c Dr. 10,00,000

1
To Equity Share Application & 10,00,000
Allotment A/c
(Being application and allotment money
received with premium )
(ii) Equity Share App & Allotment A/c Dr. 10,00,000
To Equity Share Capital A/c 4,00,000
To Calls in advance A/c 1,00,000
To Securities premium/ Securities 4,00,000
premium Reserve A/c 2
To Bank A/c 1,00,000
(Being application and allotment money
transferred to share capital )
(iii) Equity Share First & final call A/c Dr. 8,00,000
To Equity share Capital a/c 4,00,000
1
To securities premium/ Securities 4,00,000
premium Reserve A/c
(Being first call money due with premium)
(iv) Bank A/c Dr. 6,86,000
Calls in advance A/c Dr. 1,00,000
To Equity Share First and final call A/c 7,86,000
(Being first call money received)
OR 1
Bank A/c Dr. 6,86,000
Calls in arrears A/c Dr. 14,000
Calls in advance A/c Dr. 1,00,000
To Equity Share First and final call A/c 8,00,000
(Being first call money received)
(v) Equity Share capital A/c Dr. 16,000
Securities premium A/c Dr. 8,000
To Share forfeiture A/c 10,000 1
To Equity share First and final call A/c 14,000
/ Calls in arrear A/c

8
 (Being 1600 shares forfeited)
(vi) Bank A/c Dr. 14,400
Share forfeited A/c Dr. 1,600
1
To Equity share Capital A/c 16,000
(Being shares reissued)
(vii) Share forfeited A/c Dr. 8,400
To Capital reserve A/c 8,400 1
(Being balance of share forfeited =
transferred to capital reserve A/c) 8 Marks

17 17 17 Q. A,B and C.......................... retirement.

Ans.
Revaluation A/c
Dr Cr
Particulars Amt (R) Particulars Amt (R)
To machinery A/c 9,600 By Provident fund A/c ½ 500
To Patents A/c ½ 2,000 By Investment A/c 11,700
½ 2 Marks
To profit transferred to
Partner’s Capital A/c:
A 300
B 200 ½
C 100 600
12,200 12,200

Partner’s Capital A/c

Particulars A B C Particulars A B C
(R) (R) (R) (R) (R) (R)
To C’s Capital 540 360 By Balance b/d 80,000 73,000 40,000 6 Marks
A/c By A’s Capital A/c 540
To Investment 31,700 By B’s Capital A/c 360
A/c By General 10,500 7,000 3,500
12,800
To C’s loan A/c Reserve A/c
To Current 11,800 By revaluation A/c 300 200 100
A/c By current A/c 11,800
To Balance c/d 1,02,060 68,040 ---

1,02,600 80,200 44,500 1,02,600 80,200 44,500

Working Notes:
A’s capital = R 90,260
B’s capital = R 79,840
Total capital = R 1,70,100
Capitals of A and B in new ratio =
A = 3/5 x 1,70,100 = 1,02,060
B = 2/5 x 1,70,100 = 68,040 =
8 Marks

17 17 17 Q. O, R and S...............................Capital accounts.

OR OR OR Ans.

9
 Revaluation A/c
Dr Cr
Particulars Amt (R) Particulars Amt (R)
½
To liability for bills 7,004 By land and building A/c 35,000
½
discounted By plant and machinery A/c ½ 6,750
To Stock A/c ½ 27,400 By Partner’s current A/c
To furniture A/c 16,000 (loss):
3 Marks
To Investments A/c ½ 7,300 O 7,977
R 5,318 ½
S 2,659 15,954

57,704 57,704

Partner’s Current A/c

Particulars O R S Particulars O R S
(R) (R) (R) (R) (R) (R)
To balanceb/d 7,000 By Balance b/d 4,000 6,000
To revaluation By General reserve 7,500 5,000 2,500
7,977 5,318 2,659 By profit and loss 3,500 2,333 1,167
a/c 4 Marks
a/c
Tobalancec/d 97,023 45,015 82,008
By premium for 15,000
goodwill
By capital A/cs 75,000 50,000 75,000

1,05,000 57,333 84,667 1,05,000 57,333 84,667

Partners’ Capital A/c

Particulars O R S Particulars O R S
(R) (R) (R) (R) (R) (R)
To current A/cs 75,000 50,000 75,000 By Balance b/d 1,75,000 1,50,000 1,25,000
To balance c/d 1,00,000 1,00,000 50,000
1,75,000 1,50,000 1,25,000 1,75,000 1,50,000 1,25,000

H’s Capital A/c

Dr Cr 1
Particulars Amt (R) Particulars Amt (R)
To Balance c/d 50,000 By Bank A/c 50,000

=
50,000 50,000 8 Marks

PART B
(Financial Statements Analysis)
18 - - Q. Which..........................................shares.
Ans.
(iii) Received R 74,000 from debtors. 1 Mark

19 - - Q. The accountant...............................reason.
Ans. Yes, he is correct because it is an appropriation of profits.
1 Mark
20 20 - Q. Under which.................................. investments.
Ans.
10
 S.No. Items Headings Sub headings
1 Bank Overdraft Current liabilities Short term borrowings

2 Cash and cash equivalents Current assets Cash and cash

equivalents
3 Securities premium Shareholders’ funds Reserves and surplus

4 Negative Balance of Shareholders’ funds Reserves and surplus

½x8
statement of Profit and Loss
=
5 Goodwill Non current assets Fixed assets- 4 Marks
intangible

6 Trademark Non current assets Fixed assets-

intangible

7 5 years loan obtained from Non current liabilities Long term borrowings
SBI
8 Investments Non current assets Non current
investments

21 - 21 Q. The current..........................................creditors.
Ans.
Reason

i) Decrease Current assets will decrease with no change in current

liabilities.
=
ii) No change Both current assets and current liabilities are not affected. 4 Marks

iii) No change Both current assets and current liabilities are not affected.

iv) Increase Both current assets and current liabilities will decrease
with same amount.

22 22 22 Q. The motto......................................... to communicate.

Ans.
a) Net Profit Ratio

As on 31-03-2013 = Net Profit after tax / Revenue from operations x 100 1

= 8,00,000 / 40,00,000 x 100 2 Marks
½
= 20%
As on 31-03-2014 = Net Profit after tax / Revenue from operations x 100
= 16,00,000 / 60,00,000 x 100
= 26.67% ½

1 mark for formula & ½ mark for calculation of net profit ratio of each year. 1+ (½ + ½ ) = 2
b) Values: (Any two)
Promoting healthy living.
Participation of Employees in excess profits.
Treating employees a part of the company.
Ethical practices of company 2 Marks
Hardwork and honesty of employees.
Serving the organisation with dignity. =
(Or any other suitable value) 4 Marks

11
23 23 23 Q. Following ..............................statement.
Ans.
Cash flow statement of Solar Power Ltd.
For the year ended 31st March 2014 as per AS-3 (Revised)
Particulars Details (R) Amount (R)
Cash Flows from Operating Activities:
Net Profit before tax & extraordinary items 4,00,000
Add: Non cash and non-operating charges
Goodwill written off 3,20,000/2,88,000
Depreciation on machinery 2,64,000
Loss on sale of machinery 8,000
9,92,000/9,60,000
Operating profit before working capital changes
Less: Increase in Current Assets
(1,08,000)
Increase in trade receivables
(32,000)
Increase in inventories
Less: Decrease in Current Liabilities
(1,00,000)
Decrease in trade payables
(1,08,000)
Decrease in short term provisions
6,44,000/
2
Cash generated from Operating Activities
6,12,000
Cash flows from Investing Activities :
(11,76,000)
Purchase of machinery
24,000
Sale of machinery 2
(11,52,000)
Cash used in investing activities
Cash flows from Financing Activities:
4,00,000
Issue of share capital
2,80,000
Money raised from long term borrowings
6,80,000 2
Cash from financing activities

1,72,000/
Net increase in cash & cash equivalents
1,40,000
Add: Opening balance of cash & cash equivalents:
Current Investments 4,48,000
16,20,000
Cash & cash equivalents

Closing Balance of cash & cash equivalents:

9,60,000
Current Investments
12,80,000
Cash & cash equivalents
(No marks for cash & cash equivalents)

Working Notes:
Machinery A/c.

Particulars R Particulars R
To Balance b/d 40,00,000 By Bank a/c 24,000
To Bank A/c (Bal. Figure) 11,76,000 By Accumulated Depreciation 64,000
By Loss on sale of machinery 8,000
By Balance c/d 50,80,000
51,76,000 51,76,000

12
 Accumulated Depreciation A/c

Particulars R Particulars R
To Machinery A/c 64,000 By Balance b/d 6,00,000
To balance c/d 8,00,000 By Depreciation a/c (Bal fig.) 2,64,000
8,64,000 8,64,000

Notes:
(I) If short term provision is not treated as current liabilities by an examinee:
Decrease in short term provisions will not be shown.

1. If short term provision is treated as provision for doubtful debts.

Operating profit before working capital changes will be R 8,84,000 or
R 8,52,000.
There is no change in the cash flow from the three activities and full credit is
to be given for this treatment also.

2. If short term provision is treated as provision for tax:

Net profit before tax and extraordinary items will be R 6,00,000.
Operating profit before working capital changes will be R 11,92,000 or R
11,60,000.
Cash generated from operations before tax will be R 9,52,000 or R 9,20,000
Tax paid off R 3,08,000 will be deducted for calculating cash from operating
activities.
There is no change in the cash flow from the three activities and full credit is
to be given for this treatment also.

3. If short term provision is treated as proposed dividend:

Net profit before tax and extraordinary items will be R 6,00,000.
Cash from operating activities will be R 9,52,000 or R 9,20,000
Cash used in investing activity will remain same i.e. R (11,52,000)
Cash from financing activity will be R 3,72,000

(II) If current investment is treated as current asset by an examinee:

Increase in current investment R 5,12,000 will be deducted from operating
profit before working capital changes.
1. If Short term provision is treated as current liability:
Operating profit before working capital changes will be R 9,92,000 or R
9,60,000.
Cash from operating activities will be R 1,32,000 or 1,00,000.
Cash used in investing activity will remain same i.e. R (11,52,000) and cash
from financing activity will also remain same i.e. R 6,80,000.

2. When short term provision is treated as proposed dividend:

Net profit before tax and extraordinary items will be R 6,00,000.
Operating profit before working capital changes will be R 11,92,000 or R
11,60,000
Cash from operating activities will be R 4,40,000 or R 4,08,000
Cash used in investing activity will remain same i.e. R (11,52,000)
Cash from financing activity will be R 3,72,000

3. When short term provision is treated as provision for tax:

Net profit before tax and extraordinary items will be R 6,00,000.
Operating profit before working capital changes will be R 11,92,000 or R
11,60,000
Cash generated from operations R 9,52,000 or R 9,20,000
13
 Tax paid off R 3,08,000 will be deducted for calculating cash from operating
activities.
Cash from operating activities will be R 6,46,000 or R 6,14,000
Cash used in investing activity will remain same i.e. R (11,52,000)
Cash from financing activity will be R 6,80,000 or R 6,48,000

4. If short term provision is treated as provision for doubtful debts:

Net profit before tax and extraordinary items will be R 4,00,000.
Operating profit before working capital changes will be R 8,84,000 or R
8,52,000.
Cash from operating activities will be R 6,44,000 or R 6,12,000
Cash used in investing activity will remain same i.e. R (11,52,000)
Cash from financing activity will be R 6,80,000 or 6,48,000
PART B
(Computerised Accounting)
18 19 19 Q. The term...................of the table.
Ans. 1 Mark
(iv) Horizontal row of the table
19 18 18 Q. ‘SQL’ stand......................questions.
Ans. 1 Mark
(iii) Structured Query Language
20 22 21 Q. State any two.................System.
Ans.
Advantages of CAS
Following are the advantages of computerized accounting system (CAS) (Any Two)
1. Timely generation of reports and information in desired format. 2
2. Efficient record keeping.
3. Ensures effective control over the system.
4. Economy in the processing of accounting data.
5. Confidentiality of data is maintained.
Limitations of CAS
Following are the limitation of CAS software: (Any Two)
1. Faster obsolescence of technology necessitates investment in shorter period of time.
2. Data may be lost or corrupted due to power interruptions. 2
3. Data are prone to hacking.
4. Un-programmed and un-specified reports cannot be generated. =
4 marks
21 20 22 Q. State the features.................software.
Ans.
Following are the features of accounting softeware:
1. Do all basic accounting functions,
2. Manage your stores,
3. Do the job costing,
4. Manage payroll, =
5. Get many MIS (Management information System) 4 Marks
6. File tax returns
7. Maintain budgets etc
8. Calculate interest pending amounts
9. Manage data over different locations and synchronize it and many more other
features

14
22 21 20 Q. State the steps...........................using Tally.
Ans.
The following are the steps to construct BRS in tally:
i. Bring up the monthly summary of bank book.
ii. Bring your cursor to the first month and press enter. This brings up the vouchers for
the month. Since this is a bank account, an additional button F5 : reconcile will be
visible on the right Press F5. =
iii. The display now becomes an Edit screen in Reconciliation mode. The primary 4 Marks
components are : A column for the ‘Bankers Date’.
iv. The ‘Reconciliation’ at the bottom of the screen.
v. Balance as per company’s books.
vi. Amounts not reflected in banks
vii. Balance as per bank.
23 - - Q. Name the table.....................five advantages.
Ans.
‘Pivot table. Advantages of pivot table are:
1. User friendly.
2. Focus on results. =
3. Multiple summerisation of data. 6 Marks
4. Filtering,sorting ,grouping etc. makes it possible to focus on information.
5. Presenting concise,attsctive and annotated online or printed reports.
Analysis of related tables is facilitated. (with suitable explanation).

15
 Q. Set No. Marking Scheme 2014-15 Distribution
of marks
67 67 67 Accountancy (055)
/2 /2 /2 Foreign – 67/2/2
/1 /2 /3 Expected Answers / Value points
3 1 4 Q. Anurag and Bhawana .........................partnership. 1 Mark

Ans.
Anurag’s Sacrifice = 3/10 * ½ = 3/20
1/2
Bhawana’s Sacrifice = 3/10 * ½ = 3/20
2
Anurag’s old share = 4/10 + 3/20 = 11/20
1/2
Bhawana’s old share = 3/10 + 3/20 = 9/20
2
Anurag and Bhawana’s profit sharing ratio = 11:9
4 2 3 Q. Deepak, Farukh and Lilly.........................of Farukh. 1 Mark

Ans.
(b) Credited to the Capital Accounts of all partners in their profit sharing ratio.
5 3 2 Q. Give the....................................... forfeiture of share. 1 Mark

Ans.
Forfeiture of shares means cancellation of shares and treating as forfeited the amount
actually received.
[ or any other suitable meaning ]
6 4 1 Q. ‘Samta Limited’ invited...........................applications was. 1 Mark

Ans. (iv) R 22,875

2 5 5 Q. Kamal and Vimal............................correct treatment.

Ans. No, the accountant’s didn’t give correct treatment.

Reason: As credit balance in Profit and Loss Account indicates undistributed profits. It should
have been credited to Kamal and Vimal’s Capital Account.

Alternate Solution: 1 Mark

Journal
Date Particulars LF Dr (R) Cr (R)
Profit & Loss A/c Dr. 10,000
To Kamal’s Capital Account 6,000
To Vimal’s Capital A/c 4,000
(Being adjustment entry made)
1 6 6 Q. In the absence of................... is charged. 1 Mark

Ans. (iv) no interest is charged.

- 7 - Q. State any three purposes...........................can be utilised.

Ans
The amount received as securities premium can be used other than ‘issue of bonus shares’ 1 Mark
for the following purposes : . (Any three) each
In writing off the preliminary expenses of the company.
For writing off the expenses, commission or discount allowed on issue of shares or =
debentures of the company. 3 Marks
For providing the premium payable on redemption of redeemable preference shares
or debentures of the company.
For buy back of its own shares.

16
- 8 - Q. X and Y ..................................error.
Ans.
Journal
Date Particulars LF Dr (R) Cr (R)
2014 y’s Capital A/c Dr. 2,856 1
April 1 To x’s Capital A/c 2,856
(Being interest on capital and salary
omitted, now adjusted)

Working Notes:
Calculation of Opening Capital :
X (R) Y(R)
1
Closing Capitals 1,30,000 1,00,000
Less: Profits (51,000) (34,000)
Add: Drawings 18,000 9,000
Opening Capitals 97,000 75,000
Interest on Capital @ 12% p.a. 11,640 9,000

X Y Total
Omission of Interest on Capital (Cr.) 11,640 9,000 20,640 2
Salary to X ( Cr.) 9,000 9,000 =
Net loss to firm (Dr.) 17,784 11,856 29,640 4 Marks
Net Effect 2,856(Cr.) 2,856(Dr.) ---

10 9 10 Q. ‘Panipat Blankets Ltd. ............................to the society.

Ans.
Books of Panipat Blankets Ltd.
Journal
Date Particulars LF Dr (R) Cr (R)
i. Machinery A/c Dr. 12,00,000
To Vendors A/c 12,00,000 1
(Being purchase of machinery)
ii. Vendors A/c Dr. 12,00,000
To Equity Share Capital A/c 10,00,000
To 9% Debentures A/c 2,00,000 1
(Being issue of equity shares and
debentures at par )
OR
Vendors A/c Dr. 10,00,000
To Equity Share Capital A/c 10,00,000
(For issue of equity shares )

Vendors A/c Dr. 2,00,000

To 9% Debentures A/c 2,00,000
(For issue debentures at par )

b) Values which the company wants to communicate to the society: (Any one)
Discharging Social responsibility 1
Generation of employment opportunities in rural areas
=
(OR any other suitable value.) 3 Marks

9 10 9 Q. ‘Telecom Ltd............................Companies Act, 1956.

Ans.
17
 Balance Sheet of Telecom Ltd.
As at ....................(As per revised schedule VI)
Particulars Note No. Amount Amount
Current year Previous year
EQUITY & LIABILITIES
I Shareholder’s funds :
a) Share Capital 1 9,96,000 1

Notes to Accounts :
Particulars R
(1) Share Capital
Authorised Capital :
80,00,000 equity shares of R 10 each 8,00,00,000 1
Issued Capital
1,00,000 equity shares of R 10 each 10,00,000 ½
Subscribed and fully paid
99,000 equity shares of R 10 each 9,90,000
Subscribed but not fully paid capital
1,000 equity shares of R 10 each 10,000 9,96,000 ½
Less: Calls in arrears 4,000 6,000 =
3 Marks

- 11 - Som, Sudha and Surbhi...........executors.

Ans.
Dr. Surbhi’s Capital A/c Cr.
Particulars Amount (R) Particulars Amount (R)
To Balance b/d ½ 24,000 By Som’s Capital A/c ½ 76,875
To Surbhi’s Executor 1,84,538 By Sudha’s Capital A/c 76,875 ½
A/c 1 By P/L Suspense A/c 1 38,438
By Surbhi’s Loan A/c 16,350 ½
2,08,538 2,08,538

Working notes:
i. Calculation of Share of Profit :
2,56,250 x 1/5 x 9/12 = R 38,437.50 or R 38,438 =
4 Marks
ii. Share in Goodwill = 3 x 10,25,000/4 x 1/5 = R 1,53,750
Som’s Share = R 76,875
Sudha’s share = R 76,875
12 12 12 Q. Jain, Gupta and Singh................................the firm.
Ans.
In the books of Jain, Gupta and Singh
Profit & Loss Appropriation A/c
Dr. For the year ended 31st March 2014 Cr.
Particulars Amount (R) Particulars Amount (R)
To Interest on Capital: ½ By Profit for the year 1,47,000
Jain’s Capital A/c 29,400
Gupta’sCapitalA/c 44,100 ½ 1 =
Singh’s Capital A/c 73,500
1,47,000 4 Marks
½

1,47,000 1,47,000
Working notes:

18
 Calculation of Interest on Capital:
(R) ½
a) Interest on Jain’s Capital: 40,000
½
b) Interest on Gupta’s Capital: 60,000
c) Interest on Singh’s capital: 1,00,000 ½
Total: 2,00,000

The available profit is R 1,47,000 since the profit is less than interest, the available profit will
be distributed in the ratio of interest i.e. 2:3:5

15 13 14 Q. Chopra, Shah and Patel....................................amounts.

Ans.

Dr. Realisation A/c Cr.

Particulars Amt (R) Particulars Amt (R)
To Plant and Machinery 1,60,000 By Sundry Creditors 1,50,000
To Stock 1,50,000 By Mrs. Chopra’s Loan 1,30,000
To Sundry Debtors 2,00,000 By Repairs and Renewals 12,000
To Prepaid Insurance 4,000 reserve
To Investments 30,000 By Provision for bad debts 10,000
To Chopra’s capital A/c 1,30,000 By cash – Assets sold:
--Mrs. Chopra’s Loan Plant 1,00,000
To Cash- dishonoured bill paid 50,000 Stock 1,20,000
To Cash- Creditors 1,50,000 Debtors 1,60,000 3,80,000
To Cash- Expenses 8,000 By Chopra’s Capital- 20,000 1
Investments
By Loss Transferred to
Partners’ Capital A/c:
Chopra 90,000
Shah 60,000 1
Patel 30,000 1,80,000
8,82,000 8,82,000

Partner’s Capital A/c

Particulars Chopra Shah Patel Particulars Chopra Shah Patel
(R) (R) (R) (R) (R) (R)
To Realisation 20,000 By Balance b/d 1,00,000 1,50,000 20,000
(Investments)
To Realisation A/c 90,000 60,000 30,000 By Realisation 1,30,000 ___ ___
(Loss) 1 3
A/c (Loan)
To Cash A/c 1 1,20,000 90,000 ___ ___ ___ 10,000 1
By Cash A/c

2,30,000 1,50,000 30,000 2,30,000 1,50,000 30,000

Dr. Cash A/c Cr.

Particulars Amount (R) Particulars Amount (R)
To balance b/d ½ 28,000 By Realisation A/c – 50,000
To Realisation A/c – Sale of ½ 3,80,000 (Dishonoured bill)
Assets By Realisation A/c 1,50,000
To Patel’s Capital A/c 10,000 (Creditors paid)
2
By Realisation A/c 8000 1
(Expenses) =
By Chopra’s capital A/c 1,20,000 6 Marks
By Shah’s Capital A/c 90,000
4,18,000 4,18,000
13 14 15 Q. On 1-4-2013, Mohan.......................partners.
19
 Ans.Interest on Capital:
Mohan – 1,00,000 x 6 /100 = R 6,000
Sohan – 10,73,000 x 6/100 x 1/ 12 = R 5,365 2
Date Amount (`) Months Product
1.4.2013 50,000 1 50,000
1.5.2013 60,000 2 1,20,000
30.6.2013 55,000 3 1,65,000
30.9.2013 1,52,000 4 6,08,000
1.2.2014 65,000 2 1,30,000 4
Total: 10,73,000
Note: Full credit should be given if the examinee has done the question correctly by
any other method.
Alternate solution
Interest on Capital of Sohan = (50,000 x 6/100 x 1/12) + (60,000 x 6/100 x 2/12) + (55,000 x
6/100 x 3/12) + (1,52,000 x 6/100 x 4/12) + (65,000 x 6/100 x 2/12) = R 5,365 =
6 Marks
14 15 13 Q. Chennai Fibers Ltd...................................2013-14.
Ans.
Dr. Cr.
9% Debentures A/c
Date Particulars LF Amount Date Particulars LF Amount
(R) (R)
2009 To Balance c/d 16,00,000 2008 By Debentures 14,40,000
Mar 31 Apr 1 app & all A/c
By Discount on 1,60,000
issse of
debentures A/c
16,00,000 1 16,00,000
2010 To Balance c/d 16,00,000 2009 By Balance b/d 16,00,000
Mar 31 Apr 1 1
2011 To Debenture 2,00,000 2010 By Balance b/d 16,00,000
Mar 31 holders A/c Apr 1
To Balance c/d 14,00,000
16,00,000 1 16,00,000
2012 To Debenture 3,00,000 2011 By Balance b/d 14,00,000
Mar 31 Holder A/c Apr 1
To Balance c/d 11,00,000
1
14,00,000 14,00,000 =
2013 To Debenture 4,00,000 2012 By Balance b/d 11,00,000
Mar 31 Holder A/c Apr 1 1 6 Marks
To Balance c/d 7,00,000
11,00,000 11,00,000
2014 To Debenture 7,00,000 2013 By Balance B/d 7,00,000
Mar 31 holders A/c Apr 1 1

7,00,000 7,00,000

- 16 - Q. Vibhu Ltd....................... Vibhu Ltd.

Ans.
Books of Vibhu Ltd.
Journal
Date Particulars L.F. Debit ( ) Credit ( )

(i) Bank A/c Dr. 50,00,000

1
To Equity Share Application & 50,00,000
Allotment A/c
(Being application and allotment money
received with premium )
20
 (ii) Equity Share App & Allotment A/c Dr. 50,00,000
To Equity Share Capital A/c 20,00,000 1½
To Calls in advance A/c 10,00,000
To Securities premium/ Securities 20,00,000
premium Reserve A/c
(Being application and allotment
money transferred to share capital )
(iii) Equity Share First & final call A/c Dr. 40,00,000
1
To Equity share Capital a/c 20,00,000
To securities premium/ Securities 20,00,000
premium Reserve A/c
(Being first call money due with premium)
(iv) Bank A/c Dr. 29,55,000
Calls in advance A/c Dr. 10,00,000
To Equity Share First and final call A/c 39,55,000
(Being first call money received)
OR
Bank A/c Dr. 29,55,000 1
Calls in arrears A/c Dr. 45,000
Calls in advance A/c Dr. 10,00,000
To Equity Share First and final call A/c 40,00,000
(Being first call money received)

(v) Equity Share capital A/c Dr. 60,000

Securities premium A/c Dr. 30,000
To Share forfeiture A/c 45,000 1½
To Equity share First and final call A/c 45,000
/ Calls in arrear A/c
(Being 600 shares forfeited)
(vi) Bank A/c Dr. 32,000
Share forfeited A/c Dr. 8,000
To Equity share Capital A/c 40,000 1
(Being shares reissued)
(vii) Share forfeited A/c Dr. 22,000
To Capital reserve A/c 22,000
(Being balance of share forfeited 1
transferred to capital reserve A/c) =
8 Marks
- 16 - Q. Shakti Ltd.................................Shakti Ltd.
OR Ans.
Books of Vibhu Ltd.
Journal
Date Particulars L.F. Debit ( ) Credit ( )

(i) Bank A/c Dr. 1,44,000

To Equity Share Application & 1,44,000
½
Allotment A/c
(Being application and allotment money
received)
21
(ii) Equity Share App & Allotment A/c Dr. 1,44,000
Discount on issue of shares A/c Dr. 43,200
To Equity Share Capital A/c 1,87,200 1
(Being application and allotment
money transferred to share capital )
(iii) Equity Share First call A/c Dr. 2,16,000
To Equity share Capital a/c 2,16,000 ½
(Being first call money due)
(iv) Bank A/c Dr. 2,14,200
To Equity Share First call A/c 2,14,200
(Being first call money received) ½
OR
Bank A/c Dr. 2,14,200
Calls in arrears A/c Dr. 1,800
To Equity Share First call A/c 2,16,000
(Being first call money received)

(v) Equity Share capital A/c Dr. 3,360

To Share forfeiture A/c 1,200 1
To Equity share First call A/c / Calls in 1,800
arrear A/c
To Discount on issue of shares A/c 360
(Being 600 shares forfeited)
(vi) Equity Share Second and final call A/c Dr. 3,14,160
To Equity share Capital a/c 3,14,160 ½
(Being final call money due)
(vii) Bank A/c Dr. 3,11,960
To Equity Share Second & final call A/c 3,11,960
(Being final call money received)
OR
1
Bank A/c Dr. 3,11,960
Calls in arrears A/c Dr. 2,200
To Equity Share Second & final call A/c 3,14,160
(Being final call money received)
(viiii) Equity Share capital A/c Dr. 5,000
To Share forfeiture A/c 2,500
To Equity share second & final call A/c 2,200 1
/ Calls in arrear A/c
To Discount on issue of shares A/c 300
(Being 500 shares forfeited)
(ix) Bank A/c Dr. 8,000
Discount on issue of shares A/c Dr. 600
1
Share forfeited A/c Dr. 1,400
To Equity share Capital A/c 10,000
(Being shares reissued)
(x) Share forfeited A/c Dr. 1,800
To Capital reserve A/c 1,800 1
(Being balance of share forfeited
=
transferred to capital reserve A/c)
8 Marks
22
17 17 17 Q. A,B and C.......................... retirement.
Ans.
Revaluation A/c
Dr Cr
Particulars Amt (R) Particulars Amt (R)
To machinery A/c 9,600 By Provident fund A/c ½ 500
To Patents A/c ½ 2,000 By Investment A/c 11,700
½
To profit transferred to
Partner’s Capital A/c:
2 Marks
A 300
B 200 ½
C 100 600
12,200 12,200

Partner’s Capital A/c

Particulars A B C Particulars A B C
(R) (R) (R) (R) (R) (R)
To C’s Capital 540 360 By Balance b/d 80,000 73,000 40,000
A/c By A’s Capital A/c 540
To Investment 31,700 By B’s Capital A/c 360 6 Marks
A/c By General 10,500 7,000 3,500
12,800
To C’s loan A/c Reserve A/c
To Current 11,800 By revaluation A/c 300 200 100
A/c By current A/c 11,800
To Balance c/d 1,02,060 68,040 ---

1,02,600 80,200 44,500 1,02,600 80,200 44,500

2 marks for Capital A/c of each partner.

Working Notes:
A’s capital = R 90,260
B’s capital = R 79,840
Total capital = R 1,70,100
Capitals of A and B in new ratio = =
A = 3/5 x 1,70,100 = 1,02,060 8 Marks
B = 2/5 x 1,70,100 = 68,040
17 17 17 Q. O, R and S...............................Capital accounts.
OR OR OR Ans.

Revaluation A/c
Dr Cr
Particulars Amt (R) Particulars Amt (R)
½
To liability for bills 7,004 By land and building A/c 35,000
½
discounted By plant and machinery A/c ½ 6,750
To Stock A/c ½ 27,400 By Partner’s current A/c
To furniture A/c 16,000 (loss):
To Investments A/c ½ 7,300 O 7,977
R 5,318 ½
3 Marks
S 2,659 15,954

57,704 57,704

23
 Partner’s Current A/c
Particulars O R S Particulars O R S
(R) (R) (R) (R) (R) (R)
To balanceb/d 7,000 By Balance b/d 4,000 6,000
To revaluation By General reserve 7,500 5,000 2,500
7,977 5,318 2,659 By profit and loss 3,500 2,333 1,167
a/c
a/c
Tobalancec/d 97,023 45,015 82,008
By premium for 15,000
goodwill 4 Marks
By capital A/cs 75,000 50,000 75,000

1,05,000 57,333 84,667 1,05,000 57,333 84,667

Partners’ Capital A/c

Particulars O R S Particulars O R S
(R) (R) (R) (R) (R) (R)
To current A/cs 75,000 50,000 75,000 By Balance b/d 1,75,000 1,50,000 1,25,000
To balance c/d 1,00,000 1,00,000 50,000
1,75,000 1,50,000 1,25,000 1,75,000 1,50,000 1,25,000

H’s Capital A/c 1

Dr Cr
Particulars Amt (R) Particulars Amt (R)
To Balance c/d 50,000 By Bank A/c 50,000
=
8 Marks
50,000 50,000

PART B
(Financial Statements Analysis)
- 18 - Q. While..................................activity.
Ans.
(ii) Financing Activity. 1 Mark

- 19 - Q. While.....................................reason.
Ans. 1 Mark
He was correct because depreciation charged on machinery is a non cash item.
20 20 - Q. Under which.................................. investments.
Ans.
S.No. Items Headings Sub headings
1 Bank Overdraft Current liabilities Short term borrowings

2 Cash and cash equivalents Current assets Cash and cash

equivalents
3 Securities premium Shareholders’ funds Reserves and surplus

4 Negative Balance of Shareholders’ funds Reserves and surplus

statement of Profit and Loss
½x8
5 Goodwill Non current assets Fixed assets- =
intangible 4 Marks

6 Trademark Non current assets Fixed assets-

intangible

24
 7 5 years loan obtained from Non current liabilities Long term borrowings
SBI
8 Investments Non current assets Non current
investments

- 21 - Q. The debt................................months.
Ans.

Reason

i) Decrease Debt will decrease with no change in equity.

ii) Decrease Equity will increase with no change in debt.

=
iii) Decrease Equity will increase with no change in debt. 4 Marks

iv) No Change Neither equity nor debt will be affected.

22 22 22 Q. The motto......................................... to communicate.

Ans.
a) Net Profit Ratio

As on 31-03-2013 = Net Profit after tax / Revenue from operations x 100 1

= 8,00,000 / 40,00,000 x 100 2 Marks
½
= 20%
As on 31-03-2014 = Net Profit after tax / Revenue from operations x 100
= 16,00,000 / 60,00,000 x 100
= 26.67% ½

1 mark for formula & ½ mark for calculation of net profit ratio of each year. 1+ (½ + ½ ) = 2
b) Values: (Any two)
Promoting healthy living.
Participation of Employees in excess profits.
Treating employees a part of the company.
Ethical practices of company 2 Marks
Hardwork and honesty of employees.
Serving the organisation with dignity. =
(Or any other suitable value) 4 Marks
23 23 23 Q. Following ..............................statement.
Ans.

25
 Cash flow statement of Solar Power Ltd.
For the year ended 31st March 2014 as per AS-3 (Revised)
Particulars Details (R) Amount (R)
Cash Flows from Operating Activities:
Net Profit before tax & extraordinary items 4,00,000
Add: Non cash and non-operating charges
Goodwill written off 3,20,000/2,88,000
Depreciation on machinery 2,64,000
Loss on sale of machinery 8,000
9,92,000/9,60,000
Operating profit before working capital changes
Less: Increase in Current Assets
(1,08,000)
Increase in trade receivables
(32,000)
Increase in inventories
Less: Decrease in Current Liabilities
(1,00,000)
Decrease in trade payables
(1,08,000)
Decrease in short term provisions
Cash generated from Operating Activities 6,44,000/
6,12,000 2
Cash flows from Investing Activities :
(11,76,000)
Purchase of machinery
Sale of machinery 24,000
(11,52,000) 2
Cash used in investing activities
Cash flows from Financing Activities:
4,00,000
Issue of share capital
2,80,000
Money raised from long term borrowings
6,80,000 2
Cash from financing activities

1,72,000/
Net increase in cash & cash equivalents
1,40,000
Add: Opening balance of cash & cash equivalents:
4,48,000
Current Investments
16,20,000
Cash & cash equivalents

Closing Balance of cash & cash equivalents:

Current Investments 9,60,000
12,80,000 =
Cash & cash equivalents
(No marks for cash & cash equivalents) 6 Marks
Working Notes:
Machinery A/c.
Particulars R Particulars R
To Balance b/d 40,00,000 By Bank a/c 24,000
To Bank A/c (Bal. Figure) 11,76,000 By Accumulated Depreciation 64,000
By Loss on sale of machinery 8,000
By Balance c/d 50,80,000
51,76,000 51,76,000
Accumulated Depreciation A/c

Particulars R Particulars R
To Machinery A/c 64,000 By Balance b/d 6,00,000
To balance c/d 8,00,000 By Depreciation a/c (Bal fig.) 2,64,000
8,64,000 8,64,000

26
Notes:
(I) If short term provision is not treated as current liabilities by an examinee:
Decrease in short term provisions will not be shown.

1. If short term provision is treated as provision for doubtful debts.

Operating profit before working capital changes will be R 8,84,000 or
R 8,52,000.
There is no change in the cash flow from the three activities and full credit is
to be given for this treatment also.

2. If short term provision is treated as provision for tax:

Net profit before tax and extraordinary items will be R 6,00,000.
Operating profit before working capital changes will be R 11,92,000 or R
11,60,000.
Cash generated from operations before tax will be R 9,52,000 or R 9,20,000
Tax paid off R 3,08,000 will be deducted for calculating cash from operating
activities.
There is no change in the cash flow from the three activities and full credit is
to be given for this treatment also.

3. If short term provision is treated as proposed dividend:

Net profit before tax and extraordinary items will be R 6,00,000.
Cash from operating activities will be R 9,52,000 or R 9,20,000
Cash used in investing activity will remain same i.e. R (11,52,000)
Cash from financing activity will be R 3,72,000

(II) If current investment is treated as current asset by an examinee:

Increase in current investment R 5,12,000 will be deducted from operating
profit before working capital changes.
1. If Short term provision is treated as current liability:
Operating profit before working capital changes will be R 9,92,000 or R
9,60,000.
Cash from operating activities will be R 1,32,000 or 1,00,000.
Cash used in investing activity will remain same i.e. R (11,52,000) and cash
from financing activity will also remain same i.e. R 6,80,000.

2. When short term provision is treated as proposed dividend:

Net profit before tax and extraordinary items will be R 6,00,000.
Operating profit before working capital changes will be R 11,92,000 or R
11,60,000
Cash from operating activities will be R 4,40,000 or R 4,08,000
Cash used in investing activity will remain same i.e. R (11,52,000)
Cash from financing activity will be R 3,72,000

3. When short term provision is treated as provision for tax:

Net profit before tax and extraordinary items will be R 6,00,000.
Operating profit before working capital changes will be R 11,92,000 or R
11,60,000
Cash generated from operations R 9,52,000 or R 9,20,000
Tax paid off R 3,08,000 will be deducted for calculating cash from operating
activities.
Cash from operating activities will be R 6,46,000 or R 6,14,000
Cash used in investing activity will remain same i.e. R (11,52,000)
Cash from financing activity will be R 6,80,000 or R 6,48,000

4. If short term provision is treated as provision for doubtful debts:

27
 Net profit before tax and extraordinary items will be R 4,00,000.
Operating profit before working capital changes will be R 8,84,000 or R
8,52,000.
Cash from operating activities will be R 6,44,000 or R 6,12,000
Cash used in investing activity will remain same i.e. R (11,52,000)
Cash from financing activity will be R 6,80,000 or 6,48,000

PART B
(Computerised Accounting)
19 18 18 Q. ‘SQL’ stand......................questions.
Ans. 1 Mark
(iii) Structured Query Language
18 19 19 Q. The term...................of the table.
Ans. 1 Mark
(iv) Horizontal row of the table
21 20 22 Q. State the features.................software.
Ans.
Following are the features of accounting softeware:
1. Do all basic accounting functions,
2. Manage your stores,
3. Do the job costing,
4. Manage payroll, =
5. Get many MIS (Management information System) 4 Marks
6. File tax returns
7. Maintain budgets etc
8. Calculate interest pending amounts

9. Manage data over different locations and synchronize it and many more other
features

22 21 20 Q. State the steps...........................using Tally.

Ans.
The following are the steps to construct BRS in tally:
i. Bring up the monthly summary of bank book.
ii. Bring your cursor to the first month and press enter. This brings up the vouchers for
the month. Since this is a bank account, an additional button F5 : reconcile will be
visible on the right Press F5. =
iii. The display now becomes an Edit screen in Reconciliation mode. The primary 4 Marks
components are : A column for the ‘Bankers Date’.
iv. The ‘Reconciliation’ at the bottom of the screen.
v. Balance as per company’s books.
vi. Amounts not reflected in banks
vii. Balance as per bank.
20 22 21 Q. State any two.................System.
Ans.
Advantages of CAS
Following are the advantages of computerized accounting system (CAS) (Any Two)
1. Timely generation of reports and information in desired format. 2
2. Efficient record keeping.

28
 3. Ensures effective control over the system.
4. Economy in the processing of accounting data.
5. Confidentiality of data is maintained.

Limitations of CAS
Following are the limitation of CAS software: (Any Two)
1. Faster obsolescence of technology necessitates investment in shorter period of time. 2
2. Data may be lost or corrupted due to power interruptions.
3. Data are prone to hacking.
=
4. Un-programmed and un-specified reports cannot be generated.
4 marks
23 - - Q. What is.........................benifits.
Ans.
A format change, such as background cell shading or font color that is applied to a cell when
a specified condition for the data in the cell is true.
Conditional formatting is often applied to worksheets to find:
Data that is above or below a certain value.
Duplicate data values. =
6 Marks
Cells containing specific text.
Data that is above or below average.
Data that falls in the top ten or bottom ten values.
Benefits of using conditional formatting:
Helps in answering questions which are important for taking decisions.
Guides with help of using visuals.
Helps in understanding distribution and variation of critical data.

29
 Q. Set No. Marking Scheme 2014-15 Distribution
of marks
67 67 67 Accountancy (055)
/2 /2 /2 Foreign – 67/2/3
/1 /2 /3 Expected Answers / Value points
6 4 1 Q. ‘Samta Limited’ invited...........................applications was. 1 Mark

Ans. (iv) R 22,875

5 3 2 Q. Give the....................................... forfeiture of share. 1 Mark

Ans.
Forfeiture of shares means cancellation of shares and treating as forfeited the amount
actually received.
[ or any other suitable meaning ]

4 2 3 Q. Deepak, Farukh and Lilly.........................of Farukh. 1 Mark

Ans.
(b) Credited to the Capital Accounts of all partners in their profit sharing ratio.

3 1 4 Q. Anurag and Bhawana .........................partnership. 1 Mark

Ans.
Anurag’s Sacrifice = 3/10 * ½ = 3/20
1/2
Bhawana’s Sacrifice = 3/10 * ½ = 3/20
2
Anurag’s old share = 4/10 + 3/20 = 11/20
1/2
Bhawana’s old share = 3/10 + 3/20 = 9/20
2
Anurag and Bhawana’s profit sharing ratio = 11:9

2 5 5 Q. Kamal and Vimal............................correct treatment.

Ans. No, the accountant’s didn’t give correct treatment.

Reason: As credit balance in Profit and Loss Account indicates undistributed profits. It should
have been credited to Kamal and Vimal’s Capital Account.

Alternate Solution: 1 Mark

Journal
Date Particulars LF Dr (R) Cr (R)
Profit & Loss A/c Dr. 10,000
To Kamal’s Capital Account 6,000
To Vimal’s Capital A/c 4,000
(Being adjustment entry made)

1 6 6 Q. In the absence of................... is charged. 1 Mark

Ans. (iv) no interest is charged.

- - 7 Q . State any..................discount.
Ans. (Any three)
Shares can be issued at discount subject to the following conditions:
(a) The shares must belong to a class already issued. 1 Mark
(b) The issue must be authorised by a resolution passed by the company in general each
meeting and sanctioned by the central government
30
 (c) The resolution specifies the maximum rate of discount at which shares are to be
issued. =
(d) One year must have passed since the date at which the company was entitled to 3 Marks
commence business.
(e) The issue of such shares must take place within two months of the date on which the
issue was sanctioned by the central government or within such extended time as the
central government may allow.

- - 8 Q. K and L...........................error.
Ans.
Journal
Date Particulars LF Dr (R) Cr (R)
2014 L’s Capital A/c Dr. 4,228
April 1 To K’s Capital A/c 4,228 1
(Being interest on capital and salary
omitted, now adjusted)

Working Notes:
Calculation of Opening Capital :
K (R) L (R)
Closing Capitals 80,000 1,00,000
Less: Profits (54,000) (36,000)
Add: Drawings 20,000 27,000
1
Opening Capitals 46,000 91,000
Interest on Capital @ 6% p.a. 2,760 5,460

K L Total
Omission of Interest on Capital (Cr.) 2,760 5,460 8,220 1
Salary to K ( Cr.) 16,000 16,000 =
Net loss to firm (Dr.) 14,532 9,688 24,220 3 Marks
Net Effect 4,228(Cr.) 4,228(Dr.) ---
9 10 9 Q. ‘Telecom Ltd............................Companies Act, 1956.
Ans.
Balance Sheet of Telecom Ltd.
As at ....................(As per revised schedule VI)
Particulars Note No. Amount Amount
Current year Previous year
EQUITY & LIABILITIES
I Shareholder’s funds :
a) Share Capital 1 9,96,000 1
Notes to Accounts :
Particulars R
(1) Share Capital
Authorised Capital :
80,00,000 equity shares of R 10 each 8,00,00,000 1
Issued Capital
1,00,000 equity shares of R 10 each 10,00,000 ½
Subscribed and fully paid
99,000 equity shares of R 10 each 9,90,000
Subscribed but not fully paid capital
1,000 equity shares of R 10 each 10,000 ½
Less: Calls in arrears 4,000 6,000 9,96,000 =3marks

10 9 10 Q. ‘Panipat Blankets Ltd. ............................to the society.

31
 Ans. a)
Books of Panipat Blankets Ltd.
Journal
Date Particulars LF Dr (R) Cr (R)
i. Machinery A/c Dr. 12,00,000
To Vendors A/c 12,00,000 1
(Being purchase of machinery)
ii. Vendors A/c Dr. 12,00,000
To Equity Share Capital A/c 10,00,000
To 9% Debentures A/c 2,00,000 1
(Being issue of equity shares and
debentures at par )
OR
Vendors A/c Dr. 10,00,000
To Equity Share Capital A/c 10,00,000 1
(For issue of equity shares )
=
Vendors A/c Dr. 2,00,000 3 Marks
To 9% Debentures A/c 2,00,000
(For issue debentures at par )

b) Values which the company wants to communicate to the society: (Any one)
Discharging Social responsibility
Generation of employment opportunities in rural areas

(OR any other suitable value.)

- - 11 Q. Kavita, Ravita and Sunita...........executors.

Ans.

Dr. Sunita’s Capital A/c Cr.

Particulars Amount (R) Particulars Amount (R)
To Sunita’s Executor --------- By Balance b/d ------
A/c By Kavita’s Capital A/c 2,05,000 1
By Ravita’s Capital A/c 1 1,02,500
By Profit & Loss Suspense A/c 51,250 2

------------ ---------

Working notes:
i. Calculation of Share of Profit :
2,56,250 x 2/5 x 1/2 = R 51,250

ii. Share in Goodwill = 2,56,250 x 3 x 2/5= R 3,07,500 =

Kavita’s Share = R 2,05,000 4 Marks
Ravita’s share = R 1,02,500

12 12 12 Q. Jain, Gupta and Singh................................the firm.

Ans.

32
 In the books of Jain, Gupta and Singh
Profit & Loss Appropriation A/c
Dr. For the year ended 31st March 2014 Cr.
Particulars Amount (R) Particulars Amount (R)
To Interest on Capital: ½ By Profit for the year 1,47,000
Jain’s Capital A/c 29,400
Gupta’sCapitalA/c 44,100 ½ 1
Singh’s Capital A/c 73,500
1,47,000
½

1,47,000 1,47,000
=
Working notes:
4 Marks
Calculation of Interest on Capital:

(R) ½
a) Interest on Jain’s Capital: 40,000
b) Interest on Gupta’s Capital: 60,000 ½
c) Interest on Singh’s capital: 1,00,000 ½
Total: 2,00,000

The available profit is R 1,47,000 since the profit is less than interest, the available profit will
be distributed in the ratio of interest i.e. 2:3:5
14 15 13 Q. Chennai Fibers Ltd...................................2013-14.
Ans.
Dr. Cr.
9% Debentures A/c
Date Particulars LF Amount Date Particulars LF Amount
(R) (R)
2009 To Balance c/d 16,00,000 2008 By Debentures 14,40,000
Mar 31 Apr 1 app & all A/c
By Discount on 1,60,000
issse of
debentures A/c
16,00,000 1 16,00,000
2010 To Balance c/d 16,00,000 2009 By Balance b/d 16,00,000
Mar 31 Apr 1 1
2011 To Debenture 2,00,000 2010 By Balance b/d 16,00,000
Mar 31 holders A/c Apr 1
To Balance c/d 14,00,000
16,00,000 1 16,00,000
2012 To Debenture 3,00,000 2011 By Balance b/d 14,00,000
Mar 31 Holder A/c Apr 1
To Balance c/d 11,00,000
1
14,00,000 14,00,000 =
2013 To Debenture 4,00,000 2012 By Balance b/d 11,00,000
Mar 31 Holder A/c Apr 1 1 6 Marks
To Balance c/d 7,00,000
11,00,000 11,00,000
2014 To Debenture 7,00,000 2013 By Balance B/d 7,00,000
Mar 31 holders A/c Apr 1 1

7,00,000 7,00,000

15 13 14 Q. Chopra, Shah and Patel....................................amounts.

Ans.

33
 Dr. Realisation A/c Cr.
Particulars Amt (R) Particulars Amt (R)
To Plant and Machinery 1,60,000 By Sundry Creditors 1,50,000
To Stock 1,50,000 By Mrs. Chopra’s Loan 1,30,000
To Sundry Debtors 2,00,000 By Repairs and Renewals 12,000
To Prepaid Insurance 4,000 reserve
To Investments 30,000 By Provision for bad debts 10,000
To Chopra’s capital A/c 1,30,000 By cash – Assets sold:
--Mrs. Chopra’s Loan Plant 1,00,000
To Cash- dishonoured bill paid 50,000 Stock 1,20,000
To Cash- Creditors 1,50,000 Debtors 1,60,000 3,80,000
To Cash- Expenses 8,000 By Chopra’s Capital- 20,000 1
Investments

By Loss Transferred to
Partners’ Capital A/c: 1
Chopra 90,000 1,80,000
Shah 60,000
Patel 30,000
8,82,000 8,82,000

Partner’s Capital A/c

Particulars Chopra Shah Patel Particulars Chopra Shah Patel
(R) (R) (R) (R) (R) (R)
To Realisation 20,000 By Balance b/d 1,00,000 1,50,000 20,000 3
(Investments)
To Realisation A/c 90,000 60,000 30,000 By Realisation 1,30,000 ___ ___
(Loss) 1
A/c (Loan)
To Cash A/c 1 1,20,000 90,000 ___ ___ ___ 10,000 1
By Cash A/c

2,30,000 1,50,000 30,000 2,30,000 1,50,000 30,000

Dr. Cash A/c Cr.

Particulars Amount (R) Particulars Amount (R)
To balance b/d ½ 28,000 By Realisation A/c – 50,000
To Realisation A/c – Sale of ½ 3,80,000 (Dishonoured bill)
Assets By Realisation A/c 1,50,000 2
To Patel’s Capital A/c 10,000 (Creditors paid)
=
By Realisation A/c 8000 1 6 Marks
(Expenses)
By Chopra’s capital A/c 1,20,000
By Shah’s Capital A/c 90,000
4,18,000 4,18,000
13 14 15 Q. On 1-4-2013, Mohan.......................partners.
Ans.
Interest on Capital:
Mohan – 1,00,000 x 6 /100 = R 6,000 2
Sohan – 10,73,000 x 6/100 x 1/ 12 = R 5,365
Date Amount (`) Months Product
1.4.2013 50,000 1 50,000
1.5.2013 60,000 2 1,20,000
30.6.2013 55,000 3 1,65,000
30.9.2013 1,52,000 4 6,08,000 4
1.2.2014 65,000 2 1,30,000
Total: 10,73,000
34
 Note: Full credit should be given if the examinee has done the question correctly by
any other method.
Alternate solution
=
Interest on Capital of Sohan = (50,000 x 6/100 x 1/12) + (60,000 x 6/100 x 2/12) + (55,000 x 6 Marks
6/100 x 3/12) + (1,52,000 x 6/100 x 4/12) + (65,000 x 6/100 x 2/12) = R 5,365
- - 16 Q. Ratan Ltd....................... Ratan Ltd.
Ans.
Books of Vibhu Ltd.
Journal
Date Particulars L.F. Debit ( ) Credit ( )

(i) Bank A/c Dr. 15,22,500

To Equity Share Application & Allotment 15,22,500
A/c
(Being application and allotment money 1½
received with premium )
(ii) Equity Share App & Allotment A/c Dr. 15,22,500
To Equity Share Capital A/c 6,00,000
To Calls in advance A/c 3,12,000
To Securities premium/ Sec. premium Reserve A/c 6,00,000
To Bank A/c 10,500
(Being application and allotment money 1½
transferred to share capital )
(iii) Equity Share First & final call A/c Dr. 9,00,000
To Equity share Capital a/c 6,00,000
To securities premium/ Securities premium 3,00,000
Reserve A/c 1
(Being first and final call money due with
premium)
(iv) Bank A/c Dr. 5,64,000
Calls in advance A/c Dr. 3,12,000
To Equity Share First and final call A/c 8,76,000
(Being first and final call money received)
OR
Bank A/c Dr. 5,64,000 1
Calls in arrears A/c Dr. 3,12,000
Calls in advance A/c Dr. 24,000
To Equity Share First and final call A/c 9,00,000
(Being call and final call money received)
(v) Equity Share capital A/c Dr. 48,000
Securities premium A/c Dr. 12,000
To Share forfeiture A/c 36,000
To Equity share First and final call A/c / 24,000
Calls in arrear A/c 1
(Being 480 shares forfeited)

(vi) Bank A/c Dr. 27,000

Share forfeited A/c Dr. 3,000
To Equity share Capital A/c 30,000 1
(Being shares reissued)
35
 (vii) Share forfeited A/c Dr. 19,500
To Capital reserve A/c 19,500 1
(Being balance of share forfeited transferred
=
to capital reserve A/c)
8 Marks

- - 16 Q. Kalyan Ltd.................................Kalyan Ltd.

OR Ans.

Books of Kalyan Ltd.

Journal
Date Particulars LF Dr. Amt Cr. Amt
(R) (R )
i. Bank A/c Dr. 1,74,000 ½
To Equity Share Application A/c 1,74,000
(For application money received on 87,000
shares)
ii. Equity Share Application A/c Dr. 1,74,000
½
To Equity Share Capital A/c 1,74,000
(For equity share allotment made)
iii. Equity Share allotment A/c Dr. 2,61,000
Discount on issue of shares A/c Dr. 69,600 ½
To Equity Share Capital A/c 3,30,600
(For allotment money due)
iv. Bank A/c Dr. 2,56,200
To Equity share allotment a/c 2,56,200
(For allotment money received except on 1,600
shares)
OR ½
Bank A/c Dr. 2,56,200
Calls in arrears A/c Dr. 4,800
To Equity Share Allotment A/c 2,61,000
(For allotment money received except on 1,600
shares and the advance adjusted)
v. Equity Share Capital A/c Dr. 9,280
To Share forfeiture A/c 3,200 1
To Discount on issue of shares A/c 1,280
To Share allotment A/c / Calls in arrears A/c 4,800
(For 1,600 share were forfeited for non
payment of allotment money)
vi. Equity Share first and final call A/c Dr. 3,58,680 1
To Equity Share Capital A/c 3,58,680
(For first and final call money due on 85,400
shares)
vii. Bank A/c Dr. 3,52,380
To Equity share first and final call a/c 3,52,380
(For first and final call money received except
on 1,500 shares) 1
OR
Bank A/c Dr. 3,52,380

36
 Calls in arrears A/c Dr. 6,300
To Equity share first and final call A/c 3,58,680
(For first and final call money received except
on 1,500 shares)
viii. Equity Share Capital A/c Dr. 15,000
To Equity Share Forfeiture A/c 7,500 1
To Discount on issue of shares A/c 1,200
To Equity Share first and final call/ Calls in 6,300
arrears A/c
(For 1500 shares forfeited)
ix. Bank A/c Dr. 18,000
Discount on issue of shares A/c Dr. 1,600 1
Equity Share forfeiture A/c Dr. 400
To Equity Share Capital A/c 20,000
(For shares reissued 2000 shares for R9 per
share fully paid up)
x. Share forfeiture A/c Dr. 8,100
To capital reserve A/c 8,100 1
(Being forfeiture balance transferred to capital
reserve) =
8 Marks
17 17 17 Q. A,B and C.......................... retirement.
Ans.
Revaluation A/c
Dr Cr
Particulars Amt (R) Particulars Amt (R)
To machinery A/c 9,600 By Provident fund A/c ½ 500
To Patents A/c ½ 2,000 By Investment A/c 11,700
½ 2 Marks
To profit transferred to
Partner’s Capital A/c:
A 300
B 200 ½
C 100 600
12,200 12,200

Partner’s Capital A/c

Particulars A B C Particulars A B C
(R) (R) (R) (R) (R) (R)
To C’s Capital 540 360 By Balance b/d 80,000 73,000 40,000 6 Marks
A/c By A’s Capital A/c 540
To Investment 31,700 By B’s Capital A/c 360
A/c By General 10,500 7,000 3,500
12,800
To C’s loan A/c Reserve A/c
To Current 11,800 By revaluation A/c 300 200 100
A/c By current A/c 11,800
To Balance c/d 1,02,060 68,040 ---

1,02,600 80,200 44,500 1,02,600 80,200 44,500

Working Notes:
A’s capital = R 90,260
B’s capital = R 79,840
Total capital = R 1,70,100
37
 Capitals of A and B in new ratio =
A = 3/5 x 1,70,100 = 1,02,060
B = 2/5 x 1,70,100 = 68,040
=
8 Marks

17 17 17 Q. O, R and S...............................Capital accounts.

OR OR OR Ans.

Revaluation A/c
Dr Cr
Particulars Amt (R) Particulars Amt (R)
½
To liability for bills 7,004 By land and building A/c 35,000
½
discounted By plant and machinery A/c ½ 6,750
To Stock A/c ½ 27,400 By Partner’s current A/c
To furniture A/c 16,000 (loss):
To Investments A/c ½ 7,300 O 7,977
R 5,318 ½
3 Marks
S 2,659 15,954

57,704 57,704

Partner’s Current A/c

Particulars O R S Particulars O R S
(R) (R) (R) (R) (R) (R)
To balanceb/d 7,000 By Balance b/d 4,000 6,000
To revaluation By General reserve 7,500 5,000 2,500
7,977 5,318 2,659 By profit and loss 3,500 2,333 1,167
a/c
a/c
Tobalancec/d 97,023 45,015 82,008
By premium for 15,000 4 Marks
goodwill
By capital A/cs 75,000 50,000 75,000

1,05,000 57,333 84,667 1,05,000 57,333 84,667

Partners’ Capital A/c

Particulars O R S Particulars O R S
(R) (R) (R) (R) (R) (R)
To current A/cs 75,000 50,000 75,000 By Balance b/d 1,75,000 1,50,000 1,25,000
To balance c/d 1,00,000 1,00,000 50,000
1,75,000 1,50,000 1,25,000 1,75,000 1,50,000 1,25,000

H’s Capital A/c

Dr Cr
Particulars Amt (R) Particulars Amt (R)
To Balance c/d 50,000 By Bank A/c 50,000
1
=
50,000 50,000 8 Marks

PART B
(Financial Statements Analysis)
- - 18 Q. Which of the............................equity shares.
Ans.
(iii) Sale of machinery of the book value of R 38,000 at a loss of R 3,000 1 Mark

38
- - 19 Q. While.....................................reason.
Ans. 1 Mark
No, the accountant is not correct as it is finance company and dividend received is an
operating activity.
- - 20 Q. Under which.................................. three years.
Ans.

S.No. Items Headings Sub headings

1 Loans provided re-payable on Current liabilities Short term borrowings ½
demand
½
2 Goodwill Non current assets Fixed assets-
intangible
½
3 Copyright Non current assets Fixed assets-
intangible
½
4 General Reserve Shareholders’ funds Reserves and surplus
½
5 Cheques Current assets Cash and cash
equivalents ½
6 Loose Tools Current assets Inventories
½
7 Stock of finished goods Current assets Inventories
½
8 9% debentures re-payable Non current liabilities Long term borrowings
after three years =
4 Marks
21 - 21 Q. The current..........................................creditors.
Ans.
Reason

i) Decrease Current assets will decrease with no change in current

liabilities.
1x4
ii) No change Both current assets and current liabilities are not affected. =
4 Marks
iii) No change Both current assets and current liabilities are not affected.

iv) Increase Both current assets and current liabilities will decrease
with same amount.

22 22 22 Q. The motto......................................... to communicate.

Ans.
a) Net Profit Ratio

As on 31-03-2013 = Net Profit after tax / Revenue from operations x 100 1

= 8,00,000 / 40,00,000 x 100 2 Marks
½
= 20%
As on 31-03-2014 = Net Profit after tax / Revenue from operations x 100
= 16,00,000 / 60,00,000 x 100
= 26.67% ½

1 mark for formula & ½ mark for calculation of net profit ratio of each year. 1+ (½ + ½ ) = 2

39
 b) Values: (Any two)
Promoting healthy living.
Participation of Employees in excess profits. 2 Marks
Treating employees a part of the company.
Ethical practices of company =
Hardwork and honesty of employees. 4 Marks
Serving the organisation with dignity.
(Or any other suitable value)
23 23 23 Q. Following ..............................statement.
Ans.
Cash flow statement of Solar Power Ltd.
For the year ended 31st March 2014 as per AS-3 (Revised)
Particulars Details (R) Amount (R)
Cash Flows from Operating Activities:
Net Profit before tax & extraordinary items 4,00,000
Add: Non cash and non-operating charges
Goodwill written off 3,20,000/2,88,000
Depreciation on machinery 2,64,000
Loss on sale of machinery 8,000
9,92,000/9,60,000
Operating profit before working capital changes
Less: Increase in Current Assets
Increase in trade receivables (1,08,000)
(32,000)
Increase in inventories
Less: Decrease in Current Liabilities
(1,00,000)
Decrease in trade payables
(1,08,000)
Decrease in short term provisions
6,44,000/
2
Cash generated from Operating Activities
6,12,000
Cash flows from Investing Activities :
(11,76,000)
Purchase of machinery
24,000
Sale of machinery 2
(11,52,000)
Cash used in investing activities
Cash flows from Financing Activities:
4,00,000
Issue of share capital
2,80,000
Money raised from long term borrowings
6,80,000 2
Cash from financing activities

1,72,000/
Net increase in cash & cash equivalents
Add: Opening balance of cash & cash equivalents: 1,40,000
4,48,000
Current Investments
16,20,000
Cash & cash equivalents

Closing Balance of cash & cash equivalents:

9,60,000
Current Investments
Cash & cash equivalents 12,80,000
(No marks for cash & cash equivalents)

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Working Notes:
Machinery A/c.

Particulars R Particulars R
To Balance b/d 40,00,000 By Bank a/c 24,000
To Bank A/c (Bal. Figure) 11,76,000 By Accumulated Depreciation 64,000
By Loss on sale of machinery 8,000
By Balance c/d 50,80,000
51,76,000 51,76,000

Accumulated Depreciation A/c

Particulars R Particulars R
To Machinery A/c 64,000 By Balance b/d 6,00,000
To balance c/d 8,00,000 By Depreciation a/c (Bal fig.) 2,64,000
8,64,000 8,64,000

Notes:
(I) If short term provision is not treated as current liabilities by an examinee:
Decrease in short term provisions will not be shown.

1. If short term provision is treated as provision for doubtful debts.

Operating profit before working capital changes will be R 8,84,000 or
R 8,52,000.
There is no change in the cash flow from the three activities and full credit is
to be given for this treatment also.

2. If short term provision is treated as provision for tax:

Net profit before tax and extraordinary items will be R 6,00,000.
Operating profit before working capital changes will be R 11,92,000 or R
11,60,000.
Cash generated from operations before tax will be R 9,52,000 or R 9,20,000
Tax paid off R 3,08,000 will be deducted for calculating cash from operating
activities.
There is no change in the cash flow from the three activities and full credit is
to be given for this treatment also.

3. If short term provision is treated as proposed dividend:

Net profit before tax and extraordinary items will be R 6,00,000.
Cash from operating activities will be R 9,52,000 or R 9,20,000
Cash used in investing activity will remain same i.e. R (11,52,000)
Cash from financing activity will be R 3,72,000

(II) If current investment is treated as current asset by an examinee:

Increase in current investment R 5,12,000 will be deducted from operating
profit before working capital changes.
1. If Short term provision is treated as current liability:
Operating profit before working capital changes will be R 9,92,000 or R
9,60,000.
Cash from operating activities will be R 1,32,000 or 1,00,000.
Cash used in investing activity will remain same i.e. R (11,52,000) and cash
from financing activity will also remain same i.e. R 6,80,000.

2. When short term provision is treated as proposed dividend:

Net profit before tax and extraordinary items will be R 6,00,000.
Operating profit before working capital changes will be R 11,92,000 or R
41
 11,60,000
Cash from operating activities will be R 4,40,000 or R 4,08,000
Cash used in investing activity will remain same i.e. R (11,52,000)
Cash from financing activity will be R 3,72,000

3. When short term provision is treated as provision for tax:

Net profit before tax and extraordinary items will be R 6,00,000.
Operating profit before working capital changes will be R 11,92,000 or R
11,60,000
Cash generated from operations R 9,52,000 or R 9,20,000
Tax paid off R 3,08,000 will be deducted for calculating cash from operating
activities.
Cash from operating activities will be R 6,46,000 or R 6,14,000
Cash used in investing activity will remain same i.e. R (11,52,000)
Cash from financing activity will be R 6,80,000 or R 6,48,000

4. If short term provision is treated as provision for doubtful debts:

Net profit before tax and extraordinary items will be R 4,00,000.
Operating profit before working capital changes will be R 8,84,000 or R
8,52,000.
Cash from operating activities will be R 6,44,000 or R 6,12,000
Cash used in investing activity will remain same i.e. R (11,52,000)
Cash from financing activity will be R 6,80,000 or 6,48,000

PART B
(Computerised Accounting)
19 18 18 Q. ‘SQL’ stand......................questions.
Ans. 1 Mark
(iii) Structured Query Language
18 19 19 Q. The term...................of the table.
Ans. 1 Mark
(iv) Horizontal row of the table
22 21 20 Q. State the steps...........................using Tally.
Ans.
The following are the steps to construct BRS in tally:
i. Bring up the monthly summary of bank book.
ii. Bring your cursor to the first month and press enter. This brings up the vouchers for
the month. Since this is a bank account, an additional button F5 : reconcile will be
visible on the right Press F5. =
iii. The display now becomes an Edit screen in Reconciliation mode. The primary 4 Marks
components are : A column for the ‘Bankers Date’.
iv. The ‘Reconciliation’ at the bottom of the screen.
v. Balance as per company’s books.
vi. Amounts not reflected in banks
vii. Balance as per bank.
20 22 21 Q. State any two.................System.
Ans.
Advantages of CAS
Following are the advantages of computerized accounting system (CAS) (Any Two)
1. Timely generation of reports and information in desired format. 2
2. Efficient record keeping.
42
 3. Ensures effective control over the system.
4. Economy in the processing of accounting data.
5. Confidentiality of data is maintained.

Limitations of CAS
Following are the limitation of CAS software: (Any Two)
1. Faster obsolescence of technology necessitates investment in shorter period of time. 2
2. Data may be lost or corrupted due to power interruptions.
3. Data are prone to hacking.
=
4. Un-programmed and un-specified reports cannot be generated.
4 marks
21 20 22 Q. State the features.................software.
Ans.
Following are the features of accounting softeware:
1. Do all basic accounting functions,
2. Manage your stores,
3. Do the job costing,
4. Manage payroll, =
5. Get many MIS (Management information System) 4 Marks
6. File tax returns
7. Maintain budgets etc
8. Calculate interest pending amounts

9. Manage data over different locations and synchronize it and many more other
features

23 - - Q. Name and explain..........................periodic interest.

Ans.
The name of financial Functions is ACCRINT.
This function returns the accrued interest for a security that pays periodic interes. The syntax
of this is as follows:
ACCRINT ( issue, first_interest, settlement, rate, par, frequency, basis, calc_method)
Dates should be entered by using the DATE function or as results of other formulas or
functions.
Issue is the security’s issue date.
First_interest is the security’s first interest date.

43