Accounts October 2014 Board Question Paper Solution

Accounts October Board Question Paper Solution  [15]
Q1. Attempt any Three of the Following sub – questions: [5]

(A) Answer the following in ‘one’ sentence each:

(1) What is ‘balance sheet’?
Ans. A Balance Sheet is a statement showing the financial position of the business in the form of its assets and liabilities on a particular date.

(2) What is ‘deficit’?
Ans. Excess of expenditure over income shown by Income and Expenditure Account represents deficit for the financial year.

(3) What is ‘Sacrifice ratio’?
Ans. A ratio which is surrendered or given up by the old partners in favour of a newly admitted partner is called sacrifice ratio.
Formula: Sacrifice Ratio = Old Ratio – New Ratio.

(4) What is ‘allotment of shares’?
Ans. Allotment of shares means after considering the demand of the applicants, accepting application forms up to certain fixed number as per the resolution passed in the meeting of the board of directors.

(5) Who is a ‘drawer’?
The person who draws or makes the bill of exchange is called the drawer. He is the creditor. He will receive the money from debtor.


(B) Write a word / term / phrase which can substitute each of the following statements: [5]
(1) Debit balance on realisation account.
Ans. loss on realisation of Assets and Liabilities

(2) The three extra days which are allowed over and above the period of the bill.
Ans. Days of grace or Grace days.

(3) Expenses which are due but not paid at the end of the year.
Ans. Outstanding expenses.

(4) A statement similar to a balance sheet.
Ans. Statement of Affairs.

(5) An asset which can be converted into cash immediately.
Ans. Liquid asset.


(C) Select the most appropriate answer from the alternatives given below and rewrite the sentences: [5]

(1) The profit or loss from revaluation on retirement of partners is shared by _____________
(a) all the partners
(b) the remaining partners
(c) only the retiring partners
(d) none of these

(2) Purchase of stationery is a ________ expenditure.
(a) capital
(b) revenue
(c) long term
(d) deferred revenue

(3) _____________ means payment of the bill before due date.
(a) Discounting of bill
(b) Retirement of bill
(c) Renewal of bill
(d) Endorsement of bill

(4) Generally incomplete records are maintained by the __________
(a) trader
(b) company
(c) society
(d) government

(5) The interest on drawings is transferred to ___________ side of the profit and loss account.
(a) debit
(b) credit
(c) asset
(d) liability


(D) State whether the following statements are True or False: [5]

(1) The debenture holder is the owner of the company. [False]
(2) The person, to whom or as per his order amount of bill is payable, is a payee. [True]
(3) Government is not interested in the analysis of financial statement. [False]
(4) On its dissolution the cash or bank account is closed automatically. [True]
(5) A bill can’t be deposited into a bank for collection. [False]

(E) Prepare a specimen of a Bill of Exchange from the following information. [5]
Drawer: Rahul Chaudhari, 105 Ghodbunder Road, Thane.
Drawee: Prakash Patil, 207, Ganga Road, Nashik.
Payee: Sonal Chaudhari, M.G. Road, Dhule.
Period of Bill: 60 days.
Amount of bill: Rs. 10,000
Date of Bill : 15th December, 2013
Date of acceptance: 18th December, 2013.




Q2. Mrs. Asha keeps her books on Single Entry System and gives the following information: [8] [Click Here For Answer]
Particulars
31.3.2011
31.3.2012
Cash at Bank
10000
64000
Sundry debtors
50000
80000
Stock in Trade
60000
10000
Furniture
40000
40000
Machinery
100000
100000
Bills Payable
10000
10000
Sundry Creditors
30000
40000
Mrs. Asha withdrew from business Rs. 30,000 for personal use. She further introduced fresh capital of Rs. 50,000.
Depreciation is to be charged @ 10% p.a. on furniture and machinery.
Prepare:
(a) Statement of affairs as on 31.3.2011
(b) Statement of affairs as on 31.3.2012
(c) Statement of Profit or Loss for the year ending 31.3.2012.

Or

(A) What are the investing activities of cash flow? [4] [Click Here for Answer]
(B) State the limitations of analysis of financial statements. [4] [Click Here for Answer]

Q3. Anil and Sunil were partners sharing profits and losses in the ratio of 2:1 respectively. Their Balance Sheet was as follows: [10] [Click Here for Answer]
Balance Sheet as on 31st March, 2010
Liabilities
Amount
Assets
Amount
Capital A/cs

Cash at Bank
4000
Anil
24000
Debtors
15000
Sunil
16000
Stock
23500
Trade Creditors
26000
Furniture
5000
Anil’s Loan A/c
6500
Building
25,000

72,500

72,500
On 1st April, 2010, Ram is admitted in the partnership on the following terms:
(1) Ram should bring in cash of Rs. 12,000 as capital for 1/5th share in future profit.
(2) Goodwill A/c is raised in the books of the firm for Rs. 4,500.
(3) Building is revalued at Rs. 28,000 and the value of stock be reduced by Rs. 1,500.
(4) Reserve for doubtful debts be provided at 5% on debtors.
Prepare:
(a) Profit and Loss Adjustment account.
(b) Capital Accounts of partners.
(c) Balance Sheet of the new firm.

OR
Q3. Supriya, Surakha and Sujata were partners sharing profits and Losses in the ration of 2:2:1 respectively. Their Balance Sheet as on 31st March, 2012 was as follows: [Click Here for Answer]
Balance Sheet as on 31st march, 2012
Liabilities
Amount
Assets
Amount
Capital A/c

Land and Building
50000
Supriya
40000
Stock
30000
Surekha
40000
Debtors     37500

Sujata
20000
(-) R.D.D. -2500
35000
Reserve Fund
10000
Furniture
10000
Creditors
16000
Cash at Bank
5000
Outstanding Expenses
4000



130000

130000
Sujata died on 1st July, 2012 and the adjustments were agreed to as per the deed as follows:
(1) Land and Building to be valued at Rs. 60,000 and all debtors were good.
(2) Stock be depreciated by 10%.
(3) The drawing of Sujata up to the date of her death amounted to Rs. 2,000.
(4) Interest on capital was to be allowed at 10% p.a.
(5) The deceased partner’s share of goodwill is to be valued at 2years’ purchase of average profit of last 3 years.
The profits were:
2009 – 10 = Rs. 15000
2010 – 11 = Rs. 17000
2011 – 12 = Rs. 13000
(6) The deceased partner’s share of profit up to the date of her death should be based on average profit of the last two years.
You are required to prepare:
(a) Profit and Loss Adjustment Account.
(b) Sujata’s Capital Account showing the balance payable to her Executor’s Loan Account.
(c) Working notes for calculation of (a) Goodwill and (b) Profit till the date of Sujata’s death.

Q4. On 14th May, 2012 Rohit sold goods on credit to Devidas for Rs. 30,000 on the same date Rohit draws a bill on Devidas for Rs. 30,000 at 4 months. Devidas accepted it an returned to Rohit. [Click Here for Answer]
On 17th June, 2012 rohit discounted the bill with his bank @ 10% p.a.
On due date Devidas finds himself unable to make payment of the bill and requests Rphit to renew it.
Rohit accepted the proposal on the condition that Devidas should pay Rs. 10,000 on account along with interest Rs. 500 in cash and should accept a new bill for the balance at 2 months.
These arrangements were carried though.
Give Journal Entries in the Books of Rohit.
Q5. Uday and Prabhakar are partners sharing profit and losses in the proportion of 3/5 and 2/5 respectively. They dissolved their partnership firm on 31st March, 2012 when their financial position was as under. [Click Here For Solution]
Balance Sheet as on 31st March, 2012
Liabilities
Amount
Assets
Amount
Sundry creditors
15000
Cash at bank
3000
Uday’s wife’s loan
30000
Debtors   67500

Capital A/c

(-) R.D.D.  -7500
60000
Uday
138000
Stock
135000
Prabhakar
90000
Machinery
45000


Furniture
30000

273000

273000

The assets were realised as under:
Goodwill Rs. 15,000, Stock Rs. 1,20000 and Debtors Rs. 54,000.
Machinery was taken over by Prabhakar at Rs. 40000 and furniture by Uday at book value.
Uday agreed to discharge his wife’s loan.
The creditors were paid at a rebate of Rs. 3,000
The expenses of dissolution amounted to Rs. 6000
Pass necessary Journal Entries in the books of the firm.

OR

Q5. Milind and Co. Ltd. Issued 20,000 equity shares of Rs. 100 each payable as under: [10]
[Click Here for Answer]
On Application Rs. 20 per share.
On Allotment Rs. 35 per share.
On First Call Rs. 25 per share.
On Second call Rs. 20 per share.
The Company received applications for 30,000 equity shares. Applications for 20,000 shares were accepted and allotted shares. Applications for 10,000 shares were rejected and refunded in full.
The money due on allotment and both the calls was received in full.
The expenses of issue amounted to Rs. 5000.
Pass necessary journal entries in the books of the company.

Q6. From the following Balance Sheet and Receipts and Payments A/c of Vidya mandir High School, Alibag. Prepare Income and Expenditure Account for the year ended 31st March, 2008 and Balance Sheet as on that date. [Click Here For Answer]
Balance Sheet as on 1st April, 2007

Liabilities
Amount
Assets
Amount
Entrance Fees
6000
Furniture
16800
Capital Fund
103800
Laboratory
20000


Library
25000


Investment
40000


Cash in hand
1000


Cash at bank
3000


Outstanding Tuition Fees
4000

109800

109800

Receipts and Payments Account for the year ended 31st March, 2008

Receipts
Amount
Payments
Amount
To Balance b/d

By Furniture Purchased
5400
Cash in hand
1000
By Salaries
60000
Cash at bank
3000
By Rent
28000
To Tuition Fees
80000
By Sundry Expenses
15200
To Term Fees
26200
By Annual gathering expenses
11300
To Government grant
16000
By Insurance
4000
To Donation of library
30000
By closing Balance

To Interest on Investment
2000
Cash at bank
34300

158200
158200

Adjustments:
1. Tuition fees still receivable are Rs. 10,000.
2. Salaries still payable are Rs. 30,000
3. Insurance premium is paid for one year ending 30.9.2008.
4. Rent paid in advance Rs. 4000.
5. Depreciate furniture and library at 10%.
Depreciation to be charged on the closing balances of the assets.

Q7. Jitesh and Lailesh are in partnership sharing profits and losses in the ratio of 2:1. From the following Trial Balance and adjustments given below, you are required to prepare Trading and Profit and Loss A/c for the year ended 31st March, 2013 and the Balance Sheet as on that date: [15] [Click Here For Solution]

Trial Balance as on 31st March, 2013.
Particulars
Debit
Credit
Prepaid Insurance
800

Insurance
2000

R.B.D.D.

1000
Discount
800

Postage and telephone
3200

Salaries
56000

Debtors and Creditors
66000
68000
Wages
24000

Opening Stock
48000

Carriage
1000

Purchases and Sales
193200
301600
Return inwards and outwards
5600
9200
Bank overdraft

120800
Plant & Machinery
24000

Land & Building
176000

Capital


Jitesh

52000
Lailesh

48000
Total
600600
600600

Adjustments:
1. Write off Rs. 2000 for bad debts and provide R.B.D.D. 5% on debtors.
2. Goods worth Rs. 4000 were distributed as free samples.
3. Closing stock on 31.03.2013 was valued at the cost Rs. 56000 while its market price was Rs. 60,000.
4. Salaries were outstanding Rs. 2000.
5. Depreciate :
Land and Building @ 5% p.a. and

Plant & Machinery @ 10% p.a.