Board Question Paper: July 2025 - Book Keeping & Accountancy - Solutions

Board Question Paper: July 2025 - Book Keeping & Accountancy

Q.1. Objective Questions

(A) Select the most appropriate alternatives from the following and rewrite the sentences:

  1. In tally, Fixed Deposit Account comes under (a) Investments group.
  2. Before acceptance the bill is called a/an (c) draft.
  3. If asset is taken over by the partner, (b) capital account is debited.
  4. Donation for building fund is (c) capital receipt.
  5. The Indian Partnership Act is enforced since (a) 1932.

(B) Write a word / term / phrase which can substitute each of the following sentences:

  1. Issue of shares at its face value.
    Ans: Issue at Par
  2. Money value of business reputation earned by the firm over a number of years.
    Ans: Goodwill
  3. Capital employed × \(\frac{NRR}{100}\) = _________.
    Ans: Normal Profit
  4. The receipts which are recurring in nature.
    Ans: Revenue Receipts
  5. Under this method, capital balances of partners remain constant.
    Ans: Fixed Capital Method

(C) Answer in one sentence only:

  1. To which account profit is to be transferred upto the date of death of a partner?
    Ans: Usually transferred to Profit and Loss Suspense Account.
  2. How many days of grace are allowed to honour a bill?
    Ans: Three days of grace are allowed.
  3. Who should bear the capital deficiency of insolvent partner?
    Ans: Solvent partners (having credit balance) should bear the deficiency in their profit sharing ratio.
  4. What is Entrance Fees?
    Ans: Entrance fees are the fees paid by a person who intends to become a member of a Not for Profit concern.
  5. What do you mean by pre-received income?
    Ans: Income which is received during the current year but relates to the next accounting year is called pre-received income.

(D) Do you agree or disagree with the following statements:

  1. On dissolution, cash/bank account is closed automatically.
    Ans: Agree
  2. Financial statement includes only Balance Sheet.
    Ans: Disagree
  3. On retirement of a partner, sacrifice ratio is considered.
    Ans: Disagree
  4. Receipts and Payments Account is a Real Account.
    Ans: Agree
  5. Current Account always shows debit balance.
    Ans: Disagree

Q.2. Admission of Partner (Nishant, Yogesh and Niharika)

Working Notes:
1. Calculation of Goodwill:
Average Profit = (30,000 + 22,500 + 37,500 + 15,000 + 22,500) / 5 = 1,27,500 / 5 = ₹ 25,500.
Goodwill = Average Profit × 4 = 25,500 × 4 = ₹ 1,02,000.
Niharika's Share (1/5) = 1,02,000 × 1/5 = ₹ 20,400.
2. Cash Balance:
Opening Cash: 37,500 + Capital (60,000) + Goodwill (20,400) = ₹ 1,17,900.

In the books of Partnership Firm

Profit and Loss Adjustment Account (Revaluation A/c)

Particulars Amount (₹) Particulars Amount (₹)
To Furniture A/c (Depreciation) 7,500 By Bills Receivable A/c (Increase) 15,000
To Stock A/c (Depreciation) 15,000 By Partners' Capital A/c (Loss):
To R.D.D. A/c (Increase 15k-7.5k) 7,500   Nishant (3/4) 16,875
To Bills Payable A/c (Omitted) 7,500   Yogesh (1/4) 5,625
Total 37,500 Total 37,500

Partners' Capital Accounts

Particulars Nishant Yogesh Niharika Particulars Nishant Yogesh Niharika
To P&L Adj. (Loss) 16,875 5,625 - By Balance b/d 75,000 81,000 -
To Balance c/d 91,425 86,475 60,000 By Reserve Fund 18,000 6,000 -
By Cash A/c (Goodwill) 15,300 5,100 -
By Cash A/c (Capital) - - 60,000
Total 1,08,300 92,100 60,000 Total 1,08,300 92,100 60,000

Balance Sheet of New Firm as on 1st April, 2022

Liabilities Amount (₹) Amount (₹) Assets Amount (₹) Amount (₹)
Capital Accounts: Cash in Hand 1,17,900
Nishant 91,425 Bills Receivable 60,000
Yogesh 86,475 Debtors 75,000
Niharika 60,000 2,37,900 Less: R.D.D. 15,000 60,000
Creditors 45,000 Stock (45k - 15k) 30,000
Bills Payable (Omitted) 7,500 Furniture (30k - 7.5k) 22,500
Total 2,90,400 Total 2,90,400

OR

Q.2. Retirement of Partner (Journal Entries)

Journal Entries in the books of the Firm

Date Particulars L.F. Debit (₹) Credit (₹)
2020
Apr 1		 Goodwill A/c ... Dr. 50,000
  To Riddhi's Capital A/c 30,000
  To Siddhi's Capital A/c 10,000
  To Kirti's Capital A/c 10,000
(Being Goodwill raised in the books)
Apr 1 Profit and Loss Adjustment A/c ... Dr. 18,000
  To Debtors A/c (65k-57k) 8,000
  To Motor Truck A/c (110k-100k) 10,000
(Being decrease in value of assets recorded)
Apr 1 Live Stock A/c ... Dr. (65k-55k) 10,000
Building A/c ... Dr. (82k-80k) 2,000
Plant and Machinery A/c ... Dr. (41k-40k) 1,000
  To Profit and Loss Adjustment A/c 13,000
(Being increase in value of assets recorded)
Apr 1 Riddhi's Capital A/c ... Dr. 3,000
Siddhi's Capital A/c ... Dr. 1,000
Kirti's Capital A/c ... Dr. 1,000
  To Profit and Loss Adjustment A/c 5,000
(Being Revaluation Loss distributed)
Apr 1 Bank A/c ... Dr. 85,000
  To Riddhi's Capital A/c 55,000
  To Siddhi's Capital A/c 30,000
(Being additional capital contributed)
Apr 1 Kirti's Capital A/c ... Dr. 75,000
  To Kirti's Loan A/c 75,000
(Being Kirti's balance transferred to her loan account)
Calculation: 55,000 (Op) + 11,000 (Gen Res) + 10,000 (GW) - 1,000 (Loss) = 75,000

Q.3. Dissolution of Partnership Firm (All Partners Insolvent)

Analysis: Since all partners are insolvent, external liabilities (Creditors) are not transferred to Realisation Account. Available cash is distributed to creditors, and the unpaid balance is transferred to Deficiency Account.

Realisation Account

Particulars Amount (₹) Particulars Amount (₹)
To Sundry Assets A/c: By Bank A/c (Assets Realised):
  Building 1,56,000   Building 80,000
  Furniture 90,000   Furniture 60,000
  Goodwill 70,000   Debtors 20,000
  Debtors 40,000 By Partners' Capital A/c (Loss):
To Bank A/c (Expenses) 4,000   Virat (2/5) 80,000
  Rohit (2/5) 80,000
  Hardik (1/5) 40,000
Total 3,60,000 Total 3,60,000

Partners' Capital Accounts

Particulars Virat Rohit Hardik Particulars Virat Rohit Hardik
To Realisation A/c (Loss) 80,000 80,000 40,000 By Balance b/d 52,000 44,000 36,000
By Bank A/c (Recovered) 4,000 4,000 -
By Deficiency A/c 24,000 32,000 4,000
Total 80,000 80,000 40,000 Total 80,000 80,000 40,000

Bank Account

Particulars Amount (₹) Particulars Amount (₹)
To Balance b/d 16,000 By Realisation A/c (Exp) 4,000
To Realisation A/c (Assets) 1,60,000 By Creditors A/c (Bal. fig) 1,80,000
To Virat's Capital A/c 4,000
To Rohit's Capital A/c 4,000
Total 1,84,000 Total 1,84,000

Creditors Account

Particulars Amount (₹) Particulars Amount (₹)
To Bank A/c (Paid) 1,80,000 By Balance b/d 2,40,000
To Deficiency A/c (Unpaid) 60,000
Total 2,40,000 Total 2,40,000

Deficiency Account

Particulars Amount (₹) Particulars Amount (₹)
To Virat's Capital A/c 24,000 By Creditors A/c 60,000
To Rohit's Capital A/c 32,000
To Hardik's Capital A/c 4,000
Total 60,000 Total 60,000

OR

Q.3. Bills of Exchange

In the books of Disha

Priya's Account

Date Particulars Amount (₹) Date Particulars Amount (₹)
2022
Apr 1		 To Sales A/c 50,000 2022
Apr 1		 By Bills Receivable A/c 50,000
Jun 30 To Bills Receivable A/c
(Bill Cancelled)		 50,000 Jun 30 By Cash A/c 20,000
Jun 30 To Interest A/c 600 Jun 30 By Bills Receivable A/c
(New Bill)		 30,600
Total 1,00,600 Total 1,00,600

Q.4. Death of Partner (Leena)

Working Notes:
1. Revaluation Profit:
Profit on Land & Building (30,100 - 16,000) = +14,100
Loss on Stock (17,000 - 16,700) = -300
Loss on Furniture (18,000 - 16,200) = -1,800
Net Profit = 14,100 - 2,100 = 12,000.
Leena's Share (1/4) = ₹ 3,000.

2. Goodwill:
Average Profit = (30k+25k+25k+40k)/4 = 120k/4 = 30,000.
Goodwill of Firm = 30,000 × 3 = 90,000.
Leena's Share = 90,000 × 1/4 = ₹ 22,500.

3. Profit Suspense (Apr 1 to Jun 30 = 3 months):
Based on last year's profit (40,000).
Leena's Profit = 40,000 × 3/12 × 1/4 = ₹ 2,500.

4. Interest on Capital:
Leena's Capital = 12,000.
Interest = 12,000 × 10% × 3/12 = ₹ 300.

Leena's Capital Account

Particulars Amount (₹) Particulars Amount (₹)
To Drawings A/c 2,700 By Balance b/d 12,000
To Leena's Executor's Loan A/c
(Balancing Figure)		 41,600 By General Reserve A/c (16k × 1/4) 4,000
By P&L Adjustment A/c (Profit) 3,000
By Goodwill A/c (Share) 22,500
By P&L Suspense A/c 2,500
By Interest on Capital A/c 300
Total 44,300 Total 44,300

(b) Leena's share of goodwill: ₹ 22,500.

Q.5. Issue of Shares (Saraswati and Sons Ltd.)

Journal Entries in the books of Saraswati and Sons Ltd.

Date Particulars L.F. Debit (₹) Credit (₹)
1. Bank A/c ... Dr. 1,50,000
  To Equity Share Application A/c 1,50,000
(Being application money on 50,000 shares @ ₹3 received)
2. Equity Share Application A/c ... Dr. 1,50,000
  To Equity Share Capital A/c 1,50,000
(Being application money transferred to share capital)
3. Equity Share Allotment A/c ... Dr. 1,50,000
  To Equity Share Capital A/c 1,50,000
(Being allotment money on 50,000 shares @ ₹3 due)
4. Bank A/c ... Dr. 1,50,000
  To Equity Share Allotment A/c 1,50,000
(Being allotment money received)
5. Equity Share First & Final Call A/c ... Dr. 2,00,000
  To Equity Share Capital A/c 2,00,000
(Being call money on 50,000 shares @ ₹4 due)
6. Bank A/c ... Dr. (45,000 × 4) 1,80,000
Calls in Arrears A/c ... Dr. (5,000 × 4) 20,000
  To Equity Share First & Final Call A/c 2,00,000
(Being call money received except on 5,000 shares)
7. Equity Share Capital A/c ... Dr. (5,000 × 10) 50,000
  To Calls in Arrears A/c (5,000 × 4) 20,000
  To Share Forfeiture A/c (5,000 × 6) 30,000
(Being 5,000 shares forfeited for non-payment of call)

OR

Q.5. Common Size Statement (Olam Ltd.)

Common Size Balance Sheet as on 31st March, 2021

Particulars Amount (₹) %
I. Equity and Liabilities
Equity Share Capital 4,50,000 50.56
Preference Share Capital 40,000 4.49
Reserves and Surplus 75,000 8.43
Secured Loans 1,50,000 16.85
Unsecured Loans 1,00,000 11.24
Current Liabilities 75,000 8.43
Total 8,90,000 100.00
II. Assets
Fixed Assets 4,50,000 50.56
Investments 75,000 8.43
Current Assets 3,65,000 41.01
Total 8,90,000 100.00

Q.6. Not for Profit Concern (Gajanan Charitable Hospital)

Income and Expenditure Account for the year ended 31st March, 2021

Expenditure Amount (₹) Amount (₹) Income Amount (₹) Amount (₹)
To Drugs Consumed: By Subscriptions 1,11,000
  Op. Stock 21,000 By Hospital Receipts 2,55,200
  Add: Purchases 80,000 (By Deficit) 24,550
  (100k - 20k old)
  Less: Cl. Stock (11,000) 90,000
To Staff Salary 42,500
To Honorarium to Doctors 2,00,000
To Repairs 9,000
To General Expenses 8,000
To Depreciation on:
  Building (5%) 26,250
  Ambulance 15,000 41,250
Total 3,90,750 Total 3,90,750

Balance Sheet as on 31st March, 2021

Liabilities Amount (₹) Amount (₹) Assets Amount (₹) Amount (₹)
Capital Fund 5,50,000 Building 5,25,000
Add: Life Mem. Fees 15,000 Less: Depreciation 26,250 4,98,750
Less: Deficit (24,550) 5,40,450 Ambulance 2,00,000
Bank Loan 3,25,000 Less: Depreciation 15,000 1,85,000
Outstanding Bill for drugs 5,000 Hospital Equipment 1,52,000
(25k Old - 20k Paid) Furniture 22,500
Stock of drugs 11,000
Cash in hand 1,200
Total 8,70,450 Total 8,70,450

Q.7. Final Accounts (Ram and Shyam)

Working Notes:
1. Insurance: Paid 30,000 for 15 months. Prepaid for 3 months = 30,000 × 3/15 = 6,000. Expense = 24,000.
2. Depreciation on Building:
Opening 60,000 (10% for 12 months) = 6,000.
Addition 40,000 (10% for 9 months from 1st July) = 3,000.
Total = 9,000.
3. Interest on Loan: 60,000 × 10% × 6/12 = 3,000. (Entirely outstanding as no debit in TB).

Profit and Loss Account for the year ended 31st March, 2022

Particulars Amount (₹) Particulars Amount (₹)
To Insurance (30k - 6k) 24,000 By Gross Profit b/d 69,000
To Salaries 10,000 By Interest (Received) 3,000
To Export Duty 5,000
To Rent 2,000
To Depreciation on:
  Land & Building 9,000
  Furniture (5% of 80k) 4,000
To Bad Debts (New) 2,000
To R.D.D. (New 5% on 50k) 2,500
To Interest on Bank Loan (O/S) 3,000
To Net Profit (Trf to Capital):
  Ram (1/2) 5,250
  Shyam (1/2) 5,250
Total 72,000 Total 72,000

Balance Sheet as on 31st March, 2022

Liabilities Amount (₹) Amount (₹) Assets Amount (₹) Amount (₹)
Capital Accounts: Land and Building 1,00,000
Ram (100k + 5.25k) 1,05,250 Less: Depreciation 9,000 91,000
Shyam (100k + 5.25k) 1,05,250 2,10,500 Furniture 80,000
10% Bank Loan 60,000 Less: Depreciation 4,000 76,000
Add: O/S Interest 3,000 63,000 Debtors 52,000
Bills Payable 16,000 Less: Bad Debts 2,000
Less: R.D.D. 2,500 47,500
Closing Stock 69,000
Prepaid Insurance 6,000
Total 2,89,500 Total 2,89,500
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