Board Question Paper: March 2021
Book Keeping & Accountancy
Max. Marks: 80 | Time: 3 Hrs.
(A) Select the correct options and rewrite the sentences: (5)
(1) A statement showing financial position of the business is called as _______.
(2) The set of programme that directs the computer to perform desired task is _______.
(3) The information supplied by financial statements are _______ in nature.
(4) The balance on the capital A/c of retired partner is transferred to his _______ Account.
(5) The closing balance of Receipts and Payments account usually represents _______ balance.
- A statement showing financial position of the business is called as Balance Sheet.
- The set of programme that directs the computer to perform desired task is Software.
- The information supplied by financial statements are Historical in nature.
- The balance on the capital A/c of retired partner is transferred to his Loan Account.
- The closing balance of Receipts and Payments account usually represents Cash and Bank balance.
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(B) Write a word / term / phrase which can substitute each of the following statements: (5)
- The shares on which dividend is not fixed.
- Amount which is not recoverable from Drawee on account of insolvency.
- Liability likely to arise in future on happening of some events.
- Ratio by which surviving partners are benefitted on the death of the partner.
- Account opened for revaluation of assets and liabilities.
- Equity Shares
- Bad Debts
- Contingent Liability
- Gain Ratio (or Benefit Ratio)
- Profit and Loss Adjustment Account (or Revaluation Account)
(C) Find out odd one: (5)
- Decrease in furniture, Patents written off, Increase in bills payable, R.D.D. written off.
- Subscription received, Sundry receipts, Interest received, Audit fees.
- Dock charges, Printing and stationery, Custom duty, Wages and salary.
- Electricity Bill, Trade Bill, Inland Bill, Foreign Bill.
- Creditors, Land and Building, General Reserve, Capital.
- R.D.D. written off.
- Audit fees (It is an expense, others are incomes).
- Printing and stationery (It is a Profit & Loss item / Indirect expense, others are Trading / Direct expenses).
- Electricity Bill (It is an expense, others are types of Negotiable Instruments).
- Land and Building (It is an Asset, others are Liabilities).
(D) Calculate the following: (5)
- When depreciation is ₹ 7,500 and closing balance of Library books is ₹ 92,500. Calculate the opening balance of Library books.
- A, B and C are partners sharing profits in proportion of \(\frac{1}{2}, \frac{1}{3}\) and \(\frac{1}{6}\). If A retires, what will be the new profit sharing ratio?
- 12% p.a. interest on Bank loan ₹ 80,000 for 6 months. Calculate interest.
- Insolvent partners capital A/c debit side total is ₹ 1,00,000 and credit side total is ₹ 60,000. Calculate deficiency.
- Insurance premium is paid for the year ending 30th September, 2020, amounted to ₹ 1,500. Calculate prepaid insurance assuming that the year ending is 31st March, 2020.
- ₹ 1,00,000
(Opening = Closing + Depreciation = 92,500 + 7,500) - 2 : 1
(Old Ratio A:B:C = \(\frac{3}{6} : \frac{2}{6} : \frac{1}{6}\). If A retires, B:C = 2:1) - ₹ 4,800
(\(80,000 \times \frac{12}{100} \times \frac{6}{12}\)) - ₹ 40,000
(Debit 1,00,000 - Credit 60,000) - ₹ 750
(Prepaid for April to Sept = 6 months. \(1,500 \times \frac{6}{12}\))
The Balance sheet of Prathamesh and Shiv who share profit and losses in the ratio of 3:2 as at 31st March, 2020 was as under:
| Balance Sheet as on 31st March, 2020 | |||
|---|---|---|---|
| Liabilities | Amount ₹ | Assets | Amount ₹ |
| Creditors | 49,600 | Cash at Bank | 4,000 |
| Capital: Prathamesh Shiv |
28,000 28,000 |
Building | 20,000 |
| Machinery | 28,000 | ||
| Furniture | 1,200 | ||
| Stock | 16,400 | ||
| Debtors | 36,000 | ||
| Total | 1,05,600 | Total | 1,05,600 |
They take Ajay into partnership on 1st April, 2020. The terms being:
- Ajay shall pay ₹ 4,000 as his share of Goodwill, the amount to be retained in business.
- He shall bring in ₹ 12,000 as capital for 1/4th share in the future profits.
- The firm’s assets were to be revalued as under: Building ₹ 24,000, Machinery and Furniture to be reduced by 10%, a provision of 5% on debtors is to be made for doubtful debts; stock is to be taken at a value of ₹ 20,000.
Prepare: (i) Profit and Loss Adjustment Account, (ii) Capital Account of partners and (iii) New Balance sheet.
Profit and Loss Adjustment Account
| Particulars | ₹ | Particulars | ₹ |
|---|---|---|---|
| To Machinery A/c (10%) | 2,800 | By Building A/c (Appreciation) | 4,000 |
| To Furniture A/c (10%) | 120 | By Stock A/c (Appreciation) | 3,600 |
| To R.D.D. A/c (5% of 36000) | 1,800 | ||
| To Profit on Revaluation tfr to: | |||
| Prathamesh (3/5) | 1,728 | ||
| Shiv (2/5) | 1,152 | ||
| Total | 7,600 | Total | 7,600 |
Partners' Capital Accounts
| Particulars | Prathamesh | Shiv | Ajay | Particulars | Prathamesh | Shiv | Ajay |
|---|---|---|---|---|---|---|---|
| To Balance c/d | 32,128 | 30,752 | 12,000 | By Balance b/d | 28,000 | 28,000 | - |
| By Bank A/c (Cap) | - | - | 12,000 | ||||
| By Goodwill A/c (3:2) | 2,400 | 1,600 | - | ||||
| By P&L Adj. A/c | 1,728 | 1,152 | - | ||||
| Total | 32,128 | 30,752 | 12,000 | Total | 32,128 | 30,752 | 12,000 |
Balance Sheet as on 1st April, 2020
| Liabilities | Amount ₹ | Assets | Amount ₹ |
|---|---|---|---|
| Creditors | 49,600 | Cash at Bank (4000+4000+12000) | 20,000 |
| Capital Accounts: | Building (20k+4k) | 24,000 | |
| Prathamesh | 32,128 | Machinery (28k-2.8k) | 25,200 |
| Shiv | 30,752 | Furniture (1200-120) | 1,080 |
| Ajay | 12,000 | Stock (16400+3600) | 20,000 |
| Debtors (36000-1800) | 34,200 | ||
| Total | 1,24,480 | Total | 1,24,480 |
(Retirement of Partner Problem - Solution)
Revaluation Account
| Particulars | Amount (₹) | Particulars | Amount (₹) |
|---|---|---|---|
| To Furniture A/c (15,000 - 14,000) | 1,000 | By R.D.D. A/c (Provision Reduced) (Old 2,000 - New 800) |
1,200 |
| To Machinery A/c (40,000 - 38,000) | 2,000 | By Partners' Capital A/c (Loss): | |
| To Motor Car A/c (25,000 - 23,800) | 1,200 | Geeta (1/3) | 1,000 |
| Yogita (1/3) | 1,000 | ||
| Pranita (1/3) | 1,000 | ||
| Total | 4,200 | Total | 4,200 |
Partners' Capital Accounts
| Particulars | Geeta | Yogita | Pranita | Particulars | Geeta | Yogita | Pranita |
|---|---|---|---|---|---|---|---|
| To Revaluation A/c (Loss) | 1,000 | 1,000 | 1,000 | By Balance b/d | 28,700 | 31,800 | 30,000 |
| To Geeta's Loan A/c (Balancing Fig.) |
36,700 | - | - | By General Reserve (Distributed 1:1:1) |
4,000 | 4,000 | 4,000 |
| To Balance c/d | - | 34,800 | 33,000 | By Goodwill A/c (Geeta's share raised) |
5,000 | - | - |
| Total | 37,700 | 35,800 | 34,000 | Total | 37,700 | 35,800 | 34,000 |
Balance Sheet as on 1st April, 2018
| Liabilities | Amount (₹) | Assets | Amount (₹) |
|---|---|---|---|
| Capital Accounts: | Goodwill (Geeta's Share) | 5,000 | |
| Yogita | 34,800 | Motor Car | 23,800 |
| Pranita | 33,000 | Machinery | 38,000 |
| Geeta's Loan A/c | 36,700 | Furniture | 14,000 |
| Creditors | 10,500 | Debtors (16,000) | |
| Bank Overdraft | 5,000 | Less: R.D.D. (5%) | 15,200 |
| Cash | 24,000 | ||
| Total | 1,20,000 | Total | 1,20,000 |
Working Notes:
- Calculation of Goodwill:
Firm's Goodwill = ₹ 15,000.
Geeta's Share = \( 15,000 \times \frac{1}{3} \) = ₹ 5,000.
(Only Geeta's share is raised, so it appears on the Asset side). - Calculation of R.D.D.:
Debtors = ₹ 16,000. New R.D.D. @ 5% = ₹ 800.
Old R.D.D. = ₹ 2,000.
Gain on Revaluation = \( 2,000 - 800 \) = ₹ 1,200.
Prabhakar, Sushil and Sunil were in partnership sharing profit and losses in the ratio 2:2:1. Their balance sheet as on 31st March, 2019 was as under:
| Balance Sheet as on 31st March, 2019 | |||
|---|---|---|---|
| Liabilities | Amount ₹ | Assets | Amount ₹ |
| Capital: Prabhakar | 6,000 | Bank | 500 |
| Sushil | 4,000 | Loans and Advances | 1,500 |
| Sunil | 3,000 | Debtors | 12,500 |
| Prabha’s Loan A/c | 12,000 | Goodwill | 1,500 |
| Sundry creditors | 12,000 | Plant | 2,000 |
| Bills payable | 2,000 | Land | 21,000 |
| Total | 39,000 | Total | 39,000 |
They decided to dissolve the firm as follows:
- Assets realised as; Land ₹ 18,000; Goodwill ₹ 7,500; Loans and Advances ₹ 1,200; 10% of the debts proved bad.
- Prabha’s loan was discharged along with ₹ 600 as interest.
- Creditors and Bills payable paid at 5% discount.
- Prabhakar took plant at Book value.
- Realisation expenses amounted to ₹ 2,000.
Prepare: (a) Realisation account, (b) Partners’ Capital Account and (c) Bank Account
Realisation Account
| Particulars | Amount (₹) | Particulars | Amount (₹) |
|---|---|---|---|
| To Sundry Assets (Transfer): | By Sundry Liabilities (Transfer): | ||
| - Loans & Advances | 1,500 | - Prabha's Loan A/c | 12,000 |
| - Debtors | 12,500 | - Sundry Creditors | 12,000 |
| - Goodwill | 1,500 | - Bills Payable | 2,000 |
| - Plant | 2,000 | ||
| - Land | 21,000 | ||
| To Bank A/c (Prabha's Loan Paid): | By Bank A/c (Assets Realised): | ||
| (12,000 + 600 Interest) | 12,600 | - Land | 18,000 |
| To Bank A/c (Liabilities Paid): | - Goodwill | 7,500 | |
| - Creditors (12,000 - 5%) | 11,400 | - Loans & Advances | 1,200 |
| - Bills Payable (2,000 - 5%) | 1,900 | - Debtors (12,500 - 10%) | 11,250 |
| To Bank A/c (Realisation Exp.) | 2,000 | By Prabhakar's Capital A/c | |
| (Plant taken over) | 2,000 | ||
| By Loss on Realisation tfr to: | |||
| - Prabhakar (2/5) | 180 | ||
| - Sushil (2/5) | 180 | ||
| - Sunil (1/5) | 90 | ||
| Total | 66,400 | Total | 66,400 |
Partners' Capital Accounts
| Particulars | Prabhakar | Sushil | Sunil | Particulars | Prabhakar | Sushil | Sunil |
|---|---|---|---|---|---|---|---|
| To Realisation A/c (Plant taken) |
2,000 | - | - | By Balance b/d | 6,000 | 4,000 | 3,000 |
| To Realisation A/c (Loss) |
180 | 180 | 90 | ||||
| To Bank A/c (Final Payment) |
3,820 | 3,820 | 2,910 | ||||
| Total | 6,000 | 4,000 | 3,000 | Total | 6,000 | 4,000 | 3,000 |
Bank Account
| Receipts | Amount (₹) | Payments | Amount (₹) |
|---|---|---|---|
| To Balance b/d | 500 | By Realisation A/c (Prabha's Loan) | 12,600 |
| To Realisation A/c (Assets) | 37,950 | By Realisation A/c (Liabilities) | 13,300 |
| By Realisation A/c (Expenses) | 2,000 | ||
| By Prabhakar's Capital A/c | 3,820 | ||
| By Sushil's Capital A/c | 3,820 | ||
| By Sunil's Capital A/c | 2,910 | ||
| Total | 38,450 | Total | 38,450 |
Working Notes:
- Debtors Realised: 12,500 - 10% (1,250) = 11,250.
- Creditors Paid: 12,000 - 5% (600) = 11,400.
- Bills Payable Paid: 2,000 - 5% (100) = 1,900.
- Realisation Loss: Total Debit (66,400) - Total Credit (65,950) = 450. Distributed 2:2:1 (180:180:90).
Mohini sold goods to Rohini worth ₹ 2,400 and accepted the bill drawn by Mohini for 2 months. Mohini discounted the bill with Bank of Maharashtra after one month at 15% p.a. The bill was dishonoured on the due date and Rohini requested Mohini to accept ₹ 400 along with interest ₹ 55 in cash. Mohini agreed and for the balance Rohini accepted a new bill of 3 months. But Rohini become insolvent and only 25% could be recovered from her estate.
| Date | Particulars | L.F. | Debit (₹) | Credit (₹) |
|---|---|---|---|---|
| 1. | Rohini A/c ... Dr. (Being goods sold on credit) |
2,400 | ||
| To Sales A/c | 2,400 | |||
| 2. | Bills Receivable A/c ... Dr. (Being bill drawn and accepted for 2 months) |
2,400 | ||
| To Rohini A/c | 2,400 | |||
| 3. | Bank A/c ... Dr. Discount A/c ... Dr. (Note 1) (Being bill discounted with bank @ 15% p.a.) |
2,370 30 |
||
| To Bills Receivable A/c | 2,400 | |||
| 4. | Rohini A/c ... Dr. (Being discounted bill dishonoured on due date) |
2,400 | ||
| To Bank A/c | 2,400 | |||
| 5. | Rohini A/c ... Dr. (Being interest due on balance amount) |
55 | ||
| To Interest A/c | 55 | |||
| 6. | Cash A/c ... Dr. (400 + 55) (Being part payment received with interest) |
455 | ||
| To Rohini A/c | 455 | |||
| 7. | Bills Receivable A/c ... Dr. (Being new bill accepted for balance for 3 months) |
2,000 | ||
| To Rohini A/c (2400 + 55 - 455) | 2,000 | |||
| 8. | Rohini A/c ... Dr. (Being bill cancelled due to insolvency) |
2,000 | ||
| To Bills Receivable A/c | 2,000 | |||
| 9. | Bank A/c ... Dr. (25% of 2000) Bad Debts A/c ... Dr. (75% of 2000) (Being final dividend received and balance written off) |
500 1,500 |
||
| To Rohini A/c | 2,000 |
Note 1 (Discount Calculation): The bill is for 2 months but discounted after 1 month. Unexpired period = 1 month.
Discount = \( 2,400 \times \frac{15}{100} \times \frac{1}{12} \) = ₹ 30.
Niharika Ltd. issued 10,000 equity shares of ₹ 10 each at a premium of ₹ 2 per share payable as follows:
- On application ₹ 3 per share
- On allotment ₹ 5 per share (including premium)
- On first and final call ₹ 4 per share
Applications were received for 12,000 equity shares and pro-rata allotment was made to all the applicants. The excess application money was adjusted with allotment.
Deepali who was allotted 20 shares failed to pay at first and final call and her shares were forfeited.
Pass Journal Entries in the books of Niharika Ltd.
| Date | Particulars | L.F. | Debit (₹) | Credit (₹) |
|---|---|---|---|---|
| 1. | Bank A/c ... Dr. (Being application money received on 12,000 shares @ ₹3) |
36,000 | ||
| To Share Application A/c | 36,000 | |||
| 2. | Share Application A/c ... Dr. | 36,000 | ||
| To Share Capital A/c (10,000 x 3) | 30,000 | |||
| To Share Allotment A/c (Excess adjusted) | 6,000 | |||
| (Being app money transferred and excess adjusted) | ||||
| 3. | Share Allotment A/c ... Dr. | 50,000 | ||
| To Share Capital A/c (10,000 x 3) | 30,000 | |||
| To Share Premium A/c (10,000 x 2) | 20,000 | |||
| (Being allotment money due with premium) | ||||
| 4. | Bank A/c ... Dr. (50,000 - 6,000) | 44,000 | ||
| To Share Allotment A/c | 44,000 | |||
| 5. | Share First & Final Call A/c ... Dr. (10,000 x 4) | 40,000 | ||
| To Share Capital A/c | 40,000 | |||
| 6. | Bank A/c ... Dr. | 39,920 | ||
| Calls in Arrears A/c ... Dr. (20 x 4) | 80 | |||
| To Share First & Final Call A/c | 40,000 | |||
| 7. | Share Capital A/c ... Dr. (20 x 10) | 200 | ||
| To Calls in Arrears A/c | 80 | |||
| To Share Forfeiture A/c | 120 | |||
| (Being 20 shares forfeited for non-payment of call) |
Explain the importance of computerized accounting system.
The importance of a Computerized Accounting System (CAS) includes:
- Speed: It performs accounting functions much faster than manual methods.
- Accuracy: Computerized systems minimize arithmetic errors and ensure high precision in reports.
- Automation: Once data is entered, the system automatically calculates ledgers, trial balances, and financial statements.
- Storage: It allows for the storage of vast amounts of data in a small physical space compared to bulky manual ledgers.
- Security: Data can be secured via passwords and encryption, and backups are easier to maintain.
Sachin, Deepak and Gopal were partners sharing profits and losses in the ratio 3:2:1 respectively. Their balance sheet as on 31st March, 2020 is as under:
| Liabilities | Amount ₹ | Assets | Amount ₹ |
|---|---|---|---|
| Capital: Sachin | 15,000 | Bank | 7,000 |
| Deepak | 10,000 | Investment | 9,000 |
| Gopal | 5,000 | Debtors | 8,000 |
| Creditors | 4,000 | Less: R.D.D. | (1,000) |
| Bank Loan | 10,000 | (Outer) | 7,000 |
| Bills payable | 9,000 | Motor Car | 10,000 |
| Machinery | 20,000 | ||
| Total | 53,000 | Total | 53,000 |
Gopal died on 30th June, 2020. Adjustments:
- Gopal’s share of goodwill is to be calculated at 2 years purchase of average profit of last 5 years.
- Gopal’s share of profit up to his death to be calculated on the basis of average profit of last 2 years.
- Five years’ profits were – I year ₹ 3,000, II year ₹ 5,500, III year ₹ 3,500, IV year ₹ 6,000, V year ₹ 12,000 respectively.
- All debtors were good.
- Assets were revalued as: Machinery ₹ 22,000, Motor Car ₹ 9,000, Investment ₹ 8,500.
Prepare: (1) Profit and Loss Adjustment Account, (2) Gopal’s Capital Account, (3) Calculate Gopal’s share of goodwill, (4) Calculate Gopal’s share on profit.
Working Notes:
1. Goodwill: Avg Profit = (3000+5500+3500+6000+12000)/5 = 30,000/5 = ₹ 6,000.
Goodwill = 6,000 x 2 = ₹ 12,000.
Gopal's Share (1/6) = 12,000 x 1/6 = ₹ 2,000.
2. Profit Suspense: Avg Profit of last 2 years = (6,000 + 12,000)/2 = 9,000.
Period (April to 30 June) = 3 months.
Profit for 3 months = 9,000 x 3/12 = 2,250.
Gopal's Share = 2,250 x 1/6 = ₹ 375.
Profit and Loss Adjustment Account
| Particulars | ₹ | Particulars | ₹ |
|---|---|---|---|
| To Motor Car (Dec) | 1,000 | By Machinery (Inc) | 2,000 |
| To Investment (Dec) | 500 | By R.D.D. (Written back) | 1,000 |
| To Profit tfr to Cap: | |||
| Sachin (750), Deepak (500), Gopal (250) | 1,500 | ||
| Total | 3,000 | Total | 3,000 |
Gopal's Capital Account
| Particulars | ₹ | Particulars | ₹ |
|---|---|---|---|
| To Balance c/d (Executor) | 7,625 | By Balance b/d | 5,000 |
| By Goodwill A/c | 2,000 | ||
| By P&L Suspense A/c | 375 | ||
| By P&L Adj A/c (Profit) | 250 | ||
| Total | 7,625 | Total | 7,625 |
Following is the Balance sheet and Receipts and payments A/c of Pol Hospital, Parbhani:
Balance Sheet as on 1st April, 2019
| Liabilities | Amount ₹ | Assets | Amount ₹ |
|---|---|---|---|
| Capital fund | 89,850 | Outstanding Subscription | 400 |
| Outstanding salary | 1,500 | Equipments | 14,000 |
| Medicines bill unpaid | 900 | Furniture | 5,000 |
| Outstanding Sundry Exp | 150 | Building | 70,000 |
| Cash in hand/bank | 3,000 | ||
| Total | 92,400 | Total | 92,400 |
Receipts and Payments Account for year ended 31st March, 2020
| Receipts | ₹ | Payments | ₹ |
|---|---|---|---|
| To Balance b/d | 3,000 | By Medicines (incl prev yr) | 5,000 |
| To Subscription (incl 400 old) | 9,000 | By Salaries (incl prev yr) | 5,200 |
| To Sale of furniture (BV 2000) | 1,500 | By Taxes | 720 |
| To Donations (Capitalized) | 5,000 | By Sundry Exp (2018-19) | 150 |
| To Life memb. fees | 3,000 | By Insurance | 5,000 |
| To Visit Fees | 3,500 | By Stationery | 2,000 |
| To Mis. Receipts | 1,500 | By Electricity bill | 6,000 |
| To Sale of old Newspaper | 500 | By Balance c/d | 2,930 |
Adjustments: (1) 50% Life membership fees capitalized. (2) Outstanding sub ₹ 2,000. (3) Depreciate Bldg 10%, Equip ₹ 1,200. (4) O/S salary ₹ 800. (5) Prepaid taxes ₹ 100.
Prepare: Income and Expenditure Account.
Income and Expenditure Account
For the year ended 31st March, 2020
| Expenditure | Amount (₹) | Amount (₹) | Income | Amount (₹) | Amount (₹) |
|---|---|---|---|---|---|
| To Salaries | 5,200 | By Subscriptions | 9,000 | ||
| Less: Outstanding of L.Y. | (1,500) | Less: Outstanding of L.Y. | (400) | ||
| 3,700 | 8,600 | ||||
| Add: Outstanding (Current) | 800 | 4,500 | Add: Outstanding (Current) | 2,000 | 10,600 |
| To Medicines | 5,000 | By Life membership fees (50%) | 1,500 | ||
| Less: Outstanding of L.Y. | (900) | 4,100 | By Visit fees | 3,500 | |
| To Taxes | 720 | By Misc. Receipts | 1,500 | ||
| Less: Prepaid | (100) | 620 | By Sale of old newspaper | 500 | |
| To Insurance | 5,000 | By Deficit | 13,320 | ||
| To Stationery | 2,000 | (Excess of expenditure over income) | |||
| To Electricity bill | 6,000 | ||||
| To Loss on sale of Furniture | 500 | ||||
| To Depreciation on: | |||||
| - Building | 7,000 | ||||
| - Equipment | 1,200 | 8,200 | |||
| Total | 30,920 | Total | 30,920 |
Balance Sheet
As on 31st March, 2020
| Liabilities | Amount (₹) | Amount (₹) | Assets | Amount (₹) | Amount (₹) |
|---|---|---|---|---|---|
| Capital Fund | 89,850 | Equipment | 14,000 | ||
| Add: Donations | 5,000 | Less: Depreciation | (1,200) | 12,800 | |
| Add: Life membership fees (50%) | 1,500 | Furniture | 5,000 | ||
| 96,350 | Less: Sale (Book Value) | (2,000) | 3,000 | ||
| Less: Deficit | (13,320) | 83,030 | Building | 70,000 | |
| Less: Depreciation (10%) | (7,000) | 63,000 | |||
| Outstanding Salary | 800 | Cash in Hand | 830 | ||
| Cash at Bank | 2,100 | ||||
| Outstanding subscription | 2,000 | ||||
| Prepaid Taxes | 100 | ||||
| Total | 83,830 | Total | 83,830 |
M/s Wardha Traders is a partnership firm (Ramesh & Suresh equal partners). Trial Balance as on 31st March, 2017:
| Debit Balance | ₹ | Credit Balance | ₹ |
|---|---|---|---|
| Stock (1st April 2016) | 32,500 | Sundry creditors | 45,325 |
| Purchases | 44,500 | Sales | 61,000 |
| Sundry Debtors | 1,00,000 | Capital: Ramesh | 1,20,000 |
| Investment | 40,500 | Capital: Suresh | 40,000 |
| Insurance | 10,200 | ||
| Plant and machinery | 15,000 | ||
| Salaries | 4,850 | ||
| Bad debts | 500 | ||
| Furniture | 12,500 | ||
| Cash in hand | 5,775 | ||
| Total | 2,66,325 | Total | 2,66,325 |
Adjustments:
- Clothing stock is valued at ₹ 28,000.
- Goods of ₹ 3,000 distributed as a free sample.
- Provide further Bad debts of ₹ 800.
- Depreciate furniture at 5% p.a.
- Insurance ₹ 1,875 is prepaid.
Trading and Profit & Loss A/c for year ended 31st March, 2017
| Particulars | ₹ | Particulars | ₹ |
|---|---|---|---|
| To Opening Stock | 32,500 | By Sales | 61,000 |
| To Purchases | 44,500 | By Goods dist. as free sample | 3,000 |
| To Gross Profit c/d | 15,000 | By Closing Stock | 28,000 |
| Total | 92,000 | Total | 92,000 |
| To Salaries | 4,850 | By Gross Profit b/d | 15,000 |
| To Bad Debts (500 + New 800) | 1,300 | By Net Loss tfr to Capital: | |
| To Advertisement (Free Sample) | 3,000 | Ramesh (1/2) | 1,550 |
| To Depr on Furniture (5% of 12500) | 625 | Suresh (1/2) | 1,550 |
| To Insurance (10200 - 1875) | 8,325 | ||
| Total | 18,100 | Total | 18,100 |
Balance Sheet as on 31st March, 2017
| Liabilities | Amount ₹ | Assets | Amount ₹ |
|---|---|---|---|
| Capital Accounts: | Plant & Machinery | 15,000 | |
| Ramesh (1,20,000 - 1,550) | 1,18,450 | Furniture (12,500 - 625) | 11,875 |
| Suresh (40,000 - 1,550) | 38,450 | Investment | 40,500 |
| Sundry Creditors | 45,325 | Debtors (1,00,000 - 800) | 99,200 |
| Closing Stock | 28,000 | ||
| Prepaid Insurance | 1,875 | ||
| Cash in Hand | 5,775 | ||
| Total | 2,02,225 | Total | 2,02,225 |
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