|Time allowed : 3 hours||Maximum marks : 100|
|Total number of questions : 8||Total number of printed pages : 8|
|Note: Answer SIX questions including Question No. 1 which is compulsory. All working notes should be shown distinctly.|
|1.||(a)||Explain any two of the following:|
|(ii)||Petty cash book||(0)|
|(iii)||Cash system of accounting.||(0)|
(5 marks each)
|(b)||State, with reasons in brief, whether the following statements are true or false:|
|(i)||A bank reconciliation statement is prepared at the end of an accounting period only.||(0)|
|(ii)||At the time of receiving the goods, the consignee treats the consignor as a creditor.||(0)|
|(iii)||Trade discount is not recorded in the books of account.||(0)|
|(iv)||Interest on capital and salary to proprietor are incomes and hence are shown on the credit side of profit and loss account of the proprietary firm.||(0)|
|(v)||If the date of payment of a bill after taking into account the days of grace falls on a holiday, the payment of the bill is to be made on the following working day.||(0)|
(2 marks each)
|2.||(a)||Re–write the following sentences after filling–in the blank spaces with appropriate word(s)/figure(s)|
|(i)||When the bank column of the columnar cash book shows a credit balance, it means that there is a bank ____________.||(0)|
|(ii)||Acceptance of a bill of exchange is an acknowledgement of ____________.||(0)|
|(iii)||____________ account is prepared at the time of dissolution of a firm.||(0)|
|(iv)||Real account usually shows a ____________ balance.||(0)|
|(v)||When goods are returned to a supplier, a ____________ note is sent to him.||(0)|
|(vi)||Joint venture account is a ____________ account prepared to find out profit or loss of the joint venture.||(0)|
|(vii)||____________ is the amount which a non-trading concern receives as per the will of a deceased person.||(0)|
|(viii)||Promissory note contains an unconditional ____________ to pay a certain sum of money to a certain person or to his order after the specified period of time.||(0)|
(1 mark each)
|(b)||Distinguish between any two of the following :|
|(i)||‘Reserve’ and ‘provision’.||(0)|
|(ii)||‘Bill of exchange’ and ‘promissory note’.||(0)|
|(iii)||‘Sale’ and ‘consignment’.||(0)|
(4 marks each)
|3.||(a)||Write the most appropriate answer from the given options in respect of the following:|
|(i)||For a non–trading concern, subscription received in advance is – |
|(ii)||A manager is entitled to a commission @ 5% on profits before deducting such commission. In an accounting year, gross profit is Rs. 96,000 while selling and office expenses, other than commission to manager, totalled Rs. 12,000. Manager’s commission for the year will be – |
|(iii)||If an amount written off as a bad debt is recovered subsequently, it will be – |
|(iv)||Cash purchases are made of goods at the list price of Rs. 40,000 at a trade discount @ 5% and a cash discount @ 2%; cash payable is – |
|(v)||At the end of an accounting year, total debtors are Rs. 1,00,000. Provision for bad debts and for discount on debtors are made @ 5% and 2% respectively. The amount of provision for discount on debtors will be – |
|(vi)||The primary record of a credit purchase of a fixed asset is made in– |
|(vii)||A firm took an insurance policy against fire for Rs. 50,000. The policy contained an average clause. A fire occurred. On the date of fire, goods costing Rs. 75,000 were available in the stores. Goods salvaged totalled Rs. 15,000. The insurance company will admit a claim for – |
|(viii)||Closing stock is shown in the trial balance. When preparing the final accounts of a business concern, the closing stock is shown – |
(1 mark each)
|(b)||Explain any two of the following statements:|
|(i)||No transaction can break the accounting equation||(0)|
|(ii)||Receipts and payments account is a summary of cash book.||(0)|
|(iii)||Columnar cash book is a combination of cash account and bank account.||(0)|
(4 marks each)
|4.||A, B and C were equal partners. The following was their balance sheet as on 31st March, 2012 : |
They agreed to take D into partnership with effect from 1st April, 2012 on the following terms :
Prepare revaluation account and all the partners’ capital accounts. Also draw the initial balance sheet of the new firm as on 1st April, 2012.
|5.||(a)||Ravi and Kavi entered into a joint venture to purchase and sell new year gift items. They agreed to share the profits and losses equally. On 4th November, 2011, Ravi purchased goods worth Rs. 2,00,000 and spent Rs. 12,000 in sending the goods to Kavi. He also paid Rs. 4,000 for insurance. On the same date, Ravi drew a bill of exchange upon Kavi for Rs. 2,00,000 at 2 months. On 7th November, 2011, he got the bill discounted at 18% per annum. |
Kavi spent Rs. 6,000 on cartage, Rs. 10,000 as rent and Rs. 10,000 on advertisement. He sold all the gift items for Rs. 4,00,000 after retaining gift items worth Rs. 4,000 for his personal use. He sent a cheque to Ravi for the amount due on 8th January, 2012.
You are required to prepare – (i) memorandum joint venture account; and (ii) joint venture with Kavi account in the books of Ravi.
|(b)||While preparing a trial balance, an accountant found a difference of Rs. 1,980. The difference was placed on the credit side of a newly opened suspense account. Later on, the following errors were discovered : |
|6.||Avdesh commenced business on 1st April, 2011 with a capital of Rs. 9,00,000. He immediately purchased furniture of Rs. 4,80,000. During the year, he received from his uncle a gift of Rs. 60,000 and he borrowed from his father a sum of Rs. 1,00,000. He had withdrawn Rs. 12,000 per month for his personal expenses. Avdesh did not maintain any books of account. |
However, the following information is available :
He used goods worth Rs. 26,000 for his personal use and paid Rs. 10,000 to his son for examination and college fees. On 31st March, 2012, his debtors were Rs. 4,20,000 and creditors were Rs. 3,00,000, stock in trade was valued at Rs. 2,00,000. Furniture was to be depreciated @ 10% per annum.
Prepare the trading and profit and loss account for the year ended on 31st March, 2012.
|7.||(a)||On 30th June, 2011, an accidental fire destroyed a major part of the stocks in the godowns of Viki Associates. Stock costing Rs. 30,000 could be salvaged but not their store ledgers. A fire insurance policy with an average clause was in force under which the sum insured was Rs. 3,50,000. From available records, the following information was made available : |
Prepare a statement showing the insurance claim recoverable.
|(b)||On 31st December, 2011, the debit bank balance according to cash book of a trader was Rs. 6,000. On comparison with the pass book, the following information was gathered : |
Prepare the bank reconciliation statement as on 31st December, 2011.
|8.||(a)||SPL Ltd., which depreciates its machinery @ 10% per annum according to diminishing balance method, had on 1st April, 2011 a balance of Rs. 9,72,000 in its plant and machinery account. During the year ended 31st March, 2012, the plant and machinery purchased on 1st April, 2009 for Rs. 1,20,000 was sold for Rs. 80,000 on 1st October, 2011 and a new machinery costing Rs. 1,40,000 was purchased and installed on the same date; installation charges being Rs. 10,000. |
The company wants to change its method of depreciation from diminishing balance method to straight line method with effect from 1st April, 2009 and adjust the difference before 31st March, 2012, the rate of depreciation remaining the same as before.
Show the machinery account for the year ended 31st March, 2012.
|(b)||Calculate the amount of stationery used for the accounting year ended 31st March, 2012 : |