Sku-Aa2em - BL2015 - T

1
SYLLABUS
B.Com. Second Year
ADVANCED ACCOUNTING
UNIT I: Accounts from Incomplete Records - Hire purchase and installment purchase system.
Single Entry: Features books and accounts maintained- Recording of
transactions -Ascertainment of Profit. ( Statement of Affairs method only).
Hire Purchase System - Features - Accounting Treatment in the Books of Hire
Purchaser and Hire Vendor - Default and Repossession - Installment Purchase System Difference between Hire purchase and Installment purchase systems -Accounting
Treatment in the books of Purchaser and Vendor
UNIT-II : Accounting of Non-Profit Organizations:
Non-Profit entities-Features of non-profit entities Accounting process-Preparation
of summaries -Receipts and Payments Account meaning and special features-Procedure
for preparation-uses and limitations.
Income and Expenditure Account- features- procedure for preparationpreparation of Balance Sheet
UNIT - III : Partnership Accounts:
Legal provisions in the absence of Partnership Deed - Fixed and Fluctuating
Capitals Preparation of final accounts. Accounting Treatment of Goodwill and
Admission of a partner.
UNIT IV: Accounting treatment of Retirement and Death of a Partner
Accounting treatment relating to Goodwill Ratio of gain settlement of amount
due to the retiring parter/ to the
of the deceased partner (excluding joint life
policy).
Dissolution of Firm (Excluding Sale to Firm, Company and Amalgamation)
Recording of partnership transaction and preparation of final accounts using computers.
(24 hours)
UNIT-V : Company Accounts:
Issue of Shares at par, Premium and at Discount - Forfeiture and Reissue of
Shares-Rights issue (Theory Only) - Recording of transactions relating to issue of shares
using computers.
Issue and Redemption of Debentures - Redemption out of profits sinking fund
method. Recording of transaction relating to issue and redemption of debentures using
computers
Underwriting of Issue of Shares (Simple Problems) .
SKU(AA2EM) OCTOBER 2010
82
Rs Capital Should be for 3 Shares
PAPER VI (552 BI) ADVANCED ACCOUNTING

Time : 3 Hrs]
Capitals = 21,000: 17,500 : 10,500 : 7,000

Cr
7,000
7,000
Dr
Capital A/cs
Cr
Particulars
P
Q
R
S Particulars
P
Q
R
S
To Cash
1,750 1,625
----- By Bal. C/d 19,000 16,000 8,000
--To Bal. C/d 21,000 17,500 10,500 7,000 By Goodwill 1,800 1,500
900
--By Profit
1,950 1,625
975
--By Cash
----625 7,000
22,750 19,125 10,500 7,000
22,750 19,125 10,500 7,000
Dr
To Balance b/d
To Ss Capital
To Goodwill
To Rs Capital
Cash A/c
900
By Ps Capital
7,000
By Qs Capital
4,200
By Balance c/d
625
12,725
Balance Sheet as on 31.12.2000

Creditors
9,000 Land & Buildings(24,000+7,000)
Bills Payable 3,000 Furniture (3,500 420)
Capitals
Stock (14,000 1,400)
P
21,000 Debtors (12,600 630)
Q
17,500 Cash
R
10,500
S
7,000
68,000
II B.Com DEGREE EXAMINATION, MARCH 2014.
7,000
3 10,500
2
Dr
P & L Adjustment A/c
420 By Land & Buildings
To Furniture(35,00012/100)
1,400
To Stock (14,00010/100)
To R.B.D
630
To Profit
P
1,950
Q
1,625
R
975 4,550
7,000
SKU(AA2EM) MARCH/APRIL 2014
SRI KRISHNADEVARAYA UNIVERSITY
7,000
Ps Capital should be for 6 shares=
6 21,000
2
7000
Qs Capital Should be for 5 shares
5 17,500
2
Cr
1,750
1,625
9,350
12,725
31,000
3,080
12,600
11,970
9,350
68,000
[Max. Marks : 70
PART A (5 6 = 30 Marks)
Answer any FIVE Questions
1. What are features of Hire Purchase system ?
2. State the features of income and expenditure account.
3. Fixed capital method - Discuss
4. From the following information prepare statement affairs and find out the
capital at the beginning
Rs.
Stock
20,000
Sundry creditors 30,000
Furniture
60,000
Machinery
80,000
Bank overdraft
10,000
Debtors
40,000
5. On 1st January, 2008 Messrs XYZ and Co. took delivery from ABC Co.
Ltd. of a machine on hire purchase system, Rs.1,500 being paid on delivery and
the balance in five instalments of Rs.3,000 each payable annually on 31st
December. The cash price of the machine was Rs.15,000. Calculate the amount
of interest for each year.
6. A Golf club has kept its accounts on cash basis and the figures for 2009
are given below. You are required to prepare receipts and payments account for
the year.
Rs
Entrance fees received
2,500
Subscriptions received
19,800
Gross fees received
600
Expenses paid
27,250
Surplus on Bar Account
7,500
Secretary's Honorarium
1,500
Cash in hand at (1.01.2009)
2,350
Locker rent received
500
Cash of investment bought during the year.
1,100
7. A, B and C are three partners sharing profit and losses in the ratio of 4:3:2.
B retires and the goodwill of the firm is valued at Rs.5,400. No goodwill appears as
yet in the books of the firm. A and C decide to share profits in the future in ratio of
5:3 and that no goodwill account will be raised in the books of the firm. Pass
Journal entry / entries.
8. Quick Ltd. issued shares of Rs.10 each at a premium of Rs.2 Mr. Pal who
is allotted 200 shares could not pay the final call amount of Rs.4 on each share.

4
His shares are forfeited and reissued at Rs.10 as fully paid. Write necessary
entries.
PART B (4 10 = 40 Marks)
Answer any FOUR Questions.
9. What is single Entry System ? Describe its features, advantages and
disadvantages.
10. Explain different methods treating good will on admission of a partner.
11. The Chennai Co. Ltd. Purchased machinery from Mumbai Co. on
installment purchase system on 01.01.2006, Paying cash Rs.20,000 and agreeing
to pay three equal installments of Rs.20,000 each on 31st December of every year.
The cash price of the machinery is Rs.74,500. The Mumbai Co. charges interest
@ 5% p.a. The Chennai Co. Writes off 10% p.a. on the straight line method. Show
the ledger accounts in the books of Chennai Co. Ltd.
12. The receipts and payment account of Kamal Sports club for the year
ending 31.03.2011 was as follows :
Particulars
Rs
Particulars
Rs
Cash in hand
600 Ground plan fee
4,000
Cash at Bank
5,000 Grass cutting machine
3,000
Subscriptions received 16,000 Rent
2,000
Tournament fund
6,000 Salary to coach
8,000
Life Membership fee
4,000 Tournament expenses
2,400
Entry fee
1,000 General expenses
5,600
Donations for pavilion
9,000 Purchases of sports material
3,000
Sale of newspapers
400 Cash in hand
3,000
Sale of grass
1,000 Cast at bank
12,000
43,000
43,000
Additional information :
a) The outstanding subscriptions for the year ending 31.03.2010 and
31.03.2011 was Rs.2,000 and 3,000 respectively.
b) Subscriptions received includes Rs.600 for the year 2012.
c) The value of sports material at the end of 31.03.2010 and 31.03.2011 was
Rs.2,400 and Rs.2,600 respectively
d) Gross cutting machine was purchased on July 1, 2010, calculate
depreciation at 20%
e) The outstanding salaries for coach Rs.2,000
You required to prepare income and expenditure account and Balance
sheet of Kamal sports club for the year ending 31st March 2011.
13. Varma and Sharma are partners in a firm sharing profits in the ratio of 2:1
The balance sheet as on 31.03.2012 was as follows :
Liabilities
Rs
Assets
Rs
Creditors
16,000 Profit and Loss A/c
6,000
General reserve
24,000 Cash
6,000
Varma capital A/c
40,000 Debtors
60,000
Sharma capital A/c
30,000 Stock
16,000
Furniture
2,000
81
31-12-08 By P & L App.
5,70,515
By Interest
5,70,515
31-12-08 To Bal. c/d

31-12-09 To Bal. c/d
31-12-10 To S.F. Investment A/c

To General
Reference to Debenture
Dr
Date
31-12-06
Particulars
To bank
01-01-07 To Bal. b/d

31-12-07 To Bank
01-01-08 To Bal. b/d
31-12-08 To Bank
01-01-09 To Bal. b/d
31-12-09 To Bank
01-01-10 To Bal. b/d
7,80,010 01-01-09
31-12-09
31-12-09
7,80,010
4,000 01-01-10
10,00,000 31-12-10
By Bal. b/d
By P & L App.
By Interest
By Bal. b/d
By P & L App.
By Interest
By P & L A/c
10,04,000
Sinking Fund Investments A/c

Rs.
Date
Particulars
1,80,900 31-12-06 By Bal. c/d
1,80,900
1,80,900 31-12-07 By Bal. c/d
1,90,000
3,70,900
3,70,900 31-12-08 By Bal. c/d
1,99,500
5,70,400
5,70,400 31-12-09 By Bal. c/d
2,09,500
7,79,900
7,79,900 01-01-10 By S.F. A/c (Loss)
By Bank
7,79,900
16.
Working Notes :
1) Calculation of New profit Sharing ratio:th
1
1 7
Share given to S Remaining Share is 1
8
8 8
7 6
6
Ps New Share
8 14 16
7 5
5
Qs New Share =
8 14 16
7 3
3
Rs New Share
8 14 16
1
2
or
Ss Share
8
16
Ratio = 6 : 5 : 3 : 2
2) Capital Adjustments :Ss Brings Capital for 2 shares = 7,000
1,80,975
18,545
5,70
,515
5,70,515
1,80,975
28,520
7,80,010
7,80,010
1,80,975
38,995
4,020
10,04,000
Cr
Rs.
1,80,900
1,80,900
3,70,900
3,70,900
5,70,400
5,70,400
8,79,900
7,79,900
4,000
7,75,900
7,79,900

31-12-08
31-12-09
31-12-10
"
"
80
(Being the Investment, purchased)

Bank A/c
Dr
To Interest A/c
[(1,90,0005/100) 9500+9045]
(Being the Interest received)
P&L App. A/c
Dr
Interest A/c
Dr
To S. Fund A/c
(Being the S.F. was provided)
S.F. Investments A/c
Dr
To Bank
(Being the Investments purchased)
Bank A/c
Dr
To Interest A/c [1995005/100=9975+18545]
P & L App. A/c
Dr
Int. A/c
Dr
To S. Fund A/c
S.F. Investment A/c
Dr
To Bank
(Being the Investments purchased)
Bank A/c
Dr
To Investment A/c
2095005/100 = (15475+28520)
P & L App. A/c
Dr
Interest A/c
Dr
To S.F. A/c
Bank A/c
Dr
S.F A/c
Dr
To S.F. Investments A/c
(Being the Investments was sold)
P & L A/c
Dr
To S.F. A/c
(Being the loss on Sale of Investments
Debentures A/c
Dr
To bank
(Being Debentures redeemed)
Dr
31-12-06 To Bal. c/d
31-12-07 To Bal. c/d
5
20,000
1,10,000
1,10,000
They have decide to admit Dharma as a new partner with one fourth share in
future profits, subject to the following conditions, on 1st April 2012.
a) Dharma has to bring Rs.21,000 of which Rs. 9,000 will be treated as a
goodwill to be retained in the business.
b) 50% of reserve is to be remain as reserve for doubtful debts.
c) Depreciate furniture @ 5% p.a. and fixed assets being 10% p.a.
d) Stock to be revalued at Rs.10,500.
Prepare revaluation account, partners capital accounts and balance sheet of the
firm after admission of Dharma as on 1.04.2012.
14. Daniel, Edward and Fernandez are equal partners in a firm. Their Balance.
Sheet on 01.01.2013 is given below
Liabilities
Rs
Assets
Rs
Bills payable
2,000 Cash in hand
600
Profit and Loss A/c
500 Sundry debtors 10,800
Reserve fund
800 Stock
11,400
Sundry creditors
6,000 Furniture
2,400
Capital :
Buildings
19,500
Daniel
16,800
Edward
12,600
Fernandez
6,000
44,700
44,700
They admitted Herald Ross on the above date by giving him share on the
following conditions:
a) Herald Ross brings capital of Rs.15,000
b) He should bring goodwill, Rs.9,000. The Old partners withdraw half - of their share of goodwill.
c) Furniture and stock reduced by 10%
d) 5% reserve is created on debtors
e) Liability on bills discounted dishonored, Rs.1,080
f) Buildings revalued as Rs.27,000
Show the important ledger accounts and the new balance sheet of the firm after
admission.
15. A, B and C sharing profits and losses equally had been trading for many
years. 'C' decided to retire on 31.12.2012. On which date Balance sheet of the
firm was as follows.
Liabilities
Rs
Assets
Rs
Creditors
80,000 Cash
30,000
Capitals :
Debtors
60,000
A
1,00,000
Stock
50,000
B
80,000
Plant and Machinery 1,00,000
C
60,000 2,40,000 Land and Buildings
80,000
3,20,000
3,20,000
Fixed assets
18,545
18,545
1,80,975
18,545
1,99,520
1,99,500
1,99,500
28,520
28,520
1,80,975
28,520
2,09,495
2,09,500
2,09,500
38,995
38,995
1,80,975
38,995
2,19,970
8,75,900
4,000
8,79,900
9,020
9,020
10,00,000
Sinking Fund A/c

1,80,975 31-12-06 By P & L App. A/c
1,80,975
3,70,995 01-01-07 By Bal. b/d
31-12-07 By P & L App.
By Investment
3,70,995
01-01-08 By Bal. b/d
10,00,000
Cr
1,80,975
1,80,975
1,80,975
1,80,975
9,045
3,70,995
3,70,995

6
The value of the goodwill was agreed as Rs.81,000. The land and buildings has
increased in value, the value being agreed at Rs.1,10,000. Plant and machinery
was revalued at Rs.88,000 and it was agreed to provide 5% in respect of debtors.
Prepare Memorandum Revelation Account, Capital Accounts and Balance sheet.
16. 'X' limited invited applications for 1,00,000 shares of Rs.10/- each at a
discount of 6% payable as follows :
On application Rs.2.50; On allotment Rs.3.40 and on first and final call
Rs.3.50 the application received were for 90,000 shares and all of these were
accepted. All money due was received except the first and final call on 1,000
shares.
Pass necessary journal in the books of company. Also show how these
transaction would appear in Balance sheet of the company.
SOLUTIONS SKU (AA 2 EM) MARCH / APRIL 2014
PART A
1. What are features of Hire Purchases system ?
Ans: Refer Q.no.80, Page no.48.
2. State the features of income and expenditure account.
3. Fixed capital method - Discuss
4.
Statement of affairs
Liabilities
Rs.
Assets
Rs
Sundry creditors
30,000 Stock
20,000
Bank over draft
10,000 Debtors
40,000
Capital (b/f)
1,60,000 Furniture
60,000
Machinery
80,000
2,00,000
2,00,000
5. Calculation of Interest
Down payment
1,500
(+) Installments (53,000) 15,000
Hire purchases price
16,500
(-) Cash Price
15,000
Interest
1,500
Interest will distribute in the ratio of 5:4:3:2:1
Interest in 1st Installment (15005/15) =
500
nd
400
Interest in 2 Installment (1,5004/15) =
Interest in 3nd Installment (1,5003/15) =
300
Interest in 4nd Installment (1,5002/15) =
200
nd
Interest in 5 Installment (1,500 1/5) =
100
1,500

Dr
To Debtors
To Stock
To Furniture
To Plant
To Bank (creditors) (4000 80)
To P's A/c
To Profit:
P
Q
R
P
To Realization
To Bank
900
To Bank
11,644
12,544
79
Realization A/c
4,000 By Creditors
5,000 By Bank (Assets realized)
2,000 By Q's A/c
9,000
3,920
120
424
424
212
Cr
4,000
20,700
400
1,060
25,100
25,100
Capital Accounts
Q
R
P
Q
R
400
- By Balance b/d 10,000 4,000 2,000
By Reserve fund 2,000 2,000 1,000
6,024 3,212 By Realization
120
By Realization
424 424 212
6,424 3,212
12,544 6,424 3,212
Bank A/c
To Bal. b/d
5,000 By Realization
To Realization A/c 20,700 By P's capital
By P capital
By Q's capital
By R's capital
25,700
3,920
900
11,644
6,024
3,212
25,700
15.
Journal Entries
Date
Particulars
1-1-06 Bank A/c
To 12% Debentures A/c
(Being the Debentures Issued)
31-1206 P& L appreciation A/c
To Sinking Fund A/c
(Being the Sinking Fund was provided)
3 S.F. Investments A/c
To Bank
(Being the investments purchased)
31-12-07 Bank A/c
To Interest on Investments A/c
" P&L App. A/c
Interest A/c
To Sinking fund A/c
(Being the SF was provided)
" S.F. Investments A/c
To Bank
LF
Dr
Dr
Debit
Credit
10,00,000
10,00,000
1,80,925
1,80,925
Dr
1,80,900
1,80,900
Dr
9,045
9,045
Dr
Dr
1,80,975
9,095
1,90,020
1,90,000
1,90,000

Due (1,00,0005)
(-) Calls in arrears (8005)
Cash collected
78
5,00,000
4,000
4,96,000
Cash Book
To Equity Share application A/c
3,00,000 By Balance c/d 12,01,200
To Share Allotment A/c
3,98,800
To First & Final Call A/c
4,96,000
6,400
To Share Capital (re-Issued) (8008)
12,01,200
12,01,200
Journal Entries in the Books of Y Ltd.
Date
Particulars
LF
1 Equity Share Application A/c
Dr
To Share Capital A/c
(Being the application Money transfer to Capital A/c)
2 Share application A/c
Dr
(Being the Over application Money transfer to due on allotment
Money)
3 E-Share Allotment A/c
Dr
To E.S. capital A/c
To Share premium A/c
(Being the allotment Money due on 1,00,000 shares of Rs.3
each and premium 2/- each)
4 First & Final call A/c
Dr
(Being to Calls Money due on 1,00,000 Shares of Rs. 5 each)
5 Share Capital A/c (80010)
Dr
Share Premium A/c (3002)
Dr
To Share forfeiture A/c (4502) + (5005)
To First & Final Call A/c (8005)
(Being the 800 shares were forfeisted as per resolution)
6 Bank A/c (8008)
Dr
Share forfeiture A/c (8002)
Dr
To Share capital A/c
(Being the forfeisted shares were reinvested)
7 Share forefeiture A/c
Dr
To Capital Reserve A/c (3400-1600)
(Being the forefeiture A/c balance transfer to capital Reserve)
Balance Sheet
Liabilities
Rs.
Assets
Issued & Paid up Capital
1,00,000 Equity Shares of Rs.10 each 10,00,000 Cash Balance
Share Premium (2,00,000 600)
1,99,400
Capital Reserve
1,800
2,01,200
14.
Debit Credit
2,00,000
2,00,000
1,00,000
1,00,000
5,00,000
3,00,000
2,00,000
5,00,000
5,00,000
8,000
600
3,400
1,200
4,000
6,400
1,600
8,000
1,800
1,800
Rs.
12,01,200
12,01,200

7
6. Refer Q.no.1, Page no.89.
7.
Journal Entry
Date
Particulars
LF Debit Credit
Goodwill A/c
Dr
5,400
To A capital A/c (5,400 4/9)
2,400
To B Capital A/c (5,4003/9)
1,800
To Capital A/c (5,4002/9)
1,200
(Being goodwill created)
A capital A/c (5,40013/24)
Dr
2,925
C Capital A/c (5,40011/24)
Dr
2,475
To goodwill A/c
5,400
(Being goodwill written off in gaining ratio)
Note : At the time of retirement of a partner, the continuing partners may gain
something. So goodwill must be adjusted in gaining ratio.
gaining Ratio = New share old share
A = 5/8 4/9 = 45-32/72 = 13/72
C = 3/8 2/9 = 27-16/72 = 11/72
Gaining Ratio = 13 : 11
8.
Journal Entries
Date
Particulars
LF Debit Credit
2,000
Share capital a/c (20010)
Dr
800
To share final call A/c (2004)
To share forfeiture A/c
1,200
(Being 200 shares are forfeited for non payment of call)
2,000
Bank A/c (20010)
Dr
To share capital A/c
2,000
(Being 200 shares are reissued)
Share forfeiture A/c
Dr
1,200
To captal Reserve A/c
1,200
(Being forfeiture account transferred to capital Reserves
PART B
9. What is single Entry System ? Describe its features, advantages and
disadvantages.
Ans: Refer Q.no.1 and 2 in Page no.1.
10. Explain different methods treating good will on admission of a
partner.
Ans: Refer Q.no.20 and 2 in Page no.17.
11.
Analysis Table
No.of Installments Cash price Interest Principle Installments
74,500
1.1.06
20,000
--20,000
20,000
54,500
31.12.06
17,275
2,725
17,275
20,000

8
37,225
31.12.07
18,139
1,861
18,139
20,000
19,086
31.12.08
19,086
914
19,086
20,000
--5,500
74,500
80,000
Ledger Accounts in the books of Chennai & Co.
Dr
Machinery A/c
Cr
Date
Particulars
Rs
Date
Particulars
Rs
1.1.06 To Mumbai Co. A/c
74,500 31.12.06 By Deprecation
7,450
(74,50010%)
By Balance c/d
67,050
74,500
74,500
1.1.07 To Balance b/d
67,050 31.12.07 By Depreciation
7,450
By Balance c/d
59,600
67,050
67,050
7,450
By Balance c/d
52,150
59,600
59,600
52,150
Dr
Mumbai Company A/c

Date
Particulars
Rs
Date
Particulars
1.1.06
To cash a/c
20,000 1.1.06 By Machine A/c
31.12.06 To cash A/c
20,000
By Interest suspense A/c
To Balance c/d 40,000
80,000
31.12.07 To Cash A/c
20,000 1.1.07 By Balance b/d
To Balance c/d 20,000
40,000
31.12.08 To Cash A/c
20,000 1.1.08 By Balance b/d
20,000
Cr
Rs
74,500
5,500
80,000
40,000
40,000
20,000
20,000
Dr
Interest A/c
Date
Particulars
Rs
Date
Particulars
31.12.06 To Interest suspense A/c 2,725 31.12.06 By Profit & Loss A/c
2,725
31.12.07 To Interest suspense A/c 1,861 31.12.07 By Profit & Loss A/c
1,861
31.12.08 To Interest suspense A/c
914 31.12.08 By Profit & Loss A/c
914
Cr
Rs
2,725
2,725
1,861
1,861
914
914
Dr
Interest Suspense A/c
Date
Particulars
Rs
Date
Particulars
1.1.06 To Mumbai company A/c
5,500 31.12.06 By Interest A/c
Cr
Rs
2,725

Expenditure
To Salaries
To Printing
To General Expenses
77
Rs.
Income
20,000 By Subscriptions
22,000 (-) Last year due
4,000
(+) o/s
To Loss on Sale or Investments

(45000-42000)
Rs.
(-) Received in Advance
90,000
6,000
84,000
7,800
91,800
500
By Interest
(+) O/S Interest
10,200
1,500
3,000
91,300
11,700
To Surplus
54,000
1,03,000
Liabilities
Creditors
Capital fund
Balance Sheet as on 30-06-2004

Rs.
Assets
4,000 Buildings
Investments
O/S Subscriptions
79,800 Cash Balance
79,800
1,03,000
Rs.
20,000
50,000
6,000
3,800
79,800

Liabilities
Rs.
Assets
Rs.
Capital fund
79,800
Buildings
20,000
(-) Surplus
54,000 1,33,800 (+) Purchases
1,55,000 1,75,000
Donating for Buildings
80,000 Investments
50,000
Subscriptions Rec.
(+) Purchases
20,000
in advance
500
70,000
(-) Sale of Investments 45,000 25,000
Accrued Interest
1,500
o/s subscriptions
7,800
Cash Balance
5,000
2,14,300
2,14,300
13.
1. Application Money at
Cash collected (1,50,0002)
Transfer to capital (1,00,0002)
Adjusted to Allotment
2. Allotment Money 5/Due (1,00,0005)
Adjusted from Application
3,00,000
2,00,000
1,00,000
5,00,000
1,00,000
4,00,000
1,500
(-) Over Application Money (1502) 300 1,200
Cash collected
3,98,800
3. Ist & Final Call Money 5/-

Dr.
Date
Particulars
1.1.96 To Bank
76
Motor Lorries A/c

Rs.
Date
Particulars
54,550 31.12.96 By Depreciation (5455025/100)
By Balance c/d
54,550
40,912 31.12.97 By Depreciation (4091225/100)
By Balance c/d
40,912
30,684 31.12.98 By Depreciation (3068425/100
By Balance c/d
30,684
23,013 31.12.99 By Depreciation (2301325/100)
By Balance c/d
23,013
17,260
Dr.
Date
01-01-96
31-12-96
Particulars
To Cash
To Cash
To Balance c/d
31-12-97
To Cash
To Balance c/d
31-12-98
To Cash
To Balance c/d
31-12-99
To Cash
Vendor A/c
Rs.
Date
12,000 01-01-96
12,000 31-12-96
32,678
56,678
12,000 01-01-97
22,312 31-12-97
34,312
12,000 01-01-98
11,427 31-12-98
23,427
12,000 01-01-99
Particulars
By Motor Lorries A/c
By Interest A/c
By Balance b/d
By Interest
By Balance b/d
By Int.
By Balance b/d
By Int.
12,000
Dr.
Date
31-12-96
31-12-97
31-12-98
31-12-99
Particulars
To Vendor A/c
To Vendor A/c
To Vendor A/c
To Vendor A/c
Dr.
Date
31-12-96
31-12-97
31-12-98
31-12-99
12.
Dr.
Particulars
To Motor Lorries
To Motor Lorries
To Motor Lorries
To Motor Lorries
Interest A/c
Rs.
Date
2,128 31-12-96
1,634 31-12-97
1,115 31-12-98
573 31-12-99
Depreciation A/c
Rs.
Date
13,638 31-12-96
10,228 31-12-97
7,671 31-12-98
5,753 31-12-99
Cr
Rs.
13,638
40,912
54,550
10,228
30,684
40,912
7,671
23,013
30,684
5,753
17,260
23,013
Cr
Rs.
54,550
2,128
56,678
32,678
1,634
34,312
22,312
1,115
23,427
11,427
573
12,000
Particulars
By P & L A/c
By P & L A/c
By P & L A/c
By P & L A/c
Cr
Rs.
2,128
1,634
1,115
573
Particulars
By P & L A/c
By P & L A/c
By P & L A/c
By P & L A/c
Cr.
Rs.
13,638
10,228
7,671
5,753

By Balance c/d
Dr
12.
Income & expenditure A/c for the year ending 31.3.11

Cr
Expenditure
Rs
Income
Rs
To Ground plan fee
4,000 By subscriptions
16,000
To Rent
2,000 (+) Outstanding
3,000
To Salary to coach
8,000
19,000
(+) out standing
2,000 10,000 (-) Outstanding for 2010 2,000
To General expenses
5,600
17,000
To Depreciation :
(-) Pre-received
600 16,400
On gross cutting machine
450 By Entrance fee
1,000
On sports material
By Sale of news papers
400
(2,400 + 3,000 - 2,600)
2,800 By Sales of Grass
1,000
By Deficit
6,050
24,850
24,850
Balance sheet as on 31.3.2011
Liabilities
Rs
Assets
Rs
Tournament fund
6,000
Sports Material
2,600
(-) Tournament Expenses
2,400 3,600 Gross cutting machine 3,000
Life member ship fee
4,000
(-) Depreciation
Donations to pavilion
9,000
(3,00020/1009/12) 450 2,550
Capital fund
10,000
Cash in hand
3,000
23,000
Cash at Bank
12,000
(-) Deficit
6,050 16,950 Outstanding subscription
3,000
Outstanding salary to Coach
2,000
Pre-received subscription
600
23,150
23,150
Calculation of opening capital :
Particulars
Rs
Assets
Rs
Capital fund
10,000 Cash in hand
600
Cash at Bank
5,000
Sports material
2,400
Outstanding subscription
2,000
10,000
10,000
13.
Dr
Income & Expenditure A/c for the year ending 30-06-05
Cr.
5,500
2,775 31.12.07 By Interest A/c
By Balance c/d
2,775
914 31.12.08 By Interest A/c
914
9
2,775
5,500
1,861
914
2,775
914
914
Revaluation Account
Rs
Cr
Rs

To Furniture (20005/100)
To Fixed Asset (2000010/100)
To Stock
Dr
Particulars
To P & L A/c
To Revaluation A/c
To Balance c/d
10
100 By Loss:
2,000
Varma Capital A/c
5,500
Sharma Capital A/c
7,600
Capital Accounts
Varma Sharma Dharma Particulars
4,000 2,000
--- By Balance b/d
5,067 2,533
--- By Cash
44,933 32,467 12,000 By Goodwill
By General
Reserve
(2400050/100)
54,000 37,000 12,000
5,067
2,533 7,600
7,600
4,000
14.
Rs
1,900
18,000
10,500
48,000
27,000
1,05,400
Profit and Loss Adjustment A/c

Particulars
Rs
Particulars
240
By
Buildings
To Furniture (2,40010/100)
1,140 (27,000-19,500)
To Stock (11,40010/100)
540
To R.B.D. (10,8005/100)
To Unrecorded liability
1,080
To Daniel capital A/c
1,500
To Edward capital A/c
1,500
To Fernandez capital A/c
1,500
7,500
Dr
Particulars
Capital Accounts
Daniel Edward Fernandez Herald
To Cash
1,500 1,500
To Balance c/d 20,232 16,034
Particulars
---
54,000 37,000 12,000

Liabilities
Rs
Assets
Capital
Furniture
2,000
Varma
44,933
(-) Depreciation
100
Sharma 32,467
Fixed Assets
20,000
Dharma 12,000
89,400 (-) Depreciation
2,000
Creditors
16,000 Stock
Debtors
60,000
(-) RBD
12,000
Cash
1,05,400
Dr
7.
Cr
Varma Sharma Dharma
40,000 30,000
------- 12,000
6,000 3,000
8,000
Cr
Rs
7,500
7,500
Cr
Daniel Edward Fernandez Herlad
1,500 --- By Balance b/d

16,800 12,600
9,434 15,000 By Profit & Loss A/c 166 167
By Reserve fund
266 267
By Goodwill
3,000 3,000
By Cash
----By P & L
6,000
--167
--267
--3,000
----- 15,000
75
Calculation of Cash Price of a Machine.

No. of Instalment
Interest
Cash Price
Instalments Amount
31-12-02
8,800 (8800 10/110)
800
8,000
01-12-01
8,900 (8900 + 8000) 10/110
1,536
7,364
31-12-00
6,400 (6400 + 7364 + 8000)10/110 1,979
4,421
01-01-00
6,000
--6,000
30,100
4,315
25,785
8.
Journal Entries in the Books of Y Ltd.
Date
Particulars
LF Debit Credit
1 Bank A/c
Dr
2,00,000
To Share Application A/c
2,00,000
(Being the application Money received on 1,00,000 Sales of Rs. 2/- each)
2 Share Application A/c
Dr
2,00,000
2,00,000
(Being to application Money transfer to capital)
3 Share Allotment A/c
Dr
3,00,000
3,00,000
(Being the Allotment Money due on 1,00,000 shares of Rs.3 each of per reputation)
4 Bank A/c
Dr
3,00,000
3,00,000
(Being the allotment Money received)
5. Share calls A/c
Dr
3,00,000
3,00,000
(Being the calls Money on 1,00,000 shares of Rs.3 each as per resolution)
6. Bank A/c
Dr
3,00,000
To Share Calls A/c
3,00,000
(Being the Calls Money received)
9. Define distinction between Hire purchase system and Instalment system.
Ans: Refer QNo.8, Page 6
10. What are the contents in the Partnership-Deed?
11.
Analytical Table
No. of Instalments Cash Price Interest Principle Instalment Amount
54,550
Down (1-1-96)
12,000
--12,000
12,000
42,550
31-12-96
9,872
2,128
9,872
12,000
32,678
31-12-97
10,366
1,634
10,366
12,000
22,312
31-12-98
10,885
1,115
10,885
12,000
11,427
31-12-99
11,427
573
11,427
12,000
5,450
54,550
60,000

Sundry Creditors
Bank Overdraft
Excess of Assets over
Liabilities (Capital) (b.f)
74
9,000
--27,000
36,000
7,500 Cash in Hand

3,600 Cash at Bank
Sundry Debtors
35,770 Stock in Trade
Fixtures
Plant
46,870
1,250
2,000
9,800
7,500
350
15,100
36,000
1,150
--13,300
14,000
320
18,100
46,870
Statement of Profit for the year ended 31.3.2005

Rs.
Capital as on 31.3.2005
35,770
(+) Drawings during the year
5,900
41,670
(-) Capital as on 1.4.2004
27,000
Profit during the year
14,670
Receipts and Payments A/c
Amount
Receipts
Payments
(Rs.)
To Balance b/d
By Salary
Cash in hand
500 By Rent
Cash at Bank
4,800 By Furniture
To Subscriptions
11,000 By Tournament Expenses
To Entrance fee
1,000 By Entertainment
By Periodicals
By Miscellaneous Expenses
By Bal. c/d
Cash in hand
Cash at Bank (B/F)
17,300
6.
Profit and Loss Appropriation A/c
Dr
for the year ending 31st December 2002
Particulars
Rs.
Particulars
To Interest on Capital
4,011 By Net Profit b/d
(38,4305/100=1,921.50)
(41,7905/100 = 2,089.50)
To P's Capital A/c (Profit)
9,747
To Q's Capital A/c (Profit)
9,747
23,505
Capital Accounts
P
Q
Particulars
Rs.
Rs.
To Drawings
7,500.00 10,500.00 By Balance b/d
To P's Capital A/c
--- 3,000.00 By Int. on Capital
To Balance c/d
45,598.50 40,126.50 By P & L App. A/c (Profit)
By Q's Capital A/c
(6,000 3,000)
53,098.50 53,626.50
Particulars
21,732 17,534
Dr
Particulars
To Balance b/d
To goodwill
To Herald capital A/c
To balance b/d
Dr
5.
Dr
Cr
Amount
(Rs.)
3,000
1,200
2,000
3,000
1,500
1,200
300
800
4,300
17,300
Cr
Rs.
23,505
23,505
P
Q
Rs.
Rs.
38,430.00 41,790.00
1,921.50 2,089.50
9,747.00 9,747.00
3,000.00
--53,098.50 53,626.50
Adjustment A/c 1,500 1,500

10,934 15,000
21,732 17,534
By Balance b/d
20,232 16,034
Cash A/c
Rs
Particulars
600 By Daniel capital A/c
9,000 By Edward capital A/c
15,000 By Fernandez capital A/c
By Balance c/d
24,600
20,100
11
1,500
10,934 15,000
9,434
--Cr
Rs
1,500
1,500
1,500
20,100
24,600
Goodwill A/c
Cr
Rs
Particulars
Rs
3,000 By cash
9,000
3,000
3,000
9,000
9,000
Liabilities
Rs
Assets
Rs
Bills payable
2,000 Cash in hand
20,100
Sundry creditors
6,000 Sundry debtors 10,800
Liability bills
1,080 (-) R.B.D.
540 10,260
Capitals :
Stock
11,400
Daniel
20,232 (-) Depreciation 1,140 10,260
Edward
16,034 Furniture
2,400
Fernandez
9,434 (-)Depreciation
240 2,160
Herald ross
15,000 Buildings
19,500
(+) Appreciation 7,500 27,000
69,780
69,780
15. Refer Q.no.18, Page no.122
16.
Journal
Date
Particulars
LF Debit Credit
Bank A/c
Dr
2,25,000
2,25,000
To Share application A/c (90,0002.5)
(Being shrre application money received)
Share application A/c
Dr
2,25,000
2,25,000
(Being application money transferred to share capital)
3,06,000
Share allotment A/c (90,0003.40)
Dr
54,000
Discount on issue of share A/c (90,0000.60)
Dr
3,60,000
To share capital A/c (90,0004)
(Being allotment due)
Particulars
To Daniel Capital A/c
To Edward capital A/c
To Fernandez capital A/c

12
Bank A/c
Dr
3,06,000
To share allotement
3,06,000
(Being allotment money received)
3,15,000
Share first and final call A/c (90,0003.50)
Dr
3,15,000
(Being call money due)
Bank A/c
Dr
3,11,500
To share first and final call
3,11,500
(Being call money was received)
Balance sheet of X Ltd
Particulars
Note no.
Rs
I. Equity and liabilities
1. Share holders funds:
Issued capital
1,00,000 shares @ 10 each
10,00,000
Subscribed, called up, capital
90,000 Share of Rs.10. each 9,00,000
(-) Calls in arrears
3,500
8,96,500
Paid up capital
8,96,500
II. Assets
1. Current Assets:
Bank
8,42,500
2. Other current Assets :
Discount on issue of shares
54,000
8,96,500

II B.Com DEGREE EXAMINATION, SEP./OCT. 2014
PAPER VI (552 B1) ADVANCED ACCOUNTING
Time : 3 Hrs]
[Max. Marks : 70
1. What is single entry system? State the differences between single entry
and double entry system.
2. Features of receipts and payments account.
3. State the legal provisions in the absence of partnership deed.
4. Calculate the amount of stationery debited to income and expenditure
account for the year 31.12.2013
Rs.
Stock of stationery on 1.1.2013
1,000
Creditors for stationery on 1.1.2013
600
Advance paid for stationery carried forward from 2012
200
Amount paid for stationery during the year 2013
4,400
73
Plant and Machinery 8,500

Furniture
1,500
Stock
7,000
Sundry Debtors
3,700
Creditors allowed a discount of 2% and P agreed to bear all liquidation expenses.
P was to be paid Rs.120 for these expenses. Actual expenses amounted to Rs.900
there was an unrecorded asset of Rs.500 which was taken over by Q at Rs.400.
Prepare the necessary accounts to close the books of the partnership.
15. On January 1, 2006 'X' Ltd. issued 12% Debentures for Rs.10,00,000 redeemable
at par at the end of 5 Years. A sinking funds has been established for the purpose
of redeeming of debentures. Reference to sinking fund tables shown that
Rs.0.180975. Invested at the end of each year @ 5% interest will yield Re. 1 at the
end of the 5 years.
Give the Journal entries and show the necessary ledger accounts based on the
following assumptions.
i) Investments are purchased in multiple of hundred.
ii) Investments yield on interest of 5% which is received annually and the same is
reinvested immediately.
iii) The Investments are realized at a loss of Rs.4,000.
16. P, Q and R share their profits in the ratio of 6/14, 5/14 and 3/14. Their Balance
Sheet as on 31-12-2000 was follows :
Liabilities
Rs.
Assets
Rs.
Creditors
9,000 Land Buildings
24,000
Bills Payable
3,000 Furniture
3,500
Capital
Stock
14,000
P
19,000 Debtors
12,600
Q
16,000 Cash
900
R
8,000
55,000
55,000
S for 1/8 share in the profits he brings capital Rs.7,000 and Rs.4,200/- as good will.
1) Depreciate furniture by 12% and stock by 10%
2) Increase land, building to Rs.31,000
3) Create 5% Reserve for Doubtful Debts on Debtors.
4) Old partners share profits in the old ratio only. Adjust P, Q, R capital accounts
based on S capital through cash account. Show the profit and loss adjustment
account and Balance Sheet.
ANSWERS SKU (AA EM) OCTOBER 2010

1. Differences between Single entry and Double entry system of Accounts.
Explain.
2. Distinction between Receipts and Payments Account & Income and
Expenditure account.
3. Forfeiture of shares and surrender of shares. Explain.
4.
Statement of Affairs of Reedy
Liabilities
1.4.2004 31.3.2005
Assets
1.4.2004 31.3.2005
72
PART B
Answer any FOUR questions
(410=40 Marks)
9. Define distinction between Hire purchase system and Instalment system.
10. What are the contents in the Partnership-Deed?
11. Praneeth Ltd. purchased Motor lorries on hire-purchase over a period of 4 years,
Rs. 12,000 was payable on Jan. 1, 1996 and the balance by 4 annual instalments
of Rs.12,000 each on 31st December the seller charges interest @ 5%, p.a. on
yearly balance, the cash price was Rs.54,550. Depreciation @ 25% on diminishing
balance was written off each year.
Show necessary ledger accounts in the books of the purchaser.
12. TIRUPATI friends club gives you their Receipts and Payments account and other
information. They request you to prepare their Income and Expenditure account for
the year ending 30-6-2005 and Balance Sheet as on that date.
Receipts and Payments account for the year ending 30.6.2005
Dr. Receipts
Rs.
Cr. Payments
Rs.
To Balance c/d
3,800 By Salaries
20,000
To Subscriptions
90,000 By Buildings
1,55,000
To Donations for buildings 80,000 By Purchase of Investments 20,000
To Sale of Investments
42,000 By Printing
22,000
To Interest
10,200 By General Expenses
4,000
By Balance
5,000
2,26,000
2,26,000
Additional Information :
a) Opening balances : Buildings Rs.20,000, Investments Rs.50,000, outstanding
subscriptions Rs.6,000.
b) Value of the Investments sold is : Rs.45,000
c) Interest due on Investments on 30-6-2005 Rs.1,500
d) Outstanding subscription on 30-6-2005 Rs.7,800
e) Subscription received in advance on 30-6-2005 Rs.500.
13. Rish Ltd. issue for public subscription 1,00,000 equity shares of Rs.10 each at a
premium of Rs.2 per share payable follows Rs.2 per share on application. Rs.5 per
share including premium on allotment and Rs.5 on first and final call per share.
Applications were received for 150000 shares allotment was made on pro-rata
basis. Sandya to whom 300 shares were allotted failed to pay allotment and final
call money. Thushar to whom 500 shares were allotted failed to pay final call.
These shares were subsequently forfeited after final call was made. All the
forfeited shares were re-issued to Poojitha as fully paid Rs.8 per share.
Pass Journal entries to record the transactions.
14. P. Q and 'R' are partners sharing profits and loses as to 2:2:1 their Balance Sheet
as on 31-3-2002 was as follows :
Liabilities
Rs.
Assets
Rs.
Creditors
4,000 Cash
5,000
Capitals P 10,000
Debtors
4,000
Q 4,000
Stock
5,000
R 2,000
16,000 Furniture
2,000
Reserve fund
5,000 Plant
9,000
25,000
25,000
They decided to dissolve the business. The following are the amounts realized.
Liabilities
Rs.
SKU(AA2EM) SEP./OCT. 2014

13
700
1,500
Advance paid for stationery on 31.12.2013
500
5. Ascertain the capital in the beginning with the following
Rs
Capital at the end
10,200
Capital introduced during the year
2,500
Drawings
1,500
Loss
1,000
6. A and B starts business with capital of Rs.80,000 and Rs.40,000 on 1st
Jan 2012. B is entitled to a salary of Rs.500 per month. Interest is allowed on
capitals and is charged on drawings at 6% p.a. Profits are to be distributed equally
after making above adjustments. During the year A withdrawn Rs.8,000, and B
Rs.10,000. Profits before adjustments amounted to Rs.50,000. Show the profit
and loss appropriation A/c.
7. X, Y and Z are partners sharing profits and losses in the ratio of 4:3:2. Y
retires and the goodwill of the firm is valued at Rs.10,800. No goodwill appears as
yet, in the books of the firm. X and Z decides to share profits in future in the ratio
of 5:3 and not to show in future the goodwill in the books of the firm. Pass
necessary journal entries to treat the goodwill.
8. Lakshmi company Ltd., issued 25,000 equity shares of Rs.10 each,
payable Rs.2 on application, Rs.4 on allotment; Rs.3 on first call and Rs.1 on final
call. All the shares were subscribed and the amount duly received. Pass Journal
entries.
9. What is meant by Hire purchase and Instalment Purchase system and
state the differences between these two systems?
10. Explain various methods of calculation of goodwill.
11. Mr. Gopal purchased a machinery under Hire purchase system from M/s
Suguna & Co. on 01.01.2008. The cash price of the machinery was Rs.1,55,000.
The payment for the purchase is to be made as under. On signing the agreement
Rs.30,000, first year Rs.50,000, Second year end Rs.50,000, third year end
Rs.50,000. Make necessary ledger accounts in the books of both the parties
charging 10% depreciation on original cost method. Assume the books were
closing on Dec.31 every year.
12. From the following Receipts and Payments account, prepare final
accounts of adarsha Sports Club for the year ending 31st Dec. 2012.
Receipts
Rs
Payments
Rs
To Subscriptions
15,000 By Land
10,000
To Donations
50,000 By Buildings
40,000
To Legacies
10,000 By Furniture
10,000
To Entrance fees
5,000 By Sports materials
5,000
To Life members fees
3,000 By Sports Expenditure
6,000
To Sports income
17,000 By General Expenses
1,000

To Sundries
To Sale of old papers
14
1,500
4,000
28,000
1,05,500
1,05,500
Half of the donations, legacies, entrance fees and life membership fee is
to be capitalized. Subscriptions still outstanding is Rs.5,000. Depreciate buildings
and furniture by 5% and sports material by 10%.
13. The following was the Balance Sheet of A, B and C as on 1st June 2012 :
Liabilities
Rs
Assets
Rs
Bills Payable
3,300 Cash
600
Creditors
6,000 Debtors
10,800
Capitals :
Stock
11,400
A
16,800
Furniture
2,400
B
12,600
Buildings 19,500
C
6,000 35,400
44,700
44,700
They agreed to take X into partnership on the following terms.
a) X should bring the Rs.15,000 as capital and Rs.9,000 for goodwill.
b) Goodwill amount should not be left from the business.
c) Stock and furniture be depreciated by 10%
d) 5% reserve on debtors be created for doubtful debts.
e) The value of buildings should be raised to Rs.27,000
Prepare necessary accounts and show opening balance sheet.
14. Syam and Sundar are in partnership, sharing profits and losses in
proportion of 3/4th and 1/4th respectively.
Liabilities
Rs
Assets
Rs
Creditors
16,000 Cash at bank
1,000
Bills Payable
5,000 Debtors
9,000
General Reserve
4,000 Stock
12,000
Capital Accounts:
Investments
3,000
Syam
30,000 Furniture
15,000
Sundar
10,000 Buildings
25,000
65,000
65,00
They Agreed to admit Suresh into partnership giving him 1/4th share on the
following terms from 1st April, 2013.
a) Suresh should bring Rs.15,000 as his capital
b) Goodwill account be raised in the books at a value of Rs.12,000
c) The stock and furniture are to be depreciated by 10% and 5%
d) 5% reserve for doubtful debts be created on debtors.
e) The value of buildings be appreciated by 20%
f) Investments is to be revalued at Rs.3,500
Show necessary account and opening Balance Sheet.
5,000
500
By Magazines
By Ground expenses
By Balance c/d

Time : 3 Hours
1.
2.
3.
4.
(2009-10 Regulations) (NR)
71
Max. Marks : 70
PART A (5 6 = 30)
Answer any FIVE questions.
Differences between Single entry and Double entry system of Accounts. Explain.
Distinction between Receipts and Payments Account & Income and Expenditure
account.
Forefeiture of shares and surrender of shares. Explain.
Badrinath keeps his books by Single Entry System on 1-4-2004 his Financial
position was as follows :
Rs.
Rs.
Cash in hand
1,250 Cash at bank
2,000
Stock in trade
7,500 Fixtures
350
Sundry debtors
9,800 Plant
15,100
Sundry creditors
9,000 Drawings
5,900
On 31-03-2003 his financial position was as follows :
Rs.
Rs.
Sundry creditors
7,500 Plant
18,100
Fixtures
320 Debtors
13,300
Stock in trade
14,000 Cash in hand
1,150
Bank. O.D.
3,600
You are required to prepare statement of Profit and Loss and a closing statement
of affairs.
5. From the following details prepare Receipts and Payment account :

Rs.
Rs.
Opening cash in hand
500 Furniture purchased
2,000
Opening bank balance
4,800 Tournament Expenses
3,000
Subscription collected
11,000 Entertainment Expenses 1,500
Entrance fees received
1,000 Periodicals
1,200
Salary paid
3,000 Miscellaneous Expenses
300
Rent paid
1,200 Cash in hand at close
800
6. P and Q share profits and losses equally, but by agreement Q out of his share
pays 'P' a salary of Rs. 500 P.M. the accounts at 31st December 2002, show the
following results.
Capitals : P Rs.38,430
Q Rs.41,790
Net Profit before charging interest on capital Rs.23,505.
Drawings : P Rs.7,500
Q Rs.10,500
Paid by Q to 'P' in cash privately on account of salary : 3,000
After charging 5% Interest on capital write up the Capital account of each partner
at the year end.
7. On 1-1-2000 Venkat & Co. purchased a machine on instalment system Rs.6,000
payable on delivery and three annual instlaments of Rs.6, 400, Rs.8,900 and
Rs.8,800 the vendor Ramu Co. charge interest @ 10% p.a. Calculate cash price
of the machine.
8. Y. Ltd. issued 1,00,000 shres of Rs.10/- each at 8/ per share amounts payable are
Rs.2/- on application Rs.3/- on allotment and Rs.3/- on call show the Journal
entries.
SKU(AA2EM) MARCH 2010

Bills Payable
70
58,000 Debtors
(-) RBD
58,335 Bills Receivable
Furniture
(-) Depreciation
Buildings
(-) Depreciation
1,93,535
Capital fund
29,800
745
4,600
460
53,000
1,060
29,055
40,800
4,140
51,940
1,93,535
Statement of Profit/Loss for the year Ended 31-3-2004

Closing Capital Fund
58,335
(+) Drawings
6,000
64,335
(-) Capital fund
49,300
Profit
15,035
16. Working Notes:
Calculation of Assets Book value
Capital + Liabilities = Assets
Liabilities and Capitals
Creditors
60,000
Mrs. Haris Loan
25,000
Haris Capital
12,000
Giris Capital
16,000
Total
1,13,000
Assets Book Value = 1,13,000
Dr
To Assets
To Bank (Liabilites)
Realisation A/c
1,13,000 By Creditors
85,000 By Mrs. Haris Loan
By Bank (Assets realized)
By Loss:
Hari
Giri
1,98,000
Dr
Particulars
To Realisation A/c
To Bank
Dr
To Realisation A/c
To Haris Capital A/c
Capital Accounts
Hari
Giri
Particulars
16,200 10,800 By Balance b/d
--- 5,200 By Bank
16,200 16,000
Cr
60,000
25,000
86,000
16,200
10,800
27,000
1,98,000
Cr
Hari
Giri
12,000 16,000
4,200
--16,200 16,000
Bank A/c
86,000 By Realisation A/c
4,200 By Giris Capital A/c
90,200
Cr
85,000
5,200
90,200

SECOND YEAR EXAMINATIONS OCTOBER 2010
552 B1 : ADVANCED ACCOUNTING

15
15. P, Q and R partners sharing profits and losses equally. The balance sheet
at 31st Dec. 2012 is as follows.
Liabilities
Rs
Assets
Rs
Sundry Creditors
5,000 Cash at Bank
3,000
Reserve
6,000 R Current A/c
2,500
Current A/cs:
Bills Receivable
5,000
P
2,000 Sundry Debtors
20,000
Q
3,000 (-) Bad debts provision 1,000 19,000
Capital A/cs:
Stock
18,000
P
10,000 Fixtures
3,500
Q
15,000
R
10,000
51,000
51,000
R retires on the date and the following adjustments are to be made for the
purpose.
a) Goodwill is valued at Rs.12,000
b) Fixtures to be depreciated by 5%
c) Stock to be appreciated by 10%
d) Bad debts provisions to be increased by Rs.500
Find out the amount due to R and transfer it to his loan account. Prepare
necessary ledger accounts and opening Balance Sheet of continuing partners.
16. M Company Ltd has been incorporated with an authorized capital of
Rs.2,00,000 divided into 2000 equity shares of Rs.100 each. The company issued
1000 equity shares to the public payable at Rs.20 per share on application, Rs.25
on allotment, Rs.35 on first call and the balance on final call. All the money was
duly received for issued shares. Make journal entries to record the issue of shares
and show how share capital will appear in the balance sheet.
SRI KRISHNA DEVARAYA UNIVERSITY

II B.Com. Degree Examination, MARCH 2013
Paper II (552-B1) ADVANCED ACCOUNTING
Time : 3 Hrs
1.
2.
3.
4.
[Max : 70 Marks
Answer any FIVE of the following.
Difference between Hire purchase and installment purchases systems.

Receipts and Payments Account
Legal provisions in the absence of Partnership Deed.
Calculate the missing figure.
Rs
Capital at the end
20,400
Capital introduced during the year 5,000
Drawings
3,000
Loss
2,000
Capital in the beginning
?

16
5. Calculate the amount of stationery debited to Income and Expenditure
Account for the year 31.12.2012
Rs
500
300
Advance paid for stationery carried forward from 2011
100
Amount paid for stationery during the year 2012 2,200
350
750
Advance paid for stationery on 31.12.2012
250
6. A and B share profits and losses in 3:2 ratio. Their capital balances were
Rs. 30,000 and Rs.50,000 respectively. Salary was drawn by A and B Rs. 6,000
and Rs. 3,000 respectively. 6% Interest is payable on capital. Total profit for the
year was Rs. 31,000. In addition to salary A drew Rs. 2,000 and B Rs.13,500.
7. A, B and C are partners sharing profits in the ratio of 3:4:2. B retires and
the goodwill of the firm is valued at Rs. 16,200. No goodwill account appears in
the books of the firm. A and C decide to share profits in the ratio of 5:3. Give
Journal Entries to record the above. (with full narration).
8. Pass necessary Journal Entries at the time of issue and redemption, when
a debenture of Rs.100 is issued at Rs.98 on 1.4.2011 repayable at Rs.102 at the
end of 5 years.
Answer any Four question.
9. Mehta & Co. purchased a motor cycle on 1st January 2010 on Installment
system at a cash price of Rs. 7,450. The payment being Rs. 2,000 on signing the
agreement, balance in three equal installments of Rs. 2,000 each. Interest was
charged at 5% p.a. Depreciation written off @ 10% p.a. on reducing balance
method. Give necessary Ledger Accounts in the books of Mehta & Co.
10. The following is the Receipts and Payments Account of Hyderabad
Association for the year ended 31.12.2012
Receipts
Rs
Payments
Rs
To Balance on 1.1.2012
6,000 By Rent
28,800
To Entrance fees
11,000 By Stationery
5,740
To Subscriptions
By Wages
19,600
2011
4,000 By Billiard Tables
78,000
2012
1,70,000 By Repairs etc
10,820
2013 (Advance)
4,000 By Interest
12,400
To Locker rent
3,200 By Furniture
4,000
To Special Subscriptions for dinner 15,200 By Books
6,000
By Fixed deposits
20,000
By Dinner expenses
11,600
By (31.12.12) Balance
16,440
2,13,400
2,13,400
Lockers Rent Rs. 600 related to 2011 Rent has been paid in advance Rs.
4,800. Subscriptions due on 31.12.2012 Rs. 3,200.
69
(Being the interest received)

2) Profit & Loss Appropriation A/c
Interest A/c
To Sinking Fund A/c
(Being Sinking Fund was provided)
3) Bank A/c
To Sinking Fund Investments A/c
(Being the Investments sold)
4) Debenture A/c
To Bank
(Being the debentures Reduced)
Dr.
Date
Particulars
I
To Bank
II
To Balance b/d
To Bank
III
To Balance b/d
2,20,348.90
4,29,175
4,29,175
Dr
6,60,000
6,60,000
Sinking Fund A/c

Rs.
Date
Particulars
2,09,350
I
By Balance c/d
2,09,350
2,09,350 II By Balance c/d
2,19,825
4,29,175
4,29,175 III By bank
4,29,175
Dr.
Date
Particulars
I To Balance c/d
II
Dr 2,09,357.65
Dr 10,991.25
To Balance c/d
III To Reserve for Debentures
S. Fund A/c
Rs.
Date
Particulars
2,09,357.65 I By P & L App. A/c
2,09,357.65
4,29,182.80 II By Balance b/d
By P & L App. A/c
By Interest
4,29,182.80
6,49,531.70 III By Balance b/d
By Balance P & L App. a/c
By Interest
6,49,531.70
15.
Statement of affairs as on 1-4-2003
Liabilities
Rs.
Assets
Bank O.D.
45,000 Cash in hand
Bills payable
62,000 Stock
Creditors
38,600 Debtors
Capital fund
49,300 Bills Receivable
Furniture
Buildings
1,94,900
Rs.
5,350
59,350
30,200
42,400
4,600
53,000
1,94,900
Statement of affairs as on 31-3-2004

Rs.
Assets
40,000 Cash in hand
37,200 Stock
Rs.
5,400
62,200
Liabilities
Bank O.D.
Creditors
Cr
Rs.
2,09,350
2,09,350
4,29,175
4,29,175
4,29,175
4,29,175
Cr
Rs.
2,09,357.65
2,09,357.65
2,09,357.65
2,09,357.65
10,467.50
4,29,182.80
4,29,182.80
2,09,357.65
10,991.25
6,49,531.70
68
To Plant & Machinery

To Stock
To RBDD(25,0002.5/100)
Dr
Particulars
To Revaluation A/c
To Balance c/d
Liabilities
As Capital
Bs Capital
Cs Capital
Creditors
4,300 By Loss:
5,000
A
625
B
9,925
Capital A/cs
A
B
C
Particulars
5,955 3,970
--- By Balance b/d
52,045 38,030 20,000 By Cash
By Goodwill
58,000 42,000 20,000
5,955
3,970
9,925
Cr
A
B
C
40,000 30,000
------- 20,000
18,000 12,000
--58,000 42,000 20,000
Balance Sheet of A, B, & C

As at 31st December, 2002
Rs.
Assets
Rs.
52,045 Cash at Bank
22,000
38,030 Stock
35,000
20,000 Plant & Machinery
38,700
40,000 Debtors
25,000
(-) Provision for bad & doubtful debts 625 24,375
Goodwill
30,000
1,50,075
1,50,075
14.
Journal Entries
Date
Particulars
I Yr.
1) Bank A/c
To 6% Debentures A/c
(Being the debentures Issued)
To Sinking fund A/c
(Being the Sinking Fund was provided)
3) Sinking Fund Investments A/c
To Bank A/c
II Yr
1) Bank A/c
To Interest on Investments A/c
(Being the Interest Received)
Interest A/c
To Sinking Fund A/c
(Being Sinking Fund was provided)
3) Sinking Fund Investments A/c
To Bank A/c
III Yr.
1) Bank A/c
To Interest A/c (2,19,825 5/100)
Debit
Dr
Credit
6,00,000
6,00,000
Dr 2,09,357.65
2,09,357.65
Dr
2,09,350
2,09,350
Dr
10,467.50
10,467.50
Dr 2,09,357.65
Dr 10,467.50
2,19,825.15
Dr
2,19,825
2,19,825
Dr
10,991.25
10,991.25

17
Prepare an Income and Expenditure Account and Balance sheet as on 31.12.2012
11. Naresh and Suresh carrying on business sharing profits in the ratio of 3 :
2. Their balance sheet is given below.
Balance sheet
Liabilities
Rs
Assets
Rs
General reserve 15,000 Cash at bank
5,000
Creditors
30,000 Sundry debtors
5,000
Naresh capital
15,000 Stock
10,000
Suresh capital
10,000 Plant & Machinery 25,000
Buildings
25,000
70,000
70,000
They admit Prakash into business on the following conditions.
a) Stock and Plant were to be depreciated by 10%
b) Provide 5% Reserve for debtors.
c) Building was to be appreciated by 20%
d) Prakash was to be given one third share in profit and was to bring
Rs.12,500 as his capital and Rs.5,000 on his share of Good will.
Draft Jouranl Entries and Prepare the opening Balance sheet of the new
firm.
12. X, Y and Z were partners sharing profits in the ratio of 1 : 1 : 1
2 4 4
respectively Their balance sheet is given below.
Liabilities
Rs
Assets
Rs
Sundry creditors
40,000 Cash at Bank
4,000
Reserve fund
32,000 Debtors
45,600
Capital
Less provision
3,600
42,000
X
60,000 Stock
40,000
Y
40,000 Motor vehicle
20,000
Z
30,000 Plant and Machinery
60,000
Buildings
36,000
2,02,000
2,02,000
Y retires subject to the following conditions.
a) Goodwill of the firm to be valued at Rs. 40,000.
b) Plant to be depreciated by 10% and Motor vans by 20%
c) Increase Bad debts reserved by 2,000.
d) X and Z will share profits in future in the Ratio of 3/5 : 2/5.
Journalize the above and open the balance sheet.
13. A and B were in partnership and agreed to dissolve. The assets realised
Rs.80,000. The liabilities were as follows. Sundry creditors Rs.45,000, Loan from
A Rs.20,000; As capital Rs.10,000; Bs capital Rs.15,000. They shares profits and
losses in proportions A 3/5th and B 2/5th.
Show the means of ledger accounts how the cash realized should be
distributed.
14. Chandra Co. Ltd. Offered 1,00,000 Equity shares of the nominal value of
Rs.10 each for public subscription at Rs.12.

18
The amounts payable on the shares were on application Rs. 4.50 on
allotment (including premium) Rs. 4.50 on first and final call Rs. 3.00.
The actual subscription was only for Rs. 90,000 shares. All money payable
by share holders was received except from Sridhar who had taken 1,000 shares
but failed to pay the final call. His shares were forfeited.
Show Journal entries in the books of the company in respect of the above.
15. Discuss the features, advantages and disadvantages of single Entry
System
16. Explain the different methods of treating goodwill on admission of a
partner.
SOLUTIONS SKU (AA2EM) MARCH 2013

PART A
1. Difference between Hire purchase and installment purchases
systems.
Ans : Refer Q.no. 8 Page no. 6
2. Receipts and Payments Account
3. Legal provisions in the absence of Partnership Deed.
Ans : Refer Q.no. 3 in Oct 2011 Paper
4. Refer Q.no. 4 in March 2011 Paper.
5. Calculation of Amount debited to Income & Expenditure A/c
Rs
Amount paid for stationary in 2012
2,200
(+) Stock of stationary on 1.1.12
500
Prepaid in 2011
100
Creditor in 2012
750 1,350
3,550
(-) Creditors on 1.1.12
300
Stock of stationary on 31.12.12
350
Prepaid on 31.12.12
250 900
Amount debited to Income & Expenditure A/c
2,650
6.
Dr
Capital Account
Cr
Particulars
A
B
Particulars
A
B
To Drawings
2,000 13,500 By Balance b/d
30,000 50,000
To Balance c/d
54,400 53,900 By Interest on Capital
1,800 3,000
By P&L Appropriations A/c (salary) 6,000 3,000
By P&L Appropriation A/c 3:2 A/c 18,600 12,400
56,400 68,400
56,400 68,400
By Balance b/d
54,400 53,900
7.
Journal Entries
Date
Particulars
L.F. Debit Credit
Goodwill A/c
Dr
16,200

(-) Prepaid
To Advertisement
To Wages
To Other Expenses
67
100
400 By Profit on Sale of Furniture

2,000 By Other Receipts
8,000 By Excess of Exp. Over Income
1,000
31,800
Liabilities
Rs.
Assets
Outstanding Expenses
300 Cash Balance
Capital Fund
2,400 Furniture
Subscriptions
2,700
100
1,700
6,000
31,800
Rs.
1,500
200
1,000
2,700

Rs.
Assets
Rs.
2,400
Cash Balance
5,000
15,000
Investments
11,000
17,400
Outstanding Subscriptions 1,500
(-) Deficiency
6,000 11,400 Prepaid Insurance
100
Tournament Fund
2,000
(-) Tournament Exp.
1,500 500
2,500
Legacies (5,0001/2)
Subscriptions Received in Adv.
500
O/s Salaries
2,500
O/S Expenses
200
17,600
17,600
13.
Journal Entries
Dt.
Particulars
Debit Credit
Rs.
Rs.
Cash A/c
Dr
20,000
To C's Capital A/c
20,000
(Being new partner brings his share of capital)
Goodwill A/c
Dr
30,000
To As Capital A/c
18,000
To Bs Capital A/c
12,000
(Being the goodwill shared by old partners)
Revaluation A/c
Dr
9,300
To Stock
5,000
To Plant & Machinery
4,300
(Being depreciation in the value of Plant & Machinery and stock)
Revaluation A/c
625
To Reserve for bad debts A/c
625
(Being Reserve for bad debts debited to Revaluation A/c)
As Capital A/c
Dr
5,955
Bs Capital A/c
Dr
3,970
To Revaluation A/c
9,925
(Being loss on revaluation)
Liabilities
Capital Fund
Donation for buildings
Dr
Revaluation A/c
Cr

Particulars
I To Hire Vendor A/c
II To Balance b/d
III To Balance b/d
66
Rs.
Particulars
31,960 I By Depreciation A/c
By Balance c/d
31,960
28,764 II By Depreciation A/c
By Balance c/d
28,764
25,568 III By Depreciation A/c
By Balance c/d
25,568
Hire Vendor A/c
Rs.
8,000 I By Machinery A/c
12,000
By Interest A/c
13,158
(23,9605/100)
33,158
10,000 II By Balance b/d
3,816
By Interest A/c
13,816
4,000 III By Balance b/d
By Interest A/c(Bal.Fig.)
4,000
I To Bank A/c
To Bank A/c
To Balance c/d
II To Bank A/c
To Balance c/d
III To Bank A/c
Rs.
3,196
28,764
31,960
3,196
25,568
28,764
3,196
22,372
25,568
Rs.
31,960
1,198
33,158
13,158
658
13,816
3,816
184
4,000
Particulars
I To Hire Vendor A/c
Interest A/c
Rs.
Particulars
1,198 I By Profit & Loss A/c
Rs.
1,198
II To Hire Vendor A/c
658 II By Profit & Loss A/c
658
III To Hire Vendor A/c
184 III By Profit & Loss A/c

Depreciation A/c
Rs.
3,196 I By Profit & Loss A/c
184
Rs.
3,196
Year
I
To Machinery
II
To machinery
3,196 II By Profit & Loss A/c
3,196
III
To Machinery
3,196 III By Profit & Loss A/c
3,196
12.
Dr.
Expenditure
To Salaries
(+) Outstanding
To Office Expenses
(-) Last year expenses
(+) Outstanding
To Printing & Stationary
To Insurance
Income & Expenditure A/c as on 31-12-2002

Rs.
Income
12,000
By Subscriptions
2,500 14,500 (+) Last year subscriptions
3,500
300
(+) Outstanding
3,200
200 3,400 (-) Received in Advance
2,500 By Legacies (5,0001/2 )
500
By Sales Magazines
Cr.
Rs.
21,000
1,000
20,000
1,500
21,500
500 21,000
2,500
500

19
5,400
To A Capital A/c 16,2003/9
7,200
To B Capital A/c 16,2004/9
3,600
To C Capital A/c 16,2002/9
(Being good will created)
10,635
A Capital A/c (16,20021/32)
Dr
5,569
C Capital A/c (16,20011/32)
Dr
To Good will A/c
16,200
(Being good will written off in gaining ratio)
Note: At the time of retirement of a Partner, the continuing partners may gain
something. So goodwill must be adjusted in gaining Ratio.
Gaining Ratio = New Share old Share
5 3 45 - 24 21
A= - =
=
8 9
72
72
3 2 22 - 16 11
=
B= - =
8 9
72
72
Going Ratio = 21 : 11
8.
Journal Entries
Date
Particulars
L.F. Debit Credit
Bank A/c
Dr
98
Discount on issue of Debenture A/c
Dr
2
Loss on issue of Debentures A/c
Dr
2
To Debentures A/c
100
To Premium on redemption of Debentures A/c
2
(Being Debentures are issued at Rs.2 Discount & repayable at Rs.2 Premium
Debentures A/c
Dr
100
Premium on redemption of Debentures A/c
Dr
2
To Bank A/c
102
(Being debenture are redeemed)
PART B
9.
Analytical Table
No. of Installments Cash price Interest Principle Installment (Rs)
7,450
1.1.10 Down payment
2,000
2,000
2,000
5,450
31.12.10
1,727
273
1,727
2,000
3,723
31.12.11
1,814
186
1,814
2,000
1,909
31.12.12
1,909
91
1,909
2,000
550
7,450
8,000
Calculation of Depreciations
Motor cycle value on 1.1.10
7,450

(-) Depreciation for 2010
Value on 1.1.11
Value on 1.1.12
Motor cycle value
Dr
Date
Particulars
1.1.10 To Vendor Ltd

Motor Cycle A/c

Rs
Date
7,450 31.12.10
"
7,450
6,705 31.12.11
"
6,705
6,034 31.12.12
"
6,034
5,431
20
745
6,705
671
6,034
603
5,431
Particulars
By Depreciation
By Balance c/d
By Depreciation
By Balance c/d
By Depreciation
By Balance c/d
Dr
Interest Suspense A/c
Date
Particulars
Rs
Date
Particulars
1.1.10 To Vendor A/c
"
By Balance c/d
550
"
By Balance c/d
277
91
Dr
Date
Particulars
1.1.10 To Bank A/c
31.12.10 To Bank A/c
31.12.10 To Balance c/d

31.12.11 To Balance c/d
Dr
10.
Vendor A/c
Rs Date
Particulars
2,000 1.1.10 By Motorcycle A/c
2,000 1.1.10 By Interest suspense A/c
4,000
8,000
2,000 1.1.11 By Balance b/d
2,000
4,000
2,000
Income & Expenditure Account of Hyderabad Association

for the year ending 31.12.12

1.1.00 To Bank
31.12.00 To Bank (2,000+300)
To Balance c/d
31.12.01 To Bank (2,000+200)
To Balance c/d
Cr
Rs
745
6,705
7,450
671
6,034
6,705
603
5,431
6,034
Cr
Rs
273
277
550
186
91
277
91
91
Cr
Rs
7,450
550
8,000
4,000
4,000
2,000
2,000
Cr
31.12.02 To Bank (2,000+100)
65
4,000
2,300
4,000
10,300
2,200
2,000
4,200
2,100
2,100
1.1.00 By Machinery A/c

31.12.00 By Interest (6,0005/100)
1.1.01 By Balance b/d
31.12.01 By Interest A/c
1.1.02 By Balance b/d
31.12.02 By Interest A/c
10,000
300
10,300
4,000
200
4,200
2,000
100
2,100
6.
Calculation of Subscriptions for the year 2007
Subscriptions Received
5,200
(-) Received for the year 2000
200
5,000
(+) Outstanding for 2001
5,500
10,500
(+) Received in 2000 for 2001
200
10,700
(-) Received in Advance
100
10,600
7.
Balance Sheet of P. Ltd.
Liabilities
Rs.
Assets Rs.
Authorized Capital:
25,000 Shares of Rs. 100 each
25,00,000
Issued, Subscribed capital :
25,000 Shares of Rs. 100 each
25,00,000
(-) Called and paid up share capital :
25,000 shares of Rs. 100 each
25,00,000
1,00,000 24,00,000
8.
Profit & Loss Appropriation A/c
To Invest on Capitals :
By Balance b/d 9,200
2,000
Aswini (20,00010/100)
1,500
Bharani (1500010/100)
1,000
Kartik (10,00010/100
To Salary to Kartik
2,000
To Profit :
Aswini
1,200
Bharani
900
Kartik
600 2,700
9,200
9,200
PART B
9. Distinction between Receipts and Payments Accounts and Income and
Expenditure Account.
10. What are the conditions for issue of shares at discount and premium?
Ans: Refer QNo.112, 113, Page 57, 58 Respectively.
11.
Machinery Account
64
14. A company issued 6% debentures of 6,00,000 with a condition that they should be
redeemed after three years at 10% premium. The amount set aside for redemption is
invested in 5% Government debentures, the sinking fund table shows that 0.31720856 at
5% in three years will become Re. 1.
You are required to give Journal entries for three years.
15. A trader has not kept proper books of account. Prepare a statement of profit and
loss for the year ended 31st March 2004 and a statement of affairs as that date from the
following balances:
1-4-2003
31-3-2004
Particulars
Rs.
Rs.
Cash in hand
5,350
5,400
Bank overdraft
45,000
40,000
Stock in trade
59,350
62,200
Creditors
38,600
37,200
Debtors
30,200
29,800
Bills Receivable
42,400
40,800
Bills Payable
62,000
58,000
Furniture
4,600
4,600
Buildings
53,000
53,000
Drawing during the year amounted to Rs. 6,000. Depreciation is to be calculated
on buildings at 2% and on a furniture at 10%. Provide for doubtful debts 2 %.
16. Hari and Giri were in partnership and agreed to dissolve. The assets realized Rs.
86,000 the liabilities were as follows. Sundry creditors Rs. 60,000, Loan from Mrs. Hari Rs.
25,000, Haris capital Rs. 12,000. Giris capital Rs. 16,000 they share profits and losses in
proportions Hari 3/5 and Giri 2/5.
Show by means of ledger accounts how the cash realized should be distributed on
dissolution of the firm?
SOLUTIONS SKU (AAEM) MARCH 2010

PART A
1. Ascertainment of profit under Statement of Affairs Method Explain.
2. Define distinctions between hire-purchase and instalment buying.
3. Explain Partnership Deed Meaning and its contents.
4.
Computation of Profit
Capital at the end
67,500
(+) Drawings
7,500
75,000
(-) Capital at the beginning 60,000
15,000
(-) Additional Capital
3,750
Net Profit
11,250
5.
Dr
Kusum's A/c
Date
Particulars
Rs.
Date
Particulars
Cr
Rs.

21
Expenditure
Rs
Income
Rs
To Rent
28,800
By Subscriptions
1,70,000
(-) Prepaid
4,800 24,000 (+) outstanding
3,200 1,73,200
To stationary
5,740 By Surplus for dinner
15,200
To Wages
19,600 By Lockers Rent
3,200
To Repairs
10,820 (-) Last year
600
2,600
To Interest
12,400
To Dinner Expenses
11,600
To Surplus
1,06,840
1,91,000
1,91,000
Liabilities
Rs
Assets
Rs
Capital fund
10,600 Cash
6,000
O/s subscription
4,000
O/s Lockers Rent
600
10,600
10,600
Liabilities
Rs
Assets
Rs
Capital fund
10,600
Cash
16,440
(+) surplus
1,06,840 1,17,440 Billiard Table
78,000
Entrance fee
11,000 Furniture
4,000
Pre-received
Books
6,000
subscriptions
4,000 Fixed deposits
20,000
Prepaid Rent
4,800
Subscriptions outstanding
3,200
1,32,440
1,32,440
11.
Journal Entries
Date
Particulars
L.F Debit Credit
General Reserve A/c
Dr
15,000
To Naresh Capital A/c
9,000
To Suresh Capital A/c
6,000
(Being Reserve distributed among old partners)
P&L Adjustment A/c
Dr
3,750
1,000
To Stock A/c (10,00010/100)
2,500
To Plant A/c (25,00010/100)
250
To Reserve for Bad debts (5,0005/100)
(Being decrease in Assets recorded)
5,000
Dr
Building A/c (25,00020/100)
To P&L Adjustment A/c
5,000
(Being increase in Buildings recorded)
P&L Adjustment A/c
Dr
1,250
750
To Suresh capital A/c
500
(Being Profit or revaluation distributed)

Cash A/c
Dr
To Prakash Capital A/c
To Goodwill A/c
(Being Capital brought by new partner)
Good will A/c
Dr
To Suresh Capital A/c
(Being goodwill distributed)
Dr
Particulars
To stock
To Plant
To Reserve for Bad debts
To Profit
Naresh (1,2503/5)
Suresh (1,2502/5)
22
17,500
5,000
3,000
2,000
P&L Adjustment A/c

Rs
Particulars
1,000 By Buildings
2,500
250
750
500
1,250
5,000
Capital A/c
Particulars Naresh Suresh Prakash
Particulars
To Balance c/d 27,750 18,500 12,500 By Balance b/d
By Reserve
By goodwill
By P&L Adjustment
By Bank
27,750 18,500 12,500
By Balance b/d
Particulars
To Balance b/d
To Prakash Capital
To goodwill
To Balance b/d
Dr
Date
Particulars
To Naresh Capital
To Suresh Capital
Liabilities
Cr
Rs
5,000
5,000
Dr
Dr
12,500
5,000
Naresh
15,000
9,000
3,000
750
--27,750
27,750
Suresh
10,000
6,000
2,000
500
--18,500
18,500
Cash A/c
Rs
Particulars
5,000 By Balance c/d
12,500
5,000
22,500
22,500
Goodwill A/c
Rs
Date
Particulars
3,000
By Cash
2,000
5,000
Balance sheet
Rs
Assets
Cr
Prakash
--------12,500
12,500
12,500
Cr
Rs
22,500
22,500
Cr
Rs
5,000
5,000
Rs
63
Answer any FOUR questions.

9. Distinction between Receipts and Payments Accounts and Income and
Expenditure Account.
10. What are the conditions for issue of shares at discount and premium?
11. X purchased a machine on hire purchased system. Total cash price of the machine
is Rs. 31,960 payable Rs. 8,000 down and three instalments of Rs. 12,000, Rs. 10,000 and
Rs. 4,000 payable at the end of the first, second and third year respectively. Interest is
charged at 5% p.a.. Charge depreciation at 10% on straightline method. Prepare Ledger
Accounts in the books of X.
12. Prepare Income and Expenditure A/c from the Receipts and Payments A/c on 3112-2002.
Receipts
Rs.
Payments
Rs.
To Balance
1,500 By Salaries
12,000
To Subscriptions
21,000 By Office Expenses
3,500
To Donation for
BY Printing and Stationery 2,500
construction of building 15,000 By Insurance
500
To Tournament Fund
2,000 By Advertisement
2,000
To Legacies
5,000 BY Investments
11,000
To Sale of Magazines
500 By Tournment Expenses 1,500
To Sale of furniture
By Wages
8,000
(Original value of Rs. 200) 300 By Other Expenses
1,000
To Other receipts
1,700 By Balance
5,000
47,000
47,000
Additional information :
i) Rs. 1,000 in subscription in related to the year 1999, and Rs. 1,500 is outstanding
for this year.
ii) Subscription received in advance Rs. 500 are also included.
iii) Capitalize half of the legacies.
iv) Outstanding salaries Rs. 2,500, Insurance prepaid Rs. 100.
v) Office Expenses include Rs. 300 of the last year outstanding Rs. 200 for the year.
Prepare Income and Expenditure A/c.
13. A and B are partners in a firm sharing profit and losses 60% and 40%
respectively. Their Balances Sheet as on 31-12-2002 was as follows :
Liabilities
Rs.
Assets
Rs.
Creditors
40,000 Cash at Bank
2,000
Capitals A
40,000 Debtors
25,000
B
30,000 Stock
40,000
Plant and Machinery
43,000
1,10,000
1,10,000
The partners agree to take C as partner on the following terms :
a) That C will pay Rs. 20,000 as capital for 40% of future profits of the firm.
b) That assets are to be revalued before his admission. The stock be reduced to Rs.
35,000 and plant and machinery be depreciated by 10%.
c) That a provision of 2 % be created against debtors.
d) As the new partner is unable to pay anything for goodwill a goodwill account be
raised in the books of the firm for Rs. 30,000.
Pass Journal Entries to record the above transactions and prepare the Resultant
Balance Sheet.

Share final call A/c
Dr
(Being share final call money due on 20,000 shares of Rs. 2.50 each)
Cash A/c
Dr
To share final call A/c (50,000 2,500)
(Being share final call money received on 1,49,000 shares of Rs. 2.50 each)
62
50,000
50,000
47,500
47,500

SECOND YEAR EXAMINATIONS MARCH 2010
552 B1 : ADVANCED ACCOUNTING
Time : 3 Hours
(2009-10 Regulations) (NR)
Max. Marks : 70
PART A (5 6 = 30)
1. Ascertainment of profit under Statement of Affairs Method Explain.
2. Define distinctions between hire-purchase and instalment buying.
3. Explain Partnership Deed Meaning and its contents.
4. Find out the profit from the following data :
Capital at the beginning for the year
60,000
Drawings during the year
7,500
Capital at the end of the year
67,500
Additional capital introduced during the year
3,750
5. On 1st January 2002, Dass purchased a machine from Kumaran on hire-purchase
basis the particulars are as follows :
i) Cash price Rs. 10,000.
ii) Rs. 4,000 to be paid on signing the contract.
iii) Balance in three instalment of Rs. 2,000 plus interest.
iv) Interest charged on outstanding balance at 5%.
v) Depreciation at 10% p.a. on written down value method.
Prepare Kumaran account in the books of purchaser.
6. From the following information relating to hospital for 2001 find out the amount of
subscriptions to be credited to Income and Expenditure Account and the amount to be
placed on the Balance Sheet.
Subscriptions received in 2001 Rs. 5,200 of which Rs. 200 rates to the year 2000
position of subscriptions as on
31-12-2000 31-12-2001
Rs.
Rs.
Subscriptions receivable
1,000
5,500
Subscriptions received in advance
200
100
7. P Ltd. has an authorized capital of 25,000 shares of Rs. 100 each the company
issued all the shares which was fully subscribed expect on 5000 shares at Rs. 20 each was
in calls in arrears.
Show the details in the Balance Sheet.
8. Aswini, Bharani and Kartik were partners sharing profits and losses 4 : 3 : 2 with
share capitals Rs. 20,000, Rs. 15,000 and Rs. 10,000 the profits for the just concluded year
amounted to Rs. 9,200 before allowing interest on capitals. (Which is to be calculated at
10%) and Kartik salary Rs. 2,000. Prepare the Profit and Loss Adjustment Account.
PART B (410 = 40)

Creditors
30,000 Cash at Bank
(5,000+12,500+5,000)
Capital
Debtors
Naresh
27,750
(-) Reserve
Suresh
18,500
Stock
Prakash
12,500 58,750 (-) Decrease
Plant & Machinery
(-) Depreciation
Building
(+) Appreciation
88,750
12.
Journal Entries
Date
Particulars
L.F.
P&L Adjustment A/c
Dr
To Plant (60,00010/100)
To Motor vehicle (20,00020/100)
To RBD
(Being the Assets value decreased)
X Capital A/c
Dr
Y Capital A/c
Dr
Z Capital A/c
Dr
To P&L Adjustment A/c
(Being Loss on revaluation of Assets shared)
Good will A/c
Dr
To Y Capital A/
(Being Y Share of goodwill credited)
X Capital A/c
Dr
Z Capital A/c
Dr
To Good will A/c
(Being goodwill written off by old partners)
Dr
Particulars
To Plant
To Motor Van
To R.B.D
P&L Adjustment A/c

Rs
Particulars
6,000 By Loss :
4,000
X (12,0002/4)
2,000
Y (12,0001/4)
Z (12,0001/4)
12,000
Dr
Particulars
To P & L Adjustment A/c
To Y loan A/c
23
22,500
5,000
250 4,750
10,000
1,000 9,000
25,000
2,500 22,500
25,000
5,000 30,000
88,750
Debit
12,000
6,000
3,000
3,000
10,000
6,000
4,000
Credit
6,000
4,000
2,000
12,000
10,000
10,000
Cr
Rs
6,000
3,000
3,000
Y Capital A/c
Rs
Particulars
3,000 By Balance b/d
55,000 By Reserve
By goodwill
12,000
12,000
Cr
Rs
40,000
8,000
10,000
24
58,000
58,000
Dr
X, Z
X
6,000
6,000
64,000
76,000
Particulars
To goodwill
To P & L Adjustment A/c
To Balance b/d
Liabilities
Sundry Creditors
Capitals
X
Z
Y Loan A/c
64,000
31,000
Capital A/c
Cr
Z
Particulars
X
Z
4,000 By Balance b/d 60,000 30,000
3,000 By Reserve
16,000
8,000
31,000
38,000
76,000 38,000
By Balance b/d 64,000 31,000
Balance sheet
Rs
Assets
Rs
40,000 Cash at bank
4,000
Debtors
42,000
(-) RBD
2,000
40,000
95,000 Stock
40,000
55,000 Motor Vehicle
20,000
(-) Depreciation
4,000
16,000
Plant & Machinery 60,000
(-) Depreciation
6,000
54,000
Buildings
36,000
1,90,000
1,90,000
13.
Working Note : Calculation of Assets book value. (assets = Capital + liabilities)
Balance sheet
Liabilities
Rs
Assets
Rs
Creditors
45,000 Assets (B/F) 90,000
Loan From A 20,000
As Capital
10,000
Bs Capital
15,000
90,000
90,000
Dr
Particulars
To Sundry Assets
To Bank (creditors)
Dr
Particulars
To Realization A/c
Realization A/c
Rs
Particulars
90,000 By Creditors
45,000 By Bank
(Assets realized)
By Loss : A
B
1,35,000
A,B Capital Accounts
A
B
Particulars
6,000
Cr
Rs
45,000
6,000
4,000
A
10,000
80,000
10,000
1,35,000
Cr
B
15,000
61
Creditors
Loan from A
As Capital
Bs Capital
45,000
20,000
10,000
15,000
Total
90,000
Assets Book Value = 90,000
Dr
Particulars
To Assets
To Bank (Liabilities)
Dr
Particulars
To Realisation A/c
To Bank
Dr
Particulars
To Realisation A/c
Realization A/c
Rs.
Particulars
90,000 By Creditors
By As Loan
65,000 By Bank (Assets realized)
By Loss:
A (10,0003/5)
B (10,0002/5)
1,55,000
Cr
Rs.
45,000
20,000
80,000
6,000
4,000
Capital Accounts
A
B
Particulars
6,000
4,000 11,000
10,000 15,000
Bank A/c
Rs.
Particulars
80,000 By Realisation A/c
By As Capital A/c
By Bs Capital A/c
80,000
16.
Journal Entries in the books of X Ltd.
Date
Particulars
Cash A/c
To share application A/c (20,000 2)
(Being share application money received on 20,000 shares of Rs. 20,000)
(Being the application money transferred to capital A/c.)
Share allotment A/c
Discount on issue of shares A/c
(Being the allotment money due on 20,000 shares of Rs. 2 each and a discount of Rs.1 each)
Cash A/c
To share allotment A/c
(Being share allotment money received)
Share first call A/c
(Being share first call money due on 20,000 shares of Rs.2.50 each)
Cash A/c
To share first call A/c
(Being share first call money received)
10,000
1,55,000
A
10,000
Cr
B
15,000
10,000
15,000
Cr
Rs.
65,000
4,000
11,000
80,000
Dr
Dr
LF Debit Credit
40,000
40,000
40,000
40,000
Dr
Dr
40,000
20,000
60,000
Dr
40,000
40,000
Dr
50,000
50,000
Dr
50,000
50,000

(-) Drawings
Trade Creditors
60
1,01,000
22,400
Bank balance
78,600 Prepaid Insurance
32,000
2,08,400
30,000
800
2,08,400
Particulars
To Stock (10,00020/100)
To. R.B.D.(20,0005/100)
To Profit
C (7,0005/8)
D (7,0003/8)
Dr
Particulars
To Balance c/d
Dr
Particulars
To Balance c/d
Dr
Particulars
To Balance b/d
To Es Capital A/c
To Good will A/c
Liabilities
Creditors
Capitals:
C
D
E
Profit & Loss Adjustment A/c

Rs.
Particulars
2,000 By Plant (50,00020/100)
1,000
4,375
2,625
7,000
10,000
Capital Accounts
C
D
Particulars
66,875 36,125 By Balance b/d
By Reserve fund
By Profit
By Good will
66,875 36,125
E's Capital A/c

Rs.
Particulars
12,875 By Cash (66,875+36,125)1/8
12,875
Cash (Bank) A/c
Rs.
Particulars
12,875
16,000
31,275
Balance Sheet of New firm
Rs.
Assets
10,000 Bank
Debtors
20,000
66,875 (-) R.B.D.
1,000
36,125 Stock
10,000
12,875 (-) Decreased
2,000
Investments
Plant
50,000
(+) Appreciation 10,000
1,25,875
15. Working Notes:

Calculation of Assets Book Value
Capital + Liabilities = Assets
Liabilities and Capitals
Cr
Rs.
10,000
10,000
C
40,000
12,500
4,375
10,000
66,875
Cr
D
20,000
7,500
2,625
6,000
36,125
Cr
Rs.
12,875
12,875
Cr
Rs.
31,275
31,275
Rs.
31,275
19,000
8,000
7,600
60,000
1,25,875
25
10,000
15,000
Dr
14.
Dr

To Bank
4,000 11,000
10,000 15,000
Bank A/c
Cr
Rs
Particulars
Rs
80,000 By Realization A/c (Creditor)
45,000
By As Loan A/c
20,000
By A Capital A/c
4,000
By B Capital A/c
11,000
80,000
80,000
14.
Journal Entries in the books of Chandra co.
Date
Particulars
L.F. Debit Credit
4,05,000
Dr
Bank A/c (90,0004.50)
4,05,000
(Being share Application money received)
Share Application A/c
Dr
4,05,000
4,05,000
(Being Share application money transferred to share capital)
4,05,000
Dr
Share Allotment A/c (90,0004.50)
2,25,000
To Share Capital A/c (90,0002.50)
1,80,000
To Share Premium A/c (90,0002)
(Being Share allotment due)
Bank A/c
Dr
4,05,000
4,05,000
2,70,000
Dr
Share final call A/c (90,0003)
To Share Capital
2,70,000
(Being Share final call due)
Bank A/c (2,70,000-3000)
Dr
2,67,000
To Share final Call
2,67,000
(Being Final call money received on 89,000 shares)
10,000
Dr
Share capital A/c (100010)
3,000
To Share final Call 1,0003
7,000
To Share forfeiture 10007
(Being 1000shares are forfeiture)
Particulars
To Realization A/c
15. Discuss the features, advantages and disadvantages of single Entry

System
16. Explain the different method of treating goodwill on admission of a partner.
Ans : Refer Q.no. 20 Page no. 17.
SKU(AA2EM) NOV./DEC. 2013
26

II B.COM., DEGREE EXAMINATION, NOV./DEC. 2013
Part-II: COMMERCE
Paper VI (552-B1): ADVANCED ACCOUNTING

Time : 3 Hrs]
(w.e.f. 2009-10)

To Depreciation on:
Buildings (1,64,700 5/100)
Books (28,60020/100)
To Surplus
[Max : 70 Marks
1. Difference between statement of affairs and balance sheet.
2. Income and expenditure account.
3. Sacrificing ratio.
4.. On 1st January 2012 XYZ & Co took delivery from ABC Co. Ltd of a
machine on hire-purchase system Rs.1,500 being paid on delivery and the
balance in five installments of Rs.3,000 each. Payable annually on 31st December.
The cash price of the machine was Rs.15,000. Calculate the amount of Interest for
each year.
5.. On the basis of the following information ascertain the subscriptions
actually received in 2012.
Rs.
Subscriptions as per income and expenditure account for 2012
5,000
Subscription received in advance on 31.12.2012
2,000
Subscription outstanding on 31.12.2012
8,0000
Subscription in arrears on 1.1.2012
4,000
6.. A and B are partners sharing profits and losses in the ratio of 3 : 2. C was
admitted on 1/5th share profit. Calculate the new profit sharing ratio.
7.. A, B and C are partners sharing profits and losses in the ratio of 4 : 3 : 2. B
retrieves from the business. A and C decide to share profits in the ratio of 17:10.
Calculate gaining ratio.
8.. Mahesh was holding 100 shares of Rs.100 each Rs.80 per share called
up. He paid Rs.30 on applications but failed to pay Rs.20 on allotment and Rs.30
on first call. His shares were forfeited. Journalize the above transaction forfeiture.
Answer any FOUR questions.
9.. A trader his books by single entry method.
1-1-2012 31-12-2012
Rs.
Rs.
Cash in hand
535
540
Bank overdraft
4,500
4,000
Stock in trade
5,935
6,220
Sundry creditors
3,860
3,720
Sundry debtors
3,020
2,980
Bills receivable
4,240
4,080
Land and buildings
5,300
5,300
Furniture and fittings
460
460
Bills payable
6,200
5,800
59
8,235
5,750
95,625
1,89,100
1,89,100

Liabilities
Rs.
Assets
Capital fund 2,51,200
Cash
(+) surplus 95,625 3,46,825 Furniture
Land & buildings 1,64,700
(-) Depreciation
8,235
Library books
28,600
(-) Depreciation
5,720
Equipment
Investments
3,46,825
Rs.
1,22,000
35,000
1,56,465
22,880
480
10,000
3,46,825
13.
Dr
Trading and Profit & Loss A/c of A and B for the year ending 31-07-05
Cr
Particulars
Rs.
Particulars
Rs.
To opening stock
25,600 By Sales
4,11,200
To purchases
3,04,000
(--) Returns
12,800 3,98,400
(-) Returns
14,400 2,89,600 By Closing Stock
28,800
To carriage inwards
8,000
To Gross Profit
1,04,000
4,27,200
4,27,200
To Salaries
14,400 By Gross Profit
1,04,000
To Rates
6,400 By Discount
4,480
To carriage outwards
2,000
To Discount allowed
5,600
To Insurance
4,000
(-) Pre paid
800
3,200
To Dep. on Plant & Machinery
2,880
To Profit
A (74,0001/2)
B (74,0001/2)
Laibilities
Capital Accounts:
A
(+) Profit
37,000
37,000
1,08,480
1,08,480

Rs.
Assets
80,000
Plant & Machinery
37,000
(-) Depreciation
1,17,000
Lease hold premises
(-) Drawings
19,200 97,800 Trade debtors
B
64,000
(-) R.B.D.
(+) Share of Profit 37,000
Closing Stock
Rs.
28,800
2,880
25,920
96,000
28,000
1,120 26,880
28,800
Date
Jan. 1
Jan. 1
Dec 31.
Dec 31.
Dec 31.
Dec 31.
12.
Dr

11,200
Value on 1-1-06
44,800
(-) Depreciation for 2006 (44,800 20/100) 8,960
Value on 1-1-07
35,840
(-) Depreciation for 2007 (35,840 20/100) 7,168
Truck Value
28,672
Journal Entries
2005
2006
Transaction
Dr
Cr
Dr
Cr
Trucks A/c
Dr 50,000
To vendor A/c.
50,000
(Being the trucks purchased on hire purchase system)
Vendor A/c.
Dr 15,000
To cash A/c.
15,000
(Being the down payment made)
Trucks A/c.
Dr 12,950
13,597
Interest A/c.
Dr 2,050
1,403
To Vendor A/c.
15,000
15,000
(Being the instalment amount due)
Vendor A/c.
Dr 15,000
15,000
To cash A/c.
15,000
15,000
(Being the amount paid)
Depreciation A/c.
Dr 11,200
8,960
To Trucks A/c.
11,200
8,960
(Being the depreciation was provided)
Profit & Loss A/c.
Dr 13,250
10,363
To Interest A/c.
2,050
1,403
To Depreciation A/c.
11,200
8,960
(Being the interest and depreciation transfer to P & C A/c)
Liabilities
Rs.
Assets
Rs.
Capital fund 2,51,200 Cash Balance
20,000
Furniture
35,000
Land & Buildings 1,60,000
Books
24,000
Investments
10,000
O/S Tuition fees
2,200
2,51,200
2,51,200
Income & Expenditure A/c for the year ending 31-03-2010

Expenditure
Rs.
Income
To Salaries
70,500 By tuition fee (59,000-2,200)
To P.F contribution
5,540 By fines
To Printing
700 By Grant from Govt.
To Postage
500 By Interest on Securities
To News Papers
300 By Rent of hall
To Audit Fee
800
To Repairs
600
To General Expenses
580
58
2007
Dr
Cr
14,453
547
15,000
15,000
15,000
7,168
7,168
7,715
547
7,168
Cr
Rs.
56,800
1,000
1,30,000
300
1,000

27
Drawings during the year amounted to Rs.6,000. Depreciation is to be
calculated on hand and buildings at 2% and furniture and fittings at 10%. Provide
for doubtful debts at 2 21 percent. Calculate profit for the year.
10.. From the following information prepare an income and expenditure

account and the balance sheet.
Receipts
Rs.
Payments
Rs.
Cash in hand
1,400 Salaries
48,000
Cash at bank
16,000 Stationary and postage
2,000
Subscriptions :
Cycle purchased
3,000
2011
5,000
Rent
5,000
2012
83,000
Investments
30,000
2013
6,000
94,000 Help to needy students
20,000
Sale of investments
20,000 Cash in hand
3,000
Interest on investments
600 Cash at bank
24,000
Sale of furniture
3,000
(Book value Rs.4,000)
1,35,000
1,35,000
Subscriptions for 2012 still due was Rs.7,000
Interest due on investments was Rs.1,000
Rent still owing was Rs.600
The book value of investments sold was Rs.18,000
On 31-12-2012 the value of investments still in hand was Rs.12,000
On 1-1-2012 the value of furniture was Rs.9,000.
11.. A, B and C are partners in a firm with capitals of Rs.40,000; Rs.24,000 and
Rs.20,000 respectively on 1.1.2012. Partnership deed contains the following
clauses.
a) Interest on capital @ 5% p.a.
b) Interest on drawings @ 4% p.a.
c) A to get a salary @ Rs.400 per month
d) B and C to get 10% commission each on the net profit (before the above
adjustments)
e) Profits and losses to be shared:
i) Up to Rs.4,500 in the ratio of 4:3:2, ii) Above Rs.4,500 equally.
The net profit of the firm for the year 2012 amounted to Rs.20,500 and the
drawings of the partners are: A Rs.2,400; B Rs.1,600 and C Rs.1,600.
Prepare the profit and loss Appropriation A/c and capital. Accounts of the
partners assuming capitals are fluctuating.
12.. The following in the balance sheet of A and B as at 31-12-2012:
Liabilities
Rs.
Assets
Rs.
Creditors
40,000 Cash at bank
20,000
Capital :
Sundry assets 1,10,000
A
50,000
B
40,000
1,30,000
1,30,000

28
The partners shared profits and losses in the ratio of 3:2 on the above
date C was admitted as a partner on the condition that he would pay Rs.40,000 as
capital. Goodwill was to be valued at 3 years purchase of the average of four
years profits which were :
2009 Rs.18,000
2011 Rs.24,000
2010 Rs.28,000
2012 Rs.26,000
The new profit sharing ratio is 7:5:4.
Give journal entries and balance sheet if goodwill is brought in cash and
withdrawn from the business.
13.. On 30th June 2012 X and Y, sharing profits in the ratio of 3:2 decide to
dissolve the partnership. Their balance sheet on that date showed as follows:
Rs.
Rs.
Creditors
30,000 Cash at bank
6,000
Reserve
10,000 Sundry debtors 25,000
1,000
24,000
Current accounts
() provisions
X
3,000
Investments
10,000
Y
3,000
6,000 Stock
60,000
Capital accounts
Furniture
6,0000
X
40,000
Y
20,000
60,000
1,06,000
1,06,000
X agrees to discharge the liabilities and takes over the bank balance. He
also takes over the book debts at Rs.20,000. Y takes over the stock at Rs.64,000.
Furniture at Rs.4,800 and investments at Rs.17,000. Y is allowed to carry on the
trade in the old firms name on his taking over the goodwill at Rs.20,000. Show
realization account and capital accounts of the partners.
14.. A company issued 1,00,000 ordinary shares of Rs.10 each at Rs.13 per
share payable at Rs.6 on application (including premium) Rs.3 on allotment and
the balance on first and final call.
Applications for 1,20,000 shares were received of the cash received
Rs.80,000 was returned and the excess of the application money was utilized in
part payment of the allotment money.
One applicant to whom 100 shares had been allotted failed to pay the
amount due on call and his shares were forfeited. Show the journal entries.
15. What is Hire purchase system? Explain its features and repossession of
the asset.
16. Write note on:
a) Fixed capital system
b) Fluctuating capital system
c) Profit and loss appropriation account d) Sacrificing ratio.

II B.Com DEGREE EXAMINATION, MARCH 2012.
PAPER VI(552-B1) : ADVANCE ACCOUNTING

B (17,200 2/5)
6,880 17,200
31,000
Journal Entries
Particulars
57
31,000
7.
Date
LF Debit Credit
(a) Cash A/c
Dr
20,000
To Good will A/c
20,000
(Being Goodwill brought by D)
(b) Good will A/c
Dr
20,000
To A capital A/c
10,000
To B capital A/c
6,000
To Capital A/c
1,000
(Being good will distributed to old partners)
As Capital A/c
Dr
10,000
Ds Capital A/c
Dr
6,000
Cs Capital A/c
Dr
4,000
To Cash A/c
20,000
(Being good will with drawn by the old partners)
8.
Journal Entries
Date
Particulars
LF Debit Credit
1-4-04 Band A/c
Dr
98
Discount on issue of Debentures A/c.
2
Loss on Issue of Debentures A/c.
Dr
2
To Debentures A/c.
100
To Redemption premium A/c.
2
(Being the debenture issued at discount, but repayable at premium)
1-4-09 Debenture A/c.
Dr
100
Redemption premium A/c.
Dr
2
To Bank A/c.
102
(Being the debenture Redeemed)
PART B
9. Distinguish between Balance Sheet and Statement of Affairs.
10. Explain the treatment of goodwill when a partner is admitte.
11.
Analytical Table
No. of
Cash price Interest Principle Instalment
Installments
Amount
56,000
1-1-05 (Down)
15,000
-15,000
15,000
41,000
31-12-05
12,950 2,050
12,950
15,000
28,050
31-12-06
13,597 1,403
13,597
15,000
14,453
31-12-07
14,453
547
14,453
15,000
-- 4,000
56,000
60,000
Calculation of Depreciation:
Trucks value on 1-1-2005
56,000
56

Time : 3 Hrs]
SOLUTIONS SKU(AA2EM) - OCTOBER 2011

PART - A
1. Features of Hire purchase system.
Ans: Refer Q. No. 11, Page No. 9.
2. Discuss the characteristic features of income and expenditure account.
Ans: Refer Q.No. 83, Page No. 49.
3. Narrate the legal Provisions in Partnership Act applicable to accounts in
the absence of agreement.
Ans: Generally the partners make a written or oral agreement at the time of entering into
partnership regarding the name of the firm, the nature of Business, Capital, Drawings and
Interest on capital etc. In the absence of an agreement, the following rules will be
applicable.
a) profits or losses of the firm will be shared equally by the partners
b) Partners are not entitled for any interest on capital similarly, no interest will be
charged on drawing of the partners.
c) No partner is entitled for any salary or remuneration.
d) If any partner has given a loan to the firm, in addition to capital he will be allowed
6% interest on such loan.
e) Every partner must take part in the management of business.
4.
Calculation of Profit
Particulars
Rs.
Closing capital
90,000
(+) Drawings during the year
18,000
1,08,000
(-) capital introduced during the year
5,000
1,03,000
(-) Opening Capital
80,000
Profit
23,000
5.
Rs.
Subscriptions received in 2005
18,000
(-) Subscription for the year 2004
4,000
14,000
(-) Subscriptions for the year 2006
3,000
11,000
(+) Outstanding subscription for 2005
2,500
Subscriptions to be credited to income & expenditure 13,500
6.
Particulars
Rs.
Particulars
Rs.
To Interest on capital:
By Balance b/d 31,000
1,800
A (30,000 6/100)
3,000 4,800
B (50,000 6/100)
To salary to A
6,000
To salary to B
3,000
To profit:
10,320
A (17,200 3/5)
1.
2.
3.
4.
29
[Max. Marks : 70
Limitations of single entry system.
Features of Receipts and Payments A/c
Contents in partnership deed.
Calculate the missing figure:
Rs.
Capital at the end
20,400
Capital introduced
5,000
Drawings
3,000
Loss
2,000
Capital at the beginning
?
5. Calculate the amount to be debited to income and expenditure a/c.

Rs.
Stock of stationery 1.1.2010
4,000
Creditors for stationery 1.1.2010
3,000
Amount paid for stationery
15,000
1,500
Stock of stationery 31st Dec 2010
6. Ravi, Kavi are partners sharing profits in the ratio of 5 3. They admit Guru on 3/7
share which he takes 2/7 from Ravi. 1/7 from Kavi. Calculate new profit sharing ratio.
7. A, B, C are partners in a firm sharing profits in the ratio of 2 1 1. B retires from
the business. What will the new profit sharing ratio?
8. Rama Rao having 30 shares each Rs. 10. He paid Rs. 2 on application, Rs. 3 on
allotment. But he did not paid 1st call Rs. 3. These shares were forfeited. Write entries in the
books of company.
9. Lakshmi purchased a machine on hire purchase system from Tata Motors Ltd. on
1st April 2010. Cash price of the machine was Rs. 68,000. Pay were.
Rs.
Rs.
End of 1st year 12,000 End of 2nd Year 18,000
End of 3rd Year 17,000 End of 4th Year 16,000
End of 5th Year 15,000
All payments were made according Prepare:
a) Tata Motors Ltd. account
b) Machinery A/c in the books of Laxmi providing depreciation @ 10% on reducing
balance method.
10. Prepare Income and Expenditure account with the following information for the
year 2009.
Receipts
Rs.
Rs.
Payments
Rs.
To Balance b/d
15,000 By Salaries
15,000
To Subscriptions :
By Entertainment
6,000
2008
1,000
By Electricity
2,000
2009
20,000
By General Expenses
3,000
2010
2,000 23,000 By Investment
10,000
To Entertainments
10,000 By Stationery
2,000
To Sale of old Newspapers
400 By Newspapers
5,000

To Sale of old furniture
(Original cost Rs. 1,000)
30
600
By Furniture
By Balance c/d
3,000
3,000
49,000
49,000
Club had 2500 members. Each member pays Rs. 10 per annum. Rs. 100 salaries
paid for the year 2008.
11. Define Goodwill. Explain the treatment of goodwill as per AS 10.
12. Following is the Balance Sheet of A and B who share profits and losses in the ratio
of 3 2.
Particulars
Rs.
Particulars
Rs.
General Reserve
30,000 Bank
5,000
Creditors
60,000 Debtors
10,000
Capital :
Stock
20,000
A
30,000 Plant and Machinery
55,000
B
20,000 Buildings
50,000
1,40,000
1,40,000
They agreed to admit Srinivas into business :
a) Srinivas has to bring Rs. 25,000 as capital and Rs. 10,000 as goodwill for his 1/3
share.
b) Stock and Plant be reduced by 10%
c) Provide 5% for doubtful debts.
d) Buildings was to be appreciated by 20%.
Show the opening balance sheet of new firm.
13. Following is the Balance Sheet of A, B and C who share profits in their capitals.
Liabilities
Rs.
Assets
Rs.
Creditors
30,000 Cash at bank 13,000
General Reserve 10,000 Debtors
35,000
Capitals :
Stock
15,000
A
20,000 Machinery
25,000
B
15,000 Fixtures
2,000
C
15,000
90,000
90,000
On that date, C retires from the firm and for this purpose. The goodwill of the firm is
valued Rs. 18,000. Stock has been revalued Rs. 20,000. Machinery Rs. 15,000. Fixtures
Rs. 10,000. Reserve for bad debts Rs. 3,000. Show the balance sheet.
14. X Ltd, issued 25000 equity shares of 10 each at a discount of 10% payable as
follows:
On Application Rs. 2; On First Call Rs. 2.50; On Allotment Rs. 2: On Final Call Rs.
2.50.
Applications were received for 20000 shares and all of these were accepted. All
money due was received except the final call of 1000 shares. Write journal entries and
prepare the balance sheet.
15. Differentiate between single entry system and double entry system.
16. Discuss the legal provision in the absence of partnership deed.
SOLUTIONS SKU (AA2EM) - MARCH 2012

PART A
1. Limitations of Single Entry system.
Ans : Refer QNo. 2, Page 1
55
Trial Balance on 30 June, 2005.

Debit balance
Rs.
Credit Balance
Rs
Purchases
3,04,00 Capital:
Plant and Machinery 28,800 A
80,000
Opening stock
25,600 B
64,000
Salaries
14,400 Provision for Bad Depth 1,120
Leasehold premises
96,000 Returns outward
14,400
Carriage outwards
2,000 Sales
4,11,200
Bank Balance
30,000 Trade creditors
32,000
Trade debtors
28,000 Discount
4,480
Carriage inwards
8,000
Discount allowed
5,600
Returns inward
12,800
Insurance
4,000
Drawings : A
19,200
B
22,400
Rates
6,400
6,07,200
6,07,200
You are required to prepare final accounts after taking into the following.
a) Closing stock Rs. 28,800
b) Plant and Machinery is to be depreciated by 10%
c) Insurance paid in advance Rs. 800.
14. C and D carrying on partnership business sharing profits in the ratio of 5 : 3
Balance Sheet
Liabilities
Rs.
Assets
Rs.
Creditors
10,000 Bank
2,400
Reserve Fund 20,000 Debtors
20,000
Capitals: C
40,000 Stock
10,000
D
20,000 Investments
7,600
Plant
50,000
90,000
90,000
They admit E into business for 1/8 share on the following:
a) Stock to be depreciated by 20%
b) A provision of 5% created for doubtful debts.
c) Plant is to be appreciated by 20%
d) E brought 16,000 as his share of goodwill
e) E brings capital to the extent of 1/8 of the combined capital of the partners after
the above adjustment.
Show ledger A/cs and opening balance sheet of the new firm.
15. A and B were in partnership and agreed to dissolve. The assets realized
Rs.80,000, The liabilities were as follows : Sundry creditors Rs.45,000 loan from A
Rs.20,000. As capital Rs.10,000, Bs capital Rs.15,000. They share profit and losses in
3:2 ratio. Show ledger accounts.
16. X Ltd. Issued 25,000 equity shares of 10 each at a discount of 10% payable as
follows:
On Application Rs. 2
On first call Rs. 2.50
On Allotment Rs. 2
On final call Rs. 2.50
Applications were received for 20,000 shares and all of these were accepted. All
money due was received except the final call on 1000 shares. Pass necessary Journal
Entries.
54
Subscriptions of 2004 received in 2005 4,000

Subscriptions of 2006 received in 2005 3,000
Outstanding subscriptions of 2005
2,500
6. A and B share profits and losses in 3:2. Their capital balances were Rs. 30,000
and Rs. 50,000 respectively. Salary was drawn by A and B Rs. 6,000 and Rs. 3,000
respectively. 6% interest is payable on capital. Total profits for the year was Rs. 31,000 in
addition to salary A drew Rs.2,000 and Rs. 13,500.
Show Profit and Loss Appropriation Account.
7. A, B, C are partners carrying business in the ratio of 5:3:2. They admit D into
business by giving him 1/5 share in future profits. He brings Rs. 20,000 as his share of
goodwill.
The old partners withdrew goodwill from business. Pass Journal Entries.
8. Pass necessary Journal Entries at the time of issue and redemption, when a
debenture of Rs. 100 is issued at Rs. 98 on 1.4.2004 and repayable at Rs. 102 at the end
of 5 years.
PART B (410 = 40 Marks)
9. Distinguish between Balance Sheet and Statement of Affairs.
10. Explain the treatment of goodwill when a partner is admitte.
11. A Motor Company purchased two trucks on 1.1.2005, the cash price being
Rs.56,000. The purchase is on hire purchase basis. Rs.15,000 being paid on signing the
agreement and thereafter Rs. 15,000 being paid annually for 3 years interest was charged
at 5%. Depreciation was written off at the rate of 20% p.a on the reducing installment
system. Give the necessary ledger accounts in the books of Motor Company.
12. Receipts and Payments Account of an welfare Association for the year 31 March,
2010 is given below:
Rs.
Rs.
Balance on 1.4.2009
20,000 Salary and Allowances 70,500
Tuition fees
59,000 PF contribution
5,540
Fines
1,000 Printing
700
Grant from State Govt. 1,30,000 Books
4,600
Interest on securities
300 Postage
500
Rent from hall
1,000 News papers
300
Equipment
480
Audit fees
800
Building
4,700
Repairs
60
General Expenses
580
Cash balance
1,22,000
2,11,300
2,11,300
Additional information:
The Association had the following assets on 31.3.2009 : furniture 35,000. Land
and Building Rs.1,60,000, Library books Rs.24,000 investments Rs.10,000: Outstanding
Tution fees Rs.2,200.
Provide depreciation on closing balances of the following Assets land and
Buildings 5% and library books at 20%.
Prepare final Accounts for the year 2010.
13. A and B sharing profits and losses equally in a partnership firm carried on them.
31
2. Features of Receipts and Payments A/c

Ans : Refer to QNo. 84, Page 49
3. Contents in partnership deed.
Ans : Refer to QNo. 16, Page 13
4.
Calculation of Opening Capital
Rs.
Capital at the end 20,400
(+) Drawings
3,000
23,400
(-) Additional Capital
5,000
18,400
(+) Loss
2,000
Opening Capital
20,400
5.
Calculation of Stationery Consumed
Rs.
Stock of Stationery on 1.1.10
(+) Amount paid for stationery
(-)
Stock Stationery on 31.12.10

Stationary consumed
1,500
3,000
Rs.
4,000
15,000
19,000
4,500
14,500
6.
Ravi, Kavis old ratio = 5 3
3
Share given to Guru =
7
Guru acquires 2/7th from Ravi and 1/7th from Kavi
So New ratio = Old Ratio acquired by Guru
5 2 35 16 19
Ravi New Ratio =
8 7
56
56
3 1 21 8 13
Kavi New Ratio =
8 7
56
56
3 8 24
Guru =
7 8 56
New Ratio = 19 13 24
7.
Old Ratio of ABC =
2 1 1
: :
4 4 4
B retires from the firm so New Ratio of A C =

8.
Date
2 1
:
3 3
Journal Entries
Particulars
Bank A/c (302)

To Share application a/c
Dr.
Debit
60
Credit
60
9.
32
(Being application money received)

Dr.
To Share capital a/c
Share allotment A/c (303)
Dr.
(Being share allotment due)
Bank a/c
Dr.
To Share allotment a/c
(Being Share allotment money received)
Share first call a/c (303)
Dr.
(Being Share first call due)
Share Capital a/c (308)
Dr.
To Calls in arrears (303)
To Forfeited shares (305)
(Being 30 shares are forfeited)
PART B
60
()
Paid at the end of 2nd Year
()
Paid at the end of 3rd Year
()
Paid at the end of 4th Year
()
Paid at the end of 5th Year
90
90
90
90
90
Interest in 1st Installment (10,000 78/238) =

Interest in 2nd Installment (10,000 66/238) =
Interest in 3rd Installment (10,000 48/238) =
Interest in 4th Installment (10,000 31/238) =
Interest in 1st Installment (10,000 15/238) =
Dr
Date
Particulars
1 Yr To Tata Motors a/c
240
90
150
Dr
Date
Dr
Date
53
Rs
Assets
Rs
30,000 Cash at bank
13,000
Debtors (35,000-3,000)
32,000
Stock
20,000
54,600 Machinery (25,000-10,000) 15,000
23,400 Fixtures
10,000
Goodwill
18,000
1,08,000
1,08,000
Depreciation Redemption Fund A/c

Particulars
Rs
Date
Particulars
To Debenture fund investment A/c
500
By Balance b/d
To General Reserve A/c
1,58,050
By Bank A/c
(1,51,0005/100)
1,58,550
Particulars
To Bank A/c
Particulars
To Bank A/c
Cr
Rs
1,51,000
7,550
1,58,550
Depreciation fund Investment A/c

Rs
Date
Particulars
1,51,000
By Bank A/c
By Sinking fund A/c
1,51,000
Cr
Rs
1,50,500
500
1,51,500
5% Debentures A/c
Rs
Date
Particulars
1,50,000
By Balance b/d
1,50,000
Cr
Rs
1,50,000
1,50,000

II B.Com. DEGREE EXAMINATION OCTOBER 2011
PAPER - VI(552B1) : ADVANCED ACCOUNTING

Time : 3 Hours
Rs.
3,277
2,773
2,017
1,302
631
Machinery A/c
Rs.
Date
Particulars
68,000 1 Yr By Depreciation a/c
By Balance c/d
16.
Dr
Date
90
Rs.
78,000
12,000
66,000
18,000
48,000
17,000
31,000
16,000
15,000
15,000
0
Ratio = 78,000 66,000 48,000 31,000 15,000

= 78 66 48 31 15
Liabilities
Creditors
Capitals
X
31,200
Y
23,400
Zs loan a/c
60
Calculation of Interest
Interest = Installment Amount Cash Price
= 78,000 68,000 = 10,000
Calculation of Ratio
Total Installment Amount
() Paid at the end of 1st Year
Cr
Rs.
6,800
61,200
(2009-10 Regulation)
[Max. : 70 Marks
PART A (5 6=30 Marks)

Answer Any FIVE Questions
1. Features of Hire purchase system.
2. Discuss the characteristic features of income and expenditure account.
3. Narrate the legal Provisions in Partnership Act applicable to accounts in the
absence of agreement.
4. Find out profit from the following data:
Rs.
Capital at the beginning of the year 80,000
Drawings during the year
18,000
Capital at the end of the year
90,000
Capital introduced during the year 5,000
5. Ascertain the amount of subscriptions to be credited to income and Expenditure
Account for the year 31.12.2005.
Rs.
Subscriptions received in 2005
18,000
52
14,000
14,000
2 Yr To Balance b/d
Dr
Particulars
To Balance c/d
Capital Accounts
A
B
C
D
Particulars
63,000 36,000 18,000 8,000 By Balance b/d
By Profit
By Goodwill
By Cash
63,000 36,000 18,000 8,000
Dr
Liabilities
Creditors
Capitals
A
63,000
B
36,000
C
18,000
D
8,000
Balance sheet of the New firm

Rs
Assets
5,000 Land & Buildings
Machinery (7,000 - 840)
Stock (29,000 - 2,900)
Debtors (25,200 1,260)
Cash
1,25,000
1,30,000
15.
Particulars
To Zs Loan A/c
X
31,200
31,200
Capital Accounts
Y
Particulars
By General Reserve
By Goodwill
23,400
Balance sheet of the New firm
3 Yr To Balance b/d
4 Yr To Balance b/d
5 Yr To Balance b/d
6
11,800
Rs
62,000
6,160
26,100
23,940
11,800
Dr
Date
Particulars
1 Yr To Cash A/c
To Balance c/d
3 Yr To Cash A/c
To Balance c/d
Cr
Rs
5,000
8,000
13,000
Cr
Rs
15,000
3,000
5,400
23,400
X
20,000
4,000
7,200
31,200
To Balance b/d
2 Yr To Cash A/c
To Balance c/d
1,30,000
Zs Capital A/c
Rs
Particulars
By General Reserve (10,0003/10)
By Goodwill (18,0003/10)
23,400
Dr
Particulars
To Balance c/d
Cr
Rs
11,800

Rs
Particulars
10,000 By Stock
3,000 By Fixture
13,000
Particulars
To Machinery
To R.B.D
Dr
A
B
C
D
57,000 32,000 16,000
--4,500 3,000 1,500
--1,500 1,000
500
--------- 8,000
63,000 36,000 18,000 8,000
Cash A/c
Rs
Particulars
800 By Balance c/d
8,000
3,000
11,800
Particulars
To Balance b/d
To Ds capital A/c
To Goodwill
Dr
Cr
Cr
Y
15,000
3,000
5,400
23,400
4 Yr To Cash A/c
To Balance c/d
5 Yr To Cash A/c
10.
Dr
33
68,000
61,200 2 Yr
61,200
55,080 3 Yr
55,080
49,572 4 Yr
49,572
44,615 5 Yr
44,615
40,153
By Depreciation a/c
By Balance c/d
By Depreciation a/c
By Balance c/d
By Depreciation a/c
By Balance c/d
By Depreciation
By Balance c/d
Tata Motor's A/c

Rs.
Date
Particulars
12,000 1 Yr By Machinery a/c
59,277
By Interest A/c
71,277
18,000 2 Yr By Balance b/d
44,050
By Interest A/c
62,050
29,067
By Interest A/c
46,067
14,369
By Interest A/c
30,369
By Interest A/c
15,000
Income & Expenditure A/c for the Year ending 31.12.09

Expenditure
Rs.
Rs.
Income
To Salaries
15,000
By Subscriptions
20,000
100 14,900 (+) Outstanding
5,000
() Paid for 08
To Entertainment expenses
6,000 By Entertainment receipts
To Electricity
2,000 By Sale of news papers
To General Expenses
3,000
To Stationery
2,000
To News Papers
5,000
To loss on sale of furniture
400
(1000 600)
To Excess of Income over
Expenditure
2,100
35,400
68,000
6,120
55,080
61,200
5,080
49,572
55,080
4,957
44,615
49,572
4,462
40,153
44,615
Cr
Rs.
68,000
3,277
71,277
59,277
2,773
62,050
44,050
2,017
46,067
29,067
1302
30,369
14,369
631
15,000
Cr
Rs.
25,000
10,000
400
35,400
34

Particulars
Capital fund
11. Define Goodwill. Explain the treatment of goodwill as per AS 10.
Ans : Goodwill may be defined as the good name or reputation of an existing

business. The goodwill of the business attracts more customers and there fore
results in earning more profits. Goodwill of a firm enables it to earn profit in excess
of the profits earned by other firms in the same type of business. The excess
earnings are called super profits. Goodwill really arises only if a firm is able to earn
super profits.
AS-10 Treatment of goodwill
para 16 of the accounting standard 10 states that goodwill can be
recorded in the books only when some consideration in money or money's worth
has been paid for it. Therefore only purchased goodwill should be recorded in the
books.
In case of admission/ retirement / death of a partner or in case of change
in profit sharing ration among partners goodwill cannot be raised in the books of
the firm as no consideration in money or moneys worth is paid for it.
If any partner brings only premiums (goodwill) over and above his capital
contribution at the time of his admission such premium should be distributed to the
other existing partners. when no payment is made for the purchase of goodwill
and good will account is raised in the books, it is a case of internally generated
goodwill or inherent goodwill and as per accounting standard 10 it is not
permitted. As a matter of financial prudence where goodwill account exists at the
time of reconstitution of a firm, it should be written off over a period of time.
In case of retirement of a partner, the continuing partners will gain in terms
of profits sharing ration. There fore they have to give to the retiring partner his
shave of goodwill.
12.
Dr
Particulars
To Stock (20,00010/100)
To Plant (55,00010/100)
To Reserve for doubtful debts
To A Capital a/c
To B Capital a/c
Cr
Rs.
10,000
Dr
13.
Cash A/c
Particulars
To Balance c/d
Cr
Particulars
To Drawings
To Interest
To Balance c/d
Dr
A
8,000
480
15,260
23,740
Particulars
To Machinery
To Reseve for Bad debts
To Stock
To Profit
A
B
C
Cr
Rs
50,000
480
600
18,940
18,940 37,880
51,080
A
80,000
80,000
14.
Rs
8,220
39,000
2,000
3,000
10,000
2,400
1,600
66,220
Profit & Loss Application

Rs
Particulars
By interest on Drawings
4,800
A (8,0006/100)
2,400 7,200
B (10,0006/100)
Particulars
To Bs Salary (50012)
To Interest on capitals
A (80,0006/100)
B (40,0006/100)
To Profit
A
B
Dr
10,000
Rs
3,000
2,000
300
5,300
Balance Sheet As on 31-12-2005

Particulars
Rs
Particulars
Capital fund
5,300
Cash Balance
(+) Surplus
58,920 64,220 Billiards table
Subscriptions Received in advance
2,000 Furniture
Books
Fixed Deposit
Prepaid rent
Subscription due
66,220
Dr
Revaluation A/c
Rs. Rs.
Particulars
2,000 By Buildings (50,00020/100)
5,500
500
1200
800 2,000
10,000
Dr
ABC Capital A/cs
Cr
Particulars
A
B
Srinivas
Particulars
A
B
Srinivas
To Balance c/d 5 5,200 36,800 25,000 By Balance b/d
30,000 20,000
-By General Reserve 18,000 12,000
-By Goodwill
6,000 4,000
-By Cash
-- - 25,000
By Revaluation
1200
800
-55,200 36,800 25,200
55,200 36,800 25,000
Dr
51
Rs
Particulars
5,300 Cash Balance
Subscriptions
Locker Rent due
5,300
51,080
Capital Accounts
B
Particulars
40,000 By Cash
40,000
A
80,000
80,000
Current Accounts
B
Particulars
10,000 By Salary
600 By Interest on capitals
16,740 By Profits
23,740
Rs
Particulars
840 By Land & Buildings
1,260
2,900
4,500
3,000
1,500
1,080
9,000
--4,800
18,940
23,740
Cr
B
40,000
40,000
Cr
B
6,000
2,400
18,940
23,740
Cr
Rs
14,000

31.12.02 To Cash (4000+480)
To Balance c/d
31.12.03 To Cash
To Balance c/d
31.12.04 To Cash
Dr
Date
31.12.00
Particulars
To Vendor A/c
31.12.01
To Vendor A/c
31.12.02
To Vendor A/c
31.12.03
To Vendor A/c
31.12.04
To Vendor A/c
Dr
Date
31.12.00
Particulars
To Machinery
31.12.01
To Machinery
31.12.02
To Machinery
31.12.03
To Machinery
31.12.04
To Machinery
50
16,640
8,000 31.12.02 By Interest
12,480
4,000 31.12.03 By Interest
8,320
31.12.04 By Interest
4,160
Interest A/c
Rs
Date
800 31.12.00
800
640 31.12.02
640
480 31.12.02
480
320 31.12.03
320
160 31.12.04
160
Depreciation A/c
Rs
Date
2,500 31.12.00
2,500
2,500 31.12.01
2,500
2,500 31.12.02
2,500
2,500 31.12.03
2,500
2,500 31.12.04
2,500
Particulars
By P&L A/c
By P&L A/c
By P&L A/c
By P&L A/c
By P&L A/c
16,640
12,000
480
12,480
8,000
320
8,320
4,000
160
4,160
Cr
Rs
800
800
640
640
480
480
320
320
160
160
Cr
Particulars
By P&L A/c
By P&L A/c
By P&L A/c
By P&L A/c
By P&L A/C
Rs
2,500
2,500
2,500
2,500
2,500
2,500
2,500
2,500
2,500
2,500
12.
Dr
Expenditure
To Rent
(-) Pre Paid Rent
To Stationery
To Wages
To Repairs
To Interest
To Dinner Expenses
To Surplus
Income & Expenditure A/c

Rs
Income
14,400
By Entrance fee
2,400
12,000 By Subscriptions
2,870 (+) Due
9,800 By Locker Rent
5,410 (-) Due For 2004
6,200 By subscriptions for dinner
5,800
58,920
1,01,000
Cr
Rs
5,500
85,000
1,600
1,600
300
86,600
1,300
7,600
1,01,000

Particulars
To Balance b/d
To Srinivas Capital a/c
To Goodwill
Dr
Particulars
To A Capital A/c
To B Capital A/c
Liabilities
Creditors
Capital
A
B
Srinivas
35
Rs.
Particulars
5,000
10,000
40,000
Goodwill A/c
Rs.
Particulars
6,000 By Cash A/c
4,000
10,000
A, B and Srinivas Balance Sheet
Amt.
Assets
60,000 Bank
Debtors
10,000
55,200 () Reserve
500
36,800 Stock
20,000
25,000 () Depreciation
2,000
Plant
55,000
5,500
() Depreciation
Buildings
50,000
(+) Appreciation 10,000
1,77,000
13.
Dr
Particulars
To Machinery (25,00015,000)
To Reserve for Bad debt
Revaluation A/c
Rs.
Particulars
10,000 By Stock (20,00015,000)
3,000 By Fixtures (10,0002,000)
13,000
Rs.
40,000
40,000
Cr
Rs.
10,000
10,000
Amt.
40,000
9,500
18,000
49,500
60,000
1,77,000
Cr
Rs.
5,000
8,000
13,000
Capital A/cs
Cr
Dr
Particulars
A
B
C
Particulars
A
B
C
To C Loan a/c
-- - 23,400 By Balance b/d
20,000 15,000 15,000
To Balance c/d 31,200 23,400
- - By General Reserve 4,000 3,000 3,000
By Goodwill
7,200 5,400 5,400
31,200 23,400 23,400
31,200 23,400 23,400
A & B Balance Sheet
Liabilities
Amt.
Assets
Amt.
Creditors
30,000 Cash at Bank
13,000
C Loan a/c
23,400 Debtors
35,000
Capital
3,000
32,000
() Reserve
A
31,200 Stock (15,000 + 5,000)
20,000
B
23,400 Machinery (25,000 10,0000)
15,000
Fixtures (2,000 + 8,000)
10,000
Goodwill
18,000
1,08,000
1,08,000
14.
Journal Entries in the books of X Ltd.

Date
36
Particulars
Bank A/c
Dr.
To Equity Share application a/c
(Being share application money received)
Equity Share application A/c
Dr.
To Equity Share capital a/c
Equity Share allotment a/c
Dr.
Discount on Issue of Shares A/c
Dr
Bank a/c
Dr.
To Equity Share allotment a/c
(Being Share allotment money received)
Equity Share first call a/c
Dr.
To Equity Share capital a/c
(Being Share first call money due)
Bank a/c
Dr.
To Equity Share first call a/c
(Being Share first call share money received)
Equity Share final call a/c
Dr.
To Equity Share Capital a/c
(Being share final call money due)
Bank a/c
Dr.
To Equity Share Final call a/c
(Being Share final call money received on 19,000 shares)
Liabilities
Authorized Capital
Issued Capital, 25,000
Shares Rs. 10 each
Subscribe Capital
Called up capital
(-) Calls in Arrears
Debit
40,000
Credit
40,000
40,000
40,000
20,000
40,000
60,000
40,000
40,000
50,000
50,000
50,000
50,000
50,000
50,000
47,500
Balance Sheet of X Ltd.

Rs.
Assets
-- Bank A/c
Discount on Issue of shares
2,50,000
2,00,000
2,00,000
2,500 1,97,500
1,97,500
47,500
Rs.
1,77,500
20,000
1,97,500
Ans : Refer to Q. 3, Page 2
16. Discuss the legal provision in the absence of partnership deed.

Ans :In the absence of an agreement, the following rules will be applicable.
1) Profits or losses of the firm will be shared equally by the partners.
2) Partners are not entitled for any interest on capital, similarly, no interest
will be charged on drawings of the partners.
3) No Partner in entitled for any salary or remuneration.
4) If any partner has given a loan to the firm, in addition to capital he will be
allowed 6% interest on such loan
49
9. Differentiate between Hire purchase system and instalment purchase system.

10. Explain the procedure to be followed in case of admission of a partner.
11.
Analytical Table
No. of
Cash
Instalment
Instalment
Price Interest Principle
Rs
25,000
Down (1.1.00)
5,000
--5,000
5,000
20,000
31.12.00
4,000
800
4,000
4,800
16,000
31.12.01
4,000
640
4,000
4,640
12,000
31.12.02
4,000
480
4,000
4,480
8,000
31.12.03
4,000
320
4,000
4,320
4,000
31.12.04
4,000
160
4,000
4,160
2,400
25,000
27,400
Annul Deprecation = 25,00010/100=2,500
Dr
Machinery A/c
Cr
Date
Particulars
Rs
Date
Particulars
Rs
2,500
By Balance c/d
22,500
25,000
25,000
2,500
By Balance c/d
20,000
22,500
22,500
2,500
By Balance c/d
17,500
20,000
20,000
2,500
By Balance c/d
15,000
17,500
17,500
2,500
By Balance c/d
12,500
15,000
15,000
12,500
Dr
Date
Particulars
1.1.00 To Cash
31.12.00 To Cash (4000+800)
To Balance c/d
31.12.01 To Cash (4000+640)

To Balance c/d
Vendors A/c
Rs
Date
5,000 1.1.00
4,800 31.12.00
16,000
25,800
4,640 1.1.01
12,000 31.12.01
Particulars
By Machinery
By Interest
Cr
Rs
25,000
800
By Balance b/d
By Interest
25,800
16,000
640

A
B
C
48
1,200
900
600
2,700
9,200
7. Goining Ratio = New Ratio Old Ratio

4 2
New Ratio = 4:2 = :
6 6
4 3 2
Old Ratio = : :
9 9 9
4 4 12 8 4
Xs gaining Ratio
6 9
18
18
2 2 64 2
Zs gaining Ratio
6 9
18
18
Gaining Ratio
4
2
2
1
X
or , Y or
18
9
18
9
8.
Journal Entries in the Book of XYZ co.
Date
Particulars
Bank A/c
To Share application A/c
(Being the application money received on shares)
(Being the application money transfer to capital)
Share allotment A/c
(Being the allotment money due on 9000 share of
Rs.5 each as per resolution)
Bank A/c
To Share allotment A/c
(Being the allotment money received)
Share calls
(Being the calls Money due on 9000 share of Rs.3
each as per the resolution)
Bank A/c
To Share calls A/c
(Being the calls money received)
Dr
Particulars
To Share Call A/c
9,200

5) Every partner must take part in the management of the business.
37

II B.Com DEGREE EXAMINATION, SEPTEMBER 2012
Paper V (552-B1): ADVANCED ACCOUNTING

Time : 3Hrs]
Debit Credit
Dr 18,000
18,000
Dr 18,000
18,000
Dr 45,000
45,000
Dr 45,000
Dr 27,000
45,000
27,000
Dr 27,000
Cash (Bank) A/c

Rs
Particulars
45,000
27,000
90,000
PART B
27,000
Cr
Rs
90,000
90,000
(w.e.f 2009-10)
[Max. Marks : 70
Answer any FIVE questions
1. Features of single entry system.
2. "Donations" "Legacies" Explain.
3. Fixed Vs. Fluctuating Capitals.
4. Calculate purchases from the following:
Cost of goods sold Rs.1,30,000; Stock (Opening) Rs.8,000; Closing Stock
Rs.10,000.
5. Show the treatment for the following :
Prize fund Rs.50,000, Prize paid Rs.20,000, Investment of prize fund
Rs.40,000; Interest on investments of prize fund Rs.4,000; Match expenses paid
Rs.5,000.
6. P.Q are partners sharing profits in the ratio of 3 : 2. They admitted 'R' into
business for 1/5 share. Calculate new profit sharing ratio.
7. X,Y,Z are partners sharing profits in the ratio 4 : 3 : 2 . 'Y' retires. Calculate
gaining ratio.
8. Excel Ltd. issued 50,000 equity shares of 10 each at a premium of Rs.2
per share as following : On application Rs.3 On allotment Rs.5 (including
premium) On 1st and Final call Rs.4 Journalize the above in the books of the
company.
9. Abishek purchased a van on 1.1.10 on hire purchase system at a cash
price of Rs.1,12,000. The payment being Rs.30,000 on signing the agreement.
Balance in 3 equal installments of Rs.30,000 each. Interest was charged at 5%
p.a. Depreciation written off @20% p.a on reducing balance method. Give
necessary ledger accounts, in the books of Abishek.
10. Explain the treatment of goodwill as per AS10 in respect of admission of
partner.
11. Following is the Receipts and Payments A/c of Healthcare Hospital for the
year ended 31.3.10.
Receipts
Rs
Payment
Rs
To Balance b/d
5,600 By Medicines
24,000
To Subscriptions
45,600 By Salaries
22,000
To Donations
11,600 By Sundry expenses
400
To Charity show
8,000 By Equipment
12,000
By Charity show
800
By Honorarium
8,000
SKU(AA2EM) SEPTEMBER 2012
By Balance c/d
70,800
Additional Information:
38
3,600
70,800
1.4.09 (Rs) 31.3.10 (Rs)

Subscriptions due
1,000
2,000
Stock of medicines
8,000
6,000
Value of equipment
16,000
21,000
Buildings
80,000
72,000
Prepare Income and Expenditure A/c and Balance sheet.
12. A,B are partners sharing profits in the ratio of 3 : 2. Their Balance sheet is
given below:
Liabilities
Rs
Assets
Rs
Capital :
Machinery
1,95,000
A
2,00,000 Stock
1,65,000
B
1,50,000 Debtors
1,50,000
Reserve
1,50,000 Bank
60,000
Creditors
75,000 Cash
5,000
5,75,000
5,75,000
'B' decided to retire from business on the following conditions :
a) Goodwill is valued Rs.15,000.
b) Depreciate machinery by 7% and stock by 15%.
c) Provide bad debts reserve at 5%.
Journalize the above and open the balance sheet.
13. X and Y carrying on business sharing profits in the ratio of 5 : 3. Their
balance sheet is given below:
Balance Sheet
Liabilities
Rs
Assets
Rs
Capital:
Bank
24,000
X
4,00,000 Debtors
2,00,000
Y
2,00,000 Stock
1,00,000
Creditors
1,00,000 Investments
76,000
Reserve fund
2,00,000 Plant
5,00,000
9,00,000
9,00,000
The admit 'Z' into business on the following conditions :
a) Stock to be depreciated by 20%
b) Provide 5% reserve for debtors.
c) Plant to be depreciated by 10%.
d) Z has to bring Rs.16,000 as goodwill and 1/8 combined capitals of X and
Y. Show balance sheet after 'Z' admission.
14. X Ltd. issued 2,00,000 shares of Rs.10 each at a premium of 20% payable
as follows:
Rs
On Application
2
On Allotment
5
47
Y
Z
15,000 Fixtures
2,000
15,000
90,000
90,000
On that date, Z retires from the firm and for this purpose the goodwill of the firm has
been valued at Rs. 18,000. Stock has been revalued at Rs. 20,000. Machinery at Rs.
15,000. Fixtures at Rs. 10,000 and a Reserve of Rs. 3,000 for doubtful debts has been
agreed to be created.
Open ledger accounts and show the balance sheet of X and Y after Z's retirement.
16. On 31.12.2003 a company's accounts shows that debenture redemption fund of
Rs.1,50,000 which was represented by Rs.1,51, 000 '(5%) municipal bonds purchased for
Rs.1,50,000.
On 1.1.2004, the company had a bank balance of Rs.28,000 and sold the
investment for 1,50,500 and the debentures of the value of Rs.1,50,000 were paid off.
Show necessary ledger accounts.
SOLUTIONS SKU(AA2EM) - MARCH 2011

PART A
1. What are the limitations of single entry system?
2. What are the characteristics of receipts and payments account?
3. How do you treat goodwill when a partner is admitted?
4. Computation of opening capital fund
Capital of the end
20,400
(+) Drawings
3,000
23,400
(-) Capital Introduced
5,000
18,400
(+) Loss
2,000
Capital at the beginning 20,400
5.
Dr
Sationary A/c
Particulars
Rs
Particulars
To Balance b/d
400 By o/s stationary
To Cash paid
1,500 By Income & Exp A/c
By Balance c/d
1,900
Amount debited to income & Expenditure A/c 1,450/6.
Dr
Particulars
Rs
Particulars
To Interest on capital
By Balance b/d
2,000
A (20,00010/100)
1,500
B (15,00010/100)
1,000
C (10,00010/100)
To Cs salary
2,000
To Profit
Cr
Rs
300
1,450
150
1,900
Cr
Rs
9,200
46
and the balance by instalment of Rs.4,000 per year with interest at 4%. You are required to
give necessary ledger accounts in the books of Usha company assuming depreciation at
10% on straight line method.
12. The following is the receipts and payments a/c of the Ashok Nagar association for
the year ended 31.12.2005.
Rs.
Rs.
To Balance 1.1.05
3,000 By Rent
14,400
To Entrance fees
5,500 By Stationery
2,870
To Subscriptions
By Wages
9,800
2004
2,000 By Billiard tables
39,000
2005
85,000 By Repairs etc
5,410
2006
2,000 By Interest
6,200
To Locker Rent
1,600 By Furniture
2,000
To Special subscriptions for dinner
7,600 By Books
3,000
By Fixed Deposit
10,000
By Dinner Expenses
5,800
By Balance on 31.12.2005
8,220
1,06,700
1,06,700
Locker rent Rs.300 related to 2004, Rent Rs.2,400 has been paid in advance.
Subscriptions Rs.1,600 are unpaid for 2005.
Prepare income and expenditure a/c and balance sheet for the year 31.12.2005.
13. A and B start business with capitals of Rs.80,000 and Rs.40,000 on 1.1.05. B is
entitled to a salary of Rs.500 per month. Interest is allowed on capitals and is charged on
drawings at 6% p.a. profits are to be distributed equally after making the above
adjustments. During the year 'A' withdrew Rs.8,000 and B Rs.10,000. Profit before the
adjustment amounted to Rs.50,000. Assuming the capitals to be fixed, prepare the profit
and loss adjustment a/c and the account relating to partners.
14. The following is the balance sheet of 'A', 'B' and 'C' who share profits in the ratio of
3 : 2 :1. Their balance sheet is given below.
Rs.
Rs.
Creditors
5,000 Land and Buildings
48,000
Capitals
Machinery
7,000
A
57,000 Stock
29,000
B
32,000 Debtors
25,200
C
16,000 Cash
800
1,10,000
1,10,000
They agreed to take 'D' into business for 1/10 share in the profits on the following terms.
a) D should bring Rs.3,000 as goodwill and Rs.8,000 as his capital.
b) The Machinery be depreciated by 12%
c) That a reserve of 5% created for doubtful debts
d) The stock be depreciated by 10%
e) That the value of land and buildings brought upto Rs.62,000.
Prepare necessary accounts and show the opening balance sheet of new firm.
15. X, Y, Z are partners sharing profits in proportion to capital stood as follows.
Rs.
Rs.
Creditors
30,000 Cash at bank 13,000
General Reserve 10,000 Debtors
35,000
Capitals
Stock
35,000
X
20,000 Machinery
25,000

39
Including premium
On 1st call
3
On 2nd call
2
Applications received for 2,50,000 and allotment made on pro-rate basis.
All the money due were received. Journalize the above.
16. Explain fixed and fluctuating capital A/c's
SOLUTIONS SKU (AA2EM) SEPTEMBER 2012
PART A
1. Features of single entry system. : Refer Q.No.2, Page No.1
2. "Donations" "Legacies" Explain. : Refer Q.No.14, Page No.12
3. Fixed Vs. Fluctuating Capitals. : Refer Q.No.17, Page No.14
4. Purchases = Cost of good sold + Closing stock Opening stock
= 1,30,000+10,000 8,000 = 1,32,000
5.
Balance Sheet
Liabilities
Rs
Assets
Rs
Prize Fund
50,000
Prize fund Investments 40,000
(+) Interest on Investment 4,000
54,000
(-) Expenses
20,000 34,000
6.
1
5
th
1
5
share given to R, remaining share is 1
4
5
4 3 12

5 5 25
4 2 8
Qs New Share =
5 5 25
1
5
or
Rs Share =
5
25
Ps New Share =
Ratio = 12 : 8 : 5
7. Refer QNo.7 in March 2011

8.
Date
Particluars
Debit Credit
Bank A/c
Dr 1,50,000
1,50,000
Share Application A/c
Dr 1,50,000
To Share capital
1,50,000
(Being share application money transferred to share capital)
Dr 2,50,000
Share Allotment A/c 50,0005

40
1,50,000
To Share capital 50,0003
1,00,000
To Share premium 50,0002
Bank A/c
Dr 2,50,000
2,50,000
(Being share Allotment money received)
Dr 2,00,000
Share First and final call A/c 50,0004
2,00,000
(Being Share call money due)
Bank A/c
Dr 2,00,000
To Share first & final call
2,00,000
(Being share first & final Call money received)
PART B
9.
Analysis table
No. of Installments Cash Price Interest Principle Installments Rs
1,12,000
1.1.10
30,000
-30,000
30,000
82,000
31.12.10
25,900
4,100
25,900
30,000
56,100
31.12.11
27,195
2,805
27,195
30,000
28,905
31.12.12
28,905
1,905
28,905
30,000
-8,000 1,12,000
1,20,000
Calculation of Depreciation
Rs
Cost of machine on 1.1.10 1,12,000
22,400
89,600
17,920
71,680
14,336
Machine Balance
57,344
Dr
Date
Particulars

Van A/c
Rs
Date
Particulars
1,12,000 31.12.10 By Depreciation
By Balance c/d
1,12,000
By Balance c/d
89,600
By Balance c/d
Cr
Rs
22,400
89,600
1,12,000
17,920
71,680
89,600
14,336
57,344

Bank A/c
To Share final call A/c
(Being share final call money received)
45
Dr 4,00,000
4,00,000
Ans: Refer Q.No.3, Page No.2
16. Explain fixed and fluctuating capital A/c's

II B.Com. DEGREE EXAMINATION MARCH 2011
PAPER - VI(552-B1) : ADVANCED ACCOUNTING

Time : 3 Hours
(2009-10 Regulation)
[Max. : 70 Marks
PART A (5 6=30 Marks)

Answer Any FIVE Questions
1. What are the limitations of single entry system?
2. What are the characteristics of receipts and payments account?
3. How do you treat goodwill when a partner is admitted?
4. Calculate the missing figure.
Rs.
Capital at the end
20,400
Capital introduced
5,000
Drawings
3,000
Loss
2,000
Capital at the beginning
?
5. Calculate amount to be debited to income and expenditure a/c for the year 2008.
Rs.
400
Creditors for stationery outstanding on 1.1.2008
300
Amount paid for stationery during 2008
1,500
150
6. A, B and C are partners sharing profits and losses in 4 : 3 : 2. with capitals
Rs.20,000, Rs.15,000, Rs.10,000. The profit for the year before charging interest on capital
@ 10% amounted to Rs.9,200. 'C' is entitled to a salary of 2000. Prepare profit and loss
adjustment a/c.
7. X, Y, Z are sharing profits in the ratio of 4 : 3 : 2. Y retires from the business.
Calculate gaining ratio.
8. XYZ company limited issued 10,000 shares of Rs.10 each payable Rs.2 on
application. Rs.5 on allotment and the remaining balance on call. Applications were
received for 9,000 shares and the shares were duly allotted. Write Journal entries and
prepare cash book in the books of company.
PART B (410 = 40 Marks)
9. Differentiate between Hire purchase system and instalment purchase system.
10. Explain the procedure to be followed in case of admission of a partner.
11. On 1.1.2000 Usha company obtained machines on hire purchase system. The
cash price do the machine was Rs.25,000. The payment was to be made as Rs.5,000 down

Dr
Particulars
To Balance b/d
To Goodwill A/c
To Z Capital A/c
To Balance b/d
Liabilities
Capital A/c
X
Y
Z
Creditors
Rs
4,85,000
2,51,000
92,000
1,00,000
44
Bank A/c
Rs
Particulars
16,000
92,000
1,32,000
1,32,000
Balance Sheet
Assets
Bank
Debtors
2,00,000
(-) R.B.D
10,000
Stock
1,00,000
(-) Depreciation
20,000
Investment
Plant
5,00,000
(-) Depreciation
50,000
Cr
Rs
1,32,000
1,32,000
Rs
1,32,000
1,90,000
80,000
76,000
4,50,000
9,28,000
9,28,000
14.
Journal Entries in the Book of X Ltd
Date
Particulars
Debit Credit
Bank A/c
Dr 5,00,000
5,00,000
Dr 5,00,000
4,00,000
To Share capital A/c (2,00,0002)
1,00,000
To Share allotment (50,0002)
(Being share application money transfer to share capital)
Dr 10,00,000
Share allotment A/c (2,00,0005)
6,00,000
To Share Capital (2,00,0003)
4,00,000
To Share premium (2,00,0002)
(Being share allotment money due)
Bank A/c
Dr 9,00,000
To Share allotment (10,00,000-1,00,000)
9,00,000
Share 1st call A/c
Dr 6,00,000
6,00,000
(Being share 1st call money due)
Bank A/c
Dr 6,00,000
To Share 1st call A/c
6,00,000
(Being share 1st call money received)
Share final call A/c (2,00,0002)
Dr 4,00,000
4,00,000
(Being share final call due)
71,680
57,344
Dr
Date
Particulars
1.1.10 To Bank
31.12.10 To Bank
To Balance c/d
Vendor A/c
Rs
Date
Particulars
30,000 31.12.10 By Van A/c
30,000
By Interest
56,100
1,16,100
31.12.11 To Bank
30,000 1.1.11 By balance b/d
To Balance c/d
28,905
By Interest
58,905
31.12.12 To Bank
30,000
By balance b/d
By Interest
30,000
Dr
Date
Particulars

Dr
Date
Particulars
31.12.10 To Asset A/c
Interest A/c
Rs
Date
Particulars
4,100 31.12.10 By P&L A/c
4,100
2,805 31.12.11 By P&L A/c
2,805
1,905 31.12.12 By P&L A/c
1,905
41
71,680
Cr
Rs
1,12,000
4,100
1,16,100
56,100
2,805
58,905
28,905
1,095
30,000
Cr
Rs
4,100
4,100
2,805
2,805
1,905
1,905
Depreciation A/c
Cr
Rs
Date
Particulars
Rs
22,400 31.12.10 By P&L A/c
22,400
22,400
22,400
17,920 31.12.11 By P&L A/c
17,920
17,920
17,920
14,336 31.12.12 By P&L A/c
14,336
14,336
14,336
10. Explain the treatment of goodwill as per AS10 in respect of admission of
partner.
11.
Income and Expenditure A/c
Particulars
Rs
Particulars
Rs
To Medicines
24,000
By Subscription
45,600
(+) Op stock
8,000
(-) O/s for 2009
1,000
32,000
44,600
(-) Closing stock
6,000 26,000 (+) O/s for 2010
2,000 46,600
To Salaries
22,000 B y Charity show receipt
8,000
To Expenses
400 By Deficiency A/c
17,600
To Depreciation on equipment

(16000+12000-21000)
To Honorarium
To Depreciation on Building
To Charity show expenses
Liabilities
Capital fund
Liabilities
Capital funds
(-) Deficit
Donatioy
12.
Date
42
7,000
8,000
8,000
800
72,200
Rs
Assets
1,10,600 O/s subscription
Medicine
Equipment
Building
Cash
1,10,600
Rs
Assets
1,10,600
Cash
17,600 93,000 O/s subscription
11,600 Medicines
Equipment
Building
1,04,600
72,200
Rs
1,000
8,000
16,000
80,000
5,600
1,10,600
Rs
3,600
2,000
6,000
21,000
72,000
1,04,600
Particulars
Debit Credit
Revaluation A/c
Dr 46,875
To Machinery A/c
14,625
To Stock A/c
24,750
To Bad debits
7,500
(Being Decease in assets transfer to Revaluation A/c)
Reserve A/c
Dr 1,50,000
To A Capital A/c
90,000
To B Capital A/c
40,000
(Being reserve distributed)
Goodwill A/c
Dr 15,000
To A Capital A/c
9,000
To B Capital A/c
6,000
(Being goodwill created)
A Capital A/c
Dr 28,125
B Capital A/c
Dr 18,750
To Revaluation A/c
46,875
(Being loss on revaluation distributed a mans A&B)
Liabilities
Rs
Balance Sheet
Assets
Rs

A Capital
2,70,875 Machinery
1,95,000
B Capital
1,97,250 (-) Depreciation
14,625 1,80,375
Creditors
75,000 Stock
1,65,000
(-) Depreciation
24,750 1,40,250
Debtors
1,50,000
(-) R.B.D
7,500 1,42,500
Bank
60,000
Cash
5,000
Goodwill
15,000
5,43,125
5,43,125
13.
Dr
Revaluation A/c
Particulars
Rs
Particulars
To Stock
20,000
X
To Reserve for bad & doubtful debts
10,000
Y
To Plant
50,000
80,000
Dr
Particulars
To Revaluation A/c
To Balance c/d
Dr
Particulars
To Revaluation A/c
To Balance c/d
Dr
Particulars
To Balance c/d
Particulars
To X Capital A/c
To Y Capital A/c
Cr
Rs
50,000
30,000
80,000
X Capital A/c
Rs
Particulars
4,85,000 By Reserve
By Goodwill A/c
5,35,000
Cr
Rs
4,00,000
1,25,000
10,000
5,35,000
Y Capital A/c
Rs
Particulars
2,51,000 By Reserve
By Goodwill A/c
2,81,000
Cr
Rs
2,00,000
75,000
6,000
2,81,000
Z Capital A/c
Rs
Particulars
92,000 By Cash A/c
(4,85,000+2,51,000)1/8
By Balance b/d
92,000
Dr
43
Goodwill A/c
Rs
Particulars
10,000 By Cash
6,000
16,000
Cr
Rs
92,000
10,000
92,000
Cr
Rs
16,000
16,000

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1

B.Com. Second Year

SKU(AA2EM) OCTOBER 2010

Rs Capital Should be for 3 Shares

PAPER VI (552 BI) ADVANCED ACCOUNTING

Capitals = 21,000: 17,500 : 10,500 : 7,000

Balance Sheet as on 31.12.2000

II B.Com DEGREE EXAMINATION, MARCH 2014.

SKU(AA2EM) MARCH/APRIL 2014

SRI KRISHNADEVARAYA UNIVERSITY

SKU(AA2EM) MARCH/APRIL 2014

SKU(AA2EM) OCTOBER 2010

31-12-08 To Bal. c/d

31-12-10 To S.F. Investment A/c

01-01-07 To Bal. b/d

Sinking Fund Investments A/c

SKU(AA2EM) OCTOBER 2010

(Being the Investment, purchased)

Sinking Fund A/c

SKU(AA2EM) MARCH/APRIL 2014

SKU(AA2EM) MARCH/APRIL 2014

SKU(AA2EM) OCTOBER 2010

SKU(AA2EM) OCTOBER 2010

SKU(AA2EM) MARCH/APRIL 2014

SKU(AA2EM) MARCH/APRIL 2014

Mumbai Company A/c

SKU(AA2EM) OCTOBER 2010

To Loss on Sale or Investments

(-) Received in Advance

Balance Sheet as on 30-06-2004

Balance Sheet as on 30-06-2005

SKU(AA2EM) OCTOBER 2010

Motor Lorries A/c

SKU(AA2EM) MARCH/APRIL 2014

Income & expenditure A/c for the year ending 31.3.11

Income & Expenditure A/c for the year ending 30-06-05

SKU(AA2EM) MARCH/APRIL 2014

Profit and Loss Adjustment A/c

54,000 37,000 12,000

Balance Sheet as on 31.3.2012

Daniel Edward Fernandez Herlad

1,500 --- By Balance b/d

SKU(AA2EM) OCTOBER 2010

Calculation of Cash Price of a Machine.

SKU(AA2EM) OCTOBER 2010

7,500 Cash in Hand

Statement of Profit for the year ended 31.3.2005

SKU(AA2EM) MARCH/APRIL 2014

Adjustment A/c 1,500 1,500

SKU(AA2EM) MARCH/APRIL 2014

SRI KRISHNADEVARAYA UNIVERSITY

SKU(AA2EM) OCTOBER 2010

Plant and Machinery 8,500

ANSWERS SKU (AA EM) OCTOBER 2010

SKU(AA2EM) OCTOBER 2010

SKU(AA2EM) SEP./OCT. 2014

SKU(AA2EM) SEP./OCT. 2014

SKU(AA2EM) OCTOBER 2010

(2009-10 Regulations) (NR)

5. From the following details prepare Receipts and Payment account :

SKU(AA2EM) MARCH 2010

Statement of Profit/Loss for the year Ended 31-3-2004

SRI KRISHNADEVARAYA UNIVERSITY