YASH CLASSES

221,224, SAMAN COMPLEX, OPP STAR APARTMENTS,

NR MANSI CIRCLE, SATELLITE, AHMEDABAD
PH: 07940028282, M: 9825048601

STD-12

SUBJECT : ACCOUNTS DATE : 26-DEC-2017

TOTAL MARKS: 100 HOURS: 3

MULTIPLE CHOICE QUESTIONS (1 MARKS)

(1) Under which method, the interest on capital keeps on changing during the year due to the changes in
the capital ?
[A] Fluctuating capital accounts method [B] Fixed capital accounts method
[C] Current accounts method [D] None of above
(2) Which is the first payment made from the realisation of assets, at the time of the dissolution of a
firm :

[A] Dissolution expense [B] Loan of partner's wife

[C] Liabilities towards third parties [D] Partner's loan

(3) Goods returned credit means ………..

[A] Purchase return [B] Sales return [C] Purchase [D] Sales

(4) How many methods are there for dissolution of a partnership firm ?

[A] One [B] Three [C] Two [D] Four

(5) Where are the effects given when the value of assets increase at the time of the reconstruction of
a partnership firm ?

[A] Addition in assets value and the revaluation account will be credited.

[B] Addition in assets value and the revaluation account will be debited.

[C] Subtract from assets value and the revaluation account will be credited.

[D] Subtract from assets value and the revaluation account will be debited.

(6) As per SEBI guidelines, the minimum amount on each share called by company on application
must be at least ......... % of the issue price.

[A] 25 [B] 30 [C] 5 [D] 20

(7) Revaluation account is also known as ……..

[A] Capital reserves account [B] Profit-loss appropriation account
[C] Profit-loss adjustment account [D] Profit-loss account

(8) For which of the following items the ratios is computed in days?
[A] For total purchase [B] For credit sales
 [C] For credit purchase [D] Both (b) and (c)

(9) Formula for Sacrifice Ratio =

[A] New share - Old share [B] Old share - New share
[C] New share - Drawing [D] Old share - Drawings

(10) The analysis of the financial statements …… .

[A] presents only results [B] provides historical information
[C] makes interpretation [D] none of the above

ANSWER IN ONE OR TWO SENCTENCE (1 MARKS)

(11) Pass journal entries for the following transactions: Land - building ` 1,00,000 and investments `
50,000 are disclosed in the balance sheet at the time of dissolution. ` 80,000 and ` 60,000 are
realised respectively from them.

(12) Write the formula for gain ratio.

(13) As which activity income tax payment and income tax refund are considered? Why?

(14) What is included in financial statements?

(15) How accumulated profit and reserves are distributed among partners at the time of
reconstruction of partnership firm?

(16) State the circumstances of the retirement of a partner.

(17) What is capitalized profit ?

(18) Under which head 'Securities premium reserve account' appears in the balance sheet?
(19) What is the shareholders' funds?

(20) What is cash flow statement?

ANSWER IN BRIEF (3 MARKS)

(21) Write short note : Realisation Account.

(22) Dhyey, Siddhi and Parpti are the partners in a firm sharing profits and losses in the ratio of 1 : 1 :
1. All partners have decided to share profit and loss in the new ratio of 1 : 3 : 3. From the above
information, find out the gain ratio.
(23) Vismay, Abhijit and kunal are partners sharing profit-loss in the proportion of 3 : 2 : 4. Manager is
to be paid 10% commission on profit but after the deduction of his such share the share of profit
of Abhijit is Rs. 30,000. Determine the commission of manager.
(24) Prakhar Limited issued 8000; 7.5 % convertible debentures of ` 200 each at par as on April 1,
2014. As per the terms of issue of debentures, all the debentures will be converted into shares
after 4 years and for this one equity share of ` 10 each will be issued at a premium of 25 % against
each debenture.
As per the agreed terms, all the debentures are converted into shares as on April 1, 2018. Write
necessary journal entries in the books of company.
 (25) Ashok Mills Limited issued 8000 debentures of ` 100 each for public subscription. Interest is to be
paid at the rate 8 % p.a. on debentures. The amount were called up per debenture as under :
With application ` 30
On allotment ` 40
On call ` 30
Application were received by company of 10,000 debentures. After allotment of 8000
debentures, rejected excess applications of debentures and refunded the money to applicants. All
the amounts due on allotment and call were duly received.
Write journal entries in the books of the company.
(26) In which circumstances court can pass the order for dissolution of a firm ? Explain.
ANSWER IN BRIEF (4 MARKS)

(27) Explain the simple average method for the valuation of goodwill.

(28) Harpal, Rajesh and Jyesh's firm's information is as under:

(1) Business assets: ` 10,00,000
(2) Business liabilities: ` 2,00,000
(3) Expected rate of return: 10%
(4) Firm's last five years profit as under:
Year Profit (`)
2012-13 90,000
2013-14 1,10,000
2014-15 1,20,000
2015-16 1,30,000
2016-17 1,40,000
From the above information, determine the value of goodwill of the firm.
(1) Calculate the goodwill of the firm equal to five years average profit.
(2) On the basis of 3 years purchase average profit.
(3) On the basis of 2 years purchase of weighted average profit.
(4) On the basis of 4 years purchase of super profit (Weighted average basis)
(5) As per capitalization profit method.
(6) As per capitalization of super profit.
(29) From the following information calculate cash flow from financing activities:
Particulars 31-3-2017 (`) 31-3-2016 (`)
10% debentures 2,45,000 1,95,000
Equity share capital 3,45,000 2,50,000
12% debentures 1,00,000 1,50,000
Preference share capital 80,000 1,00,000
Bank overdraft 45,000 68,000

Additional information:
(1) Debenture interest paid ` 12,000
(2) Paid ` 22,000 for equity share dividend and preference share dividend
(3) Paid bank overdraft ` 4000

(30) From the following information of 'C' Company Ltd., calculate creditors turnover and payment
period in days. What will be answer if payment period is calculated in terms of weeks and
months? (Assume 360 days of the year)
Particulars (`) Particulars (`)
Opening balances: Credit sales 6,00,000
 Creditors 45,000 Cash sales 4,00,000
Bills payables 15,000 Total sales 10,00,000
Bills receivables 30,000 Total purchase 6,00,000
Debtors 30,000 Cash purchase 2,40,000
Closing balances:
Creditors 40,000
Bills payables 20,000
Bills receivables 40,000
Debtors 20,000

(31) Find out figures of common size profit and loss statements of two years :
No. Particulars Note 31-3-2017 (`) 31-3-2016 (`) 31-3-2017 31-3-2016
No. (%) (%)
(I) Sales revenue 60,75,000 45,00,000 100 100
(II) Expenses :
(i) Cost of goods ? 30,00,000 68 70
(ii) Financial cost ? 2,00,000 10 12
(iii) Depreciation ? 70,000 2 3
Total Expenses 36,00,000 51,00,000 80 85
(III) Profit before tax 9,00,000 9,00,000 20 15
(IV) Less : Income tax 30% ? ? ? ?
(V) Profit after tax ? ? ? ?

ANSWER IN BRIEF (8 MARKS)

(32) Ahmadabad Chemical Limited issue 1,50,000 equity shares of ` 100 each at a premium of ` 30 per
share. Amount payable was as under :
On share application and allotment ` 85 per share (including premium)
On share first and final call - balance amount.
Applications were received for 2,55,000 shares. Applications for 55,000 shares were rejected and
allotment was made pro-rata to the remaining applicants. The excess share application and
allotment money was to be credited to share first and final call. Amount was called on calls.
Entire called up amount was received in time.
Pass necessary journal entries for recording the above transactions in the books of Ahmadabad
Chemical Ltd.

(33) Aashtha and Aahna are partners in a firm. the balance sheet of the firm as on 31-3-2017 was as
under :
Liabilities Amt.(Rs.) Assets Amt.(Rs.)
Capital account : Goodwill 8400
Aashtha 76,000 Land-Building 40,000
Aahna 48,400 1,24,400 Machinery 32,000
Workmen compensation fund 4,800 Investment 20,000
Investment fluctuation fund 1,600 Debtors 25,200
Provident fund 6,400 Stock 14,400
Bad debt reserve 8,000 Cash 16,000
Creditors 12,000 Advertisement campaign 3,200
expenditure
 Bills payable 6,000 Profit-loss A/c 4,000
1,63,200 1,63,200
The admitted Sonu as a new partner as on 1-4-2017 on the following condition :
(1) Sonu will bring Rs. 80,000 as her capital and Rs. 7200 as her share of goodwill in cash. (2) New
profit and loss sharing ratio will be 4 : 3 : 3. (3) Goodwill is to be valued at Rs. 40,000. (4) The
claim of workmen compensation is accepted at Rs. 3,200. (5) Aahna will take over investrments at
19,200. (6) Accured interest on investment Rs. 2,400 is not recorded. (7) Accepted bills payable of
Rs. 2,000 which was drawn by creditors is not recorded. (8) Book value of land-building is 20%
less than its market value. (9) Out of insurance premium paid,Rs. 4,800 is for next year. Prepare
necessary accounts and balance sheet after admission.
(34) Shivani and Niraj are the partners in a firm sharing profit and loss in the ratio of
1 : 2. Balance sheet of their firm as on 31-3-2016 was as under:
Balance Sheet
Liabilities Amt. (`) Assets Amt. (`)
Capital: Goodwill 27,000
Shivani 1,00,000 Land-Building 1,50,000
Niraj 1,50,000 2,50,000 Machinery 50,000
Profit-loss A/c 9000 Stock 20,000
General reserve 15,000 Debtors 30,000
Creditors 25,000 Bills receivable 10,000
Bad debt reserve 8000 Cash 20,000
3,07,000 3,07,000
They admitted Vijay as a new partner as on above date for the following terms:
(1) Bad debt reserve is to be kept ` 5000 on debtors.
(2) Goodwill is valued at ` 36,000.
(3) Value of land and building is to be appreciated by 10%.
(4) Book value of machinery is 25% more than its market value.
(5) Value of stock is to be decreased by 10%.
(6) Vijay will bring 50% of net assets of new firm as the capital and his share of goodwill in cash.
(7) Shivani sacrifices rd of her share and Niraj sacrifices share for Vijay.
1 1
3 3
Prepare necessary accounts and balance sheet after admission of a new partner.
(35) Gopi, Krishna and Ram are the partners of a firm sharing profit-loss in the ratio of and .
1 1 1
,
2 3 6
The balance sheet of the firm as on 31-3-2017 is as under:
Balance Sheet
Liabilities Amt. (`) Assets Amt. (`)
Capital Accounts: Goodwill 1500
Gopi 30,000 Trademark 18,000
Krishna 20,000 Machinery 60,000
Ram 30,000 80,000 Investments (Market value ` 15,000) 40,000
Current Accounts: Stock 12,000
Gopi 08,000 Debtors 26,000
Ram 10,000 18,000 Cash in bank 3000
Contingency reserve 12,000 Current account of Krishna 4500
Workmen compensation fund 9000
Investment fluctuation fund 15,000
 Creditors 23,000
Bad debt reserve 8000
1,65,000 1,65,000
Ram retires on 1-4-2017 on the following terms:
(1) The value of machinery is to be increased by 10%.
(2) The value of trademarks is to be reduced upto 40%.
(3) Bad debt reserve on debtors is to be kept at 15%.
(4) Discounted bills receivable of ` 1300 which is dishonoured on due date, 31-3-2017. No
amount is received from the debtors.
(5) Goodwill of the firm is valued at ` 60,000.
(6) The new profit-loss sharing ratio of Gopi and Krishna is 2 : 1.
Prepare revaluation account, current account, capital account and balance sheet after the
retirement of Ram.

ANSWER IN BRIEF (11 MARKS)

(36) Radha and Mira are partners sharing profit - loss in proportion of 3:2. their Trial Balance as on 31-
3-2017 was as shown page mumber 65:
Trial Balance of Partnership Firm of Radha and Mira as on 31-3-17
Particular Debit (`) Credit (`)
Capital Account:
Radha - 20,000
Mira - 10,000
Current Account:
Radha 5000 -
Mira - 1000
Purchase and sales 15,000 32,000
Receivables and payable 16,000 9800
Motor car 12,000 -
Goods returned 1000 500
Sundry expense 800 -
Providend fund and contribution to providend 200 4000
fund
Bank and cash 2500 19,847
Opening stock 9000 -
Bank interest 142 -
Building 12,950 -
Stationary stock (1-4-16) 200 -
Stationary purchase 1000 -
Bad debts return - 700
Sales of old newspapers - 1000
Professional tax 800 -
Patent 4000 -
Trademark 5000 -
Carriage inward 200 -
Discount 125 325
Plant - machines 8325 -
Depreciation on plant - machines 675 -
Depreciation on motor car 2000 -
Freight and octroi 350 -
 Discount reserve - 250
Bad debt reserve - 1000
Investment of providend fund 4000 -
Interest providend fund investments - 240
9% Kanaiya's lon (1-6-16) - 7000
Interest on loan 315 -
Insurance premium (Out of which premium of 600 -
` 400 is for the year ending on 30-6-2017)
Salary and wages 3730 -
Furniture 1500 -
Dead stock 150 -
Demurrage 100 -
Total 1,07,662 1,07,662
Adjustments: (1) Value of closing stock is ` 15,000, out of which 10% and 15% goods have market
value less than book value by 12% and 20% respectively. (2) Stationery stock as on 31-3-17 ` 500.
(3) A furniture of ` 600, sold to Kishan for ` 400 on 1-10-2016, which is recorded in the sales
book. (4) Increase in the rate of depreciation to 10% on plant and machines. (5) Provide 5%
depreciation on furniture. (6) Write off ` 600 from debtors as bad debts and provide bad debts
reserve 5%. (7) Provide 2% discount reserve on debtors. (8) Goods of ` 3000 withdrawn by Mira
for personal use on 1-1-17, it is recorded in the sales book. (9) Calculate 10% p.a. interest on
capital of partners. (10) ` 2000 Annual salary will be given to Radha for her active participation in
business.
(37)(a) Following balance are taken from of vijay Ltd.as on 31-3-2017.Prepare statement indicating assets of
balance sheet as on 31-3-2017 as per scheduled-III of Companies Act,2013.
No. Balance
(1) Fixed assets-tangible 8,00,000
(2) Cash and cash eqivalents 60,000
(3) Long-term loans and advances 34,000
(4) Inventory 43,000
(5) Other non-current assets 31,000
(6) Non-current investments 27,000
(7) Current investments 29,000
(8) Trade receicable 56,000
(9) Shot-term loans and advances 40,000
(10) Other current assets 10,000
(11) Fixed assets-intangible 50,000

(b) Following is the trial balances of Parth Ltd. as on 31 - 3 - 2017:

Balance Debit (`) Credit (`)
Sales 11,25,000
Employee benefit expenses 1,95,000
Inventories 1,65,000
Finance costs 26,250
Security premium 60,000
Fixed assets - tangible 12,00,000
Trade payables 90,000
Equity share capital 7,50,000
Trade receivables 60,000
Other income 30,000
 Long - term borrowings 5,25,000
Cash and bank balance 90,000
Depreciation 33,750
Cost of goods sold 6,00,000
Non - current investment 2,10,000
25,80,000 25,80,000
From the above information, prepare final accounts of the company for the year ended on 31 - 3 -
2017 as per Schedules - III of Companies Act, 2013. Notes to the accounts are not required.