PRACTICE QUESTIONS

SUBJECT - ACCOUNTANCY

CLASS – XI

1) Mention any one cause responsible for the difference between current and fixed assets.

2) What do you understand by Imprest amount in cash book?

3) Name the column of cash book which always has debit balance.

4) If Bank Reconciliation Statement is prepared with the balance of pass book, which book’s
balance we shall get at the end?

5) Mention the formula for calculation of depreciation by straight line method.

6) Mention whether noting charges is gain or loss or neither gain nor loss for the drawer.

7) Explain the following with examples-

a) Money measurement concept.

b) Principle of full disclosure.

c) Principle of consistency.

8) Use accounting equation to show the effect of following transactions on assets, liabilities and
capital:

a)Started business with cash Rs 70,000

b)Purchased goods on credit Rs 18,000

c)Purchased machinery Rs 20,000

d)Payment made to creditors in full settlement Rs 17,500.

e)Depreciation on machinery Rs 2,000

9) Prepare a double column cash book from the following transactions of Yogita:

1.1.2012 Opening balance:cash-Rs150

Overdraft at bank:Rs1,000

2.1.2012 Cash received from sale of goods Rs 3,000

and deposited the same into the bank on 4.1.2012.

 6.1.2012 Cash withdrawn from bank Rs 500 for office use.

10.1.2012 Withdrew from bank for personal use Rs100.

15.1.2015 Paid office rent by cheque Rs 200.

10) Enter the following transactions in the sales returns book:

2013

Jan 9 Returned by Rajesh&Co.(Credit Note No308)

20 bags Coffee@Rs300 per bag

10 Chests Tea@Rs400 per chest

Jan17 Returned by Ashok Bros.(Credit Note No.412)

15 tins Ghee@500 per tin

Q.11 Prepare Bank Reconciliation Statement from the following particulars on 31st July,2013:

(i) Balance as per pass book Rs500.

(ii) Three cheques for Rs 60,Rs 39.37 and Rs 15.25 issued in July ,2013 were presented for
payment to the bank in August 2013.

(iii)Two cheques of Rs 50 and Rs 65 sent to the bank for collection were not entered in the pass
book by July 31,2013.

(iv)The bank charged Rs 46 for its commission and allowed interest Rs10 which were not
entered in his bank account.

Q.12 A bill for Rs 5,000 payable for three months after date is drawn by Kusum on Suman and
accepted by the later.Show entries that would be passed in the journal of Kusum,in each of the
following cases:
(a) If she keeps the bill till maturity and then receives payment of it on the due date.
(b)If she discounts it at their bank for Rs 4,950.
(c) If she endorses it to her creditor Pushpa.
(d) If she sends it to her bankers for collection and the bill is collected.
Q.13 Calculate closing stock from the following information:

Name of Account Rs

Sales 20,000

Purchases 12,300
 Returns inward 500

Carriage inward 400

Returns Outward 1,000

Gross Profit 8,000

Q.14 There was an error in records on 31-3-2015 and the difference in books was carried to a
Suspense Account.On going through the books you find that:

(i) Rs 5,400 received from Mr A was posted to the debit of his account.

(ii) Rs 1,000 being purchases return were posted to the debit of Purchases Account.

(iii) Discount received Rs2,000 was posted to the debit of Discount Account.

(iv) Rs 2,740 paid for repairs to Motor Car was debited to Motor Car Account as Rs1,740.

(v) Rs 4,000 paid to B was debited to A’s Account.

Give journal entries to rectify the above error and ascertain the amount transferred to Suspense
Account on 31st March,2012,assuming that the Suspense Account is balanced after the above
corrections.

Q.15 From the following Trial Balance of Shri Ram &Sons,prepare the Trading and profit and loss
account for the year ended 31st,March,2013.

TRIAL BALANCE

(as on 31st March,2013)

NAME OF ACCOUNT Debit Credit

Ram’s Capital 29,000

Ram’s Drawings 760

Purchases and Sales 8,900

Sales and Purchases Return 280

Stock(1-4-2012) 1,200

Wages 800

Building 22,000

Freight and Carriage 2,000

 Trade Expenses 200

Advertisement 240

Interest 350

Taxes and Insurance 130

Debtors and Creditors 6,500 1,200

Bills Receivable and payable 1,500 700

Cash at bank 1,200

Cash in hand 190

Salaries 800

46,700 46,700

Adjustments:(i)Stock on 31st March,2013 was valued at Rs1,500.

Q.16 A company whose accounting year is the calendar year purchased a machinery costing Rs
30,000. It further purchased machinery ,on 1st October,2008 costing Rs20,000 and on July,2009
costing Rs10,000.

On 1st January,2010 one-third of the machinery which was installed on 1st April,2008 became
obsolete and was sold for Rs 3,000.

Show how the machinery account would appear in the books of the company.The depreciation
is charged at 10% p.a on Written Down Value Method.

Q.17 Mr Ashok does not keep his books properly.

Following information is available from his books

Particulars Jan.01,2005 Dec.31,2005

Sundry creditors 45,000 93,000

Loan from wife 66,000 57,000

Sundry debtors 22,500 -

Land & building 89,600 90,000

Cash in hand 7,500 8,700

Bank overdraft 25,000 -

 Furniture 1,300 1,300

Stock 34,000 25,000

During the year Mr Ashok sold his private car for Rs 50,000 and invested this amount into the
business. He withdrew from the business Rs 1,500 per month upto July 31,2005 and thereafter
Rs 4,500 per month as drawings.You are required to prepare the statement of profit or loss and
statement of affairs as onDecember31,2005.

Q.18 Calculate the amount of expenses to be debited to Income and Expenditure A/c and show its
effect on Balance Sheet as on 31st March,2014.

Salaries paid by a club during 2014 amounted to Rs16,000.Information about prepaid and
unpaid is given below: Rs Rs

31st Mar’13 31stMar’14

Prepaid Salary 1,200 2,000

Unpaid Salary 2,500 1,500

Q.19 Prepare the Income&Expenditure Account from the provided Receipt &Payment Account.

RECEIPTS AMOUNT PAYMENT AMOUNT

To Balance b/d 3,000 By Furniture 4,000

To Interest 1,900 By Salaries 13,800

ToDonations 21,000 By Expenses 300

To Subscriptions 30,000 By Telephone

Charges 14,500

To Rent received 13,500 By Fax machine 6,500

To Sale of papers 600 By Investments 16,000

By Stationery 300

By Balance c/d 14,600

70,000 70,000

ADDITIONAL INFORMATION-Subscriptions received include Rs 750 for 2015.The amount

of subscriptions Outstanding on 31st Mar’14 was Rs 600;Salaries during 2014 unpaid were Rs
 1,200 and Rent receivable was Rs 350.70% of the Donations were to be capitalized.Capital
Fund as at 31st March,2013 was Rs 12,400 and club also had investments of Rs 10,000.

Q.20 (a)Mr Suresh is an accountant of ABC firm. He found an error in the accounting entry in the
books of accounts.However,he did not disclose it to the management of the firm fearing that it
will risk his job.Which values are not followed by Mr Suresh?

(b) Mr Farooq is owner of ABC Firm.He made a will of his property where he gave 50% each to
his son &daughter.Which value he followed here?

Q.21 Define accounting. Explain its objectives and functions.

Q.22 “Every transaction in Double Entry Book-Keeping must have a double entry.” Explain this
statement. Give the rules of journalizing with regard to the different classes of accounts.
Q.23 Explain the following terms:
a) Revenues b) Discount c) Deferred revenue expenditure d) Assets
e) Receivables f) Bad debts g) Event h) Creditors
Q.24 Explain the following principles:
a) Full disclosure concept b) Accounting period concept c) Consistency principle
Q.25 Explain the principles of accounting on which these comments are based:
a) Caliber or quality of management team is not directly disclosed in the Balance sheet.
b) Advance received from a supplier is not taken as income or sales.
c) Unrealized appreciation in the value of fixed assets cannot be used for the payment of
dividend.
Q.26 How does accrual basis of accounting differ from cash basis of accounting?
Q.27 “Accounting Standards ensure the consistency and comparability of Financial Statements.”
Explain.
Q.28 Give one example of each of the following transactions:
a) Increase in an asset and a liability.
b) Decrease in an asset and a liability.
c) Increase in assets and capital.
d) Decrease in asset and capital.
Q.29 Journalizing the following transactions:
a) Bought goods from Kumar for Rs. 40,000 less 15% trade discount and 2% cash discount.
Kumar paid 60% by cheque.
b) Withdrew Rs. 10,000 for personal use out of which he purchased furniture for office for
Rs. 3,000.
c) Cash Rs. 2,000 and goods Rs. 3,000 were stolen by an employee.
 d) Allow interest on capital Rs. 3,000.
e) Goods costing Rs. 4,000 (sale price Rs. 5,000) destroyed by fire. Insurance company
admitted the claim in full.
f) Insurance premium is prepaid Rs. 500.
g) Salary paid Rs. 4,000 but it is still unpaid Rs. 1,000.
h) Bought a shop for Rs. 60,000 by issuing cheque, however brokerage 2% and registration
charges Rs. 4,000 were paid in cash.
Q.30 Prepare cash book with cash and bank columns from the following information:
Feb. 2010
1 Balance of cash Rs. 4,000, Bank overdraft Rs. 9,400.
3 Sold goods to Ram of list price of Rs. 10,000 less 10% trade discount and 2% cash
discount. Ram paid 60% amount by cheque.
8 Bought goods from Ashok Rs. 5,400 and Mohan Rs. 3,000.
11 Bought machinery for Rs. 2,900 and paid carriage Rs. 100.
13 Endorsed Ram’s cheque to Ashok in full settlement of his account.
14 Paid Mohan by cheque Rs. 2,000 and rest by cash.
18 Received cheque from Sohan Rs. 5,400 and allowed him discount Rs. 100. It was
banked.
20 Sold goods for cash Rs. 5,000 of which Rs. 3,000 deposited in bank.
21 Advised bank to issue draft to Rakesh for Rs. 2,500, bank charges were Rs. 50.
23 Sohan’s cheque returned from bank as dishonoured. Bank charges Rs. 100.
25 Sohan gave another cheque which lodged with bank.
27 Bank charged Rs. 500.
28 A bill of exchange got from Rohan for Rs. 3,000 was discounted from bank @ 1%.
Q.31 Record the following transactions in proper Subsidiary Books of Indian Furniture Mart, Delhi:
2010
Jan 3 Bought from Welcome Furnitures, Delhi
2 Dinning Table @ Rs. 1,500 each.
20 Chairs @ Rs. 300 each.
Trade discount 10%
Jan 8 Sold to Laxmi Furnitures, Delhi
3 Almirahs @ Rs. 2,000 each
10 Centre Tables @ Rs. 400 each
Less: 15% Trade discount
Jan11 Rama Furniture, Delhi sold us:
20 Chairs @ Rs. 300 each
3 Sofa sets @ Rs. 2,000 each
 Trade discount 15%
Jan21 Bhagwati Furniture bought from us:
3 Dinning Tables @ Rs. 2,000 each
4 Tables @ Rs. 1,000 each
20 Chairs @ Rs. 250 each
Q.32 Prepare Trial Balance from the following information of Mohan Lal & Sons as on 31-12- 2010.
Capital of the firm is the balancing figure:
Rs. Rs.
Stock(Opening) 16,800 Sales 70,200
Cash 8,000 Printing & Stationery 4,000
Bank Overdraft 9,000 Return Inward 4,000
Purchases 50,000 Drawings 6,500
Return Outward 1,000 Salary 8,000
Furniture 20,000 Advertisement 5,000
Bad Debts 3,000 Discount Allowed 2,000
Discount Received 1,500 Debtors 24,500
Bills Payable 8,000 Creditors 22,000
Bills Receivable 8,500 Prov. For doubtful debts 2,000
Q.33 X Ltd. bought 4 machines for Rs. 60,000 each on 1st April, 2007. On 1st April, 2009, it sold
one machine at a profit of Rs. 2,000 and it sold another machine on 1st July, 2010 at a loss of
Rs. 5,000. Another machine was bought for Rs. 80,000 on 1st July, 2010.
Depreciation was charged at 15% on original cost method and account were closed on 31st
December each year. Prepare Machinery Account from 2007 to 2010.
Q.34 A company whose accounting year is a calendar year purchased on 1st April 2008 machinery
costing Rs. 30,000. It purchased further machinery on 1st Oct. 2008 costing Rs. 20,000 and on
1st July 2009 costing Rs. 10,000. On 1st Jan, 2010, one third of the machinery installed on 1st
April, 2008 become obsolete and was sold for Rs. 3,000.
Show machinery account as it would appear in the books of the company from 2008 to 2011.
If machinery was depreciated by diminishing balance method @ 10% p.a.
Q.35 On 1st Feb, 2006, Mohan sold goods worth Rs. 25,000 to Naresh and drew upon him a bill
payable after 90 days. Naresh accepted the bill and Mohan endorsed the bill immediately in
favour of his creditor Raja in full settlement of his account of Rs. 25,300.One week before
the maturity of the bill Naresh requested Mohan to cancel the bill and drew upon him a new
bill including interest of Rs. 400. Moahn agreed to it. Mohan immediately took the bill from
Raja by making the payment to him and then drew upon Naresh a new bill for 30 days which
was duly met by Naresh on due date. Pass necessary entries in the books of all parties.
Q.36 Calculate gross profit when:
 Total Purchases during the year are Rs. 8,00,000
Return Outward Rs. 20,000
Direct Expenses Rs. 60,000
2/3 of the goods are sold for Rs. 6,10,000
Q.37 Calculate closing stock from the following details:
Rs.
Opening Stock 20,000
Cash Sales 60,000
Credit Sales 40,000
Purchases 70,000
Rate of gross profit on cost 33.33%
Q.38 Prepare Trading and Profit & Loss Account and Balance Sheet as on 31st March,2012, from
the following balances:
Rs. Rs.
Capital 5,00,000 Stock on 1/4/2011 67,000
Drawings 36,000 Salaries & wages 24,000
Bills Receivable 5,800 Outstanding Salaries& wages 2,000
Plant & Machinery 3,80,000 Insurance( including premium of Rs.
Sundry Debtors 58,000 1,000 p.a. paid upto 30/09/12) 2,600
Loan A/C (Cr.) at 12% p.a. 20,000 Cash 46,000
Manufacturing wages 40,000 Bank Overdraft 15,000
Return Inward 3,000 Repairs and Renewals 1,600
Purchases 1,20,000 Interest & Discount 4,400
Sales 2,60,000 Bad-Debts 4,000
Rent 28,000 Sundry Creditors 30,000
Commission received 6,000 Fixtures & fittings 12,000
Adjustments:
1. Stock on hand on 31st March, 2012 was Rs. 80,000.
2. Further Bad debts written off Rs. 2,000 and create a provision of 5% on Sundry Debtors.
3. Rent have been paid upto 31st may 2012.
4. Manufacturing wages include Rs. 10,000 of a new Machinery purchased on 1st October,2011.
5. Depreciate Plant and Machinery by 10% p.a. and Fixtures and fittings by 20% p.a.
6. Commission earned but not received Rs. 1,000
7. Interest on loan for the last 2 months was not paid.
8. Goods worth Rs. 4,000 were distributed as free sample. Provide for Manager’s commission at
10% on Net profit after charging such commission..
Q.39 Subscription received during the year ended March 31, 2006 by Royal Club were as under:
Rs.
2004-2005 3,000
2005-2006 93,000
2006-2007 2,000
The club has 500 members each paying @ Rs. 200 as annual subscription. Subscription
outstanding as on March 31, 2005 were Rs. 8,000. Calculate the amount of subscription to be
shown as income in the Income and Expenditure Account for the year ended March 31, 2006
and show the relevant data in the Balance sheet on 31st March 2005 and 2006.
Q.40 On the basis of the information given below calculate the amount of Stationery to be debited
to the ‘Income and Expenditure Account’ of Good Health Sports Club for the year ended 31st
March 2007:
April1, 2006 March31, 2007
Stock of Stationery 8,000 6,000
Creditors for Stationery 9,000 11,000
Stationery purchased during the year ended 31-3-2007 was Rs. 47,000.
Q.41 From the following Receipt and Payments Account of a club for the year ended 31st
December,2010 and from the information supplied, prepare Income and Expenditure Account
for the year ended 31st December, 2010 and the Balance Sheet as on that date:
Receipts Amount Payments Amount
To Balance b/d 1,50,000 By Salaries 1,50,000
To Subscription: By Entertainment Expenses 60,000
2009 10,000 By Electric Charges 20,000
2010 2,00,000 By General Expenses 30,000
2011 20,000 By Investments 1,00,000
To Entertainment Receipts 1,00,000 By Printing & Stationery 20,000
To Sale of old furniture( By Newspapers 30,000
costing Rs. 10,000) 6,000 By Furniture 30,000
To Sale of News paper 4,000 By Miscellaneous Expenses 20,000
By Balance c/d 30,000

4,90,000 4,90,000
The club has 250 members, each paying an annual subscription of Rs. 1,000. Rs. 5,000 are still in
arrears for subscriptions of 2009. In 2009, ten members had paid their subscriptions for 2010 as well.
Salaries paid include Rs. 10,000 for 2009 and Rs. 15,000 for 2011. Outstanding salaries for 2010
amounted to Rs. 20,000. On 1/1/2010 the club owned Land and Building valued at Rs. 10,00,000 and
furniture valued at Rs. 1,10,000. Interest for 3 months at 6% p.a. has accrued on investment.
Q.42 X keeps incomplete records. Following information is available from his books:
01-04-2006 31-3-2007
Sundry Debtors 30,000 62,000
Stock 64,000 38,000
Loan from wife 15,000 15,000
Sundry Creditors 22,600 16,800
Office Equipments 15,000 12,500
Buildings 60,000 60,000
Cash Balance 2,100 4,500
Bank Overdraft 13,500 25,000
During the year X received Rs. 1,000 per month as pension, of which he invested Rs. 7,500 into the
business. He also sold his private house for Rs. 25,000 and invested this amount into the business.
X withdrew from the business Rs. 1,000 per month upto 31st August, 2006 and thereafter Rs. 2,000 per
month as drawings. In addition, he withdrew from the business Rs. 4,200 for paying Income tax and
Rs. 3,000 to pay the legal expenses in a private suit.
Prepare a statement to ascertain the profit or loss.

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