Pre Board-I 12th Accountancy

Marking scheme
Q.1 (c) Sundry Creditors

Q.2 (c) 30,000

Explanation:
Applicants for 50,000 shares have been allotted 20,000
Hence, Excess Application Money = 30,000 x Rs.3 90,000
Less : Amount adjusted on allotment = 20,000 x Rs.2 40,000
Balance to be adjusted against first call 50,000
Amount due on first call = 20,000 x Rs.4 80,000
Net amount to be recd. on first call 30,000

Or
Q.3 (d) Rs.2,400
Q.3 (a) Rs.20,000

Q.4 Reduction in the value of Furniture = 1,00,000

Reduction in the value of Machinery = 90,000
Net decrease in the value of assets = 1,90,000

Q.5 (c) Rs.90,000

Explanation:
Total Capital of A and B : 90,000 + 60,000 1,50,000
Add : General Reserve 50,000
Less : Advertisement Suspense (20,000)
Total Capital of A & B after adjustments 1,80,000

For 2/3rd Share Combined Capital of A & B = 1,80,000

Total Capital of the firm = 1,80,000 x 3/2 = 2,70,000
C's Capital = 1/3 rd of 2,70,000 = 90,000

Q.6 (d) Dissolution of Partnership firm.

Q.7 (b) Increase in provision for Doubtful Debts

Or
(d) Salary due to a partner of the firm.

Q.8 (c) Rs.6,000

Q.9 (d) Rs.6,750

Q.10 (b) Drawings

Q.11
Date Particulars L.F. Dr. (Rs.) Cr. (Rs.)
Realisation A/c Dr. 40,000
To Shipra's Capital A/c 40,000
 (Being Realisation expenses of Rs.25,000 &
Remuneration of Rs.15,000 Credited to Shipta's
account.)
Note :- Shipra is not liable to bear the realisation expenses.

Q.12 (i) - (c) (ii) - (a) (iii) - (d)

Q.13 (d) Interest at the fixed rate

Q.14 (a) (A) is correct but (R) is wrong.

Q.15 (d) Both (A) and (R) are wrong.

Note : Interest on B's drawings will be charged at Rs.40,000.

Q.16 (c) Cumulative Preference Shares

Q.17 Saroj's Capital A/c Dr. 2,350

Mahinder's Capital A/c Dr. 1,300
To Umar's Capital A/c 3,650

Q.18 "Journal"
Date Particulars L.F. Dr. (Rs.) Cr. (Rs.)
2021 A's Capital A/c Dr. 25,600
Mar.1 B's Capital A/c Dr. 6,400
To Profit and loss A/c 32,000
(Being Accumulated loss transferred to old partner's
Capital accounts on the admission of C)
2021 Reserve A/c Dr. 1,00,000
Mar.1 To A's Capital A/c 80,000
To B's Capital A/c 20,000
(Being Reserve transferred to old partner's Capital
accounts on the admission of C)
2021 Bank A/c Dr. 60,000
Mar.1 To Premium for Goodwill A/c 60,000
(Being premium for Goodwill brought in by C for
1/3rd share.)
2021 Premium for Goodwill A/c Dr. 60,000
Mar.1 B's Capital A/c D. 4,000
To A's Capital A/c 64,000
(Being P4G brought in by C Credited to A along with
1/45 of the goodwill to be contributed by B due to gain
in his profit sharing ratio.)
Working Note :
Old Ratio of A and B = 4:1
New Ratio of A, B and C = 4:2:3

Sacrifice or Gain :
A = 4/5 - 4/9 = 16/45 (S)
B= 1/5 - 2/9 = 1/45 (G)
C= 3/9 Or 15/45 = (G)

Since, B is gaining 1/45 in the profit, therefore, he will also compensate. A proportionately:
For 1/3rd share C brought Rs.60,000 as premium.
 Therefore, B will compensate A by Rs.60,000 x 3/1 x 1/45 = Rs.4,000

Q.19 Books of Motilal Ltd.

"Journal"
Date Particulars L.F. Dr. (Rs.) Cr. (Rs.)
2021 Bank A/c Dr. 10,00,000
Apr.1 To 6% Debenture Application A/c 10,00,000
(Being App. Money recd.)
Apr.1 6% Debenture Application A/c Dr. 10,00,000
To 6% Debentures A/c 10,00,000
(Being App. money transf.)
Apr.1 6% Debenture Allotment A/c Dr. 9,20,000
Loss on issue of Debentures A/c Dr. 1,80,000
To 6% Debentures A/c 10,00,000
To Premium on Redemption of Dep. A/c 1,00,000
(Being Amount due)
Apr.1 Bank A/c Dr. 9,20,000
To 6% Debenture Allotment A/c 9,20,000
(Being Allotment money recd.)
Apr.1 Securities Premium A/c Dr. 50,000
Mr.31 Statement of P&L A/c Dr. 1,30,000
To Loss on Issue of Deb. A/c 1,80,000
(Being Loss on Issue of Deb. written off.)

"Or"
Journal of Moon Ltd.
Date Particulars L.F. Dr. (Rs.) Cr. (Rs.)
2020 Bank A/c Dr. 95,000
Jan.1 To 12% Deb. App. & Allot. A/c 95,000
(Being App. Money recd.)
12% Deb. App. & Allot. A/c Dr. 95,000
Discount on Issue of Deb. A/c Dr. 5,000
To 12% Debentures A/c 1,00,000
(Being Issue of 1,000 : 12% deb. of Rs.100 each at a
discount of 5%)
Dec.31 Debenture Interest A/c Dr. 12,000
To Debenture holders A/c 12,000
(Being Interest due of debentures)
Debenture holders A/c Dr. 12,000
To Bank A/c 12,000
(Being payment of interest)
Statement of P&L A/c Dr. 17,000
To Debenture Interest A/c 12,000
To Discount on Issue of Deb. A/c 5,000
(Being Discount written off)

Dr. Discount on Issue of Debentures A/c Cr.

Date Particulars Rs. Date Particulars Rs.
2020 To 12% Debentures A/c 5,000 2020 By SPL A/c 5,000
Jan.1 Dec. 31
5,000 5,000

Q.20 "Journal"
 Date Particulars L.F. Dr. (Rs.) Cr. (Rs.)
2022 Stock A/c Dr. 70,000
Apr.1 Debenture A/c Dr. 1,40,000
Vehicle A/c Dr. 3,00,000
Office Equipment A/c (Computers) Dr. 1,20,000
To Shruti's Capital A/c 4,70,000
To Premium for Goodwill A/c 1,60,000
(Being Assets contributed by Shruti for her capital and
her share of goodwill premium)
Apr.1 Premium for Goodwill A/c Dr. 1,60,000
To Preeti's Capital A/c 16,000
To Niti's Capital A/c 1,44,000
(Being P&G transferred)
Notes : (1) Shruti's Share of Goodwill = 6,40,000 x 2/8 = Rs.1,60,000

(2) Calculation of sacrificing Ratio = Preeti = 2/5 - 3/8 = 1/40

= Niti = 3/5 - 3/8 = 9/40 (1 : 9)

Q.21 "Journal"
Date Particulars L.F. Dr. (Rs.) Cr. (Rs.)
Realization A/c Dr. 6,000
To K's Capital A/c 6,000
(Being wife's loan discharged by the partner)
Realization A/c Dr. 27,000
To Bank A/c 27,000
(Being Balance Creditors' paid)
K's Capital A/c Dr. 3,000
To Realization A/c 3,000
(Being Unrecorded machine taken over by partner)
R's Capital A/c Dr. 5,000
K's Capital A/c Dr. 5,000
S's Capital A/c Dr. 5,000
To Profit & Loss A/c 15,000
(Being balance of P&L distributed)

Q.22 "Journal"
Date Particulars L.F. Dr. (Rs.) Cr. (Rs.)
(i) Share Capital A/c Dr. 24,000
Securities Premium A/c Dr. 4,000
To Calls - in - Arrears A/c 18,000
To Share forfeited A/c 10,000
(Being 400 shares of Rs.100 each, Rs.60 called
forfeited)
(ii) Bank A/c Dr. 23,000
Share forfeited A/c Dr. 2,000
To Share Capital A/c 25,000
(Being 250 shares re-issued)
(iii) Share Forfeited A/c Dr. 4,250
To Capital Reserve A/c 4,250
(Being Balance of share forfeited trans.)
Note :Share forfeited A/c is credited with Rs.10,000 and only application money @ Rs.25 per share
is paid.
 Hence, Shares forfeited = 10,000 / 25 = 400

Q.23 "Journal of Sukanya Ltd."

Date Particulars L.F. Dr. (Rs.) Cr. (Rs.)
Bank A/c Dr. 13,44,000
To Equity Share Application & Allot. A/c 13,44,000
(Being App. and Allot. money recd.)
Equity share app. and Allot. A/c Dr. 13,44,000
To Equity Share Capital A/c 3,84,000
To Security Premium A/c 9,60,000
(Being App. money adjusted)
Equity Share first call A/c Dr. 7,68,000
To Equity Share Capital A/c 2,88,000
To Securities Premium A/c 4,80,000
(Being first Call money due)
Bank A/c Dr. 7,12,000
To Equity Share first Call A/c 7,12,000
(Being first call money recd.)
Equity Share second & Final Call A/c Dr. 7,68,000
To Equity Share Capital A/c 2,88,000
To Securities Premium A/c 4,80,000
(Being Second & final call money due)
Bank A/c Dr. 6,72,000
To Equity Share second & final call A/c 6,72,000
(Being final call money recd.)
Equity Share Capital A/c Dr. 1,20,000
Security Premium A/c Dr. 95,000
[(7,000 x Rs.10) + (5,000 x Rs.5)]
To Equity Share first call A/c 56,000
To Equity share second & final Call A/c 96,000
To Forfeited shares A/c 63,000
(Being Shares forfeited)
Bank A/c Dr. 64,000
Forfeited Shared A/c Dr. 16,000
To Equity Share Capital A/c 80,000
(Being shares Re-issued)
Forfeited shares A/c Dr. 19,000
To Capital Reserve A/c 19,000
(Being Balance of Forfeited shares transf.)
Notes : (1) Cal. of Gain on re-issue of forfeited shares:
Amount forfeited on 7,000 Shares of Rohit 28,000
Amount forfeited on 1,000 shares of Namit (35,000 x 1000/5000) 7,000
35,000
Less : Reissue discount (8,000 x Rs.2) 16,000
19,000
Q.24 Realisation A/c
Particulars Rs. Particulars Rs.
To Fixed Assets 9,00,000 By Creditors 1,50,000
To Debtors 2,80,000 By Bank Loan 40,000
To Investments 30,000 By Workmen Compensation
To Stock 1,40,000 Reserve 24,000
To Patents 10,000 By Cash A/c
 To P/P Expenses 12,100 (Assets Realised) :
To Cash A/c (Bank Loan) 40,900 Fixed Assets 10,80,000
To Cash A/c (W.C.) 24,000 Debtors : 2,30,000
To X's Capital A/c (Rem.) 25,000 Unrecorded : 16,000
To Capital Accounts : 13,26,000
X : 64,000 13,26,000 50,000
Y : 48,000 By X's Loan A/c (Invest.)
Z : 16,000 1,28,000
15,90,000 15,90,000

Q.25 "Quick Ltd."

Date Particulars L.F. Dr. (Rs.) Cr. (Rs.)
2021 Bank A/c Dr. 9,00,000
Apr.1 To 12% Deb. App. & Allot. A/c 9,00,000
(Being App. Money recd.)
Apr.1 12% Deb. App. & Allot. A/c Dr. 9,00,000
Loss on Issue of Debentures A/c Dr. 1,50,000
To 12% Debentures A/c 10,00,000
To Premium on Redemption of Debentures A/c 50,000
(Being Allot. of 10,000: 12% deb. issued at 10%
discount redeemable at 5% prem.)
2022 Statement of P&L A/c Dr. 1,50,000
Mar.31 To Loss on issue of Deb. A/c 1,50,000
(Being Loss written off)

12% Debentures A/c

Date Particulars Rs. Date Particulars Rs.
2022 To Balance c/d 10,00,000 2021 By 12% Deb. App. & 9,00,000
Mar.1 Apr.1 Allot. A/c
Apr.1 By Loss on Issue of 1,00,000
Deb. A/c
10,00,000 10,00,000

Loss on Issue of Deb. A/c

Date Particulars Rs. Date Particulars Rs.
2021 To 12% Deb. A/c 1,00,000 2022 By Statement of P&L 1,50,000
Apr.1 To Prem. on Red. A/c 50,000 Mar.31 A/c
1,50,000 1,50,000

Q.26 (i) Partner's Capital A/c

Particulars Karan Vijay Shrey Particulars Karan Vijay Shrey
To P & L A/c 4,000 3,000 - By Balance b/d 40,000 30,000 -
To Balance c/d 48,000 36,000 - By Shrey's Current 4,000 3,000 -
a/c 8,000 6,000 -
By prem. for
Goodwill
52,000 39,000 - 52,000 39,000 -

By Balance B/d 48,000 36,000 -

To Balance c/d 48,000 36,000 42,000 By Bank A/c (2) - - 42,000
(ii) Cash at Bank on the date of shrey's admission is Rs.71,000 as per working Note No.3
 Working Notes :
(i) Since new profit sharing ratios are not given, old profit sharing ratio will be considered as
sacrificing ratio.
Adjustment Entry for General Reserve :

Shrey's Current A/c (21,000 x 1/3) Dr. 7,000

To Karan's Capital A/c (7,000 x 4/7) 4,000
To Vijay's Capital A/c (7,000 x 3/7) 3,000
(ii) Total Capital of Karan and Vijay (after all adjustments) :
Rs.48,000 + Rs.36,000 = 84,000
Thus for 2/3rd Share of profits, Capital is = 84,000
Total Capital of the Firm = 84,000 x 3/2 = 1,26,000

Shrey's Capital for 1/3rd Share - 1,26,000 x 1/3 = 42,000

(iii) Calculation of Balance at Bank :

Existing Bank = 15,000
Add. : Amount brought in by Shrey as goodwill = 14,000
Amt. brought in by shrey as capital = 42,000
71,000
PART= B
Q.27 (b) 2.5 : 1

Q.28 (b) Rs. 11,00,000

Explanation :
Proprietary Ratio = Shareholder's Funds
Total Assets
Or 0.8 = 7,00,000 + 3,00,000
Total Assets
Total Assets = 10,00,000 = 12,50,000
0.8
Fixed Assets = Total Assets - Current Assets
= 12,50,000 - 1,50,000
= Rs.11,00,000

Q.29 (b) 26%

Or
(b) Statement of profit and Loss

Q.30 Cash flow from investing activities will be nil since X Ltd. is a finance company.

Q.31
Items Headings Sub-Headings
(i) Balance of the Statement of P&L Shareholder's Funds Reserves and Surplus
(ii) Loans Payable after 3 years Non-Current Liabilities Long-term Borrowings
(iii) Short-term deposits payable on Current Liabilities Short-term Borrowings
demand
(iv) Trade marks Non-current assets Intangible Assets
(v) Provision for warranties Non-Current Liabilities Long-term provisions
(vi) Capital Advances Non-Current Assets Long-term loans and
advances
Q.32 Profit earned during the year Rs.9,00,000 will be Cash flow from Operating Activities.
Current Liabilities 70,000
Short-term Borrowings 90,000
Outstanding Expenses 20,000
1,80,000

Current Ratio = Current Assets

Current Liabilities
2.5 = Rs. 1,80,000 x 2.5 = Rs. 4,50,000

Q.33 Net Assets or Capital Employed Turnover Ratio

= Revenue from Operations (Net sales)
Net Assets (Or Capital Employed)

Net Assets = Non - Current Assets + Working Capital

Non-Current Assets = Plant & Machinery + Intangible Assets
+ Non-current Investments
= Rs.1,80,000 + 20,000 + 40,000 = Rs.2,40,000.
Working Capital = Inventory + Trade Receivable + Cash & Cash Equivalents - Trade Payables.
= Rs. 1,50,000 + 1,00,000 + 40,000 - 30,000
= Rs. 2,60,000
Net Assets = Rs. 2,40,000 + 2,60,000 = 5,00,000
Revenue from Operations = 12,80,000 x 125/100 = 16,00,000

Net Assets Turnover Ratio = 16,00,000

5,00,000
= 3.2 Times

Q.34 Cash Flow Statement

For the year ended 31st March, 2021
Particulars (Rs.) (Rs.)
(A) Cash flow from Operating Activities:
Net Profit before Tax (Note 1) 36,000
Adjustments for non-cash & non-operating items:
Add : Depreciation on machinery 8,000
Interest on long-term borrowings (Debentures) 5,000
49,000
Operating profit before working capital changes
Add : Increase in Current Liabilities Trade Payable 16,000
65,000
Less : Increase in current Assets Inventories 37,000
Net Cash flow from Operating Activities 28,000 28,000

(B) Cash flow from Investing Activities :

Purchase of Machinery (Note 2) (22,000)
Purchase of Non-Current Investment (10,000)
Net Cash used in Investing Activities (32,000) (32,000)

(C) Cash Flow from financing Activities

Proceeds from issue of Equity Share Capital 10,000
Interest paid an Long-term borrowings (Deb.) (5,000)
5,000 5,000
Net Increase in Cash & Cash Equivalents 1,000
 (A+B+C)
Add : Cash & Cash Equivalent in the beginning 25,000
Cash & Cash Equivalent at the end of year 26,000

Working Notes :-
(i) Cal. of Net Profit before Tax :
Net Profit for the Current Year (Rs.14,000 + Rs.12,000) = 26,000
Add : Transfer to General Reserve = 10,000
36,000
(ii) Machinery A/c
Particulars Rs. Particulars Rs.
To Balance b/d 84,000 By Depreciation 8,000
To Bank (Purchase) 22,000 By Balance C/d 98,000
(B/f)
1,06,000 1,06,000

(iii) Cash and Cash Equivalents 2021 (Rs.) 2022 (Rs.)

Cash & Bank Balance 8,000 5,000
Current Investments 18,000 20,000
26,000 25,000