Accounts XII

Instructions as per paper style

Q1. Amit and Vinod are partners in a firm sharing profit and losses in the ratio of 3 : 1. On 1/1/20222
they admitted Raman as a partner. On Rahman’s admission the profit and loss account of Amit and
Vinod showed a debit balance of Rs. 40,000. It will be ___________(1).

Q2. Subscribe Capital is

a. That part of authorised capital which is issued to the public or subscription.

b. That part of issued capital which has been actually subscribe by the public.
c. That part of subscribed capital which has been called up on the shares.
d. That part of subscribed capital which has not yet been called up on the shares.

Q3. Guarantee is given to partner by some of the partners, deficiency on such guarantee is born by

a. All of the other partners

b. Partnership firm
c. Partners who gave the guarantee
d. None of the partners

Q 4. What is meant by Purchased Goodwill?(1)

Q5. Assertion (A) : contingent liabilities are not the liabilities payable yet but may become liabilities
when an event associated with it happens in future.

Reason (R) proposed Divided is a Contingent liability because it will become a liability after the
shareholders declare,i.e. approve it.(1)

a. Assertion angries and product but the reason is not the correct explanation of assertion.
b. Book a version and regional correct and reason is the correct explanation of assertion.
c. Only assertion is correct
d. Both assertion and reason are not correct.

Q6. Which of the following is not correct?(1)

a. Equity = Capital Employed + Debt

b. Equity = share capital + Reserve and surplus
c. Debt. = Long term Borrowing + Long term Provision
d. Working Capital = Current Assets – Current Liabilities.

Q7 . In a company's balance sheet provision for employees benefit to be settled within 12 months is
shown under (1)

a. Non current liabilities

b. Current liabilities
c. Non current Assets
d. Current Assets

Q 8. How is the amount due to an outgoing partner dealt with in case it is not paid immediately. (1)
Q9. Answer the following. (3)

a. Write two external users of financial statement analysis.

b. What are the contingent liabilities?
c. Vinod limited is showing the following balances:
1st April 2020. Capital Reserve. Rs. 2,00,000
Security Premium Rs. 2,50,000
Surplus i. e. Statement of P&L.
Rs. 100,000
31st March 2021 Loss during the year Rs. 5,00,000

Prepare notes to account on Reserves and surplus showing the amount to be carried to
the balance sheet.

Q 10. Abhay and Bina are partners in a firm. They admitted Charan as a partner
with 1/4th share in the profit of the firm. Charan brings Rs.2,00,000 as his share of
capital. Value of the total assets of the firm is Rs.5,40,000. Outside liabilities are
valued Rs. 1,00,000 on that date. Give necessary entry to record Goodwill at the
time of Charan admission. Also show your working notes. (3)
Q11. X ,Y and z are sharing profits and losses in the ratio of 5:3:2. Did decided to
share future profits and losses in the ratio of 2:3:5 with effect from first April
2022. They also decided to record the effect of the following revaluations without
affecting the book values of the assets and liabilities by passing an adjustment
entry. (3)
Book value. Revised value. Rs.
Rs.
Land and building. 5,00,000. 5,50,000
Plants and machinery. 2,50,000. 2,40,000
Sundry creditor. 60,000. 55,000
Outstanding expenses. 60,000. 75,000
Pass necessary single adjustment entry with working notes.
Q 12. Aman and Babul are partners sharing profit in the ratio of 3:2, with capitals
of Rs. 50,000 and Rs 30,000 respectively. Interest on capital is agreed at the rate
of 6% per annum. Babul is to be allowed an annual salary of Rs. 2,500. During the
year 2019-20, the profits prior to the calculation of interest on capital but after
charging Babul's salary amounted to Rs.12,500. A provision of 5% of the profit is
to be made in respect of commission to the manager.
Prepare profit and loss appropriation account with proper working notes. (3)
Q13. A firm has current ratio = 4.5 : 1
Quick Ratio. =. 3 : 1
Inventory. = Rs. 36,000
Calculate current Assets and current liabilities. (4)
Q14. Raman, Karan and Chaman were partners in a firm sharing profit and losses
in the ratio of 2:3:1.with effect from first April 2018 they decided to share future
profits and losses in the ratio of 3:2: 1.on that date their balance sheet showed a
debit balance of Rs 24,000 in the profit and loss account and a balance of Rs.
1,44,000 in general reserve.
It was also agreed that:
a. The Goodwill of the firm be valued at Rs.1,80,000.
b. The land (having book value of Rs. 3,00,000) will be valued at Rs. 4,80,000.
Pass the necessary journal entries for the above changes. (4)
Q15 . Meena and Meena are partners in firm sharing profit in the ratio of 5:2. On
first April 2020 there balance sheet was as follows:
Balance balance sheet of Meena and Meena as on April 1, 2020.
Liabilities Amount Assets Amount
Meena’s Bank 10,000
Capital 80,000 Stock 20,000
Meena’s Debtors 30,000
Capital 70,000 Plant &
Creditors 30,000 Machinery 40,000
Building 80,000
1,80,000 1,80,000

On the above date, the admitted Leena as a new partner on the following terms:
a. That the new profit sharing ratio will be 2:3:3.
b. That Leena will bring rupees 10 lakh for her capital and the necessary amount
of goodwill premium in cash.
c. Goodwill of the form is valued at Rs. 1,40,000.
Record the necessary journal entries in the books of the firm on Leena’s
Admission. show your working clearly. (4)
Q16. Mitali , Indu and Geeta are Partners sharing profits and losses in the ratio of
5:3:2 respectively. On March 31st 2020 their balance sheet was as under:
Liabilities Amount Assets Amount
Sundry creditor 55,000 Goodwill 25,000
Reserve Fund 30,000 Building 1,00,000
Capital Patent 30,000
Machinery 1,50,000
Mitali. 1,50,000 Stock 50,000
Indu. 1,25,000 Debtors 40,000
Geeta. 75,000 3,50,000 Cash 40,000

4,35,000 4,35,000
Geeta retires on the above date. Goodwill of the palm is valued at rupees 1,25,000.

Record necessary journal entries on ‘s retirement, assuming that Goodwill is to be adjusted through
partners capital account. (4)

Q17. (a)Calculate revenue from operations other income and total revenue for a non financial company
from the following information with proper format of statement of profit and loss account.

Sales Rs 12,00,000 ; Sales return Rs. 2,00,000. ; Sale of Scrap Rs. 25,000; interest on Fixed Deposits Rs.
30,000; Dividend Earned Rs. 10,000.(2)

(b) Differentiate between Intra firm and Inter firm analysis. (2)

Q18. From the following details given below calculate following ratios:. (6)

a. Gross profit ratio. B. Stock turnover ratio. C. Operating ratio. D. Debtors turnover ratio
Revenue from Operations. Rs. 1,50,000
Opening inventory. Rs. 29,000
Closing inventory. Rs. 31,000
Cost of revenue from operations Rs. 1,20,000
Operating expenses. Rs. 16,000
Trade receivables. Rs. 16000
Net Fixed Assets. Rs. 1,10,000

Q19.XY Ltd. Issued 1,000 shares of Rs. 10 each at a premium of 50% per share payable as follows:
On Application Rs. 6 per share (including premium RS. 2)

On Allotment Rs. 3 along with premium RS. 2

On First Call Rs. 2 per share along with remaining premium

Balance on 2nd call. All the shares were applied for and duly alloted. Pass the necessary journal entries.
(6)

Q20. Sonu and Rajat started partnership firm on first April 2019. They contributed rupees 8,00,000 and
Rs. 6,00,000 respectively as their capital and decided to share profit and loss in the ratio of 3:2. The
partnership deed provided that Sonu was to be paid salary of Rs 20,000 per month and Rajat a
commission of 5% on turnover. It also provided that interest on capital be allowed at the rate of 8% per
annum. Sonu withdrew rupees 20,000 on 1st December and Rajat withdrew Rs. 5000 at the end of each
month. Interest on drawing was charged @ 6% per annum. The neck profit as per profit and loss account
for the year ending 31st March 2020 was Rs. 4,89,950. The turnover of the firm for the year ended 31 st
March, 2020 amounted to Rs. 20,00,000.

Prepare Profit and loss Appropriation account and show your working clearly. (6)

Q21. Anne and Honey var partners in a firm sharing profit in the ratio of 3:2. On first April 2020 their
balance sheet was as follow:

Balance sheet of Anny and Honey as on April 1, 2020

Liabilities Amount Assets Amount

Creditors 17,000 Cash 6,000
General reserve 4,000 Debtors 15,000
Workmen compensation Fund 9,000 Investment 20,000
Investment Fluctuation Fund 11,000 Plant 14,000
Provision for bad debts 2,000 Land and building 38,000
Capitals:
Anne. 30,000
Honey. 20,000 50,000
93,000 93,000

On the above date Veena was admitted for 14th share in the profit of the firm on the following terms:

a. Veena will bring rupees 20,000 for her capital and Rs.4,000 for her share of goodwill premium.
b. All debtors were considered good.
c. The market value of investment was rupees 15000.
d. There was a liability of rupees 6000 for workmen compensation.
e. Capital accounts of Anne and Honey are to be adjusted on the basis of Veena's capital by
opening current account
Prepare revaluation account, partners capital account and Balance sheet of the firm after
Veena’s Admission. (6).

Q22. A ,B and C were partners in a firm sharing profit and losses in proportion to their capitals. Their
balance sheet as at 31st March 2019 was as follows:
 BALANCE SHEET OF A B AND C

As at 31st March, 2019

Liabilities Amount Assets Amount

Capitals: Land and Building 5,00,000
A. 2,00,000 Investment 1,20,000
B. 2,00,000 Debtors. 1,50,000
C. 1,00,000 5,00,000 Less:Pro. For D. D. 10,000 1,40,000
Investment Fluctuation Fund 40,000 Stock 1,00,000
General Reserve 30,000 Cash at Bank 1,70,000
Creditors 4,60,000
10,30,000 10,30,000

On the above date, A retired from the firm and the remaining partners decided to carry on the business.
It was agreed to revalue the assets and reassess the liabilities as follows:

a. Goodwill of the firm was valued at Rs 3,00,000 and A's share of goodwill was adjusted in the
capital accounts of the remaining partners.
b. Land and Building was to be brought upto 120% of its book value.
c. Bad debts amounted to Rs. 20,000. A provision for doubtful debts was to be maintained at 10% on
debtors.
d. Market value of investment was Rs 1,10,000.
e. Rs 1,00,000 was paid immediately by cheque to A out of the amount due and the balance was to
be transferred to his loan account which was to be paid in two equal annual installments along
with interest @ 10% p a.

Prepare the Revaluation account, Partners’ Capital Account and the balance sheet of the reconstituted
firm on A’s retirement.

Q23. From the following information, calculate (8)

a. Gross Profit Ratio

b. Inventory Turnover ratio
c. Current Ratio
d. Net Profit Ratio
e. Working Capital Turnover Ratio

Revenue from operations 25,20,000 Average Inventory. 8,00,000

Net Profit. 3,60,000 Current Assets (offer then Inventory. ) 7,60,000
Cost of Revenue from operations. 19,20,000 Property, Plant and Equipment. 14,40,000
Long – term Debts 9,00,000 Current Liabilities 6,00,000
Trade Payable 2,00,000 Net Profit before Interest and Tax. 8,00,000