CBSE XI | Accountancy

Sample Paper – 5 – Solution

CBSE
Class XI Accountancy
Sample Paper - 5

Part A

Answer 1
The Objectives of Accounting are as follows:

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i. Maintaining correct records of business transactions.
ii. Knowing about the sources of revenue and also, the expenditure.
iii. Ascertaining the profit or losses of the business.

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Answer 2
A cash book is a type of subsidiary book which records only cash and bank transactions in
chronological order. All receipts in cash (including cheque) are recorded on the debit side,
whereas all payments in cash (including cheque) are recorded on the credit side of the cash
book.

Answer 3
ID
The given statement is incorrect as Fixed Assets and Current Assets are different based on
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the following:
Fixed assets are those assets of the business enterprise which are not meant for sales in
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the near future but are used throughout the period in order to fetch benefit out of it.
Current assets on the other hand, are those assets of the business enterprise which are
meant for sales or converted into cash within one year.

Answer 4
D

The rules for debit and credit are same for both liabilities and capital because business and
the owner both are considered as separate entities as per the business entity concept.
U

Answer 5
Consistency Assumption states that accounting policies and practices followed by an
ST

enterprise should be uniform and consistent over a period of time. It helps in better
understanding of accounting information and makes the information comparable with that
of previous years.

Answer 6
Calculation of Net income on basis of Cash transactions

Sale (WN 1) Rs. 6,00,000

Less expenses (WN2) Rs. 3,50,000
Income Rs. 2,50,000

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 CBSE XI | Accountancy

Sample Paper – 5 – Solution

Working notes:
WN 1- Cash sales of Rs. 6,00,000 is considered and credit sales of Rs. 3,00,000 is ignored
WN 2- Expenses during the year is Rs. 5,00,000 in total, out of which Rs. 1,50,000 is still
pending
i.e.Rs. 5,00,000 − Rs. 1,50,000 = Rs. 3,50,000

Answer 7
Cash Basis of Accounting records a transaction based upon inflow and outflow of cash. And
as far as business of Dr. Khan is concerned, he is in a profession where he receives his fees

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immediately after providing the consultation services. Accordingly, the currently followed
cash basis of accounting is good to follow.

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Answer 8
In the given question, short posting of Rs. 200 to Salary A/c is nullified by excess Rs. 200
posted to the Administration Expenses A/c. Therefore, it is a compensating error.
(Hint: Compensating Error is the type of error whose effect is nullified by another error
committed of equal amount, i.e. when two or more errors occur in such a way that the net

ID
effect of these errors on the debits and credits of respective accounts is nil.)

Answer 9
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Revenue is an amount earned as a result of sale of goods or rendering of services. It is sum
of cash and credit sales.
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Answer 10
It would be recorded with Rs. 1,50,000 (Gross Amount less Trade Discount)
The entry to record this sale would be:
(i) On the date of Sale:
Kalyan Sports A/c Dr. 1,50,000
D

To Sales A/c 1,50,000

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(ii) On the date of receipt of amount

Cash A/c Dr. 1,47,000
Discount Allowed A/c Dr. 3,000
ST

To Kalyan Sports A/c 1,50,000

Answer 11
A Capital Expenditure is that type of expenditure the benefit of which extends to several
accounting years. Expenditure incurred on the acquisition of fixed assets like Land and
Building, Machinery, Patents and Copyrights etc., are some examples of Capital
Expenditure.

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 CBSE XI | Accountancy

Sample Paper – 5 – Solution

Answer 12
(i) Cash Memo
(ii) Invoice

Answer 13
Rebate is a reduction in the price of the goods after the goods have been sold and is offered
for reasons other than that which may have been for allowing trade discounts (say, bad
quality products delivered). It is offered and allowed on sales completed in the past.

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Answer 14
Name of Accounts Consequence of Nature of Account
decrease

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(i) Adi (Proprietor) Debit Capital
(ii) Fright A/c Credit Expense
(iii) Cartage A/c Credit Expense
(iv) Salary Outstanding A/c Debit Liability
(v) Jay (Supplier) Debit Liability
(vi) Karan (Customer) ID
Credit

OR
Asset
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In the books of Ajay
Journal
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Sr. Debit Credit

Particulars L.F.
No. (Rs.) (Rs.)

1. Bank A/c Dr. 48,000

Discount Allowed A/c Dr. 2,000
D

----To Vijay A/c 50,000

(Being the cheque received from Vijay and allowed
discount)
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2. Purchased A/c Dr. 30,000

ST

----To Bank A/c 29,100

----To Discount Received A/c (30,000 3%) 900
(Being the goods purchased against cheque and
discount availed.)

3. Cash A/c Dr. 20,370

Discount Allowed A/c (21,000  3%) Dr. 630
-----To Sales A/c 21,000
(Being the goods sold against cash allowing 3%
discount.)
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Sample Paper – 5 – Solution

Answer 15
Journal
Sr. Debit Credit
Particulars L.F.
No. (Rs.) (Rs.)

(i) Ramesh’s A/c Dr. 500

----To Sales A/c 500
(Being a credit sale omitted to be recorded, now

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recorded)

(ii) Suresh’s A/c Dr. 500

----To Furniture A/c 500

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(Being a credit sale of furniture omitted to be
posted, now posted)

(iii) Drawings A/c Dr. 1,000

----To Purchases A/c 1,000
ID
(Being goods taken away by the proprietor omitted
to be recorded, now recorded)
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(iv) Advertisement A/c Dr. 2,000
----To Purchases A/c 2,000
(Being goods distributed as free samples omitted to
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be recorded, now recorded)

Answer 16
Trading Account
D

For the year ended March 31,2017

Dr. Cr.
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Particulars Rs. Particulars Rs.

To Purchases (Adjusted) 4,40,000 By Sales 5,64,000
To Freight and Carriage Inwards 5,400
ST

To Wages 5,000
To Gross Profit c/d (Bal. Fig.) 1,13,600
5,64,000 5,64,000
Note:
1. Freight and Carriage Outwards are not a Direct Expense. Thus, it is not recorded in the
trading Account.
2. Adjusted Purchases = Opening Stock + Net Purchases – Closing Stock
Therefore, Closing Stock (Rs. 45,600) is not considered while preparing Trading Account.

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 CBSE XI | Accountancy

Sample Paper – 5 – Solution

OR
Corrected Trial Balance
Trial Balance
Debit Balances Rs. Credit Balances Rs.
Opening Stock 10,260 Creditors 8,400
Returns Inwards 900 Rent Received 900
Salaries 3,600 Bills Payable 6,000
Bank 13,500 Capital 16,560

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Carriage Inward 1,800 Return Outwards 4,800
Discount Allowed 600 Discount Received 1,200
Purchases 30,000 Sales 42,000
Debtors 4,500

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Carriage Outwards 1,500
Machinery 5,400
Trade Expenses 1,800
Building 6,000
79,860 79,860

Answer 17
ID
Statement of Affairs
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as on 31.03.16
Amount Amount
Liabilities Assets
(Rs.) (Rs.)
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Loan from friend 20,000 Cash 24,000

Creditors 16,000 Bank 50,000
Capital (Balancing Figure) 98,000 Debtors 36,000
Furniture 16,000
Stock 8,000
1,34,000 1,34,000
D
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Statement of Affairs
as on 31.03.17
ST

Amount Amount
Liabilities Assets
(Rs.) (Rs.)
Cash 5,000
Creditors 10,000 Bank 9,600
Loan 15,000 Debtors 34,200
Capital (Balancing Figure) 56,080 Furniture 17,280
Stock 15,000
81,080 81,080

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Sample Paper – 5 – Solution

Statement of Profit or Loss

for the half year ended 31.03.17
Amount
Particulars
(Rs.)
Capital at the end of the year 56,080
Add: Drawings made during the year 9,600
Less: Additional capital introduced during the year -
Adjusted capital at the end of the year 65,680

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Less: Capital in the beginning of the year 98,000
Net Loss 32,320

Answer 18

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Money measurement Concept: It states that in accountancy only those transactions would
be recorded which have some monetary value. If a transaction has kept importance but
cannot be expressed in terms of money, it cannot be recorded at all. For instance if
manager of a company fell ill and due to his illness company suffered a loss, then his illness

money but loss would be recorded. ID

being an important factor will not be recorded because it cannot be expressed in terms of

Honesty and respect for law are the values considered by a businessman while following
Money measurement Concept.
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Answer 19
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In the books of Rushi

Journal
Debit Credit
Date Particulars L.F.
(Rs.) (Rs.)
April 1
D

Bills receivable A/c Dr. 4,000

----To Shashi A/c 4,000
(Being acceptance received from Shashi for
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mutual accommodation)
ST

April 1 Bank A/c Dr. 3,920

Discount A/c (4,0006%4/12) Dr. 80
----To Bills receivable A/c 4,000
(Being bill discounted for Rs.3,920)

April 1 Shashi A/c Dr. 2,000

----To Cash A/c 1,960
----To Discount A/c 40
(Being 50% of proceeds remitted to Shashi )

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 CBSE XI | Accountancy

Sample Paper – 5 – Solution

Aug 1 Shashi A/c Dr. 7,000

----To Bills payable A/c 7,000
(Being acceptance given to Shashi, being unable
to remit the due amount)

Bank A/c Dr. 1,300

Discount A/c [40 (2,000 + 1,300)/660] Dr. 200
----To Shashi A/c 1,500

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(Being amount received from Shashi and
discount amount credited to him)

Bills payable A/c Dr. 7,000

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----To Shashi A/c 7,000
(Being acceptance to Shashi dishonoured
because of insolvency)

Shashi A/c Dr. 3,500

----To Bank A/c (3,500  0.25)
----To Deficiency A/c
ID
(Being amount paid @25 paise in a rupee and
875
2,625
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balance credited to deficiency account as being
unable to pay)
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OR

Purchases Book
Name of Supplier Invoice Details
Date L.F. Rs.
D

(Account to be credited) No. Rs.

2017
Jan 01 Harish 7,800
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Jan 02 Mangal 7,000

Jan 04 Devi Dayal 3,250
ST

Jan 07 Devi Dayal 7,000

Jan 09 Raghu Nath 9,000
Purchases A/c Dr. 34,050

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 CBSE XI | Accountancy

Sample Paper – 5 – Solution

Sales Book
Name of Customer Invoice Details
Date L.F. Rs.
(Account to be debited) No. Rs.
2017
Jan 01 Ravi 5,250
Jan 02 Dina Nath 5,500
Jan 04 Zakir Hussain 3,500
Jan 06 Ram Saran 5,000

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Jan 06 Ghanshyam 3,000
Jan 10 Raja Ram 4,750
Sales A/c Cr. 27,000

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Purchases Return Book
Name of Supplier Debit Details
Date L.F. Rs.
(Account to be debited) Note No. Rs.
2017
Jan 04
Jan 08
Mangal
Devi Dayal
Purchases Return A/c
ID Cr.
1,000
750
1,750
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Sales Return Book
Name of Customer Credit Details
Date L.F. Rs.
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(Account to be credited) Note No. Rs.

2017
Jan 02 Ravi 750
Jan 05 Zakir Hussain 450
Jan 07 Ram Saran 500
D

Sales Return A/c Dr. 1,700

Answer 20
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Statement of Affairs
As on April 01, 2016
ST

Liabilities Rs. Assets Rs.

Sundry Creditors 20,000 Cash 6,000
Bills Payable 15,000 Sundry Debtors 68,000
Capital (Balancing Fig.) 1,13,000 Stock 59,000
Furniture 15,000
1,48,000 1,48,000

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 CBSE XI | Accountancy

Sample Paper – 5 – Solution

Statement of Affairs
As on March 31, 2017
Liabilities Rs. Assets Rs.
Sundry Creditors 18,000 Cash 7,000
Bill Payable 11,000 Stock 87,000
9% Loan from Friend 20,000 Furniture 13,500
Add : Interest
Outstanding

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(20,000 × 9% × 6/12) 900 20,900 Sundry Debtors 64,000
Less : 5% Provision
Capital (Balancing Fig.) 1,18,400 for Doubtful Debts (3,200) 60,800
1,68,300 1,68,300

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Statement of Profit or Loss
For the year end March 31, 2017
Particulars Rs.
Capital as on March 31, 2017
Add: Drawings (Rs. 2,500 × 12)

Less: Capital as on April 01, 2016

ID 1,18,400
30,000
1,48,400
(1,13,000)
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Profit made during the year 2016-2017 35,400
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Answer 21
Financial statement of Aaditya Ltd.
Trading Account
For the year ended 31st March 2017
Dr. Cr.
D

Particular Rs. Particulars Rs.

To Opening Stock 57,600 By Sales 9,87,800
To Purchase 4,06,750 Less: Return (6,800) 9,81,000
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Inwards
Less: Return Outwards (5,000) 4,01,750 By Closing Stock 68,000
ST

To Carriage On Purchase 20,400

To Fuel and Power 47,300
To Wages 1,04,800
Less: Building (20,000) 84,800
To Gross Profit c/d 4,37,150
(Balancing Fig.)
10,49,000 10,49,000

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 CBSE XI | Accountancy

Sample Paper – 5 – Solution

Profit and Loss Account

For the year ended 31st March 2017
Dr. Cr.
Particulars Rs. Particulars Rs.
To Carriage on Sales 32,000
To Depreciation on Machinery 20,000 By Gross Profit 4,37,150
b/d
To Amortization of Patents 15,000
To Insurance 6,000

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Less: Prepaid Insurance
(1,7006/12) (850) 5,150
To General Expenses 30,000

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To Salaries 1,50,000
Add: Outstanding Salaries 15,000 1,65,000
To Provision For Doubtful 7,250
Debts
To Net Profit c/d 1,62,750
(Balancing Fig.)
ID 4,37,150 4,37,150
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Balance Sheet
as on 31st March 2017
Liabilities Rs. Assets Rs.
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Capital 7,10,000
Add: Net profit 1,62,750 Freehold Land 1,00,000
Less: Drawings (52,450) 8,20,300 Machinery 2,00,000
Less: 10% (20,000) 1,80,000
Depreciation
D

Sundry creditors 63,000 Patents 75,000

Salaries outstanding 15,000 Less: 20% (15,000) 60,000
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Amortization

Prepaid Insurance 850

ST

Closing stock 68,000

Sundry debtors 1,45,000
Less: provision for
doubtful debts (7,250) 1,37,750
Building 3,00,000
Add: Wages 20,000 3,20,000
Cash in hand 5,400
Cash at bank 26,300
8,98,300 8,98,300

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 CBSE XI | Accountancy

Sample Paper – 5 – Solution

Note: adjustment no (iv) is Capital expenditure but include in wages. Therefore, Rs. 20,000
is reduced from Wages and added in Building.
OR
Bank Reconciliation Statement
as on31st March
+ –
S. No. Particulars
(Rs.) (Rs.)
Debit Balance as per Cash Book 39,570

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(i) Cheque deposited on 27th March but not yet collected till 31st March 7,500
(ii) Cheques deposited on 26th March but not yet collected till 31st March 1,000
Cheques issued on 26th March but not yet presented for payment till
(iii) 31st March 2,500

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Cheque issued on 25 March but not yet presented for payment till
th

(v) 31st March 17,000

(v) A Cheque entered in Cash Book but not yet banked 1,000
(vi) A Cheque deposited into bank but not yet entered in Cash Book 600
(vii) Discounted BIR dishonoured, not yet entered in Cash Book 520
(viii) Rebate on bill not entered in cash book

(x)
ID
Cheque drawn on Saving Bank Account but recorded in current
Account
150

200
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Credit Balance (Overdraft) as per Cash Book (60,020 – 10,020) 50,000
60,020 60,020
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Note: (ix) A cheque of Rs. 1,080 credited in Pass book on March on March 28, later debited
in Pass Book on 1st April has no effect on Bank Reconciliation Statement as at 31st March.

Part B
D

Answer 22
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Importance of Trading Account:

i. Provides information about the direct expenses incurred on the purchase and
manufacturing of goods.
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ii. Provides information about Gross Profit and Gross Loss as a result of buying and selling
the goods during the year.

Answer 23
Option A: Selling and Distribution Expenses

Answer 24
Option D: Capital Expenditure

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Sample Paper – 5 – Solution

Answer 25
Option C: Operating Profit

Answer 26
Customised software is the one which allows to makes changes in the ready to use software
so as to suit the specific requirements of the user.

Answer 27
Option D: A tangible fixed asset

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Answer 28
Option B: A current asset

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Answer 29
Steps in designing the accounting report are as follows:
1. Determining the objectives of the reports that clearly specify the type of users and the
type of decisions taken based on such reports.

ID
2. Presenting the report in a proper format that comprising complete details.
3. Specifying the various accounting information queries which are helpful in
manipulating the database.
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4. Finalising the report with a complete analysis and necessary suggestions of its study.

Answer 30
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Based on the information given in the question, Rahul is not correct in preparing Trial
Balance and Final Accounts from the records maintained under Single Entry System of
Accounting because such system is subject to the following disadvantages:
i. Trial Balance cannot be prepared: Under this system, complete information of the
transactions is not recorded and therefore, no trial balance can be prepared.
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ii. Difficult to ascertain profitability: It is very difficult to prepare the various accounts as
no complete record is available and therefore, it is not easy to ascertain the correct
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profitability of the entity for a particular period of time.

iii. Incapable of ascertaining true financial position: Since, the Real and nominal accounts
are not prepared in this system of accounting, the true financial position of the business
ST

cannot be ascertained.
OR
The various types of accounting softwares are:
i. Ready-to-use: Readymade softwares are softwares, which are available off the shelf.
These softwares are for the users at large and not user specific. These softwares are
suited for organisations running small/ conventional business where the frequency or
volume of accounting transactions is very low.
ii. Customised: The term ‘customised software’ means making changes in the readymade
software to suit the specific requirement of the user i.e., make it user specific. These
softwares are available off the shelf and are changed to suit the requirement of the user.
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 CBSE XI | Accountancy

Sample Paper – 5 – Solution

The developer, to meet specific user requirement, can modify all the readymade
softwares. The user has to bear to cost of such changes.
Customised software are best suited for large and medium businesses and can linked to
the other information system.
iii. Tailored: The term ‘tailor made software’ refers to designing and developing user
specific software. These softwares, being user specific, are not available off the shelf but
are developed on the basis of discussions between the user and developers. These
softwares are suited for large business organization with multi- users and
geographically scattered locations. The tailored software is designed to meet the

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specific requirements of the users and form an important part of the organizations.

Answer 31

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Trading Account
Dr. Cr.
Particulars Rs. Particulars Rs.
To Purchases 12,300 By Sales 20,000
(–) Purchase Return 1,000 11,300 (–) Sales Return 500 19,500
To Carriage Inward
To Gross Profit 8,000
19,700
ID
400 By Closing Stock 200

19,700
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No, it is not correct; debit balance in profit and loss account implies loss as expenses are
more than the revenue.
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Answer 32
Trading Account
for the year ended 31st March 2015
Dr. Cr.
Particulars Rs. Particulars Rs.
D

To Opening stock 18,000 By Sales 2,62,000

To Purchases 1,80,000 (-) Sales Return 26,000 2,36,000
U

(-) Purchases Return 2,000 By closing stock 28,000

(-) Loss by fire 10,000 1,68,000
ST

To Gross Profit c/d 78,000

2,64,000 2,64,000

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Sample Paper – 5 – Solution

Profit and Loss Account

for the year ended 31st March 2015
Dr. Cr.
Particulars Rs. Particulars Rs.
To Office expenses 600 By Gross Profit b/d 78,000
To Selling Expenses 22,200 By Rent Received 3,200
To General expenses 2,000
To Printing and Stationery 800

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To Rent, Rates and Taxes 9,200
To Insurance 1,400
Less: Prepaid 200 1,200
To Administrative Exp. 22,000

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To Bad Debts 1,200
Add: Provision for Bad
and Doubtful Debts (new) 2,000
3,200
Less: Reserve for doubtful
debts (old)
To Depreciation
Plant and machinery
1,600 ID 1,600
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Old (20% on 20,000) 8,000
Addition (500020%6/12) 1,000
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Furniture and Fixtures 500 9,500

To Net Profit c/d 12,100

81,200 81,200
D

Balance sheet
as on 31st March 2015
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Liabilities Rs. Assets Rs.

Current Liabilities Current Assets
Creditors 30,000 Cash in hand 17,000
ST

Cash at Bank 36,400

Capital Debtors 41,200
Opening Balance Less: Bad debts
1,50,000 written off 1,200
Less: Drawing 12,000 40,000
Less: Provision for
1,38,000 bad Debts 2,000 38,000
Add: Net Profit 12,100 1,50,100 Insurance Claim 10,000
Closing Stock 28,000

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 CBSE XI | Accountancy

Sample Paper – 5 – Solution

Prepaid Insurance 200

Fixed Assets
Plant and Machinery 40,000
Add: Addition on
1.10.2016 10,000
Less: Depreciation
@20% 9,000 41,000
Furniture and

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Fixtures 10,000
Less: Depreciation
@5% 500 9,500

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1,80,100 1,80,100

OR

Differences between Double Entry and Single Entry System:

Sr. no.
1 Aspects
Basis
of
ID
Double Entry System Single Entry System
a It records both the aspects of It records only one aspect of
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Transaction the transactions. the transactions. However,
sometimes it is possible that,
it may record both the
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aspects or no aspects at all.

2 Accounts All types of accounts namely Only Personal Accounts are

Considered personal, real and nominal considered. Real and Nominal
are considered. Accounts are ignored except
D

cash account in some cases.

3 Arithmetical It follows the complete Detection of errors and

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Accuracy accounting process and arithmetic accuracy not

therefore, provides possible since Trial Balance is
information for preparation not prepared.
ST

of trial balance from which

the arithmetical accuracy can
be verified.

4 Profit or Loss It facilitates ascertainment of It does not prepare a Profit

Account Net Profit or Loss by and Loss Account and
preparing a Profit and Loss therefore, there exists no
Account. adequate method to
determine Profit or loss for a

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 CBSE XI | Accountancy

Sample Paper – 5 – Solution

particular period.

5 Financial Position It facilitates preparation of It does not prepare a Balance

Balance Sheet on a particular Sheet which shows the
date which shows the financial position of the
financial position of an business. Only a statement of
enterprise with respect to the affairs is prepared with the
assets, liabilities and capital information maintained
of the entity. under this single entry

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system of accounting.

6 Adjustments It ensures that all the It is an incomplete record of

adjustments are made at the the financial transactions and

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time of preparing final therefore, there is no
accounts. provision to make
adjustment to accounts.

7 Use It is used by almost all the It is used only by small

8 Reliability
businesses.
ID businesses and institutions.

Double entry system is based It is not based on fixed

on certain fixed principles principles and, as such, it is
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and, as such, is reliable. not at all reliable
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9 Acceptability Scientific method and Not a scientific method so not

acceptable by all acceptable by some
authorities like Income Tax
Authorities
D
U
ST

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