Practice Paper 2

Subject Accountancy

Class XI
Time : 3 hrs Marks: 90

General Instruction

This Question Paper contains two part A and B.

All question are compulsory.

Answer the question after carefully reading the text.

All parts of question should be attempted at one place.

Part A Financial Accounting-I

1. Why is the evidence provided by source documents important to accounting?
2. The book in which all accounts are maintained is known as
(a) Cash book (b) Journal (c ) Purchase book (d) ledge
3. A trial balance shows
(a) Credit balance (b) Debit balance only

(c) Both debit and credit balance (d) Either debit or credit balance

4. Raj, a dealer in furniture received advance against sales of tables and chairs, he
treated the advance as sales, Identify the value not followed. State the correct
treatment. (1x4)

5. Accounting performs a number of function. Give any three such functions. (3)
6. From the following prepare bank reconciliation statement on 31st March, 2013.
The cheques from X Rs. 25,000, Y Rs. 30,000 and Z Rs. 24,000 were
deposited into account in March, 2013 but were credited by the bank in April,
2013 but were credited by the bank in April, 2013.
The cheque issued to W Rs. 30,000, P Rs. 50,000 and Q Rs. 30,000 in March,
2013 were presented for payment in April 2013.
A Cheque for Rs. 10,000 which was received from a customer was entered in
the bank column of the cash book in March, 2013 but the same was paid into
bank in April, 2013. The bass book shows a credit of Rs. 25,000 for interest
 and a debit of Rs. 5,000 for bank charge. The balance (Debit) as per the cash
book was Rs. 18,00,000 whereas the pass book showed a credit balance of Rs.
18,41,000. (3)
7. Give any three points of distinction between accrual cash basis of accounting.
(3)
8. Briefly discuss the system of accounting which does not record tow fold effect
of transaction? (3)
9. Show the accounting equation on the basic of the following transactions
(i) Started business with cash Rs. 6,00,000 and good Rs. 3,00,000.
(ii) Purchased good for cash Rs. 4,00,000 and on credit Rs. 2,50,000.
1
(iii) Good Costing Rs. 4,80,000 sold at a profit of 33 % Three –Fourth
3

payment received in cash.

(iv) Paid rent Rs. 2,00,000 sold at a loss loss of 5% out of which Rs.
1,20,000 received in cash.
(v) Paid rent Rs. 40,000 and salary Rs. 60,000.
(vi) Received cash from debtors Rs. 1,50,000.
(vii) Paid telephone bill amounting to Rs. 8,000.(4)
10. Rectify the following errors
(i) Good returned to W Rs. 8,000 were recorded in sales return book.
(ii) Goods returned to W Rs. 8,000 were recorded in sale return book.
However, Ws account was correctly debited.
(iii) Good returned from X Rs. 12,000 were recorded in purchase return
book.
(iv) Good returned from X Rs. 12,000 were recorded in purchase return
book. However, X’s account was corrected. (4)
11. Prepare returns inward and returns outward books from the following
transactions.
2013.
Dec 1 XYZ Bros, Meerut returned
5 Pairs of shoes for being defective @ 500 per pair
(-) Trade discount 10%
 Dec 5 Returned to WXY Pvt. Ltd. Delhi
100 pairs of chappals being not up to the approved sample @ 150
per pair (-) Trade discount 15%
Dec 12 PQR Shop Company, Meerut returned 12 pairs of ladies
chappals @ 200 Per pair (-) Trade discount 10%
Dec 20 Returned to Liberty shoes Pvt. Ltd. Punjab
100 Pairs Canvas shoes @175 per pair
(-) Trade discount 15%
Dec 24 MNO Bros, Surat returned 10 pairs sandals @ 250 per
pair(4)(4)

12. Record the following transactions in a suitable cash book and find out the cash
and bank balances
2013 Amt (Rs.)
Mar 1 Cash in hand 5,00,000
Mar 1 Bank overdraft 1,00,000
Mar 2 Paid wages 1,50,000
Mar 3 Deposited into bank 2,00,000
Mar 4 Cash sales 7,50,000
Mar 5 Sold goods for cheque which was deposited
in the same day 5,00,000
Mar 6 Purchased goods from Babu on credit 4,00,000
Mar 7 Draw from bank for personal use 1,00,000
Mar 8 Paid to Babu account, discount received
Rs. 15,000 3,50,000
Mar 9 Received from Golu, who owes Rs 2,10,000,
Rs 2,00,000 only account in full settlement(4)

13. A joint stock company has bought machinery for Rs. 1,00,000 including a
boiler worth Rs. 10,000. This machinery account was for the first four years
 credited for depreciation on the reducing instalment system at the rate of 10%
per annum during the fifth year, i.e., the current year, the which amount is
credited to the machinery account.
Prepare the machinery account for the current year, adjusting there in the cash
received and the loss suffered on the damaged boiler and the depreciation of
the machinery for the current year.(6)

14. Z and Y were in need of funds temporarily. On 1st January, 2013, Z drew upon
Y a bill for Rs. 4,000 for 3 month. Y returned it duly accepted and Z got it
discounted at 18% per annum. Half the proceeds were remitted to Y. on the due
date, Z sent the required sum to Y who the bill. Journalise the transactions in
the books of both the parties.(6)

15. (i) How does matching principle apply to depreciation?

(ii) Explain briefly the accounting period principle?(6)

Part B Financial Accounting-II

16. The nature of receipts and payments account in a non-profit organisations is

(a) real (b) nominal (C) personal (d) None of

these(1)

17. State any two essential features report.(1)

18. Inspite of many capabilities a computer suffers from various limitations. Give
any three such Limitations.(3)

19. (i) Explain the term deferred revenue expenditure with the help of an
example.
 (ii) Under which approach, assets which are liquid are presented first in the

balance sheet?(3)

20. Following incomplete information is available from records maintained by

Raja Mani.

Items 1st April, 2012 Rs. 31st March, 2013 Rs.

Cash 1,00,000 1,500,000
Bank 8,00,000 10,00,000
Debtors 10,00,000 12,00,000
Stock 7,00,000 6,00,000
Machinery 20,00,000 20,00,000
Creditors 11,00,000 10,00,000
Bank Loan 12,00,000 12,00,000

During the year Raja Mani introduced in the business the amount realised on
sale Rs. 10,00,000 investment at the premium of 5%. Personal expenses of Raja
Mani paid from business account amounted to Rs. 1,25,000 per month. Prepare
a statement to calculate profit (or Loss) during the year.(4)

21. (i) What are the various steps involved in designing accounting reports?

(ii) Give any who basic requirement required for the use of computers in
any database oriented application.(6)

22. (i) From the following information of a club show the amounts of match
expenses and match fund in the financial statements of the club for the
year ended on 31st March, 2012 and 31st March, 2013.

Particulars Amt. (Rs)

Match expenses (paid during the year, 2012-2013) 60,00,000

Match fund (as on 31st March, 2012) 34,00,000

Donation for Match fund (received during the year , 2012-2013) 18,00,000
 Proceeds from sale of match tickets (received during the year, 2012-2013) 6,00,000

(ii) Briefly explain the two financial statements required to be prepared by non-
profit organisations. (6)

23. Prepare income and expenditure account and balance sheet from the following
receipts and payments account and the balance sheet.

Receipts and Payments Account

Dr. For the year ended, 2013 Cr.

Receipts Amt. Payments Amt (Rs.)

(Rs.)
To Balance (1st 10,00,000 By Expenses 2012 1,20,000
January, 2013 2013 2,00,000
Subscriptions 20,000 By Land 4,00,000
2012 2,10,000 By Interest 40,000
2013 15,000 By Miscellaneous expenses 2,00,000
2014 80,000 By Balance (31st 8,35,000
To Entrance fees 70,000 December,2013
To Locker rent 4,00,000
To Miscellaneous
17,95,000 17,95,000

Balance Sheet
as at 31st December, 2013

Liabilities Amt (RS.) Assets Amt(Rs)

Capital fund 33,62,000 Buildings 30,00,000
Subscriptions received in advance 60,000 Outstanding subscription 38,000
Outstanding expenses 1,40,000 Outstanding locker's rent 24,000
Loan 5,00,000 Cash 10,00,000
 40,62,000 40,62,000

(8)
24. Prepare the final accounts from the following trial balance for the year ended
31st March, 2013.

Name of accounts Debit Balance (Rs.) Name of accounts Credit

Balance (Rs)
Drawings 85,000 Capital 15,00,000
Purchases 28,00,000 Creditors 4,50,000
Carriage inward 40,000 Outstanding expenses 90,000
Wages 3,00,000 Rent received 20,000
Power 1,10,000 Purchase return 1,50,000
Depreciation on 20,000 Sales 44,00,000
machinery 1,50,000 Provision for bad 20,000
Advertisement 7,00,000 debts 35,000
development 1,80,000 Discount received
Plant and machinery 60,000
Goodwill 3,50,000
Agent's samples 2,62,000
Opening stock 1,60,000
Debtors 1,98,000
Cash at bank 5,00,000
Cash in hand 1,70,000
Salaries 9,000
General expenses 2,10,000
Prepaid expenses 2,30,000
Salary to agent 70,000
Rent and insurance 29,000
Discount allowed 32,000
Sales return 66,65,000 66,65,000
Commission to agent

Adjustment

(i) Closing stock was valued at Rs. 5,00,000 goods costing Rs. 50,000 was
destroyed by fire. The insurance company admitted a claim for Rs.
30,000 only.
(ii) Depreciate agents samples by 25%.
(iii) Write-off advertisement development by 30%.
(iv) Write-off Rs. 22,000 as bad debts and create a provision for doubtful on
debtors at 5%.
 (v) Proprietor withdrew Rs. 10,000 for his private use. This amount was
included in general expenses.
(vi) Charge 5% manager's commission on net profit after charging his
commission.
(vii) There is an contingent liability of Rs. 2,00,000 in respect of a court
case.(8)