MAY 2011 U/ID 1889/PZG

Time : Three hours Maximum : 100 marks

SECTION A — (5 × 8 = 40 marks)

Answer any FIVE questions.

All questions carry equal marks.

1. The trial balance of Bharat Bank Ltd. as on 31st March 2009

shows the following. Prepare profit and loss a/c for the year
ended 31.3.2009.
Rs.
Interest earned 10,10,000
Other incomes 1,25,000
Interest expended 4,15,000
Operating expenses 1,65,000
Retained profit on 1.4.2008 1,00,000
Bad debts written off amounted to Rs. 55,000. Provision for
taxation to be made at 50%.
2009® Bsk ©õºa 31® |õÍßÖ £õµz Á[Q°ß C¸¨¦¨ £mi¯À
R÷Ç EÒÍÁØøÓ PõmkQÓx. A¢u Á[QUS›¯ C»õ£ |mhUPnUS
31.3.2009 AßÖ u¯õ›UPÄ®.
¹.
Ámi Dmi¯x 10,10,000
¤Ó Á¸©õÚ[PÒ 1,25,000
Ámi ö\¾zv¯x 4,15,000
ö\¯À£õmk ö\»ÄPÒ 1,65,000
uUP øÁzu C»õ£® (1.4.2008) 1,00,000

ÁµõUPhß ¹. 55,000 ÷£õUS GÊu¨£mhx. C»õ£zvÀ 50% Á›US

JxUS E¸ÁõUP¨£h ÷Ásk®.

2. A Life Assurance Company prepared its Revenue account for the

year ended 31st March 2009 and ascertained its life assurance
fund to be Rs. 56,70,000. It was found latter that the following
had been omitted from the accounts :
(a) Interest accrued on investments Rs. 78,000 income tax
liable to be deducted estimated to be Rs. 21,000.
(b) Outstanding premium Rs. 65,600.
 (c) Bonus utilised in reduction of premium Rs. 13,500.
(d) Claims intimated but not admitted Rs. 34,800.
(e) Claims covered under re-insurance Rs. 13,000.
Ascertain the true life assurance fund.
J¸ B²Ò Põ¨¥mk {Ö©® 2009 ©õºa 31 •i¯ BsiØPõÚ Auß
Á¸Áõ´ PnUøPz u¯õº ö\´x B²Ò Põ¨¤mk {v ¹. 56,70,000
GÚ PshÔ¢ux. Auß ¤ßÚº RÌUPõq® ÂÁµ[PÒ Âk£mk
÷£õÚuõP PshÔ¢ux.
(A) •u½kPÒ «x Áµ÷Ási¯ Ámi ¹. 78,000. AvÀ PÈUP¨£h
÷Ási¯ Á¸©õÚ Á› ¹. 21,000.
(B) ö£Ó ÷Ási¯ Põ¨¥mk •øÚ©® ¹. 65,600.
(C) •øÚ©® ÁµÂÀ PÈzxU öPõÒͨ£mh ÷©¿v¯® ¹. 13,500
(D) AÔÂUP¨£mk BÚõÀ AÝ©vUP¨£hõu ÷Põ›UøP
¹. 34,800.
(E) ©ÖPõ¨¥mk ‰»® £õxPõUP¨£mh ÷Põ›UøP ¹. 13,000.
Esø©¯õÚ B²Ò Põ¨¥mk {vø¯U PnUQkP.

3. A company has 4,000, 7% redeemable preference shares of

Rs. 100 each fully paid. The company decides to redeem the
shares on December 31, 2009 at a premium of 5%. The company
has sufficient profits. The following issues are made for the
redemption purpose :
(a) 1000 equity shares of Rs. 100 each at a premium of 10%
(b) 1000 5% debentures of Rs. 100 each
The issue was fully subscribed and all the amounts were
received. The redemption was duly carried out. Give journal
entries.
J¸ {Ö©® ¹. 100 •ÊÁx® ö\¾zv¯ ©v¨¦ÒÍ 4,000 7% «Ò uS
•ßÝ›ø© £[SPøÍ øÁzxÒÍx. i\®£º 31,2009À
A¨£[SPøÍ 5% •øÚ©zvÀ «mP •iöÁkzux. C¢{Ö©zvÀ
÷£õx©õÚ »õ£® EÒÍx. £[S «m¤ØPõP RÌUPshøÁPøÍ
öÁΰkQÓx.
(A) ¹. 100 ©v¨¦ÒÍ \©£[SPøÍ 10% •øÚ©zvÀ 1000 \©
£[SPÒ öÁΰkQßÓÚ.
(B) ¹. 100 ©v¨¦ÒÍ 5% Phß £zvµzøu 1000 öÁΰkQßÓÚ.
C¢u öÁαk •ÊÁx©õP ö£Ó¨£mhx. «m¦® \›¯õP
|h¢÷u›¯x. SÔ¨÷£mk¨ £vÄPÒ u¸P.

2 U/ID 1889/PZG
4. The following scheme of reconstruction was approved by
X Ltd.
(a) The shareholders to receive in lieu of their present holding
of 50,000 shares of Rs. 10 each, the following :
(i) Fully paid ordinary shares equal to 2/5 of their
holdings
(ii) 5% preference shares to the extent of 1/5 of the above
ordinary shares
(iii) Rs. 60,000, 6% debentures.
(b) The goodwill which stood at Rs. 3,00,000 was written down
to Rs. 1,50,000.
(c) Plant and buildings were written down by Rs. 20,000 and
Rs. 30,000 respectively.
Give Journal entries.
RÌUPõq® ©Ö^µø©¨¦z vmhzøu X {Ö©® AÝ©vzxÒÍx.
(A) 50,000 £[SPÒ ¹. 10 Ãu® øÁzxÒÍ £[SuõµºPÒ R÷Ç
SÔ¨¤mkÒÍøu¨ ö£ÖQÓõºPÒ.
(i) AÁºPÒ øÁzxÒÍvÀ 2/5 £[S •Êø©¯õP
ö\¾zu¨£mh \õuõµn¨ £[SPøͨ ö£ÖQÓõºPÒ.
(ii) 1/5 £[S ÷©Øö\õÀ»¨£mh \õuõµn¨ £[SPÎÀ, 5%
•ßÝ›ø©¨ £[SPÒ ö£ÖQÓõºPÒ.
(iii) ¹. 60,000 ©v¨¦ÒÍ , 6% Phß £zvµ[PÒ
(B) ¹. 3,00,000 ©v¨¦ÒÍ |Øö£¯º ¹. 1,50,000US
SøÓUP¨£mhx.
(C) ö£õÔ ©ØÖ® Pmih[PÒ •øÓ÷¯ ¹. 20,000 ©ØÖ® ¹. 30,000
SøÓUP¨£mhÚ.
SÔ¨÷£mk¨ £vÄPÒ u¸P.

5. From the following particulars, prepare fire revenue a/c for the
year 2009 :
Rs.
Claims Paid 4,80,000
Premiums received 12,00,000
Re-insurance premium 1,20,000

3 U/ID 1889/PZG
 Rs.
Commission 2,00,000
Management expenses 3,00,000
Fire Insurance Fund (1.1.2009) 5,20,000
Claims unpaid on 1.1.2009 40,000
Claims unpaid on 31.12.2009 70,000
Make provision against fire fund at end @ 50% of net
premium.
RÌUPõq® ÂÁµ[Pμ¸¢x ‘w’ Põ¨¥mkz xøÓ°ß Á¸Áõ´
PnUøP 2009® BsiØS u¯õº ö\´P.
¹.
÷Põ¸›ø© ö\¾zv¯x 4,80,000
•øÚ©® ö£ØÓx 12,00,000
©ÖPõ¨¥mk •øÚ©® 1,20,000
uµS 2,00,000
÷©»õsø© ö\»ÄPÒ 3,00,000
w Põ¨¥mk {v (1.1.2009) 5,20,000
1.1.2009 AßÖ ÷Põ¸›ø© {¾øÁ 40,000
31.12.2009 AßÖ ÷Põ¸›ø© {¾øÁ 70,000

Bsk CÖv°À {Pµ •øÚ©zöuõøP¨ ö£ØÓvÀ 50%

wUPõ¨¥mk {v JxUSP.

6. Distinguish between CPP and CCA methods of Inflation

accounting.
Âø» ©õØÓU PnUQ¯¼ß CPP ©ØÖ® CCA •øÓPøÍ
÷ÁÖ£kzxP.

7. Explain the common transactions to be eliminated while

preparing the consolidated balance sheet.
J¸[Qøn¢u C¸¨¦ {ø»USÔ¨¦ u¯õ›US® ÷£õx }UP® ö\´¯
÷Ási¯ ö£õx |hÁiUøPPøÍ ÂÍUSP.

8. What are the conditions for redemption of preference shares?

•ßÝ›ø© £[SPøÍ «m£uØSshõÚ {£¢uøÚPÒ ¯õøÁ?

4 U/ID 1889/PZG
 SECTION B — (3 × 20 = 60 marks)

Answer any THREE questions.

All questions carry equal marks.

9. A company issued 40,000 shares of Rs. 10 each at a premium of

Rs. 2 per share. These shares were payable as follows :
On application : Rs. 2
On allotment Rs. 5 (including premium)
On first and final call Rs. 5.
All the shares were applied for and allotted. All moneys were
received with the exception of the first and final call on 1000
shares which were forfeited. Out of these shares, 400 were
reissued at Rs. 8 per share as fully paid.
Give the Journal entries and prepare the balance sheet of the
company.
J¸ {Ö©®, JÆöÁõßÖ® ¹. 10UPõÚ, 40,000 £[SPøÍ, £[SUS
¹. 2 GßÓ •øÚ©zvÀ öÁΰmhx. AzöuõøP°øÚ
RÌUPshÁõÖ ö\¾zu ÷Ási²ÒÍx.
Âsn¨£zvß ÷£õx ¹. 2
JxURmiß ÷£õx ¹. 5 (•øÚ©® ÷\ºzx)
•uÀ ©ØÖ® CÖv AøǨ¤ß ÷£õx ¹. 5
AøÚzx Âsn¨£[PЮ HØP¨£mk, JxUQmk ö\´¯¨£mhx.
1000 £[SPÐUPõÚ •uÀ ©ØÖ® CÖv AøǨ¦ öuõøP°øÚz
uµ, ©ØÓ öuõøP •ÊÁx® ö£ØÖU öPõÒͨ£mhx.
C¢u¨£[SPÒ AøÚzx® £Ô•uÀ ö\´¯¨£mhÚ. CÁØÔÀ 400
£[SPÒ, ¹. 8 Ãu® ©Ö£i²® öÁαk ö\´¯¨£mhÚ.
÷©ØUPsh ÂÁµ[PÒ •uÀ SÔ¨÷£miÀ £vÄ ö\´x C¸¨¦
{ø»USÔ¨ø£ u¯õº ö\´P.

10. Sun Ltd. was incorporated on 1.8.2009. It took over the business
of Moon Ltd. with effect from 1.4.2009. From the following
particulars relating to the year ending 31.3.2010, find out profit
prior to incorporation and after incorporation. Sales for the year
were Rs. 60 lakhs and pre-incorporation sales of Rs. 25 lakhs.
Gross profit for the year was Rs. 18 lakhs.

5 U/ID 1889/PZG
 Expenses debited to Profit and Loss a/c :
Rs.
Rent 90,000
Salaries 1,50,000
Directors fees 38,000
Interest on debentures 60,000
Audit fees 15,000
Discount on sales 36,000
Depreciation 2,40,000
General expenses 48,000
Advertising 1,80,000
Printing and Stationary 36,000
Commission on sales 60,000

Interest to vendors on purchase consideration Rs. 30,000 (upto

1.10.2009)

\ß {Ö©® 1.8.2009 AßÖ £vÄ ö\´¯¨£mhx. 1.4.2009 •uÀ ‰ß

{Ö©zvß Â¯õ£õµzøu GkzxU öPõshx. 31.3.2010® Bsk
•i¯ EÒÍ ÂÁµ[PÎß Ai¨£øh°À £vÂØS •ß¦ÒÍ »õ£®
©ØÖ® £vÂØS ¤ß¦ÒÍ »õ£zvøÚU PnUQkP. Jµõsiß
ÂØ£øÚ ¹. 60 »m\® BS®. ©ØÖ® AvÀ £vÂØS •ß¦ EÒÍ
ÂØ£øÚ ¹. 25 »m\® BS®. Jµõsiß ö©õzu C»õ£® ¹. 18 »m\®
BS®. C»õ£ |mh PnUQÀ £ØöÓÊv¯ ö\»ÄPÍõÚøÁ :
¹.
ÁõhøP 90,000
\®£Í® 1,50,000
C¯US|ºPÍx Pmhn® 38,000
Phß £zvµ Ámi 60,000
uoUøP Pmhn® 15,000
ÂØ£øÚ «uõÚ uÒУi 36,000
÷u´©õÚ® 2,40,000

6 U/ID 1889/PZG
 ¹.
ö£õxa ö\»ÄPÒ 48,000
ÂÍ®£µ® 1,80,000
Aa_ ©ØÖ® GÊx ö£õ¸ÒPÒ 36,000

ÂØ£øÚ «uõÚ PÈÄ 60,000

ÂØÓ£¸US öPõÒ•uÀ ©Ö£¯ß «uõÚ ¹. 30,000 Ámi¯õS®.

(1.10.2009 Áøµ)

11. Authorised capital of Vijay Ltd is Rs. 5,00,000 (50,000 shares of

Rs. 10 each). On 31.12.2009, 25,000 shares were fully called up
on 31.12.2009, the following balances taken from the ledger of
the company.
Rs.
Opening stock 50,000
Sales 4,25,000
Purchases 3,00,000
Wages 70,000
Discount allowed 4,200
Discount received 3,150
Insurance (paid upto 31.3.10) 6,720
Salaries 18,500
Rent 6,000
General expenses 8,950
Printing and stationary 2,400
Advertising 3,800
Bonus 10,500
Sundry debtors 38,700
Sundry creditors 35,200
Plant and Machinery 80,500
Furniture 17,100
Cash and bank 1,34,700
7 U/ID 1889/PZG
 Rs.
Reserve 25,000
Loan from M.D. 15,700
Bad debts 3,200
Calls in arrears 5,000
Profit and Loss a/c (cr) 6,220
Additional informations were furnished :
(a) Closing stock Rs. 91,500.
(b) Depreciation on plant and machinery furniture @ 15% and
10% respectively.
(c) Wages, salaries and rent outstanding amounts to Rs. 5,200,
Rs. 1,200 and Rs. 600 respectively.
(d) Dividend @ 5% on paid up share capital is to be provided.
Prepare final accounts of the company.
Âá´ {Ö©zvß A[RP›UP¨£mh ‰»uÚ® ¹. 5,00,000 (50,000
£[SPÒ ¹. 10 Ãu®). 31.12.2009 AßÖ 25,000 £[SPÒ •Êø©¯õP
AøÇUP¨£mhøÁ BS®. 31.12.2009 {Ö© HkPμ¸¢x
GkUP¨£mh C¸¨¦PÒ ÂÁµ® ¤ßÁ¸©õÖ :
¹.
öuõhUP \µUQ¸¨¦ 50,000
ÂØ£øÚ 4,25,000
öPõÒ•uÀ 3,00,000
T¼ 70,000
uÒУi AÎzux 4,200
uÒУi ö£ØÓx 3,150
Põ¨¥k (31.3.10 Áøµ ö\¾zv¯x) 6,720
\®£Í® 18,500
ÁõhøP 6,000
ö£õxa ö\»ÄPÒ 8,950
Aa_ ©ØÖ® GÊxö£õ¸Ò 2,400
ÂÍ®£µ® 3,800
ªøP³v¯® 10,500

8 U/ID 1889/PZG
 ¹.
£Ø£» PhÚõÎPÒ 38,700
£Ø£» PhÜ¢÷uõºPÒ 35,200
ö£õÔ ©ØÖ® G¢vµ® 80,500
AøÓP»ß 17,100
öµõUP® ©ØÖ® Á[Q 1,34,700
JxURk 25,000
M.D. Ch® ö£ØÓ Phß 15,700
ÁõµõUPhßPÒ 3,200
AøǨ¦ {¾øÁ 5,000
C»õ£ |mhU P/S (ÁµÄ) 6,220

TkuÀ £µ[PÒ ¤ßÁ¸©õÖ :

(A) CÖv \µUQ¸¨¦ ¹. 91,500
(B) ö£õÔ ©ØÖ® G¢vµ® AøÓP»ß «uõÚ ÷u´©õÚ® •øÓ÷¯
15% ©ØÖ® 10% BS®.
(C) T¼, \®£Í® ©ØÖ® ÁõhøP {¾øÁ •øÓ÷¯ ¹. 5,200,
¹. 1,200 ©ØÖ® ¹. 600 BS®.
(D) ö\¾zx £[S •uÀ «uõÚ 5% £[Põuõ¯® JxUP ÷Ásk®.
{Ö©zvß CÖvU PnUSPøÍ u¯õ›UPÄ®.

12. Siva Ltd Voluntarily liquidated on 31.12.2009. Information

available to liquidator :
Rs.
Sundry creditors 75,660 (included preferential creditors
Rs. 8,000)
6% debentures 80,000 (having floating charge)
Debentures are redeemed on 30.6.2010
Debentures interest already paid upto 30.6.2009.
Assets realised : Rs.
Stock 84,000
Machinery 60,600
Cash in hand 500
Liquidation expenses 1,902

9 U/ID 1889/PZG
 Liquidator’s remuneration : 3% on assets realised, 2% on amount
paid to unsecured creditors. Prepare Liquidator’s final statement
of account.
]Áõ {Ö©® 31.12.2009À uõ÷Ú Pø»UP¨£mhx. Pø»¨£õÍ›h®
¤ßÁ¸® uPÁÀPÒ EÒÍx :
¹.
£Ø£» PhÜ¢÷uõºPÒ 75,660 (CvÀ •ßÝ›ø© PhÜ¢÷uõºPÒ
¹. 8,000 Ah[Q²ÒÍx)
6% Phß £zvµ[PÒ 80,000 («uøÁ¨ £ØÖøh¯øÁ)
CÁØÔß «x 30.6.2009 Áøµ Ámi ö\¾zu¨£mhx
Phߣzvµ[PÒ 30.6.2010 AßÖ «mP¨£mhx.
ö\õzxUPÒ ¤ßÁ¸©õÖ ÂØP¨£mhÚ :
¹.
\µUS 84,000
C¯¢vµ® 60,600
öµõUP C¸¨¦ 500
Pø»¨¦ ö\»ÄPÒ 1,902
Pø»¨£õͺ Fv¯® : ö\õzxUPÒ ÂØÓ öuõøP°À 3%, ¤øn¯ØÓ
PhÜ¢÷uõºPÐUS ÁÇ[P¨£mh öuõøP°À 2%.
Pø»¨£õÍ›ß CÖvU PnUøP u¯õº ö\´P.

13. From the balance sheets and information given below, prepare
consolidated balance sheet.

Balance Sheet as on 31.12.2009

H Ltd S Ltd H Ltd S Ltd
Rs. Rs. Rs. Rs.
Share capital :
Rs. 10 fully paid 10,00,000 2,00,000 Sundry assets 8,00,000 1,20,000
Profit and loss a/c 4,00,000 1,20,000 Stock 6,10,000 2,40,000
Reserve 1,00,000 60,000 Debtors 1,30,000 1,70,000
Creditors 2,00,000 1,20,000 Bills receivable 10,000 –
Bills payable – 30,000 Shares in S,
15,000 at cost 1,50,000 –
17,00,000 5,30,000 17,00,000 5,30,000

10 U/ID 1889/PZG
 (a) All the profit of S has been earned since the shares were
acquired by H, but there was already the reserve of
Rs. 60,000 at that date.
(b) The bills accepted by S Rs. 10,000 are in favour of H.
(c) Sundry assets of S are undervalued by Rs. 20,000.
(d) The stock of H includes Rs. 50,000 bought from S at a
profit to the latter of 25% on cost.
R÷Ç öPõkUP¨£mkÒÍ C¸¨¦{ø» SÔ¨¦PÒ ©ØÖ® uPÁÀPøÍ
öPõsk Cøn¢u C¸¨¦ {ø»USÔ¨¦ u¯õº ö\´P.

C¸¨¦ {ø»USÔ¨¦ 31.12.2009À

H ¼m S ¼m H ¼m S ¼m
¹. ¹. ¹. ¹.
£[S •uÀ :
¹. 10 Ãu® 10,00,000 2,00,000 £ÀÁøPa
»õ£|mhU P/S 4,00,000 1,20,000 ö\õzxUPÒ 8,00,000 1,20,000
Põ¨¦ 1,00,000 60,000 \µUQ¸¨¦ 6,10,000 2,40,000
PhÜ¢÷uõº 2,00,000 1,20,000 PhÚõÎPÒ 1,30,000 1,70,000
ö\¾zxuØS›¯ ö£ÖuØS›¯
©õØÖa ^mk – 30,000 ©õØÖa ^mkPÒ 10,000 –
SP®ö£Û°ß
£[SPÒ 15,000 1,50,000 –
AhUP®
17,00,000 5,30,000 17,00,000 5,30,000
(A) H P®ö£Û¯õÀ £[S Áõ[P¨£mh ¤ÓS S P®ö£Û¯õÀ
C»õ£® •ÊÁx® Dmh¨£mhx. BÚõÀ •ßTmi EÒÍ Põ¨¦
¹. 60,000.
(B) H P®ö£Û «uõÚ S P®ö£Û HØP¨£mh ö\¾zxuØS›¯
©õØÖa^mk ¹. 10,000.
(C) S P®ö£Û°ß £ÀÁøP ö\õzx ¹. 20,000 SøÓzx
©v¨¤h¨£mhx.
(D) AhUP Âø»°À 25% »õ£® øÁzx S P®ö£Û°hª¸¢x H
P®ö£Û Áõ[Q¯ \µUS ¹. 50,000 Auß \µUQ¸¨¤À
Ah[Q²ÒÍx.

————————

11 U/ID 1889/PZG