Pre-Board Examination 1- 2019-20

Sub: ACCOUNTANCY (055)

Class: XII Marks: 80

Date: Time: 3 hrs.
General Instructions:
i. This question paper contains two parts – A and B.
ii. Both parts are compulsory for all.
iii. All parts of a question should be attempted at one place.

PART - A

State whether the following is true or false: ( 1 x 5 = 5 )

1. Sleeping partner are those who do not take part in conduct of the business. 1
2. Government grant received by a school for scholarship is revenue receipt. 1
3. The retiring partner’s capital account is debited with his/her share of goodwill and
remaining partner’s capital account is credited. 1
4. Securities premium money can be utilized to issue fully paid Bonus shares. 1
5. The payment of interest on debentures is a charge on profits of a company. 1

Fill in the blank : ( 1 x 2 = 2 )

6. Revaluation account is a __________ account. 1
7. Mohan withdrew Rs. 4,000 per month at the beginning of every month. Firm closes its
accounts on 31st March. Rate of interest charged on drawings is 12% p.a. Amount of
interest on drawing will be Rs. __________. 1

MCQ: ( 1 x 4 = 4 )

8. Interest on capital will be paid to the partners if provided for in the partnership deed
but only out of
a) Profits b) Reserves c) Accumulated Profits d) Goodwill 1
9. Weighted average method of calculating goodwill is used when
a) Profits are not equal b) Profits show a trend
c) Profits are fluctuating d) none of the above 1

10. The excess amount which the firm can get on selling its assets over and above
the saleable value of its assets is called
a) Surplus b) Super profits c) Reserve d) Goodwill 1

11. The portion of authorized capital which can be called up only on the liquidation
of the company :-
(a) Authorised capital (b) Reserve capital (c) Issued capital (d) Called up capital 1

Match the following ( 1 x 2 = 2 )

12. Match the assets in List I with the types of assets in List II using the codes given 1

List I (Assets) List II (Types of Assets)

1. Land & Building a) Fictitious Assets

2. Profit and Loss Account (Dr.) b) Wasting Assets

3. Mines c) Fixed Assets

4. Goodwill d) Intangible

13. Match the following items: 1

1.At the time of forfeiture of shares, Share a) Amount received

Capital is debited with

2.At the time of forfeiture of shares, share b) Amount not received

Forfeiture is Credited with

3. At the time of forfeiture of shares, Calls in c) Amount demanded

Arrear is credited with
4. First call money sent on allotment by a d) Calls in advance
shareholder is known as
 14.From the following information of a not for profit organization, show the ‘sports
material’ items in the ‘Income and Expenditure Account’ for the year ending 31st

March, 2009 and the Balance Sheets as at 31st March 2008 and 31st March, 2009.
Particulars 31st March, 31st March,
2008 2009
Stock of Sports Material 2,200 5,800
Creditors for sports material 7,800 9,200
Advance to suppliers for sports material 15,000 25,000
Payment to supplies for the sports material during the year was Rs.1,20,000. 3
( OR )

How the following items for the year ended 31st March, 2018 will be presented in the
financial statements of Ashoka Club :
Particulars Debit Amount Credit Amount
Tournament Fund 1,50,000
Tournament Fund Investment 1,50,000
Income from Tournament Fund
Investment 18,000
Tournament Expenses 12,000

15.A and B are partners sharing profits in the ratio of 3:2. They decided to admit C as
partner on 1st April, 2018 on the following terms :

i. C will be given 2/5th share of the profit.

ii. Goodwill of the firm be valued at two years’ purchase of three years’
normal average profit of the firm.
Profits of the previous three years ended 31st March, were:
2018 – Profit ₹ 30,000 ( after debiting loss of stock by fire Rs. 40,000 )
2017 – Loss ₹ 80,000 ( includes voluntary retirement compensation paid Rs.
1,10,000 )
2016 – Profit Rs 1,10,000 ( including a gain of Rs 30,000 on the sale of fixed asset )

You are required to value the goodwill. 4

16. X ltd. took over the following assets and liabilities of Y ltd:
Land & building Rs. 20,00,000; Stock Rs. 5,00,000; Sundry Debtors Rs. 2,50,000
and Sundry Creditors Rs. 2,00,000.
X ltd. paid purchase consideration by issuing Bank Draft of Rs. 16,00,000 and
50,000 Equity Shares of Rs. 20 each at 10% premium. Calculate purchase
consideration and pass journal entries in the books of X ltd. 4

17.A and B are partners in a firm sharing profits and losses in the ratio of 3:2. The
following was the Balance Sheet of the firm as on 31.3.2010.
Liabilities Rs Assets Rs
Capitals : Sundry Assets 80,000
A 60,000
B 20,000
80,000 80,000

The profits Rs. 30,000 for the year ended 31.3.2010 were divided between the
partners without allowing interest on capital @ 12% p.a. and salary to A @ Rs.
1,000 per month.

During the year A withdrew Rs. 10,000 and B Rs. 20,000.

Pass the necessary adjustment journal entry and show your working clearly. 4

( OR )

Maanika, Bhavi and Komal are partners sharing profits in the ratio of 6:4:1. Komal
is guaranteed a minimum profit of Rs. 2,00,000. The firm incurred a loss of Rs.
22,00,000 for the year ended 31st March, 2018. Pass necessary journal entry
regarding deficiency borne by Maanika and Bhavi and prepare Profit and Loss
Appropriation Account.

18.A, B and C are partners sharing profits and losses in the ratio of 2:3:4. They
decided to share future profits and losses in the ratio of 4:3:2. They also decided to
record the effect of the following without affecting their book values:
 Rs.
General Reserve 40,000
Profit and Loss A/c 20,000
Advertisement Suspense Account 15,000

You are required to give the necessary Single journal entry. 4

19.Following is the Receipt and Payment Account of Literacy Club for the year ended
31.3.2006:

Receipts Rs Payments Rs

Balance b/d 19,550 Salary 3,000

Subscription: Newspapers 2,050

2004-2005 1,200 Electricity bill 1,000

2005-2006 26,500 Fixed deposit (On 1.7.2005 @

9% p.a.) 20,000

2006-2007 500 28,200 Books 10,600

Sale of old newspapers 1,250 Rent 6,800

Government Grants 10,000 Furniture 10,500

Sale of old furniture Balance c/d 11,200

(Book value Rs 7,000) 5,700

Interest on fixed deposits 450

65,150 66,150

Additional Information:
(i) Subscription outstanding as on 31.3.2005 were Rs 2,000 and on 31.3.2006 Rs
2,500.
(ii) On 31.3.2006 salary outstanding was Rs 600 and rent outstanding was Rs 1,200.
(iii) The club owned furniture Rs 15,000 and books Rs 7,000 on 1.4.2005.
Prepare Income and Expenditure Account of the Club for the year ended 31.3.2006 and
ascertain ‘ Capital Fund’ on 31.3.2005. 6
20. Journalise the following transactions

a) Mehar Ltd. issued Rs. 5,00,000, 10% Debentures of ₹ 100 each at a premium of
10% redeemable at a premium of 2%

b) 12 % Debentures were issued at a discount of 10% to a vendor of machinery

for payment of Rs. 9,00,000

c) Issue of 20,000 11% debentures of Rs. 100 each as collateral in favour of State Bank

of India. Company opted to pass necessary entry for issue of debentures. 6

( OR )

Arun and Sons Ltd has total redeemable debentures of Rs. 10,00,000. It decides to
redeem these debentures in two instalments of Rs 6,00,000 and Rs. 4,00,000 on
December 31st 2018 and March 31st 2020 respectively. Assuming that the Company
has sufficient funds in Debenture Redemption Reserve Account, pass necessary journal
entries for the year ending March 31st 2020.

21. Gopal, Rajnish and Lokesh were in a partnership sharing profits in the ratio 2:1:1.
On 31st March, 2015, their Balance sheet was as follows:

Liabilities Rs. Assets Rs.

Creditors 15,000 Cash at Bank 17,000
Employee Provident Fund 5,000 Debtors 24,500
Profit and Loss A/c 15,000 Less : Provision 1,200 23,300
Capital A/c Stock 14,700
Gopal 40,000 Machinery 35,000
Rajnish 30,000 Land and Building 40,000
Lokesh 25,000 95,000
1,30,000 1,30,000

On the above date Rajnish retires and the following was agreed:
(i) Goodwill of the firm was valued at 2 years’ purchase of super profits. Average
profits amounted to Rs. 21,500 and normal rate of return in the industry was
10%.
(ii) Land and Building was to be appreciated by 20% and Machinery was to be
reduced to 70%.
(iii) Bad debts amounted to Rs. 600.
(iv) Rajnish was to be paid Rs. 9,250 on the date of retirement and balance
amount to be paid in two equal instalments together with interest @ 10% p.a.
(v) Capital of the new firm is fixed at Rs. 90,000. Surplus / deficit will be adjusted
through Bank Account.
(vi) There was an unrecorded liability for outstanding legal charges Rs. 500.

(vii) Creditors worth Rs. 10,000 allowed a discount of 10% on immediate

payment and partners decided to pay immediately.

Prepare Revaluation Account, Partners’ Capital Account and the Balance Sheet of the
new firm after Rajnish’s retirement. 8

( OR )

Neha and Preeti two partners who were sharing profits and losses equally, had the

following Balance Sheet as on 31st March, 2015. They decided to admit Chandra into
partnership as an equal partner on that date:
Balance Sheet as on 31st March, 2015
Liabilities Rs. Assets Rs.
Capital : Machinery 28,000
Neha 35,000 Investments 18,250
Preeti 25,000 Debtors 17,400
Creditors 7,000 Provision 1,400 16,000
Employees Provident Fund 3,500 Stock 9,250
Investment Fluctuation Cash 8,000
Fund 9,000
79,500 79,500

For the purpose of admission, the following conditions have been agreed:
(i) Assets and liabilities shall be revalued as follows:

a) Investment Rs. 17,500

b) Reserve for doubtful debts increased to Rs. 1,750
c) Stock to be valued at Rs. 8,000
d) Machinery to be depreciated by 5%
e) There is an old furniture worth Rs. 1,200 to be bought into books and
was taken over by the partners in their old profit-sharing ratio.
(ii) Goodwill of the firm is valued Rs. 22,500 and Chandra paid for his share.
 (iii) Chandra has agreed to bring in Rs. 50,000 as his capital in addition to his
goodwill.
(iv) The capital A/c have to be adjusted on the basis of Chandra’s capital
contribution through Current A/c.

Prepare Revaluation a/c, Capital Accounts of Partners and the Balance Sheet of the firm
after Chandra’s admission.

22. Saral Ltd. invited applications for issuing 25,000 equity shares of Rs.100 each at
par. The amount per share was payable as follows :

On Application : Rs. 20 per share

On Allotment : Rs. 30 per share

On First Call : Rs. 25 per share

On Second and Final Call : Rs. 25 per share

Applications were received for 24,000 shares and the shares were allotted to
all the applicants. All calls were made and were received as follows :
On 18,000 shares : Full amount
On 2,000 shares : Rs. 75 per share
On 2,500 shares : Rs. 50 per share
On 1,500 shares : Rs. 20 per share

The company forfeited those shares on which less than Rs. 75 per share were received.
The forfeited shares were reissued at Rs. 95 per share fully paid up.
Pass necessary journal entries for the above transactions in the books of the
company. 8

( OR )

AB Ltd. invited applications for issuing 75,000 equity shares of Rs. 100 each at a
premium of Rs. 30 per share. The amount was payable as follows :
On application and allotment — Rs. 85 per share
On first and final call — The balance amount.
Applications for 1,27,500 shares were received. Applications for 27,500 shares were
rejected and shares were allotted on pro-rata basis to the remaining applicants. Excess
money received on application and allotment was adjusted towards sums due on first and
final call. The calls were made. A shareholder, who applied for 1,000 shares, failed to pay
the first and final call money. His shares were forfeited. All the forfeited shares were
reissued at Rs. 150 per share fully paid up.
Pass necessary journal entries for the above transactions in the books of AB Ltd.

PART - B

23. What will be the effect on quick ratio if a bills payable is discharged on maturity? 1
24. The two basic measures of operational efficiency of a company are : ( MCQ )
i. Inventory Turnover Ratio and Working Capital Turnover Ratio
ii. Liquid Ratio and Operating Ratio
iii. Liquid Ratio and Current Ratio
iv. Gross Profit Margin and Net Profit Margin 1
25. Debt Equity Ratio of a company is 1:2. Issue of equity shares of Rs. 5,00,000 will
increase, decrease or not change the ratio? 1
26. Give any two characteristics of financial statements. 1
27. Dividend Received is considered as operating activity when : ( MCQ ) 1
i. Received by a manufacturing company.
ii. Received by a Trading Company.
iii. Received by any company.
iv. Received by a finance company.
28. Write any two tools for analysis of financial statements. 1
29. Payment of Income Tax is classified as : ( MCQ ) 1
i. Operating activities.
ii. Investing activities.
iii. Financing activities.
30. Calculate opening and closing trade receivables from the following information :
Trade Receivable turnover ratio 4 times; Cost of Revenue from Operations Rs. 3,20,000;
Gross profit ratio 20%; Closing trade receivables were Rs. 15,000 more than opening
trade receivables; cash revenue from operations being 33 1 3 % of credit revenue from
operations. 3

( OR )
Calculate Operating Ratio and Operating Profit Ratio from the following :
Rs.
Revenue from Operations ( Net Sales ) 5,00,000
Cost of Revenue from Operations ( Cost of Goods Sold ) 2,00,000
Wages 1,00,000
Office and Administrative Expenses 50,000
Interest on Borrowings 5,000

31.From the following Statement of Profit and Loss of the Sakhi Ltd. for the year ended
31st March, 2016 and 31st March, 2015, Prepare Comparative Statement of Profit and
Loss. 4
Particulars 2014 – 2015 2015 – 2016
Rs. Rs.
Revenue from Operations 25,00,000 40,00,000
Expenses :
a) Employee benefit expenses were 5% of
Revenue from Operations
b) Other expenses 5,90,000 6,80,000
Rate of Tax 35% 35%

( OR )

Following is the Statement of Profit & Loss of XL Limited for the year ended 31st
March, 2017 and 31st March, 2016. Prepare Common Size Statement of Profit & Loss.
Particulars 2015 – 2016 2016 – 2017
Rs. Rs.
Revenue from Operations 50,00,000 80,00,000
Expenses :
a) Employee benefit expenses were 10% of
Revenue from Operations
b) Other expenses 10,00,000 12,00,000
Rate of Tax 40% 40%
32.From the following Balance Sheet of Mayur Ltd. and the additional information as at
31st March, 2018, prepare a Cash Flow Statement :

Mayur Ltd. Balance Sheet as at 31st March, 2018

Particulars Note 31.3.2018 31.3.2017
Number Rs. Rs.
I EQUITY AND LIABILITIES :
1 Shareholders’ Funds :
a) Share Capital 30,00,000 20,00,000
b) Reserve and Surplus 1 3,00,000 4,00,000
2 Non-current Liabilities :
Long-term Borrowings 2 4,00,000 3,00,000
3 Current Liabilities :
a) Trade Payables 1,70,000 2,50,000
b) Short-term Provisions 3 76,000 64,000
Total 39,46,000 30,14,000

II ASSETS :
1 Non-current Assets :
Fixed Assets :
a) Tangible 4 29,00,000 23,00,000
b) Intangible 5 2,70,000 1,60,000
2 Current Assets :
a) Inventories 2,20,000 2,30,000
b) Trade Receivables 1,10,000 1,30,000
c) Cash and Cash Equivalents 4,46,000 1,94,000
Total 39,46,000 30,14,000
 Notes to Accounts :

Note Particulars 31.3.2018 31.3.2017

Number Rs. Rs.
1 Reserve and Surplus :
Surplus (Balance in Statement of Profit
and Loss) 3,00,000 4,00,000

2 Long-term Borrowings :
9% Debentures 4,00,000 3,00,000
3 Short-term Provisions :
Provision for Tax 76,000 64,000
4 Tangible Assets :
Machinery 36,00,000 28,00,000
Accumulated Depreciation ( 7,00,000 ) ( 5,00,000 )
29,00,000 23,00,000
5 Intangible Assets :
Goodwill 2,70,000 1,60,000

Additional Information :
i. During the year, a piece of machinery costing Rs. 4,00,000 on which accumulated
depreciation was Rs. 73,000 was sold for Rs. 3,10,000.
ii. 9% Debentures of Rs. 1,00,000 were issued on 31st March, 2018. 6

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