Roll No.

L M Thapar School of Management

Thapar Institute of Engineering and Technology, Patiala (DeIabassi Campus)
Mid-Semester Examination - 2

MBA (Sem-l) 2022-24 AC5302: Financial Accounting and Reporting

Date: 14 October 2022 Instructor: Dr. Pradeep Kumar Gupta
Time: 75 minutes; Maximum Marks: 20

Instructions:
1. Attempt all questions. Marks are indicated against each question.
2. Questions must be answered in sequence either ascending or descending order. Fail to answer in sequence, the
penalty of five marks in total score is levied. i
3. Use of a simple calculator is allowed.
4. Working notes should form a part of your answers.
5. To the point answers oftheoretical questions are expected.
6. No clarifications should be sought during the exam. The appropriate assumptions can be written in case of
doubt in any question.
7. Very neat and clean answers are desirable.

01 (CLOll: (2.5)
Differentiate financial accounting and management accounting (five relevant points only).

02 (CLOll: (2.5)
Define 'Asset' and 'Expense' elements of Financial Statements. What are two 'criteria to recognize them in the financial
statements?

03 (CL02l: (2.5)
The concept of 'Conservatism' is an exception of 'Cost' concept. Discuss the statement with a suitable example.

04 (CL02l: (2.5)
The following table shows the inventory purchased and sold by a firm in last five months. The firm follows the
perpetual system for recording & accounting and LIFO method for valuing the inventory. You are required to give only
journal entries for these purchased and sold inventory with relevant T-accounts (ignore the preparation of inventory
table).

YEAR NUMBER OF COST PRICE PER NUMBER OF SALE PRICE

BOTTLES PURCHASED BOTTLE BOTTLES SOLD PER BOTILE
RS. RS.
MAY 2022 200 2 100 15
JUNE 2022 200 4 100 15
JULY 2022 200 6 .
100 15
AUGUST 2022 200 8 100 15
SEPTEMBER 2022 200 10 100 15

ll Pa g e AC5302: Financi8l Accounting and Reporting M ST - 2

05 (CL031: (2.5)
Prepare the Balance Sheet from the following final ledger balances on 31" March 2022.
Name of Acc01mt Amount (Rs.) Name of Account Amount (Rs.)
Cash & Bank 68000 Inventory 38000
Equity Share Capital 128000 Bank Overdrafr 28000
Loan from Bank 60000 Retained Earnings 40000
Debtors 42000 Fixed Assets 200000
Bills Payable 42000 Deposits from Public 12000
Outstanding Expenses 4000 Creditors 38000
Commission Receivable 8000 Tax Payable 4000

06 (CL03): (2.5)
Determine Cash collected from customers, Cost of goods sold, Cash wage expenses paid, Cash paid to suppliers, and
Cash insurance expenses paid , from the given below information during the financial year 2021-22
Name of Account 01.04.2021 31.03.2022 Other Accounts Information Amount
Accounts Receivable 8775 12225 Credit Purchases 26000
Merchandise Inventory 5995 9595 Sales (50% cash; 50% credit) . 52000
Wage Expenses Payable 3555 2255 Cash Purchases 26000
Accounts Payable 12225 8775 Wages expenses to P&L AIc 4555
Prepaid Insurance 2255 3555 Insurance Expense to P&L Alc 4555

07 (CL031: (5.0)
From the following trial balance of Sanara Ltd., prepare an Income Statement for the year ended 31st December 2021
and a Balance Sheet at that date after taking the given below and hidden adjustments.
Trial Balance
S.No. Name of Account Dr. Balances (Rs.) Cr. Balances (Rs.)
I Sales 126500
2 Purchases 99850
3 Cash at Bank 22000
4 Cash in Hand 48000
5 Bank loan @IO% per annum 100000
6 Business Premises 75000
8 Plant 15700
10 Wages and Salaries 8900
11 Rent paid 7500
12 Opening Inventory 5000
13 Equity Share Capital 80000
14 Drawings 25000
15 Carriage Inwards 4000
16 Account Receivables 27500
17 Bad Debts 5000
18 Account Payables 16000
19 Bank Overdraft 20950
Total Rs. 343450 343450

Adjustments:
1. Closing inventory is found to be Rs. 12,500.
2. Wages and salaries of Rs. 700 for the month of December 2021 are yet to be paid.
3. Rent paid includes the prepaid rent amount of Rs. 300.
4. Depreciation is to be charged at 2 per cent on Business premises, and at 10 per cent on Plant.

2 P It ge AC5302: Financial Accounting and Reporting M ST - 2