D0683_BK_PP_05

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SOLUTION : PRACTICE PAPER 5

Q. 1. (A) (1) Bills Payable

(2) Net Profit

(3) Building

(4) Bank

(5) Sole Proprietor

Q. 1. (B) (1) lawful

(2) Nominal

(3) debited

(4) Capital Reserve

(5) Ready to use

Q. 1. (C) (1) Partners

(2) Deficit

(3) Goodwill

(4) Reserve Fund or General Reserve

(5) Liquid Assets

Q. 1. (D) (1) Disagree

(2) Agree

(3) Agree

(4) Agree

(5) Disagree

Q. 2. Solution : In the books of the Partnership firm


Dr. Profit and Loss Adjustment Account Cr.

Amount Amount
Particulars Particulars
(`) (`)
To R.D.D. (New) A/c 3,200 By Stock A/c 2,000
To Depreciation A/c – Furniture 4,400 By Land and Building A/c 6,400
To Profit on Revaluation Transferred
to Partners’ Capital A/cs :
Yash 600
Mohit 200 800
8,400 8,400

SOLUTIONS TO NAVNEET PRACTICE PAPERS : STD. XII (B.K.) 1


Dr. Partners’ Capital Accounts Cr.

Yash Mohit Nirmal Yash Mohit Nirmal


Particulars Particulars
(`) (`) (`) (`) (`) (`)
To Cash A/c 27,600 9,200 – By Balance b/d 1,20,000 40,000 –
To Balance c/d 1,20,000 40,000 40,000 By Cash A/c – – 40,000
By Goodwill A/c 15,000 5,000 –
By Profit and Loss
Adjustment A/c 600 200 –
(Profit)
By General Reserve
A/c 12,000 4,000 –
1,47,600 49,200 40,000 1,47,600 49,200 40,000

Balance Sheet of new firm as on 1st April, 2024

Amount Amount Amount Amount


Liabilities Assets
(`) (`) (`) (`)
Capital A/cs : Cash 1,03,200
Yash 1,20,000 Sundry Debtors 64,000
Mohit 40,000 Less : R.D.D. (New) 3,200 60,800
Nirmal 40,000 2,00,000 Land and Building 32,000
Sundry Creditors 80,000 Add : Appreciation (20%) 6,400 38,400
Bills Payable 20,000 Stock 40,000
Bank Overdraft 22,000 Add : Appreciation (5%) 2,000 42,000
Furniture 22,000
Less : Depreciation (20%) 4,400 17,600
Plant and Machinery 60,000
3,22,000 3,22,000

OR

Q. 2. Solution : In the books of the Partnership Firm


Dr. Profit and Loss Adjustment Account Cr.

Debit Credit
Particulars Particulars
(`) (`)
To Furniture A/c 13,500 By Freehold Property A/c 13,500
To Partners’ Capital A/cs : By Machinery A/c 4,500
Bhavya 3,600 By R.D.D. A/c 4,500
Hriday 3,600
Uday 1,800 9,000

22,500 22,500

2 NAVNEET PRACTICE PAPERS : STD. XII (COMMERCE)


Dr. Partners’ Current Account Cr.

Bhavya Hriday Uday Bhavya Hriday Uday


Particulars Particulars
(`) (`) (`) (`) (`) (`)
To Goodwill A/c 2,700 2,700 1,350 By Balance b/d 1,80,000 1,35,000 67,500
(Written off) By General
To Uday’s Loan A/c – – 72,450 Reserve A/c 9,000 9,000 4,500
To Balance c/d 1,89,900 1,44,900 – By Profit and Loss
Adjustment A/c 3,600 3,600 1,800
1,92,600 1,47,600 73,800 1,92,600 1,47,600 73,800

Balance Sheet of the new firm as on 1st April, 2024

Amount Amount Amount Amount


Liabilities Assets
(`) (`) (`) (`)
Partners’ Capital A/cs : Bank 22,500
Bhavya 1,89,900 Debtors 90,000
Hriday 1,44,900 3,34,800 Furniture 67,500
Uday’s Loan A/c 72,450 Less : Depreciation 13,500 54,000
Creditors 45,000 Machinery 18,000
Add : Appreciation 4,500 22,500
Freehold Property 1,21,500
Add : Appreciation 13,500 1,35,000
Goodwill 1,35,000
Written off 6,750 1,28,250
4,52,250 4,52,250

Working Notes :
Valuation of Goodwill :
(1) Total profit = 4,500 + 47,250 + 45,000 + 72,000 + 45,000 = ` 2,13,750.

Total Profit 2,13,750


(2) Average profit = = = ` 42,750
No. of years 5

(3) Goodwill = Average profit × No. of years of purchase


= 42,750 × 3 = ` 1,28,250

(4) Goodwill to be written off = 1,35,000 − 1,28,250 = ` 6,750.

SOLUTIONS TO NAVNEET PRACTICE PAPERS : STD. XII (B.K.) 3


Q. 3. Solution : In the books of Partnership firm
Dr. Realisation Account Cr.

Amount Amount Amount Amount


Particulars Particulars
(`) (`) (`) (`)
To Sundry Assets A/c By Sundry Liabilities A/c
Furniture 1,40,000 Creditors 28,000
Sundry Debtors 70,000 Bills Payable 14,000 42,000
Stock of goods 98,000 3,08,000 By Bank A/c
To Bank A/c Furniture 84,000
Creditors 25,200 Sundry Debtors 42,000 1,26,000
Bills Payable 12,600 37,800 By Zalak’s Capital A/c 70,000
By Partners’ Capital A/cs
(Loss)
Zalak 53,900
Keyur 32,340
Prihaan 21,560 1,07,800
3,45,800 3,45,800

Dr. Partners’ Capital Accounts Cr.

Zalak Keyur Prihaan Zalak Keyur Prihaan


Particulars Particulars
(`) (`) (`) (`) (`) (`)
To Balance b/d – – 28,000 By Balance b/d 2,10,000 1,12,000 –
To Realisation A/c 70,000 – – By General Reserve
(Stock of goods) A/c 7,000 4,200 2,800
To Realisation A/c 53,900 32,340 21,560 By Zalak’s Capital
(Loss) A/c – – 29,225
To Prihaan’s By Keyur’s Capital
Capital A/c 29,225 17,535 – A/c – – 17,535
To Bank A/c 63,875 66,325 –
2,17,000 1,16,200 49,560 2,17,000 1,16,200 49,560

Dr. Bank Account Cr.

Amount Amount
Particulars Particulars
(`) (`)
To Balance b/d 42,000 By Realisation A/c 37,800
To Realisation A/c 1,26,000 By Zalak’s Capital A/c 63,875
By Keyur’s Capital A/c 66,325
1,68,000 1,68,000

4 NAVNEET PRACTICE PAPERS : STD. XII (COMMERCE)


Working Notes :
(1) Total Sundry debtors − Insolvent debtors = Good debtors
= 70,000 − 28,000 (Haresh) = ` 42,000.
(2) Distribute General Reserve in 5 : 3 : 2 ratio.
(3) Prihaan became insolvent and his outstanding amount ` 46,760
(49,560 (Dr.) − 2,800 (Cr.)) is to be borne by remaining partners in 5 : 3 ratio
5
i.e. For Zalak : 46,760 × = ` 29,225
8
3
For Keyur : 46,760 × = ` 17,535
8
OR

Q. 3. Solution : In the books of Moksh


Journal Entries

Date/ Debit Credit


Particulars L.F.
No. Amount (`) Amount (`)
1 Poojan’s A/c Dr. 80,000
To Bill Payable A/c 80,000
(Being acceptance given for balance payable)
2 Bills Payable A/c Dr. 80,000
To Poojan’s A/c 80,000
(Being the bill cancelled at our request)
3 Interest A/c Dr. 500
To Poojan’s A/c 500
(Being interest due on balance payable)
4 Poojan’s A/c Dr. 60,500
To Cash A/c 60,500
(Being part of the amount along with interest paid)
5 Poojan’s A/c Dr. 20,000
To Bill Payable A/c 20,000
(Being the acceptance given for balance amount
payable)
6 Bills Payable A/c Dr. 20,000
To Poojan’s A/c 20,000
(Being bill dishonoured for non-payment of bill
amount)
7 Poojan’s A/c Dr. 20,000
To Cash/Bank A/c 7,000
To Deficiency A/c 13,000
(Being 35% of the amount due paid and balance
amount suffered as deficiency)
Total 2,81,000 2,81,000

SOLUTIONS TO NAVNEET PRACTICE PAPERS : STD. XII (B.K.) 5


Working Note :
10 3
• Interest on ` 20,000 for 3 months @ 10% = 20,000 × × = ` 500.
100 12

Q. 4. Solution : In the books of Nisarg Co. Ltd.


Journal Entries

Date/ Debit Credit


Particulars L.F.
No. Amount (`) Amount (`)
1 Bank A/c Dr. 72,000
To Equity Share Application A/c 72,000
(Being application money on 24,000 equity shares
@ ` 3 per share received)
2 Equity Share Application A/c Dr. 72,000
To Equity Share Capital A/c 60,000
To Bank A/c 12,000
(Being application money on 20,000 shares transferred
to Share Capital A/c and remaining money refunded)
3 Equity Share Allotment A/c Dr. 1,40,000
To Equity Share Capital A/c 60,000
To Share Premium A/c 80,000
(Being allotment money on 20,000 equity shares
@ ` 7 per share including premium is due)
4 Bank A/c Dr. 1,40,000
To Equity Share Allotment A/c 1,40,000
(Being share allotment money received)
5 Equity Share First and Final Call A/c Dr. 80,000
To Equity Share Capital A/c 80,000
(Being equity share first and final call money on
20,000 share @ ` 4 per share is due)
6 Bank A/c Dr. 79,840
To Equity Share First and Final Call A/c 79,840
(Being share first and final call on 19,960 shares
@ ` 4 per share received)
7 Equity Share Capital A/c Dr. 400
To Equity Share First and Final Call A/c 160
To Share Forfeiture A/c 240
(Being forfeiture of 40 equity shares due to non-
payment of first and final call)
Total 5,84,240 5,84,240

Working Note :
40 shares amount not received ∴ Amount received from him ` 240 (40 × (3 + 3)) is forfeited.

OR

6 NAVNEET PRACTICE PAPERS : STD. XII (COMMERCE)


Q. 4. Comparison / Difference between Manual Accounting Process and Computerised Accounting
System.
Ans.

Basis of Difference Manual Accounting Computerised Accounting


(1) Meaning Manual accounting is the system in Computer accounting is the system in
which each business transactions are which transactions are recorded by
recorded in books of accounts like using computers and accounting
journal and ledger. software for digital record.
(2) Calculation and total In this system, all calculations are In this system, all calculations are
done manually. done by computer system.
Here, balance of each accounts are to Here, balance of each accounts are
be found out by making total of debit calculated / found automatically.
and credit side
(3) Ledger Accounts From the journal, recorded Here, once a voucher is entered, it
transactions have to be posted in will automatically posted in the
different ledger accounts manually, so different ledger accounts without any
chances of mistake is always there. mistake.
(4) Trial Balance After posting, trial balance is to be Trial balance is automatically prepared
prepared by taking balance of each using accounting software.
ledger accounts.
(5) Record of Adjustment journal entries and its Adjustment entries are to be passed
Adjustment Entries posting in the ledger accounts will be in the system and posting in the ledger
done manually one by one. accounts will be done automatically.
(6) Financial Statements Financial Statements are prepared With the help of accounting software,
manually by transferring trial balance such financial statements are
figures carefully. automatically prepared after recording
adjustment entries.
(7) Closing the books After close of every year; in the There is no need for recording opening
beginning of year, opening balances balances as the balances are
are required to be carried forward in automatically carried forward to next
new books of accounts. year.

Q. 5. Solution : In the books of Partnership firm


Dr. Profit and Loss Adjustments Account Cr.

Amount Amount
Particulars Particulars
(`) (`)
To Motor Car A/c 880 By Stock of Goods A/c 2,400
To Partners’ Capital A/cs : (Profit) By R.D.D. A/c 640
Sonu 864
Monu 864
Dinu 432 2,160
3,040 3,040

SOLUTIONS TO NAVNEET PRACTICE PAPERS : STD. XII (B.K.) 7


Dr. Partners’ Capital Accounts Cr.

Sonu Monu Dinu Sonu Monu Dinu


Particulars Particulars
(`) (`) (`) (`) (`) (`)
To Executor’s Loan By Balance b/d 32,000 32,000 16,000
A/c – – 17,632 By Goodwill A/c 1,600 1,600 800
To Balance c/d 34,464 34,464 – By Profit and Loss
Adjustment A/c 864 864 432
By Profit and Loss
Suspense A/c – – 400
34,464 34,464 17,632 34,464 34,464 17,632

Balance Sheet of the new firm as on 1st July, 2024

Amount Amount Amount Amount


Liabilities Assets
(`) (`) (`) (`)
Partners’ Capital A/cs : Machinery 44,640
Sonu 34,464 Sundry Debtors 16,640
Monu 34,464 68,928 Motor Car 12,800
Sundry Creditors 25,600 Less : Depr. 880 11,920
Profit and Loss Suspense
A/c 400
Bank 8,928
Goodwill 12,000
94,528 94,528

Working Notes :
(1) Difference of amount of Goodwill (` 12,000 − ` 8,000) ` 4,000 is to be distributed among partners in
2 : 2 : 1 ratio as it is to be raised in the books.
1
∴ Dinu’s share in Goodwill = 4,000 × = ` 800
5
(2) Dinu’s share in profit = Profit of the current year (Estimated) × Period × Share of partner
3 1
= 8,000 × × = ` 400
12 5
= ` 400 (Profit and Loss Suspense A/c)

(3) Amount due to Dinu’s Executor is immediately cleared. So, no entry is to be passed in the Balance
Sheet.

OR

8 NAVNEET PRACTICE PAPERS : STD. XII (COMMERCE)


Q. 5. Solution : Vertical Income Statement
For the year ended 31st March, 2024

Amount Amount
Sr. No. Particulars
(`) (`)
1. Sales 1,80,000

2. Less : Cost of goods sold


Opening stock 30,000
Purchases 1,35,000
Carriage Inward 15,750
1,80,750
Less : Closing stock 45,000 1,35,750
3. Gross profit 44,250
4. Less : Operating expenses
Administrative expenses 18,750
Selling expenses 15,000
Finance expenses 4,500
5. Total operating expenses 38,250
6. Net profit 6,000

Q. 6. Solution : In the books of Mahavir Engineering College,


Dr. Income and Expenditure Account for the year ended 31st March, 2024 Cr.

Amount Amount Amount Amount


Expenditure Income
(`) (`) (`) (`)
To Salaries to teaching By Interest 45,000
staff 5,00,000 By Subscription 15,000
To Electricity charges 25,000 Add : O/s Subs. 2,650 17,650
To Stationery 12,000 By Donation 2,50,000
To Depreciation : Less : Transfer to
Books 32,000 Building fund (50%) 1,25,000 1,25,000
Furniture 37,000 69,000 By Tuition fees 5,75,000
To Surplus (Excess 2,86,650 By Admission fees 30,000
of income over By Term fees 1,00,000
expenditure)
8,92,650 8,92,650

SOLUTIONS TO NAVNEET PRACTICE PAPERS : STD. XII (B.K.) 9


Balance Sheet as on 31st March, 2024

Amount Amount Amount Amount


Liabilities Assets
(`) (`) (`) (`)
Capital Fund : 5,18,500 Books 3,50,000
Add : Surplus 2,86,650 8,05,150 Add : Newly purchased 32,000
Building Fund 5,00,000 3,82,000
Add : 50% Donation 1,25,000 6,25,000 Less : Depreciation 32,000 3,50,000
Furniture 1,59,500
Add : Addition 27,500
1,87,000
Less : Depreciation 37,000 1,50,000
Fixed Deposit 4,55,000
Add : Addition 3,50,000 8,05,000
O/s Subscription 2,650
Bank 1,22,500
14,30,150 14,30,150

Working Notes :
(1) 50% of donation (` 1,25,000) − Add it to Building fund and remaining (` 1,25,000) amount, record it
on the Income side (Cr.) of Income and Expenditure A/c.
(2) Admission fees (Revenue) − Record it on Income side.

Q. 7. Solution : In the books of Kalpana and Bela


Dr. Trading account for the year ended 31st March, 2024 Cr.

Amount Amount Amount Amount


Particulars Particulars
(`) (`) (`) (`)
To Opening stock 21,360 By Sales 1,44,000
To Purchases 66,000 Less : Goods return 600 1,43,400
Less : Goods return 1,200 64,800 By Closing stock 44,400
To Gross profit c/d 1,01,640

1,87,800 1,87,800

Dr. Profit and Loss Account for the year ended 31st March, 2024 Cr.

Amount Amount Amount Amount


Particulars Particulars
(`) (`) (`) (`)
To Salaries 5,160 By Gross profit b/d 1,01,640
Add : O/s salaries 420 5,580
To Annual Subscription 5,400
To Stationery expense 5,760
To Depreciation on Plant
and Machinery 4,800
To Bad debts (New) 1,008

10 NAVNEET PRACTICE PAPERS : STD. XII (COMMERCE)


To Interest on Capital :
Kalpana 5,400
Bela 1,800 7,200
To Net Profit c/d
(Transferred to Partners’
Current A/cs) :
Kalpana 53,919
Bela 17,973 71,892
1,01,640 1,01,640

Balance Sheet as on 31st March, 2024

Amount Amount Amount Amount


Liabilities Assets
(`) (`) (`) (`)
Capital A/cs : Fixed assets 96,000
Kalpana 1,08,000 Less : Depr. (5%) 4,800 91,200
Bela 36,000 1,44,000 Investments 63,480
Current A/cs : Debtors 33,600
Kalpana 65,319 Less : Bad debts (New) 1,008 32,592
Bela 23,373 88,692 Cash Balance 61,200
Creditors 59,760 Closing stock 44,400
O/s Salary 420
2,92,872 2,92,872

Dr. Partners’ Current Accounts Cr.

Kalpana Bela Kalpana Bela


Particulars Particulars
(`) (`) (`) (`)
To Balance c/d 65,319 23,373 By Balance b/d 6,000 3,600
By Interest on Capital 5,400 1,800
By Profit and Loss
(Net profit) 53,919 17,973
65,319 23,373 65,319 23,373

Working Note :
Write Partners’ related amounts (Current A/c Balances, Interest on Capital and Net profit) in the Partners’
Current A/cs to get Current A/c balances, to be recorded in the Balance Sheet.
________

SOLUTIONS TO NAVNEET PRACTICE PAPERS : STD. XII (B.K.) 11

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