Board Paper of Class 12-Commerce 2012 Accountancy All India(SET 2) - Solutions

Name an item which is never shown on the ‘Payments’ side of ‘Receipts and Payments Account’, but is shown as an Expenses while preparing ‘Income and Expenditure Account’  

A Partnership deed provides for the payments of interest on Capital but there was a loss instead of profit during the year 2010-2011. At what rate will the interest on capital be allowed?

Give any one distinction between sacrificing ratio and gaining ratio.

State any one purpose for admitting a new partner in a firm.

What is meant by calls in advance?

From the following information, calculate the amount of subscription due to be shown in the

‘Income and Expenditure Account’ for the year ended 31.3.2011 if there are 1000 members and each paying Rs 300 p.a. as subscription.

Subscription received during the year 2010 − 2011: Rs 3,00,000.

Subscription received in advance as on 31.3.2011: Rs 36,800.

Subscription outstanding as on 1.4.2010: Rs 32,000.

Subscription received in advance as on 1.4.2010: Rs 25,000

Sundram Ltd. Purchased Furniture for Rs 3,00,000 from Ravindram Ltd. Rs 1,00,000 were paid by drawing a Promissory Note in favour of Ravindram Ltd. The balance was paid by issue of

Equity Shares of Rs 10 each at a premium of 25%.

Pass necessary Journal entries in the book of Sundram Ltd.  

Nav Lakshmi Ltd. Invited application for issuing 3,000, 12% Debentures of Rs 100 each at a premium of Rs 50 per Debentures. The full amount was payable on application.

Applications were received for 4,000 debentures. Application for 1,000 debentures were rejected and application money was refunded. Debentures were allotted to the remaining applicants.

Pass necessary Journal entries for the above transaction in the books of Nav Lakshmi Ltd 

Lalan and Balan were partners in a firm sharing profits in the ratio of 3 : 2. Their fixed capitals on 1.4.2010 were : Lalan Rs 1,00,000 and Balan Rs 2,00,000. They agreed to allow interest on capital @ 12% per annum and to charge on drawing @ 15% per annum. The firm earned a profit, before all above adjustments of Rs 30,000 of the year ended 31.3.2011. The drawing before

Lalan and Balan during the year were Rs 3,000 and Rs 5,000 respectively. Showing your calculations, clearly prepare Profit and Loss Appropriation Account of Lalan and Balan. The interest on capital will be allowed even if the firm incurs a loss.  

A, B, C and D are partners sharing profits in the ratio of 3 : 3 : 2 : 2 respectively. D retires and A, B and C decide to share the future profits in the ratio of 3 : 2 : 1. Goodwill of the firm is valued at Rs 6,00,000. Goodwill already appears in the book at Rs 4,50,000. The profits for the first year after D’s retirement amount to Rs 12,00,000. Give the necessary Journal entries to record Goodwill and to distribute the profits. Show your calculations clearly.  

Sarvottam Ltd. Decided to redeem its 1250, 12% Debentures of Rs 100 each. It purchased 850 Debentures from the open market at Rs 96 per Debenture. The remaining Debenture were redeemed out of profit. The company has already made a provision for Debenture Redemption Reserve in its books.

Pass necessary Journal entries in the books of the company for the above transaction.

Pass necessary Journal entries for the following transaction in the books of Fortune Ltd:

(i) Redeemed Rs 1,92,000, 12% Debenture by conversion into Equity Shares of Rs 100 each.

The Equity Shares were issued at a discount 4%.

(ii) Converted 2,400, 12% Debentures of Rs 100 each into New 13% Debentures of Rs 100 each.

The new Debentures were issued at a premium 25%.

Sudha and Joshi were partners in a firm sharing profits in the ration of 3 : 7. On 31.3.2011 their

Balance Sheet was as follows:

The firm was dissolved on 1.4.2011 and the Assets and Liabilities were settled as follows:

(i) Creditors accepted Debtors in full settlement of their claim.

(ii) Land and Building was sold for Rs 7,00,000 and Machinery was taken over by Joshi by paying cash less than 30% of its books value.

Pass necessary Journal entries for dissolution of the firm.

From the following Receipts and Payments Account of Kolkata Sports Club for the year ended

31.3.2011, prepare Income and Expenditure Account.

Atal and Madan were partners in a firm sharing profits in the ratio of 5 : 3. On 31.3.2011 they admitted Mehra as a new partner fro 1/5^th share in the profits. The new profit sharing ratio was 5 : 3 : 2. On Mehra’s admission the Balance Sheet to the firm was as follows:

On Mehra’s admission it was agreed that

(i) Mehra will bring Rs 40,000 as his capital and Rs 16,000 for his share of goodwill premium, half of which was withdraw by Atal and Madan;

(ii) A provision of for bad and doubtful debts was to be created;

(iii) Included in the sundry creditors was an item of Rs 2,500 which was not to be paid;

(iv) A provision was to be made for an outstanding bill for electricity Rs 3,000;

(v) A claim of Rs 325 for damage against the firm was likely to be admitted. Provision for the same was to be made.

After the above adjustment, the capitals of Atal and Madan were to be adjusted on the basis of

Mehra’s capital. Actual cash was to be brought in or to be paid off to Atal and Madan as the case may be.

Prepare Revaluation Account, Capital Accounts of the partners and the Balance Sheet of the new firm.

OR

Khanna, Seth and Mehta were partners in a firm sharing profit in the ratio of 3 : 2 : 5. On 31.12.2010 the Balance Sheet of Khana, Seth and Mehta was as follows:

On 14^th March 2011, Seth died.

The partnership deed provides that on the death of a partner the executor of the deceased partners is entitled to:

(i) Balance in Capital Account;

(ii) Share in profits upto the date of death on the basis of last year’s profit;

(iii) His share in profit/loss in revaluation of assets and re-assessment of liabilities which were as follows:

(a) Land and Building was to be appreciated by Rs 1,20,000;

(b) Machinery was to be depreciated to Rs 1,35,000 and stock to Rs 25,000;

(c) A provision of for bad and doubtful debts was to created on debtors;

(iv) The net amount payable to Seth’s executors was transferred to his loan account which was to be paid later.

Prepare Revalution Account, Partners Capital Accounts, Seth’s Executors Account and the

Balance Sheet of Khanna and Mehta who decided to continue the business keeping their capital balances in their new profit sharing ratio. Any surplus of deficit to be transferred the current account of the partners.

R.K. Ltd. invited applications for issuing 70,000 Equity Shares of Rs 10 each at a premium of Rs 35 per share. The amount was payable as follows:

On Application Rs 15 per share (including Rs 12 Premium)

On Allotment Rs 10 per share (including Rs 8 Premium)

On First and Final Call- Balance

Applications for 65,000 shares were received and allotment was made to all the application. A shareholder, Ram who was allotted 2,000 shares were failed to pay the allotment money. His shares were forfeited immediately after allotment. Afterwards the first and final call was made. Sohan, who had 3000 shares failed to pay the first and final call. His shares were also forfeited. Out of the forfeited shares 4,000 shares were re-issued at Rs 50 per share fully paid up. The re-issued shares included all the shares of Ram.

Pass necessary Journal Entries for the above transactions in the books of R.K. Ltd.

OR

Ashish Ltd. Invited applications for issuing 75,000 Equity Shares of Rs 10 each at a discount of 10%. The amount was payable as follows:

On Application Rs 2 per share.

On Allotment Rs 2 per share

On First and Final Call − Balance

Applications for 1,50,000 shares were received. Applications for 25,000 shares were rejected and the application money of these applicants was refunded. Shares were allotted on pro-rata basis to the remaining applicants. Excess money received with applications was adjusted towards sums due on allotment. Suman who had applied for 1250 shares failed to pay allotment and first and final call money. Dev did not pay the first and final call on his 100 shares. All these share were forfeited and later on 1000 of these share were re-issued at Rs 17 per shares fully paid up. The re-issued shares included all the shares of Suman.

Pass necessary Journal Entries for the above transactions in the books of Ashish Ltd.