Board Paper of Class 12-Commerce 2011 Accountancy (SET 1) - Solutions

Roger and Suresh sharing profits and losses in the ratio of 3 : 2 jointly agreed to underwrite the subscription of 60,000 equity shares of Rs 10 each of Parag and Company Limited at a premium of Rs 3 per share. The underwriting commission is 4% as provided in the Articles. Applications were received from the public only for 40,000 shares and so the underwriters took over the remaining shares. A joint bank account was opened towards which Roger contributed Rs 55,000 and Suresh Rs 45,000. A sum of Rs 7,000 was incurred on various expenses which were paid out of the joint bank account. Parag and Company paid the underwriting commission by cheque. At the close of the venture, the underwriters sold 12,000 shares at the rate of Rs 15 per share and the rest of the shares were taken up by them at the rate of Rs 14 per share, in their profit and loss sharing ratio.                            [14 Marks]

Prepare : VIEW SOLUTION

Mr. Khanna maintains his books on sectional balancing ledgers.                [14 Marks]
 

Transactions	Amount (Rs)	Transactions	Amount (Rs)
Total Sales	1,35,000	Credit Sales	1,16,000
Purchases (Credit)	72,700	Purchases (Cash)	11,800
Bad debts written off	1,000	Provision for bad and doubtful debts	720
Purchases returns (out of credit purchases)	2,500	Amount received against bad debtors written off last year	600
Discount received	300	Cash collected from debtors	83,000
Bills receivable received (excluding bills renewed)	57,500	Noting charges debited to debtors	592
Bills receivable renewed	10,000	Bills payable accepted	8,000
Sold ledger (Cr.) on 30.11.10	260

On 01.11.2010, Bought Ledger (Cr.) Rs 30,000 and Sold Ledger (Dr.) Rs 60,000.

From the above particulars, prepare Control Accounts in the relevant ledger. VIEW SOLUTION

Given below is the Balance Sheet of Gurmeet and Company Limited as on 31st December, 2009 and 31st December, 2010 :

[14 Marks]

Balance Sheet
Liabilities	2009 Amount (Rs)	2010 Amount (Rs)	Assets	2009 Amount (Rs)	2010 Amount (Rs)
Equity Share Capital	3,00,000	3,50,000	Goodwill	1,00,000	80,000
General Reserve	1,00,000	1,50,000	Machinery	3,20,000	4,10,000
Profit and Loss A/c	60,000	70,000	12% Investments	30,000	80,000
11% Debentures	1,50,000	2,50,000	Stock	40,000	55,000
Creditors	75,000	1,10,000	Debtors	80,000	1,90,000
Bills Payable	10,000	15,000	Bank	1,20,000	1,30,000
			Debenture Discount	5,000	–
	6,95,000	9,45,000		6,95,000	9,45,000

Additional Information:

(a) Investments costing Rs 36,000 were sold for Rs 30,000 during the year 2010.

(b) New debentures have been issued at the end of the current accounting year.

(c) New investments have been purchased at the end of the current accounting year.

(d) Depreciation charged on machinery during the current accounting year was Rs 10,000
 
From the above information, prepare a Cash Flow Statement as per Accounting Standard-3. VIEW SOLUTION

Ahmed, Bina and Chitra are partners sharing profits and losses in the ratio of 3 : 2 : 1. Their balance sheet as on 31st March, 2010 stood as under :

[14 Marks]

 

Balance Sheet as on 31st March, 2010
Liabilities		Amount (Rs)	Assets		Amount (Rs)
Ahmed’s Capital		1,50,000	Equipment		3,00,000
Bina’s Capital		1,00,000	Furniture		50,000
Chitra’s Capital		50,000	Stock		75,000
General Reserve		1,20,000	Debtors		80,000
Bills Payable		20,000	Cash		10,000
Creditors		75,000
		5,15,000			5,15,000

Ahmed died on 31.03.2010 and the following decisions were taken by the surviving partners according to the partnership deed :
The firm had a joint life policy of Rs 90,000. The policy was surrendered and the death claim was realized in full by cheque from the insurance company.
The surviving partners finally agreed that the values of assets and liabilities must remain the same and as such, there must not be any change in their book values as a result of the above mentioned adjustments, except the bank balance.
The amount payable to Ahmed was transferred to his executor’s account.
Prepare Partners’ Capital Account and a Balance Sheet of Bina and Chitra. VIEW SOLUTION

Sachdeva Tyres and Company Limited issued applications for 1,00,000 equity shares of Rs 10 each at a premium of Rs 3 per share. The amount was payable as follows :       [14 Marks]   
(i) On application : Rs 2
(ii) On allotment : Rs 5 (including premium)
(iii) Balance on the first and the final call.

Applications were received for 1,50,000 shares. Allotment was made pro-rata to all applicants. Sudhir who had applied for 300 shares failed to pay allotment and call money. His shares were forfeited after the first and the final call. Of these, 170 shares were reissued to Pramod at Rs 9 per share fully paid.
Pass the necessary Journal Entries to show the above transaction. Show your working clearly. VIEW SOLUTION

(a)	Gurung Ltd. took over assets of Rs 6,00,000 and liabilities of Rs 60,000 from Batra Ltd. for the purchase consideration of Rs 5,50,000. It paid the purchase consideration by issuing 8% debentures of Rs 100 each at 10% premium.	[14 Marks]
(b)	Gurung Ltd. purchased land from Jaiswal Ltd. for Rs 4,50,000. The consideration was paid by issuing 5% debentures at a discount of 10%.
(c)	Gurung Ltd. issued 1,000, 6% debentures of Rs 100 each at a discount of 7% repayable after 5 years at a premium of 10%.
From the above particulars, pass journal entries in the books of Gurung Ltd. to record the transactions.

VIEW SOLUTION

David and Bimal are partners sharing profits and losses in the ratio 3 : 2. Their Balance Sheet as on 31st March, 2010 was as follows :

[14 Marks]

 

Balance Sheet as on 31st March, 2010
Liabilities		Amount (Rs)	Assets		Amount (Rs)
Sundry Creditors		82,000	Cash		32,000
General Reserve		3,000	Stock		15,000
Capital A/c :			Debtors	9,400
David	18,000		Less : Prov. for DD	400	9,000
Bimal	12,000	30,000	Building		55,000
			Furniture		4,000
		1,15,000			1,15,000

They admitted Chander as a new partner on 1.4.2010 and the new profit sharing ratio became 5 : 3 : 2. Chander introduced a capital of Rs 16,000. Chander was unable to bring any cash for goodwill and so it was decided to value the goodwill on the basis of his share in the profits and the capital contributed by him. The following revaluations were made at the time of Chander’s admission :
Prepare the Revaluation account, Partners’ capital accounts and a Balance Sheet of the new firm on the date of Chander’s admission. Show your working clearly. VIEW SOLUTION

The following figures have been extracted from the books of Arvind and Company Limited :
                                                                                                                [14 Marks]
 

Particulars	Amount     (Rs)
Net sales	12,00,000
Net purchases	5,00,000
Administrative expenses	65,000
Selling and distribution expenses	35,000
Gross profit	20% on Sales
Net profit after tax	10,00,000
Total assets	40,00,000
Equity share capital of Rs 10 each	10,00,000
10% Preference share capital of Rs 10 each	3,00,000
Reserves and surplus	2,00,000
8% Debentures	8,00,000
Opening debtors	1,20,000
Closing debtors	80,000
Opening bills receivable	60,000
Closing bills receivable	40,000
Opening creditors	1,30,000
Closing creditors	70,000
Closing bills payable	50,000
Opening bills payable	1,00,000

 
From the above information, calculate the following :  
Note : All calculation are to be made to two places of decimal. VIEW SOLUTION