Board Paper of Class 12-Commerce 2015 Accountancy Abroad(SET 3) - Solutions

General Instructions:
1) This question paper contains two parts A and B.
2) Part A is compulsory for all.
3) Part B has two options-Financial statement Analysis and Computerised Accounting.
4) Attempt only one option of Part B.
5) All parts of a question should be attempted at one place.

Section A
i. This section consists of 17 questions.
ii. All the questions are compulsory.
iii. Question Nos. 1 to 6 are very short-answer questions carrying 1 mark each.
iv. Question Nos. 7 to 10 carry 3 marks each.
v. Question Nos. 11 and 12 carry 4 marks each.
vi. Question Nos. 13 to 15 carry 6 marks each.
vii. Question Nos. 16 and 17 carry 8 marks each.

Section B
i. This section consists of 6 questions.
ii. All questions are compulsory
iii. Question Nos. 18 and 19 are very short-answer questions carrying 1 mark each.
iv. Question Nos. 20 to 22 carry 4 marks.
v. Question No. 23 carries 6 marks.

Question 1

'Samta Limited' invited applications for issuing 6,750 equity shares of Rs 10 each. The amount was payable as follows :

On application − Rs 3 per share
On allotment − Rs 5 per share
On first and final call − Rs 2 per share

The issue was fully subscribed. Subhash applied for 250 shares and paid his entire share money with application. Moti applied for 175 shares and paid allotment money also with application. The amount received with applications was :
(a) Rs 16,750
(b) Rs 16,000
(c) Rs 19,250
(d) Rs 22,875
VIEW SOLUTION

Question 2
Give the meaning of forfeiture of shares. VIEW SOLUTION

Question 3
Deepak, Farukh and Lilly were partners in a firm sharing profits in the ratio of 3 : 2 : 1. On 28.2.2015 Farukh retired from the firm. On Farukh's retirement there was a balance of Rs 12,000 in Workmen's Compensation Reserve which was no more required. On Farukh's retirement this amount will be :

(a) Debited to the Capital accounts of all the partners in their profit sharing ratio.
(b) Credited to the Capital accounts of all the partners in their profit sharing ratio.
(c) Credited to the Capital accounts of Deepak and Lilly in their profit sharing ratio.
(d) Credited to the Capital account of Farukh. VIEW SOLUTION

Question 4

Anurag and Bhawana entered into partnership on 1.4.2014. On 1.1.2015 they admitted Monika as a new partner for $\frac{3}{10} th$ share in the profits which she acquired equally from Anurag and Bhawana. The new profit sharing ratio of Anurag, Bhawana and Monika was 4 : 3 : 3. Calculate the profit sharing ratio of Anurag and Bhawana at the time of forming the partnership.
VIEW SOLUTION

Question 5

Kamal and Vimal were partners in a firm sharing profits in the ratio of 3 : 2. Ghosh was admitted as a new partner for $\frac{1}{5} th$ share in the profits.

On Ghosh's admission the Balance Sheet of the firm showed a credit balance of Rs 10,000 in its Profit and Loss Account which was debited by the accountant of the firm in the accounts of Kamal and Vimal. Did the accountant give correct treatment to the balance of Profit and Loss Account? If 'yes' give the reason and if 'not' give the correct treatment.
VIEW SOLUTION

Question 6
In the absence of partnership agreement, interest on drawings of a partners is charged :

(i) at 6% per annum.
(ii) at 9% per annum.
(iii) at 12% per annum.
(iv) no interest is charged. VIEW SOLUTION

Question 7
State any three conditions for the issue of shares at discount. VIEW SOLUTION

Question 8

K and L were partners in a firm sharing profits in the ratio of 3 : 2. On 1.4.2014 their Balance Sheet was as follows :

Liabilities		Amount Rs	Assets	Amount Rs
Capitals :			Sundry Assets	1,80,000
K	80,000
L	1,00,000	1,80,000
		1,80,000		1,80,000

The profit for the year ended 31.3.2014, Rs 90,000 was divided between the partners without allowing interest on capital at 6% per annum and a salary to K at Rs 4,000 per quarter. During the year K withdrew Rs 20,000 and L withdrew Rs 27,000.
Pass a single adjustment entry to rectify the error.

VIEW SOLUTION

Question 9

'Telecom Limited' is registered with an authorized capital of Rs 8,00,00,000 divided into 80,00,000 equity shares of Rs 10 each. The company issued 1,00,000 shares at a premium of Rs 2 per share. The amount was payable as follows :

      On application − Rs 3 per share
      On allotment − Rs 5 per share (including premium)
      On first and final call − The balance

All calls were made and were duly received except the first and final call on 1,000 shares held by Asha.
Present the 'Share Capital' in the Balance Sheet of the company as per Schedule VI Part I of the Companies Act, 1956.
VIEW SOLUTION

Question 10

'Panipat Blankets Limited' are the manufacturers and exporters of blankets. The company decided to distribute 1,000 blankets free of cost to five villages of Kashmir which had been damaged by the floods. It also decided to employ 100 young persons from these villages in their newly established factory at Ludhiana in Punjab. To meet the requirements of funds for its new factory, the company issued 1,00,000 equity shares of Rs 10 each and 2,000, 9% debentures of Rs 100 each to the vendors of machinery purchased for Rs 12,00,000.

Pass necessary journal entries for the above transactions in the books of the company. Also identify any one value which the company wants to communicate to the society.
VIEW SOLUTION

Question 11

Kavita, Ravita and Sunita were partners in a firm sharing profits in 2 : 1 : 2 ratio. On 31.3.2014 their Balance Sheet was as follows :

Liabilities		Amount Rs	Assets	Amount Rs
Creditors		83,000	Cash	45,000
Bills Payable		19,000	Debtors	34,000
Capitals :			Bills Receivable	15,000
Kavita	1,40,000		Furniture	2,10,000
Ravita	1,80,000		Machinery	2,00,000
Sunita	90,000	4,10,000	Sunita’s Capital	8,000
		5,12,000		5,12,000

On 31.9.2014, Sunita died. The partnership deed provided for the following to the executors of the deceased partner :

(a) Her share in the goodwill of the firm, calculated on the basis of three years' purchase of the average profits of the last four years.The profits of the last four years were Rs 1,98,000; Rs 2,24,000; Rs 2,76,000 and Rs 3,27,000 respectively.

(b) Her share in the profit of the firm till the date of her death, calculated on the basis of the average profits of the last four years.

(d) Interest on her loan @ 12% per annum.

Prepare Sunita's Capital Account to be presented to her executors.

VIEW SOLUTION

Question 12

Jain, Gupta and Singh were partners in a firm. Their fixed capitals were : Jain Rs 4,00,000 ; Gupta Rs 6,00,000 and Singh Rs 10,00,000. They were sharing profits in the ratio of their capitals. The firm was engaged in the processing and distribution of flavoured milk. They partnership deed provided for interest on capital at 10% per annum. During the year ended 31st March 2014 the firm earned a profit of Rs 1,47,000.
Showing your working notes clearly, prepare Profit and Loss Appropriation Account of the firm.
VIEW SOLUTION

Question 13

'Chennai Fibers Limited' was registered with an authorized capital of Rs 40,00,000 divided into 4,00,000 equity shares of Rs 10 each. The company had issued 1,00,000 shares and the dividend paid per share was Rs 3 for the year 2007 - 08. The management of the company decided to export its readymade apparels to European countries. To meet the requirement of additional funds, the finance manager put up before the Board of Directors the following three alternative proposals :
(i) Issue of 1,54,000 equity shares at par.
(ii) Obtain a loan of Rs 15,40,000 from a financial institution for a period of 5 years. The loan was available @ 12% per annum.
(iii) Issue 16,000, 9% debentures of Rs 100 each at a discount of 10% redeemable in instalments at the end of third, fourth, fifth and sixth year as per details given below :

Year Amount
Rs

III 2,00,000

IV 3,00,000

V 4,00,000

VI 7,00,000

After comparing the alternatives, the company decided in favour of the third alternative and issued debentures on 1.4.2008.
Prepare 9% debentures account for the years 2008 - 09 to 2013 - 14.
VIEW SOLUTION

Question 14

Chopra, Shah and Patel were partners sharing profits in the ratio of 3 : 2 : 1. On 31.3.2014 their firm was dissolved. The assets were realized and liabilities were paid off. The accountant prepared Realisation Account, Partner's Capital Accounts and Cash Account but forgot to post few amounts in these accounts.

You are required to complete the below give accounts by posting correct amounts.

Realisation Account
Dr.		Cr.
Particulars	Amount Rs.	Particulars		Amount Rs.
To Plant and Machinery	1,60,000	By Sundry Creditors		1,50,000
To Stock	1,50,000	By Mrs. Chopra’s Loan		1,30,000
To Sundry Debtors	2,00,000	By Repairs and Renewals Reserve		12,000
To Prepaid Insurance	4,000	By Provision for Bad Debts		10,000
To Investments	30,000	By Cash A/c – (Assets sold) :
To Chopra’s Capital A/c		Plant	1,00,000
(Mrs. Chopra’s Loan)	1,30,000	Stock	1,20,000
To Cash A/c (Dishonoured Bill)	50,000	Debtors	1,60,000	3,80,000
To Cash (Creditors)	1,50,000	By Chopra’s Capital A/c (Investments)		20,000
To Cash (Expenses)	8,000	…………		……….
	8,82,000			8,82,000

Partner’s Capital Accounts
Dr.				Cr.
Particulars	Chopra Rs	Shah Rs	Patel Rs	Particulars	Chopra Rs	Shah Rs	Patel Rs
To Realisation	20,000			By bal. b/d
(Investments)
…….	…….	…….	…….	By Realisation	1,30,000
				(Loan)
…….	…….	…….	…….	…….	…….	…….	…….
	2,30,000	1,50,000	30,000		2,30,000	1,50,000	30,000

Cash Account
Dr.		Cr.
Particulars	Amount Rs	Particulars	Amount Rs
…….	…….	By Realisation A/c (Dishonoured Bill)	50,000
…….	…….	By Realisation (Sundry Creditors)	1,50,000
To Patel’s Capital A/c	10,000	…….	…….
		By Chopra’s Capital A/c	1,20,000
		By Shah’s Capital A/c	90,000
	4,18,000		4,18,000

VIEW SOLUTION

Question 15

On 1.4.2013 Mohan and Sohan entered into partnership for doing business of dry fruits. Mohan introduced Rs 1,00,000 as capital and Sohan introduced Rs 50,000. Since Sohan could introduce only Rs 50,000 it was further agreed that as and when there will be a need Sohan will introduce further capital. Sohan was also allowed to withdraw from his capital when the need for the capital was less. During the year ended 31.3.2014, Sohan introduced and withdrew the following amounts of capital :

Date	Capital Introduced	Capital Withdrawn
01.5.2013	10,000	___
30.6.2013	___	5,000
30.9.2013	97,000	___
01.2.2014	___	87,000

The partnership deed provided for interest on capital @ 6% per annum. Calculate interest on capitals of the partners.

VIEW SOLUTION

Question 16

Ratan Limited invited applications for issuing 12,000 equity shares of Rs 100 each at a premium of Rs 75 per share. The amount was payable as follows :

On application and allotment – Rs 100 per share

(including Rs 50 premium)

On first and final call – The balance

Applications for 15,000 shares were received. Shares were allotted on pro-rata basis to all applicants. Excess money received with applications was adjusted towards sums due on first and final call. Govind who had applied for 300 shares paid the full share money at the time of applying for shares. Girdhar, who had applied for 600 shares, failed to pay the first and final call money. His shares were forfeited. Out of the forfeited shares, 300 shares were re-issued at Rs 90 per share as fully paid-up.

Pass necessary journal entries for the above transactions in the books of 'Ratan Limited'.

OR

'Kalyan Limited' invited applications for issuing 90,000 equity shares of Rs 10 each at a discount of 8%. The amount was payable as follows :

On application – Rs per share
On allotment – Rs 3 per share
On first and final call – The balance

Application for 87,000 shares were received. Shares were allotted to all the applicants. A shareholder, Shyam who had applied for 1,600 shares failed to pay the allotment money and his shares were immediately forfeited. Later on, the first and final call was made. Another shareholder Ram, to whom 1,500 shares were allotted failed to pay the first and final call. His shares were also forfeited. Out of the forfeited shares 2,000 shares were re-issued at Rs 9 per share as 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 'Kalyan Limited'.
VIEW SOLUTION

Question 17

A, B and C were partners in a firm sharing profits in the ratio of 3 : 2 : 1. On 1.4.2014 their Balance Sheet was as follows :

Liabilities		Amount Rs	Assets		Amount Rs
Creditors		25,200	Bank		8,200
Provident Fund		3,000	Debtors	60,000
General Reserve		21,000	Less: Provision	2,000	58,000
Capital Accounts :			Stock		50,000
A	80,000		Investments		20,000
B	73,000		Patents		10,000
C	40,000	1,93,000	Machinery		96,000
		2,42,200			2,42,200

On the above date C retired. It was agreed that :

(i) Goodwill of the firm be valued at Rs 5,400.

(ii) Depreciation of 10% was to be provided on machinery.

(iii) Patents were to be reduced by 20%.

(iv) Liability on account of Provident Fund was estimated at Rs 2,500.

(v) C took over investments for Rs 31,700.

(vi) A and B decided to adjust their capitals in proportion to their profit sharing ratio. For this purpose current accounts were opened.

Prepare Revaluation Account and Partners' Capital Accounts on C's retirement.

O, R and S were partners in a firm sharing profits in the ratio of 3 : 2 : 1. On 1.4.2014 their Balance Sheet was as follows :

Liabilities			Amount Rs	Assets	Amount Rs
Capital Accounts :				R’s Current Account	7,000
O	1,75,000			Land and Building	1,75,000
R	1,50,000			Plant and Machinery	67,500
S	1,25,000		4,50,000	Furniture	80,000
Current Accounts :				Investment	36,500
O		4,000		Bills Receivable	17,000
S		6,000	10,000	Sundry Debtors	43,500
General Reserve			15,000	Stock	1,37,000
Profit and Loss Accounts			7,000	Bank	43,500
Creditors			80,000
Bills Payable			45,000
			6,07,000		6,07,000

On the above date, H was admitted on the following terms :
(i) H will bring Rs 50,000 as his capital and will get 1/6^th share in the profits.
(ii) He will bring necessary cash for his share of goodwill premium. The goodwill of the firm was valued at Rs 90,000.
(iii) The new profits sharing ratio will be 2 : 2 : 1 : 1.
(iv) A liability of Rs 7,004 will be created against bills receivables discounted.
(v) The value of stock, furniture and investments is reduced by 20% whereas the value of land and building and plant and machinery will be appreciated by 20% and 10% respectively.
(vi) The Capital accounts of the partners will be adjusted on the basis of H's Capital through their current accounts.

Prepare Revaluation Account and Partner's Current Accounts and Capital Accounts.

VIEW SOLUTION

Question 18

Which of the following transactions will result into flow of cash :

(i) Deposited Rs 43,000 into bank.
(ii) Withdrew cash from bank Rs 23,000.
(iii) Sale of machinery of the book value of Rs 38,000 at a loss of Rs 3,000.
(iv) Converted Rs 2,00,000, 9% debentures into equity shares.
VIEW SOLUTION

Question 19
While preparing 'Cash Flow Statement', the accountant of 'Jain Limited', a financing company, showed dividend received on investments as investing activity. Was he correct in doing so? Give reason. VIEW SOLUTION

Question 20

Under which major headings and sub-heading will the following items be placed in the Balance Sheet of a company as per Schedule VI part I of the Companies Act, 1956 :

(i) Loans provided re-payable on demand.
(ii) Goodwill
(iii) Copyright
(iv) General Reserve
(v) Cheques
(vi) Loose tools
(vii) Stock of finished goods
(viii) 9% debentures re-payable after three years
VIEW SOLUTION

Question 21

The Current Ratio of a company is 2.5 : 1.5. State with reasons which of the following transactions will increase, decrease or not change the ratio :
(i) Discounted a bills receivable of Rs 10,000 from bank, Bank charged discount of Rs 200.
(ii) A bill receivable Rs 8,000 discounted with bank was dishonoured.
(iii) Cash deposited into bank Rs 7,000.
(iv) Paid cash Rs 5,000 to the creditors.
VIEW SOLUTION

Question 22

The motto of 'Nav Hind Pharma Limited', a company engaged in the manufacturing and distribution of Aurvedic medicines, is 'Healthy India'. Its management and employees are hardworking, honest and motivated. The net profit of the company doubled during the year ended 31.3.2014. Encouraged by its performance, the company decided to pay one month's extra salary to all its employees.

Following is the Comparative Statement of Profit and Loss of the company for the years ended 31.3.2013 and 31.3.2014 :

Nav Hind Pharma Limited
Comparative Statement of Profit and Loss
Particulars	Note No.	2012 − 13 Rs	2013 − 14 Rs	Absolute Change Rs	% Change
Revenue from operations		40,00,000	60,00,000	20,00,000	5.0
Less : Employees benefit expenses		24,00,000	28,00,000	4,00,000	16.67
Profit before tax		16,00,000	32,00,000	16,00,000	100
Tax @ 50%		8,00,000	16,00,000	8,00,000	100
Profit after tax		8,00,000	16,00,000	8,00,000	100

(i) Calculate New Profit Ratio for the years ending 31.3.2013 and 31.3.2014.
(ii) Identify any two value which 'Nav Hind Pharma Limited' is trying to communicate. VIEW SOLUTION

Question 23

Following is the Balance Sheets of Wind Power Ltd. as at 31.3.2014 :

**Wind Power Ltd.**
**Balance Sheet as at 31.3.2014**
Particulars	Note No.	2013–14 Rs	2012–13 Rs
I. Equity and Liabilities : 1. Shareholder's Funds :
(a) Share Capital		48,00,000	44,00,000
(b) Reserves and Surplus	1	12,00,000	8,00,000
2. Non-Current Liabilities :
Long-Term Borrowings		9,60,000	6,80,000
3. Current Liabilities :
(a) Trade Payables		7,16,000	8,16,000
(b) Short-Term Provisions		2,00,000	3,08,000
Total		78,76,000	70,04,000

II. Assets : 1. Non-Current Assets :
(a) Fixed Assets :
(i) Tangible	2	42,80,000	34,00,000
(ii) Intangible	3	1,60,000	4,80,000
2. Current Assets :
(a) Current Investments		9,60,000	4,48,000
(b) Inventories		5,16,000	4,84,000
(c) Trade Receivables		6,80,000	5,72,000
(d) Cash and Cash equivalents		12,80,000	16,20,000
Total		78,76,000	70,04,000

Notes to Accounts

S. No.	Particulars	As on 31.3.2014 Rs	As on 31.3.2013 Rs
1.	Reserves and Surplus
	Surplus (Balance in Statement of Profit and Loss)	12,00,000	8,00,000
2.	Tangible Assets
	Machinery	50,80,000	40,00,000
	Less : Accumulated Depreciation	(8,00,000)	(6,00,000)
3.	Intangible Assets
	Goodwill	1,60,000	4,80,000

Additional Information :

During the year a piece of machinery, costing Rs 96,000 on which accumulated depreciation was Rs 64,000 was sold for Rs 24,000.

Prepare Cash Flow Statement.

VIEW SOLUTION

More Board Paper Solutions for Class 12 Commerce Accountancy

Board Paper Solutions for Other Subjects

Year	Amount Rs
III	2,00,000
IV	3,00,000
V	4,00,000
VI	7,00,000