Board Paper of Class 12-Commerce 2010 Accountancy Delhi(SET 1) - Solutions

State the basis of accounting on which a Receipts and Payments account is prepared in case of a not for profit organisation.

What is meant by “Unlimited liability of a Partner”?

State the need for treatment of Goodwill on admission of a Partner.

What are Preliminary Expenses?

How does the factor “location” affect the goodwill of a firm?

From the following information, calculate the amount of subscription outstanding for the year 2008-09.

A Club has 250 members each paying an annual subscription of Rs 1,000. The Receipts and Payments account for the year showed a sum of Rs 2,65,000 received as subscription. The following additional information is provided.

S.S.S. Ltd., has a paid up share capital of Rs 60,00,000 and a balance of Rs 15,00,000 in the securities premium account. The company management do not want to carry over this balance. State the purpose for which this balance can be utilised.

DN Ltd. issued 50,000 shares of Rs 10 each at a discount of 10% payable as Rs 2 per share on application, Rs 3 on allotment and Rs 2 each on first and final call. Applications were received for 70,000 shares. It was decided that (a) refuse allotment of the applicants for 10,000 shares (b) allot 20,000 shares to Mohan who had applied for similar number and (c) allot the remaining shares on pro-rata basis. Mohan failed to pay to allotment money and Sohan who belonged to category ‘C’, and was allotted 3,000 shares paid both the calls with allotment. Calculate the amount received on allotment.

A, B and C were partners. Their capitals were Rs 30,000; Rs 20,000 and Rs 10,000 respectively. According to the partnership deed they were entitled to an interest on capital at 5% p.a. In addition B was also entitled to draw a salary of Rs 500 per month. C was entitled to a commission of 5% on the profits after charging the interest on capital, but before charging the salary payable to B. The net profits for the year were Rs 30,000, distributed in the ratio of their capitals without providing for any of the above adjustment. The profits were to be shared in the ratio of 2 : 2 : 1.

Pass the necessary adjustment entry showing the workings clearly.

A, B and C were partners sharing profits in the ratio of 6 : 4 : 5. Their capitals were A- Rs 1,00,000, B- Rs 80,000 and C- Rs 60,000.

On 1^st April 2009, B retired from the firm and the new profit sharing ratio between A and C was decided as 11 : 4. On B’s retirement the goodwill of the firm was valued at Rs 1,80,000. Showing your calculation clearly pass necessary journal entry for the treatment of goodwill on B’s retirement.

X Ltd., had Rs 8,00,000, 9% debentures due to be redeemed out of profits on 1^st Oct., 2009 at a premium of 5%. The company had a

Debenture Redemption Reserve of Rs 4,14,000. Pass necessary journal entries at the time of redemption.

From the following information of a not for profit organization, show the ‘sports material’ items in the ‘Income and Expenditure

Account’ for the year ending 31^st March, 2009 and the Balance Sheets as on 31^st March 2008 and 31^st March, 2009.

Payment to supplies for the sports material during the year was Rs 1,20,000, there were no cash purchase made.

(a) X, Y and Z are partners in a firm sharing profits in the ratio of 3 : 2 : 1. On April 1^st 2009, X retires from the firm, Y and Z agree that the capital of the new firm shall be fixed at Rs 2,10,000 in the profit sharing ratio. The Capital Accounts of Y and Z after all adjustment on the date of retirement showed balances of Rs 1,45,000 and Rs 63,000 respectively. State the amount of actual cash to be brought in or to be paid to the partners.

(b) A, B and C are partners in a firm whose books are closed on March 31^st each year. A died on 30^th June 2009 and according to the agreement the share of profits of a deceased partner up to the date of the death is to be calculated on the basis of the average profits for the last five year. The net profit of the last 5 years have been: 2005 − Rs 14,000; 2006 − Rs 18,000; 2007 − Rs 16,000, 2008 − Rs 10,000 (loss) and 2009 − Rs 16,000. Calculate A’s share of the profits upto the date of death and pass necessary journal entry.

Suresh Ltd., on 1^st April 2006 acquired assets of the value of Rs 6,00,000 and liabilities worth Rs 70,000 from P & Co., at an agreed value of Rs 5,50,000. Suresh Ltd. issued 12% Debentures of Rs 100 each at a premium of 10% in full satisfaction of purchase consideration. The Debentures were redeemable 3 years later at a premium of 5%. Pass entries to record the above including redemption of debentures.

X Ltd. issued 50,000 shares of Rs 10 each at a premium of Rs 2 per share payable as follows:

Rs 3 on application

Rs 6 on allotment (including premium) and Rs 3 on call

Applications were received for 75,000 shares and a pro-rata allotment was made as follows:

To the applicants of 40,000 shares, 30,000 shares were issued and for the rest 20,000 shares were issued. All money due were received except the allotment and call money from Ram who had applied for 1,200 shares (out of the group of 40,000 shares). All his shares were forfeited. The forfeited shares were re-issued for Rs 7 per share fully paid up. Pass necessary Journal Entries for the above transaction.

OR

Janta Ltd., invited application for issuing 2,00,000 equity share of Rs 10 each at a discount of 10%. The amount was payable as follows:

On Application Rs 2 per share

On Allotment Rs 3 per share

On First and final call-balance amount

The issue was undersubscribed to the extent of 20,000 shares. Shares were allotted to all the application. All calls were made and were dully received. ‘A’ to whom 1,500 shares were allotted failed to pay allotment and call money and ‘B’ to whom 1,200 share were allotted paid the full amount due at the time of allotment. The share on which allotment and call money was not received were forfeited. The forfeited shares were re-issued at Rs 8 per share fully paid up.

Pass necessary journal entries in the books of Janta Ltd., for the above transaction.

A, B and C were partners sharing profits in the ratio of 3 : 1 : 1. Their Balance-Sheet as on March 31^st 2009, the date on which they dissolve their firm, was as follows:

It was agreed that:

(a) A to take over Bills Receivable at Rs 800, debtors amounting to Rs 20,000 at 17,200 and the creditors of Rs 6,000 were to be paid by him at this figure.

(b) B is to take over all stock for Rs 7,000 and some sundry assets at Rs 7,200 (being 10% less than the book value)

(c) C to take over remaining sundry assets at 90% of the book value and assume the responsibility of discharge of loan together with accrued interest of Rs 300.

(d) The expenses of realization were Rs 270

The remaining debtors were sold to a debt collecting agency at 50% of the book value. Prepare Realisation A/c, Partners Capital A/c and Cash A/c

OR

On 31^st March, 2009 the Balance Sheet of Ram and Shyam, who were sharing profits in the ratio of 3 : 1 was as follows:

They decided to admit, Mohan on April 1^st 2008 for 1/5^th share on the following terms:

(i) Mohan shall bring Rs 6,000 as his share of premium.

(ii) That unaccounted accrued income of Rs 100 be provided for.

(iii) The market value of investment was Rs 4,500.

(iv) A debtor whose dues of Rs 500 was written off as bad debts paid Rs 400 in full settlement.

(v) Mohan to brings in capital to the extent of 1/5^th of the total capital of the new firm.

Prepare Revaluation A/c, Partners Capital A/c and the Balance Sheet of the new firm.