Accountancy Delhi Set 1 2015-2016 Science (English Medium) Class 12 Question Paper Solution

Accountancy [Delhi Set 1]
Date & Time: 17th March 2016, 10:30 am
Duration: 3h

[1] 1

Name the Act that provides for the maximum number of partners in a partnership firm. What is the maximum number of partners that a partnership firm can have?

Concept: Accounting for Partnership Firms - Reconstitution and Dissolution
Chapter: [0.031] Accounting for Partnership Firms
[1] 2

A, B and C were partners in a firm sharing profits in the ratio of 3:2:1. They admitted D as a new partner for 1/8th share in the profits, which he acquired 1/16th from B and 1/16th from C.

Calculate the new profit sharing ratio of A, B, C and D.

Concept: Admission of a Partner - Sacrifice Ratio and New Ratio
Chapter: [0.031] Accounting for Partnership Firms
[1] 3

Distinguish between 'Dissolution of Partnership' and 'Dissolution of Partnership Firm on the basis of 'Economic Relationship'.

Concept: Dissolution of Partnership Firm
Chapter: [0.015] Dissolution of Partnership Firm [0.015] Dissolution of Partnership Firm [0.031] Accounting for Partnership Firms
[1] 4

State the provisions of the Companies Act, 2013 for the creation of 'Debenture Redemption Reserve'.

Concept: Creation of Debenture Redemption Reserve
Chapter: [0.032] Accounting for Companies
[1] 5

On 1-1-2016 the first call of Rs.3 per share became due on 1,00,000 equity shares issued by Kamini Ltd. Karan a holder of 500 shares did not pay the first call money. Arjun a shareholder holding 1000 shares paid the second and final call of Rs.5 per share along with the first call. Pass the necessary journal entry for the amount received by opening 'Calls-in-arrears' and 'Calls-in-advance' account in the books of the company

Concept: Calls in Advance and Arrears
Chapter: [0.032] Accounting for Companies
[1] 6

Nusrat and Sonu were partners in a firm sharing profits in the ratio of 3:2. During the year ended 31-3-2015 Nusrat had withdrawn Rs.15,000. Interest on her drawings amounted to Rs.300. Pass necessary journal entry for charging interest on drawing assuming that the capitals of the partners were fixed.

Concept: Methods of Capital Accounts - Fixed and Fluctuating Capital Method
Chapter: [0.031] Accounting for Partnership Firms
[3] 7

KTR Ltd., issued 365, 9% Debentures of 1,000 each on 4-3-2016. Pass necessary journal entries for the issue of debentures in the following situations:

(a) When debentures were issued at par redeemable at a premium of 10%.

(b) When debentures were issued at 6% discount redeemable at 5% premium.

Concept: Issue of Debentures with Terms of Redemption
Chapter: [0.022000000000000002] Issue and Redemption of Debentures [0.032] Accounting for Companies
[3] 8

State any three circumstances other than (i) admission of a new partner; (ii) retirement of a partner and (iii) death of a partner, when need for valuation of goodwill of a firm may arise.

Concept: Concept of Goodwill
Chapter: [0.013000000000000001] Reconstitution of a Partnership Firm – Admission of a Partner [0.013999999999999999] Reconstitution of a Partnership Firm – Retirement/Death of a Partner [0.031] Accounting for Partnership Firms
[3] 9

Sandesh Ltd. took over the assets of Rs.7,00,000 and liabilities of Rs.2,00,000 from Sanchar Ltd. for a purchase consideration of Rs.4,59,500. Rs.8,500 were paid by accepting a draft in favour of Sanchar Ltd. payable after three months and the balance was paid by issue of equity shares of 10 each at a premium of 10% in favour of Sanchar Ltd.

Pass necessary journal entries for the above transactions in the books of Sandesh Ltd.

Concept: Issue at Par and Premium and at Discount
Chapter: [0.032] Accounting for Companies
[3] 10

To provide employment to the youth and to develop the Naxal affected backward areas of Chhattisgarh. X Ltd. decided to set-up a power plant. For raising funds the company decided to issue 7, 50,000 equity shares of Rs.10 each at a premium of 50%. The whole amount was payable on application. Applications for 20,00,000 shares were received. Applications for 50,000 shares were rejected and shares were allotted to the remaining applicants on pro-rata basis.

Pass necessary journal entries for the above transactions in the books of the company and identify any two values which X Ltd. wants to propagate.

Concept: Pro-rata Allotment
Chapter: [0.032] Accounting for Companies
[4] 11

P and Q were partners in a firm sharing profits in the ratio of 5:3. On 1-4-2014 they admitted R as a new partner for 1/8th share in the profits with a guaranteed profit of Rs. 75,000. The new profit sharing ratio between P and Q will remain the same but they agreed to bear any deficiency on account of guarantee to R in the ratio 3:2. The profit of the firm for the year ended 31-3-2015 was Rs. 4,00,000.

Prepare Profit and Loss Appropriation Account of P, Q and R for the year ended 31-3-2015.

Concept: Preparation of Profit and Loss Appropriation Account
Chapter: [0.031] Accounting for Partnership Firms
[4] 12

Vikas, Vishal and Vaibhav were partners in a firm sharing profits in the ratio of 2:2:1. The firm closes its books 31st March every year. On 31-12-2015 Vaibhav died. On that date his Capital account showed a credit balance of Rs. 3, 80,000 and Goodwill of the firm was valued at 1, 20,000. There was a debit balance of Rs. 50,000 in the profit and loss account. Vaibhav's share of profit in the year of his death was to be calculated on the basis of the average profit of last five years. The average profit of last five years was Rs. 75,000.

Pass necessary journal entries in the books of the firm on Vaibhav's death.

Concept: Concept of Goodwill
Chapter: [0.013000000000000001] Reconstitution of a Partnership Firm – Admission of a Partner [0.013999999999999999] Reconstitution of a Partnership Firm – Retirement/Death of a Partner [0.031] Accounting for Partnership Firms
[6] 13

L and M were partners in a firm sharing profits in the ratio of 2:3. On 28-2-2016 the firm was dissolved. After transferring assets (other than cash) and outsiders' liabilities to realization account you are given the following information :

(a) A creditor for Rs.1,40,000 accepted building valued at Rs.1, 80,000 and paid to the firm Rs.40,000.

(b) A second creditor for Rs.30,000 accepted machinery valued at Rs.28,000 in full settlement of his claim.

(c) A third creditor amounting to Rs.70,000 accepted Rs.30,000 in cash and investments of the book value of Rs.45,000 in full settlement of his claim.

(d) Loss on dissolution was Rs.4,000.

Pass necessary journal entries for the above transactions in the books of the firm assuming that all payments were made by cheque.

Concept: Dissolution of Partnership Firm
Chapter: [0.015] Dissolution of Partnership Firm [0.015] Dissolution of Partnership Firm [0.031] Accounting for Partnership Firms
[6] 14

Ashok, Bhim and Chetan were partners in a firm sharing profits in the ratio of 3:2:1.

Their Balance Sheet as on 31-3-2015 was as follows:

Balance Sheet of Ashok, Bhim and Chetan

as on 31-3-2015

 Liabilities Amount(Rs.) Assets Amount(Rs.) Creditors Bills Payable General Reserve Capitals         Ashok                2,00,000         Bhim                  1,00,000         Chetan                  50,000 1,00,000 40,000 60,000       3,50,000 Land Building Plant Stock Debtors Bank 1,00,000 1,00,000 2,00,000 80,000 60,000 10,000 5,50,000 5,50,000

Ashok, Bhim and Chetan decided to share the future profits equally, w.e.f. April 1, 2015. For this it was agreed that:

(i) Goodwill of the firm be valued at 3,00,000

(ii) Land be revalued at 1, 60,000 and building be depreciated by 6%.

(iii) Creditors of 12,000 were not likely to be claimed and hence be written off

Prepare Revaluation Account Partners’ Capital Accounts and Balance Sheet of the reconstituted firm

Concept: Preparation of Revaluation Account and Balance Sheet
Chapter: [0.031] Accounting for Partnership Firms
[6] 15

On 1-4-2013 JN Ltd had 10,000, 9% Debentures of 100 each outstanding.

(i) On 1-4-2014 the company purchased in the open market 2000 of its own debentures for 101 each and cancelled the same immediately.

(ii) On 1-4-2015 the company redeemed at par debentures of 4, 00,000 by draw of a lot.

(iii) On 28-2-2016 the remaining debentures were purchased for immediate cancellation for 3, 97,000.

Pass necessary journal entries for the above transactions in the books of the company ignoring debentures redemption reserve and interest on debentures

Concept: Redemption of Debentures for Immediate Cancellation - Draw of Lots, Lump Sum and Purchase in the Open Market
Chapter: [0.032] Accounting for Companies
[8] 16 | Attempt any ONE
[8] 16.1

KS Ltd invited application for issuing 1, 60,000 equity shares of Rs.10 each at a premium of 6 per share. The amount was payable as follows;

On Application Rs.4 per share (including premium Rs.1 per share)

On Allotment Rs.6 per share (including premium Rs.3 per share)

On First and Final Call – Balance

Application for 3, 20,000 shares were received. Applications for 80,000 share were rejected and application money refunded. Shares were allotted on pro-rata basis to the remaining applicants. Excess money received with application was adjusted towards surns due on allotment. Jain holding 800 shares failed to pay the allotment money his shares were forfeited immediately after allotment. Afterwards the final call was made. Gupta who has applied for 1200 shares failed to pay the final call. These shares were forfeited. Out of the forfeited shares 1000 shares were re-issued at 8 per share fully paid up. The re-issued shares included all the forfeited shares of Jain

Pass necessary journal entries for the above transactions in the books of KS Ltd.

Concept: Accounting Treatment of Forfeiture and Re-issue of Share
Chapter: [0.021] Accounting for Share Capital [0.032] Accounting for Companies
[8] 16.2

GG Ltd has issued 50,000 equity shares of 10 each at a premium of 2 per share payable with application money. The incomplete journal entries related to the issue are given below. You are required to complete these blanks.

Books of GG Ltd

Journal

 Date Particulars L.F. Dr.(Rs.) Cr.(Rs.) 2015 Jan 10 _ _ _ _ _ _ _ _ _ _ _                                                                                                                 Dr              To _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ (Amount received on application for 70,000 shares @ 5 per share including premium) Jan 16 Equity Share Application A/c                                                                                                     Dr                   To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _                   To _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _                   To _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _                   To _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ (Transfer of application money to share capital securities premium, money refunded for 8,000) shares for rejected application and balance adjusted towards amount due on allotment as shares were allotted on Pro-rata basis) Jan 31 _ _ _ _ _ _ _ _ _ _                                                                                                                     Dr                  To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ (Amount due on allotment @ Rs.4 per share) Feb 20 _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _                                                                                              Dr                    To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ (Balance amount received on allotment) April 01 _ _ _ _ _ _ _ _ _                                                                                                                        Dr                  To _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ (First and Final Call money due) April 20 _ _ _ _ _ _ _ _ _ _                                                                                                                     Dr Calls – in – arrears A/c                                                                                                               Dr               To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ (Money received on First and Final Call) 1,500 Aug 27 _ _ _ _ _ _ _ _ _                                                                                                                        Dr                To _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _                To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ (Forfeited the shares on which call money was not received) Oct 3 _ _ _ _ _ _ _ _ _ _                                                                                                                     Dr _ _ _ _ _ _ _ _ _ _                                                                                                                     Dr                To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ (Re-issued the forfeited shares @ 8 per share fully paid - up) _ _ _ _ _ _ _ _ _ _ _ _ _ __                                                                                                                      Dr               To _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ (_ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ __ _ _ _ _ _ _ _ _ _ _ _ _ __ )
Concept: Issue at Par and Premium and at Discount
Chapter: [0.032] Accounting for Companies
[8] 17 | Attempt any ONE
[8] 17.1

A, B and C were partners in a firm sharing profit in the ratio of 3:2:1. On 31-3-2015 their Balance sheet was as follows :

Balance Sheet of A,B and C as on 31-3-2015

 Liabilities Amount(Rs.) Assets Amount(Rs.) Creditors General Reserve   Capitals     A                       60,000     B                       40,000     C                       20,000 84,000 21,000         1,20,000 Bank Debtors Stock Investments Furniture & Fittings Machinery 17,000 23,000 1,10,000 30,000 10,000 35,000 2,25,000 2,25,000

On the above date D was admitted as new partner and it was decided that

(i) The new profit sharing ratio between A, B, C and D will be 2:1:1:1.

(ii) Goodwill of the firm was valued at Rs.90,000 and D brought his share of goodwill premium in cash.

(iii) The Market value of investments was Rs.24,000

(iv) Machinery will be reduced to Rs.29,000

(v) A Creditor of Rs.3,000was not likely to claim the amount and hence to be written off.

(vi) D will bring proportionate capital so as to give him 1/6th share in the profits of the firm.

Prepare Revaluations Account, Partner’s Capital Accounts and Balance Sheet of the reconstitute firm

Concept: Preparation of Revaluation Account and Balance Sheet
Chapter: [0.031] Accounting for Partnership Firms
[8] 17.2

X, Y and Z were partners in a firm sharing profit’s in the firm of 5:3:2. On 31-3-2015 their Balance Sheet was as follows:

Balance sheet of X,Y and Z as on 31st march,2015

 Liabilities Amount(Rs.) Assets Amount(Rs.) Creditors Investment Fluctuation Fund P & L Account Capital:        X                            50,000        Y                             40,000        Z                            20,000 21,000 10,000 40,000       1,10,000 Land and Building Motor Vans Investments Machinery Stock Debtors                         40,000       Less:                         3,000 Cash 62,000 20,000 19,000 12,000 15,000   37,000 16,000 1,81,000 1,81,000

On the above date Y retired and X and Z agreed to continue the business on the following terms:

(1) Goodwill of the firm was valued at Rs.51,000

(2) There was a claim of 4,000 for Workmen’s Compensation.

(3) Provision for bad debts was to be reduced by 1,000

(4) Y will be paid 8,200 in cash and the balance will be transferred in his loan account which will be paid in four equally yearly instalments together with interest @ 10% p.a.

(5) The new profit sharing ratio between X and Z will be 3:2 and their capitals will be in their new profit sharing ratio. The Capital adjustments will be done by opening current Accounts

Prepare Revaluation Account. Partner’s Capital Accounts and the Balance Sheet of reconstituted firm.

Concept: Preparation of Revaluation Account and Balance Sheet
Chapter: [0.031] Accounting for Partnership Firms
[1] 18

'An enterprise may hold securities and loans for dealing or trading purposes in which case they are similar to inventory acquired specifically for resale.' Is the statement true? Cash flows from such activities will be classified under which type of activity while preparing 'Cash flow statement'.

Concept: Concept of Cash Flow Statement
Chapter: [0.026000000000000002] Cash Flow Statement
[1] 19

Give the meaning of ‘Cash Equivalents’ for the purpose of preparing Cash Flow Statement.

Concept: Concept of Cash Flow Statement
Chapter: [0.026000000000000002] Cash Flow Statement
[4] 20
[2] 20.1

One of the objectives of ‘Financial Statements Analysis’ is to identify the reasons for change in the financial position of the enterprise, State two more objectives of this analysis.

Concept: Concept of Financial Statement Analysis
Chapter: [0.040999999999999995] Analysis of Financial Statements
[2] 20.2

Name any two items that are shown under the head’ Other Current Liabilities’ and any two items that are shown under the head ‘Other Current Assets’ in the Balance Sheet of a company as per schedule III of the Companies Act, 2013.

Concept: Accounting for Revaluation of Assets and Reassessment of Liabilities
Chapter: [0.013000000000000001] Reconstitution of a Partnership Firm – Admission of a Partner [0.031] Accounting for Partnership Firms
[4] 21
[2] 21.1

What is meant by solvency of business.

Concept: Solvency Ratios - Debt to Equity Ratio
Chapter: [0.040999999999999995] Analysis of Financial Statements
[2] 21.2

From the following details obtained from the financial statements of Jeev Ltd. Calculate interest coverage ratio

Net Profit after tax 1, 20,000

12% Long term Debt 20, 00,000

Tax Rate 40%

Concept: Solvency Ratios - Interest Coverage Ratio
Chapter: [0.040999999999999995] Analysis of Financial Statements
[4] 22

Following is the statement of Profit and Loss of Sun India Ltd. For the year ended 31st March. 2015:

 Particulars Note No. 31-3-2015 (Rs.) 31-3-2014 (Rs.) Revenue from operations Other Income Employee benefit – expenses Other expenses Tax Rate 25,00,000 1,00,000 60% of total revenue 10% of employee benefit expenses 50% 20,00,000 5,00,000 50% of total revenue 20% of employee benefit expenses 40%

The motto of Sun India Ltd is to produce and supply green energy in the rural areas of India. It has also taken up a project of constructing a road that will pass through five villages, so that these villages could be connected to the nearby town. It will use the local resources and employ local people for construction of the road.

You are required to prepare a Comparative Statement of Profit and Loss of Sun India Ltd from the given statement of Profit and Loss. Also identify any two values that the company wishes to convey to the society.

Concept: Comparative Statements
Chapter: [0.024] Analysis of Financial Statements [0.040999999999999995] Analysis of Financial Statements
[6] 23

Following is the Balance Sheet of K K Ltd as at 31-3-2015:

K.K. Ltd Balance Sheet as at 31-3-2015

 Particulars Note No. 31-3-2015 (Rs.) 31-3-2014 (Rs.) I. Equity and Liabilities         1. Shareholder’s Funds               a. Share Capital               b. Reserve and Surplus          2. Non - Current Liabilities               a) Long – term borrowings          3. Current Liabilities               a) Short – term borrowings               b)Short – term provisions 1   2   3 4 10,00,000 4,00,000   9,00,000   3,00,000 1,40,000 8,00,000 (1,00,000)   10,00,000   1,00,000 1,80,000 Total 27,40,000 19,80,000 II. Assets      1. Non – Current Assets                a) Fixed Assets                      Tangible assets                      Intangible assets                b) Non – Current Investments       2. Current Assets                 a) Current Investments                 b) Inventories                 c) Cash and Cash 5 6       7 20,06,000 40,000 2,00,000   1,00,000 2,14,000 1,80,000 14,40,000 60,000 1,50,000   1,20,000 90,000 1,20,000 Total 27,40,000 19,80,000

 Note No Particulars 31-3-2015(Rs.) 31-3-2014(Rs.) 1. Reserve and Surplus (Surplus i.e. Balance in Statement of Profit and Loss) 4,00,000 (1,00,000) 4,00,000 (1,00,000) 2. Long term borrowings : 12 % Debentures 9,00,000 10,00,000 9,00,000 10,00,000 3. Short – term borrowings : Bank Overdraft 3,00,000 1,00,000 3,00,000 1,00,000 4. Short – term provisions Provisions for tax 1,40,000 1,80,000 1,40,000 1,80,000 5. Tangible Assets Machinery Accumulated Depreciation 24,06,000 (4,00,000) 16,42,000 (2,02,000) 20,06,000 14,40,000 6. Intangible Assets Goodwill 40,000 60,000 40,000 60,000 7. Inventories Stock in trade 2,14,000 90,000 2,14,000 90,000

(i) 12% Debentures were redeemed on 31-3-2015

(ii) Tax 1,40,000 was paid during the year

Prepare Cash flow Statement.

Concept: Concept of Cash Flow Statement
Chapter: [0.026000000000000002] Cash Flow Statement

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