LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034
B.C.A. DEGREE EXAMINATION – COMPUTER APPLICATIONS
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THIRD SEMESTER – November 2008
CO 3104/CO 3102 – ACCOUNTS & BUSINESS APPLICATIONS
Date : 11-11-08 Dept. No. Max. : 100 Marks
Time : 9:00 – 12:00
PART –A
ANSWER ALL QUESTIONS (10x 2 =20)
- Define Accounting.
- State the rules for debit and credit under double entry system.
- What is meant by error of principle?
- Write a note on going concern concept?
- Bring out any four differences between cash discount and trade discount.
- John bought a machine for Rs.750000 and spent Rs.25000 towards its installation. The useful life of the machine is 7 years and the estimated scrap value is Rs.100000. Calculate the rate of depreciation under Straight Line method.
- Rectify the following errors:
(a) Rs.10000 received from Sam & Co. has been wrongly entered as from Shyam&Co
(b) An amount of Rs.1000 withdrawn by the proprietor for his own use has been debited to office expenses account.
- Pass necessary adjusting entries for the following transactions:
- Wages due Rs.1000 (b) Rent received in advance Rs.20000
- Balance Sheet of M/s.Peacock Ltd. as on 31.03.2008
| Liabilities | Rs. | Assets | Rs. |
| Share Capital | 300000 | Land | 825000 |
| Reserves & Surplus | 225000 | Cash | 375000 |
| Bank Overdraft | 350000 | Stock | 175000 |
| Creditors | 600000 | Goodwill | 100000 |
| 1475000 | 1475000 |
Calculate Proprietary ratio
- Prepare Bank Reconciliation Statement: (Rs.)
Balance as per Pass Book 9000 Cheques issued but not presented 15000
Cheques deposited but not credited 1500 Bank has given credit for interest 150
PART –B
ANSWER ANY FIVE QUESTIONS (5 x 8= 40)
- Write short notes on: (a)Current assets (b) Bank Reconciliation Statement (c)Common Size statements (d)Trial Balance
- Briefly explain the objectives of accounting.
- What is cash flow statement? What are its utilities?
- Journalise the following transactions:
- Started business with cash Rs.100000, Furniture Rs.200000, Machinery Rs.300000 and Bank Loan Rs.50000
- Purchased goods for cash Rs.25000, of which 50% of the payment made by cheque.
- Sold goods to Rashid Rs.50000
- Final settlement received from Rashid Rs.49500
- Paid advertising charges Rs.5000
- Cash withdrawn from bank for office use Rs.20000 and for personal use of the proprietor Rs.15000
- Paid Salaries Rs.20000 and wages Rs.5000
- Received rent by cheque and deposited at once Rs.4000
- On 1.1.2000 M/s. Welcome Ltd. bought a second-hand machine for Rs.50000 and spent Rs.10000 for repairs. On 1.7.2001, the company bought a new machine costing Rs.100000. On 30.6.2002, the machine bought on 1.1.2000 was sold for Rs.40000. The company writes off depreciation at 12% p.a. on original cost method and closes its accounts on 31st December every year. Show Machinery account and depreciation account for 3 years ending 31-12-2002.
| Date | Particulars | Rs. |
| 2008, Jan 1 | Cash in hand | 40000 |
| 2 | Paid Cash into bank | 8000 |
| 7 | Purchased goods from Gopal | 1000 |
| 10 | Paid Rent | 1500 |
| 12 | Purchased furniture by cheque | 2000 |
| 15 | Sold goods to Daniel | 10000 |
| 16 | Final Settlement made to Gopal | 975 |
| 18 | Final Settlement received from Daniel | 9975 |
| 20 | Withdrew from bank | 4000 |
| 25 | Paid wages | 500 |
| 30 | Received from Basheer | 7500 |
| 31 | Withdrew for own use by cheque | 1000 |
- Prepare a three column cash book of a merchant to record the following transactions:
- The following are the Balance Sheets of East Ltd. & West Ltd. As on 31-3-2008. You are required to prepare Common Size Balance Sheets.
| Liabilities | EAST(Rs) | WEST(Rs.) | Assets | EAST (Rs) | WEST(Rs.) |
| Share Capital | 50000 | 120000 | Land & buildings | 100000 | 200000 |
| Reserves | 20000 | 180000 | Plant & Machinery | 20000 | 40000 |
| 15% Debentures | 80000 | — | Stock | 40000 | 60000 |
| Bank Loan | 120000 | 30000 | Debtors | 100000 | 45000 |
| Creditors | 40000 | 60000 | Bills Receivable | 20000 | 30000 |
| Bills Payable | 10000 | 30000 | Cash | 40000 | 45000 |
| 320000 | 420000 | 320000 | 420000 |
- From the following Balance Sheets of Ankit Ltd., prepare a Cash Flow Statement:
| Liabilities | 2006 (Rs) | 2007(Rs.) | Assets | 2006 (Rs) | 2007(Rs.) |
| Share Capital | 400000 | 500000 | Land | 100000 | 132000 |
| Profit & Loss A/c. | 20000 | 46000 | Cash | 60000 | 94000 |
| Creditors | 140000 | 90000 | Stock | 160000 | 180000 |
| Debtors | 240000 | 230000 | |||
| 560000 | 636000 | 560000 | 636000 |
PART –C
ANSWER ANY TWO QUESTIONS (2 x 20=40)
- From the following particulars prepare a trading and profit& loss account for the year ended 31-3-2008 and a Balance Sheet as on that date.
| Debit balance | Rs. | Credit balance | Rs. |
| Bank | 20500 | Capital | 80000 |
| Drawings | 6000 | Creditors | 10000 |
| Machinery | 25000 | Sales | 120000 |
| Stock (1.4.2007) | 15000 | Purchase Returns | 1000 |
| Purchases | 82000 | Provision for bad & Doubtful debts | 400 |
| Sales returns | 2000 | Discount received | 800 |
| Debtors | 20600 | Interest received | 1200 |
| Furniture | 5000 | ||
| Direct expenses | 2000 | ||
| Carriage outwards | 500 | ||
| Rent | 4600 | ||
| Bad debts | 800 | ||
| Trade expenses | 400 | ||
| Postage | 800 | ||
| Insurance | 700 | ||
| Salaries | 21300 | ||
| Cash | 6200 | ||
| 213400 | 213400 |
Adjustments:
(a)Stock as on 31-3-2008 – Rs.50000 (b)Salaries due Rs.2700 (c)Prepaid Insurance Rs.200 (d) Depreciate Machinery @10% p.a. (e) Write off further bad debts Rs.600 and provide for bad and doubts debts @5% on debtors.
- Enter the following transactions in the subsidiary books of M/s. Blue Star Electricals.
| Sep1. Purchased from M/s.Robin Electricals | Sep. 4 Sold to M/s.Mukesh Apartments |
| 20 Dozen -100 W Electric Bulbs @ Rs.20 each | 5 Dozen – 100 W Electric bulbs @ Rs.30 each |
| 4 Gross -40 W Tube-lights @ Rs.600 per dozen | 3 No. – Mercury Bulbs @ Rs.300 each |
| 10 No. -Mercury Bulbs @ Rs.250 each | 10 Dozen – 40 W Tube-lights @ Rs. 80 each |
| 10% Trade discount on all items | 5% Trade discount on all items |
| Sep 10. Sold to Karun Stores | Sep .15 Bought from M/s. Wind Electricals |
| 10 No. – 100 W Electric bulbs @ Rs.25 each | 4 dozen – Ceiling fans @ Rs.750 each |
| 2 Dozen – 40 W Tube-lights@ Rs.60 each | 20 No. – Table fans @ Rs.1000 each |
| 10% Trade discount on all items | 5% Trade discount on all items |
| Sep. 20 Purchase returns to M/s. Robin Electricals | Sep. 30 Sales Returns from M/s.Mukesh Apartments |
| 10 No. – 100 W Electric bulbs vide Debit note no.5 | 10 No -100 W bulbs vide Credit note no.3 |
| 10 No. – 40 W Tube-lights vide Debit note no.6 | 4 No.- 40 W Tube-lights vide Credit note no.4 |
- The following details related to Michael Traders for the year ended 31-3-2008
| Particulars | Rs. | Particulars | Rs. |
| To Opening Stock | 75000 | By Sales 520000 | |
| To Purchases | 325000 | Less: Sales Returns 20000 | 500000 |
| To Gross Profit | 200000 | By Closing Stock | 100000 |
| 600000 | 600000 | ||
| To operating expenses | By Gross Profit | 200000 | |
| Administration exp. 40000 | By non-operating income: | ||
| Selling Expenses 25000 | 65000 | Dividend 9000 | |
| To Non-operating expenses | Profit on sale of shares 11000 | 20000 | |
| Loss on sale of assets | 5000 | ||
| To Net Profit | 150000 | ||
| 220000 | 220000 |
Trading & Profit & Loss account
Balance sheet of Michael Traders as on 31-3-2008
| Liabilities | Rs. | Assets | Rs. |
| Share Capital | 200000 | Land & buildings | 150000 |
| Reserves | 100000 | Plant & Machinery | 80000 |
| Creditors | 150000 | Stock | 100000 |
| Bills Payable | 90000 | Debtors | 80000 |
| Cash | 90000 | ||
| 500000 | 500000 |
Calculate:
- Gross Profit Ratio (b) Net Profit ratio (c) Operating Profit ratio
(d) Operating Ratio (e) Stock Turn over ratio (f ) Current Ratio
(g) Debtors turn over ratio (h) Creditors turn over ratio
(i) Fixed Asset turn over ratio (j) Fixed Asset ratio