LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

       B.Sc.,B.A. DEGREE EXAMINATION – MATHEMATICS & ECONOMICS

FOURTH SEMESTER – APRIL 2008

CO 4205 / 4201 – FIN. ACCOUNTS & FIN. STAT. ANALYSIS

Date : 24/04/2008                Dept. No.                                        Max. : 100 Marks

Time : 9:00 – 12:00

SECTION A

Answer all questions:                                                              10 x 2 =20 marks

1. What is Overdraft?
2. How does one treat recovery of bad debts in accounts?
3. Differentiate between Cash discount and Trade discount?
4. a. Only __________transactions are recorded in the Single Column Cash Book

1. A ___________is a short explanation of the transaction.

1. What is a voucher?
2. Who are non- profit seeking concerns?  Give examples
3. List any two advantages of Subsidary books?
4. Why is a Trial balanace prepared?
5. Ascertain  purchases from the following figures:

Cost of goods sold                  Rs. 80,700

Opening Stock                        Rs.   5,800

Closing stock                          Rs.   6,000

1. Calculate the Capital fund by preparing Balance sheet:

Rs.                                                    Rs

Cash                                       6,000               Bank balance               35,000

Subscription outstanding        2,000               Furniture                     20,000

Building                             1,00,000               Salaries outstanding      4,000

SECTION B

Answer any  five questions:                                                    5 x 8 = 40 marks

11. What are Assets? Discuss the various types of assets?
12. Write a brief note on the importance of ratio analysis.
13. Briefly explain the concepts which form the backbone of Accounting.

1. Moon Ltd had a balance of Rs.75,000 in its Profit & Loss account on 1^st April 2006.  During 2006-2007, its profit before tax amounted to

Rs. 7,62,500.  The income tax provision for the year amounted to be

Rs. 3,47,500.  The company decided to transfer Rs. 60,000 to General Reserve, Rs. 87,500 to sinking fund for redemption of debentures, to pay a dividend for the financial year at the rate of 10%.  The company’s share capital consisted of 3,00,000 shares of Rs. 10 each.  Draw up the Profit & Loss Appropriate account.

15. Statement of the financial position of Mr. Ram is given below:

Liabilities         2006      2007         Assets           2006         2007                                            

Creditors            2,900     2,500       Cash               4,000       3,000

Capital              73,900   61,500       Debtors           2,000      1,700

Stock                 800       1,300

Building        10,000       8,000

Land              60,000     50,000

———   ———                             ———-    ———

76,800     64,000                            76,800     64,000

Additional information:

(i)  There were no drawings

(ii)  There was no purchase or sales of either building or other fixed      assets.

Prepare a Statement of cash flow.

16. Journalise the following transactions in the books of Mr. Hari for the month of January 2008

Rs.

1          Hari started business with capital                   2,50,000

5          Purchased goods from Shankar                         24,000

7          Purchased goods for cash                                    4,000

8          Purchased chairs                                                  1,500

10        Proprietors drawings                                            1,000

11        Paid rent to the landlord , Mr. Ram                     1,700

13        Received interest                                                 1,000

15        Sold goods to Suresh                                           4,000

20        Paid to Shankar  Rs.23,500 and discount received Rs.500

22        Paid salary to the Manager, Mr. Arun                             2,000

17. Prepare a bank reconciliation statement from the following:

Rs.

Bank balance as per Cash Book                                             18,500

Cheques deposited but not collected by the bank                    6,000

Cheques issued but not presented for payment                        4,500

Bank charges debited in the pass book                                        150

Dividend collected by bank not entered in the cash book       1,200

Insurance premium paid by the bank not entered in the

Cash book                                                                               350

18. M/s Sathish & Co furnishes the following information for the month of January 2008. Prepare a Cash book with Cash and Bank columns:

Jan                                                                                 Rs.

1        Balance in Hand                                             1,000

Bank Overdraft                                               3,000

3        Issued a cheque to Sharma                                500

5        Received a cheque from Mr. Charles and

Deposited into bank                                      1,000

7        Drew from bank for office use                          500

9        Paid Life insurance premium in cash                 250

15        Bank collected dividend                                    500

SECTION C

Answer any  five questions:                                                    2 x 10 =40 marks

19. The following is the summary of cash transactions of Chennai Literary Club for the year ended 31^st December 2007

Receipts                    Rs.              Payments                  Rs.

To Balance from last year  3,190        By Rent & Rates         1,680

To Entrance fees                 2,250       By Wages                    2,450

To Subscription                 16,000       By Lighting                    720

To Donations                      1,650       By Lecture fees           4,350

To Life membership fee       2,500      By Books                    2,130

To Interest                              140       By Office expenses     4,500

To Sale of furniture                             By Placed on 6%

(Book value Rs. 500)           720          fixed deposit                        8,000

By Cash at bank          2,420

By Cash in hand            200

——–                                          ——–

26,450                                         26,450

——–                                          ——–

At the beginning of the year, the Club possessed Books worth Rs.20,000 and Furniture worth Rs.8,500.  Furniture worth Rs. 500 was sold on 1.1.07 for

Rs. 720 as shown in the above cash summary. Ordinary Subscription in arrears at the beginning of the year amounted to Rs. 350 and at the end of the year Rs. 450.

Prepare Income and Expenditure Account of the Club for the year ended 31^st December, 2007 and a Balance sheet at that date after writing off Depreciation at 5% per annum on Furniture and 10% per annum on Books.

Entrance fees and Donations to be capitalized.

20. From the following Trial Balance of M/s Ram & Sons, Prepare Trading and Profit and Loss Account for the year ending on 31^st December 2007 and the Balance Sheet as on that date

Dr.                   Cr.

Purchases and Sales                            21,750             35,000

Discount                                                1,300

Wages                                                   6,500

Salaries                                                  2,000

Travelling expenses                                 400

Commission                                            425

Carriage inwards                                     275

Administration expenses                         105

Trade expenses                                        600

Interest                                                                250

Building                                              5,000

Furniture                                                 200

Debtors                                               4,250

Capital                                                                         13,000

Cash                                                    7,045

Creditors                                                                       2,100

———             ———

50,100             50,100

Additional information:-

Stock on 31^st December 2007, was Rs. 6,000.  Depreciate building by 20%.  Create a  provisions  for bad debts at 10% on debtors.  Outstanding wages

Rs. 475.

21. Using the following data, complete the balance sheet below:

Gross profit ratio                                             20%

Current ratio                                                    1.8

Stock turnover ratio                                        4times

Debt collection period                                                20 days

(360 days year)

Long-term debt to equity                                40%

Total assets turnover ratio

(on sales)                                                 0.3 times

Credit sales to total sales                                80%

Gross profit                                                     Rs. 1,08,000

Share capital & Reserves and Surplus            Rs. 12,00,000

Go To Main Page

            LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

B.Sc., B.A. DEGREE EXAMINATION – MATHEMATICS&HISTORY,ECONOMICS

FOURTH SEMESTER – April 2009

CO 4205 / 4201 – FIN. ACCOUNTS & FIN. STAT. ANALYSIS

Date & Time: 27/04/2009 / 9:00 – 12:00  Dept. No.                                                Max. : 100 Marks

SECTION A

Answer all the questions:                                                                    (10  x 2 = 20 marks)

1. List the various types of cash book?
2. What is Bank Reconciliation Statement?
3. Journalise the following:

• Goods worth Rs.1,000 taken by the proprietor for personal use

(ii) Paid Advertisement expenses to Anil & Co.,   Rs.1,500

1. Classify the following under Personal, Real, Nominal account

• Outstanding salary (b)  Goodwill  (c ) Loss by fire  (d)  Purchases

1. Fill in the blanks:

• Purchases book is also known as ___________.
• Journal is the book of _________ entry.

1. Ascertain the amount of profit/loss on sale of machinery:

Cost of Machine  Rs. 1,00,000; Accumulated Depreciation on machinery Rs. 30,000 ;  Sale value of machinery Rs. 85,000

1. Find out Earning per share from the following:

Net profit after tax Rs. 2,00,000

10% Preference Share capital Rs. 4,00,000

Equity share capital (Rs.10 each)  Rs. 1,00,000

1. Calculate the amount of subscription to be credited to Income and expenditure account for the year 2008:

Subscriptions received during 2008                                        Rs.24,000

Subscriptions received in advance for 2009                           Rs.  1,600

Subscriptions outstanding in the beginning of  2008             Rs.  2,000

Subscriptions outstanding at the close of  2008                     Rs.  1,500

1. What are the different modes of expressing ‘Ratios’?
2. Give adjusting entry for the following:

• Depreciation @10% on furniture of Rs. 5,000
• Wages outstanding Rs. 200

SECTION B

Answer any five questions:                                                                 (5 x 8 = 40 marks)

1. Who are the users of accounting information and why do the users need the accounting information?
2. Explain any four accounting concepts.
3. What is ‘Petty cash book’?  What are its advantages?
4. Prepare a bank reconciliation statement from the following data as on 31-12-2008

Rs.

• Balance as per cash book 25,000
• Cheques issued but not presented for payment 18,000
• Cheques deposited in bank but not collected 20,000
• Bank paid insurance premium   8,000
• Direct deposit by a customer   5,000
• Interest on investment collected by bank 12,000
• Bank charges   1,000

15. Enter the following transactions in Rohan’s cash book with discount and cash column:

Date                           Particulars                                                Rs.

Jan  1               Cash balance                                                   18,500

3               Cash sales                                                        33,000

7               Paid David                                                      15,850

Discount allowed by him                                    150

13               Sold goods to Mohan on credit                      19,200

15               Cash withdrawn for personal expenses            2,400

16               Purchased goods form Charles on credit        14,300

22               Paid into bank                                                 22,750

25               Cash received from Mohan                             19,000

Allowed him discount                                                     200

16. A Ltd., provides the following accounting data for the year ending 31^st March 2008 and request you to ascertain (a) Gross profit ratio (b) Net profit ratio

(c) Operating ratio (c) Operating profit ratio

Rs.

Sales                                                                            20,00,000

Gross profit                                                                   8,00,000

Office expenses                                                               60,000

Selling expenses                                                               40,000

Finance expenses                                                             30,000

Loss on sale of plant                                                          4,000

Interest received on investments                                       5,000

Net profit                                                                      6,71,000

1. Naresh Ltd., had a balance of Rs. 80,000 in its Profit & Loss appropriation account on 1^st  April 2007. During 2007-2008, its profit before tax amounted to Rs. 7,62,500.  The income tax provision of the year amounted to be 347,500.  The company decided to transfer Rs. 60,000 to General Reserve, Rs,. 87,500 to sinking fund for redemption of debentures to pay a dividend for the financial year at the rate of 10%.   The company’s share capital consisted of 3,00,000 shares of Rs.10 each.  Draw up the Profit & Loss Appropriation Account.
2. The following balances were extracted from the ledger of Ram on 31^st March 2008.  You are required to prepare a trial balance as on that date in proper form:

Rs.                                                       Rs.

Drawings                                 6,000              Salaries                        9,500

Capital                                     24,000             Sales returns                1,000

Sundry creditors                     43,000             Purchase returns          1,100

Bills payable                              4,000             Travelling expenses     4,600

Loan from Karthik                  10,000             Commission paid           100

Furniture                                   4,500             Trading expenses        2,500

Opening  stock                        47,000             Discount earned          4,000

Cash in hand                                900             Rent                            2,000

Cash at bank                           12,500             Bank overdraft            6,000

Tax                                            3,500             Purchases               1,26,000

Sales                                     1,28,000

SECTION C

Answer any two questions:                                                                 (2 x 20 = 40 marks)

1. The following Trial Balance is extracted from the books of Mr. Rahul on 31-12-2008

Particulars                                           Debit               Credit

Rs.                   Rs.

Furniture                                                                       640

Motor vehicles                                                            6,250

Buildings                                                                     7,500

Capital                                                                                                 12,500

Bad debts                                                                       125

Sundry Debtors and Creditors                                                3,800                 2,500

Stock on 1-1-08                                                          3,460

Purchases and Sales                                                    5,475               15,450

Bank overdraft                                                                                      3,050

Sales and Purchases returns                                          200                     125

Advertising                                                                   450

Interest                                                                                      118

Commission                                                                                             375

Cash                                                                              650

Taxes and insurance                                                    1,250

General expenses                                                           782

Salaries                                                                        3,300               ______

34,000               34,000

Adjustments:

Stock on 31-12-2008 was Rs. 3,250

Depreciate Buildings @ 5% Furniture @ 10% and Motor vehicle @ 20%

Salaries Rs. 300 amd taxes Rs. 120 are outstanding

Insurance prepaid for Rs. 100

Write off further Rs. 100 as bad debts

Prepare Trading and Profit and Loss account for the year ending 31-12-2008 and

a Balance Sheet as on that date.

20  The following is the Receipts and Payments A/c of Delhi football association for the first year ending 31^st Dec 2008

Receipts & Payments Account

Receipts                              Rs.                Payments                             Rs.

To Donation                                  50,000       By Pavilions office              40,000

To Reserve Fund (Life

Membership and entrance fees)    4,000       By expenses in connection

To Receipts from  football                              with matches                            900

Matches                                      8,000       By furniture                           2,100

Revenue Receipts:                                           By Investments at cost         16,000

To Subscriptions                             5,200       Revenue Payments:

To  locker Rents                                   50       By Salaries                             1,800

To interest on securities                     240       By Wages                                 600

To sundries                                         350       By Insurance                             350

By Telephone                            250

By Electricity                            110

By Sundry expenses                 210

                  By Balance on hand               5,520

67,840                                                    67,840

Additional information:

• Subscriptions outstanding for 2008 are Rs. 250
• Salaries unpaid for 2008 are Rs. 170
• Wages unpaid for 2008 are Rs. 90
• Outstanding bill the sundry expenses is Rs. 40
• Donations received have to be capitalized.

Prepare from the details given above and Income and Expenditure A/c for the year ended 31-12-2008 and the Balance Sheet of the Association as on that date.

21.Following are the summarized Balance Sheets of Arul Ltd as on 31^st Dec 2007 and 2008

Balance Sheets

Additional information:

During the year ended 31^st December 2008

• Dividend of Rs. 23,000 was paid
• Depreciation written off on building Rs. 10,000, Machinery Rs. 14,000
• Income tax paid during the year Rs. 28,000

Prepare a statement of cash flow for the year ended 31 Dec 2008.

Go To Main page