LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

           B.Com. DEGREE EXAMINATION – COMMERCE

RO 1

FIRST SEMESTER – APRIL 2008

CO 1500 – FINANCIAL ACCOUNTING

 

 

 

Date : 03-05-08                  Dept. No.                                        Max. : 100 Marks

Time : 9:00 – 12:00

 

PART – A

Answer ALL Questions                                                                     (10 x 2 = 20 marks)

1. What is Trial balance?
2. Explain the term ‘Depreciation’.
3. Calculate the Sales: Cost of goods sold Rs. 1,00,000 & Rate of gross Profit on sale 20%?
4. What are Self-balancing ledgers?
5. Write a note on Stock and Debtors System.
6. What is the meaning of Departmental Accounts?
7. Calculate Cash price if Hire Purchase is Rs. 1,00,000 and Interest is Rs. 25,000.
8. Calculate Short working, if minimum Rent is Rs.5000 & Royalty Rs. 3000.
9. What is loss of profit insurance?
10. How is the loss of stock computed?

 

PART – B

Answer any FIVE Questions                                                           (5 x 8 = 40 marks)

1. Differentiate between Hire Purchase & Instalment System.
2. From the following details Calculate Capital in the beginning?

Rs.

Profit made during the year                2,400

Drawings                                             1,200

Capital at the end                                8,000

Capital introduced during the year     2.000

1. ‘A’ keeps General ledger. Prepare Debtors Ledger Adjustment a/c & Creditor Ledger Adjustments as they would appear in General Ledger from the following particulars.

Rs.

Jan.1    Creditors’ balance                   40,000

Jan.1    Debtors’ balance                     50,000

Transactions during the month of January were as under:

Rs.                                                   Rs.

Credit Sales                             20,000             Discount

Received from Creditors        200

Sundry Charges debited to

Customers            300             Bills Receivable dishonoured    400

Cash received from customers18,000             Bills payable                            3000

Discount allowed                         200             Bills payable dishonoured          300

Bills Receivable received

from Debtors               10,000

Paid cash to creditors              25,000

Credit purchases                     21,000

Purchase Returns                         500

Sales Returns                               200

Allowances from Creditors          100

Bad debts                                  1,000

1. Mr. R of Cochin has opened a branch at Chennai which sells goods for cash only. The following are the transactions between Branch Office and the Head office for the year ended 31.12.2007.

Rs.                                                                            Rs.

Opening Stock                                    2,00,000          Cash Sent to Branch for Rent             2000

Goods supplied to Branch      5,00,000          Cash Sent to Branch for other

Expenses                     1000

Cash received from Branch    6,00,000          Closing Stock                                1,50,000

Petty Cash balance on 31.12.2007       100

Prepare Chennai Branch Account.

 

 

1. The following purchases were made by a business having three Departments:

Dept.               X         —        1000 units

Dept.               Y         —        2000 units

Dept.               Z          —        2400 units

Stock on 1^st Jan were

Dept.               X         —        120 units

Dept.               Y         —        80 units

Dept.               Z          —        152 units

The Sales were:

Dept.               X         —        1020 units @ Rs. 20 each

Dept.               Y         —        1920 units @ Rs. 22.50 each

Dept.               Z          —        2496 units @ Rs. 25 each

Prepare Department Trading Account.

 

1. On 1^st Jan 2004, ‘A’ bought a television from a seller under Hire purchase system, the cash price of which being Rs.10,450 as per the following terms.

• 3000 to be paid on signing the Agreement.
• Balance to be paid on three equal installments of Rs. 3000 at the end of each year.
• The rate of Interest charged by the seller is 10% p.a

Calculate Interest paid by the buyers to the seller each year.

 

1. A company leased a colliery on 1^st Jan 2004 at a Minimum Rent of Rs. 20,000 per year, merging into a royalty of Rs. 1.50 per ton with a power to recorp short workings over the first 3 years of the lease. The output of the colliery for the first four years:

2004→ 9000 tons                   2006 → 16,000 tons

2005→12000 tons                  2007→20,000 tons

 

Pass Journal entries.

 

1.  Fire occurred in the premises on 1.1.2008 and the business books and records were saved. The following information was obtained.

Rs.

Purchases for the year ending 30.06.2007                  60,000

Sales for the year ending 30.06.2007                         90,000

Sales from 1.7.2007 to 31.12.2007                             35,000

Purchase from 1.7.2007 to 31.12.2007                       50,000

Stock on 30.06.2007                                                   28,000

Stock on 30.06.2007                                                   28,000

Stock on 30.06.2006                                                   40,000

Calculate the amount of claim to be presented to the insurance company in respect of the loss by fire.

 

PART – C

 

Answer any  TWO  of the following Questions                               (2 x 20 = 40 marks)

1. Thomas does not maintain his books in the Double entry system and Bank Accounts. From the following information.

Prepare P/L a/c and Balance Sheet as at June 30, 2005

(A) Assets and Liabilities                               30-06-2004                  30-06-2005

Rs                                Rs

Stock                                                      19,800                      1,13,200

Creditors                                                31,000                         14,500

Debtors                                               1,18,000                      1,25,000

Premises                                                 90,000                         90,000

Furniture                                                11,000                         11,500

Air-Conditioner                                     15,000                         15,000

(B) Creditors as on 30-06-2004 includes Rs.15000 for purchase of Air-Conditioner.

(C) Cash transactions:                                          Rs.

Cash as at July 1, 2004                          15,000

Collections form customers                1,60,800

Payments to Creditors (Trade)            1,44,000

Rent, Rates & Taxes                              11, 000

Salaries                                                1,12,000

Sundry expenses                                    18,000

Sundry Income                                      16,500

Drawings by Thomas                             30,000

Loan from Mrs. Fernandes                    23,000

Capital introduced                                 12,000

Cash sales                                               11,500

Cash purchases                                       15,000

Paid to creditor for Air-Conditioner      15,000

(D) Bad debts written off                                    1,200

1.  Crown Industries, Mumbai has a branch at Madurai to which goods are invoiced at cost plus 25%. The branch makes sales both for cash and on credit. Branch expenses are paid direct from head office and the branch remits all cash to head office.

From the following details, prepare the necessary ledger accounts in Head Office books to calculate branch profits as per the Stock and Debtors System.

 

Goods received from H.O at invoice price                                         60,000

Returns to H.O at invoice price                                                            1,200

Branch stock on April 1, 2002 at invoice price                                     6,000

Cash sales                                                                                            20,000

Credit sales                                                                                         36,000

Branch debtors on April 1, 2002                                                          7,200

Cash collected from debtors                                                               32,000

Discount allowed to debtors                                                                    600

Bad debts in the year                                                                               400

Goods returned by debtors to branch                                                      800

Rent, rate and taxes at branch                                                                          1,800

Branch office expenses                                                                            600

Branch stock at invoice prince on March 31, 2003                             12,000

 

1. The M & Co. acquired 5 machines on Hire-purchase system from the V & Co. _____ the cash price for each machine being Rs. 5000. The price was payable in five(5) installments of Rs. 1100 each, every year, the first being paid on signing the contract and the installments included interest charged at 5% per annum. The M & Co decided to provide depreciation at 10% per annum calculated on the diminishing balance method. It paid the first installment due at the end of the first year but could not pay the next.

Give the necessary ledger Accounts in the books of both parties for two years if the V & Co agreed to leave 3 machines with the M & Co adjusting the value of the other 2 machines against the amount due. The machines were valued on the basis of 20% depreciation annually. The Hire vendor spent Rs. 400 on getting the machines thoroughly overhauled and sold them for Rs. 8,800.

 

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LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

QB 01

   B.Com. DEGREE EXAMINATION – COMMERCE

FIRST SEMESTER – November 2008

CO 1500 – FINANCIAL ACCOUNTING

 

 

 

Date : 12-11-08                     Dept. No.                                        Max. : 100 Marks

Time : 1:00 – 4:00

SECTION     A

      Answer ALL                                                                                    (10 x 2 = 20)

1. What are the limitations of single entry system.
2. State the advantages of departmental accounts.
3. State, with reasons in brief, whether the following statement is true or false : The provision for discount

on debtors is calculated after  deducting the provision for doubtful debts from debtors.

4. What is an average clause in a insurence policy?
5. Distinguish between straight line and diminishing balance methods of depreciation.
6. Give journal entries for the following: (i) Goods used for personal consumption- 5,000;

(ii) Stock destroyed by fire-Rs. 50,000-covered fully by insurance.

7. Calculate cash price of the asset taking into consideration the following particulars: Down payment

Rs. 15,000; first, second and third instalments at the end  of each  year Rs. 25,000, Rs. 25,000, and

Rs. 15,000  respectively.  Interest is reckoned at 10% p.a.

8. Find the amount of claim under average clause if a stock of Rs. 3,00,000 is insured for Rs. 2,00,000 and

the loss amounts to Rs. 1,50,000.

9. From the following particulars of Mr. Bhat, under single entry system, ascertain the total sales:

Opening stock Rs. 12,000, purchases  Rs. 60,000, wages Rs. 7,000 closing stock Rs. 15,000, the rate of

gross profit on sales  20%.

10. Madras Traders opened a branch at Bangalore on 1.1.2006. From the following particulars prepare

branch account in the books of Head Office: Goods sent to branch Rs. 20,500,  Cash sent to branch – for

salary Rs. 4,000; for rent Rs. 1,000, Goods returned by branch Rs. 2,000;  Cash received from branch

during the year Rs. 20,000; stock on 31^st December  2006-Rs. 10,000.

 

SECTION    B

Answer any FIVE only                                                                     (5 x 8 = 40)

11. Explain the steps involved in arriving at the claim for loss of profits under consequential loss policy.
12. What do you understand by hire purchase? How does it differ from a purchase on instalment basis?
13. A firm has two departments-cloth and readymade clothes departments. The readymade clothes are

made by the firm itself out of the cloth supplied by the cloth  department at its usual selling price.  From

the following figures, prepare departmental trading and profit and loss account for the year ended 31^st

March, 2004.

 

Particulars                                            Cloth Deptt.              Readymade Clothes Deptt.

Opening Stock                                     Rs. 2,40,000                          Rs. 48,000

Purchases                                                 18,00,000                                 24,000

Sales                                                         20,00,000                              6,00,000

Transfer to readymade clothes dept.          4,00,000                                   —

Manufacturing expenses                                  —                                     68,000

Selling expenses                                            40,000                                   4,000

Closing stock                                              3,00,000                                 60,000

The stock in readymade clothes department may be considered as consisting  80% cloth and rest as

other expenses.  The cloth department earned a gross profit of  25% in 2002-2003.

 

14. Show the relevant adjustment accounts in General Ledger under self-balancing Ledgers.

Rs.

Total balances of Trade Debtors as on 1^st January, 2007                      18,700

Total balances of Trade Creditors as on 1^st January, 2007                    23,560

Transaction during January 2001

Credit Sales                                                                                            19,700

Cash received from Trade Debtors                                                          9,800

Discount Allowed to Trade Debtors                                                           200

Bills Receivable received from Trade Debtors                                      12,000

Bills Receivable received from Trade Debtors dishonoured                   1,000

Credit Purchases                                                                                     25,560

Cash paid to Trade Creditors                                                                  28,800

Discount received from Trade Creditors                                                  1,200

 

15. Nila Ltd. which depreciates its machinery @ 10% per annum according to diminishing balance method,

had on 1^st April, 2006 Rs. 4,86,000 balance in its machinery account. During the year ended 31^st March,

2007, the machinery  purchased on 1^st April, 2004for Rs. 60,000 was sold for Rs. 40,000 on 1^st October,

2006 and a new machinery costing Rs. 70,000 was purchased and installed on the same date; installation

charges being Rs. 5000.

The Company wants to change its method of depreciation from diminishing  balance method to

straight line method w.e.f. 1^st April, 2004and adjust the difference  before 31^st March, 2007, the rate of

depreciation remaining the same as before.

Show the machinery account for the year ended 31^st March, 2007.

 

16. The Sandur Iron Co. has taken on lease a mine on a royalty of 50 paise per tonne of iron ore raised

with a minimum rent of Rs. 20,000 per year, and power to recoup shorworkings during the first four

years was as under:

1^st year 10,000 tonnes,  2^nd year 24,000 tonnes,  3^rd year 40,000 tonnes,  4^th year 90,000  tones.

Prepare Minimum Rent A/c, Royalty A/c, Shortworking A/c and Landlord’s A/c in the books of

      the company. 

 

17. Quick Movers Ltd. acquires two Motor Vans each costing Rs. 18,650 from Karnatak Motors Ltd. on

hire purchase system.  Payment to be made Rs. 10,000 down and the balance in three equal instalments

of Rs. 10,000 each at the end of each year.  The  interest charged is at 5% p.a.  Depreciation to be

provided is at 10% p.a. on diminishing balance method.

Quick Movers Ltd. after having paid the advance and the first instalment at the end of first year, failed

to pay the second instalment because of financial difficulties. Karnatak Motors Ltd. took possession of

theVans and sold them for Rs. 21,998 after spending Rs. 400 on repairs.

Write up the necessary ledger accounts in the books of Quick Movers Ltd.

 

18. Due to heavy fire in the godown of a company on 1^st October, 2005, the entire stock was burnt except

some costing Rs. 35,000.  The books were, however,  saved.

From the information available it was found that:

• The Company’s average gross profit was 25% on sales.
• The stock on 31^st March, 2005 valued at 10% above cost was Rs. 1,10,000.
• The purchases and sales from 1^st April 2005, upto the date of fire were

Rs. 1,50,000 and Rs. 3,40,000 respectively.

• The wages for the period amounted to Rs. 72,000
• The company insured the stock for Rs. 60,000
• The policy had an average clause.

You are required to prepare a statement showing the amount of stock lost by fire and the amount

of claim to be lodged with the Insurance Company.

 

SECTION      C

Answer any TWO only                                                                                        (2 x 20 = 40)

19. Following is the trial balance of Nathan & Co. as on 31^st March, 2007

Rs.                                Rs.

Capital Account                                                                            80,000

Drawing Account                                     6,000

Stock(1.4.2006)                                      45,000

Purchases                                             2,60,000

Sales                                                                                            3,10,000

Furniture                                                 10,000

Sundry Debtors                                       40,000

Freight and Octroi                                     4,600

Trade expenses                                             500

Salaries                                                      5,500

Rent                                                           2,400

Advertising expenses                                5,000

Insurance Premium                                      400

Commission                                                                                  1,300

Discount                                                       200

Bad Debts                                                  1,600

Provision for Bad Debts                                                                   900

Creditors                                                                                      20,000

Cash in hand                                              5,200

Bank                                                           5,800

Goodwill(at cost)                                     20,000____________________

_4,12,200                       4,12,200__

 

Adjustments:

• Stock on 31^st March, 2007 was valued at Rs. 53,000
• Salaries paid have been only for 11 months
• Unexpired insurance included in the figure of Rs. 400 appearing in trial balance is Rs. 100
• Commission earned but not yet received amounting to Rs. 122 is to be recorded in books of account
• Provision for bad debts is to be brought upto 3% of sundry debtors.
• Manager is to be allowed a commission of 10% of net profits after charging such commission
• Furniture is depreciated @ 10% per annum .
• Only 1/4^th of advertising expenses are to be written off.

Prepare trading and profit and loss account for the year ended 31^st March, 2007and balance sheet as on that date

 

20. Southern Traders have opened a branch at Nagpur on 1.1.2000. The goods were sent by the head office

to the branch and invoiced at selling price to the branch which was 125% of the cost price of the head

office.  The following are the  particulars relating to transactions of Nagpur Branch.

Rs.              Rs.

Goods sent to Branch(at cost)                                                                2,80,800

Sales:  Cash                                                                     1,25,000

Credit                                                                    1,75,000         3,00,000

Cash collected from debtors                                                                   1,56,000

Discount allowed                                                                                         4,000

Stock on 31.12.2000

(at invoice price)                                                         55,000

Cash sent to branch for:

Wages                                                                                  3,000

Freight                                                                                11,000

Other expenses                                                                     6,000             20,000

Spoiled good written off(at invoice price)                                                      500

Prepare the necessary accounts in the books of Head Office under   Stock and Debtors System. 

 

    

21.Shri Ramdas commenced business on 1 April, 2006 with a capital of Rs. 45,000  he immediately

purchased furniture of Rs. 24,000.  During the year he borrowed from his father a sum of Rs. 5,000.  He

had withdrawn Rs. 600 per month for his household expenses.  He had no bank account and all dealings

were in cash.  He did not maintain any books but following information is given:

Rs.

Sales(including cash sales of Rs. 30,000)                                 1,00,000

Purchases (including cash purchases of Rs. 10,000)                    75,000

Carriage inwards                                                                                700

Wages                                                                                                 300

Discount allowed to debtors                                                            1,200

Salaries                                                                                            6,200

Bad debts written off                                                                       1,100

Trade expenses                                                                                1,200

Advertisements                                                                                2,200

 

He used goods worth Rs. 1,300 for his personal use and paid Rs. 500 to his son for

examination and college fees.

 

On 31^st March 2007, his debtors were worth Rs. 21,000 and creditors Rs. 15,000.  Stock in trade was

valued at Rs. 10,000.  Furniture to be depreciated by 10% p.a.

Prepare Trading and Profit & Loss Account and the Balance Sheet for the year

ended 31^st  March 2007.

 

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         LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

B.Com. DEGREE EXAMINATION – COMMERCE

KP 01

FIRST SEMESTER – April 2009

CO 1500 – FINANCIAL ACCOUNTING

 

 

 

Date & Time: 20/04/2009 / 1:00 – 4:00  Dept. No.                                                            Max. : 100 Marks

 

 

                                                                  SECTION – A

Answer ALL questions:                                                                                  10 x 2 = 20     

1. Choose the correct answer:

Income Tax paid by a sole trader is shown:

• On the debit side of Trading Account
• On the debit side of Profit & Loss Account
• By way of deduction from the capital in the balance sheet.

2. Fill in the blanks:

The difference between cash sent accounts appearing in the two trial balances i.e. branch trial balance and head office trail balance is called _______________.

3. Royalty account is in the nature of ___________________ account.
4. True of False

If the goods are transferred form department X to department Y at selling price which includes a profit of 25% on the cost, the amount of stock reserve on such closing stock(Valued at Rs.60,000) of department Y will be Rs. 15,000.

5. Ascertain purchases from the following figures:

Cost of goods sold	Rs. 80,700
Opening stock	5,800
Closing stock	6,000

6. Mahendra and Narendra purchased two assets, particulars of which are given as under:

	Cost	Scrap value		Estimated life
Furniture	Rs. 73,200	Rs. 480	6 years
Plant	Rs. 1,52,800	3,280	8 years

You are required to determine the amount of depreciation to be written off in each case. Assume the company has adopted straight-line method of depreciation.

7. Calculate the missing figure:

Capital in the beginning?	Capital at the end Rs. 1,82,000
Capital introduced Rs. 47,000	Drawings Rs. 28,000
Loss Rs. 14,000

8. Calculate bills received from customers:

Opening balance of bills Rs. 7,000	Bills received endorsed to creditors Rs. 1000
Bills dishonoured by customers Rs. 2,000	Bills collected Rs. 13,000
Closing balance of bills Rs. 6,000

9. Calculate cash price of Machine from the following information:

Down payment Rs. 10,000	Rate of Interest 5% p.a
4 annual Instalments at the end of each year Rs. 10,000

10. Stock of Rs. 80,000 of M/S Kailash chand & sons has been insured for Rs. 70,000. Loss due to fire is assessed at Rs. 20,000. Calculate what claim M/s Kailash Chand & Sons will get from the Insurance company.

SECTION – B

Answer any FIVE questions:                                                             5 x 8 = 40

11. What causes depreciation? Discuss them.
12. Distinguish between hire-purchase and Instalment-purchase system.
13. Explain in brief the procedure of calculation of total stock and claim for stock lost on the date of fire.
14. Naresh commenced business in March 2000. He acquired some machines for Rs. 2,00,000 on April 1, 2000. He acquired another machine for Rs. 50,000 on March 1, 2002. He sold Machines, original cost of which was Rs. 60,000 for Rs. 35,000 on October 31, 2001. Assuming depreciation @ 15% under written down value basis, compute the depreciation for the year ended March 31, 2001 and March 31, 2002. Depreciation to be calculated to the nearst rupee.
15. The following details were extracted from the books of a company for six months ended 31^st March, 2003.

2002 Oct 1 Total balances of accounts of                   2002 Oct 1 Provision for

customers Rs. 3,72,000                                                          doubtful debts Rs. 25,000

The transactions for six months ended 31^st March, 2003:

Credit Sales	Rs. 7,30,000	Returns from customers	Rs. 7,400
Cash received by customers	Rs. 7,08,000	Cheques dishonoured	Rs. 2,800
Bills accepted by customers	Rs. 26,000	Bills dishonoured	Rs. 3,600
Bills endorsed	Rs. 7,000	Bad debts written off	Rs. 6,300
Carriage charged to customers	Rs. 1,200	Cash paid to customers for returns	5,000
Cash discount allowed	Rs. 17,800	Bad debts previously written off recovered	1,200
Transfer from bought	Rs. 3,000

Prepare sales ledger adjustment account in general ledger.

16. The super cycles has a branch at Chennai. Goods are invoiced to the branch at cost plus 25%. Branch is instructed to deposit cash every day in the head office account in the bank. All expenses are paid by cheque by the head office except petty cash expenses which are paid by the Branch manager. From the following particulars, prepare branch account in the books of head office:

Stock on 1st January 2002	Rs. 2,500	Stock on 31st December 2002	Rs. 3,000
Sundry debtors on 1st January 2002	Rs. 1,400	Sundry debtors on 31st December 2002	Rs. 1,800
Cash sales for the year	Rs. 10,800	Credit sales for the year	Rs. 7,000
Cash remitted to the head office	Rs. 15,000	Furniture purchased by the Br. Manager	Rs. 1,200
Goods invoiced from the head office	Rs. 18,200	Expenses paid by head office	Rs. 1,640
Expenses paid by the Branch	Rs. 120	Cash remitted by H.O to the Branch for purchase of safe	Rs. 1,300

17. A company leased a mine of 1^st January, 1999 at a minimum rent of Rs. 20,000 merging into a royalty of Rs. 1.50 per ton with power to recoup shortworkings over the first three years of the lease. The output of the mine for the first three years was 9000 tons, 12000 tons, and 16000 tons respectively.

Pass the necessary journal entries for each of the three years in the books of the company.

18. Fire occured in the premises of Mr. Srinivasan on May 1, 2003 and the stock was destroyed. Following information was available from the records:

Purchases for the year 2002	Rs. 8,88,000	Sales for the year 2002	Rs. 11,60,000
Purchases form Jan 1, 2003 to May 1, 2003	Rs. 1,82,000	Sales from Jan 1, 2003 to May 1, 2003	Rs. 2,40,000
Stock on January 1, 2002	Rs. 1,44,000	Stock on December 31, 2002	Rs. 2,42,000
Wages paid during 2002	Rs. 1,00,000	Wages paid during Jan 1, 2003 to May 1, 2003	Rs. 18,000

The stock salvaged was Rs. 25,000. A fire insurance policy for Rs.2,00,000 was taken to cover the loss by fire.

There was a practice in the concern to value the stock at cost less 10%. But this practice was changed and stock on December 31, 2002 was valued at cost plus 10%.

Calculate the amount of claim to be submitted with the Insurance Company for stock lost by fire.

SECTION – C

Answer any TWO questions:                                                             2 x 20 = 40

19. Komco Ltd carries on its business through five departments A,B,C,D and E. The following information for 2002 is made available:

• Salaries Rs. 11,020; Rent Rs.5,800; Insurance Rs.1,160; Miscellaneous Expenses Rs. 2,610 All these expenses are chargeable to each department in proportion to the cost of articles sold in respective department.
• The following balances as at 31.12.2002 were ascertained.

Particulars	A	B	C	D	E
	Rs.	Rs.	Rs.	Rs.	Rs.
Opening stock at cost	10,000	6,000	15,000	8,000	9,000
Purchases	1,00,000	60,000	20,000	52,000	60,000
Sales	96,000	62,000	19,000	46,000	60,000
Closing Stock	23,000	8,000	6,000	2,000	11,000

Prepare the profit & loss account to show the result of each department and also the combined

results with respective % on sales.

20. Thiru Thomas does not maintain his books in the Double Entry System. From the following information, prepare Trading, Profit & Loss A/C and Balance Sheet as at March 31, 2003:

(i)

Assests and liablilities	31.3.2002	31.3.2003
	Rs.	Rs.
Stock	19,800	1,13,200
Creditors	31,000	14,500
Debtors	1,18,000	1,25,000
Premises	90,000	90,000
Furniture	11,000	11,500
Air-Conditioner	15,000	15,000

(ii)  Creditors as at 31.3.2002 include Rs. 15,000 for purchase of Air-Conditioner.

(iii)

Cash transactions:	Rs.
Cash as at April 1, 2002	15,000
Collections from customers	1,60,800
Payments to creditors (Trade)	1,44,000
Rent, rates and taxes	11,500
Salaries	1,12,000
Sundry expenses	18,000
Sundry Income	16,500
Drawings by Thomas	30,000
Loan from Mrs. Fernandes	23,000
Capital introduced	12,000
Cash sales	11,500
Cash purchases	15,000
Payment to creditor for Air-conditioner	15,000

(iv) Bad debts written off                                1,200

21. X purchased five trucks on hire purchase basis on October 1, 2001. The cash price of each truch was Rs. 5,50,000. X was to pay 20% of the cash price at the time of delivery and 25% of the cash price at the end of each of the four subsequent half years beginning from March 31, 2002.

On X’s failure to pay the instalment due on September 30, 2002, it was agreed that X could keep three trucks on the condition that the value of the two trucks would be adjusted against the amount due, the trucks being valued at cost less 25% depreciation.

Show the relevant accounts in the books of X, assuming that the books of account are

closed every year on March 31, and depreciation @ 15% is charged on the original cost of the trucks.

 

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LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

   B.Com. DEGREE EXAMINATION – COMMERCE

FIRST SEMESTER – NOVEMBER 2010

CO 1500 – FINANCIAL ACCOUNTING

 

 

 

Date : 10-11-10                     Dept. No.                                        Max. : 100 Marks

Time : 1:00 – 4:00

 

SECTION – A

Answer All questions:                                                                                   (10 x 2 = 20 Marks)

 

1. What do you mean by cost of goods sold?
2. Give the adjusting entries for the following appearing under the Trial balance:

(i)      Prepaid Insurance                     (ii) Depreciation on Machinery

(iii)    Closing stock                            (iv) Goods issued as samples

 

3. Depreciation is a process of : (Choose the correct answer)

(a) Valuation of asset                                            (b) Allocation of cost

(c) Both valuation of asset and allocation of cost   (d) None of these

 

4. Bills receivable endorsed are debited to: (Choose the correct answer)

(a) B/R  A/c.                    (b) B/P A/c            (c) debtors A/c.     (d) Creditors A/c.

 

5. Calculate the missing figure: Opening Capital Rs.1,50,000, Profits Rs.60,000,

Closing capital Rs.3,90,000,  Drawings or Capital introduced Rs. ________.

 

6. Explain the terms: Goods in Transit, Cash in Transit.

 

7. What is ‘inter-departmental transfer’ and how is this treated in accounts?

 

8. Calculate total interest when cash price is Rs.5,00,000 and down payment is Rs.1,25,000. Three annual instalments are of Rs.1,21,000, Rs.1,33,100 and Rs.1,46,410 are to be paid.

 

9. What is minimum rent?

 

10. It is given that short sales were Rs.2,04,000 and that of gross profit on sales was 25%. Hence the loss of profit will be equal to: (choose the correct answer)

(a)     Rs.40,800                                (b)     Rs.51,000

(c)     Rs.68,000                                (d)     Rs.55,000

SECTION – B

Answer any FIVE Questions:                                                                         (5×8=40marks)

 

11. State the features and defects of single entry system.
12. What are the special terms used in hire-purchase? Explain in detail.
13. Define depreciation. What factors do you consider for calculating depreciation?
14. Gopal purchased a machine for Rs.8,000 on 1^st April 2001. He spent Rs.3,500 on its repair and installation.  Depreciation is written off @ 10% p.a. on the Diminishing balance Method.  On 30^th June 2004 the machine was found to be unsuitable and sold for Rs.6,500.  Prepare the machine account from 2001 to 2004 assuming that the accounts are closed on 31^st December every year.

 

15. From the following details, write General Ledger adjustment accounts as on 31.12.2008.

Rs.                                                              Rs.

Debtors (1.1.2008) Dr       1,74,250      Bills accepted for Creditors                   74,000

Debtors (1.1.2008) Cr            3,200      Discount allowed to debtors          2,150

Creditors(1.1.2008)Cr       2,74,080      Discount allowed to debtors

Creditors(1.1.2008) Dr           2,040      but later on disallowed                   1,000

Purchases                         2,52,000      Cash received from debtors          87,000

Sales                               2,82,090      Discount allowed by creditors      10,200

Sales Returns                       2,080      Cash paid to debtors                         250

Purchases returns                  7,140      Transfer from debtors to               12,420

Cash paid to Creditors       1,27,000     creditors ledger

Bills received from debtors    93,000      Cash purchases                            43,200

Bills dishonoured                    2,000     Cash sales                                  74,000

Bad debts written off              2,150

 

16. From the data, prepare Departmental Trading, Profit & Loss account and thereafter the combined income account revealing the concern’s true result for the year ended 31.12.2008.

Dept. A                          Dept.B

   Rs.                                  Rs.

Stock (January)                                 40,000                                –

Purchase from outside                     2,00,000                           20,000                  Wages                                                10,000                             1,000                  Transfer of goods from Dept.A               –                                 50,000

Stock (Dec 31^st) at Cost of the Deptt. 30,000                           10,000

Sale of outsiders                              2,00,000                           71,000

 

B’s entire stock represents goods from Deptt.A which transfers them at 25% above its cost.  Administrative and selling expenses amount Rs.15,000 which are to be allocated between departments A and B in the ratio 4:1 respectively.

 

 

 

 

 

 

 

17. Rajan took licence from Golden Flask Co. for production and sale of flasks at a royalty of Rs.0.50 per piece sold subject to a minimum rent of Rs.6000. short working is recoverable within 3 years of agreement. Pass journal entries in the books of Rajan.

     Year                    I                  II                III             IV

Production             8000           11000                   14000                   6000

Closing Stock         2000             1600                     3000                   4000

 

18. A fire occurred in the premises of a company on 15.10.2008. From the following data, ascertain the loss of stock and prepare a claim for Insurance.

Rs.

Stock on 1.1.2007                                                             30,600

Purchases from 1.1.2007 to 31.12.2007                         1,22,000

Sales from 1.1.2007 to 31.12.2007                                1,80,000

Stock on 31.12.2007                                                         27,000

Purchases from 1.1.2008 to 15.10.2008                         1,47,000

Sales from 1.1.2008 to 15.10.2008                                1,50,000

Value of stock salvaged was                                              18,000

Amount of policy was                                                         63,000

Stocks were always valued at 90% of cost

 

There was an average clause in the Policy.

 

SECTION  – C

 

Answer any TWO Questions:                                                                 (2×20=40marks)

 

19. A head office invoices goods to its branch at cost plus 50%. Branch remits all cash received to the head office and all expenses are met by the H.O. From the following particulars, prepare the necessary accounts on the stock and debtors system to show the Profit or loss at the branch.

Rs.                                                             Rs.

Stock on 1.1.2008          27,900        Goods returned by debtors       3600

(Invoice price)

Debtors on 1.1.2008       20,400        Goods returned to H.O.by branch    4500

Goods invoice to the                          Shortage of stock                     1350

Branch (Invoice Price)   1,53,000       Discount allowed                        600

Cash sales                      75,000        Expenses at the branch           16200

Credit sales                     93,000        Bad Debts                                   600

Cash collected from

Debtors                           91,200

 

20. Mohan purchased a machine on hire purchase system on 1.1.2008. The terms of payment are four annual instalment of Rs.12,690 at the end of each year.  Interest is charged @ 5% and is included in the annual payment of Rs.12690. Show machinery account and hire vendor account in the books of Mohan who defaulted in the payment of the third yearly payment whereupon the vendor repossessed the machinery.  Mohan provides depreciation on the machinery @ 10% p.a. on the reducing balance.

 

21. The Position of Manohar’s business as on 1.1.2008 was as under: Sundry Creditors Rs.1,70,000 ; Freehold premises Rs.5,00,000 ; Stock Rs.2,50,000 ; Sundry debtors Rs.2,00,000; Furniture Rs.20,000.

An abstract of the cash book is appended below

       Receipts            Rs.                    Payments                            Rs.

Sundry Debtors     1,50,000               Overdraft(1.1.2008)        1,00,000

Cash sales             8,00,000               Expenses                         5,00,000

Drawings                             30,000

Sundry Creditors               2,00,000

Cash in hand                       20,000

Cash at bank                    1,00,000

 

9,50,000                                                       9,50,000

The following additional information is available: Closing Stock Rs.3,00,000; Closing Debtors Rs.2,50,000 ; Closing Creditors Rs.1,20,000. No additions were made during the year to premises and furniture but they are to be depreciated @ 10% and 15% respectively.  A bad debts provision of 2.5% is to be raised.

 

Prepare a Trading and profit and loss account for the year ended 31.12.2008, and a balance sheet as on that date.

 

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LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

B.Com. DEGREE EXAMINATION – COMMERCE

FIRST SEMESTER – APRIL 2012

CO 1500 – FINANCIAL ACCOUNTING

 

 

 

Date : 28-04-2012              Dept. No.                                        Max. : 100 Marks

Time : 1:00 – 4:00

 

PART – A

Answer ALL the questions:                                                                                     (10×2=20 Marks)

 

1. What do you understand by “Self – Balancing System of Ledger”?
2. State any four objectives of preparing departmental accounts.
3. What is minimum rent?
4. Under stock and debtor system, cost of shortage is debited to
5. a) Branch adjustment a/c    b) Branch stock a/c
6. c) Branch profit & loss a/c d) Goods sent top branch a/c
7. Hire purchaser is in the position of a ———— with regard to goods obtained on hire purchase
8. a) Creditor     b) Debtor    c) Bailor         d) Bailee
9. Salary paid to manager must be debited to:
10. a) Manager’s A/c b) Office expenses A/c c) Salaries A/c             d) Trading A/c
11. A firm purchased a plant for Rs.60,000. Erection charges Rs.5,000. Effective life of the plant is 13 years. Calculate the amount of depreciation per year under Straight Line Method.
12. A fire occurred in a firm on 10^th Value of stock on that date was Rs.80,000, but it was insured for only Rs.56,000. Stock destroyed by fire was Rs.50,000. Find the claim.
13. A purchased a machine on hire-purchase basis. The cash price of the machine was Rs.22,350. As per the terms, the buyer had to pay Rs.6,000 on signing the agreement and the balance in three annual instalments of Rs.6,000 each. Vendor charges interest at 5% p.a. Calculate the interest amount for the first instalment.
14. Calculate debtors’ balance at the end:

Opening debtors Rs.40,000

Total sales Rs.1,60,000

Cash sales Rs.20,000

Cash received from customers Rs.60,000

Bad debts Rs.4,000

Returns inward Rs.1,000

Bills received from customers Rs.18,000.

 

PART – B

Answer any FIVE questions:                                                                                   (5×8=40 Marks)

 

11. Distinguish between a Trail Balance and a Balance Sheet.
12. State the advantages of “Self – Balancing System of Ledger.
13. Give the differences between hire purchase and instalment purchase system.
14. On 1st April 2001, Kumar purchased a secondhand machine for Rs.80,000 and spent Rs.20,000 on its

cartage, repairs and installation. The residual value at the end of its expected useful life of 4 years is

estimated at Rs.40,000. On 30th September 2003, this machine is sold for Rs.50,000. Depreciation is

to be provided according to straight line method. The Books are closed on 31^st December every year.

Prepare Machinery Account.

 

 

15. From the following particulars, calculate credit sales and credit purchases.

	(Rs.)
Debtors as at 31.3.2002	28,000
Debtors as at 31.3.2001	24,000
Sales returns	1,000
Cash received from Debtors	74,800
Bills receivable drawn	26,000
Discount allowed	1,000
Bad debts	1,000
Cheques received from debtors	10,000
Bills receivable dishonoured	4,000
Cheque dishonoured	6,000

 

	(Rs.)
Balance of creditors on 31.3.2001	5,000
Returns outwards	3,000
Cash paid to creditors	25,000
Discount allowed by creditors	1,000
Bills accepted	5,000
Balance of creditors on 31.3.2002	10,000

 

16. Trading and Profit and Loss A/c of Janaki Radio and Gramophone Equipment Co. for the six months

ended 31.3.1993 is presented to you in the following form:

Particulars	Rs.	Particulars	Rs.
Purchases		Sales
Radio (A)	1,40,700	Radio (A)	1,50,000
Gramophones (B)	90,600	Gramophones (B)	1,00,000
Spare parts ( C)	64,400	Spare parts ( C)	25,000
Salaries & wages	48,000	Stock as on 31.3.93
Rent	10,800	Radio (A)	60,100
Sundry expenses	11,000	Gramophones (B)	20,300
Profit	34,500	Spare parts ( C)	44,600
	4,00,000		4,00,000

 

Prepare departmental accounts for each of the three departments A, B and C mentioned above

after taking into account the following:

1. i) Radios and Gramophones are sold at the show room and spare parts at workshop.
2. ii) Salaries and wages comprise as follows: Show rooms ¾ and workshop ¼.

It was decided to allocate the show room salaries and wages in the ratio of 1:2 between the

departments A and B.

iii) The work shop rent is Rs.500 per month. The rent of show room is to be divided equally

between the departments A & B.

1. iv) Sundry expenses are to be allocated on the basis of the turnover of each department.

 

17. X purchased a type writer on hire – purchase system. As per terms, he is required to pay Rs. 800

down, Rs. 400 at the end of the first year Rs. 300 at the end of the second year and Rs. 700 at the end

of the third year. Interest is charged at 5% p.a.  Calculate the total cash price of the typewriter and the

amount of interest payable on each installment.

 

 

 

 

 

 

18. A fire occurred in the premises of Mr. Bean on 5.9.2002. All stocks were destroyed except to the

extent of Rs.5,000. From the following figures, ascertain the loss of stock suffered by him.

	Rs.
Stock on 1.1.2001	30,000
Purchases during 2001	1,50,000
Sales during 2001	2,00,000
Stock on 31.12.2001	40,000
Purchases during 2002 upto the date of fire	1,40,000
Sales during 2002 upto the date of fire	1,70,000

 

 

PART – C

Answer any TWO questions:                                                                                   (2×20=40 Marks)

 

19. From the following Trial Balance as on 31.3.2006 and the adjustments given, prepare Trading and

Profit and Loss A/c for the year ending 31.3.2006 and the Balance Sheet as on 31.3.2006.

Particulars	Dr. (Rs.)		Cr. (Rs.)
Opening Stock	15,000	Capital	25,000
Machinery	30,000	Purchase Returns	1,000
Purchases	40,000	Bills payable	5,000
Sales Returns	2,000	Sales	1,24,000
Wages	10,000	Sundry Creditors	5,000
Salaries	5,000	Provision for doubtful debts	500
Office rent	12,000	Provision for discount on debtors	100
Insurance	6,000
Sundry Debtors	20,000
Cash	4,000
Bank Balance	15,600
Bad debts	1,000
	1,60,600		1,60,600

Adjustments:

1. Closing stock at the year end was Rs.30,000
2. Further bad debts amounted to Rs.500
3. 5% of the profit is to be appropriated for creating Reserve fund
4. Create 5% provision for doubtful debts on debtors
5. Create 2% provision for discount on debtors
6. Create 1% reserve on creditors.

 

20. Madras Ltd., invoices goods to its branch at cost plus 331/3%. From the following particulars prepare

the Branch Stock Account the Branch Stock Adjustment Account and Branch Profit & Loss Account

as they would appear in the books of Head Office:

	Rs.
Stock at Commencement at Branch at invoice price	1,50,000
Stock at Close at Branch at invoice price	1,20,000
Goods sent to branch during the year at invoice price
(including goods invoiced at Rs. 20,000 to branch on
31.3.95 but not received by branch before close of the Year)	10,00,000
Return of goods to Head Office (invoice price)	50,000
Cash sales at Branch	9,00,000
Credit Sales at Branch	50,000
Invoice value of goods pilfered	10,000
Normal loss at Branch due to shortage and deterioration
of stock ( at invoice price)	15,000
Madras Ltd. closes its books on 31st March, 1995
Goods lost in transit	10,000
Claim from insurance Co.	8,000

 

21. Mr. N wrote a book on Management and got it published with M/s Nachiar publications on the terms

that royalties will be paid @ Rs.5 per copy sold subject to a minimum amount of Rs.15,000 with a

right of recoupment of short workings over the first three years of the lease. From the following

prepare

(a) Royalties A/c, (b) Short working A/c and (c) Mr. N’s A/c.

The other details are:

Year    No. of copies printed              Closing stock

1991                2,000                                       100

1992                3,000                                       200

1993                4,000                                       400

1994                5,000                                       500.

 

 

 

 

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LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

B.Com. DEGREE EXAMINATION – COMMERCE

FIRST SEMESTER – NOVEMBER 2012

CO 1500 – FINANCIAL ACCOUNTING

 

Date : 08/11/2012               Dept. No.                                          Max. : 100 Marks

Time : 1:00 – 4:00

PART – A

Answer ALL questions:                                                                                                                   (10 X 2 = 20 MARKS)

1. How do you arrive at Gross profit?
2. What is single Entry System?
3. Explain the term “Depreciation”
4. Choose the correct alternative:

The loss on sale of old motor car is debited to

1. Profit & loss Account
2. Motor car Account
3. Depreciation Account
4. None of the above
5. Indicate if the following statement is true or false:

Net profit is equal to capital at the end + Drawings + Fresh capital introduced – capital in the beginning.

6. In Departmental Accounts, Rent and Rates are allotted to different departments on the basis of

—————————————.

7. Calculate the capital at the beginning of the year:

Rs

Capital at the end of the year                                              70,000

Drawings during the year                                                      10,000

Capital introduced during the year                                      5,000

Profit during the year                                                              20,000

 

8. From the following particulars, calculate closing branch debtors balance:

Rs

Branch Debtor (1-1-08)                                                       6,300

Credit Sales                                                                                 39,000

Cash received from debtors                                                  41,200

9. Calculate insurance claim from the following facts assuming that the insurers met their liability under the policy on ‘average basis’. A trader’s stock valued at Rs. 20,000 was totally destroyed. The stock in the godown was insured for Rs. 15,000 subject to average clause. The balance of stock, left after fire, appeared in the books at Rs. 12,000.

 

10. On 01.01.2005, x bought some trucks under hire – Purchase System for Rs. 51,000 payable by three equal installments combining principal and interest, the latter being a normal rate of 5% P.a. Calculate the cash price. (The present value of an annuity of one rupee for three years at 5% is Rs. 2.72325).

PART- B

Answer any FIVE questions:                                                                                                       (5X8=40 MARKS)

11. What are the features of Dependent Branches?
12. What is average clause? How do you compute claim for loss of stock when there is average clause in the contract?
13. How profit or loss is ascertained under the net worth method in single Entry System?
14. A manufacturing concern, whose books are closed on 31^st December every year, purchased machinery for Rs 50,000 on 1.1.2000 Additional machinery was acquired for Rs. 10,000 on 1.7.2001 and for Rs. 16,061 on 1.1.2004. Certain machinery purchased for Rs. 10,000 on 1.1.2000 was sold for Rs. 5,000 on 30.6.2003.

Give the machinery account for 5 years writing off depreciation at 10% p.a on written down value.

15. The following particulars have been extracted from the books of Mr.A. you are required to prepare the sales ledger Adjustment Account as June 30,2004.

Rs

Balance as on January 1,2004                                                                                                55,842

Credit Sales                                                                                                                                  98,602

Cash Sales                                                                                                                                     53,250

Cash received from Debtors                                                                                                 88,753

Discount allowed                                                                                                                            480

Bills accepted                                                                                                                                7,120

Returns Inwards                                                                                                                          5,430

Bills Receivable Dishonored                                                                                                    1,120

Bad debts written off                                                                                                                3,890

Amount received against bad debts written off last year                                                             175

Sundry charges debited to customers                                                                                 378

Transfers to Bought ledger                                                                                                      100

16. A fire occurred in the godown of a company on 20^th March, 2005. All stocks were destroyed except to the extent of Rs. 13,000. From the following figures ascertain the claim amount in respect of loss of stock by fire:

Rs

Stock on 01.01.04                                                                                                       40,000

Purchases during 2004                                                                                          1,40,000

Sales during 2004                                                                                                    2,00,000

Stock on 31.12.04                                                                                                       24,000

Purchases during 2005 up to the date of fire                                               1,46,000

Sales during 2005 up to the date of fire                                                         1,60,000

Stock was always valued at 80% of the cost.

17. Behavar coal company has taken a mine on lease. Royalty has been fixed at Rs. 0.50 per tonne. Minimum Rent is Rs 30,000. The right to recoup royalty is 5 years. The details of production for the first three years are as follows:

Year	Quantity Produced (Tones)
I   II   III	15,000   50,000   75,000

Prepare minimum rent account, Royalty account and Short workings Account.

18. G Purchased machinery under hire purchase arrangements from Mr. B. The cash price of the machinery was Rs 15,500 Payment for the purchase is to be made as under:

On signing the agreement Rs 3,000; First years end Rs 5,000; second year end Rs 5,000; Third year end Rs 5,000. Depreciation is charged at 10% on diminishing balance method. Show the asset account and the hive vendor account in the books of the Purchases.

PART – C

Answer any TWO Questions:                                                                                                     (2X20=40 MARKS)

19. The following Trial Balance of Mr. Arumugam as at December 31,2004 is given to you:

 

Debit Balances	Rs	Credit Balances	Rs
Stock on 1.1.04 Furniture Cycle Lorry Sundry Debtors Cash in hand Cash at Bank Purchases Bad debts Returns Inwards Salaries Wages Rent Discount allowed Commission Postage	36,000 2,000 600 60,000 32,000 1,200 4,800 1,80,000 1,000 10,000 16,000 22,000 7,200 1,800 1,400 800	Sundry Creditors Loan Capital Sales Returns outwards Discount earned Bills payable	30,000 14,000 50,000 2,60,000 4,000 2,200 16,600
	3,76,800		3,76,800

 

Taking into account the following adjustments, prepare Trading and profit and loss account and Balance sheet as on that date:

• Depreciate Furniture at 10% ; Cycle at 5% ; Lorry at 20%
• Create a Reserve of 5% on sundry debtors for bad and doubtful debts and 1% reserve for discount on sundry creditors
• Outstanding salaries Rs 3,000.
• Closing stock was valued at Rs 48,000,
• Provide for 5% interest on capital.

 

20. A Trader keeps his books under single entry system. From the following details, prepare trading and profit & loss A/C and Balance sheet:

 

	As on 01.01.05 Rs	As on 31.12.05 Rs
Creditors Furniture Cash Debtors Stock	37,500 2,500 6,250 62,500 25,000	43,750 2,500 10,000 87,500 12,500

 

Other details:

Drawings Rs 10,000 ; Bad debts Rs 1,250 ; Discount received Rs 3,750 ; Discount allowed Rs 2,500 ; sundry expenses Rs7,500 ; payment to creditors Rs 1,12,500 ; collections from debtors Rs 1,33,750 ; Sales Returns Rs 3,750 ; Purchase Returns Rs 1,250 ; charge 5% Depreciation on furniture.

21. A head office invoices goods to its branch at cost plus 50% Branch remits all cash received to the head office and all expenses are met by the Head office.  From the following particulars, prepare the necessary accounts on the stock and debtors system to show the profit or loss at the branch.

	Rs.		Rs.
Stock on 1.1.05 (invoice Price)	27,900	Shortage of stock	1,350
Debtors on 1.1.05	20,400	Discount allowed	600
Goods invoiced to branch (invoice price)	1,53,000	Expenses at the Branch	16,200
Cash Sales	75,000	Bad debts	600
Credit Sales	93,000
Cash collected for Debtors	91,200
Good returned by Debtors	3,600
Good returned to Head office by branch	4,500

 

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LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

B.Com. DEGREE EXAMINATION – COMMERCE

FIRST SEMESTER – NOVEMBER 2012

CO 1502 – FINANCIAL ACCOUNTING

 

 

Date : 08/11/2012             Dept. No.                                        Max. : 100 Marks

Time : 1:00 – 4:00

 

PART – A

 

ANSWER ALL THE QUESTIONS:                                                                            (10×2=20)

 

1. What are the different types of branches?
2. [a] Hire Vendor may take away only a portion of goods on which there is default of

installment___________

[b] ________________is the advance payable by the buyer while signing hire purchase agreement.

1. Say True or False:

[a] Single entry is an incomplete system of accounting because here only personal accounts are

maintained.

[b] Depreciable assets are expected to be used for an accounting period.

1. Match the following:

[a] Fixed assets          –      Mines, quarries

[b] Nominal assets    –      Bills Receivable

[c] Liquid assets         –      Building

[d] Wasting asset      –       Discount on shares.

1. What is the need for Departmental Accounting?
2. From the following data calculate Capital at the beginning of the year.

Capital at the end of the year             –   Rs.70,000

Drawings during the year                    –   Rs.10,000

Capital introduced during the year   –   Rs.5,000

Profit made during the year               –   Rs.20,000

1. In what basis the following expenses apportioned in departmental accounting?

[a] Selling expenses                [b] Canteen expenses

[c] Depreciation                       [d] Carriage inwards

1. Cash Price of the Machinery Rs.20,000. Down payment Rs.5,000, four annual installments of Rs.5,000 each. Calculate interest for each of the four years.
2. Why do you prepare a Statement of Affairs ?
3. Why do you prepare a Trading account?

 

PART – B

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

11. State the various methods of depreciation.
12. Distinguish between Statement of Affairs and Balance Sheet.

 

13. Define HRA. Enumerate the advantages of HRA.

 

14. On 01.01.2002, X purchased a machine for Rs.50,000. On 01.07.2003 additions were made for

Rs.10,000. On 01.04.2004, Rs.6,400 worth of additions were made. On 31.12.2004, 1/4^th of the first

machine purchased on 01.01.2002 was sold for Rs.7,000. Show machinery account from 2002 to 2004

in the books of X under diminishing balance method at 10% per annum.

 

15. From the following details, prepare Departmental Account:

Particulars	Department A Rs.	Department B Rs.
Opening stock Total Purchases Total sales Closing stock Credit purchases Credit sales	9,000 27,000 42,000 10,800 17,000 5,000	8,400 21,600 36,000 4,800 10,600 6,000

 

Transfer of goods from Departments A to B  Rs.4,000

 

Transfer of services from Departments B to A Rs.500

 

16. The Calcutta Commercial Company invoiced goods to its Jamshedpur Branch at cost. The Head

Office paid all the expenses from its bank except petty cash expenses which were paid by the branch.

From the following details relating to the Branch, prepare,

1) Branch stock A/c       2) Branch Debtors A/c   3) Branch Expenses A/c   4) Branch P&L A/c

 

	Rs		Rs
Stock ( Opening ) Debtors ( Opening ) Petty cash ( Opening ) Goods sent from HO Goods returned to HO Cash sales Advertisement Cash received from Debtors Stock ( Closing ) Allowance to customers	21,000 37,800 600 78,000 3,000 52,500 2,400 85,500 19,500 600	Discount to customers Bad debts Goods returned to branch by customers Salaries & Wages Rent & Rates Debtors(Closing) Petty cash ( Closing ) Credit sales	4,200 1,800 1,500   18,600 3,600 29,400 300 85,200

 

 

 

 

 

 

 

 

17. From the following information calculate credit purchases and total purchases:

	Rs.
Cash purchases Opening balance of bills payable Opening balance of creditors Closing balance of Bills payable Closing balance of creditors Cash paid to creditors Cash paid to bills payable in the relevant year Purchase returns Allowance from creditors Bills payable dishonoured	29,000 7,500 20,000 2,500 18,000 25,000 10,500 1,500 800 300

 

18. From the following information you are required to ascertain

[a] cost of sales    [b] Closing inventory as per CPP method,

when the firm follows LIFO method for inventory valuation.

Inventory on  1/4/1996                                  Rs.1,20,000

Purchases during   1996 – 97                         Rs.72,000

Inventory on  31/3/1997                                Rs.1,80,000

The firm has decided to adopt retail price index which was as follows:

On 1/4/1996 = 100;   on 31/3/1997 = 140;     Average during 1996 – 97 =125

 

PART – C

 

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

 

19. Raja maintains his books under Single Entry system . From the following information prepare Trading

Profit and Loss A/c for the year ending 31.12.1991 and also Balance sheet as on that date.

Cash in hand on 01.01.1991 was Rs.4,250.

Asset and Liabilities

1.1.1991        31.12.1991

Debtors                                                                  16,300            21,250

Stock                                                                        8,330             11,220

Furniture                                                                     850                  850

Creditors                                                                  5,100               3,780

 

Other transactions:

Cash received from debtors       52,680              Cash sales                            1,275

Cash paid to creditors                37,400              Cash Purchases                   4,250

Salaries                                       10,200               Discount received                  595

Rent & Rates                               1,275                Discount allowed                  255

Other expenses                            1,530               Returns inward                      850

Drawings                                     2,550                Returns outward                   680

Additional capital                        1,700               Bad debts                               170

Adjustments:

 

Write off depreciation @5% on furniture.  Provide doubtful debts @ 1%  on debtors.

 

20. Kevin purchased a truck for Rs.1,60,000 from Pranesh on 1.1.93 payment to be made Rs.40,000

down,Rs.46,000 at the end of first year, Rs.44,000 at the end of second year and Rs.42,000 at the end

of third year. Interest was charged at 5% and Kevin depreciates the truck at 10% per annum on written

down method.

Kevin, after having paid down payment and first installment at the end of first year, could not pay

second installment. The seller took possession of the truck and after spending Rs.4,000 on repairs of

the asset, sold it away for Rs.91,500.

Give journal entries and ledger accounts in the books of both parties.

 

21. From the following trial balance as on 31.12.2000 prepare Trading, Profit and Loss Account and a

Balance Sheet as on that date.

 

Particulars	Debit  Rs.	Credit Rs.
Stock as on 01.01.2000 Cash in hand Drawings Rent Machinery Tax Provision for bad debts Bad debts Capital Interest General Expenses Bank overdraft Purchases Debtors Sales Creditors Sales return Purchase return	5,840 192 2,840 480 3,800 600   888     1,760   41,448 16,800     840	420   17,000 320   960     47,624 8,000   1,164
	75,488	75,488

 

Adjustments:

 

1. Depreciation on machinery 10% p.a
2. Rent outstanding Rs.500
3. Tax prepaid Rs.100
4. Provision for bad debts is to be increased to 5% on debtors
5. Closing stock Rs.3,500.
6. Discuss the Social Responsibility Accounting in detail.

 

 

 

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