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# Board Paper of Class 12-Commerce 2015 Accountancy Delhi(SET 2) - Solutions

General Instructions:
1) This question paper contains two parts A and B.
2) Part A is compulsory for all.
3) Part B has two options-Financial statement Analysis and Computerised Accounting.
4) Attempt only one option of Part B.
5) All parts of a question should be attempted at one place.

Section A
i. This section consists of 17 questions.
ii. All the questions are compulsory.
iii. Question Nos. 1 to 6 are very short-answer questions carrying 1 mark each.
iv. Question Nos. 7 to 10 carry 3 marks each.
v. Question Nos. 11 and 12 carry 4 marks each.
vi. Question Nos. 13 to 15 carry 6 marks each.
vii. Question Nos. 16 and 17 carry 8 marks each.

Section B
i. This section consists of 6 questions.
ii. All questions are compulsory
iii. Question Nos. 18 and 19 are very short-answer questions carrying 1 mark each.
iv. Question Nos. 20 to 22 carry 4 marks.
v. Question No. 23 carries 6 marks.

• Question 1

Joy Ltd. issued 1,00,000 equity shares of Rs 10 each. The amount was payable as follows :

On application − Rs 3 per share
On allotment − Rs 4 per share.
On 1st and final call − balance
Applications for 95,000 shares were received and shares were allotted to all the applicants. Sonam to whom 500 shares were allotted failed to pay allotment money and Gautam paid his entire amount due including the amount due on first and final call on the 750 shares allotted to him along with allotment. The amount received on allotment was

(a) Rs 3,80,000
(b) Rs 3,78,000
(c) Rs 3,80,250
(d) Rs 4,00,250

VIEW SOLUTION

• Question 2
Give the meaning of forfeiture of shares. VIEW SOLUTION

• Question 3

Kumar, Verma and Naresh were partners in a firm sharing profit & loss in the ratio of 3 : 2 : 2. On 23rd January, 2015 Verma died. Verma's share of profit till the date of his death was calculated at Rs 2,350.
Pass necessary journal entry for the same in the books of the firm.

VIEW SOLUTION

• Question 4
On the retirement of Hari from the firm of 'Hari, Ram and Sharma' the balance-sheet showed a debit balance of Rs 12,000 in the profit and loss account. For calculating the amount payable to Hari this balance will be transferred
(a) to the credit of the capital accounts of Hari, Ram and Sharma equally
(b) to the debit of the capital accounts of Hari, Ram and Sharma equally
(c) to the debit of the capital accounts of Ram and Sharma equally
(d) to the credit of the capital accounts of Ram and Sharma equally VIEW SOLUTION

• Question 5
A, B, C and D were partners in a firm sharing profits in the ratio of 4 : 3 : 2 : 1. On 1-1-2015 they admitted E as a new partner for $\frac{1}{10}$ share in the profits. E brought Rs 10,000 for his share of goodwill premium which was correctly recorded in the books by the accountant. The accountant showed goodwill at Rs 1,00,000 in the books. Was the accountant correct in doing so? Give reason in support of your answer. VIEW SOLUTION

• Question 6
In the absence of partnership deed the profits of a firm are divided among the partners :

(a) In the ratio of capital
(b) Equally
(c) In the ratio of time devoted for the firm's business
(d) According to the managerial abilities of the partners VIEW SOLUTION

• Question 7

State any three purposes other than 'buy back of shares' for which securities premium can be utilized.

VIEW SOLUTION

• Question 8

On 1-4-2013 Jay and Vijay, entered into partnership for supplying laboratory equipments to government schools situated in remote and backward areas. They contributed capitals of Rs 80,000 and Rs 50,000 respectively and agreed to share the profits in the ratio 3 : 2. The partnership deed provided that interest on capital shall be allowed at 9% per annum. During the year the firm earned a profit of Rs 7,800.
Showing your calculations clearly, prepare 'Profit and Loss Appropriation Account' of Jay and Vijay for the year ended 31-3-2014.

VIEW SOLUTION

• Question 9

'Scooters India Ltd.' is registered with an authorized capital of Rs 50,00,000, divided into 5,00,000 shares of Rs 10 each. The company issued 1,00,000 shares for subscriptions to the public at par. The amount was payable as follows :

On application and allotment – Rs 3 per share.
On 1st call – Rs 2 per share.
On 2nd and final call – Rs 5 per share.

The issue was fully subscribed. All calls were made and were duly received except 2nd and final call on 1,000 shares held by Rohan. His shares were forfeited and afterwards re-issued at Rs 8 per share as fully paid up.

Present 'Share Capital' in the Balance Sheet of the company as per Schedule VI of the Companies Act, 1956. Also prepare Notes to accounts for the same.

VIEW SOLUTION

• Question 10

'Sangam Woollens Ltd.', Ludhiana, are the manufactures and exporters of woollen garments. The company decided to distribute free of cost woollen garments to 10 villages of Lahaul and Spiti District of Himachal Pradesh. The company also decided to employ 50 young persons from these village in its newly established factory. The company issued 40,000 equity shares of Rs 10 each and 1,000 9% debentures of Rs 100 each to the vendors for the purchase of machinery of Rs 5,00,000.
Pass necessary Journal Entries. Also identify any one value that the company wants to communicate to the society.

VIEW SOLUTION

• Question 11

Vikas, Gagan and Momita were partners in a firm sharing profits in the ratio of 2 : 2 : 1. The firm closes its books on 31st March every year. On 30th September, 2014 Momita died. According to the provisions of partnership deed the legal representatives of a deceased partner are entitled for the following in the event of his/her death :

(i) Capital as per the last Balance Sheet.
(ii) Interest on capital at 6% p.a. till the date of her death.
(iii) Her share of profit to the date of death calculated on the basis of average profits of last four years.
(iv) Her share of goodwill to be determined on the basis of three years purchase of the average profits of last four years. The profits of last four years were :

 Year Profit Rs 2010 – 2011 30,000 2011 – 2012 50,000 2012 – 2013 40,000 2013 – 2014 60,000

The balance in Momita's capital account on 31-3-2014 was Rs 60,000 and she had withdrawn Rs 10,000 till the date of her death. Interest on her drawings were Rs 300.
Prepare Momita's Capital Account to be presented to her executors.

VIEW SOLUTION

• Question 12

Kumar, Gupta and Kavita were partners in a firm sharing profits and losses equally. The firm was engaged in the storage and distribution of canned juice and its godowns were located at three different places in the city. Each godown was being managed individually by Kumar, Gupta and Kavita. Because of increase in business activities at the godown managed by Gupta, he had devote more time. Gupta demanded that his share in the profits of the firm be increased, to which Kumar and Kavita agreed. The new profit sharing ratio was agreed to be 1 : 2 : 1. For this purpose the goodwill of the firm was valued at two years purchase of the average profits of last five years. The profits of the last five years were as follows :

 Year Profit (Rs) I 4,00,000 II 4,80,000 III 7,33,000 IV (Loss) 33,000 V 2,20,000

You are required to :
(i) Calculate the goodwill of the firm.
(ii) Pass necessary Journal Entry for the treatment of goodwill on change in profit sharing ratio of Kumar, Gupta and Kavita,

VIEW SOLUTION

• Question 13

Bharat Ltd. had an authorized capital of Rs 20,00,000 divided into 2,00,000 equity shares of Rs 10 each. The company issued 1,00,000 shares and the dividend paid per share was Rs 2 for the year ended 31-3-2008. The management of the company decided to export its products to the neighbouring countries Nepal, Bhutan, Sri Lanka and Bangladesh. To meet the requirement of additional funds the financial manager of the company put up the following three alternatives before its Board of Directors :

(i) Issue 54,000 equity shares.
(ii) Obtain a loan from Import and Export Bank of India. The loan was available at 12% per annum interest.
(iii) To issue 9% Debentures at a discount of 10%.
After comparing the available alternatives the company decided on 1-4-2008 to issue 6,000 9% debentures of Rs 100 each at a discount of 10%. These debentures were redeemable in four instalments starting from the end of third year. The amount of debentures to be redeemed at the end of third, fourth, fifth and sixth year was as follows :

 Year Profit Rs III 1,00,000 IV 1,00,000 V 2,00,000 VI 2,00,000

Prepare 9% Debentures Account for the year 2008-09 to 2013-14.

VIEW SOLUTION

• Question 14

Bora, Singh and Ibrahim were partners in a firm sharing profits in the ratio of 5 : 3 : 1. On 2-3-2015 their firm was dissolved. The assets were realized and the liabilities were paid off. Given below are the Realisation Account, Partners' Capital Account and Bank Account of the firm. The accountant of the firm left a few amounts unposted in these accounts. You are required to complete these accounts by posting the correct amounts.

 Realisation Account Dr. Cr. Particulars Amount Rs Particulars Amount Rs To Stock 10,000 By Provision of bad debts 5,000 To Debtors 25,000 By Sundry Creditors 16,600 To Plant and Machinery 40,000 By Bills Payable 3,400 To Bank: By Mortgage Loan 15,000 Sundry Creditors 16,000 By Bank-assets realized : 30,600 Bills Payable 3,400 Stock 6,700 Mortgage Loan 15,000 34,400 Debtors 12,500 To Bank (Outstanding repairs) 400 Plant & Machinery 36,000 55,200 To Bank (Exp.) 620 By Bank-unrecorded assets realized 6,220 By ________ – 1,10,420 1,10,420

 Capital Accounts Dr. Cr. Particulars Bora Rs Singh Rs Ibrahim Rs Particulars Bora Rs Singh Rs Ibrahim Rs – – – – By Balance b/d 22,000 18,000 10,000 – – – – By General Reserve 2,500 1,500 500 24,500 19,500 10,500 24,500 19,500 10,500

 Bank Account Dr. Cr. Particulars Amount Rs Particulars Amount Rs To Balance b/d 19,500 By Relaisation (liabilities) 34,400 To Realisation (assets realized) 55,200 By Realisation (unrecorded liabilities) 400 ________________ ____ By ____________ ____ By ____________ ____ 80,920 80,920
VIEW SOLUTION

• Question 15

On 1-4-2010 Sahil and Charu entered into partnership for sharing profits in the ratio of 4 : 3. They admitted Tanu as a new partner on 1-4-2012 for $\frac{1}{5}\mathrm{th}$ share which she acquired equally from Sahil and Charu. Sahil, Charu and Tanu earned profits at a higher rate than the normal rate of return for the year ended 31-3-2013. Therefore, they decided to expand their business. To meet the requirements of additional capital they admitted Puneet as a new partner on 1-4-2013 for $\frac{1}{7}\mathrm{th}$ share in profits which he acquired from Sahil and Charu in 7 : 3 ratio.
Calculate:
(i) New profit sharing ratio of Sahil, Charu and Tanu for the year 2012-13.
(ii) New profit sharing ratio of Sahil, Charu, Tanu and Puneet on Puneet's admission.

VIEW SOLUTION

• Question 16

'Amrit Dhara Ltd.' invited applications for issuing 80,000 equity shares of Rs 10 each.
The amount was payable as follows :
On application and allotment – Rs 2 per share.
On first call – Rs 4 per share.
On second and final call – the balance.

Applications for 1,00,000 shares were received. Shares were allotted on pro-rate basis to all the applicants. Excess money received with applications was adjusted towards sums due on first call. Manohar who had applied for 2,000 shares failed to pay the first call and his shares were immediately forfeited. Afterwards second and final call was made. Mahan who was allotted 2,400 shares failed to pay the second and final call. His shares were also forfeited. All the forfeited shares were re-issued at Rs 9 per share as fully paid up.

Pass necessary Journal Entries in the books of the company for the above transactions.

OR

'Sulabh Ltd.' invited applications for issuing 1,50,000 equity shares of Rs 10 each at a premium of Rs 3 per share. The amount was payable as follows :

On application – Rs 2 per share.
On allotment – Rs 6 per share (including premium)
On first and final call – the balance

Applications for 2,00,000 shares were received and shares were allotted on pro-rata basis to all the applicants. Excess money received with applications was adjusted towards sums due on allotment. Suman who had applied for 2,000 shares failed to pay the allotment and call money. Raman failed to pay first and final call on his 500 shares. Shares of both Suman and Raman were forfeited after the final call was made.
The forfeited shares were re-issued for Rs 12 per share as fully paid up.

Pass necessary Journal Entries for the above transactions in the books of the company.

VIEW SOLUTION

• Question 17

Charu and Harsha were partners in a firm sharing profits in the ratio of 3 : 2. On 1-4-2014 their Balance Sheet was as follows :

 Balance Sheet of Charu and Harsha as on 1-4-2014 Liabilities Amount Rs Assets Amount Rs Creditors 17,000 Cash 6,000 General Reserve 4,000 Debtors 15,000 Workmen Compensation Fund 9,000 Investments 20,000 Investment Fluctuation Fund 11,000 Plant 14,000 Provision for bad debts 2,000 Land and Building 38,000 Capitals : Charu 30,000 Harsha 20,000 50,000 93,000 93,000

On the above date Vaishali was admitted for 1/4th share in the profits of the firm on the following terms :

(a) Vaishali will bring Rs 20,000 for her capital and Rs 4,000 for her share of goodwill premium.
(b) All debtors were considered good.
(c) The market value of investments was Rs 15,000.
(d) There was a liability of Rs 6,000 for workmen compensation.
(e) Capital accounts of Charu and Harsha are to be adjusted on the basis of Vaishali's capital by opening current accounts.

Prepare Revaluation Account and Partners' Capital Accounts.

OR

Amit, Balan and Chander were partners in a firm sharing profits in the proportion of respectively. Chander retired on 1-4-2014. The Balance Sheet of the firm on the date of Chander's retirement was as follows :

 Balance Sheet of Amit, Balan and Chander as on 1-4-2014 Liabilities Amount Rs Assets Amount Rs Sundry Creditors 12,600 Bank 4,100 Provident Fund 3,000 Debtors 30,000 General Reserve 9,000 Less : Provision 1,000 29,000 Capitals : Stock 25,000 Amit 40,000 Investments 10,000 Balan 36,500 Patents 5,000 Chander 2,000 96,500 Machinery 48,000 1,21,100 1,21,100

It was agreed that :
(a) Goodwill will be valued at Rs 27,000.
(b) Depreciation of 10% was to be provided on machinery.
(c) Patents were to be reduced by 20%.
(d) Liability on account of Provident Fund was estimated at Rs 2,400.
(e) Chander took over investments for Rs 15,800.
(f) Amit and Balan decided to adjust their capitals in proportion of their profit sharing ratio by opening current accounts.

Prepare Revaluation Account and Partners' Capital Accounts on Chander's retirement.

VIEW SOLUTION

• Question 18
Which of the following transactions will not result into flow of cash :
(a) Issue of equity shares of Rs 1,00,000.
(b) Purchase of machinery of Rs 1,75,000.
(c) Redemption of 9% debentures Rs 3,50,000.
(d) Cash deposited into bank Rs 15,000. VIEW SOLUTION

• Question 19
While preparing the Cash Flow Statement of Alka Ltd. 'dividend paid' was shown as an operating activity by the accountant of the company. Was he correct in doing so?
Give reason. VIEW SOLUTION

• Question 20

Under which major heads the following items will be placed in the Balance Sheet of a company as per Schedule VI, Part I of the Companies Act, 1956?

(ii) Balances with banks
(iii) Term loans from bank
(iv) Goods-in-transit
(v) Loans repayable on demand
(vi) Computer software
(vii) Unpaid dividends and
(viii) Vehicles

VIEW SOLUTION

• Question 21

The motto of Yash Ltd., an advertising company is 'Service with Dignity'. Its management and work force is hard-working, honest and motivated. The net profit of the company doubled during the year ended 31-3-2014. Encouraged by its performance company decided to give one month extra salary to all its employees. Following is the Comparative Statement of Profit and Loss of the company for the years ended 31st March 2013 and 2014.

 Particulars Note No. 2012-13 Rs 2013-14 Rs Absolute Change Rs % Change Revenue from operations Less Employees benefit expenses Profit before tax Tax Rate 25% Profit after tax 10,00,000 6,00,000 4,00,000 1,00,000 3,00,000 15,00,000 7,00,000 8,00,000 2,00,000 6,00,000 5,00,000 1,00,000 4,00,000 1,00,000 3,00,000 50 16.67 100 100 100

(a) Calculate Net Profit Ratio for the years ending 31st March, 2013 and 2014.
(b) Identify any two values which Yash Ltd. is trying to propagate.

VIEW SOLUTION

• Question 22
From the following information related to Naveen Ltd. calculate (a) Return on Investment and (b) Total Assets to Debt Ratio.

Information : Fixed Assets Rs 75,00,000; Current Assets Rs 40,00,000; Current Liabilities Rs 27,00,000; 12% Debentures Rs 80,00,000 and Net Profit before Interest, Tax and Dividend Rs 14,50,000. VIEW SOLUTION

• Question 23

Following is the Balance Sheets of Thermal Power Ltd. as at 31-3-2014 :

 Particulars Note No. 2013-14 Rs 2012-13 Rs I. EQUITY AND LIABILITIES (1) Shareholders Funds (a) Share Capital 12,00,000 11,00,000 (b) Reserves and Surplus 1 3,00,000 2,00,000 (2) Non-Current Liabilities Long Term-Borrowings 2,40,000 1,70,000 (3) Current Liabilities (a) Trade Payables 1,79,000 2,04,000 (b) Short Term Provisions 50,000 77,000 Total 19,69,000 17,51,000 II. ASSETS (1) Non-current Assets (a) Fixed Assets (i) Tangible 2 10,70,000 8,50,000 (ii) Intangible 3 40,000 1,12,000 (2) Current Assets (a) Current-Investments 2,40,000 1,50,000 (b) Inventories 1,29,000 1,21,000 (c) Trade Receivables 1,70,000 1,43,000 (d) Cash and Cash-equivalents 3,20,000 3,75,000 Total 19,69,000 17,51,000

Notes to Accounts :

 S. No. Particulars 2013-14 Rs 2012-13 Rs 1. Reserves and Surplus Surplus (balance in statement of Profit and Loss) 3,00,000 2,00,000 2. Tangible Assets Machinery 12,70,000 10,00,000 Less : Accumulated Depreciation (2,00,000) (1,50,000) 3. Intangible Assets Goodwill 40,000 1,12,000

During the year a piece of machinery, costing Rs 24,000 on which accumulated depreciation was Rs 16,000, was sold for Rs 6,000.

Prepare Cash Flow Statement.

VIEW SOLUTION
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