Board Paper Solutions for KARNATAKA Class 12-commerce ACCOUNTANCY Board Paper 2008 Set 1

Question 1
What is statement of affairs? VIEW SOLUTION

Question 2
State any two rules to be followed in the absence of partnership deed. VIEW SOLUTION

Question 3
Mention any two factors which determine the goodwill of a partnership firm. VIEW SOLUTION

Question 4
Give the journal entry to close partner’s loan account on dissolution of firm. VIEW SOLUTION

Question 5
What is issue of shares at a premium? Give an example. VIEW SOLUTION

Question 6
Under what heading do you show the following in Company’s Balance Sheet?
(a) Forfeited Shares Account
(b) Preliminary Expenses. VIEW SOLUTION

Question 7
State any two causes of depreciation. VIEW SOLUTION

Question 8
Bring out any two differences between Receipts and Payments account and Income and Expenditure account. VIEW SOLUTION

Question 9
What is data processing? VIEW SOLUTION

Question 10
State any two features of computerised accounting. VIEW SOLUTION

Question 11
Vikas, a partner in a firm has withdrawn the following amounts during the year ended 31. 12. 2007:

Rs. 6,000 on 31. 03. 2007
Rs. 10,000 on 01. 07. 2007
Rs. 4,000 on 31. 10. 2007
Rs. 1,000 on 31. 12. 2007.

Calculate interest on drawings at 6% per annum under product method. VIEW SOLUTION

Question 12
Vidya and Vani were partners sharing profits and losses in the ratio of 3: 2. They admit Vijaya as a new partner. The new profit sharing is agreed to be 4: 3: 2.

Calculate the sacrifice ratio of the old partners. VIEW SOLUTION

Question 13

Asha, Usha and Nisha were partners in a firm sharing profits and losses in the ratio of 2: 2: 1. On 31. 12. 2006 their Balance Sheet is as follows:

Liabilities		Amount (Rs)	Assets	Amount (Rs)
Creditors		20,000	Cash at Bank	10,000
Reserve fund		10,000	Debtors	30,000
Bills Payable		10,000	Stock	20,000
Capital:			Furniture	10,000
Asha	40,000		Buildings	40,000
Usha	20,000
Nisha	10,000	70,000
		1,10,000		1,10,000

Usha died on 30. 04. 2007. Usha’s executors entitled to claim the following:

(i) Her capital as on the date of last Balance Sheet

(ii) Her share of Reserve Fund

(iii) Salary Rs. 500 per month

(iv) Her share of goodwill. Firm’s goodwill was valued at Rs. 20,000.

(v) Her share of profit upto the date of death on the basis of previous year’s profit which was Rs. 24,000.

Prepare Usha’s Capital Account and ascertain the amount payable to her executors. VIEW SOLUTION

Question 14
The Laxmi Company Ltd. issued 10,000 equity shares of Rs. 10 each. The amount payable was as follows:

On application Rs. 2
On allotment Rs. 3
On 1st & Final Call Rs. 5

All the shares were subscribed and all the money received except the 1st & Final Call on 200 shares.

Give Journal entries for issue of shares in the books of the Company. VIEW SOLUTION

Question 15
Briefly explain six disadvantages of Computerised Accounting. VIEW SOLUTION

Question 16

Mr. Vivek a retail trader has kept his books of accounts under single entry system. The following information is available from his books:

Particulars	01. 01. 2007 (Rs)	31. 12. 2007 (Rs)
Bank Balance	15,000	—
Stock in trade	20,000	30,000
Debtors	25,000	35,000
Creditors	30,000	40,000
Investments	10,000	20,000
Furniture	15,000	15,000
Building	40,000	40,000
Motor Vehicle (01. 07. 2007)	–	20,000
Bank overdraft	–	10,000

During the year, he withdrew Rs. 15,000 cash and goods worth Rs. 5,000 for his household purpose.

Adjustments:
(i) Write off bad debts Rs. 1,000 and maintain R.D.D. at 5% on debtors.
(ii) Depreciate Furniture and Motor vehicles at 10%.
(iii) Appreciate Building at 20%.
(iv) Interest on overdraft outstanding Rs. 500.
(v) Allow interest on capital at 8% p.a.

Prepare:
(a) Statement of affairs
(b) Statement showing profit or loss
(c) Revised statement of affairs as on 31. 12. 2007. VIEW SOLUTION

Question 17

Naveen, Nutan and Praveen were partners in a business sharing profits and losses in the ratio of 4 : 3 : 1 respectively.

Their Balance Sheet as on 31. 12. 2006 was as follows:

Balance Sheet as on 31. 12. 2006
Liabilities		Amount (Rs)	Assets	Amount (Rs)
Creditors		28,000	Cash at Bank	7,000
General Reserve		4,000	Bills Receivable	9,000
Bills Payable		20,000	Debtors	20,000
Capital:			Stock	30,000
Naveen	25,000		Machinery	24,000
Nutan	15,000		Furniture	10,000
Praveen	10,000	50,000	Profit & Loss A/c	2,000
		1,02,000		1,02,000

Nutan retired on the above date subject to the following terms:

(a) Machinery be depreciated by 5%.

(b) That stock be appreciated by 10%

(c) A bad debts reserve is to be created at 5% on debtors.

(d) The goodwill of the firm be valued at Rs. 8,000 and same should be shown in the Balance Sheet of the continuing partners.

(e) That the total capital of the new firm be fixed at Rs. 50,000 between Naveen and Praveen. The new profit sharing ratio of the remaining partners was agreed at 6: 4. The capital adjustments are to be made in cash.

Prepare:

(i) Revaluation Account

(ii) Partner’s Capital Accounts

(iii) Balance Sheet of Continuing Partners.

VIEW SOLUTION

Question 18

Shruti, Shilpa and Shreya were partners in a firm, sharing profits and losses in the ratio of 2 : 2 : 1. Their Balance Sheet on the date of dissolution was as follows:

Balance Sheet as on 31. 12. 2006
Liabilities		Amount (Rs)	Assets	Amount (Rs)
Creditors		30,000	Cash at Bank	6,000
Bills Payable		20,000	Debtors	30,000
Shreya’s loan		8,000	Stock	30,000
General Reserve		10,000	Furniture	22,000
Capital:			Machinery	20,000
Shruti	40,000		Building	50,000
Shilpa	30,000
Shreya	20,000	90,000
		1,58,000		1,58,000

The assets realised as follows:
(a) Debtors realised 10% less than the book value, the stock realised 15% more than the book value, building realised Rs. 60,000.
(b) The furniture was taken over by Shruti at Rs. 20,000.
(c) The machinery was taken over by Shilpa at Rs. 15,000.
(d) Creditors and bills payable were paid off at a discount of 5%.
(e) Cost of dissolution amounted to Rs. 1,500.

Prepare:
(i) Realisation Account
(ii) Partner’s Capital Accounts
(iii) Bank Account. VIEW SOLUTION

Question 19
(i) On 01. 01. 2002, a firm bought Machine X costing Rs. 28,000 and spent Rs. 2,000 for its installation.
(ii) Machine Y was purchased on 01. 07. 2003 for Rs. 40,000.
(iii) Machine X was sold on 30. 04. 2004 for Rs. 23,000.

Depreciation is to be charged at 10% per annum under Diminishing Balance Method.

Show (i) Machinery Account and (ii) Depreciation Account for 4 years ending on 31. 12. 2005. VIEW SOLUTION

Question 20

The following is the Balance Sheet of Public Library, Mysore, as on 01. 01. 2006 was as follows:

Balance Sheet as on 01. 01. 2006
Liabilities	Amount (Rs)	Assets	Amount (Rs)
Outstanding Rent	200	Cash in hand	1,400
Capital fund	23,800	Books	14,000
		Furniture	8,000
		Outstanding Subscription	600
	24,000		24,000

Receipts and Payments Account for the year ending 31. 12. 2006
Receipts	Amount (Rs)	Payments	Amount (Rs)
To Cash Balance	1,400	By Rent	2,400
To Subscriptions	12,000	By Printing & Stationery	1,200
To Entrance Fees	2,000	By Office Expenses	2,800
To Donations	4,000	To Books bought (01. 07. 2006)	10,000
To Sale of old papers	1,000	By Investment in Securities	2,000
To Sundry receipts	600	By Closing Balance	2,600
	21,000		21,000

Adjustments:
(i) Outstanding rent on 31. 12. 2006 was Rs. 300.
(ii) Subscriptions outstanding for the year 2006 amounted to Rs. 400 and Received in advance for the year 2007 was Rs. 800.
(iii) Half of Entrance fees and entire donations are to be capitalised.
(iv) Depreciation 10% per annum on Books and 5% per annum on Furniture is to be calculated.

Prepare Income and Expenditure Account for the year ending 31. 12. 2006 and also Balance Sheet as on that date. VIEW SOLUTION

Question 21

From the following Trial Balance of the Arunodaya Company Ltd. Prepare company final accounts as on 31. 03. 2007 in the prescribed form:

Trial Balance as on 31. 03. 2007
Particulars	Debit Amount (Rs)	Credit Amount (Rs)
Called up Capital (20,000 shares of Rs. 5 each)	-	1,00,000
Calls-in-arrears	4,000	-
Stock on 01. 04. 2006	34,000	-
Purchases and Sales	1,05,000	2,08,000
Returns	8,000	5,000
Freight	6,000	-
Salaries	15,000	-
Director's fees	9,800	-
Preliminary expenses	12,000	-
Debtors and Creditors	24,000	28,000
Furniture	20,000	-
Building	50,000	-
Goodwill	64,000	-
Investments	34,000	-
Interest on Investments	-	3,000
P & L Appropriation A/c	-	20,000
Reserve Fund	-	30,000
Bad debts	3,200	-
Cash at Bank	35,000	-
10% Debentures	-	56,000
Dividend	26,000	-
	4,50,000	4,50,000

Adjustments:
(a) Closing stock was valued at Rs. 30,000.
(b) Transfer Rs. 5,000 to Reserve Fund.
(c) Half of Preliminary expenses should be written off.
(d) Provide for outstanding debenture Interest for full year.
(e) Provide for Reserve for doubtful debts at 5%. VIEW SOLUTION

Question 22
Prepare Capital Accounts of two partners under Fluctuating Capital System with five imaginary figures. VIEW SOLUTION

Question 23
Prepare a Revaluation Account with five imaginary figures. VIEW SOLUTION

Question 24

Classify the following Receipts into Capital and Revenue:
(a) Life membership fees
(b) Sale of old sports materials
(c) Subscriptions
(d) Tuition fees
(e) Prize amount Rs. 1 lakh received from Lottery. VIEW SOLUTION

Board Paper of Class 12-Commerce 2008 Accountancy (SET 1) - Solutions