12th Accountancy Paper Solutions Set 1 : CBSE All India Previous Year 2015

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 18 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 3 marks.
v. Question No. 23 carries 6 marks.

Q1 :

In the absence of Partnership Deed, interest on loan of a partner is allowed :
(i) at 8% per annum.
(ii) at 6% per annum.
(iii) no interest is allowed.
(iv) at 12% per annum.


Answer :

In absence of Partnership Deed, interest on loan of a partner is allowed at the rate of 6% per annum.
Hence, the correct answer is option (ii).

Q2 :

Geeta, Sunita and Anita were partners in a firm sharing profits in the ratio of 5 : 3 : 2. On 1.1.2015 they admitted Yogita as a new partner for 1/10th share in the profits. On Yogita's admission, the Profit and Loss Account of the firm was showing a debit balance of Rs 20,000 which was credited by the accountant of the firm to the capital accounts of Geeta, Sunita and Anita in their profit sharing ratio. Did the accountant give correct treatment ? Given reason in support of your answer.


Answer :

Here, the treatment of Profit and Loss A/c (Dr.) is incorrect. Because, debit balance of Profit and Loss A/c represents the loss to the firm. Therefore, at the time of admission of Yogita, it must be divided among the old partners i.e. Geeta, Sunita and Anita in their old profit sharing ratio i.e. 5 : 3 : 2. Thus, it should be debited and not credited to the capital accounts of Geeta, Sunita and Anita. 

Q3 :

On the death of a partner, his share in the profits of the firm till the date of his death is transferred to the :
(i) Debit of Profit and Loss Account.
(ii) Credit of Profit and Loss Account.
(iii) Debit of Profit and Loss Suspense Account
(iv) Credit of Profit and Loss Suspense Account


Answer :

On the death of a partner, his share in the profits of the firm till the date of his death is transferred to the debit of Profit and Loss Suspense Account.
Hence, the correct answer is option (iii).

Q4 :

Anant, Gulab and Khushbu were partners in a firm sharing profits in the ratio of 5 : 3 : 2. From 1.4.2014, they decided to share the profits equally. For this purpose the goodwill of the firm was valued at Rs 2,40,000.
Pass necessary journal entry for the treatment of goodwill on change in the profit sharing ratio of Anant, Gulab and Khushbu.


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Q5 :

Give the meaning of forfeiture of shares.


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Q6 :

Nirman Ltd. issued 50,000 equity shares of Rs 10 each. The amount was payable as follows :

On application − Rs 3 per share
On allotment − Rs 2 per share
On first and final call − The balance

Applications for 45,000 shares were received and shares were allotted to all the applicants. Pooja, to whom 500 shares were allotted, paid her entire share money at the time of allotment, whereas Kundan did not pay the first and final call on his 300 shares. The amount received at the time of making first and final call was :
(i) Rs 2,25,000
(ii) Rs 2,20,000
(iii) Rs 2,21,000
(iv) Rs 2,19,500


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Q7 :

Guru Ltd. invited applications for issuing 5,00,000 equity shares of Rs 10 each at a premium of Rs 5 per share. Because of favourable market conditions the issue was over-subscribed and applications for 15,00,000 shares were received.
Suggest the alternatives available to the Board of Directors for the allotment of shares.


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Q8 :

On 1.4.2013, Brij and Nandan entered into partnership to construct toilets in government girls schools in the remote areas of Uttarakhand. They contributed capitals of Rs 10,00,000 and Rs 15,00,000 respectively. Their profit sharing ratio was 2 : 3 and interest allowed on capital as provided in the Partnership Deed was 12% per annum. During the year ended 31.3.2014, the firm earned a profit of Rs 2,00,000.
Prepare Profit and Loss Appropriation Account of Brij and Nandan for the year ended 31.3.2014


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Q9 :

'Suvidha Ltd.' is registered with an authorised capital of Rs 10,00,00,000 divided into 10,00,000 equity shares of Rs 100 each. The company issued 1,00,000 shares for public subscription. A shareholder holding 100 shares, failed to pay the final call of Rs 20 per share. His shares were forfeited. The forfeited shares were re-issued at Rs 90 per share as fully paid up.
Present the 'Share Capital' in the Balance Sheet of the company as per Schedule VI Part I of the Companies Act, 1956, Also prepare 'Notes to Accounts'.


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Q10 :

'Good Blankets Ltd.' are the manufacturers of woollen blankets. Blankets of the company are exported to many countries. The company decided to distribute blankets free of cost to five villages of Kashmir Valley destroyed by the recent floods. It also decided to employ 100 young persons from these villages in their newly established factory at Solan in Himachal Pradesh. To meet the requirements of funds for starting its new factory, the company issued 50,000 equity shares of Rs 10 each and 2,000 8% debentures of  Rs 100 each to the vendors of machinery purchased for Rs 7,00,000.
Pass necessary journal entries for the above transactions in the books of the company. Also identify any one value which the company wants to communicate to the society.


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Q11 :

Arun, Varun and Karan were partners in a firm sharing profits in the ratio of 4 : 3 : 3. On 31.3.2014, their Balance Sheet was as follows :
 

Liabilities

Amount

Rs

Assets

Amount

Rs

Creditors

17,000

Cash

8,000

Bills Payable

12,000

Debtors

13,000

Karan”™s Loan

28,000

Bills Payable

9,000

Capitals :

 

Furniture

27,000

Arun

70,000

 

Machinery

1,25,000

Varun

68,000

1,38,000

Karan”™s Capital

13,000

 

1,95,000

 

1,95,000

 

 

 

 

On 30.9.2014, Karan died. The partnership Deed provided for the following to the executors of the deceased partner :
(a) His share in the goodwill of the firm calculated on the basis of three year's purchase of the average profits of the last four years. The profits of the last four years were Rs 1,90,000; Rs 1,70,000; Rs 1,80,000 and Rs 1,60,000 respectively.
(b) His share in the profits of the firm till the date of his death calculated on the basis of the average profits of the last four years.
(c) Interest @8% p.a. on the credit balance, if any, in his Capital Account.
(d) Interest on his loan @12% p.a.
Prepare Karan's Capital Account to be presented to his executors, assuming that his loan and interest on loan were transferred to his Capital Account.


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Q12 :

Prem, Param and Priya were partners in a firm. Their fixed capitals were Prem Rs 2,00,000; Param Rs 3,00,000 and Priya Rs 5,00,000. They were sharing profits in the ratio of their capitals. The firm was engaged in the sale of ready-to-eat food packets at three different locations in the city, each being managed by Prem, Param and Priya. The outlet managed by Prem was doing more business than the outlets managed by Param and Priya. Prem requested Param and Priya for a higher share in the profits of the firm which Param and Priya accepted. It was decided that the new profit sharing ratio will be 2 : 1 : 2 and its effect will be introduced retrospectively for the last four years. The profits of the last four years were Rs 2,00,000; Rs 3,50,000; Rs 4,75,000 and Rs 5,25,000 respectively.
Showing your calculations clearly, pass a necessary adjustment entry to give effect to the new agreement between Prem, Param and Priya.


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Q13 :

On 1.1.2008, Uday and Kaushal entered into partnership with fixed capitals of Rs 7,00,000 and Rs 3,00,000 respectively. They were doing good business and were interested in its expansion but could not do the same because of lack of capital. Therefore, to have more capital, they admitted Govind as a new partner on 1.1.2010. Govind brought Rs 10,00,000 as capital and the new profit sharing ratio decided was 3 : 2 : 5. On 1.1.2012, another new partner Hari was admitted with a capital of Rs 8,00,000 for 1/10th share in the profits, which he acquired equally from Uday, Kaushal and Govind. On 1.4.2014 Govind died and his share was taken over by Uday and Hari equally.
Calculate :
(i) The sacrificing ratio of Uday and Kaushal on Govind's admission.
(ii) New profit sharing ratio of Uday. Kaushal, Govind and Hari on Hari's admission.
(iii) New profit sharing ratio of Uday, Kaushal and Hari on Govind's death.


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Q14 :

'Ananya Ltd' had an authorized capital of Rs 10,00,00,000 divided into 10,00,000 equity shares of Rs 100 each. The company had already issued 2,00,000 shares. The dividend paid per share for the year ended 31.3.2007 was Rs 30. The management decided to export its products to African countries. To meet the requirements of additional funds, the finance manager put up the following three alternate proposals before the Board of Directors :
(i) Issue 47,500 equity shares at a premium of Rs 100 per share.
(ii) Obtain a long-term loan from bank which was available at 12% per annum.
(iii) Issue 9% debentures at a discount of 5%.
After evaluating these alternatives the company decided to issue 1,00,000, 9% debentures on 1.4.2008. The face value of each debenture was Rs 100. These debentures were redeemable in four instalments starting from the end of third year, which was as follows :

Year Amount
Rs
III 10,00,000
IV 20,00,000
V 30,00,000
VI 40,00,000

Prepare 9% debenture account from 1.4.2008 till all the debentures were redeemed.


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Q15 :

Mala, Neela and Kala were partners sharing profits in the ratio of 3 : 2 : 1. On 1.3.2015 their firm was dissolved. The assets were realized and liabilities were paid off. The accountant prepared Realisation Account, Partners' Capital Accounts and Cash Account, but forgot to post few amounts in these accounts.
You are required to complete these below given accounts by posting correct amounts.
 

Realisation Account
Dr.
Cr.
Particulars
Amount
Rs
Particulars
Amount
Rs
To Sundry Assets :
 
By Provision for bad debts
1,000
Machinery
10,000
 
By Sundry Creditors
15,000
Stock
21,000
 
By Sheela’s Loan
13,000
Debtors
20,000
 
By Repairs and Renewals Reserve
1,200
Prepaid Insurance
400
 
By Cash – Assets sold :
 
Investments
3,000
54,400
Machinery
8,000
 
To Mala’s Capital A/c
13,000
Stock
14,000
 
             – Sheela’s Loan
 
Debtors
16,000
38,000
To Cash – Creditors paid
15,000
By Mala’s Capital Investments
2,000
To Cash – Dishonoured bill paid
5,000
 
 
To Cash Expenses
800
……………..
………….
 
88,200
 
88,200
 
 
 
 

 

Capital Accounts
Dr.
Cr.
Particulars
Mala
Rs
Neela
Rs
Kala
Rs
Particulars
Mala
Rs
Neela
Rs
Kala
Rs
………….
………….
………….
………….
………….
………….
………….
………….
………….
………….
 
 
………….
………….
 
 
To Cash
12,000
9,000
 
By Cash
 
 
1,000
 
23,000
15,000
3,000
 
23,000
15,000
3,000

 

Cash Account
Dr.
Cr.
Particulars
Amount
Rs
Particulars
Amount
Rs
To Balance b/d
2,800
By Realisation A/c
15,000
To Realisation A/c
38,000
                 – Creditors paid
 
                  – Sale of assets
 
 
 
To Kala’s Capital A/c
1,000
By Dishonoured bill
5,000
 
 
……………
………….
 
 
By Mala’s Capital A/c
12,000
 
 
By Neela’ s Capital A/c
9,000
 
41,800
 
41,800
 
 
 
 


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Q16 :

'BMY Ltd.' invited applications for issuing 1,00,000 equity shares of Rs 10 each at a premium of Rs 10 per share. The amount was payable as follows :
On application − Rs 10 per share (including Rs 5 premium)
On allotment − The balance
The issue was fully subscribed. A shareholder holding 300 shares paid the full share money with application. Another shareholder holding 200 shares failed to pay the allotment money. His shares were forfeited. Later on these shares were re-issued for Rs 4,000 as fully paid up.
Pass necessary journal entries for the above transaction in the books of BMY Ltd.
 

OR


'Blur Star Ltd.' was registered with an authorized capital of Rs 2,00,000 divided into 20,000 shares of Rs 10 each. 6,000 of these shares were issued to the vendor for building purchased. 8,000 shares were issued to the public and Rs 5 per share were called up as follows :
On application − Rs 2 per share
On allotment − Rs 1 per share
On first call − Balance of the called up amount
The amounts received on these shares were as follows :
On 6,000 shares − Full amount called
On 1,250 shares − Rs 3 per share
On 750 shares − Rs 2 per share
The directors forfeited 750 shares on which Rs 2 per share were received.
Pass necessary journal entries for the above transactions in the books of Blue Star Ltd.


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Q17 :

Om, Ram and Shanti were partners in a firm sharing profits in the ration of 3 : 2 : 1. On 1st April, 2014 their Balance Sheet was as follows :
 

Liabilities

Amount

Rs

Assets

Amount

Rs

Capital Accounts :

 

Land and Building

3,64,000

Om

3,58,000

 

Plant and Machinery

2,95,000

Ram

3,00,000

 

Furniture

2,33,000

Shanti

2,62,000

9,20,000

Bills Receivable

38,000

General Reserve

48,000

Sundry Debtors

90,000

Creditors

1,60,000

Stock

1,11,000

Bills Payable

90,000

Bank

87,000

 

12,18,000

 

12,18,000

 

 

 

 

On the above date Hanuman was admitted on the following terms:
(i) He will bring Rs 1,00,000 for his capital and will get 1/10th share in the profits.
(ii) He will bring necessary cash for his share of goodwill premium. The goodwill of the firm was valued at Rs 3,00,000.
(iii) A liability of Rs 18,000 will be created against bills receivables discounted.
(iv) The value of stock and furniture will be reduced by 20%.
(v) The value of land and building will be increased by 10%.
(vi) Capital accounts of the partners will be adjusted on the basis of Hanuman's capital in their profit sharing ratio by opening current accounts.
Prepare Revaluation Account and Partner's Capital Accounts.

OR


Xavier, Yusuf and Zaman were partners in a firm sharing profits in the ratio of 4 : 3 : 2. On 1.4.2014 their Balance sheet was as follows :

Liabilities

Amount

Rs

Assets

Amount

Rs

Sundry Creditors

41,400

Cash at Bank

33,000

Capital Accounts :

 

Sundry Debtors

30,450

 

Xavier

1,20,000

 

 Less: Prov. for Bad Debts

1,050

29,400

Yusuf

90,000

 

Stock

48,000

Zaman

60,000

2,70,000

Plant and Machinery

51,000

 

 

Land and Building

1,50,000

 

3,11,400

 

3,11,400

 

 

 

 

Yusuf had been suffering from ill health and thus gave notice of retirement from the firm. An agreement was, therefore, entered into as on 1.4.2014, the terms of which were as follows:
(i) That land and building be appreciated by 10%
(ii) The provision for bad debts is no longer necessary.
(iii) That stock be appreciated by 20%
(iv) That goodwill of the firm be fixed at Rs 54,000. Yusuf share of the same be adjusted into Xavier's and Zamna's Capital Accounts, who are going to share future profits in the ratio of 2 : 1.
(v) The entire capital of the newly constituted firm be readjusted by bringing in or paying necessary cash so that the future capitals of Xavier and Zaman will be in their profit sharing ratio.
Prepare Revaluation Account and Partner's Capital Accounts.


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Q18 :

Which of the following transactions will result into flow of cash ?
(i) Cash withdrawn from bank Rs 20,000.
(ii) issued Rs 20,000, 9% debentures for the vendors of machinery.
(iii) Received Rs 19,000 from debtors.
(iv) Deposited cheques of Rs 10,000 into bank.


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Q19 :

The accountant of Manav Ltd. while preparing Cash Flow Statement added depreciation provided on fixed assets to net profit for calculating cash flow from operating activities. Was he correct in doing so ? Give reason.


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Q20 :

Under which major headings and sub-headings will the following items be shown in the Balance Sheet of a company as per schedule VI Part I of the Companies Act, 1956 :
(i) Net loss as shown by Statement of Profit and Loss.
(ii) Capital redemption reserve.
(iii) Bonds.
(iv) Loans repayable on demand.
(v) Unpaid dividend.
(vi) Buildings.
(vii) Trademarks.
(viii) Raw materials.


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Q21 :

The Current Ratio of a company is 2.1 : 1.2. State with reasons which of the following transactions will increase, decrease or not change the ratio :
(i) Redeemed 9% debentures of Rs 1,00,000 at a premium of 10%.
(ii) Received from debtors Rs 17,000.
(iii) Issued Rs 2,00,000 equity shares to the vendors of machinery.
(iv) Accepted bills of exchange drawn by the creditors Rs 7,000.


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Q22 :

The motto of 'Pharma Ltd', a company engaged in the manufacturing of low-cost generic medicines, is 'Healthy India'. Its management and employees are hardworking, honest and motivated. The net profit of the company doubled during the year ended 31-3-2014. Encouraged by its performance, the company decided to pay bonus to all employees at double the rate than last year.
Following is the Comparative Statement of Profit and Loss of the company for the years ended 31-3-2013 and 31-3-2014.
 

Pharma Ltd.
Comparative Statement of Profit and Loss
Particulars Note
No.
2012 – 13
Rs
2013 – 14
Rs
Absolute
Charge
Rs
%
Change
Revenue from operations   20,00,000 30,00,000 10,00,000 50
Less : Employees benefit expenses   12,00,000 14,00,000 2,00,000 16-67
Profit before tax   8,00,000 16,00,000 8,00,000 100
Tax at 25% rate   2,00,000 4,00,000 2,00,000 100
Profit after tax   6,00,000 12,00,000 6,00,000 100


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


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Q23 :

Following is the Balance Sheets of Solar Power Ltd. as at 31.3.2014 :

Solar Power Ltd.
Balance Sheet
Particulars Note No. 31.3.2014 Rs 31.3.2013 Rs
I. Equity and Liabilities :
1. Shareholder's Funds :
     
(a) Share Capital
  24,00,000 22,00,000
(b) Reserves and Surplus
1 6,00,000 4,00,000
2. Non-Current Liabilities :
     
 Long Term-Borrowings
  4,80,000 3,40,000
3. Current Liabilities :
     
(a) Trade Payables
  3,58,000 4,08,000
(b) Short-Term Provisions
  1,00,000 1,54,000
Total   39,38,000 35,02,000
       
II. Assets :
1. Non-Current Assets :
     
(a) Fixed Assets :
     
(i) Tangible
2 21,40,000 17,00,000
(ii) Intangible
3 80,000 2,24,000
2. Current Assets :
     
(a) Current Investments
  4,80,000 3,00,000
(b) Inventories
  2,58,000 2,42,000
(c) Trade Receivables
  3,40,000 2,86,000
(d) Cash and Cash equivalents
  6,40,000 7,50,000
Total   39,38,000 35,02,000
       

Notes to Accounts

S. No. Particulars As on
31.3.2014
Rs
As on
31.3.2013
Rs
1. Reserves and Surplus    
  Surplus (balance in Statement of Profit and Loss) 6,00,000 4,00,000
2. Tangible Assets    
  Machinery 25,40,000 20,00,000
    Less : Accumulated Depreciation (4,00,000) (3,00,000)
3. Intangible Assets    
  Goodwill 80,000 2,24,000

Additional Information :

During the year a piece of machinery, costing Rs 48,000 on which accumulated depreciation was Rs 32,000, was sold for Rs 12,000.

Prepare Cash Flow Statement.


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12th Accountancy Paper Solutions Set 2 : CBSE All India Previous Year 2013 will be available online in PDF book soon. The solutions are absolutely Free. Soon you will be able to download the solutions.