NAME_______________________

ACCOUNTING & FINANCIAL

MANAGEMENT

MANIPAL
ACADEMY
OF
BANKING
WORK BOOK FOR FMSB



UNIT -1
Activity 1:
In your words write the meaning of accountancy and its importance in Banking sector:






Activity 2: Write the meaning of these Basic Accountancy Terms

Event: ____________________________________________________________
Transactions: ______________________________________________________
Proprietor: _________________________________________________________
Asset: ______________________________________________________________
Liability: ____________________________________________________________
Capital: ____________________________________________________________
Debtor: ____________________________________________________________
Creditor: ___________________________________________________________
Profit: _____________________________________________________________
Expenses: __________________________________________________________
Drawings: _________________________________________________________
Bad debts: __________________________________________________________
Drawings: ____________________________________________________________
Fixed asset: ____________________________________________________________
Current liability: _________________________________________________________



Activity 3: Match the following:


1
Building A Nominal Account
2 Interest Paid B Real Account
3 Goodwill C Nominal Account
4 Commision received D Real Account
5 Outstanding Salaries account E Personal Account


Activity 4: List of examples of accounts and the category of accounts:

Examples Category of accounts
Capital
Land
Patents
Creditors
Drawings
Cash
Sales
Purchases
Machinery
Discount allowed
Investments
Interest paid
Outstanding expenses
Prepaid Rent
Outstanding income
Carriage Inward
Carriage Outward
Interest received in advance


Activity 5: write the golden rules of accounting
Personal account:
Real account:
Nominal account:




Activity 6
Debit and Credit concepts

Identification of accounts: Identify the account(s) to be debited and credited for the following
transactions:

Transaction Debit Credit
1 Paid creditors
2 Paid insurance premium
3 Bought office supplies on credit
4 Paid rent
5 Paid rent for proprietors home
6 Bought equipment on part payment
7 Collected cash from customers for services
provided

8 paid dividend
9 Paid telephone rent
10 Paid interest charges
11 Paid creditors for office suppliers bought earlier
12 Paid assistants salary























UNIT-2
Journalizing:

1. Journalize the following transactions in the books of Tmt.Amutha as on Jaunary 2012
Jan 1 Tmt.Amutha commenced business with cash50000
Jan 2 Purchased goods for cash 10000
Jan5 Purchased goods from Mohan on credit 6000
Jan 7 Paid into Bank 5000
Jan 10 Purchased furniture 2000
Jan 20 Sold goods to Suresh on credit 5000

2. Journalize the following transactions of Mr.Moorthi
June (08) 3 Received cash from Ramkumar 60000
4 Purchased goods for cash 15000
11 Sold goods to Damodaran 22000
13 Paid to Ramkumar 40000
17 Received from Damodaran 20000
20 Bought furniture from Jagadeesan 5000
27 Paid rent 1000
30 aid salary 2500

3. Enter the following transactions in the Journal of Bhagwat and sons..
2006 Amount in Rs
January 1 Tarun started business with cash 1,00,000
January 2 Goods purchased for cash 20,000
January 4 Machinery Purchased from Vishnu 30,000
January 6 Rent paid in cash 10,000
January 8 Goods purchased on credit from Anil 25,000
January 10 Goods sold for cash 40,000
January 15 Goods sold on credit to Gurmeet 30,000
January 18 Salaries paid. 12,000
January 20 Cash withdrawn for personal use 5,000



4. Journalize the following transactions in the books of John for the month of October 2013.


June
2014
Particulars Rs.
1
st
John started business with cash 70,000
2
nd
Purchased furniture for cash 10,000
4
th
Purchased goods for cash 20,000
5
th
Bought goods from Rahim 25,000
7
th
Sold goods for cash 44,000
9
th
Sold goods to Mahesh 30,000
10
th
Paid cash to Ramesh 15,000
11
th
Received cash from Ramanath 10,000
18
th
Purchased goods from nil Kumar 12,000
20
th
Purchased computers on credit from Shivshankar 28,000
29th Paid salaries 7,000
30
th
Withdrew cash for personal use from the office 10,000
30
th
Paid wages 5,500

5. Pass journal entries in the books of Ms Lily
Jan 1. Commenced business with Cash 26000, Stock 2800 and Furniture 90000

Jan. 2 Goods purchased for cash 1 4,000
Jan. 3 Paid freight 500
Jan. 7 Goods sold to Manoj on credit 5,000
Jan. 8 Paid for stationery 2,000
Jan. 10 Paid for Rent 1,000
Jan. 13 Cash received from RaghuDas 16,400
Allowed him discount 600
Jan. 15 Paid Premium 4,200
Jan. 20 Paid to postage 1,000
Jan. 25 Paid for salaries 500
Jan. 30 Commission received 1,000









6. Mr Kumar has the following transactions in the month of April .Write journal entries for the
transactions
10
th
April : commenced business with Cash 25000 and Furniture 3000

11
th
April purchased goods from Veeru for Rs 20000
13
th
April purchased goods for Cash Rs 15000
14
th
April Purchased goods from Abhiram for cash Rs 9000
15
th
April bought goods from Shyam on credit Rs 12000
16
th
April sold goods worth Rs 15000 to Tarun
20
th
April Sold goods to Utsav for cash 6000
22
nd
April Returned goods to Veeru 3000
23
rd
April goods returned from Tarun Rs 1000
New concepts: Purchase Return and Sales Return

7. Pass journal entries in the books of Mr Ram for the month of January
11
th
Paid wages Rs 7000
15
th
Paid rent by cheque Rs 6000
17
th
Purchased stationary and paid by cheque Rs 8900
20
th
Received interest Rs 640
21
st
Withdrew from bank Rs 5600
22
nd
Received by cheque Rs 450
23
rd
Bought additional capital Rs 30000
24
th
Withdrew from bank for personal use Rs 4000
25
th
Received Rs. 9500 from Mahesh and allowed him a discount of Rs 500
26
th
Paid Laxman Rs 2300 in cash and received a discount of Rs 200







LEDGER
1. Journalise the following transactions of Mr.Ravi and post them in the ledger and balance the same.
June 1 Ravi invested Rs.5,00,000 cash in the business
3 Paid into Bank Rs.80,000

5 Purchased building for Rs.3,00,000
7 Purchased goods for Rs.70,000
10 Sold goods for Rs.80,000
15 With drew cash from bank Rs.10,000
25 Paid electric charges Rs.3,000
30 Paid Salary Rs. 15,000
2. Journalise the following transactions and post them in the ledger
January 1 Commenced business with cash 50000
January 3 Paid into bank 25000
January 5 Purchased furniture for cash 5000
January 8 Purchased goods and paid by cheque 15000
January 14 Purchased Goods from K. Murthy 35000
January 18 Cash Sales 32000
January 20 Sold Goods to Ashok on credit 28000
January 25 Paid cash to K. Murthy in full settlement 34200
January 28 Cash received from Ashok 20000
January 31 Paid Rent for the month 2000
January 31 Withdrew from bank for private use 2500











CASH BOOK
1. Prepare A Single Column Cash Based On The Transactions Below
Jan 1 Started business with cash ... Rs. 1,000
3 Purchased goods for cash ... Rs. 500
4 Sold goods ... Rs. 1,700

5 Cash received from Siva ... Rs. 200
12 Paid Balan ... Rs. 150
14 Bought furniture ... Rs. 200
15 Purchased goods from Kala on credit ... Rs. 2,000
20 Paid electric charges ... Rs. 225
24 Paid salaries ... Rs. 250
28 Received commission ... Rs. 75

2. Compile three column cash book of Mr.Sundar from the following transactions for the August
1.Sundar started business with cash Rs.2,00,000
2 Deposited into Bank Rs.50,000.
4 Cash purchases Rs.5,000.
5 Purchases by cheque Rs.6,000.
6 Goods sold to Nathan on credit Rs. 5,000.
8 Received cheque from Mano Rs.490, Discount allowed Rs.10.
10 Paid carriage Rs.1,000.
12 Withdrew from Bank for office use Rs.10,000.
15 Paid to Sundari Rs.4,960, Discount allowed by her Rs.40.
20 Received a cheque for Rs.4950 from Nathan in full settlement of his account, which is
deposited into Bank.




3. Prepare a cash book with cash, bank and discount columns from the transactions given below:
Jan 1 Cash Balance Rs.75,000.
Bank Balance Rs. 45,000.
3 Deposited into bank Rs.60,000.
4 Bought furniture and paid by cheque Rs.7,500

5 Paid for repair Rs.650.
6 Goods purchased and paid by cheque Rs.12,500.
10 Received a cheque for Rs.21,000 from Chandran and allowed him discount Rs.200.
13 Gave Muthu a cheque for Rs.11,500 and received a discount of Rs.150.
20 Withdrew from bank for office use Rs.2,500.
28 Withdrew from bank for personal use Rs.500.
4. Enter the following transactions in Mural's cash book with column for discount, cash & bank for the
year 2012
April1 Cash balance Rs.60000.
o Bank balance Rs.10,500.
4 Received Rs.2,000 from Manoj in cash. Allowed him discount of Rs.100.
7 Cash sales Rs.2,000.
10 Furniture purchased Rs.800 by cheque.
12 Paid rent by cheque Rs.1,500.
15 Paid Rs1250 to Karthikeyan by cheque.
18 Cash sales Rs.15,000.
20 Paid packing charges Rs.500.
24 Paid Murugan Rs.4,000. Discount allow by him Rs.50.
26 Paid into bank Rs.5,000.





TRIAL BALANCE
1. Prepare a trial balance as at March 31, 2012 based on the following balances:

ACCOUNT TITLE AMOUNT(Rs)
Capital 1,00,000
Drawings 16000

Machinery 20,000
Sales 2,00,000
Purchases 2,10,000
Sales return 20,000
Purchase return 30,000
Wages 40,000
Goodwill 60,000
Interest received 15,000
Discount allowed 6,000
Bank overdraft 22,000
Bank loan 90,000
Debtors 75000
Creditors 60,000
Cash 54000
Stock on 1
st
April 2011 16000


2. The following balances are extracted from the books of Mr.Raj .Prepare Trial Balance as on 30.6.2013.
Capital 4,70,200
Machinery 1,58,800
Cash in hand 6,000
Sundry Debtors 48,000
Building 3,20,000
Repairs 5,400
Stock 33,000
Insurance premium 3,300
Sundry creditors 26,000
Sales 2,90,000
Commission paid 750
Telephone charges 6,450
Rent & Taxes 6,300
Furniture 11,000
Purchases 1,65,000

Discount earned 1,100
Salaries 70,600
Loan from Mohammed 51,000
Discount allowed 650
Bank overdraft 5,900
Drawings 5,000
Bills receivable 8,600
Bad debts 1,350
Bills payable 6,000

3.Prepare Trial Balance as on 31.12.2000 from the following balances of Mr. Vasu

Capital Rs. 3,40,000
Purchases Rs. 94,000
Creditors Rs. 13,000
Sales Returns Rs. 3,400
Drawings Rs. 4,000
Purchases Return Rs. 2,400
Salaries Rs. 38,200
Carriage inwards Rs. 1,400
Bill Receivable Rs. 5,800
Printing & Stationery Rs. 5,000
Bills Payable Rs. 7,000
Stock Rs. 29,900
Debtors Rs.16,000

Machinery Rs. 50,000
Sales Rs. 1,44,000
Wages Rs. 5,000
Insurance Rs. 2,200
Rent Rs. 1,600
Land Rs. 2,50,000
Interest received Rs. 1,700
Commission received Rs. 800
Electricity charges Rs. 2,400


















4. The following balances extracted from the books of a trader, prepareTrial Balance as on 31st March, 2011

Cash in hand 4200
Cash at Bank 16800
Bills Receivable 18000
Bills payable 16000
Sundry debtors 24600

Sundry creditors 32400
Capital 50000
Drawings 18000
Sales 105000
Purchases 75000
Carriage Inward 2700
Salaries 12000
Advertisement 2400
Insurance 1600
Furniture 7500
Stock 18600
Office Rent 2000


























UNIT-3 BANK RECONCILIATION STATEMENT

1. XYZ Ltd. maintains a current account with the federal bank. As on 31
st
March 2006, the bank column of
its cashbook showed a debit balance of Rs, 20,000. However, the bank statement showed a different
balance as on that date. The following are the reasons for such a difference:
Cheque deposited but not yet credited by the bank- 4,000
Cheque issued but not yet presented -9,000
Bank charges -1,000
Cheques received by the bank directly -6,000
Insurance premium paid by the bank as per standing instructions not yet intimated -3,000

2. Make a bank reconciliation statement for Mr Mars ltd on December 31, 2013 to find out the balance as
per pass book
Balance as per cash book Rs.15000
Cheques deposited but not yet collected by the bank Rs.10000.
Bank charges debited in the pass book Rs. 500
Cheque issued to Mr. Mahesh has not yet been presented for payment Rs. 25,000.
Interest allowed by the bank Rs. 1000.
Insurance premium directly paid by the bank as per standing instructions Rs. 5000.
Interest allowed by the bank Rs 2500

3. X Ltd. maintains a current account with the Federal bank . As on 31
st
March 2012, the bank column of
its cashbook showed a debit balance of Rs, 25000. However, the bank statement showed a different
balance as on that date. The following are the reasons for such a difference:
Cheque deposited but not yet credited by the bank 3,000
Cheque issued but not yet presented 2,000
Bank charges debited 3,000
Cheques received by the bank directly 7,000
Insurance premium paid by the bank as per standing
instructions not yet intimated 2,000

Prepare bank reconciliation statement and find out the balance as per the bank statement













UNIT -4 DEPERICATION ACCOUNTING

1. Jessica & Co purchased a fixed asset on 01.04.2002 for `5,00,000. Depreciation is
to be provided at the rate of 15% annually, according to Straight Line Method. The
books are closed on 31st March every year. Prepare Fixed Asset account for the
first three years.
2. Bedi Brothers purchased a machine on 01.04.2000 for `5,00,000. On The firm
charges depreciation at the rate of 15% per annum on Straight Line Method.
The books are closed on 31st March every year. Prepare Machinery account for
three years

3. M/s. Shankar & Co. purchased a Machinery on 1.1.2002 for Rs.10,00,000. The
firm writes off depreciation at 10% on the original cost every year. The books
are closed on 31st March every year, Prepare Machinery account and
Depreciation account for the first three years

4. A firm acquired a machine on 1
st
January 2006 at a cost of Rs 30000. the firm
writes off depreciation at 10% per annum on the diminishing balance . Show
the machinery account and depreciation account for 3 years.


5. A manufacturing concern whose books are closed on 31
st
December purchased
machinery for Rs 40000 on 1.1.2006. additional machinery was purchased for
Rs 20000 on 1.7.2007 and from Rs 10000 on 1.4.2008. prepare a machinery
account for 3 yrs writing off depreciation at 10%p.a on written down value
method

6. Rajesh bought a machine for Rs 25000 on which he spent Rs 5000 transport,
1000 as brokerage and Rs 4000 for installation, the machine was depreciated at
10% p.a every year on written down value basis. After 3 yrs the machine was
sold to Mr. Y for Rs 30500 and Rs 500 was paid as commission to the broker
.Prepare machinery account for 3 years

7. Ram Manufacturing Company purchased on 1st April, 2009, machinery for
Rs1,00,000. After having used it for three years, the owners sold the machinery
for Rs85,000. Depreciation is to be provided every year at the rate of 10% per
annum on the Fixed Instalment Method. Books are closed on 31st March every
year. Find out the profit or loss on sale of machinery







INVENTORY VALUATION


1. The following is the record of receipts and sales of certain goods during the first
week of JUNE 2010
























Stock verification on 3
rd
June , revealed a loss of 50 units
Show valuation of stock on 7
th
June 2010
FIFO
WAC

2. The following is the record of receipts and sales of certain goods during the first
week of August 2010
Date Receipts Units Rate (Rs)
1/8/10 Opening stock 500 8.00 per unit
2/8/10 Purchases 600 10.00 per unit
3/8/10 Issue 300
4/8/10 Purchases 100 10.20 per unit
Date Receipts Units Rate (Rs)
1/6/10 Opening stock 1500 16 per unit
2/6/10 Purchases 600 20 per unit
3/6/10 Issue 600 -
4/6/10 Purchases 500 19 per unit
5/6/10 issue 500
6/6/10 Purchases 150 18.5 per unit
7/6/10 Issue 400

5/8/10 Issue 400
6/8/10 Purchases 200 10.50 per unit
7/8/10 Issue 400
Stock verification on 3
rd
April , revealed a loss of 10 units
Show the valuation of stock on 7
th
August 2010 using
FIFO
WAC


3. Meena and Company Pvt Ltd provides you with the following information in respect of their purchases
from 1
st
to 5
th
of May 2013.

Opening stock 1000 units of a product @ Re1 lac;
purchased 400 units @Rs.1,50000;
issued 450 units;
purchased 500 units @Rs.160000;
issued 300 units.
Compute the value of the inventory using FIFO method on the closing of 5.5.2013.

4. Prepare cost of goods sold and value of closing stock using FIFO method and weighted average value
method from the following information in respect of certain customer of a bank branch.
March
1
Opening stock 100 units Rs.50 per unit
4 Purchases 200 Rs. 55 per unit
10 Issues 100
15 Purchases 140 Rs.60
18 Issues 100
24 Purchases 80 Rs.65
30 Issues 200






FINAL ACCOUNTS UNIT 5

1. The balances from the books of Parimal Ghosh are given below. Prepare Trading and Profit &
Loss Account for the year ended 31st March, 2007.
Stock as on 1.4.2006 9480
Purchase Returns 1800
Purchases 50800
Advertising 1500
Wages 1200
Commission (Cr.) 3200
Salaries 3400
Rent f received 2800
Direct expenses 1320
Sales 72000
Rent & Taxes 850
Stock (31.3.2007) 10700
Bad Debts 250
Discount (Dr.) 360
Interest received 760

2. The balances from the books of are given below. Prepare Trading and Profit & Loss Account for
the year ended 31st March, 2007.
Stock as on 1.4.2006 90000
Purchase Returns 3000
Purchases 54000
Advertising 3400
Wages 7000
Commission (Cr.) 4300
Salaries 7500
Rent received 5000
Direct expenses 220
Sales 72000
Rent & Taxes 6000
Stock (31.3.2007) 45000
Bad Debts 400
Discount (Dr.) 300
Interest received 560







3. The following is the trial balance of Z Co Ltd as at 31
st
December 2012.
Particulars Amount Dr. Amount Cr.
Stock as on 1
st
Jan. 2012 90000
Sales 55000
Purchases 25000
Wages 23000
Discount 9000
Furniture & Fixtures 65000
Salaries 23000
Rent 10000
Sundry expenses 8000
Patent & Trade Mark 40000
Interest paid 20000
Share capital 500000
Debtors & Creditors 100000 110000
Plant and Machinery 230000
Cash & bank balance 95000
Bills Payable 55000
TOTAL 729000 729000

Prepare trading & Profit and loss a/c and balance sheet after taking into consideration the following
adjustments:
I) Stock on 31
st
December 2012 was valued at Rs.40000
II) Depreciation on Furniture and Fixtures and Patents & Trade Mark is @ 5% each.







4. The following is the trial balance of Anand and Bros. Pvt. Ltd as at 31
st
December 2012.

Particulars Amount Dr. Amount Cr.
Stock as on 1
st
Jan. 2012 130000
Sales 83000
Purchases 75000
Wages 24000
Discount 6700
Furniture & Fixtures 75000
Salaries 60000
Rent 29000
Sundry expenses 12000
Patent & Trade Mark 80000
Interest paid 6000
Share capital 700000
Debtors & Creditors 28000 323000
Plant and Machinery 564700
Cash & bank balance 90000
Bills Payable 61000
TOTAL 1173700 1173700

Prepare trading & Profit and loss a/c and balance sheet after taking into consideration the following
adjustments:
I) Stock on 31
st
December 2012 was valued at Rs.40000
II) Outstanding salaries amounted to Rs. 800
III) Prepaid wages Rs. 900



















Problem -5








6. The following is the trial balance of X Ltd as at 31
st
December 2012.

Particulars Amount Dr. Amount Cr.
Stock as on 1
st
Jan. 2012 122000
Sales 214000
Purchases 65000
Wages 12000
Discount 22000
Furniture & Fixtures 30000
Salaries 22000
Rent 10000
Sundry expenses 4000
Patent & Trade Mark 100000
Interest paid 30000
Share capital 400000
Debtors & Creditors 75000 152000
Plant and Machinery 300000
Cash & bank balance 218000
Bills Payable 200000
TOTAL 988000 988000

Prepare trading & Profit and loss a/c and balance sheet after taking into consideration the following
adjustments:

I) Stock on 31
st
December 2012 was valued at Rs.50000
II) Depreciation on Plant and Machinery, Patents & Trade Mark is @ 10% each


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