sanskardeep

13 Textile Near Dinesh Hall, Ashram Road

AHMEDABAD

STD-11 ENG

Subject : ACCOUNTS
Date : 19-Mar-2018
Total Marks : Hours :
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Multiple Choice Questions: (1 marks each)

(1) In single entry system, to find profit or loss how many methods to be followed?
[A] 2 [B] 3 [C] 4 [D] 5
Ans : [A]
(2) Amount for bill sent for collection is collected by bank. This transaction is
recorded on ________ .
[A] Debit side of passbook [B] Debit side of cashbook
[C] Credit side of B.R.S. [D] Debit side of B.R.S.
Ans : [D]
(3) Based on concept, amount withdrawn for personal expense by owner of the
business debit it to the drawings account of owner.

[A] Accounting Entity [B] Materiality

[C] Periodicity [D] Dual effect

Ans : [A]
(4) Based on which concept provision for doubtful dents is made?

[A] Dual effect [B] Cost [C] Materiality [D] Prudence

Ans : [A]
(5) The difference between the credit side and the debit side of Sarvaiyun in Deshi
Nama is recorded on debit side as.....

[A] Akhar stock [B] Silak-Vadhghat

[C] Shri Purant Janse [D] Shri Purant Baki

Ans : [D]
(6) When an owner introduces capital in business,
[A] increase in capital - increase in liabilities
[B] increase in capital - increase in asset
[C] increase in liability - decrease in another liability
[D] increase in one assets - decrease in another assets
Ans : [B]
(7) What is the minimum amount one can transfer through RTGS ?
 [A] 1 Lakh [B] 2 Lakh [C] 3 Lakh [D] 4Lakh
Ans : [C]
(8) Goods return-credit is recorded in ________ book.
[A] Sales return [B] Purchase return [C] Sales [D] Purchase
Ans : [A]
(9) An error arises because of debiting or crediting a wrong account with correct
amount on the correct side is known as ……

[A] Errors of compensatory [B] Errors of omission

[C] Errors of principle [D] Errors

Ans : [C]
(10) Credit balance of Trading Account means ________ .

[A] Gross loss [B] Gross Profit [C] Net profit [D] Net loss

Ans : [B]
Answer in one or more sentence: (1 marks each)

(11) Describe different methods to record depreciation on asset from the view point of
accounting.

Ans : Ø To record depreciation on asset on asset from the view point of accounting
are of two type:

1) Method of providing depreciation on the respective asset.

2) Method of provision for depreciation.

(12) Write Havala Nondh of Vyaj on Gharkharch.

Ans : Ø Shri Gharkharch Khate Udhar to Shri Gharkharch na Vyaj Khate jama.

(13) Described whether following statements are true or false :Cheque received
from customer is debited to bank account.
Ans : Ø This statement is true.

(14) What is non-economic transaction ?

Ans : Ø Any business transaction which can not be measured in terms of money is
called non-economic transaction.

(15) Who prepares B.R.S. ?

Ans : Ø Trader prepares B.R.S.

(16) What do you mean by selling and Distribution expenses? Which expenses are
 included in it?

Ans : Ø Expenses incurred for the sales and distribution of goods are called selling
and distribution exp.

Ø e.g. Advertisement expenses, packing expenses, showroom expenses, carriage

outward etc. are included.

(17) Other expenses paid at the time of purchasing an asset are debited to which
account ?
Ans : Ø Other expenses paid at the time of purchasing an asset is to be debited to
concern asset account only.
(18) Give illustration of cash transaction of service.

Ans : Ø Example of cash transaction for service are as follow :

(i) Paid salary Rs. 5000

(ii) Received Rs. 1000 as commission from Keyur.

(20) What is the other identification name of bill of exchange?

Ans : Ø Bill of exchange is also called the 'promissory note'.

Answer in one or more sentence: (1 marks each)

(21) Give four illustrations of capital reserve.

Ans : Ø Following are the sources of Capital reserve:

Ø (i) Profit on sale of fixed assets and investments. (ii) Profit on revaluation of fixed
assets. (iii) Profit prior to incorporation of the company. (iv) Premium received by
the company on issue of shares or debentures. (v) Balance of share forfeiture
account after reissue of shares forfeited by the company. (vi) Capital redemption
reserve for redeeming preference share. (vii) Profit made in purchasing a business
i.e. when the purchase price is less than the net assets acquired. (viii) Profit on
redemption of debentures at discount.

Answer in short: (2 marks each)

(22) Explain the following terms used in Deshi Nama System: Silak Vadhghat Khatu

Ans : Shri Silak Vadhghat Khatu : Closing balance (silk) as per Rojmel or Bethomel
should tally with the actual cash on hand. If they do not tally with the closing cash
balance, efforts are made to detect the error by due verification. If the error is not
 detected inspite of such efforts and if the actual cash balance is more or less than
balance as per Rojmel or Bethomel, the differential amount is recorded to "Shri
Silak Vadhgat Khate".

If the actual cash balance is more than balance as per books of account, the
differential amount is credited to "Shri Silak Vadhghat Khate" and if the actual cash
balance is found less, it is debited to 'Shri Silak Vadhghat Khate'. When the reason
for such difference is traced, the reverse affect is given to "Shri Silak Vadhghat
Khate" and it is closed and correct effect is given to the concerned account. Thus
the correct balance is arrived at automatically.

(23) When is the concept of true and fair position of business realized?

Ans : Ø Practically, while preparing trial balance, total of debit balances and
total of credit balances tallies but still there may be error in the books of
accounts. In this situation, accounts prepared with the help of trial balance
never reveals true and fair position of business. In this situation once again
we have to go through the trial balance and we have to prepare corrected
trial balance. This is known as true and fair position of business.

(24) What is renewal of a bill? Which points are considered in that?

Ans : Ø The acceptor of a bill cannot make provision of the money on the maturity
date, he has to dishonor the bill. Hence, in this situation acceptor of the bill
contacts the drawer of the bill before the maturity date of the bill and requests him
to draw a new bill against the old bill for a new period. If the drawer of the bill
agree to his request. the old bill is cancelled and a new bill comes into existence.
When a new bill for an extended period is given in exchange of an old bill, it is
known as change of bill period or renewal of a bill.

Ø The following three points should be considered:

1) Cancel the old bill considering it to be dishonoured and pass necessary

journal entries in the books of accounts.

2) Calculate the interest on the additional period due to the extension of the
period of the bill and record its accounting effects.

3) Give the accounting entry for the acceptance of the new bill.

(25) Distinguish between debit note and credit note.

Ans : Ø Difference between debit and credit note :
No. Debit note Credit Note
(1) When goods purchased are When goods sold are returned
 returned due to some reason to
claim rebate, debit note is
issued.
(2) In purchase return book, debit
note number is recorded.
(3) Debit note is issued by
customer to their trader.
by customer due to some
reason, for confirmation of
rebate amount, credit note is
issued.
In sales return book, credit
note number is recorded.
Credit not is issued by trader
to their customer.

(26) What is the difference between Rojmel and Journal ?

Ans : Ø In Rojmel total eight folds, first four folds for Jama and remaining four
folds for Udhar. For cash transactions only one effect passed and for non-cash
transactions two effects are passed. From Rojmel, it is possible to find out closing
cash balance. While in Journal total five columns are there for every transactions
two or more than two effects passed for each and every transactions including
cash or credit transactions. From journal, it is not possible to find out closing cash
balance.

Answer in brief: (3/4 marks each)

(27) Pass adjustment entries in the Journal Proper of Darshan. (any 3)

(1) Unpaid rent ` 2,000.
(2) Pre paid insurance premium ` 400.
(3) Receivable brokerage ` 2,200.
(4) Advance received commission ` 320.
(5) Depreciation on Machinery ` 5,000
(6) Amount of ` 6,500 receivable from Jainam, which can not received now.
(7) Closing Stock ` 98,000.
Ans : Ø (1) Rent A/c Dr. TO Unpaid rent A/c ` 2,000 (2) Prepaid insurance
premium A/c Dr. To insurance premium A/c ` 400 (3) Receivable brokerage
A/c ` 2,200. (4) Commission A/c Dr. To Advance received commission ` 320.
(5) Depreciation A/c Dr. To Machinery A/c ` 5,000 Bad debts A/c Dr. To
Jainam A/c ` 6,500.
(28) From the given information prepare trial balance of Shri Brijimohan as on 31-
3-2016:

Name of A/c Amount Name of A/c Amount

(`) (`)
Opening stock 7,800 Plant - Machineries 4,500
Freehold assets 1,5000 Wages 1,000
Sundry debtors 6,000 Carriage inward 90
 Factory expenses 800 Royalty 100
Purchase of raw material 7,500 Carriage outward 100
Factory rent 700 Capital 8,000
Discount allowed 400 Discount received 360
Sundry creditors 2,000 Insurance 200
Bad debts reserve 150 Commission received 1,500
Commission paid 500 Bad debts 150
Office expenses 750 Salary 1,000
Travelling expenses 100 Legal expense 100
Bank balance 420 Cash balances 400
Loan borrowed 3,000 Office rent 400
Net sales 33,000

Ans : Ø

Trial balance of Shri Brijimohan as on 31-3-2016

Name of Account L. F. Debit Credit

balance balance
(`) (`)
Opening stock 7,800
Freehold assets 1,5000
Sundry debtors 6,000
Factory expenses 800
Purchase of raw 7,500
material
Factory rent 700
Discount allowed 400
Sundry creditors 2,000
Bad debts reserve 150
Commission paid 500
Office expenses 750
Travelling expenses 100
Bank balance 420
Loan borrowed 3,000
Net sales 33,000
Plant – Machinery 4,500
Wages 1,000
Carriage inward 90
Royalty 100
Carriage outward 100
Capital 8,000
Discount received 360
 Insurance 200
Commission 1,500
received
Bad debts 150
Salary 1,000
Legal expense 100
Cash balance 400
Office rent 400
Total 48,010 48,010

(29) From the given information prepare trial a balance of Pravin Patel as on 31-3-
2016:

Name of A/c Amount Name of A/c Amount

(`) (`)
Opening stock 7,440 Bank loan 1,760
Wages 4,000 Carriage inward 1,200
Sales 48,000 Purchase 30,000
Repairing 800 Carriage outward 600
Tax 600 Debtors 8,000
Land - Building 2,400 Cash balance 80
Plant - Machinery 3,000 Loose tools 720
Electricity expenses 920 Creditors 3,200
Capital 16,000 Sundry incomes 240
Office salary 1,000 Office furniture 240
Patent 400 Goodwill 6,000
Bank balance 1,800

Ans : Ø

Trial balance of Shri Pravin Patel as on 31-3-2016

Name of Account L. F. Debit Credit

balance balance
(`) (`)
Opening stock of goods 7,440
Wages 4,000
Sales 48,000
Repairing expenses 800
Taxes 600
Land – Building 2,400
Plant – Machinery 3,000
Electricity expenses 920
 Capital 16,000
Office salary 1,000
Patent 400
Bank balance 1,800
Bank loan 1,760
Carriage inward 1,200
Purchase 30,000
Carriage outward 600
Debtors 8,000
Cash balance 80
Loose tools 720
Creditors 3,200
Sundry incomes 240
Office furniture 240
Goodwill 6,000
Total 69,200 69,200

(30) The following information has been obtained in respect of the petty cash
book maintained by imprest system for the month ending of 31-3-2016.
Write journal entry to be passed by chief cashier.
Carriage charges ` 200
Miscellaneous expense ` 100
Tea and refreshment expense ` 200
Stationary expense ` 350
Postage expense ` 150
Wages ` 600
Ans :
Date Particulars L.F. Debit Credit
(`) (`)
31-3- Carriage charges A/c Dr. 200
2016
Misc. exp. A/c Dr. 100
Tea and refreshment exp. A/c Dr. 200
Stationery exp. A/c Dr. 350
Postage exp. A/c Dr. 150
Wages A/c Dr. 600
To Petty cashier A/c (Being the 1,600
particulars exp. paid as per petty,
cash book)
1-4-2016 Petty cashier A/c Dr. 1,600
To cash A/c (Being cash given to 1,600
petty cashier on imprest system)
(31) What is the importance of Provision?

Ans : Ø Importance of provision is under:

(i) Provision is made for probable expenses, loss and liability of respective year
and therefore it is appropriated out of the revenue of the same year and
hence true profit or loss of the business can be ascertained.

(ii) Provision is made to prevent impact of transactions made during the year on
the financial performance in future.

(iii) Known liability of future can be spread evenly over certain years by making
provision.

(iv) Assumption of going concern and principle of prudence can be followed by

making provision.

(v) If provision is not made against decrease in the value of assets in future the
capital of the business may be wiped off. Such risk can be avoided by
making provision.

(vi) Required funds can be managed by making provision of a certain amount

every year out of the profit. On the expiry of the useful life of an asset, the
managed funds can be used to purchase new assets.

Answer in brief: (6 marks each)

(32) Cashbook of Balaram shows debit balance of ` 40,000 on 30-,4,-2016, which

is different from balance as per passbook. From the following information
prepare a bank reconciliation statement as on 30-4-2016 :
2016
April 1 Cheque deposited but not credited by bank ` 28,000
4 Cheque issued but not presented ` 32,000.
6 Cheque deposited by Bunty directly in bank account ` 12,000.
6 Company has credited dividend of ` 8,000 in Balsram's Bank
account through National Electronic Fund Transfer which is
not recorded in cash book.
10 Bank has credited ` 800 for bank interest, which is not
recorded in cash book.
13 Bill of Prabhshankar discounted with bank is dishonored and
bank has debited ` 15,300 including nothing charges which is
not known to Balshram.
20 A cheque of ` 12,000 issued to Seema on 28-4-2016, which is
 paid by bank on 2-5-2016.
22 A cheque of ` 6000 received from Bhargav is deposited with
bank but not recorded in cashbook.
29 A cheque of ` 12,000 was issued to BSNL for telephone bill,
which was paid by bank on 30-4-2016 but it is recorded in
cashbook by ` 1,200.
Ans : Ø
Cashbook(Bank column)
Dr. Cr.
Date Particulars R. L. Amount Date Particulars R. L. Amount
(Receipts) N F. (`) (Payments) No F. (`)
o
2016 2016
April- To Balance b/f 40,000 April- By Prabha 15,300
1 13 Shankar A/c
6 To Bunty A/c 12,000 29 By BSNL A/c 10,800
6 To Dividend 8,000 30 By Balance c/f 44,700
A/c
10 To Bank int. 800
A/c
22 To Bhargav 600
A/c
25 To Totalling 4,000
mistake
70,800 70,800
Bank balance as per corrected cash book ` 44,700
Bank Reconciliation Statement of Shri Balram as on 30-4-2016
Trans. no. Particulars Debit(`) Credit (`)
2016 Bank balance as per - 7,335
Cashbook
April - 1 Corrected bank balance as 44,700 -
per cash book
1 Cheques deposited but not - 28,000
credited by bank
4 Cheques issued but not 32,000 -
presented for payment
20 Cheques issued but not 12,000 -
debited by bank
Bank balance as per 60,700
Passbook
 88,700 88,700

(33) On 31-3-2016 Shri Bedharkar has tallied his trial balance by debiting a
difference of ` 1,000 to suspense account and there after he has prepared
final accounts. After preparation of final accounts the following errors are
detected.

(1) Goods of ` 3,500 returned by Jatin in posted on debit side of his account.

(2) Total of purchase returned book is over cast by ` 800.

(3) Paid ` 600 for personal medical bill and the amount is debited to
miscellaneous as to rent account.

(4) ` 1,200 received from Divesh for rent is posted to the credit of her account as
well as to rent account.

(5) Goods of ` 5,000 sold to Vinay is recorded in purchase book.

(6) ` 6,000 paid to Deepak for repayment of loan is not posted to his account.

Ans : Ø

(1) Suspense A/c Dr. ` 7,000, to Jatin's A/c ` 7,000

(2) Purchase return A/c Dr. 800, to Suspense A/c ` 800

(3) Drawings A/c Dr. ` 600, to Miscellaneous expense A/c ` 600

(4) Divesh's A/c Dr. ` 1,200, to Suspense A/c 1,200

(5) Vinay's A/c Dr. 10,000, to Purchase A/c ` 5,000, to Sales A/c ` 5,000

(6) Deepak's A/c Dr. ` 6,000, to suspense A/c ` 6,000, ` 34,600 rectified profit.

(34) At the time of preparing final accounts of Parth Shah as on 31-3-2016, the
following errors are found out. Pass necessary rectification entries to rectify
the same.

(1) Total of sales return book is over casted by mistake of ` 400.

(2) Paid ` 350 form stationary expense, as posted twice in stationary expenses
account.

(3) Opening balance of bills payable of ` 2,500 is written on the debit side.

(4) ` 1250 received from Anurag is debited in his account as ` 250.

 (5) ` 140 received from Dilip as discount is debited as discount given account.

(6) Debit balance of a debtor, Manish Vyas, ` 6,000 is omitted to be recorded in

trial balance.

(7) Balance of commission paid A/c ` 350 is recorded as credit balance by ` 530
in trial balance.

(8) Bank credited ` 250 of interest is recorded on payment side of cash book.

(9) Goods of ` 4,500 sold to Rajnikant which is recorded correctly in sales book.
But it is posted ` 450 in Rajnikant's account.

(10) ` 2,500 received from Mayur ism posted of the debit side of his account.

(11) Balance of discount reserve bank over draft in trial balance, is written as `
5,800 instead of ` 8,500

(12) Balance of discount reserve by creditors as ` 1,450 is shown as ` 145 in the

column of credit balance of trial balance.

(13) Total of bills payable book is overcast by ` 1,500.

(14) ` 2,500 paid to Jayendra for advance salary is posted to salary account and
advance salary A/c as both side.

(15) ` 250 cash on hand, which is written in the column of credit side trial
balance.

(16) Balance of drawings account ` 1,500 is written in the column of credit side of
trial balance.

(17) Paid amt. ` 25 for sundry expenses, which is posted ` 250 in that account.

(18) Total of payment side of discount column of cash book is over cash by ` 100.

(19) Total of bills payable book is undercast by ` 450.

(20) Received ` 150 for interest is posted to the debit side of interest account.

Ans : Ø Rectification of Errors:

(1) The error will be rectified by writing in sales return book ` 400 in the column of
amount on the credit side and in the column of particulars. 'Being total of sales
return book is over cast.

(2) The error will be rectified by writing in stationary expense account ` 350 in the
 column of amount on the credit side and in the column of particulars. 'Being the
amount debited twice by mistake.

(3) The error will be rectified by writing in bills payable account ` 5,000 in the
column of amount on the credit - side and in the column of particulars 'Being
opening balance is recorded on wrong side'.

(4) The error will be rectified by writing in Anurag's account ` 1,500 in the column of
amount on the credit - side and in the column of particulars 'Being the wrong
amount is written on wrong side'.

(5) The error will be rectified by writing in credit side of discount account ` 280 in
the column of amount and in the column of particular 'Being amount is written
wrong side'.

(6) The error will be rectified by writing ` 6,000 a balance of Manish Vyas's account
in the debit column of the trial balance.

(7) The error will be rectified by instead of the written credit balance of ` 530 and the
debit column of the trial balance.

(8) The error will be rectified by writing in bank's account of debit side ` 500 in the
column of amount and in the column of particulars. 'Being the wrong side
written'.

(9) The error will be rectified by writing in Rajnikant's account ` 4,050 in the column
of amount on the debit side and the column of particular 'Being less amount is
posted'.

(10) The error will be rectified by writing in Mayur's account ` 5,000 in the column of
amount on the credit side and in the column of particulars. 'Being the wrong side
written.

(11) The error will be rectified by instead of the credit balance of ` 5,800 and write
correct balance of ` 8,500 in trial balance.

(12) The error will be rectified by instead of the written credit balance of ` 145 and
write correct balance of ` 1,450 on the debit side of the trial balance.

(13) The error will be rectified by writing in bills receivable account ` 1,500 in the
column of amount on the credit side and in the column of particulars 'Being total
of bills receivables book is over cast.

(14) The error will be rectified by writing in wages account ` 2,500 in the column of
amount on the credit side and in the column of particulars. 'Being total of bills
 receivables book is over cast.'

(15) The error will be rectified by writing ` 250 as the credit balance of trial balance is
shown as debit balance.

(16) The error will be rectified by writing ` 1,500 as the credit balance of trial balance
is shown as debit balance.

(17) The error will be rectified by writing in general expenses ` 225 on the credit side
in the column of amount and in the column of particulars. 'Being wrong amount is
posted'.

(18) The error will be rectified by writing in discount account ` 100 on the debit side
in the column of amount and in the column of particulars 'Being total of discount
account is over cast.'

(19) The error will be rectified by writing in bills of payable account ` 450 on the
credit side in the column of amount and in the column of particulars 'Being total
of bills payable account is under - cast.'

(20) The error will be rectified by writing in interest account ` 300 on the credit side in
the column of amount and in the column of particulars 'Being posted as wrong
side'.

(35) On 1-4-2015 Pratiksha Limited has purchased new machine for 1,38,000, its
installation is ` 12,000. Company provides depreciation at 10 % every year under
reducing balance method. Company records depreciation by creating depreciation
provision. Pass necessary journal entries in the book of company year ending 31-
3-16.

Ans : Ø [Ans: (1) Machine A/c. Dr. ` 1,50,000 to Bank A/c. ` 1,38,000, cash A/c.
` 12,000. (2) Depreciation A/c. Dr. 15,000. (3) Profit & loss A/c. Dr. ` 15,000 to
depreciation A/c. ` 15,000]

Answer in brief: (6 marks each)

(36) From the given receipt - payment account and additional information, prepare the
income - expenditure account for the year ending 31 - 3 - 2016 and balance sheet
as on same day of Modern Club.

Receipt - payment Account for the year ending 31 - 3 - 2016 of

Modern Club.
Dr.
Cr.

Receipt Amt. (`) Payment Amt. (`)

To Cash balance 25,000 By Bank overdraft 15,000
To Subscription By Salary 30,000
2014 -15 02,500 By Stationary - Printing 2,500
2015 -16 22,000 By Furniture 10,000
2016 -17 15,000 26,500 By Investment 55,000
To Legacy 40,000 By Subscription of news paper 5,000
To Income of entertainment 15,000 By Expense of entrainment 8,000
programme
To Entrance fees 20,000 By Cash in hand 7,500
To Interest on investment 10,000 By Bank balance 5,500
To Sale of old furniture (Book 750
Value 1,000)
To Sale of old news paper 1,250
1,38,500 1,38,500
Additional information: (i) Outstanding on 1 - 4 - 2015: Furniture ` 15,000,
Building ` 50,000, Investment ` 1,00,000, capital fund ` 1,77,500 (ii)
Outstanding subscription of current year ` 2,500 (iii) Outstanding salary is `
2,500. (iv) Outstanding of interest on investment is ` 1,000. (v) 50% entrance fee
is transferred to capital fund. (iv) Provide 10% depreciation p.a. on building and
furniture on closing balance.

Ans : Ø Expenditure of expenditure over income ` 6,600, Closing capital fund `

2,34,100, depreciation on furniture ` 2,400, Total of Balance sheet ` 2,38,100.

(37) Heet Mehta has accounts in two banks. (1) Dena bank and (2) Bank of
Baroda (BOB).
From the following information prepare B.R.S. of BOB as on 31-3-2015.
Bank balance as per passbook of BOB ` 5,000.
(1) A cheque of ` 5,000 deposited into BOB, by mistake it is recorded in Dena
bank column.
(2) A cheque of BOB of ` 2,500 is issued to Amitbhai which is not presented for
payment till date.
(3) A customer Vipul Directly deposited ` 3,000 and ` 6,000 in Dena bank and in
BOB, for which Heet is unware.
(4) A cheque of ` 2,800 issued from BOB is still not paid by bank.
(5) A cheque of ` 6,000 deposited into BOB, which is not credited by bank.
(6) Dena bank credited ` 300 for interest and BOB debited ` 200 for commission.
 Both of these transacions are not recorded in cash book.
(7) ` 5,000 cash deposited into BOB, is not recorded in cashbook.
(8) Cheques of ` 10,800 are deposited into Dena bank, out of which bank credits
` 4,800 cheques. By mistake this ` 4,800 is recorded in BOB column in
cashbook.
(9) Payment side of Dena bank column is overcasted by ` 500.
(10) Cash ` 5,000 is withdrawn from Dena bank. By mistake it recorded in BOB
column.
Ans : Ø Transactions No. 7 and 9 wil not be recorded as B.R.S. Total of B.R.S. =
` 21,000, Bank balance as per cashbook = ` 4700, In debit Column = ` 5,000,
` 2,500, ` 6,000, ` 200, ` 4,800, ` 5,000.

(38) Cashbook of Shri Sudhir shows bank balance of ` 5,000 on 31-12-2015.

Prepare a bank reconciliation statement from the information given below :
(1) A cheque of ` 8,000 was deposited with bank on 29-12-2016, but this
cheque is not credited in passbook by bank till 31-12-2015.
(2) A cheque of ` 6,000 was sent for collection to bank on 30-12-2015 which
is not collected by bank till 31-12-2015.
(3) A cheque of ` 3,000 was issued on 28-12-2015 for payment of electricity
bill, which is not debuted by bank in passbook till 31-12-2015.
(4) A cheque of ` 2,000 was drawn on 27-12-2015 and given to creditor but
it is not presented for payment till 31-12-2015.
(5) Interest of ` 80 credited in pass book by bank, which is not debited in
cash book.
(6) Bank debited ` 100 in passbook for bank charges, which is not credited
in cash book.
Ans : Ø
Bank Reconciliation Statement of Shri Sudhir as on 31-12-2015
Trans. no. Particulars Debit (`) Credit (`)
Bank balance as per Cash book 5,000 -
(1) Cheque dep. into bank but not - 8,000
credited in passbook
(2) Cheque sent for collection but - 6,000
amount not collected by bank
(3) Cheque issued, not debited by bank 3,000 -
in passbook
(4) Cheque issued, but not presented for 2,000 -
payment in the bank
(5) Bank credited bank interest, but in 80 -
cash book it is not recorded
 (6) Bank debited bank interest, but in 100
cash book it is not recorded
Bank Overdraft as per Passbook 4,020 -
14,100 14,100

Answer in brief: (11 marks each)

(39) Prepare Final Accounts of Shreshthi from the following Trial Balance and
Adjustments:

Trail Balance of Ms. Shreshthi as on 31 - 12 - 2015

Particulars Dr. (`) Cr. (`)

Capital & Drawings 15,000 1,00,000
Building 24,000
Depreciation on building 1,000
Plant 25,000
Opening stock 46,000
Furnitures 8,400
Debtors & Creditors 75,500 65,000
Cash Bank 8,990 -
Goods Accounts 90,000 1,65,000
Goods Return 10,000 8,000
Wages 10,000 -
Salary (Rs. 750 p.m) 9,000 -
Bad Debts & B.D. Reserve 1,500 2,000
Octroi 4,000 -
Outstanding wages - 1,000
Advertisement Expenses 4,000 -
Discount 3,050 1,500
12% Loan & its interest 100 5,000
12% Investment & its interest 4,000 240
Insurance premium 1,200 -
Bills 20,000 5,000
Commission - 8,000
Total 3,60,740 3,60,740
Adjustments:

(1) Closing stock is ` 20,000, in which Market Value of 50% goods is 50% less.
(2) Out total sales 20% is export sales in which 10% subsidy is to be
received. (3) Debtors of ` 10,000 declared insolvent a final dividend of 80
paisa in a rupee could be recorded on building to 10%. (4) Increase the rate of
depreciation on building to 10%. (5) Goods of ` 4,000 has been stolen away
from Railway. Railway Company has accepted a claim of ` 2,500.
 Ans : Ø Gross profit ` 32,000, Net profit ` 15,180, Total of B/s ` 1,76,680,
Closing Capital ` 1,00,180, Govt. Subsidy ` 3,100

(40) Prepare final account from the Trial Balance and adjustment of Baldev as on
31 - 03 - 2015:

Trial Balance of Baldev as on 31 - 03 - 2015

Debit Balance Amt. (`) Credit Balance Credit. (`)

Drawings 45,000 Trading Account 5,70,000
Fixed Assets 6,75,000 Capital 7,50,000
Office expense 82,500 Bank overdraft 18,000
Rent 22,500 Traders 3,00,000
Insurance 45,000 Bills payable 37,500
Salaries - Wages 3,75,000 Bad debt reserve 21,000
Customers 2,25,000 Discount 10,500
Bills receivables 22,500 Outstanding office expense 3,000
Discount 7,500
Prepaid insurance premium 3,750
Closing stock 45,000
Cash Balance 22,500
Selling & distribution 1,20,000
expenses
Bonus 18,750
17,10,000 17,10,000
Adjustments: (1) After preparing trading account, it was found that has taken
goods for personal use of ` 7,500, which is not recorded in the book. Outstanding
Carriage Inward ` 3,750. (2) Calculate interest on capital is 5%. (3) Outstanding
Interest on Bank overdraft ` 750. (4) After preparing trading account, it was found
that ` 22,500 received from debtors, which is wrongly credited to sales account.
(5) Provide depreciation on fixed assets at 10%. (6) Unrecorded credit purchases
` 12,000. (7) Goods of ` 22,500 are destroyed by fire, for which the Insurance
company has accepted a claim of 90% amount. (8) A fixed assets of ` 30,000 sold
for ` 22,500 for cash on 1 - 10 - 2015 which is not recorded in the book.

Ans : Ø

Adjusted Trading A/c of shri Baldev for the year ended 31 - 3 - 16

Dr.
Cr.

Particulars Amt. (`) Particulars Amt. (`)

To O/s Carriage inward 3,750 By Bd. b/d 5,70,000
To Credit - Pur. 12,000 By Sales -
- Good taken for pur. 07,500 Wrongly recorded 22,500 Sales
- Good destroyed by fire 22,500 - 22,500
- 18,000 By purchase brought from Opposite 18,000
side
Wrongly recorded sale (brought from 22,500
opposite side)
To G/P (adjusted) (Trf. to P/L A/c) 5,61,750
5,88,000 5,88,000
Profit and Loss A/c of Shri Baldev as on 31 - 3 - 2015.

Dr.
Cr.

Particulars Amt. (`) Particulars Amt.

(`)
Administrative/Office Exp.: By Adjusted Gross Profit 5,61,750
(Transferred from Trading A/c.)
To Office Expenses 82,500 Other Incomes:
To Rent 22,500 By Discount 10,500
To Insurance 45,000 By Net Loss (Transferred to 2,11,500
capital A/c)
To Bonus 18,750
To Salary - wages 3,75,000
Selling & Distribution Exp.:
To Discount 7,500
To selling & Dist. expenses 1,20,000
Financial Expenses:
To O/s Int. on Bank O/D 750
To Int. on Capital 37,500
Other Expenses & Loss:
To Depreciation on fixed 66,000
Assets
To Loss due to fire 2,250
To Loss Due to Sale of fixed 6,000
assets
7,83,750 7,83,750
Balance Sheet of Shri Baldev as on 31 - 03 - 2016

Liabilities Amt. (`) Assets Amt. (`)

Capital: Fixed Assets:
Opening Balance 7,50,000 Fixed Assets 6,75,000
+ Int. on Cap. 0,37,500 - Depre. 0,64,500
7,87,500 - Sold Assts. 0,30,000 5,80,500
Less: Current Assets:
Drawings 0,45,000 Closing Stock 45,000
+ Addition in Drawings 0,07,500 Cash Balance 2,25,500
+ Net Loss 2,11,500 2,64,000 5,23,500 + Unrecorded 0,22,500 20,250
Balance
Current Liabilities: O/a amount of claim
Bills payable 37,500 Debtors 2,25,500
O/s. Office expenses 3,000 Unrecorded rec.amt. 0,22,500 2,02,500
O/s. Carriage Inward 3,750 Loan & Advances:
B.D. Reserve 21,000 Bill Receivables 22,500
Bank over Draft 0,18,000 Prepaid insurance 3,750
+ O/s Interest 0,00,750 18,750
Traders 3,00,00
+ Unrecorded Pur. 0,12,000 312,000
9,19,500 9,19,500