SAMPLE PAPER- 7 (unsolved)

ACCOUNTANCY
Class XII
Time allowed: 3 hours

Maximum Marks: 80

General Instructions:
1. This question paper contains Two parts A& B.
2. Both the parts are compulsory for all.
3. All parts of questions should be attempted at one place.
4. Marks are given at the end of each question.
Question Paper Designed by : Dr. Vinod Kumar
Book recommended by author : ULTIMATE BOOK OF ACCOUNTANCY
Publisher : Vishwas Publications (09216629576, 09256657505)
Dr. Vinod Kumar is Author of Ultimate Book of Accountancy and a great name in the field of accountancy

Part A
Partnership, Share Capital and Debentures
1. State the conditions under which the capital balances may change under the system of a
Fixed Capital Account.
(1)
2.

Name two factors affecting value of goodwill of a firm.

(1)

3. MM, KK and PP are partners in a firm. PP retired from the firm. After making adjustments for
Reserves and Revaluation of Assets and Liabilities the balance in PPs capital account was
Rs.1,20,000. MM and KK paid Rs.1,80,000 in full settlement to PP. Identify the item for which
MM and KK paid Rs.60,000 more to PP.
(1)
4. Vinod Limited has a paid up Share Capital of Rs.50,00,000 and a balance of Rs.10,00,000 in
Securities Premium Reserve Account. The company management do not want to carry over the
balance. State the purposes for which the balance can be utilised.
(1)
(Hint: Securities Premium Reserve can be utilised as per section 78)
5.

What is meant by Redemption of Debentures by Lump sum Payment?

(1)

6.

Bat and Ball are partners in a firm sharing profits in the ratio of 3:2 respectively. The fixed capital
of Bat is Rs.4,80,000 and Ball Rs.3,00,000. On 1.4.2012 they admitted Wicket as a new partner for
1/5th share in future profits. Wicket brought Rs.3,00,000 as her capital. Calculate the value of
goodwill and record necessary journal entries.
(3)

7. X, Y and Z were the partners in a firm sharing profits in the ratio of 4:3:3. The firm was dissolved.

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After transfer of assets and external liabilities to Realisation Account, the following transactions
took place:
(i)
Kamal, a Creditor, to whom Rs.6,000 were due to be paid, accepted Office Equipment at
Rs.4,000 and the balance was paid to him in cash.
(ii)
An unrecorded liability of the firm Rs.7,800 was paid by X.
(iii) There was a Dr. balance in P/L A/c Rs.5,000.
(3)
8.

Govinda and Gopala were partners from 1.1.2008 with capitals of Rs.90,000 and Rs.60,000
respectively. They shared profits in the ratio of 3:2. They carried on business for two years. In the
first year they made a profit of Rs.75,000 but in Second year a loss of Rs.30,000 was incurred. As
the business was no longer profitable, they dissolved the firm on 31.12.2009. Creditors on that date
were Rs.30,000. Each partner withdrew for personal use, Rs.12,000 per year. The expenses of
realisation were Rs.4,500. The assets realised Rs. 1,50,000. Prepare Realisation Account, Partners
Capital A/cs and Cash Account.
(3)
(Hint: Realisation loss already given in Question Rs.30,000; Sundry Assets bal. Fig.1,77,000;
Cash A/c Total Rs.1,50,000)
9. A business had earned average profits of Rs.2,00,000 during the last few years and the normal
rate of return in similar business is 10%. Find out the value of goodwill by:
(i) Capitalisation of Super Profit Method
(ii) Super Profit Method if the goodwill is valued at 3 years purchase of super profits.
The assets of the business were Rs.20,00,000 and its external liabilities Rs.3,60,000. (4)

10. John, Robert and Dolly are partners in a firm sharing profits in the ratio of 2:2:1 respectively.
Firm closes its accounts on 31st March every year. Robert died on 30th September 2012. There was
a balance of Rs.96,000 in Roberts Capital account in the beginning of the year. In the event of
death of any partner. The partnership deed provides for the following:
(i) Interest on capital will be calculated at the rate of 12% p.a.
(ii) The Executor of deceased partner shall be paid Rs.15,000 for his share of goodwill.
(iii) His share of Reserve fund which is Rs.10,000, shall be paid to executor.
(iv) His share of profit till the date of death will be calculated on the basis of sales. It is also
specified that the sales during the year 2011-12 were Rs.8,00,000. The sales from 1st April
2012 to 30th September 2012 were Rs.1,50,000. The profit of the firm for the year ending 31st
March 2012 was Rs.1,00,000.
Prepare Roberts Capital account to be presented to his executor.
(6)
11. Sunshine Limited forfeited 100 shares of Rs.10 each, issued at a discount of 10%. The company
has called up only Rs.8 per share. Final call of Rs.2 each has not been made on these shares. These
shares were allotted to Aishwarya, who did not pay the first call of Rs.3 per share were reissued at
Rs.7 per share, as Rs.8 paid up. Give journal entries and show your working clearly. (4)
(Hint: Capital Reserve Rs.240)
12. Mahindra Limited has an authorised capital of Rs.5,00,000 divided into equity shares of Rs.50
each. The company invited applications for 8,000 shares. Applications for 6,000 shares were
received. All calls were made and duly received except the final call of Rs.10 per share on 500
shares. Out of the shares on which final call was not received 400 shares were forfeited. Show how
the share capital will be shown in the balance sheet of the company as per Revised Schedule VI
Part 1 of the Companies Act 1956.
(4)

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13. Tanya and Ridhima are partners in a firm. They admitted Sonia as a partner without capital for
1/3rd share in the profits of the firm. She is blind by birth but having good management qualities.
The new partnership agreement provides for the following:
(i) 10% of the trading profit will be donated to the Prime Ministers Relief Fund.
(ii) 5% of the trading profit will be donated to the National Blind Relief Fund.
(iii) Products will be sold at a discount of 15% on maximum retail price to the people living
below poverty line.
(iv) New retail shops will be opened in the Naxal affected areas of the country.
(v) New jobs of salespersons will be reserved for the girls belonging to Scheduled Castes and
Scheduled Tribes.
The Trading Profit of the firm for the year ended 31.3.2012 was Rs.10,00,000.
Identify any four values considered by the partners while preparing the new partnership
deed and also prepare the Profit & Loss Appropriation Account.
(6)
14. Pass necessary Journal entries for Issue of Debentures for the following:
(i) BPLM Limited issued 3,000, 12% Debentures of Rs.100 each at a discount of 10%,
redeemable at a premium of 5%.
(ii) ABCD Limited issued 3,200, 9% Debentures of Rs.100 each at a premium of Rs.20 per
Debenture, redeemable at a premium of Rs.10 per Debenture.
(iii) HLPC Limited issued 2,000, 9% Debentures of Rs.100 each at a discount of 5%
redeemable at par.
(6)
15. Mahaluxmi Limited invited applications for issuing 1,00,000 Equity Shares of Rs.10 each.
The amount was payable as follows:
On Application Rs.3 per share; On Allotment Rs.5 per share; Balance on first & final call.
Applications for 1,40,000 shares were received. Allotment was made to all applicants on pro-rata
basis. Excess money received on application was adjusted towards sums due on allotment.
Ramesh, who had applied for 1,400 shares, did not pay the allotment money and on his failure to
pay the allotment money his shares were forfeited. After wards, the first and final call was made.
Kapoor, who had been allotted 1,000 shares, did not pay the first and final call. His shares were
also forfeited. Out of the forfeited shares 1,800 shares were reissued at Rs.8 per share fully paid
up. The reissue shares included all the shares of Ramesh.
Pass necessary journal entries.
(8)
OR
Give necessary journal entries related to forfeiture and reissue in the following cases:
(a) Vinod Limited forfeited 10 shares of Rs.10 each on which Rs.6 were called up only, issued at a
discount of 10% to Mr. Kothari on which he had paid the application money of Rs.2 per share.
Out of these, 8 shares were reissued to Mr. Modi at Rs.6 per share, Rs.8 called up.
(b) Max Bombay Limited forfeited 1,000 shares of Rs.10 each (Rs.8 Called up) for the non-payment
of the allotment money of Rs.5 per share including Rs.2 as premium. Of these 800 shares were
reissued to Mr.Vinod at Rs.7 per share as Rs.8 called up.

16. Balance Sheet of A and B as on 31.3.2013 is given below. Their profit sharing ratio is 2:1.

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Liabilities
Creditors
General Reserve
Capitals :
A
40,000
B
30,000

Amount Assets
Amount
16,000 Freehold Property
20,000
24,000 Furniture
6,000
Stock
12,000
Debtors
60,000
70,000 Cash
6,000
Profit & Loss A/c
6,000
1,10,000
1,10,000
C was admitted on the following terms:
(a) C will bring in Rs.21,000 of which Rs.9,000 will be treated as premium for goodwill to be
retained in the business.
(b) 50% of General Reserve is to remain in the business as reserve for doubtful debts.
(c) He will be entitled for 1/4th share of profit in the business.
(d) Depreciation is to be provided on furniture @5%.
(e) Stock is to be valued at Rs.10,500.
Give journal entries and Balance Sheet.
(8)
(Hint: Revaluation Loss Rs.1,800; Balance Sheet Rs.1,11,200)
OR
The Balance Sheet of A, B and C who were sharing profits in the ratio of 4:3:2 respectively stood
as follows on 31st December 2013:
Liabilities
Amount Assets
Amount
Creditors
3,800 Land and Building
4,000
9,000 Plant and Machinery
8,000
General Reserve
6,000
Capitals :
Stock
A
20,000
Debtors
23,000
B
7,500
Less : Reserve 400
22,600
C
10,000
37,500 Cash
700
9,000
Advertisement Suspense
50,300
50,300
B has given notice to retire from the firm, the following adjustments were agreed upon:
(i) Stock be appreciated by 10% and reserve for doubtful debts is not required in future.
(ii) Land and Building be appreciated by 20%.
(iii) That adjustments be made in accounts to rectify previous entries whereby B was credited
in excess by Rs.1,500 while A and C were debited in excess by Rs.1,100 and Rs.400 respectively.
(iv) Goodwill of the firm Rs.63,000 and Bs Share of the same being adjusted to that of A and C
who are going to share profits in the ratio of 2:1 in future.
(v) That the entire capital of the firm as newly constituted will be readjusted by bringing in or paying
of cash so that the future capitals of A and C be in the ratio of 2:1.
Pass necessary Journal entries and prepare Balance Sheet showing Bs balance as loan.
(Hint: Revaluation Loss Rs.1,800; Balance Sheet Rs.43,100)

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Part B
Financial Statement Analysis
17. State the importance of Analysis of Financial Statements for Trade Unions.

(1)

18. Give the meaning of Cash and cash equivalents.

(1)

19. Vinod Limited paid the instalment of Rs.50,000 for Machinery purchased on credit in which
interest of Rs.4,000 was included.
How will you show this payment at the time of preparation of Cash Flow Statement? (1)
20. Give major heads and sub heads under which following items will be disclosed in the Balance
Sheet as per Revised Schedule VI of the Companies Act, 1956:
(3)
(a) Debentures
(e) Accrued Income
(b) Capital Reserve
(f) Brands
(c) Bills Payable
(g) Mastheads and Publishing Titles
(d) Rent received in advance
(h) Employees Provident Fund
21. Prepare a common size income statement from the following information:
Particulars
Amount
Income:
Revenue from operations
Other income
Expenses:
Cost of material consumed
Other expenses

(4)

5,00,000
20,000
5,20,000
2,40,000
10,000
2,50,000
30,000

Tax
(Hint: N/P after tax 48%)

22. From the following information obtained form the books of Vinod Limited as on 31.3.2012.
Calculate (a) Quick Ratio and (b) Stock Turnover Ratio:
Inventory Rs.1,00,000
Trade Receivables Rs.1,20,000
Advance Tax Rs.4,000
Cash Rs.60,000;
Trade Payables Rs.1,05,000
Bank Overdraft Rs.8,000
Cost of goods sold Rs.4,20,000
Additional Information:
Closing Inventory was Rs.20,000 more than the opening Inventory.
(4)

23. From the following Balance Sheets of Vinod Limited, prepare Cash Flow Statement: (6)
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Particulars
I. EQUITY AND LIABILITIES :
Shareholders Funds:
Equity Share Capital
Reserve and Surplus :
Contingencies Reserve
Statement of Profit & Loss
Non-current Liabilities
Long Term Borrowings : 8% Debentures
Current Liabilities :
Trade Payables (Creditors)
Other Current Liabilities (Outstanding Expenses)
Total
II. ASSETS:
Non-Current Assets:
Fixed Assets:
Tangible Assets
Current Assets :
Short term Investment
Inventories
Trade Receivables
Cash & Cash Equivalents
Other Current Assets (Prepaid Expense)

Note No.

Total
Notes to Accounts
Particulars
1. Tangible Assets
Land and Building
Machinery
Less : Accumulated Depreciation

2012
1,50,000
26,000
1,76,000
20,000
1,56,000

31-3-2012

31-3-2013

1,90,000

1,90,000

30,000
8,000

30,000
11,500

45,000

35,000

51,500
6,500

48,000
6,000

3,31,000

3,20,500

1,56,000

1,63,000

55,000
41,000
33,500
45,000
500

37,000
53,000
21,500
45,000
1,000

3,31,000

3,20,500

2013
1,50,000
35,000
1,85,000
22,000
1,63,000

Additional Information:
(a) 10% dividend was paid in cash.
(b) New Machinery for Rs.15,000 was purchased but old Machinery costing Rs.6,000 was sold for
Rs.2,000, accumulated depreciation was Rs.3,000.
(c) Rs.10,000, 8% Debentures were redeemed by purchase from the open market @ Rs.96 for a Debenture
of Rs.100.
(iv) Rs.18,000 Investment were sold at book value.
(Hint: Operating Activities Rs.16,100; Investing Rs.13,000; Financing Rs.21,100)

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