Page 1
CBSE PAST YEAR PAPER
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 1/10
th
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 accoun ts 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.
Page 2
CBSE PAST YEAR PAPER
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 1/10
th
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 accoun ts 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.
CBSE PAST YEAR PAPER
2
Pass necessary journal entry for the treatment of goodwill on change in the profit sharing ratio of Anant, Gulab and
Khushbu.
Answer :
Journal
Date Particulars L.F.
Debit Amount
Rs
Credit
Amount
Rs
Gulab’s Capital A/c Dr. 8,000
Khushbu’s Capital A/c Dr. 32,000
To Anant’s Capital A/c 40,000
(Gulab and Khushbu, being the gaining
partners compensated Anant for his
share of sacrifice)
Working Notes:
WN1 Calculation of Sacrificing Ratio
WN2 Adjustment of Goodwill
Gulab and Khushbu, being the gaining partner will pay Anant, a sacrificing partner in the ratio of their gain i.e. 1 : 4.
Q5 :
Give the meaning of forfeiture of shares.
Answer :
Cancellation of shares on non-payment of due calls is known as forfeiture of shares.
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 :
Page 3
CBSE PAST YEAR PAPER
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 1/10
th
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 accoun ts 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.
CBSE PAST YEAR PAPER
2
Pass necessary journal entry for the treatment of goodwill on change in the profit sharing ratio of Anant, Gulab and
Khushbu.
Answer :
Journal
Date Particulars L.F.
Debit Amount
Rs
Credit
Amount
Rs
Gulab’s Capital A/c Dr. 8,000
Khushbu’s Capital A/c Dr. 32,000
To Anant’s Capital A/c 40,000
(Gulab and Khushbu, being the gaining
partners compensated Anant for his
share of sacrifice)
Working Notes:
WN1 Calculation of Sacrificing Ratio
WN2 Adjustment of Goodwill
Gulab and Khushbu, being the gaining partner will pay Anant, a sacrificing partner in the ratio of their gain i.e. 1 : 4.
Q5 :
Give the meaning of forfeiture of shares.
Answer :
Cancellation of shares on non-payment of due calls is known as forfeiture of shares.
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 :
CBSE PAST YEAR PAPER
3
(i) Rs 2,25,000
(ii) Rs 2,20,000
(iii) Rs 2,21,000
(iv) Rs 2,19,500
Answer :
Calculation of amount received with first call
Hence, the correct answer is option (iii).
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.
Answer :
I would like to suggest the following three alternatives to the Board of Directors.
a. To reject the excess application of 10,00,000 shares
b. To allot shares to all the share applicants on pro-rata basis, i.e. allotting 5,00,000 shares to 15,00,000 share applicants
c. To exercise a mix of both the practices as listed in (a) and (b). That is, rejecting the excess application say for 5,00,000
shares and allotting 5,00,000 shares to the remaining 10,00,000 share applicants.
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
Answer :
Profit and Loss Appropriation Account
for the year ended March 2014
Dr. Cr.
Particulars
Amount
Rs
Particulars
Amount
Rs
Interest on Capital A/c: Profit and Loss A/c 2,00,000
Brij 80,000
Nandan 1,20,000 2,00,000
2,00,000 2,00,000
Working Notes:
WN1 Calculation of Interest on Capital
WN2 Calculation of Proportionate Interest on Capital
Page 4
CBSE PAST YEAR PAPER
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 1/10
th
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 accoun ts 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.
CBSE PAST YEAR PAPER
2
Pass necessary journal entry for the treatment of goodwill on change in the profit sharing ratio of Anant, Gulab and
Khushbu.
Answer :
Journal
Date Particulars L.F.
Debit Amount
Rs
Credit
Amount
Rs
Gulab’s Capital A/c Dr. 8,000
Khushbu’s Capital A/c Dr. 32,000
To Anant’s Capital A/c 40,000
(Gulab and Khushbu, being the gaining
partners compensated Anant for his
share of sacrifice)
Working Notes:
WN1 Calculation of Sacrificing Ratio
WN2 Adjustment of Goodwill
Gulab and Khushbu, being the gaining partner will pay Anant, a sacrificing partner in the ratio of their gain i.e. 1 : 4.
Q5 :
Give the meaning of forfeiture of shares.
Answer :
Cancellation of shares on non-payment of due calls is known as forfeiture of shares.
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 :
CBSE PAST YEAR PAPER
3
(i) Rs 2,25,000
(ii) Rs 2,20,000
(iii) Rs 2,21,000
(iv) Rs 2,19,500
Answer :
Calculation of amount received with first call
Hence, the correct answer is option (iii).
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.
Answer :
I would like to suggest the following three alternatives to the Board of Directors.
a. To reject the excess application of 10,00,000 shares
b. To allot shares to all the share applicants on pro-rata basis, i.e. allotting 5,00,000 shares to 15,00,000 share applicants
c. To exercise a mix of both the practices as listed in (a) and (b). That is, rejecting the excess application say for 5,00,000
shares and allotting 5,00,000 shares to the remaining 10,00,000 share applicants.
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
Answer :
Profit and Loss Appropriation Account
for the year ended March 2014
Dr. Cr.
Particulars
Amount
Rs
Particulars
Amount
Rs
Interest on Capital A/c: Profit and Loss A/c 2,00,000
Brij 80,000
Nandan 1,20,000 2,00,000
2,00,000 2,00,000
Working Notes:
WN1 Calculation of Interest on Capital
WN2 Calculation of Proportionate Interest on Capital
CBSE PAST YEAR PAPER
4
Note: Interest on capital is to be treated as an appropriation of profits and is to be provided to the extent of available
profits i.e. Rs 2,00,000.
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'.
Answer :
Suvidha Ltd.
Balance Sheet
Particulars
Note
No.
Amount
Rs
I. Equity and Liabilities
1. Shareholders’ Funds
a. Share Capital 1 1,00,00,000
b. Reserves and Surplus 2 7,000
1,00,07,000
II. Assets
1. Current Assets
a. Cash and Cash Equivalents 3 1,00,07,000
1,00,07,000
NOTES TO ACCOUNTS
Note No. Particulars
Amount
(Rs)
1 Share Capital
Authorised Capital
10,00,000 shares of Rs 100 10,00,00,000
Issued Capital
1,00,000 shares of Rs 100 1,00,00,000
Subscribed, Called-up and Paid-up Capital
1,00,000 shares of Rs 100 1,00,00,000
2 Reserves and Surplus
Capital Reserve 7,000
3 Cash and Cash Equivalents
Cash at Bank 1,00,07,000
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.
Page 5
CBSE PAST YEAR PAPER
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 1/10
th
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 accoun ts 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.
CBSE PAST YEAR PAPER
2
Pass necessary journal entry for the treatment of goodwill on change in the profit sharing ratio of Anant, Gulab and
Khushbu.
Answer :
Journal
Date Particulars L.F.
Debit Amount
Rs
Credit
Amount
Rs
Gulab’s Capital A/c Dr. 8,000
Khushbu’s Capital A/c Dr. 32,000
To Anant’s Capital A/c 40,000
(Gulab and Khushbu, being the gaining
partners compensated Anant for his
share of sacrifice)
Working Notes:
WN1 Calculation of Sacrificing Ratio
WN2 Adjustment of Goodwill
Gulab and Khushbu, being the gaining partner will pay Anant, a sacrificing partner in the ratio of their gain i.e. 1 : 4.
Q5 :
Give the meaning of forfeiture of shares.
Answer :
Cancellation of shares on non-payment of due calls is known as forfeiture of shares.
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 :
CBSE PAST YEAR PAPER
3
(i) Rs 2,25,000
(ii) Rs 2,20,000
(iii) Rs 2,21,000
(iv) Rs 2,19,500
Answer :
Calculation of amount received with first call
Hence, the correct answer is option (iii).
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.
Answer :
I would like to suggest the following three alternatives to the Board of Directors.
a. To reject the excess application of 10,00,000 shares
b. To allot shares to all the share applicants on pro-rata basis, i.e. allotting 5,00,000 shares to 15,00,000 share applicants
c. To exercise a mix of both the practices as listed in (a) and (b). That is, rejecting the excess application say for 5,00,000
shares and allotting 5,00,000 shares to the remaining 10,00,000 share applicants.
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
Answer :
Profit and Loss Appropriation Account
for the year ended March 2014
Dr. Cr.
Particulars
Amount
Rs
Particulars
Amount
Rs
Interest on Capital A/c: Profit and Loss A/c 2,00,000
Brij 80,000
Nandan 1,20,000 2,00,000
2,00,000 2,00,000
Working Notes:
WN1 Calculation of Interest on Capital
WN2 Calculation of Proportionate Interest on Capital
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Note: Interest on capital is to be treated as an appropriation of profits and is to be provided to the extent of available
profits i.e. Rs 2,00,000.
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'.
Answer :
Suvidha Ltd.
Balance Sheet
Particulars
Note
No.
Amount
Rs
I. Equity and Liabilities
1. Shareholders’ Funds
a. Share Capital 1 1,00,00,000
b. Reserves and Surplus 2 7,000
1,00,07,000
II. Assets
1. Current Assets
a. Cash and Cash Equivalents 3 1,00,07,000
1,00,07,000
NOTES TO ACCOUNTS
Note No. Particulars
Amount
(Rs)
1 Share Capital
Authorised Capital
10,00,000 shares of Rs 100 10,00,00,000
Issued Capital
1,00,000 shares of Rs 100 1,00,00,000
Subscribed, Called-up and Paid-up Capital
1,00,000 shares of Rs 100 1,00,00,000
2 Reserves and Surplus
Capital Reserve 7,000
3 Cash and Cash Equivalents
Cash at Bank 1,00,07,000
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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Answer :
Journal
In the books of Good Blankets Ltd.
Date Particulars L.F.
Debit Amount
Rs
Credit
Amount
Rs
Machinery A/c Dr. 7,00,000
To Vendor 7,00,000
(Purchased machinery)
Vendor Dr. 7,00,000
To Equity Share Capital A/c 5,00,000
To 8% Debentures A/c 2,00,000
(Issued 50,000 equity shares of Rs 100
each and 2,000 8% Debentures of Rs 100
each to the vendor)
Value involved in the above scenario is ‘Creation of employment opportunities’. By hiring the victims of flood affected
area, the company wants to generate employment opportunities for them so that they can earn and mange their
livelihood.
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.
Answer :
Karan’s Capital A/c
Dr. Cr.
Particulars
Amount
Rs
Particulars
Amount
Rs
Balance b/d 13,000 Arunas Capital A/c 90,000
Executors A/c 2,00,430 Varunas Capital A/c 67,500
Profit and Loss Suspense A/c 26,250
Karanas Loan A/c 28,000
Interest on Karan’s Loan 1,680
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