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Karnataka 2nd PUC Accountancy Model Question Paper 1 with Answers
Time: 3.15 Hours
Max Marks: 100
Instructions:
- All Sub questions of Section – A should lie answered continuously at one place.
- Provide working notes wherever necessary.
- 15 Minutes extra time has been allotted for the candidates to read the questions.
- Figures in the right hand margin indicate full marks.
Section – A
I. Answer any eight questions, each carries one mark: (8 × 1 = 8)
Question 1.
Receipts and Payments account is a summary of all capital receipts and payments (True/False)
Answer:
False
Question 2.
State any one content of partnership deed.
Answer:
(a) The capital contribution by each partner and the profit sharing ratio.
Question 3.
At the time of admission of a new partner, general reserve appearing in the old balance sheet is transferred to:
a. All partner capital accounts
b. New partner’s capital A/c
c. Old Partners Capital A/c
d. None of the above
Answer:
c. Old partners Capital A/c
Question 4.
Why gain ratio is required on retirement of a partners?
Answer:
The gain ratio is required for the purposes of writing off the goodwill created to the extent of the retiring partner share against the capital accounts of the remaining partners.
Question 5.
________ is minimum number of members in a Public Ltd Company.
Answer:
7 (Seven)
Question 6.
Debenture holders are ________ of the company.
Answer:
Creditors
Question 7.
Expand EBIT.
Answer:
Earnings Before Interest and Taxes
Question 8.
The financial statement of a business enterprise include.
a. Balance sheet
b. Statement of profit and loss
c. Cash flow statement
d. All of the above
Answer:
d. All of the above
Question 9.
Name any one type of Turnover Ratio.
Answer:
Working Capital Turnover Ratio
Question 10.
Give an example for investing activities.
Answer:
Purchase of Land is an example for investing activities.
section – B
II. Answer any Five Questions, each question carry two marks (5 × 2 = 10)
Question 11.
State any two features of Receipts and Payments Account
Answer:
(a) It is a Real Account
(b) It includes both Capital and Revenue items
Question 12.
Write any two differences between fixed and fluctuating capital system.
Answer:
| Fixed Capital System | Fluctuating Capital System |
| (a) There will be two accounts for each of the partners namely “Capital Account” and “Current Account”. | There will be only one account for each of the partners and that is the “Capital Account”. |
| (b) Only the capital of a partner is entered in his capital account, thus, the capital remains fixed year after year | All the items are entered in the capital account, thus, the capital keeps fluctuating year after year. |
Question 13.
What is Revaluation Account?
Answer:
Revaluation account is an account opened for the purpose of ascertaining the profit or loss on account of revaluation of assets and liabilities of the firm.
Question 14.
Give the meaning of Realisation Account.
Answer:
Realisation Account is a Revenue account opened at the time of dissolution of a partnership firm. It is against. this account the assets are realized and the liabilities are paid off. The profit or loss that is ascertained will be transferred to the partners in their profit sharing ratio.
Question 15.
State any two types of issue of shares.
Answer:
The two types of issue of shares are as follows:
(a) At Par
(b) At Premium
Question 16.
List any two objective of financial statements.
Answer:
(a) To provide information about economic resource and obligation of business.
(b) To provide information about earning capacity of the business.
Question 17.
What is Trend Analysis?
Answer:
The financial statements may be analysed by comparing trend of series of information. This method of financial statement analysis determines the direction upwards or downwards and involves the computation of percentage relationship that each statement items bear to the same item in the base year.
Question 18.
What is cash flow statement?
Answer:
A Statement that provides information about the historical change in Cash and cash equivalents of an enterprise by classifying cash flows into operating, investing and financing activities is called as “Cash Flow Statement”.
OR
According to Balaji. K. Lecturer, Dept, of Commerce, M.S Ramaiah Composite P.U. College, “A statement which explains various sources of cash inflows, uses of cash outflows and at the same time depicts the position of the form in terms of its cash movements from one period to another period of accounting “is called as a Cash Flow Statement.
Section – C
III. Answer any Four Questions, each carries six marks: (4 × 6 = 24)
Question 19.
Anita and Kavita are partners sharing profits in the ratio 3 : 2 with capital of ₹ 1,00,000 and ₹ 60,000 respectively. Interest on capital is agreed at 6% per annum. Kavita is to be allowed and annual salary of ₹ 5,000. During the year Anita withdrew ₹ 10,000 and Kavita ₹ 5,000 for personal use. The interest on the same being ₹ 1000 and ₹ .500 respectively. The profit for the year ending March 31, 2018 amounted ₹ 25,000.
Prepare profit and loss appropriation account.
Answer:
Question 20.
Prakash and Akash are partners sharing profits’ and losses in the ratio of 3 : 2. They admitted Ramesh into partnership giving him 1/51h share which he acquires from Prakash and Akash in 2 : 1 ratio.
Calculate New profit Sharing ratio
Solution:
(a) New Profit Sharing Ratio = Old Share (-) Sacrified Share
(b) Sacrifice Share of Old Partners = New Partner’s Share × Acquired Share from Old Partners
So,
Prakash’s Sacrifice Share = 1/5 × 2/3 = \(\frac { 2 }{ 15 }\)
Akash’s Sacrifice Share = 1/5 × 1/3 = \(\frac { 1 }{ 15 }\)
New Profit Sharing Ratio:
Question 21:
Akash, Anil and Adarsh are partners sharing profit and losses in the ratio of 3 : 2 : 1. Their capitals as on 01.04.2017 were ₹ 70,000, ₹ 90,000 and ₹ 60,000 respectively. Akash died on 31.12.2017 and the partnership deed provided the following.
a. Interest on capital at 8% p.a.
b. Akash’s salary ₹ 2,000 per month.
c. His share of accrued profit upto the date of death based on previous year profit.
Firm’s profit for 2016 – 17 ₹ 24,000.
d. His share of goodwill ₹ 12,000.
Ascertain the amount payable to Akash’s excecutor by preparing Akash’s capital A/c.
Answer:
Question 22.
A Company Ltd. issued 20,000, 12% debentures of ₹ 100 each at a premium of ₹ 10 per debenture payable as follows.
On application ₹ 30
On allotment ₹ 60 (Including premium)
On first and final call ₹ 20.
All the debentures were subscribed and the money duly received.
Pass the journal entries upto the stage of first and final call money due.
Answer:
Question 23:
From the following information extracted from the books of Karnataka Ltd. Prepare the Balance Sheet of the company as at 31.03.2017 as per Schedule III of the Companies Act of 2013./ Received Schedule VI of the compa¬nies Act, 1956. –
|
Particulars |
₹ |
| Share holder funds | 19,60,00 |
| Non current liabiliies | 20,00,000 |
| Sundry creditors | 1,20,00 |
| Fixed assets | 32,00,000 |
| Inventories | 80,000 |
| Sundry debtors | 3,20,000 |
| Cash and cash equivalents | 4,80,000 |
Answer:
Question 24:
Current Ratio is 3 : 2 and Working Capital is ₹ 1,00,000. Calculate the amount of current assets and current liabilities.
Answer:
Working Capital = Current Assets (-) Current Liabilities
(a) Let Current Liabilities = x
1,00,000 = 3x (-) 2x
1,00,000 = lx
Current Liabilties (x) = \(\frac{1,00,000}{1}[latex] × 2 = 2,00,000
So, Current Liabilities = ₹ 2,00,000
(b) Let Current Assets = x
1,00,000 = 3x (-) 2x
1,00,000 = lx
Current Assets (x) = [latex]\frac{1,00,000}{1}\) ₹ 3 = 3,00,000
So, Current Assets = ₹ 3,00,0 00
Question 25:
From the following information, Calculate cash flows from financing activities.
| Particulars | 1 – 4 – 2017 ₹ | 31- 3 – 2018 ₹ |
| Equity share capital | 20,00,000 | 30,00,000 |
| Secured Loans | 9,00,000 | 16,00,000 |
During the year, secured loans was repaid ₹ 4,00,000 with an interest of ₹ 20,000 and received dividend of ₹ 50,000.
Answer:
Section – D
IV. Answer any Four Questions, each carries Twelve marks: (4 × 12 = 48)
Question 26:
Following are the Balance Sheet and Receipts and Payments Account of Sharada Education Society.
Adjustments:
1. Audit fees ₹ 2,500 still due.
2. Charge ₹ 250 as deprecation on furniture.
3. Half of the donation is to be considered as revenue.
4. Outstanding subscriptions ₹ 2,000 and subscriptions received in advance ₹ 1,500
Prepare :
a. Income and expenditure account
b. Balance sheet as at 31-3-2018.
Answer:
Note:
(A) 0/S Interest on 5% Govt. Bond are arrvied as follows:
(i) Amount of investment = ₹ 31,000
(ii) Amount of interest = 5% × ₹ 31,000 = ₹ 1,550
Less: Amount of interest on Govt. Bond given in Receipts & Payments A/c = ₹ 850
(iii) So, O/S interest = ₹ 700
(B) The term functions given on the payments side of the Receipts and Payments A/c should be taken as expenses. So, it should appear on the expenditure side of the account.
(C) Maps and Charts are fixed assets. So, they should appear on the assets side of the closing balance sheet.
Question 27:
Digvijay, Brijesh and Parakram were partners in a firm sharing profits in the ratio of 2:2:1.
Their balance sheet as at March 31-2018 was as follows.
Brijesh retired on March 31.2018 on the following terms.
1. Good will of the firm was valued at ₹ 60,000 and good will account to be raised to the extent of retiring partner’s share and Written off immediately.
2. Bad debts amounting to ₹ 2,000 were to be written off.
3. Patents were considered as valueless.
Prepare:
(i) Revaluation Account
(ii) Partners’ Capital Accounts and .
(iii) Balance Sheet of Digvijay and Parakram after Brjesh retirement.
Answer:
Notes:
(a) The Goodwill is raised to the extent of retiring partners share and it is written off in the ratio of the old partners which is 2 : 1.
(b) If any asset becomes valueless, it is nothing but loss, thus, such items must be recorded on the debit side of the Revaluation Account.
Question 28:
Anita and Sunita are Partners sharing Profits and losses equally. Their Balance Sheet as at 31.03.2018 was as follows:
On the above date, the firm was dissolved and the following information is available:
a. Assets realized as follows: Debtors ₹ 25,600, Stock ₹ 39,000, Building ₹ 66,000
b. Anita took over 50% of investments at 10% less on its book value and remaining investment was sold at a gain of 20%.
c. Furniture was taken over by Sunita at ₹ 12,000
d. Realization expenses amounted ₹ 2,000
Prepare:
a. Realsiation A/c
b. Partners’ capital A/c
c. Cash/Bank A/c
Answer:
Question 29:
ABC Company Ltd., issued 20,000 equity shares of 110 each. The amount was payable as follows:
On application ₹ 2
On allotment ₹ 3
On first and final call ₹ 5
All the shares were subscribed, Akash holding 500 shares did not pay first and final call money. The directors forfeited his shares and these shares were re-issued to Sagar at ₹ 7 per share as fully paid up.
Give the necessary journal entries in the book of the company.
Answer:
Notes:
(a) The amount of share forfeiture is arrived as follows:
(b) The amount on re-issue of shares are arrived at:
Shares re-issued × Amount paid per share .
500 Shares × ₹ 7/share = ₹ 3,500
(cj The amount of Share Forfeiture at the time of re-issue is arrived as follows:
Shares re-issued × [Face value (-) Value on Re-issue]
500 shares × [₹10 (-) ₹ 7] = ₹ 1,500
(d) The profit on Re-issue of shares is arrived as follows:
Question 30:
X Ltd issued 2,000,10% debentures of ₹ 100 each on 1.4.2017 at a discount of 10% and redeemable at premium of 10%
Give journal entries relating to the issue of debentures and debenture interest for the period ending March 31, 2018 assuming that interest was paid half yearly on September 30th and March 31st and tax deducted at source is 10%.
Answer:
Notes:
(a) Debenture Application Money is arrived as follows:
Total Number of Debentures issued × Value per debenture
2,000 × [100 (-) 10% discount = ₹ 90) = ₹ 1,80,000
(b) The loss on issue of debentures is arrived as follows:
Since the debenture is issued at 10% discount and redeemed at 10% premium. The company Suffers a total loss of 20%.
So, Total number of debentures issued × Face value per debenture = 2,000 × ₹ 100 = ₹ 2,00,000
(c) The debenture interest is calculated as follows:
(d) Tax deducted at source is arrived as follows:
Interest × TDS = 10,000 × 10% = ₹ 1,000
(e) Total Income Tax at Source payable:
(f) Generally, all the expenses like interest payable, depreciation, discount is transferred to Profit & Loss A/c.
Question 31:
Prepare Common Size Balance Sheet of Bombay Textile Ltd from the following information.
Answer:
Question 32.
From the following information to calculate:
a. Net – Asset Turnover Ratio
b. Fixed Asset Turnover Ratio
C. Working Capital Turnover Ratio
d. Operating Profit Ratio
e. Return on Capital Employed Ratio
f. Earnings per Share Ratio.
|
Particulars |
₹ |
| Revenue from operators | 15,00,000 |
| Net fixed Assets | 50,00,000 |
| Working Capital | 10,00,000 |
| Operating profit | 5,00,000 |
| Profit after interest & tax | 3,00,000 |
| Interest and tax expenses | 2,00,000 |
| Dividend paid to preference chares | 1,00,000 |
| Capital empoyed | 40,00,000 |
Answer:
(i) Capital employed = [Shareholder’s Funds + Non-Current Liabilities]
(h) So, out of capital employed i.e ₹ 40,00,000, 50% ¡s assumed to be Shareholder’s Funds.
[iii) Shareholder’s Funds includes Share Capital & Reserves and Surplus.
So, 40,00,000 × ₹ 50% = 20,00,000
(iv) The amount of ₹ 20,00,000 is considered to be Share Capital [Equity only]
(v) The Standard face value per Share is ₹ 10/₹ 100 .
Section – C
(Parctical Oriented Questions)
V. Answer any two questions, each carries Five Marks: (2 × 5 = 10)
Question 33.
Classify the following items into capital and revenue.
Answer:
a. Legacies received – Capital Receipts.
b. Match expenses met out of Match fund – Capital Payments
c. Salary paid to grounds men for upkeep of ground – Revenue Payments
d. Sale of old newspapers – Revenue Receipts.
e. Sale of Furniture – Capital Receipts
Question 34.
Prepare Executor’s Loan Account with imaginary figures showing the repayment in two annual installments along with interest
Answer:
Question 35.
Write the Proforma of Cash Flows from Operating Activities under Direct Method
Answer:
