2nd PUC Accountancy Model Question Paper 3 with Answers

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Karnataka 2nd PUC Accountancy Model Question Paper 3 with Answers

Time: 3.15 Hours
Max Marks: 100

Instructions:

1. All Sub questions of Section – A should be answered continuously at one place.
2. Provide working notes wherever necessary.
3. 15 Minutes extra time has been allotted for the candidates to read the questions,
4. 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.
Income and Expenditure Account is a ________ account.
Answer:
Nominal

Question 2.
State the relationship of a partner with the firm.
Answer:
A partner is an agent for a firm.

Question 3.
The portion of share sacrificed by the existing partner for the incoming partners is called as sacrifice ratio. [True / Flase].
Answer:
True.

Question 4.
Outgoing partner is compensated for parting with firm’s future profits in for remaining partners. In what ratio do the remaining partners contribute to such amount?
a. Gaining Ratio
b. Capital Ratio
c. Sacrificing Ratio
d. Profit Sharing Ratio.
Answer:
a. Gaining Ratio.

Question 5.
_________ type of shareholders have the right to receive arrears in case if the dividends are unpaid during the previous years due to losses.
Answer:

Question 6.
Which of the following statements are true?
a. A Debenture holder is a owner of the company.
b. A Debenture holder is a debtor of the company.
c. A Debenture holder is a creditor of the company.
d. A Debenture holder receives divided in case of profits earned.
Answer:
c. A Debenture holder is a creditor of the company

Question 7.
Expand TRSI.
Answer:
Debenture redemption fund investment.

Question 8.
The items are shown as a percentage to Revenue from operations in order to study/evaluate the operational activities of the business concern in _____________
a. common size Profit & loss Statement
b. Ratio Analysis,
c. comparative size Profit & loss Statement
d. Cash Flow Analysis.
Answer:
a. common size Profit & loss Staement

Question 9.
State the definition of Accounting Ratio.
Answer:
According to Kell and Bedford, “A ratio is an expression of the quantitative relationship between two numbers”.

Question 10.
Give an example for Notional cash flows.
Answer:
Increase in the value of debtors due to credit sales during the year is an example for Notional cash flows.

Section – B

II. Answer any five questions. Each carries two marks (5 × 2 = 10)

Question 11.
State any two differences between a Trading concern and a Not for Profit Organisation.
Answer:
1. A Trading concern is one which supplies goods and services for a price and earns profit out of its business transactions. A Not for Profit Organisation is one which provides services to its members.

2. A Trading concern is started for doing business and making profits, whereas a Not for Profit Organisation is started for promoting art, culture, sports, music, literature etc., for example schools, colleges, hospitals, public libraries.

Question 12.
In the absence of Partnership Deed, how do you treat the following?
(a) Interest on Capital
(b) Salary to a partner
Answer:
a. Interest on Capital: In the absence of a partnership deed, no interest is allowed to partners on the capital invested by them.
b. Salary to a Partner: In the absence of a partnership deed, no partner is entitled to get any salary.

Question 13.
What is Gain Ratio? why is it required? OR what is’ Benefit Ratio’?
Answer:
The Gain Ratio refers to the ratio in which the remaining partners gain the share of the retiring partner on his retirement.
Gain Ratio = New Ratio – Old Ratio
This 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 14.
Pass a journal entry for realisation expenses met on dissolution.
Answer:

Question 15.
What is Buy Back of Shares?
Answer:
The process under which the company purchases its own shares from existing equity shareholders, open market, odd lot shareholders or employees of the company is called as Buy Back of Shares.

Question 16.
What is a Statement of Profit and Loss?
Answer:
Statement of Profit and Loss records the summarized report of the expenses incurred and the revenues earned during the accounting period. It helps in the process of ascertainment of the profits or losses incurred by the company during the financial year.

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.
State the activities involved in a Cash Flow Statement.
Answer:
The activities involved in a Cash Flow Statement are as follows:
a. Operating Activities.
b. Investing Activities.
c. Financing Activities.

Section – C

III. Answer any four Questions. Each carries six marks (4 × 6 = 24) 

Question 19.
Charan and Sharan share profits and losses in the ratio of 3:2. They admitSachin into their firm for 1/6 share in profits. Charan personally guaranteed that Sachin’s share of profit, after charging interest on capital @ 10% p.a. would not be less than ₹ 15,000 in any year. The capital provided was as follows: Charan ₹ 1,2 5,000, Sharan ₹ 1,00,000 and Sachin ₹ 75,000. The profit for the year ending March 31,2016 amounted to ₹ 75,000 before providing interest on capital.
Show the Profit and Loss Appropriation A/c if the new profit sharing ratio is 3:2:1.
Answer:

Question 20.
Mohan and Madan are partners sharing profits and losses in the ratio of 4:3. They admit Murali into partnership. The new profit sharing ratio is agreed at 7:4:3 respectively. Find out the sacrifice ratio of old partners.
Answer:
Sacrifice Ratio = Old Ratio – New Ratio

∴ Sacrifice Ratio = \(\frac{1}{14}: \frac{2}{14}\)

Question 21.
Girish, Mahesh and Varun were sharing profits and losses in the ratio of 6:3:2 respectively. Their capitals on 1.4.2017 stood at ₹ 60,000, ₹ 30,000 and ₹ 20,000 respectively. On 30th Sept. 2107 Varun died.

The goodwill of the deceased partner’s share ₹ 10,000. The deceased partner’s share in accrued profit up to the date of his death is ₹ 4,200 Varun’s commission is ₹ 600 p.m. His drawings up to the date of death amounted to ₹ 8,000. Interest on capital at 10% p.a.
Answer:

Question 22.
Ganesh Co. Ltd.,issued 10,000 6% debentures of 100 each at a premium of 10% payable:
20 on application,
40 on allotment (including premium)
50 on first and final call.
All the debentures were subscribed and the money duly received.
Pass the journal entries up to the stage of first and final call money due.
Answer:

Question 23.
From the following information, prepare Balance Sheet Surya ltd., for the year ending 31st March 2018 as per Schedule III of Companies Act, 2013. Particulars?

Particulars	₹
Equity Share Capital	20,000
Inventories	14,00,000
Plant and Machinery	10,00,000
Preference share capital	12,00,000
Debenture share capital	6,00,000
Out standing Expenses	3,00,000
Proposed Dividend	5,00,000
Land and Buildings	20,00,000
Current Investments	8,00,000
Cash equivalents	10,00,000
Short term loan from Z ltd.,	4,00,000
Public Deposit	12,00,000

Answer:

Question 24.
Following information is given by a Company from its books of accounts as on March, 31,20 18. Calculate Debt Equity Ratio, Interest Coverage Ratio, and Debt to Capital Employed Ratio.

Particulars	₹
Inventory	1,00,000
Total Current Assets	1,60,000
Shareholders’ funds	4,00,000
13% Debentures	3,00,000
Current liabilities	1,00,000
Net profit before tax	3,51,000
Cost of revenue from operations	5,00,000
Total assets	8,00,000

Answer:

Question 25.
Froom the following information, calculate cash flow from financing Activities

During the year, the company redeemed debentures of ₹ 1,00,000
Answer:

Section – D

IV. Answer any four Questions, each carries Twelve marks: (4 × 12 = 38)  

Question 26.
Following are the Balance Sheet and Receipt & Payment Account of Raghavendra Education Trust, Bellary.

Adjustments:
(a) Expenses due but not paid ₹ 1000
(b) Subscriptions due but not received ₹ 200.
(c) Interest due but not paid ₹ 400
(d) Half of the entrance fees are to be capitalized.
(e) Depreciate buildings by 10%
Prepare:
(i) Income and Expenditure account
(ii) Balance Sheet as at 31.03.2017.
Answer:

Notes
(a) O/s Subscriptions & O/s Expenses [Old B/S] are not considered as they are clearly paid off in Receipts & Payments Account.

Question 27.
Manas, Nakul and Sankalp were partners sharing profits and losses in the ratio of 2:2:1. Their balance sheet as at 31-3-18 was as follows:

On the above date, Nakul retires from the firm and the following adjustments are necessary to be made:
a. Buildings and Stock are revalued at 10% more than the book value.
b. Machinery valued at 5% less than book value.
c. Furniture revalued at ₹ 24,800.
d. 0/S Expenses increased to₹ 6,100. O
e. Goodwill of the firm is raised at ₹ 30,000 and it is to be retained in the books.
f. The total amount payable to Nakul, transfer ₹ 30,000 to his loan account and the balance to be paid in Cheque immediately.
Prepare the necessary ledger accounts and the new balance sheet of the firm.
Answer:

Question 28.
Amara, Madhura and Prema are partners sharing profits and losses in the ratio of 2:1:1. Their Balance Sheet as on 31.3.2018 was as follows:

The firm was liquidated on the above date:
(a) Amara took over Joint Life Policy for ₹ 5,000
(b) Stock realised for ₹ 22,000, Debtors realised ₹ 4,100 and Machinery was sold for ₹ 58,000.
(c) Bills on hand realised in full.
(d) One bill for ₹ 500 under discount was dishonoured and had to be paid by the firm.
Prepare:
1. Realization A/ c
2. Partners Capital Accounts
3. Cash A/c
Answer:

Question 29.
ABC Company Ltd., issued 20,000 equity shares of ₹ 10 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 1,500 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
1,500 Shares × ₹ 7/share = ₹ 10,500

(c) The amount of Share Forfeiture at the time of re-issue is arrived as follows:
Shares re-issued × ₹ [Face value (-) Value on Re-issue]
1,500 shares × [₹10 (-) ₹ 7] = ₹ 4,500

(d) The profit on Re-issue of shares is arrived as follows:

Question 30.
The Balance Sheet of Vengamamba Ammal Co. Ltd., disclosed the following information as on 31-3-18.
15 % Debentures ₹ 15,00,000
Debenture Redemption Fund / Reserve ₹ 11,63,600
Debenture Redemption Fund Investment ₹ 11,63,600
[10% Govt. Securities]
The Contribution to debenture Redemption Fund was ₹ 1,30,800 p.a. for the year 2018 – 19 and 2019 – 20. Debentures are due for payment on 31 – 3 – 20. Assuming that securities were realised on 31 – 3 – 20 for a sum of ₹ 13,52,000 and interest on securities invested immediately. ’
Prepare:
a. 15% Debentures Account.
b. Debenture Redemption Fund Account.
c. Debenture Redemption Fund Investment account.
Answer:

Question 31.
The following is the Balance sheet of Sun Star Co., Ltd., as on 31 – 3 – 2016 and 31 – 3 – 2017. Prepare Comparative Balance Sheet.

Answer:

Question 32:
From the date given below, Calculate the ratios of Manik Malhotra Co. Ltd.,

Revenue from operations	₹ 8.75.000
Purchases	₹ 4,20,000
A/c Payables / Creditors	₹ 90,000
Bills Receivable	₹ 48,000
A/c Receivables / Debtors	₹ 59,000
Bills Payable	₹ 52,000
Average Stock	₹ 50,000
Cost of Revenue from operations	₹ 75,000
Net Profit	₹ 2,00,000
Operating Profit	₹ 3,00,000

a. Trade Receivables Turnover Ratio, Avg Collection Period (Days]
b. Trade Payables Turnover Ratio, Avg Payment Period (Months]
c. Stock / Inventory Turnover Ratio
d. Gross Profit Ratio
e. Net Profit Ratio
f. Operating Profit Ratio.
Answer:

Section – E
Practical Oriented Questions

V. Answer any two questions. Each carries five marks (2 × 5 = 10)

Question 33.
Classify the following items into capital and revenue :
a. Honorarium paid to a surgeon by a hospital
b. Installation charges of a new machinery.
c. Subscriptions to newspapers and periodicals
d. Cost of construction of pavilion by a sports club
e. Donation received for constructing a swimming pool
Answer:
a. Honorarium paid to a surgeon by a hospital – Revenue Expenditure
b. Installation charges of a new machinery. – Capital Expenditure
c. Subscriptions to newspapers and periodicals – Revenue Expenditure
d. Cost of construction of pavilion by a sports club – Capital Expenditure
e. Donation received for constructing a swimming pool – Capital Expenditure

Question 34:
Write Profit and Loss Appropriation Account of a firm with 5 imaginary figures.
Answer:

Question 35.
Prepare a Statement of Profit and Loss of a Company in vertical form with imaginary figures of 5 main heads only.
Answer: