Students must start practicing the questions from RBSE 12th Accountancy Model Papers Set 5 with Answers in English Medium provided here.
RBSE Class 12 Accountancy Model Paper Set 5 with Answers in English
Time: 2:45 Hours
Maximum Marks: 80
General Instructions for the Examinees :
- Candidate must first write his/her Roll No. on the question paper compulsorily.
- All the questions are compulsory.
- Write the answer to each question in the given answer book only.
- For questions having more than one part the answers to those parts must be written together in continuity.
- If there is any error/difference/contradiction in Hindi & English versions of the question paper, the question of the Hindi version should be treated valid.
Section-A
Question 1.
Multiple Choice Questions
(i) Income and expenditure account records: [1]
(a) Receipts and payments of revenue and capital nature both
(b) Income and expenditure of revenue nature only
(c) Expenditure of capital nature only
(d) Receipts of revenue nature only
Answer:
(b) Income and expenditure of revenue nature only.
(ii) In the absence of partnership deed, partners will get: [1]
(a) Salary
(b) Commission
(c) Interest on loan and deposit
(d) Sharing of profit in capital ratio
Answer:
(c) Interest on loan and deposit
(iii) Meera, Myra, and Neera were partners sharing profits in the ratio of 2: 2: 1. They decided to share future profits in the ratio of 7: 5 : 3 with effect from 1st April 2019. Their Balance sheet as on that date showed a balance of ₹ 45,000 in the Advertisement Suspense Account. The amount to be debited respectively to the capital accounts of Meera, Myra and Neera for writing off the amount in the Advertisement Suspense Account will be: [1]
(a) ₹ 18,000, ₹ 18,000 and ₹ 9,000
(b) ₹ 15,000, ₹ 15,000 and ₹ 15,000
(c) ₹ 21,000, ₹ 15,000 and ₹ 9,000
(d) ₹ 22,500, ₹ 22.500, and Nil
Answer:
(a) ₹ 18,000, ₹ 18,000 and ₹ 9,000
(iv) Subscribed capital is : [1]
(a) That part of authorized capital which is issued to the public for subscription.
(b) That part of issued capital which has actually been subscribed by the public.
(c) That part of subscribed capital which has been called up on the, shares.
(d) That part of subscribed capital which has not yet been called up on the shares.
Answer:
(b) That part of issued capital which has actually been subscribed by the public.
(v) Premier Ltd. issued 2,000, 9% Debentures of ₹ 100 each at par, fetMetiiable after five years at a premium of 10%.
The minimum amount invested in Debenture Redemption Investments will be: [1]
(a) ₹30,000
(b) ₹33,000
(c) ₹ 50,000
(d) ₹1,00,000
Answer:
(a) ₹30,000
(vi) No debenture redemption reserve is required for debentures issued by: [1]
(a) manufacturing companies
(b) infrastructure companies
(c) banking companies
(d) trading companies
Answer:
(c) banking companies
(vii) Debentureholders are: [1]
(a) owners of the company
(b) customers of the company
(c) loan providers of the company
(d) None of these
Answer:
(c) loan providers of the company
(viii) Debentureholders receive: [1]
(a) profit
(b) dividend
(c) rent
(d) interest
Answer:
(d) interest
(ix) As per Schedule III, Part I of the Companies Act, 2013, ‘calls-in-arrears’ will be presented under which of the following head/sub-head, in the Balance Sheet of a company ? [1]
(a) Reserves and Surplus
(b) Current Liabilities
(c) Contingent Liabilities
(d) Shareholders’ Funds
Answer:
(d) Shareholders’ Funds
(x) In common size balance sheet, total of equity and liabilities are assumed to be equal to: [1]
(a) 1
(b) 100
(c) 10
(d) 1000
Answer:
(b) 100
(xi) Vertical analysis is also known as: [1]
(a) Structural Analysis
(b) Static Analysis
(c) Dynamic Analysis
(d) None of these
Answer:
(b) Static Analysis
(xii) Ideal current ratio is assumed: [1]
(a) 3:1
(b) 1: 1
(c) 2:1
(d) 1:2
Answer:
(c) 2:1
Question 2.
Fill in the blanks [1 x 6 = 6]
(i) In the absence of partnership deed, Interest on partners loan is provided at the rate of ………………………… per cent. [1]
Answer:
6
(ii) Equity shareholders are the ………………………………… of the company. [1]
Answer:
owners
(iii) Debentures form …………………………….. capital of the company. [1]
Answer:
borrowed/loan
(iv) When the issued price of a debenture is more than that of its face value, debenture is said to be issued at …………………… . [1]
Answer:
premium
(v) Financial statements are the ……………………….. products of accounting period. [1]
Answer:
end
(vi) ……………………… ratios provide information critical to the long-run operation of the firm. [1]
Answer:
Solvency.
Question 3.
Very Short Answer Type Questions [1 x 12 = 12]
(i) Name an item that is never shown on the payment side of receipt and payment account, but is shown on the debit side of the income and expenditure account. [1]
Answer:
Loss on sale of fixed assets.
(ii) A and B were partners in a firm sharing profits and losses in the ratio of 5 : 3. They admitted C as a new partner.
The new profit sharing ratio between A, B and C was 3: 2 :3. A surrendered \(\frac{1}{5}\) th of his share in favour of C. Calculate B’s sacrifice.
Answer:
A s old share = \(\frac{5}{8}\)
As sacnfice = \(\frac{1}{5}\) of \(\frac{5}{8}=\frac{1}{8}\)
C s share = \(\frac{3}{8}\)
Bs sacrifice = Cs share – A’s sacrifice = \(\frac{3}{8}-\frac{1}{8}=\frac{2}{8}\)
(iii) What is meant by ‘Issue of Debentures as a Collateral Security? [1]
Answer:
Issue of debentures as a collateral security means debentures issued as secondary 8ecurity when the company obtains a loan.
(iv) ‘Interest paid on debentures is a charge against the profits of the company.’ It this statement correct?
Give reason in support of your answer. [1]
Answer:
Yes. Reason: Interest on debentures has to be paid whether the company earns profit or not.
(v) Vashya Ltd. issued 30,000 10% Debentures of ₹ 100 each as collateral security for a loan of ₹ 25,00,000 taken from the Bank of India. Fill in the blanks for the journal entry for issue of debentures as a collateral security: [1]
Answer:
(vi) X Ltd. invited applications for issuing 500, 12% debentures of 100 each at a discount of 5%. These debentures were redeemable after three years at par. Applications for 600 debentures were received. Pro-rata allotment was made to all the applicants. Pass necessary journal entries for the issue of debentures assuming that whole amount was payable with application. [1]
Answer:
(vii) Give the meaning of debenture. [1]
Answer:
A debenture is a written acknowledgment of debt taken by the company as it is issued under the seal of the company. A debenture certificate contains the terms of the repayment of principal sum at a specified date & terms of payment of interest at a fixed percentage.
(viii) What is bond? [1]
Answer:
Bond is an acknowledgment of debt. Traditionally its were issued by the government to raise the long-term finance.
(ix) Why are financial statements called as historical document? [1]
Answer:
Financial statements analysis is a histórical document because they are related to the past period information.
(x) State any one limitation of financial statement analysis. [1]
Answer:
- Financial Statement Analysis: It is a historical analysis as it analyses what has happened till date. It doesn’t reflect the future.
- It ignores price level changes as a change in price level makes analysis of financial statements of different accounting years invalid.
- It ignores qualitative aspects as the quality of management, quality of staff, etc. are ignored while carrying out the analysis of financial statements.
- It suffers from the limitations of financial statements as the analysis is based on the information given in the financial statements.
- It is not free from bias of accountants such as method of inventory valuation, method of depreciation, etc.
- It may lead to window dressing, i.e. showing a better financial position than what actually is by manipulating the books of accounts.
- It may be misleading without the knowledge of the changes in accounting procedure by a firm.
(xi) Explain two differences between horizontal and vertical analysis. [1]
Answer:
Distinction between Horizontal Analysis and Vertical Analysis
Basis | Horizontal Analysis | Vertical Analysis |
Period | It requires a coma rather than financial statements of two or more accounting periods. | It deals with same items of different periods. |
Components of items | It requires the statements of one period | It deals with different items of same period. |
(xii) What is average collection period? [1]
Answer:
Average Collection Period provides an approximation of the average time that it takes to collect debtors. It is computed by dividing 365 or 12 by the trade receivables turnover ratio.
Section-B
Short Answer Type Questions [2 x 13 = 26]
Question 4.
Find out the cost of medicines consumed during 2014-15 from the following information: [2]
Details | Amount (₹) |
Payment for purchase of medicines. | 3,70,000 |
Creditors for medicines purchased : On 1.4.2014 |
25,000 |
On 313.2015 | 17,000 |
Stock of Medicines: | |
On 1.4.2014 | 62,000 |
On 31.3.2015 | 54,000 |
Advance to suppliers of medicines | |
On 14.2014 | 11,500 |
On 31.3.2015 | 18,200 |
Answer:
Question 5.
Raj and Neeraj are partners in a firm. Their capital as on April 01, 2017 was ₹ 2,50,000 and 1,50,000 respectively. They share profits equally. On July 01, 2017, they decided that their capital should be.₹ 1,00,000 each. The necessary adjustment in the capitals were made by introducing or withdrawing cash by tire partners. Interest on capital is allowed @ 8% p.a. Compute interest on capital for both the partners for the year ending on March 31, 2018. [2]
Answer:
Interest on Capital = 16,50,000 x \(\frac{8}{100} \times \frac{1}{12}\) = ₹ 11,000
Interest on Capital of Neeraj
Interest on Capital = ₹ 13,50,000 x \(\frac{8}{100} \times \frac{1}{12}\) = ₹ 9,000
Question 6.
A and B were partners in a firm sharing profits and losses in the ratio of 3 : 2. They admit C into the partnership with 1/6 share in the profits. Calcualte the new profit sharing ratio. [2]
Answer:
Profit share of C = \(\frac{1}{6}\)
Let the profit of new firm be 1
Remaimng profit of the firm = \(1-\frac{1}{6}=\frac{6-1}{6}=\frac{5}{6}\)
As old share = \(\frac{3}{5} \)
A’s new share = Remaining profit x old share
= \(\frac{5}{6} \times \frac{3}{5}=\frac{15}{30} \)
B s Old share = \(\frac{2}{5}\)
B’s new share = Remaining profit x old share
= \(\frac{5}{6} \times \frac{2}{5}=\frac{10}{30}\)
New profit sharing ratio of A, B and C = \(\frac{15}{30}: \frac{10}{30}: \frac{1}{6}\)
= \(\frac{15}{30}: \frac{10}{30}: \frac{5}{30}\)
= 15:10:5 = 3:2:1.
Question 7.
Rajan and Rajani are partners in a firm. Their capitals were Rajan ₹ 3,00,000; Rajani ₹ 2,00,000. During the year 2015 the firm earned a profit of ₹ 1,50,000. Calculate the value of goodwill of the firm by capitalisation method assuming that the normal rate of return is 20%. [2]
Answer:
Total capital employed = ₹ (3,00,000 + 2,00,000) = ₹ 5,00,000
Actual profit = ₹ 1,50,000
Normal rate of return = 20%
Capitalised Value =\( \text { Actual Profit } \times \frac{100}{\text { Normal Rate of Return }} \)
= ₹ 1,50,000 x \(\frac{100}{20}\) = ₹ 7,50,000
Goodwill =Capitalised Value — Capital Employed
= ₹ (7,50,000 – 5,00,000)
= ₹ 2,50,000
Question 8.
Mohit Glass Ltd. issued 20,000 shares of ₹ 100 each at ₹ 110 per share, payable ₹ 30 on application, ₹ 40 on the allotment (including premium), ₹ 20 on the first call, and ₹ 20 on final call. The applications were received for 24,000 shares and allotted 20,000 shares and rejected 4,000 shares and the amount returned thereon. The money was duly received. Give journal entries. [2]
Answer:
Question 9.
A limited company offered for a subscription of 1,00,000 equity shares of ₹ 10 each at a premium of ₹ 2 per share, 2,00,000 10% Preference shares of₹ 10 each at par. [2]
Record these transactions in the journal and cash book of the company. [2]
Answer:
Question 10.
Eastern Company Limited, with an authorized capital of ₹ 10,00,000 is divided into equity shares of ₹ 10 each, issued 50,000 equity shares at a premium of ₹ 3 per share payable as follows :
On Application ₹ 3 per share
On Allotment (including premium) ₹ 5 per share
On first call (due three months after allotment) ₹ 3 per share and the balance as on when required.
Applications were received for 60,000 shares and the directors allotted the shares as follows :
(a) Applicants for 40,000 shares received in full.
(b) Applicants for 15,000 shares received on allotment of 8,000 shares.
(c) Applicants for 5000 shares received on allotment of2,000 shares, excess money being returned.
All amounts due on allotment were received.
The first call was duly made and the money received with the exception of the call due on 100 shares.
Give journal and cash book entries to record these transactions of the company. [2]
Answer:
Question 11.
Anirudh Ltd. has 4,000, 8% debentures of? 100 each due for redemption on March, 31, 2017. The company has a debenture redemption reserve of ₹ 50,000 on that date. Assuming that no interest is due, record the necessary journal entries at the time of redemption of debentures. [2]
Answer:
Question 12.
X Ltd. was to redeem 8,000,10% debentures of ₹ 100 each on April 1, 2017, at a premium of 5%. The company has a surplus of ₹ 9,00,000 in the statement of profit and loss. The company closes its books on December 31 every year. What journal entries the company will be recording to redeem the above debentures? [2]
Answer:
Question 13.
The following balances are taken from trial balance of a company :
Loan from IDBI ₹ 5,00,000; Land and Building ₹ 3,70,000; Plant and Machinery ₹ 2,58,000; Furniture ₹ 45,000; Investments ₹ 2,47,000; Dr. Balance of P & L Statement ₹ 50,000; Trade Receivables ₹ 2,25,000; Inventory ₹ 1,75,000; Cash and Cash Equivalents ₹ 51,000. You are requirea to draw up assets side of Balance Sheet as per Companies Act, 2013. [2]
Answer:
Question 14.
From the following particulars obtained from the books of Mark Ltd, prepare a Comparative Statement of Profit and Loss: [2]
Particulars | Note No. | 2017-18 (₹) | 2016-17 (₹) |
Revenue from operations | 50,00,000 | 40,00,000 | |
Purchase of Stock-in-trade | 40,00,000 | 30,00,000 | |
Changes in inventory | 10,00,000 | 8,00,000 | |
Other expenses | 5,00,000 | 4,00,000 | |
Other income | 2,50,000 | 2,00,000 |
Answer:
Question 15.
Calculate Inventory Turnover Ratio from the data given below: [2]
Inventory in the beginning of the year | ₹10,000 |
Inventory at the end of the year | ₹5,000 |
Carriage | ₹2,500 |
Revenue from Operations | ₹ 50,000 |
Purchases | ₹ 25,000 |
Answer:
Inventory Turnover Ratio = \(\frac{\text { Cost of Goods Sold }}{\text { Average Inventory }}\)
Cost of Goods Sold = Openint Inventory + Purchases + Carriage – Closing Inventory
= ₹ (10,000+25,000+2,500 – 5,000)
= ₹(37,000 – 5,000)
= ₹ 32,500
Average Inventory = \(\frac{\text { Opening Inventory + Closing Inventory }}{2}\)
= \(\frac{10,000+5,000}{2}\)
= \(\frac{15,000}{2}\) = ₹ 7,500
Inventory Turnover Iatio = \(\frac{32,500}{7,500}\)
=4.33:1 or 4.33 times
Question 16.
A trading firm’s average inventory is ₹ 20,000 (cost). If the inventory tumover ratio is 8 times and the firm sells goods at a gross profit of 20% on sales, ascertain the gross profit
of the firm. [2]
Answer:
Inventory Turnover Ratio = \(\frac{\text { Cost of Goods Sold }}{\text { AverageInventory }} \)
8 = \(\frac{\text { Cost of Goods Sold }}{20,000} \)
Cost of Goods Sold = ₹(20,000 x 8)
= ₹ 1,60,000
Sales = \(\frac{1,60,000 \times 100}{(100-20)}\)
= \(\frac{1,60,000 \times 100}{80}\) = ₹ 2,00,000
Gross Profit = Sales – Cost of Goods Sold
= ₹ (2,00,000 – 1,60000) = ₹ 40,000
Section-C
Question 17.
From the following receipts and payments and information given below, prepare Income and Expenditure account and opening Balance Sheet of Adult Literacy organisation as on December 31, 2017. [3]
Information:
(i) Subscriptions outstanding as on 31.12.2016 were ₹ 2,000 and on December 31, 2017, were ₹ 1,500.
(ii) On December 31, 2017, Salary outstanding was ₹ 600, and one month’s rent paid in advance.
(iii) On Jan. 01, 2016 organization owned furniture ₹ 12,000 and Books ₹ 5,000.
Answer:
Question 18.
Azad and Benny are equal partners. Their fixed capitals are ₹ 40,000 and ₹ 80,000, respectively. After the accounts for the year have been prepared, it is discovered that interest at 5% p.a. as provided in the partnership agreement, has not been credited to the capital accounts before the distribution of profits. It is decided to make an adjustment entry at the beginning of the next year. Record the necessary journal entry. [3]
Answer:
Working Notes:
(1) Interest on Capital:
Azad = \(₹ 40,000 \times \frac{5}{100}\) = ₹ 2,000
Benny = \(₹ 80,000 \times \frac{5}{100} \) = ₹ 4,000
Question 19.
Asha, Rina, and Chahat were partners in a firm sharing profits and losses in the ratio of 2:2:1 Their balance sheet as at 31st March 2019 was as follows :
Balance Sheet of Asha, Rina and Chahat as at 31st March 2019
Asha, Rina, and Chahat decided to share future profits equally with effect from 1st April, 2019. For this, it was agreed that:
(i) Goodwill of the firm be valued at ₹ 1,50,000.
(ii) Bad debts amounted to ₹ 40,000. A provision for doubtful debts was to be made @ 5% on debtors.
Pass the necessary journal entries to record the above transactions in the books of the firm. [3]
Answer:
Question 20.
Calculate the amount of opening trade receivables and closing trade receivables from the following information:
Trade Receivables Turnover Ratio 8 times
Cost of Revenue from Operations ₹ 4,80,000
The amount of credit revenue from operations is ₹ 2,00,000 more than cash revenue from operations. Gross profit ratio is 20%. Opening trade receivables are 174 th of Closing trade receivables. [3]
Answer:
Trade Receivables Turnover Ratio = \(\frac{\text { Credit Revenue from Operations }}{\text { Average Trade Receivables }}\)
Cost of Revenue from Operations = 4,80,000
Gross Profit = \(\frac{1}{4}\) x ₹ 4,80,000
= ₹ 1,20,000
Revenue from Operations = Cost of Revenue from Operations + Gross profit
= ₹ 4,80,000 + 1,20,00
= ₹ 6,00,000
Revenue from Operations = Cash Revenue from Operations + Credit Revenue from Operations
6,00,000 = Cash Revenue from Operation +(₹ 2,00,000 + Cash Revenue from Operations)
Cash Revenue from Operations = ₹ 2,00,000
Credit Revenue from Operations = ₹ 4,00,000
Trade Receivables Turnover Ratio = \(\frac{\text { Credit Revenue from Operations }}{\text { Average Trade Receivables }} \)
8 = \(\frac{4,00,000}{\text { Average Trade Receivables }}\)
Average Trade Receivables = ₹ 50,000
50,000 = \(\frac{\text { Opening Trade Receivables + Closing Trade Receivables }}{2} \)
50,000 = \(\frac{(1 / 4 \text { Closing Trade Receivables }+\text { Closing Trade Receivables })}{2}\)
Closing Trade Receivables =₹ 80,000
Opening Trade Receivables = ₹ 20,000
Section-D
Question 21.
C and D are partners in a firm sharing profits in the ratio of 4 :1. On 31.3.2016, their balance sheet was as follows :
Balance Sheet of C and D As on 31.3.2016
On the above date, E was admitted for 1/4th share in the profits on the following terms:
(i) E will bring ₹ 1,00,000 as his capital and ₹ 20,000 for his share of goodwill premium, half of which will be withdrawn by C and D.
(ii) Debtors ₹ 2,000 will be written off as bad debts and a provision of 4% will be created on debtors for bad and doubtful debts.
(iii) Stock will be reduced by ₹ 2,000, furniture will be depreciated by ₹ 4,000 and 10% depreciation will be charged on plant and machinery.
(iv) Investments of ₹ 7,000 not shown in the balance sheet will be taken into account.
(v) There was an outstanding repairs bill of ₹ 2,300 which will be recorded in the books.
Pass necessary journal entries for the above transactions in the books of the firm on E’s admission. [4]
Or
Azad and Babli are partners in a firm sharing profits and losses in the ratio of 2: 1. Chintan is admitted into the firm with 1/4 share in profits. Chintan will bring in ₹ 30,000 as his capital and the capitals of Azad and Babli are to be adjusted in the profit-sharing ratio. The Balance sheet of Azad and Babli as on March 31, 2016 (before Chintan’s admission) was as follows :
It was agreed that:
(i) Chintan will bring in ₹ 12,000 as his share of goodwill premium.
(ii) Buildings were valued at ₹ 45,000 and Machinery at ₹ 23,000.
(iii) A provision for doubtful debts is to be created @ 6% on debtors.
(iv) The capital accounts of Azad and Babli are to be adjusted by opening current accounts.
Record necessary journal entries, show necessary ledger accounts, and prepare the Balance sheet after admission of Chintan. [4]
Answer:
Question 22.
Life Machine Tools Limited issued 50,000 equity shares of ₹ 10 each at ₹ 12 per share payable at ₹ 5 on application (including premium), ₹ 4 on allotment and the balance on the first and final call. Applications for 70,000 shares had been received. Of the cash received, ₹ 40,000 was returned and ₹ 60,000 was applied to the amount due on allotment. All shareholders paid the call due, with the exception of one shareholder of 500 shares. These shares were forfeited and reissued as fully paid at ₹ 8per share. Journalise the transactions. [4]
Answer:
Question 23.
Madhur Ltd. has outstanding 9% debentures of ₹ 50,00,000 redeemable at par on January 01, 2020. Debenture Redemption Reserve of ₹ 2,00,000 on March 31.2019. and balance of required amount of DRR was created on March 31, 2019.
The company invested in specified securities (DRI) the required amount on April 01, 2019 Debentures were redeemed on the due date. Record necessary journal entries in the books of the company and also prepare the ledger accounts [ignore interest]. [4]
Or
X Ltd. has 4,000 12% debentures of? 100 each on 1st April 2018. According to the terms of issue, interest on debentures is payable half-yearly on 30th September and 31st March, and the rate of tax deducted at source is 10%.
Pass necessary journal entries for interest on debentures for the year 2018-19. [4]
Answer:
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