1885/PZA -FINANCIAL ACCOUNTING; B.com

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                                                                                                      FINANCIAL ACCOUNTING

SECTION A — (5 × 8 = 40 marks)
Answer any FIVE questions.
All questions carry equal marks.
1. Explain the accounting concepts in detail.

2. Explain the types of errors.

3. A owes B the following sums of money due on the dates stated :
Rs. 400 due on 5th
Jan. 2000
Rs. 200 due on 20th
Jan. 2000
Rs. 800 due on 24th
Jan. 2000
Rs. 100 due on 26th
Feb. 2000
Rs. 50 due on 10th
Mar. 2000.
Find out average due date.

4. Anand purchased a machine under hire purchase system.
Accounting to the terms of the agreement of Rs. 40,000 was to be
paid on signing of the contract. The balance was to be paid in
four annual instalments of Rs. 25,000 each plus interest. The
cash price was Rs. 1,40,000.  Interest is chargeable on
outstanding balance at 20% p.a. Calculate interest for each year
and the instalment amount.

5. The following balances are extracted from the books of Ramesh.
You are required to prepare the Trial balance as on 31.3.2009.
Particulars Amount Particulars  Amount
(Rs.)  (Rs.)
Purchases 20,000 Miscellaneous income 400
Purchase returns 800 Bills payable 7,000
Sales 30,000 Bill receivable 11,000
Sales returns 1,000 Cash-in-hand 1,800
Capital 30,000 Sundry creditors 4,000
Interest (Dr) 400 Discount earned 800
Wages 7,000 Sundry debtors 15,000
Rent 800 Commission (Dr) 1,000
Telephone charges 1,000 Plant and Machinery 8,000
Cash at Bank 6,000

6. Ravi Bros. operate a retail branch at Delhi. All purchases are
made by the Head office at Madras goods being charged out to
the branch at cost price. All cash received by the  branch is
remitted to Madras Branch petty expenses are paid out of an
interest which is reimbursed by the head office from time to
time. From the following particulars relating to Delhi branch.
You are required to prepare branch account in the books of the
Head office. 3 U/ID 1885/PZA
(Rs.) (Rs.)
Jan. 1, 1983 stock at cost 8,000 Petty exps paid by the 
Petty cash 800 branch out of interest 700
Plant 10,000 Cash sales during the
Dec. 31, 1983 stock on cost 7,000 year sale of plant 
Goods sent to branch 50,000 on July 1, 1983 70,000
(Book value of the plant
on the date of sale 
Rs. 900) 800
Exps. paid by the 
H.O. 5,000
It is required to write off plant at 20% p.a.

7. Show how the following items will appear in the  capital a/c. of
the partner Ramesh & Raju when their capital are fixed.
Ramesh Raju
(Rs.)  (Rs.)
Capital as on 1.1.2006 3,200 2,800
Drawings during, 2006 6,400 5,600
Interest at 5% on drawings 160 50
Share of profits for 2006 3,360 2,640
Interest on capital at 6% 1,920 1,680
Salary 2,800

8. X, Y, Z share profits of a firm is the ratio
4
1
:
4
1
:
2
1
respectively.
On the date of dissolution their balance sheet as follows:
Liabilities Rs. Assets Rs.
Creditors 10,000 Sundry assets 60,000
X's Loan 5,000 Cash-in-hand 1,000
Y's Loan 3,000
X's Capital 20,000
Y's Capital 15,000
T's Capital 8,000
61,000 61,000
  The assets realised Rs. 45,000  which were received in
instalments of Rs. 15,000, Rs. 16,000 and Rs.14,000. Show
how proceeds should be distributed as and when required
by the following the proportionate capital method.

SECTION B — (3 × 20 = 60 marks)
Answer any THREE questions.
All questions carry equal marks.
9. The following are the Balances extracted from the books at
Thiru. Muruga as on 31.12.2006. Prepare Trading and Profit and
Loss a/c. for the year ended 31st
Dec. 2006 and a balance sheet as
on the date.
Debit balance Rs. Credit balance Rs.
Opening stock 20,000 Capital  1,00,000
Machinery 40,000 Purchase returns 1,000
Purchases 70,000 Sales 90,000
Sales Returns 1,000 Creditors 29,000
Wages 2,000
Salaries 5,000
Office rent 2,000
Insurance 1,000
Debtors 50,000
Cash 4,000
Bank 25,000
2,20,000 2,20,000
Adjustments :
(a) Closing stock is valued at Rs. 20,000
(b) Outstanding salaries Rs. 1,000
(c) Prepaid insurance Rs. 500
(d) Bad debts Rs. 1,000
(e) Provide 10% Depreciation on machinery.

10. Vijay and Ragavan are equal partners in a business in which the
books are kept by single entry.
Their position on 1.7.2005 was as under :
Liabilities  Rs. Assets Rs.
Bills payable 12,400 Cash in hand 540
Sundry creditors 40,000 Cash at bank 27,760
Capital a/c :  Bills receivable 9,200
Vijay -     1,60,000 Sundry debtors 97,300
Ragavan 1,60,000 3,20,000 Stock 67,600
Plant and Machinery 1,60,000
Furniture 10,000
3,72,400 3,72,400
On 30.6.2006 the following was the statement of affairs.
(Rs.) (Rs.)
Cash-in-hand 800 Cash at bank 31,600
Sundry creditors 42,400 Stock 73,400
Sundry debtors 1,32,600 Bills payable 1,200
Bills receivables 17,600
Plant and Machinery and Furniture are to be depreciated by
10% . Drawings : Vijay - Rs. 20,000 and Ragavan Rs. 16,000.
Ascertain the profit for the year ended 30.6.2006 and statement
of affairs as on the that date. Prepare capital accounts of
partners.

11. The  following is the baalance sheet of Ram and Ravi Showing
profit and losses as to Ram 60% and Ravi 40% as to
1st
May, 2007.
Liabilities Rs. Assets Rs.
Creditors 25,000 Cash 2,000
Bank OD 13,000 Debtors 30,000
P and L a/c. 14,000 Stock 20,000
Capital :  Furniture 8,000
Ram -  40,000 L and Building 50,000
Ravi -  30,000 70,000 Goodwill 12,000
1,22,000 1,22,0008 U/ID 1885/PZA
They agree to take Rajiv into the partnership to 1/10th
share on
the following terms :
(a) That the shall bring in a capital of Rs. 30,000
(b) That the goodwill of the firm be increased to Rs. 15,000
(c) That the provision of Rs. 1,000 be made for outstanding
repairs bills
(d) That the value of land and buildings be brought upto 
Rs. 60,000 being their present worth.
  Pass the necessary journal entries and prepare the balance
sheet of the new firm.

12. Mumbai Transport Ltd. purchased from Delhi motors three
buses costing Rs. 20,000 each. Hire purchase system. Payment
was to be made Rs. 15,000 down and the remainder in three
equal instalments together with interest at 5%. Mumbai
transport writes of depreciates @ 20% on the straight line
method it paid the instalment at the end of the first year but
could not pay the next.
Give the necessary ledger accounts the books of both parties for
two years if the hire vendor book possession of all the three
busses. The hire vendor spent Rs. 5,800 on getting the busses.
Throughly overhawled and sold them for Rs. 50,000. 9 U/ID 1885/PZA

13. Ajay, Arun and Ananth share profits in the ratio at 3:2:1 on
31.12.2006 their balance sheet was as follows :
Liabilities Amount
Rs.
Assets Amount
Rs.
Creditors 24,000 Machinery 50,000
General Reserve 6,000 Stock 22,000
Capital :  Debtors 19,000
Ajay -     40,000  Goodwill 26,000
Arun -    30,000  Cash 3,000
Ananth - 20,000 90,000
1,20,000 1,20,000
On the above date, the firm was dissolved. The assets except
cash realised Rs. 1,20,000. The creditors were settled at 
Rs. 23,000. Dissolution expenses amounted to Rs. 1,600. Give
necessary ledger accounts.