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Financial Accounting Question Bank
Financial Accounting Question Bank
Red to Blue Rs. 778 and to Green Rs. 13358, ladies wear to tailoring Rs.10,630.
Green to Red Rs.8,542 and to Blue Rs.11,602.
Apportion equally, stationery Rs. 1,842. Postage Rs. 1,326, general charge Rs. 79,254,
insurance Rs. 3,570 and depreciation Rs. 10,920.
23. Hari company ltd opened a branch at Madres in 1 st January 2013.From the following
particulars prepare the necessary account for 2014 in the books of the head office.
Particulars Rs
Salaries 2,400
Rent 720
Telephone 200
24. Bombay Soap Mills Ltd opened a branch at Bombay on 1st January 2008. From the
following particulars prepare the necessary accounts for 2008 and 2009 in the books of the
head office.
26. A Partner makes Drawings of Rs.5,000 p.m. under the partnership deed. Interest is to be
charged at 10% p.a. what is the interest that should be charged to the partner, if the amount
was withdrawn. a) In the beginning of the month. b) In the middle of the month and c) At the
end of the month.
27. A, B and C are in partnership sharing profit and losses in the ratio of 9:6:5. Their balance
sheet stood as follows:
Liabilities Rs Assets Rs
Capital account
A 20,000
B 20,000
C 15,000
80,000 80,000
C retires and a revaluation loss of Rs. 2,000 is visualized. The goodwill of the firm is Rs.
20,000 and the remaining partners A and B pay for the share of goodwill due to C so as to
keep the goodwill as a secret reserve. Write up the capital account of the outgoing partner C
and transfer it to C’s loss account.
28. L and H were carrying on the business as equal partners. It was agreed that L should retire
from the firm on 31.3.1992 and his son ‘C’ should join the firm on 1.4.1992 and should be
entitled to ½ of the profits. The balance sheet on 31.3.1992 was as follows:
Liabilities Rs Assets Rs
Capital Cash at bank 20,000
Accounts:
L 64,000 Sundry debtors 33,800
H 60,000 Furniture 10,200
Sundry 20,000 Building 60,000
Liabilities
Goodwill 20,000
1,44,000 1,44,000
It was also agreed that enough money should be introduced to enable ‘L’ to be paid
out and leave Rs. 20,000 cash by way of working capital.
H and C were to provide such sum as would make their capitals proportionate to
their share of profits.
‘L’ agreed to give a gift to ‘C’ by transfer from his capital account of half the
amount which C had to provide.
H and C paid due from them in cash on 7.4.92 and the amount due to L was paid
out on the same day.
Prepare the necessary accounts and balance sheet.
29. Explain the settlement procedure between partners after dissolution of firm?
PART-D
31. From the under mentioned information instruction prepare departmental trading and profit
and loss account in columnar form of the three departments of outfitters Ltd.,
Tailoring to ladies wears Rs. 389 and to out fitting Rs. 6679, ladies wear to tailoring Rs.5315,
Apportion equally, stationery Rs. 921. Postage Rs. 663, general charge Rs. 39,627, insurance
Rs. 1,785 and depreciation Rs. 5,460
32. Sridhar & sons has two departments: Cloth and Readymade. Readymade Clothes are
manufactured by the firm itself out of cloth supplied by the cloth department its usual selling
rate. From the following figures, prepare departmental trading and profit and loss a/c and
general p&l a/c for the year ending 31.12.91
Cloth dept Readymade
dept Rs
Rs
1. General expenses incurred for both the departments were Rs. 1,20,000.
2. The stock in the readymade department may be considered as consisting of 66 2/3 %
cloth and 33 1/3 % other expenses.
The cloth department earned profit at the rate of 18% in 1990
Rs
36. A and B started business on 1st January 1995. They contributed Rs. 1,60,000 and Rs.
1,20,000 respectively as their capitals. The terms of the partnership agreements are as
follows:
a) Interest on capital and drawings @ 12% per annum.
b) A and B to get a monthly salary of Rs.4,000 and Rs.6,000 respectively.
c) Sharing of profit or loss will be in the ratio of their capital contribution.
The profit for the year ended 31 st December 1995, before making above appropriation was
Rs. 2,00,600. The drawings of A and B were Rs. 80,000 and Rs. 1,00,000 respectively.
Prepare profit and loss appropriation a/c and partner’s capital accounts assuming that their
capitals are fluctuating.
37. L and H were carrying on the business as equal partners. It was agreed that L should retire
from the firm on 31.3.1992 and his son ‘C’ should join the firm on 1.4.1992 and should be
entitled to ½ of the profits. The balance sheet on 31.3.1992 was as follows:
Liabilities Rs Assets Rs
Capital Cash at bank 20,000
Accounts:
L 64,000 Sundry debtors 33,800
H 60,000 Furniture 10,200
Sundry 20,000 Building 60,000
Liabilities
Goodwill 20,000
1,44,000 1,44,000
It was also agreed that enough money should be introduced to enable ‘L’ to be paid
out and leave Rs. 20,000 cash by way of working capital.
H and C were to provide such sum as would make their capitals proportionate to
their share of profits.
‘L’ agreed to give a gift to ‘C’ by transfer from his capital account of half the
amount which C had to provide.
H and C paid due from them in cash on 7.4.92 and the amount due to L was paid
out on the same day.
Prepare the necessary accounts and balance sheet.
38. On 31.12.90 the balance sheet of Madan, Mohan and Madhu showed as under:
Liabilities Rs Assets Rs
Capital Cash 6,000
Accounts:
Madan 45,000 Stock 36,000
The Mohan 30,000 Bills 18,000 partnership
deed receivable provides
that the Madhu 30,000 Debtors 45,000 profit be
shared in General Reserve 48,000 Investment 45,000 2:1:1 and
that in the Sundry creditors 45,000 Building 48,000 event of
death of a 1,98,000 1,98,000 partner, his
executors are entitled
to be paid out.
Madhu died on 1.4.91. He has withdrawn Rs. 12,000 to the date of his death. The
investment was sold at par and madhu’s executors were paid off. Pass the journal entries and
show Madhu’s capital.
39. Kannan, Murali and Ravi share profits in the ratio of 3:2:1. They decided to dissolve the
firm on 31.12.92 on which date their balance sheet was us under.
Liabilities Rs Assets Rs
Creditors 37,000 Bank 10,840
Mrs. Kannan 20,000 Investment 41,660
Life policy fund 28,000 Stock 15,100
Investment fluctuation fund 12,000 Debtors 18,600
Capital : kannan 80,000 (-) provision 1,200 17,400
Murali 40,000 Plant & machinery 81,000
Capital a/c Ravi 23,000
Joint life policy 28,000
2,17,000 2,17,000
Kannan agrees to discharge his wife’s loan.
Murali takes over all the stock at Rs. 14,000 and debtors amounting to Rs. 10,000 at
Rs. 8,000.
The investments are taken over by kannan for Rs.35,000.
The life policy is surrendered for Rs. 24,000.
Machinery is sold for Rs.1,10,000. The remaining debtors realize 50% of book is with
Rs. 6,000.
The same is taken over by one of the creditors at this value.
The realization expenses amount to Rs. 1,200.
Show the necessary ledger accounts, on completion
40. The following is the balance sheet of Anbu and Babu on 31.12.92
Liabilities Rs Assets Rs
Capital: Buildings 15,000
Anbu 10,000
Babu 10,000 Plant & machinery 20,000
General Reserve 10,000 Goodwill 4,000
Investment fluctuation fund 1,000 Investment 10,000
Mrs. Anbu’s loan 5,000 Stock 5,000
Mrs. Babu’s loan 10,000 Cash at bank 8,500
Bills payable 8,000 Debtors 20,000
Sundry creditors 30,000 (-) provision 2,000 18,000
P&L a/c 3,500
84,000 84,000
It was agreed to dissolve the partnership as on 31.12.92 and the term of dissolution were:
Anbu promised to pay off Mrs. Anbu’s loan and took away stock at Rs. 4,000