NORTHWEST ACCREDITATION COMMISSION, USA

HIGH SCHOOL DIPLOMA (Sr. Secondary/12TH)

ACCOUNTANCY
ASSIGNMENT

Note : Do this assignment in the Subject Register.

Question 1. Nithya, Sathya and Mithya were partners sharing profits and losses in the
ratio of 5:3:2. Their Balance Sheet as on December 31, 2002 was as follows:
Balance Sheet
As on March 31, 2002

Liabilities Amount (In Assets Amount (In

Rs.) Rs.)
Creditors 1,14,000 Investment 10,000
Reserve fund 6,000 Goodwill 5,000
Capitals Premises 20,000
Nithya 30,000 Patents 6,000
Sathya 30,000 Machinery 30,000
Mithya 20,000 80,000 Stock 13,000
Debtors 8,000
Bank 8,000
1,00,000 1,00,000

Mithya dies on May 1, 2002. The agreement between the executors of

Mithya and the partners stated that:
(a) Goodwill of the firm be valued at 2.1/2 times the average profits of last
four years. The profits of four years were: in 1998, Rs.13,000; in 1999,
Rs.12,000; in 2000, Rs.16,000; and in 2001, Rs.15,000.
(b) The patents are to be valued at Rs.8,000, Machinery at Rs.25,000 and
Premises at Rs.25,000.
(c) The share of profit of Mithya should be calculated on the basis of the
profit of 2002.
(d) Rs.4,200 should be paid immediately and the balance should be paid in 4
equal half-yearly instalments carrying interest @ 10%.
Record the necessary journal entries to give effect to the above and write the
executor’s account till the amount is fully paid. Also prepare the Balance
Sheet of Nithya and Sathya as it would appear on May 1, 2002 after giving
effect to the adjustments

Question 2. Journalise the following transaction in the books Bhushan Oil Ltd:
(a) 200 shares of Rs.100 each issued at a discount of Rs.10 were forfeited for
the non payment of allotment money of Rs.50 per share. The first and final
call of Rs.20 per share on these share were not made. The forfeited share
were reissued at Rs.70 per share as fully paid-up.
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(b) 150 shares of Rs.10 each issued at a premium of Rs.4 per share payable
with allotment were forfeited for non-payment of allotment money of Rs.8
per share including premium. The first and final call of Rs. 4 per share were
not made. The forfeited share were reissued at Rs.15 per share fully paid-up.
(c) 400 share of Rs.50 each issued at par were forfeited for non-payment of
final call of Rs.10 per share. These share were reissued at Rs.45 per share
fully paid-up.

Question 3. Pass the necessary Journal entries for the following transactions on the
dissolution of the firm of P and Q after the various assets (other than cash)
and outside liabilities have been transferred to Realization Account.

(a) Bank Loan Rs. 12,000 was paid.

(b) Stock worth Rs. 16,000 was taken over by partner Q.
(c) Partner P paid a creditor Rs. 4,000.
(d) An asset not appearing in the books of accounts realized Rs. 1,200.
(e) Expenses of realization Rs. 2,000 were paid by partner Q.
(f) Profit on realization Rs. 36,000 was distributed between P and Q in 5:4
ratio.

E and F were partners in a firm sharing profits in the ratio of 3:1. They
admitted G as a new partner on 1.3.2005 for 1/3 share. It was decided that B,
F and G will share future profits equally. G brought Rs. 50,000 in cash and
machinery worth Rs. 70,000 for his share of profit as premium for goodwill.
Showing your calculations clearly and pass the necessary journal entries in
the books of the firm.

Question 4. Ashish and Dutta were partners in a firm sharing profits in 3:2 ratio. On Jan.
01, 2007 they admitted Vimal for 1/5 share in the profits. The Balance Sheet
of Ashish and Dutta as on Jan. 01, 2007 was as follows:
Balance Sheet of A and B
As on 1.1.2007

Liabilities Amount (In Assets Amount (In

Rs.) Rs.)

Creditors 15,000 Land and Building 35,000

Bills Payable 10,000 Plant 45,000
Ashish’s Capital 80,000 Debtors 22,000
Dutta’s Capital 35,000 (-) Provision (2,000) 20,000
Stock 35,000
Cash 5,000
1,40,000 1,40,000

It was agreed that:

(a) The value of Land and Building be increased by Rs. 15,000.
(b) The value of plant be increased by 10,000.
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(c) Goodwill of the firm be valued at Rs. 20,000.

(d) Vimal to bring in capital to the extent of 1/5th of the total capital of the
new firm.
Record the necessary journal entries and prepare the Balance Sheet of the
firm after Vimal’s admission.

Question 5. From the following information calculate

(a) Gross Profit Ratio
(b) Inventory Turnover Ratio
(c) Current Ratio
(d) Liquid Ratio
(e) Net Profit Ratio
(f) Working Capital Ratio

Items Amount (In

Rs.)
Sales 25,20,000
Net Profit 3,60,000
Cost of Sales 19,20,000
Long Term Debts 9,00,000
Creditors 2,00,000
Average Inventory 8,00,000
Current Assets 7,60,000
Fixed Assets 14,40,000
Current Liabilities 6,00,000
Net Profit before Interest
and Tax 8,00,000

Question 6. The Balance Sheets of Kewal Ltd. as on 31st December, 2006 and 31st
December, 2007 were as follows:

Liabilities 31.12.07 31.12.06 Assets 31.12.07 31.12.06

Rs. Rs. Rs. Rs.
Share Capital 10,00,000 7,00,000 Plant and
P/L Account 2,50,000 1,50,000 Machinery 8,00,000 5,00,000
Proposed Stock 1,00,000 75,000
Dividend 50,000 40,000
Cash 4,00,000 3,15,000
13,00,000 8,90,000 13,00,000 8,90,000

Additional Information:-
(a) Rs. 50,000 depreciation has been charged to Plant and Machinery during
the year 2007.
(b) A Piece of machinery costing Rs.12,000 (book value Rs. 5,000) was sold at
60% profit on book value.
Prepare Cash Flow Statement.

Question 7. Ram and Shyam were partners In a firm sharing profits in the ratio of 2:3.
Their Balance Sheet as on 31.1.2005 was as follows:
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Liabilities Amount Rs. Assets Amount

Rs.
Creditors 1,30,000 Land and building 2,40,000
Bills Payable 70,000 Machinery 1,30,000
Capital Accounts: Goodwill 20,000
Ram 1,50,000 Stock 50,000
Shyam 1,50,000 3,00,000 Debtors 40,000
________ cash 20,000
5,00,000 5,00,000

On the above date the firm was dissolved. Ram paid the creditors at a
discount of 10% and Shyam paid bills payable in full. Assets realised: Land and
Building 20% less; Machinery Rs. 70,000; Stock 25% less; Debtors Rs. 25,000.
Expenses of realisation paid by Shyam were Rs. 3,500.

Prepare Realisation Account, Cash Account and Capital Accounts of the

partners to close the books of the firm

Question 8. From the following extract of Receipts and Payments Account of Sonic club
and the given additional information, show the Salaries items in the Income
and Expenditure Account for the year ending 31st Dec. 2006 and the Balance
Sheet as on 31st December, 2005 and 31st December, 2006.

An Extract of Receipts and Payments Account

for the year ending 31st December, 2006

Receipts Rs. Payment Rs.

By Salaries
2005 20,000
2006 2,80,000
2007 18,000

Additional Information: Rs.

(a) Salaries outstanding on 31.12.2005 25,000

(b) Salaries outstanding on 31.12.2006 45,000
(c) Salaries paid in advance on 31.12.2005 10,000