Answers to Sample Paper 6 1. (a) (A) is correct but (R) is wrong. 2. (d) Only Statements (ii) and (fii) are correct. 3. (©) © 6,00,000 [8 20,00,000 ~ & 14,00,000] (b) Shibu & 24,400 ; Bishu & 17,200 4 150 fers! or (6) Dr. Jyoti’s Capital A’e and Cr. Tapan’s Capital Ale by & 700. 5. (b) 9% pa 6. (b) % 250 or (©) % 6,00,000 from Statement of Profit & Loss 7. (b) 11:76 8. (c) Profit and Loss Suspense A/e Or (b) Realisation Afe Dr. 90,000 To Bank Ale 90,000 9. (a) % 2,100 10, (6) Credited with & 1,600 1. (6) % 15,000 12. (6) | Date Particulars LE | De® ce ®) Securities Premium Ale Dr. 3,40,000 Statement of Profit & Loss Dr. 700,000 To Loss on Issue of Debentures Ale 10,40,000 13. (6) % 1,000 14, (b) Dr. Y's Capital Ale and Cr. X’s Capital A/e by & 18,000 15. (c) Credited to Capital Reserve Account or (a) % 30,000 16. (a) % 90,000 EAD Accountancy—12 017. 18, Journal Date Particulars LE Dr ® ce ® (| Stock Ave Dr, 8,000 Building A/c Dr, 20,000 Debtors Ale Dr. 12,000 Cash Ale (Bal. Fig.) Dr, 14,000 To Premium for Goodwill Ale 4,000 ‘To Mahesh’s Capital A/c 50,000 (Being Mahesh admitted as a new partner and brought assets and cash) (i) | Premium for Goodwill Ale Dr, 4,000 To Mayank’s Capital Ale 2,000 To Manik Capital Ae 2,000 (Being premium divided between sacrificing partners) (iii) | General Reserve Ale 16,000 To Mayank’s Capital Ale 8,000 ‘To Manik’s Capital Ale 8,000 (Being general reserve divided between old partners) Journal Date Particulars LE Dr. @ Cr @ (| Incorporation Expenses Ale Dr, 2,00,000 To Promotors’ Ae 2,00,000 (Being amount due to promotors) (i) | Promotors’ Ale Dr, 2,00,000 To Share Capital Ae 2,00,000 (Being issue of 2,000 shares of € 100 each) (iii) | Underwriting Commission Ale Dr, 3,00,000 To underwriters’ Ale 3,00,000 (Being amount due to underwriters) (@) | Underwriters’ Ave Dr. 3,00,000 To Share Capital Ale (Being issue of 3000 shares of 100 each ) 3,00,000 EAD Accountaney—12 @19, or Journal Date Particulars LE Dr. @ Cr @) Land Ale Dr. 12,00,000, Plant Ale Dr. 7,40,000 Stock Ale Dr, 6,00,000 Furniture Ale Dr. 60,000 To Capital Reserve A/c 3,30,000 ‘To Bills Payable Afe 6,70,000 To TP Lid, 20,00,000 (Being purchase of assets and liabilities from TP Ltd.) TP Led. Dr. 20,00,000 ‘To Bank Ale 4,00,000 ‘To Bills Payable Ae 5,00,000 To Equity Share Capital Ale 10,00,000 ‘To Securities Premium Alc 1,00,000 (Being consideration paid by bank draft, bill of exchange and by issuing 10,000 equity shares of % 100 each issued at premium of € 10 each) Journal Date Particulars LE Dr @ cr ® Astha’s Capital Ae Dr. 2,950 Asha's Capital Ale Dr 16450 To Atharva’s Capital Ale 19,400 (Being interest on capital and drawings omitted, now adjusted) Statements showing Adjustments Particu Atharva @ | Astha @) | Asha @) Interest on Capital 9,600 7,200 6400 Salary - —| 7,200 Interest on Drawings 350} 250) (100) Net Divisible Profit & 150,000 + & 700 ~ & 23,200 - & 7,200 = & 1,20,300 in 3: 2:1 60,150] 40,100] 20,050 Net amount to be re 69,400 Cr.] 47,050 Cr. | 33,550 Cr, eived (Cr.) Amount already Received (Dr.) (1,50,000 in 3: 2: 1) 50,000 Dr. | 50,000 Dr. 50,000 Dr. 19,900 Cr.| 2,850 Dr 16,450 Dr. EAD Accountancy—12 @20. 24. Or Dr. Profit and Loss Appropriation A/c Cr. Particulars ‘Amount @) Particulars ‘Amount @. ‘To Interest on Capital By Profit and Loss Alc (Net Profit) 1,80,000 Ashish 7,200 By Interest on drawings Ayush 5,600 Ashish 300 Piyush 4,800 17,600] Ayush 300 ‘To Salary (Piyush) 12,000] Piyush 300 900 ‘To Profit transferred to: Ashish 96,520 Ayush 0,520 Piyush 30,260 | 151,300 1,80,900 1,80,900 Revaluation A/e Particul ‘Amount @) Particulars ‘Amount @ ‘To Plant 4,800 | By Loss transferred to: (Bal. Fig.) To Creditors 2,000) x 10533 To Bad Debts Y 67 To Furniture 4,500 15,800 15,800 15,800 Journal entry for loss: X’s Capital Ale Dr. Y's Capital Afe Dr. To Revaluation Alc 15,800 (Being loss on revaluation transferred to X and Y) Balance Sheet (Extract) Particulars Note No. | Amount @ LIABILITIES 1. Shareholders’ Fund a, Share Capital 27,88,000 Note No. Particulars, ‘Amount @), 1 Share Authorised Capital 50,000 Equity Shares @ © 100 each, Issued Capital 40,000 Shares @ & 100 each Subscribed Capital Subscribed but not fully paid up 40,000 Shares @ % 100 each, & 70 called up Less: Calls in Arrears Ae 50,00,000 40,00,000 28,00,000 12,000 27,88,000 EAD Accountaney—12 “2. 23. Journal Date Particulars LE Dr. @) Cr @) (| Bank/Cash Ave Dr. 18,000 To Realisation Ale 18,000 (Being payment received from creditors for excess amount) (i) | Realisation Dr. 33,000 To Bank/Cash Ale (Being payment made to creditors) Gi) [No Entry Required () | BankjCash Ale Dr. 18,000 To Realisation Ale 18,000 (Being cash received from Sumit, a partner for unrecorded asset) Journal of Hariom Ltd. Date Particulars LE Dr. @) cr @) (| Bank Ave Dr. 360,000 ‘To Equity Share Application Ale 3,60,000 (Being application money received on 72,000 shares @ € 5) (i) | Equity Share Application Alc Dr. 3,60,000 To Equity Share Capital A/c 1,20,000 To Securities Premium A/c 80,000 To Share Allotment Ave 1,00,000 To Bank Alc 60,000 (Being application money transferred to share capital, securities premium, allotment and refunded) (ii) | Equity Share Allotment A/e Dr. 2,40,000 ‘To Equity Share Capital Afe 1,560,000 ‘To Securities Premium AJc 80,000 (Being share allotment money due) () | Bank Ave Dr. 41,36,500 Calls-in-arrear Ale Dr, 3,500 ‘To Equity Share Allotment A/c 41,40,000 (Being allotment money of € 6 received except ‘on 1,000 shares) ‘AD Accountaney—12 °r Equity Share Capital Ale 7.000 Securities Premium Ale 2,000 To Callsin-arrears Ale 3,500 To Shares Forfeited Ave 5,500 (Being 1,000 shares were forfeited) (i) | Equity Share First and Final Call Ale Dr. 1,17,000 ‘To Equity Share Capital A/e 1,17,000 (Being frst call @ € 3 due on 39,000 shares) Gi) [Bank Ave Dr. 1,17,000 ‘To Equity Share First and Final Call Ale 1,17,000 (Being first and final eall money received on 39,000 shares ) (vit) [Bank Ave Dr. 3,150 Shares Forfeited Ae br. 1350 ‘To Equity Share Capital Ale 4,500 (Being 450 shares reissued @ © 7 per share as fully paid up) (@) | shares Forfeited ale Dr. 1,125 ‘To Capital Reserve Ale Lis (Being gain on reissue of forfeited shares transferred to capital reserve) Working Notes: i) = 22 00 = 1000 shares : Money paid by him on application (1,500 x % 5) 7,500 Money adjusted on aplication (1,000 x € 5) S000 Excess money 00. Amount due by him on allotment (1,000 x % 6) 6,000. Less: Excess money adjusted 2,500 Money not paid by him on allotment 3,500 (i) Amount transferred to Capital Reserve = ([S:500 = € 2,475 ~% 1,350 = T1125 EAD Accountaney—12 oor Journal of Adani Ltd. EAD Accountancy—12 ” Date Particulars LE Dr. @ ce @) (| Bank Ave Dr. 195,000 1,95,000 To Share Application Ale (Being application money received on 6,500 shares, @ F 30 each) (i) | Shares Application A/c Dr. 1,95,000 ‘To Share Capital Ale 1,20,000 To Share Allotment A/c (45,000 + 15,000) 60,000 To Bank Afe 15,000 (Being the application money on 4,000 shares transferred to share capital and excess money was adjusted to share allotment and balance refunded) (i) | Share Allotment Ale Dr. 2,00,000 To Share Capital Ale 1,20,000 ‘To Securities Premium A/c 80,000 (Being the allotment money due on 4,000 shares @ 50 cach including premium of & 20 each) (@) [Bank ave Dr, 137,600 Calls in Arrears Ae Dr. 2400 To Share Allotment Alc 1,40,000 (Being allotment money received) () | Share First and Final Call Ale Dr. 1,560,000, ‘To Share Capital Ale 1,560,000 (Being first and final call money due on 4,000 Shares @ & 40 each) (i) | Bank Ave Dr. 1,51,000 Calls in Arrears Ale Dr, 9,000 ‘To Share First and Final Call A’e 1,560,000 (Being first and final call money received) (it) | Share Capital Ale Dr. 2,500 Securities Premium A/e Dr 1,500 To Calls in Arrears Ale 11,400 ‘To Share Forfeiture A/c (3,600 + 9,000) 12,600 (Being 225 shares forfeited due to non-payment of allotment and first and first call)(witty) Bank Ale 9,000 Share Forfeiture Ale 1,000 ‘To Share Capital A/c 10,000 (Being 100 shares reissued @ & 90 each as fully paid up) (@) [Share Forfeiture Ale Dr 3,725 To Capital Reserve Ale ams (Being the balance of share forfeiture Ale transferred to capital reserve) Working Notes: 6 Number of shares applied by Paral = $202 3 95 = € 120 z Money paid on application (120 x ¥ 30) Application money adjusted (75 x @ 30) Excess money Money due on allotment (75 x ® 50) Less: Adjusted from excess money Money not paid by Parul on allotment (i Total Allotment money due 2,00,000 Less: Application money adjusted 60,000 Amount unpaid by Parul 2,400 Total amount received on Allotment 1,37,600 Gi) Amount wansteted to Capat Reser = (T0075) (£2.00 35) — & 1,000 = € 3,600 + € 1,125 ~ & 1,000 = € 4,125 -€ 1,000 = 3,75 24, Dr. Revaluation Ale cr Particulars; ‘Amount (®) Particulars Amount @® To Workmen Compensation Claim 10,000 By Provision for Doubtful Debts, 500 To Gain transferred to: By Freehold Premises 12,800 Sudhir 1,980 Kabir 1,320 3,300 13300 13,300 EAD Accountaney—12 °Dr Partners’ Capital Ales cr Sudhir | Kabir | Adheor Sudhir | Kabir [Adheer Particulars Particulars ® | @ |e o | | @ ‘To Advertisement By Balance bid 1,00,000 80,000] — Suspense Ale 8.220] sso] —|ByGenerat Reserve Arc] 5,760] 3840] — To Bank Ae 4500] 500] —|By Revaluation Ale | L980) 1320) — ‘To Balance cd (Bal. Fig, | 1.04020] 84,180) 47,050 | By Premium for Goodwill Ale 9,000 | 9,000 | 47,080 Terao] 94.100] 27050 1.36,740 | 94,160 47,050 Balance Sheet Liabilities ‘Amount @ ‘Assets ‘Amount @ Sudhir's Capital Alc 1,04,020 | Freehold Premises 1.72800 Kabit’s Capital Ale 84,180 Stock 43,000 Adheer's Capital Ale 50 | Debtors 28,000 Workmen Compensation Claim 23,000| Less: Provision for Employees Provident Fund 16,700] Doubsful Debs, 1,500 26,500 Creditors 16,400 Bills Receivable 13,500 Bank Loan 40,000 Cash at Bank 331,350, 331,350 Working Notes: (i Combined Capital of Sudhir and Kabir = 1,04,020 + & 84,180 = & 1,88,200 , 5 L_4 Combined Share of Sudhir and Kabir = 1-4 = 4 Capital ofthe firm = © 188200 x Adheer’s Capital = € 1,88,200 x 3x $ = © 47,050 (ii) Cash at Bank = & 19,500 + % 18,000 ~& 9,000 + & 47,050 = & 75,550 or Dr Revaluation Ae cr. ‘Amount Amount Particulars @ Particulars ve To Provision for Doubtful Debts 2,050 By Premises 27,500 (28000 -2,500x 1-000 To Outstanding Claim for Damages 2300 To Creditors 2,000 TT Stock 3,800 To Gain transferred to Rita 6,940 Gita 6.940 Tabasum samo | 17.350 27,500 27500 ‘AD Accountaney—12 @Dr. Partners’ Capital A/es cr = ee ee ee By Cush Ae =| sais Balance Sheet Liabilities ‘Amount (®) Assets ‘Amount Creditors 56,000 | Cash in Hand 35,000 Bills Payable 20,600 | Debtors 28,000 Employees Provident Fund 5,200 | Less: Bad Debts 2,500 Outstanding Claim for Damages 2,300 | Less: Provision for Doubtful Capital Ales: Debts 2,550 22,950 Gita 138,175 Stock 175,000 Tabasum 1,38,175 | 2,76,350]] Premises 1,37,500 Investments 90,000 360,450) 360,450 Working Not (@ Calculation of Gaining Ratio: Gita’s Gain = 4-2= 4, Tabsum’s G. 11.3 Tabsum’s Gain = 5-2= (ii) Total Capital of New Firm Adjusted Capital of All Partners + Working Capital - Available Cash = 2,50,000 + & 17,350 - & 12,000 + & 35,000 + & 14,000 = 2,76,350 Capital Contribution in new firm: Gita = €2,76,350 x 4 = € 138,175 Tabsum = & 2,76350 x 4 = € 1,38,175 28. (i) Goodwill = % 1,20,000 Alew’s share of goodwill = € 120000 x fy = € 84,000 Juely’s Capital Ale Dr. 56,000 ‘Tom’s Capital Af Dr. 28,000 To Alex’s Capital A/c 84,000 (Being adjustment of goodwill through capital accounts) EAD Accountaney—12 (19)67 (ii) Profit and Loss Suspense Ae = € 80,000 x xT = ¥ 28,000 Profit and Loss Suspense A/c Dr. 28,000 To Alex’s Capital Ale 28,000 (Being share of profit till death transferred to Alex’s capital account) (iii) Amount to be transferred to Alex’s executors’ Ale ® 2,22,600 Working Note: Dr. Alex’s Capital Ale cr Particulars Amount (@) Particulars Amount ‘To Goodwill Ale 54,600 | By Balance bid 1,40,000 To B’s Bxecutors’ Ale (Bal. Fig.) 2,22,600 | By General Reserve Afe 25,200 By Juely’s Capital Ale (Goodwill) 56,000 By Tom's Capital A/c (Goodwill) 28,000 By Profit and Loss Suspense A/c 28,000 2,77,200 2,77,200 26. Journal Date Particulars Dr. Cr) Bank Alc Dr. 26,00,000 ‘To Debenture Application Aje 26,00,000 (Being application amount received on 40,000 debentures) Debenture Application Alc Dr, 26,00,000, ‘To 9% Debentures Ale 26,00,000 (Being application money transferred to debentures, account) Debentures Allotment Ale Dr. 11,20,000, Loss on Issue of Debentures A/c Dr. 6,80,000 ‘To 1% Debentures Ale Premium on Redemption of Debentures Afe (Being allotment of 40,000 debentures issued at discount and redeemable at premium) Bank Ale Dr. 11,20,000, To Debenture Allotment Afe (Being allotment money received on 40,000 debentures) 14,00,000 400,000 11,20,000 ‘AD Accountaney—12 nyDr. Loss on Issue of Debentures A/e cr Amount Amount Particulars Particulars ®. ® To 7% Debenture Alc 2,80,000 | By Statement of Profit and Loss 680,000 To Premium on Redemption of Debentures Ale 400,000 6,80,000 6,80,000 27. (c) Interest paid on loan. or (@) (); 5 @s (i) 28, (a) & 6,000 29. (c) Statement I is correct and Statement II is incorrect. or (6) ‘Conversion of & 2,00,000 debentures into shares. 30. (c) Cash flow from investing activities & 46,000, 31. Items Major Heads Sub-heads. ( Bills Payable Current Liabilities Trade Payables (i) Unpaid Dividends Current Liabilities Other Current Liabilities (iii) Provision for Taxation Current Liabilities Short-term Provisions () Investment in Mutual Funds Non-current Assets Non-current Investments-Other Investments, (0) Stores and Spares Current Assets Inventories (vi) Debentures maturing in current year | Current Liabilities ‘Other Current Liabilities 32. (@) (#) Decrease: Current Assets and Current Liabilities both increase with same amount. (i) Decrease: Current Assets decrease with the amount of loss. (ii) Decrease: Current Assets decrease with the amount of redemption, 2 00 Cost of Revenue from Operations = Revenue from Operations ~ Gross Profit, () Gross Profit = % 3,00,000 x % 60,000 % 3,00,000 - & 60,000 = & 2,40,000 Cost of Revenue from Oper: “Average inventory Inventory Turnover Ratio EAD Accountancy 12, (2)Average Inventory = Average Inventory = % 48,000 % 48,000 % 48,000 x Closing Inventory Quick Ratio = 08 _ Quick Assets Current Assets Current Ratio 33. %2,40,000 “Average Inventory 2,40,000 > % 48,000 Opening Inventory + Closing Inventory x + © 27,000 % 48,000 - & 27,000 % 21,000 % 21,000 + & 54,000 % 75,000 Quick Current Liabilities Quick Assets © 40,000 % 40,000 x 0.8 = € 32,000 % 32,000 + 75,000 % 1,07,000 107,000 ate = 2.67821 Common-size Statement of Profit and Loss for the years ended 31st March 2022 and 2023 Absolute Amount ae era Particulars from Operations ‘31.03.2022 | 31032023 | sios.2022 | 31.03.2023 © © (Ge) (%) 1. Revenue from Operations 1,00,000 | _1,00,000 100 100 II. Employee Benefit Expenses 70,000 | 74,800 0 74.80 Other Expenses 8,000 9,800 8 98 II, Total Expenses (I + 11) 78,000 | _84,500 n 845 IV. Profit before Tax (I 111) 22,000 | 15,400 2 154 V. Tax 11,000 7,700 ul 1 VI. Profit after Tax (IV-V) 11,000 7,700 2. ‘AD Accountaney—12 3)Or ‘Comparatives Statement of Profit and Loss for the years ended 31st March 2022 and 2023 Te | cael anaes Portals Stason | S1an2e78 | gree | aacece esas ossae ®@ (%e) T Resene om Operations re90m | 2000] —sino0] ear 1. Other Income ano | izao00 | sone | 38 Ii Total Revenue + 1 2:00 | 200000 | —Tin.0o | 238 IV. Expenses zoom | i000 | "Stc000 | _sn00 Profit befor Tox 11) T0060 [1.90000 [sono | 7273 3M, Note: Short term provisions are assumed to be provision for tax. Cash Flow Statement of Vednta Lt for the year ended 31st, March, 2023 Particulars Amount (%) | Amount (%) TA. ash Fow rom Operating Active Net Prof before Tx 75.000 ‘Aaa: Noncash an Now operating expenses Loss on eof Machinery 100 Imerest on bank lean sco Adjsiment for Curent Ass and Corset Liskites Increase in Trade Receivables (13,500) Net Cash inflow fom Operating Actes bfoe ax 120.00 dessa paid 63500) sao Sale of Machinery 3000 Purchase of Machinery (1700 (1,44,000) EAD Aceountaney—12, a)© Cash low from Financing Activities Cash proceeds from issue of Equity Shares 000 Raising of Bank Loan 35,000 Interest on Bank Loan (5,100) Net Cash Inflow from Financing Activities 79,900 D. Net Increase in Cash and Cash Equivalents (A + B + ©) 17.500 Add: Opening Balance of Cash and Cash Equivalents (1,87,500 + 75,000) 2,62,500 E,_Closing balance of Cash and Cash Equivalents (1,60,000 + 1,20,000) 2,80,000 Working Not (i) Calculation of Profit before Tax: ® Balance as per Statement of Profit and Loss 50,000 Add: Provision for Tax (Current year) 25,000 Net Profit before Tax 75,000 (i) Calculation of Sale of Furniture: Dr. Machinery Account Cr ‘Amount ‘Amount Particulars Particulars @ ® To Balance bid 5,00,000 | By Bank Ave (Sale) 3,000 To Bank A/c (Purchase) (Bal. Fig.) | 1,47,000| By Accumulated Depreciation Ac 8,000 By Statement of Profit and Loss (Loss) 1,000 Balance cfd 6,47,000 647,000 Dr. Accumulated Depreciation A/e cr, ‘Amount ; ‘Amount Particulars a Particulars a To Machinery Ale (Sold part depreciation) 8,000 | By Balance bid 75,000 ‘To Balance cfd 1,00,000 | By Statement of Profit and Loss 33,000 (Depreciation) (Bal. Fig.) 108,000 108,000 ‘AD Accountaney—12 5)