Solution

SAMPLE PAPER 23-24 (2)

Class 12 - Accountancy
Part A:- Accounting for Partnership Firms and Companies
1.
(c) 5 : 3 : 2
Explanation: total share = 1
Q's share = 20/100 = 1/5
remaining share for M and N = 1-1/5 = 4/5
M' new share = 4/5 x 5/8 = 20/40
N' s new share = 4/5 x 3/8 = 12/40
Q share = 1/5 x 8/8 = 8/40
ratio 20:12:8
5:3:2

2. (a) Both A and R are true and R is the correct explanation of A.

Explanation: Both A and R are true and R is the correct explanation of A.

59
3.
(c) 60,000
Explanation: amount refund
5,000 shares @ 12 per share
53
= 60,000
3.5
OR
(a) Capital Reserve Account
Explanation: Capital Reserve Account
10

4.
(d) Credited with ₹ 18,000
Explanation: pinki's sacrifice = 2/5 -1/4 = 3/20 sacrifice
so her account will be credited by 1,20,000 x 3/20 = 18,000
99

OR
(a) ₹ 26,267 for Partner B and C and ₹ 27,466 for Partner A.
Explanation: 80000+1200 =81200 IN EQUAL RATIO
₹ 26,267 for Partner B and C and ₹ 27,466(26267+1200) for Partner A.
5.
(b) Debit side
Explanation: Debit side
6.
(d) 6000
Explanation: 540000/90=6000
OR
(a) 10,000 debentures
9,00,000
Explanation: No for Debentures to be issued = Purchase Price

Issued Price
=
90
= 10,000 shares
7. (a) Both A and R are true and R is the correct explanation of A.
Explanation: Both A and R are true and R is the correct explanation of A.
8.
(b) ₹ 70,820

1 / 16
Aarth's Academy of Commerce, 9910355359
 Explanation: Amount transfer to B loan account
= 50000 (capital) + 6000 (reserve ) + 12000 (Goodwill) + 2820 (profit on revaluation)
= 70820

OR

(d) ₹ 5,000
Explanation: Total profit = 2,00,000
Siya's share in profit = 2, 00, 000 × 1

5
= 40, 000

Siya's deficiency = 50,000 - 40,000 = 10,000

Anu share in deficiency = 10, 000 × = 5, 0001

9. (a) ₹ 2,400
Explanation: ₹ 2,400
10. (a) ₹ 2,100
Explanation: ₹ 2,100
11. (a) profit and loss appropriation account
Explanation: profit and loss appropriation account
12.

59
(d) (a) - (iv), (b) - (i), (c) - (ii), (d) - (iii)
Explanation: (a) - (iv), (b) - (i), (c) - (ii), (d) - (iii)
13.
(d) ₹ 35,000
53
Explanation: Share Forfeiture Account will be Credited from Capital portion received:
On application ₹ 15 per share
3.5

On allotment ₹ 22 per share

On first Call ₹ 33 per share

₹ 70
10

500 Shares × ₹ 70 = ₹ 35,000

99

14.
(c) ₹ 16,000
Explanation: (42000-42000x5/105)x2/5=₹ 16,000
15. (a) the old profit-sharing ratio
Explanation: C is to bring his share of the premium for goodwill in cash. If the incoming partner brings the amount of
goodwill in Cash and also a balance exists in goodwill account, then this goodwill account is written off among the old
partners in the old profit-sharing ratio.
OR

(c) 13

54

Explanation: sacrifice of A for D = 3/6 x 1/3 = 3/18

sacrifice of B for D = 2/6 x 1/6 = 2/36
sacrifice of C for D = 1/6 x 1/9 = 1/54
d' share = 3/18 + 2/36 + 1/54 = 13/54

16.
(c) ₹ 19,000
Explanation: Realisation will be credited with the amount of ₹ 19,000 as taken over investment.

2 / 16
Aarth's Academy of Commerce, 9910355359
17. Whenever there is a change in profit sharing ratio of one or more of existing partners have to surrender some of their old share in
favour of one or more of other partners. The ratio of the surrender of the profit sharing ratio is called the sacrificing ratio.
Sacrificing ratio = Old profit sharing ratio - New profit sharing ratio.
It is compulsory to determine this ratio as the new partner has to reimburse the existing partner for making the sacrifice of profit.
It is paid usually on the basis of the proportionate amount of goodwill.
18. PROFIT & LOSS APPROPRIATION ACCOUNT
for the year ended
Dr. Cr.

Particulars ₹ Particulars ₹

To Profit transferred to: By Profit & Loss A/c ( net profit ) 92,200

X's Capital A/c 45,800 Less: Interest on X's Loan @6% p.a. (1200 × 6/12 ) 600 91,600

Y's Capital A/c 45,800 91,600

91,600 91,600
OR
PROFIT AND LOSS APPROPRIATION ACCOUNT
for the year ended 31st March, 2023
Particulars ₹ Particulars ₹

59
To Interest on Capital A/cs: By Profit and Loss A/c 8,00,000

X's Current A/c 25,000 (Net Profit)

53
Y's Current A/c 20,000 45,000

To Y's Salary A/c (Y's Current A/c) 60,000

3.5
To General Reserve A/c 69,500

To Profit transferred to:

X's Current A/c 4,37,850

10

Y's Current A/c 1,87,650 6,25,500

8,00,000 8,00,000
99

Amount transferred to General Reserve = 10% of Divisible Profit

= 10% of ₹ 6,95,000 (i.e., ₹ 8,00,000 - ₹ 25,000 - ₹ 20,000 - ₹ 60,000)
= ₹ 69,500
19. Journal of Himani Ltd.
Date Particulars L.F. Dr. (₹) Cr. (₹)

Sundry Assets A/c Dr. 8,40,000

Goodwill A/c (Balancing Figure) Dr. 40,000

To Creditors A/c 80,000

To Himanshu Ltd. 8,00,000

(Purchase of business of Himanshu Ltd.)

Himanshu Ltd. Dr. 8,00,000

To 12% Debentures A/c (6,400 × 100) 6,40,000

To Securities Premium A/c (6,400 × 25) 1,60,000

(Issue of 6,400; 12% Debentures of ₹ 100 each at 25% premium)

P urchase Consideration ₹ 8,00,000
Note: No. of Debentures to be issued = = = 6,400 Debentures.
issue P rice of Debenture ₹ 125

3 / 16
Aarth's Academy of Commerce, 9910355359
 OR
JOURNAL
Date Particulars L.F. Dr. (₹) Cr. (₹)

Share Capital A/c (100 × ₹ 8) Dr. 800

To Share First Call A/c (100 × ₹ 3) 300

To Share Forfeiture A/c (100 × ₹ 5)

500
(100 shares of ₹ 10 each forfeited for non-payment of first call money of ₹ 3)

Bank A/c Dr. 700

Share Forfeiture A/c Dr. 100

To Share Capital A/c

800
(100 forfeited shares re-issued at ₹ 7 per share as ₹ 8 paid-up)

Share Forfeiture A/c Dr. 400

To Capital Reserve A/c

400
(Profit on reissue of 100 shares transferred to Capital Reserve)

20. Particulars Amount (₹)

9
Average Profit 3,00,000

Less: Normal Profit: 12% of ₹ 20,00,000

Super Profit
35 2,40,000

60,000
.55
Value of Goodwill = Super Profit × 100

Normal Rate of Return

100
= ₹ 60,000 × 12
= ₹ 5,00,000

21. Basis Preference Shares Equity shares

3

The rate of dividend on equity shares vary from

Dividend rate Preference share holders are paid dividend at a fixed rate.
year to year depending upon profits
10

Redemption
They can be redeemed They can’t be redeemed.
dividend
99

Payment of These shares have a Preferential right to receive dividend Payment of dividend is made after paying to
dividend before any dividend is paid on equity shares. Preference share holders.
Arrears of
Get accumulated for cumulative preference shares No accumulation
Dividend
Have a right to return of capital before equity shares . Only paid when preference share capital is paid
Winding up
This means they are safer. fully
Voting Rights No voting rights Voting rights

Right to participate
Have no right Have right
in Management
22. JOURNAL
Date Particulars L.F. Dr. (₹) Cr. (₹)

2023

Mar. 31 Realisation A/c Dr. 45,000

To Nisha’s Capital A/c 45,000

(unrecorded liability paid by the partner)

Mar. 31 Realisation A/c Dr. 32,000

4 / 16
Aarth's Academy of Commerce, 9910355359
 To Cash A/c 32,000

(creditors accepted the furniture and balance amount paid in cash)

Mar. 31 Kishor’s Loan A/c Dr. 18,000

To Cash A/c 18,000

(Kishor’s loan paid by firm)

Mar. 31 Rohan’s Capital A/c Dr. 72,000

To Realisation A/c 72,000

(stock taken by Rohan)

Mar. 31 Realisation A/c Dr. 6,000

To Kishor’s Capital A/c 6,000

(dissolution expenses paid by Kishor on firm’s behalf)

Mar. 31 Nisha’s Capital A/c Dr. 20,000

Kishor’s Capital A/c Dr. 12,000

59
Rohan’s Capital A/c Dr. 8,000

To Realisation A/c 53 40,000

(loss on dissolution charged from partners in the old ratio)

23. JOURNAL
Amt Amt
3.5
Date Particulars L.F
(Dr.) (Cr.)

1. Bank A/c (1,00,000 × 10) Dr. 10,00,000 ....

To Equity Share Application and Allotment A/c .... 10,00,000

10

(Being application money received on 1,00,000 snares) .... ....

2. Equity Share Application and Allotment A/c Dr. 10,00,000 ....

99

To Equity Share Capital A/c (80,000 × 5) .... 4,00,000

To Securities Premium Reserve A/c (80,000 × 5) .... 4,00,000

To Equity Share First and Final Call A/c .... 1,00,000

To Bank A/c (10,000 × 10) .... 1,00,000

(Being application money transferred to share capital account and excess money is adjusted
.... ....
in final call account)

3. Equity Share First and Final Call A/c Dr. 8,00,000 ....

To Equity Share Capital A/c (80,000 × 5) .... 4,00,000

To Securities Premium Reserve A/c (80,000 × 5) .... 4,00,000

(Being amount due on first and final call) .... ....

4. Bank A/c Dr. 6,86,000 ....

To Equity Share First and Final Call A/c .... 6,86,000

(Being amount received on first and final call) .... ....

5. Equity Share Capital A/c (1,600 × 10) Dr. 16,000 ....

Securities Premium Reserve A/c (1,600 × 5) Dr. 8,000 ....

5 / 16
Aarth's Academy of Commerce, 9910355359
 To Equity Share Forfeiture A/c .... 10,000

To Equity Share First and Final Call A/c (Being Kumar's share forfeited) .... 14,000

6. Bank A/c (1,600 × 9) Dr. 14,400 ....

Equity Share Forfeiture A/c Dr. 1,600 ....

To Equity Share Capital A/c (1,600 × 10) .... 16,000

(Being forfeited shares reissued for Rs. 9 as fully paid up) .... ....

7. Equity Share Forfeiture A/c Dr. 8,400 ....

To Capital Reserve A/c .... 8,400

(Being excess amount on forfeiture transferred to capital reserve) .... ....

Working Notes:-
1. Computation Table
Money Received on Money Transferred to Money Transferred to Excess
Shares Shares
Categories Application @ Rs. 10 Share Capital @ Rs. 5 Securities / Premium Application
Applied Allotted
each each Reserve Money

I 10,000 - 1,00,000 1,00 - -

9
II 90,000 80,000 9,00,000 4,00,000 1,00,000

1,00,000 80,000 10,00,000

2. Calculation of Amount not Received on First and Final Call:-
Shares allotted to Kumar =
80,000
× 1, 800 = 1, 600 Shares
35 10,00,000 4,00,000 1,00,000
.55
90,000

Amount received on 1,800 shares @ Rs. 10 each 18,000

Amount transferred to share capital account (1,600× 5) 8,000

Amount transferred to securities premium account (1,600 × 5) 8,000

3

Excess money received on application 2,000

10

Amount due on first and final call for 1,600 shares of Kumar @ Rs. 10 each 16,000

Amount not received on securities premium 8,000

99

Amount not received on first and final call 6,000

3. Calculation of Amount Credited in Share Forfeiture Account:-
Amount received on application and allotment 18,000

(-) Amount received for securities premium 8,000

Amount to be credited in share forfeiture account 10,000

OR
BOOKS OF MEHTA LTD.
Date Particulars L.F. Dr. (₹) Cr. (₹)

Bank A/c Dr. 18,00,000

To Equity Share Application A/c

18,00,000
(Application money received for 3,00,000 shares)

Equity Share Application A/c Dr. 18,00,000

To Equity Share Capital A/c 8,00,000

To Securities Premium A/c 4,00,000

To Equity Share Allotment A/c 6,00,000

6 / 16
Aarth's Academy of Commerce, 9910355359
 (2,00,000 shares allotted and excess amount credited to Share Allotment A/c)

Equity Share Allotment A/c Dr. 14,00,000

To Equity Share Capital A/c 10,00,000

To Securities Premium A/c

4,00,000
(Allotment money due on 2,00,000 shares)

Bank A/c(1) Dr. 7,98,400

Calls in Arrears A/c Dr. 1,600

To Equity Share Allotment A/c

8,00,000
(Allotment money received on 1,99,600 Shares)

Equity Share First & Final Call A/c Dr. 2,00,000

To Equity Share Capital A/c

2,00,000
(Call money due on 2,00,000 shares @ ₹ 1 per share)

Bank A/c Dr. 1,99,400

Calls in Arrears A/c (600 × ₹ 1)(2) Dr. 600

9
To Equity Share First & Final Call A/c
(Call money received on 1,99,400 shares)

Equity Share Capital A/c

35 Dr. 6,000
2,00,000
.55
Securities Premium A/c(3) Dr. 800

To Calls in Arrears A/c 2,200

To Share Forfeiture A/c

3

4,600
(Forfeiture of 600 shares)
10

Bank A/c Dr. 3,200

Share Forfeiture A/c Dr. 800

99

To Equity Share Capital A/c

4,000
(Re-issue of 400 shares @ ₹ 8 per share)

Share Forfeiture A/c Dr. 2,400

To Capital Reserve A/c(4)

2,400
(Gain on reissue of forfeited shares transferred to Capital Reserve Account)
Working Notes:
1. A. Excess amount received from Mamta on application:
Mamta has been allotted 400 shares.
3,00,000
She must have applied for 2,00,000
× 400 = 600 Shares.
Excess application money received from Mamta = 600 Shares - 400 Shares
= 200 Shares × ₹ 6 = ₹ 1,200

B. Amount due from Mamta on Allotment: ₹

400 Shares × ₹ 7 2,800

Less: excess received from Mamta on application 1,200

Allotment money not received from Mamta 1,600

C. Total amount due on allotment: 2,00,000 shares × ₹ 7 14,00,000

7 / 16
Aarth's Academy of Commerce, 9910355359
 Less: Excess amount received on application 6,00,000

Balance Due 8,00,000

Less: Amount not received from Mamta on Allotment 1,600

Net amount received on allotment in Cash 7,98,400

2,00,000
2. Kiran, who had applied for 300 shares must have been allotted 300 × 3,00,000
= 200 Shares. Hence, First and Final Call is not
received on 400 shares of Mamta + 200 shares of Kiran.
3. Mamta has not paid allotment money on her 400 shares. Hence, Securities Premium has been debited on the amount of
premium not received on her 400 shares @ ₹ 2 each.
4. Amount transferred to Capital Reserve:
400 shares have been reissued which include 200 shares of Mamta and 200 shares of Kiran.

i. ₹

Mamta has paid application money on 600 shares @ ₹ 6 each 3,600

Less: Amount of premium adjusted on application:

400 shares @ ₹ 2 each 800

2,800
This excess amount of ₹ 2,800 is the amount forfeited on her 400 shares.

9
Forfeited amount on her 200 shares = 2,800 × 200

400
= 1,400
ii. Forfeited amount on Kiran’s 200 shares:

35
Amount paid on Application: 200 × ₹ 4 (excluding premium) 800
Amount paid on Allotment: 200 × ₹ 5 (excluding premium) 1,000 = 1,800
= 3,200
.55
Less: Loss on Reissue: 400 shares × ₹ 2 = 800
Amount transferred to Capital Reserve = ₹ 2,400

24. Dr Revaluation Account Cr

3

Particulars Amt(Rs) Particulars Amt(Rs)

10

To Provision for Outstanding Electricity Bill A/c 3,000 By Creditors A/c 2,500

To Provision for Claim for Damages A/c 325 By Provision for Bad and Doubtful Debts A/c 25
99

By Loss Transferred to

Atal's Capital A/c(800×5/8) 500

Madan's Capital A/c(800×3/8) 300 800

3,325 3,325

Dr Partners’ Capital Account Cr

Atal Madan Mehra Atal Madan Mehra

Particulars Particulars
(Rs) (Rs) (Rs) (Rs) (Rs) (Rs)

To Cash A/c 5,000 3,000 __ By Balance b/d 1,50,000 90,000 __

(Goodwill is withdrawn) By Cash A/c __ __ 40,000

To Profit and Loss A/c 12,500 7,500 __ By Premium for Goodwill A/c 10,000 6,000

To Revaluation A/c (Loss) 500 300 __ __

By Workmen Compensation Fund

20,000 12,000
A/c

To Cash A/c (Balancing

62,000 37,200 __ __
figure)

8 / 16
Aarth's Academy of Commerce, 9910355359
To Balance c/d 1,00,000 60,000 40,000

1,80,000 1,80,000 40,000 1,80,000 1,80,000 40,000

Balance Sheet
as at 31st March, 2011
Liabilities Amt (Rs) Asset Amt (Rs)

Outstanding Electricity Bill 3,000 Debtors 47,000

Creditors (20,000-2,500) 17,500 (-) Provision for Doubtful Debts (1,175) 45,825

Bank Overdraft 47,000 Land and Building 1,50,000

Provision for Claim for Damages 325 Machinery 40,000

Capital A/cs Patents 5,000

Atal 1,00,000 Stock 27,000

Madan 60,000

Mehra 40,000 2,00,000

2,67,825 2,67,825
Working Note

9
Calculation of Sacrificing Ratio
Sacrificing Ratio = Old Share - New Share
Atal's sacrifice = −
5

Madan s sacrifice = 3

8
=
5

10

−
3

10
=
25−20

=
40
15−12

40
=
5

40

40
35
.55
Sacrificing ratio =5:3
Dr Cash Account Cr

Particulars Amt(Rs) Particulars Amt(Rs)

3

To Balance b/d 4,200 By Atal's Capital A/c 5,000

10

To Mehra's Capital A/c 40,000 By Madan's Capital A/c 3,000

To Premium for Goodwill A/c 16,000 By Atal's Capital A/c 62,000

To Bank Overdraft A/c 47/000 By Madan's Capital A/c 37,200

99

(Balancing figure)

1,07,200 1,07,200
Calculation of Adjustment of Capital
Mehra’s share = 2 /1 0 ; Mehra’s capital = Rs 40,000
For 2 / 10th share, capital = 40,000
10
Total capital = 40, 000 × = Rs2, 00, 000
2

Atal's new capital = 200, 000 × 5

10
= 1, 00, 000

Madan’s new capital = 2, 00, 000 × 3

10
= Rs60, 000

Mehra’s new capital = 2, 00, 000 × 2

10
= Rs40, 000

OR
a. JOURNAL ENTRIES
Date Particulars L.F. Dr. (₹) Cr. (₹)

2020 Prepaid Insurance A/c Dr. 5,000

April 1 Provision for Doubtful debts A/c Dr. 1,300

To Revaluation A/c
6,300
(Increase in the value of assets)

9 / 16
Aarth's Academy of Commerce, 9910355359
 Revaluation A/c Dr. 12,000

To Land and Buildings A/c

12,000
(Decrease in the value of assets)

X's Capital A/c Dr. 2,850

Y's Capital A/c Dr. 1,900

Z's Capital A/c Dr. 950

To Revaluation A/c
5,700
(Loss on revaluation transferred)

X's Capital A/c Dr. 3,000

Y's Capital A/c Dr. 6,000

To Z's Capital A/c

9,000
(Goodwill adjusted in the gaining ratio 1 : 2)

Z's Capital A/c Dr. 69,300

To Bank A/c 9,300

9
To Z's Loan A/c 60,000

Bank A/c(2)
35
(The balance of Z's Capital A/c transferred to his loan A/c)

Dr. 2,100
.55
To X's Capital A/c
2,100
(The amount brought in by X to raise his capital to profit sharing ratio)

Y's Capital A/c(2) Dr. 2,100

3

To Bank A/c
10

2,100
(The amount withdrawn by Y to bring his capital to profit sharing ratio)

Dr. CAPITAL ACCOUNTS Cr.

99

Particulars X Y Z Particulars X Y Z

₹ ₹ ₹ ₹ ₹ ₹

To Z's Capital A/c (Goodwill) 3,000 6,000 ____ By Balance b/d 78,750 70,000 61,250

To Revaluation A/c 2,850 1,900 950 By X's Capital A/c (Goodwill) ____ ____ 3,000

To Bank A/c 9,300 By Y's Capital A/c (Goodwill) ____ ____ 6,000

To Z's Loan A/c 60,000

To Balance c/d 72,900 62,100 ____

78,750 70,000 70,250 78,750 70,000 70,250

To Bank A/c ____ 2,100 ____ By Balance b/d 72,900 62,100 ____

To Balance c/d 75,000 60,000 ____ By Bank A/c 2,100 ____ ____

75,000 62,100 ____ 75,000 62,100 ____

NEW BALANCE SHEET
as at 1st April 2020
Liabilities ₹ Assets ₹

Sundry Creditors 15,000 Cash at Bank (₹ 10,000 + ₹ 2,100 - ₹ 2,100 - ₹ 9,300) 700

10 / 16
Aarth's Academy of Commerce, 9910355359
 Z's Loan 60,000 Debtors 16,000

Capital: Stock 20,300

X 75,000 Prepaid Insurance 5,000

Y 60,000 1,35,000 Machinery 60,000

Land and Buildings 1,08,000

2,10,000 2,10,000
Working Notes:
1. Calculation of Gaining Ratio = New Ratio - Old Ratio
5 3 1
Gain to X = 9
−
6
= 18
4 2 2
Gain to Y = 9
−
6
= 18
1 2
Hence, Gaining Ratio = 18
: 18
=1:2
2. Adjustment of Capitals of X and Y according to new profit sharing ratio
= Total Capital of X and Y after all the adjustments = ₹ 72,900 + ₹ 62,100 = ₹ 1,35,000
This Capital should be in their profit sharing ratio, i.e., 5 : 4
₹

Therefore, the Capital of X in the new firm should be 5

9
th of ₹ 1,35,000 75,000

9
But the existing Capital of X is 72,900

Hence, X will bring in

The Capital of Y in the new firm should be 4

9
35
th of ₹ 1,35,000
2,100

60,000
.55
But the existing Capital of Y is 62,100

Hence, Y will withdraw 2,100

b. Settlement of Loan Account:

3

Dr. Z's LOAN ACCOUNT Cr.

10

Date Particulars ₹ Date Particulars ₹

2021 March 31 To Bank A/c (₹ 20,000 + ₹ 6,000) 26,000 2020 April 1 By Z's Capital A/c (transfer) 60,000
99

March 31 To Balance c/d 40,000 2021 March 31 By interest A/c (on ₹ 60,000 at 10%) 6,000

66,000 66,000

2022 March 31 To Bank A/c (₹ 20,000 + ₹ 4,000) 24,000 2021 April 1 By Balance b/d 40,000

March 31 To Balance c/d 20,000 2022 March 31 By Interest A/c (on ₹ 40,000 at 10%) 4,000

44,000 44,000

2023 March 31 To Bank A/c (₹ 20,000 + ₹ 2,000) 22,000 2022 April 1 By Balance b/d 20,000

2023 March, 31 By Interest A/c (on ₹ 20,000 at 10%) 2,000

22,000 22,000
25. In the books of Gita and Garv
Dr. Revaluation A/c Cr.

Particulars Amount (₹) Particulars Amount (₹)

By Stock A/c 16,000

By Building A/c 1,00,000

By Investments A/c 4,000

To Profit on revaluation transfer to:

11 / 16
Aarth's Academy of Commerce, 9910355359
Gita’s Capital A/c 36,000

Radha’s Capital A/c 60,000

Garv’s Capital A/c 24,000 1,20,000

1,20,000 1,20,000
Partner’s Capital A/c
Dr. Cr.

Particulars Gita (₹) Radha (₹) Garv (₹) Particulars Gita (₹) Radha (₹) Garv (₹)

To Radha’s Capital A/c 90,000 60,000 By balance b/d 3,00,000 2,00,000 1,00,000

To Radha’s Loan A/c 4,30,000 By Gita’s Capital A/c 90,000

To balance c/d 3,00,000 2,00,000 By Garv’s Capital A/c 60,000

By General Reserve A/c 12,000 20,000 8,000

By Revaluation A/c 36,000 60,000 24,000

By Current A/c 42,000 1,28,000

3,90,000 4,30,000 2,60,000 3,90,000 4,30,000 2,60,000

Working Notes:

9
i. Calculation of Radha’s Share of Goodwill on her retirement
Goodwill of the firm on retirement

Radha’s Share of Goodwill of firm

35 = ₹ 3,00,000

= ₹ (3,00,000×
5

10
) = ₹ 1,50,000
.55
Gaining ratio will be the same as the new profit-sharing ratio i.e. 3: 2
ii. Adjustment of Capital of partners
Total Capital of the new firm after retirement = ₹ 5,00,000
3

Gita’s New Capital = ₹ (5,00,000 × ) = ₹ 3,00,000

3

5
10

Garv’s New Capital = ₹ (5,00,000 × ) = ₹ 2,00,000

2

Existing Capitals of Gita and Garv are ₹ 2,58,000 and ₹ 72,000

Amount to be debited to Gita’s Current A/c = New Capital – Old Capital
99

= ₹ ( 3,00,000 – 2,58,000) = ₹ 42,000

Amount to be debited to Garv’s Current A/c = New Capital – Old Capital

= ₹ ( 2,00,000 – 72,000) = ₹ 1,28,000

Balance Sheet as at 31st March 2019

Liabilities Amount (₹) Assets Amount (₹)

Sundry Creditors 60,000 Stock 96,000

Radha’s Loan A/c 4,30,000 Building 6,00,000

Capital A/c's of partner Debtors 40,000

Gita 3,00,000 Current A/c's of partner

Garv 2,00,000 5,00,000 Gita 42,000

Garv 1,28,000 1,70,000

Cash 84,000

(50,000 + 34,000)

9,90,000 9,90,000

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26. JOURNAL OF Y LTD.
Date Particulars L.F. Dr. (₹) Cr. (₹)

2022
Bank A/c Dr. 6,00,000
June 1

To Debentures Application and Allotment A/c

6,00,000
(Application money received for 6,000; 12% Debentures)

Debentures Application and Allotment A/c Dr. 6,00,000

Loss on Issue of Debentures A/c Dr. 42,000

To 12% Debentures A/c 6,00,000

To Premium on Redemption of Debentures A/c

42,000
(Debentures allotted and premium payable on redemption accounted)

2023
Statement of Profit & Loss (Finance Cost) Dr. 42,000
March 31

To Loss on Issue of Debentures A/c

42,000
(Loss on Issue of Debentures written off)

9
Notes:
1. Loss on Issue of Debentures is written off in the year debentures are allotted.

35
2. Loss on Issue of Debentures is written off from Statement of Profit & Loss because the company does not have balance in
Securities Premium.
.55
Dr. LOSS ON ISSUE OF 12% DEBENTURES ACCOUNT Cr.

Date Particulars ₹ Date Particulars ₹

By Statement of Profit & Loss

2022 June 1 To Premium on Redemption of Debentures A/c 42,000 2023 March 31 42,000
(Finance Cost)
3

42,000 42,000
10

Part B :- Analysis of Financial Statements

27. (a) Management
99

Explanation: Management
OR

(c) Revenue from Operations

Explanation: Revenue from sale of scrap from goods manufactured is shown in the Statement of Profit and Loss as Revenue
from Operations.
28.
(c) All of these
Explanation: Inorder to improve Operating Profit Ratio, either cost needs to be reduced or Selling price needs to be raised or
both need to be done.
29.
(c) Financing Activity
Explanation: Financing Activity
OR

(b) Amortization of a patent

Explanation: Amortization of patent will not create cash flow as there is no cash transaction in Amortization. Amortization is
the process of writing off losses or expenses.

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30. (a) Increase in General Reserves
Explanation: Increase in General Reserves

31. Particulars (i) (ii) (iii) (iv) (v) (vi)

Operating Cycle (Months) 10 10 10 15 15 20

Expected Period when payment is received (Months) 9 12 14 14 18 18

Liabilities are Classified as Current Current Non-Current Current Non-Current Current

32. Current Ratio
= Current Assets

Current Liabilities
50,000
= 20.000

= 2.5 : 1
Working Note;
Current Liabilities = Total Assets - Shareholders’ Funds - Non-current Liabilities
= 1,00,000 - 60,000 - 20,000
= Rs. 20,000
Current Assets = Total Assets - Non-current Assets
= 1,00,000 - 50,000
= Rs. 50,000
33. IN THE BOOKS OF ABC LTD.

9
COMPARATIVE STATEMENT OF PROFIT & LOSS.

Particulars Note No. 2015-16

35
for the years ended 31st March, 2016 and 2017

2016-17
Absolute Change
(Increase or
Percentage Change
(Increase or
.55
Decrease) Decrease)

1 2 3 4 5

A B B-A=C C/A × 100 = D

3

₹ ₹ ₹ %
10

I. Revenue from
50,00,000 75,00,000 25,00,000 50.00
Operations

II. Add: Other

99

2,00,000 1,50,000 (50,000) (25.00)

Income

Total Revenue I + II 52,00,000 76,50,000 24,50,000 47.12

III. Less: Expenses 30,00,000 45,00,000 15,00,000 50.00

Profit before Tax 22,00,000 31,50,000 9,50,000 43.18

Less: Tax 4,00,000 5,00,000 1,00,000 25.00

Profti after Tax 18,00,000 26,50,000 8,50,000 47.22

Net Profit After Tax
Net Profit Ratio = Revenue from Operations
× 100

18,00,000
2015 - 16 = 50,00,000
× 100 = 36%
OR
COMPARATIVE BALANCE SHEET OF SWAN LTD. as at 31st March, 2078 and 2019
31st March, 31st March, Absolute Change Percentage Change
Particulars Note No.
2018 ₹ 2019 ₹ (₹) (%)
c
(A) (B) (C = B - A) (D =
A
× 100)

I. EQUITY AND LIABILITIES

1. Shareholders' Funds

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 (a) Share Capital:

Equity Share Capital 3,00,000 3,60,000 60,000 20

(b) Reserves and Surplus 1,20,000 1,50,000 30,000 25

2. Non-Current Liabilities

Long-term Borrowings 1,70,000 2,55,000 85,000 50

3. Current Liabilities

Trade Payables 1,50,000 1,20,000 30,000 20

Total 7,40,000 8,85,000 1,45,000 19.6

II. ASSETS

1. Non-Current Assets

Fixed Assets:

(i) Tangible Assets 5,00,000 6,50,000 1,50,000 30

(ii) Intangible Assets 1,00,000 1,00,000 __ __

2. Current Assets

9
(a) Trade Receivables 1,20,000 1,25,000 5,000 4.17

34.
(b) Cash and Cash Equivalents

Total
20,000

7,40,000 35
10,000

8,85,000
Hindustan Ltd.
10,000

1,45,000
50

19.6
.55
CASH FLOW STATEMENT
for the year ended 31.3.2023
Particulars ₹ ₹
3

A. Cash Flow from Operating Activities

10

Net Profit Before Tax (Working Note 1) 1,19,000

Adjustments for:
99

Depreciation on Plant & Machinery 1,75,000

Interest on Mortgage Loan 35,000 2,10,000

Operating Profit before Working Capital Changes 3,29,000

Add: Decrease in Current Assets:

Inventory 1,20,000

Add: Increase in Current Liabilities:

Trade Payables 2,75,000 3,95,000

Less: Increase in Current Assets:

Trade Receivables (4,40,000)

Net Cash Flow from Operating Activities 2,84,000 2,84,000

B. Cash Flow from Investing Activities

Purchase of Plant & Machinery (7,25,000)

Net Cash used in Investing Activities (7,25,000) (7,25,000)

C. Cash Flow from Financing Activities

Proceeds from Issue of Shares 3,50,000

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Proceeds from Mortgage Loan 1,50,000

Payment of Interest on Mortgage Loan (35,000)

Payment of Interim Dividend (44,000)

Net Cash Flows from Financing Activities 4,21,000 4,21,000

Net Decrease in Cash and Cash Equivalents (20,000)

Add: Opening Balance of Cash & Cash Equivalents 40,000

Closing Balance of Cash & Cash Equivalents 20,000

Working Note:

1. Calculation of Net Profit Before Tax ₹

Profit & Loss Balance on 31st March, 2023 25,000

Profit & Loss Balance on 31st March, 2022 (20,000)

45,000

Add: Transfer to General Reserve 30,000

Interim Dividend Paid 44,000

9
1,19,000

35
*Net Cash Flow from financing activities ₹ 4,21,000 is the balancing figure of Cash Flow Statement.
3 .55
10
99

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