book-keeping & accountancy - richard's commerce

BOOK-KEEPING & ACCOUNTANCY [STD. XII]

I N D E X SR. NO. CHAPTER NAME PAGE NO.

1 PARTNERSHIP FINAL ACCOUNTS 1

2 ADMISSION OF PARTNER 13

3 RETIREMENT OF PARTNER 20

4 DEATH OF PARTNER 23

5 DISSOLUTION OF PARTNERSHIP FIRM 26

6 ACCOUNTS OF NOT FOR PROFIT CONCERNS 34

7 BILLS OF EXCHANGE 41

8 COMPANY ACCOUNTS – ISSUE OF SHARES 49

RICHARD’S COMMERCE CLASSES

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1

Richard’s Commerce Classes

PARTNERSHIP FINAL ACCOUNTS

Dr. Trading account for the year ended 31st March…… Cr.

Particulars Amt. Amt. Particulars Amt. Amt.

To opening stock To purchases Less: purchase return(return outwards) To wages To wages and salaries To freight To carriage inwards To octroi To import duty To custom duty To dock charges To works Manager salary To power, fuel, oil To coal, gas, water To royalty To factory rent To factory insurance To motive power To heating and lighting To trade expenses To gross profit transferred To profit and loss A/c

XXX XXX

XXX

XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX

By sales Less: sales returns (return inwards) By goods destroyed by fire/theft By goods withdrawn for personal use (drawings) By goods distributed as free samples By closing stock By gross loss transferred By profit and loss A/c

XXX XXX

XXX XXX

XXX XXX XXX XXX XXX

XXX

Dr. Profit and Loss A/c for the year ended 31st March….. Cr.

Particulars Amt. Amt. Particulars Amt. Amt.

To gross loss b/d (transferred from trading A/c) To salaries To salaries and wages To unproductive wages To office expenses To general expenses To sundry expenses To printing and stationary To postage and telegram To telephone charges To electricity charges To legal charges To audit fees To bank charges To interest paid To warehouse rent To rent, rates and taxes To insurance To trade expenses To travelling expenses To discount allowed To advertisement To export duty To carriage outward To packing charges To conveyance To bad debts Add: new bad debts Add: new R.D.D. Less: old R.D.D. To provident fund contribution To repairs and renewals To interest on capital To salary to partners To commission to partners To interest on partners loan To net profit transferred to partners capital/current accounts X Y

XXX XXX XXX XXX XXX

XXX XXX

XXX

XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX

XXX XXX XXX XXX XXX XXX XXX

XXX XXX

By gross profit b/d (transferred from trading A/c) By interest received By discount received By commission received By dividend received By rent received By other receipts By profit on sale of assets By interest on investments By old R.D.D. Less: old bad debts Less: new bad debts Less: new R.D.D. By interest on drawings By net loss transferred to partner’s capital/current accounts X Y

XXX XXX XXX XXX

XXX XXX

XXX

XXX XXX XXX XXX XXX XXX XXX XXX

XXX XXX

XXX

XXX

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Following is the specimen of a Balance Sheet

BALANCE SHEET OF M/S….

AS ON 31ST MARCH…

Particulars Partner’s Capital A/c X Y Partner’s Current A/c X Y Sundry Creditors Bills Payable Bank Overdraft Bank Loan Partner’s Loan Other Loans Outstanding Expenses Pre-received incomes (Income received in advance) Reserve fund Provident fund

Total

Amt Amt XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXXX

Particulars Goodwill Land and Building Freehold Property Leasehold Property Plant and Machinery Furniture and Fixtures Patents Copy-rights Trade Mark Motor Vehicles Investments Provident fund Investment Interest Accrued on Investment Loans and advances Loose Tools Sundry Debtors Bills Receivable Closing Stock Stock of Stationery Cash at bank Stock of Postal Stamps Prepaid Expenses Outstanding Incomes (Incomes receivable) Insurance claim receivable Partner’s current A/c (Debit Balance)

Amt Amt XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXX XXXX

A B c d e f g

Adjustments Closing Stock Outstanding Expenses Prepaid Expenses Income Received in Advance (Pre-received income) Income Receivable (Outstanding Income) Bad Debts (Additional or New Bad Debts) Provision for Doubtful Debts (Reserve for Doubtful Debts, New R.D.D)

1st Effect Balance Sheet Asset side Add to that particular expenses on the debit side of Trading/Profit and Loss A/c Balance Sheet Asset Side Deduct from that particular income on the credit side of particular side of P& L A/c Balance Sheet Asset Side Show to the debit side of profit and loss A/c (Add to old bad debts) Show to the debit side of profit and loss A/c (Add to old bad debts)

2nd Effect Trading A/c Credit side Balance Sheet Liability Side Deduct from that particular expenses on the debit side of Trading/P&L A/c Balance Sheet Liability Side Add to that particular Income on the Credit side of Profit and Loss A/c Deduct from sundry debtors in Balance sheet asset side Deduct from sundry debtors in Balance Sheet Asset side

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h (i) (ii) I j (i) (ii) K l (i) (ii) M N O p (i) (ii) q (i) (ii) R S t (i) (ii) u

Reserve for Discount on Debtors Reserve for Discount On Creditors Depreciation Interest on Capital Interest on Drawings Interest on Investment and on loans given Insured Goods destroyed by fire/accident Uninsured Goods destroyed by fire/accident Goods stolen Goods distributed as free samples Goods withdrawn by Partner’s for personal use) Unrecorded Purchases Unrecorded Sales Capital Expenditure included in revenue expenditure Revenue expenditure included in capital expenditure Bills Receivable dishonoured Bills Payable dishonoured Deferred expenses of Advertisement paid for 5 years Revenue receipts included in capital receipts e.g. sales of goods included in sale of furniture Commission to partners as percentage of gross profit/sales

Show to the debit side of Profit and Loss A/c (Add to discount received) Deduct from sundry creditors in Balance Sheet Liability Side Show on the debit side of the P&L A/c Show to the debit side of Profit and Loss A/c Show to the debit side of partner’s capital/current A/c or Less from Capital Balance Sheet Asset side Balance Sheet asset side (claim amount) Profit and Loss A/c (loss amount) Profit and Loss A/c Debit side Profit and loss A/c debit side Profit and Loss A/c debit side (Add in Advertisement) Partners capital/ current A/c debit side Add to purchases on the debit side of the Balance Sheet Add to Debtors on the asset side of the Balance Sheet Add to that particular asset in Balance Sheet Asset Side Add to that particular Revenue expenditure Add the amount of bill dishonoured to sundry debtors in the Balance Sheet Asset side Deduct the amount of bill dishonoured from bills payable Advertisement related to current year debited to profit and loss A/c Add to furniture on the asset side of the Balance Sheet Show to the debit side of profit and loss A/c

Deduct from sundry debtors Balance Sheet Asset side Show to the credit side of P&L A/c (Add to discount received) Deduct from that particular asset in Balance Sheet Asset side Partner’s capital/current A/c credit side or add to capitals Show to the credit side of Profit and Loss A/c Show to the credit side of Profit and Loss A/c Trading A/c – Credit side (Gross Amount) Show to the credit side of Trading A/c Show to the credit side of Trading A/c Show to the credit side of Trading A/c Show to the credit side of Trading A/c or deduct from Purchases A/c Add to creditors on the liability side of Balance sheet Add to sales on the credit side of Trading A/c Deduct from that particular revenue expenses on the debit side of Trading or Profit and Loss A/c Deducted from that particular Asset in Balance Sheet Deduct the amount of bill dishonoured from Bills Receivable Add the amount of bill dishonoured to sundry creditors in the Balance Sheet liability side Remaining amount of advertisement is shown on asset side of the Balance Sheet as Prepaid Advertisement Add to the sales on the Credit side of Trading A/c Show to the Credit side of partner’s capital/current A/c or add to partner’s capital A/c

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1. From the following Trial Balance of M/s Ganesh and Kartik, you are required to prepare trading and Profit and Loss Account for the year ended 31st March, 2011 and Balance Sheet as on that date after taking into account the additional information.

Trial Balance as on 31st Match, 2011

Debit Balance Opening Stock Purchases Wages Carriage Inward Cash in hand Insurance Postage and Telegram Sundry Debtors Land and Building Furniture Travelling expenses Discount allowed Bad Debts Bills Receivable

Amt 18,000

24,000 2,400 1,200 3,800 1,200 700

21,000 40,000 28,000 1,300 900

2,000 8,000

1,52,500

Credit Balance Capital A/c- Ganesh Kartik Sundry Creditors Bills Payable Rent Received Sales

Amt 50,000 30,000 10,000 7,800 2,200

52,500

1,52,500

Additional Information: 1) Closing sock on 31st March, 2011 was valued at Rs. 20,000 2) Outstanding wages was Rs. 1,000 3) Depreciation furniture by 10% 4) Insurance paid in advance Rs. 300 2. From the following Trial Balance and adjustments given below, you are required to prepare Trading and Profit and Loss Account

for the year ended 31st March, 2010 and a Balance Sheet as on that date of M/s Sonal and Minal. Trial Balance as on 31st March, 2010

Debit Balance Opening Stock Cash in hand Discount allowed Salaries Land and Building Furniture Plant and Machinery Sundry Debtors Interest paid Bad Debts Printing and Stationery Purchases Wages Sales Return

Amt

18,000 2,400 900 1,300

50,000 18,000 22,000 25,000 850 650 1,200 32,000 2,800 1,800 1,76,900

Credit Balance Capital A/c - Sonal Minal Sales Sundry Creditors Bills Payable Bank Loan Discount received Purchases Return

Amt 35,000 35,000 47,200 29,000 7,000 20,000 1,500 2,200

1,76,900

Adjustments: 1) The stock in hand on 31st March, 2010 was Valued at Rs. 29,000 2) Outstanding salary was Rs. 700 3) Wages paid in advance to workers Rs. 1,200 4) Depreciate Land and Building at 5% p.a. and Plant and Machinery at 10% p.a. 5) Write off Rs. 1,000 for further Bad debts. 3. Following is the Trial Balance of M/s Ram and Gopal as on 31st March, 2009

Trial Balance as on 31st March, 2009

Debit Balance Sundry Debtors Postage and Telegram Machinery Opening Stock Furniture Purchases Wages Salaries Carriage Inward Carriage Outward Rent Paid Bad Debts Cash in hand Motor Car

Amt

28,000 1,000 30,000 32,000 25,000 76,500 12,000 7,000 1,000 2,000 1,500 1,700 8,000 20,000

2,45,700

Credit Balance Ram’s Capital A/c Gopal’s Capital A/c Bills Payable Sundry Creditors Sales Bank Loan Outstanding Wages

Amt

50,000 40,000 4,000 15,000

1,18,700 15,000 3,000

2,45,700

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Profit sharing ratio of Ram and Gopal is 3:2. Prepare Trading and Profit and Loss Account for the year ended 31st March, 2009 and Balance Sheet as on that date after taking into consideration the following adjustments.

1) The closing Stock is valued at cost price Rs. 45,000 while its market price is Rs. 50,000. 2) Outstanding expenses were – Salaries Rs. 800, Rent Rs. 500. 3) Provide depreciation on Machinery at 15% and Furniture at 10% p.a. 4) Goods costing Rs. 3,000 distributed as free sample. 5) Interest on Bank loan is Payable Rs. 1,500. 4. Raja and Rani are partners of ‘Maharaja Traders’. They decided to share profits and losses in the ratio of 3:2. From the following

Trial Balance and additional information, you are required to prepare Trading and Profit and Loss Account for the year ended 31st March, 2013 and Balance Sheet as on that date.


Particulars Purchases and Sales Sundry Debtors and Creditors Bills Receivable and Bills Payable Opening Stock Land and Building Work’s Manager Salary Motive Power Plant and Machinery Audit Fees Salaries and Wages Trade expenses General expenses Wages and Salaries Loose Tools Prepaid rent Capital A/c- Raja Rani Raja’s loan A/c Commission Received

Debit Amt 90,500 34,000 35,000 34,600

1,20,000 4,700 5,500 80,000 3,400 14,500 2,100 1,800 20,700 10,000 4,500

- - - -

4,61,300

Credit Amt 1,20,300 45,500 32,000

- - - - - - - - - - - -

1,50,000 1,00,000 11,000 2,500

4,61,300

Additional Information: 1) Stock on hand on 31st March, 2013 was cost Rs. 42,000 and its market price was Rs. 45,000. 2) Audit Fees paid in advance of Rs. 1,500. 3) Motive Power includes Rs. 3,000 paid for deposit of power meter. 4) Goods worth Rs. 2,500 taken by Raja for his personal use are not entered in the books of account. 5) Bills payable dishonoured of Rs. 2,500. 6) Depreciate plant and machinery at 5% p.a. and loose tools at 10% p.a. 7) Commission includes, pre-received amount of Rs. 1,000. 5. From the following Trial Balance of M/s Sharma and Varma, you are required to prepare a Trading and Profit and Loss Account

for the year ended 31st March, 2013 and Balance Sheet as on that date after taking into consideration the additional information given below. Partners share profits and losses in their capital ratio.


Debit Balance Stock on 1st April, 2012 Purchases Salaries Unproductive Wages Carriage Royalties Freight Printing and Stationery Sundry Debtors Furniture Leasehold property Investment Travelling expenses Advertisement (for 3 years) Bad Debts Discount Allowed Cash in hand

Amt 28,000 1,75,000 17,500 1,800 1,200 2,500 1,400 2,100 40,000 20,000 95,000 35,000 1,750 4,275 1,425 800 7,000

4,34,750

Credit Balance Capital A/c- Sharma Varma Sundry Creditors Rent received Bank Overdraft Sales

Amt 90,000 60,000 30,000 3,500 24,500

2,26,750

4,34,750

Additional Information:

1) Stock on hand on 31st March, 2013 was at cost Rs. 38,000. 2) Provide R.D.D at 5% on Sundry Debtors and reserve for discount on debtors at 3%. 3) Goods worth Rs. 5,000 destroyed by fire and insurance company admitted a claim of Rs. 4,300. 4) Rent of Rs. 800 is still receivable from the tenant. 5) Depreciate Furniture at 12% p.a.

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6. Rane and Chavan are partners sharing profits and losses in the ratio of 7:6. From the following Trial Balance and Additional information prepare Trading and Profit and Loss Account for the year ended 31st March, 2012 and Balance Sheet as on that date.

Trial Balance as on 31st Mach, 2012

Debit Balance Opening Stock Bills Receivable Wages and Salaries Sundry Debtors Purchases Building Discount General expenses Audit fees Bad debts Cash at Bank Travelling Expenses Motor Car Trade expenses Rent for 9 months

Amt 44,000 28,000 12,000 52,000

1,30,000 80,000 1,400 3,800 4,000 3,500 11,500 4,200 45,000 4,300 4,500

4,28,200

Credit Balance Reserve for Doubtful Debts Sundry Creditors Sales General Reserve Outstanding Salaries Capital A/c - Rane Chavan

Amt 2,100 55,400

2,00,000 28,000 2,700 80,000 60,000

4,28,200

Adjustments: 1) Closing stock is valued at Rs. 42,000. 2) Bills Receivable included dishonour bill of Rs. 4,000. 3) Goods worth Rs. 2,100 were taken by Rane for his personal use was not entered in the books of accounts. 4) Goods worth Rs. 4,000 were sold on 27th March, 2012, but no entry was made in the books of accounts. 5) Write off 2,000 for bad debts and maintain R.D.D. at 5% on Sundry debtors. 6) Travelling expenses includes personal travelling expenses of Mr. Chavan of Rs.800. 7) Depreciate building at 7% p.a. 7. M/s Vijay Raj Traders is a Partnership Firm in which Vijay and Raj are Partners sharing profits and losses in the ratio of 8:7. From

the following Trial Balance prepare Trading and Profit and Loss Account for the year ended 31st March, 2013 and Balance Sheet as on that date.


Particulars Capital A/c - Vijay - Raj Current A/c - Vijay - Raj Purchases and Sales Sundry Debtors and Creditors Bills Receivable and Bills Payable Commission Opening Stock Cash in hand 10% Government Bonds (Purchased on 1.1.2013) Rent and Taxes Building Furniture Salaries Wages Insurance Motor Car Bad debts

Debit Amt - - -

1,500 1,42,000 80,000 12,000 3,000 27,000 3,500 20,000 2,390 70,000 15,000 21,000 8,000 3,600 10,000 1,000

4,19,990

Credit Amt 72,000 63,000 2,490

- 2,13,000

47,500 19,500 2,500

4,19,990

Adjustments: 1) Stock on hand on 31st March, 2013 was valued at Rs. 35,000. 2) Vijay is allowed a salary of Rs. 3,500 and Raj is entitled to get commission at 2% on sales. 3) Interest on partners’ capital @ 15% is to be provided. 4) Depreciate Furniture at 5% and Building at 10% p.a. 5) Rs. 2,000 due from customer is not recoverable. 6) Insurance is paid for the year ended on 30th June, 2013. 7) Prepaid commission is Rs. 1,000 and pre-received commission is Rs. 700.

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8. Tambe and Pitale are partners sharing profits and losses equally. From the following Trial Balance and adjustments, prepare Trading and Profit and Loss Account for the year ended 31st March, 2012 and Balance Sheet as on that date.


Debit Balance Land and Building Machinery (Addition on 1st July, 2011 Rs. 10,000) Opening Stock Wages Cash at Bank Sundry Debtors Purchases Carriage Rent, Rates and Taxes Furniture and Fixture Salaries Current A/c – Pitale Drawing A/c - Tambe Pitale

Amt 75,000 55,000

23,000 5,750 3,500 32,800 63,000 1,250 2,400 26,600 3,500 2,450 5,000 4,000

3,03,250

Credit Balance Capital A/c - Tambe Pitale Sales Sundry Creditors 10% Bank loan (Taken on 1st Oct, 2011) Current A/c – Tambe Pre-received rent Provident Fund

Amt 70,000 50,000 85,000 44,250 20,000

1,500 2,500 30,000

3,03,250

Adjustments: 1) Closing stock is valued at Rs. 20,000. 2) Goods worth Rs. 2,000 were purchased on 31-3-2012 and included in closing stock but not recorded in the books of account. 3) Goods worth Rs. 2,500 were sold, but not recorded in the books of accounts. 4) Provide interest on partner’s capitals @ 12%. 5) Provide interest on partner’s drawings @ 10%. 6) Depreciate Machinery @ 15% p.a. 9. Sachin and Nilesh are partners sharing profits and losses equally. From the following Trial Balance and adjustments. You are

required to prepare a Trading and Profit and Loss Account for the year ended 31st March, 2010 and Balance Sheet as on that date.


Debit Balance Drawings: Sachin Nilesh Sundry Debtors Cash at Bank Land and Building Opening Stock Import Duty Audit fees Wages Brokerage Motor Van Machinery 12% Debentures Factory rent Salaries Purchases

Amt 5,000 4,000 45,000 22,800 75,000 38,200 6,400 3,750 4,150 2,400 40,000 32,000 25,000 2,250 7,500

1,02,500 4,15,950

Credit Balance Capital A/c - Sachin Nilesh Current A/c - Sachin Nilesh Sundry Creditors Bank Overdraft Sales

Amt 70,000 60,000 4,750 3,800 52,500 17,250 2,07,650

4,15,950

Adjustments: 1) Stock on hand on 31st March, 2010 was valued at Rs. 41,000. 2) Outstanding expenses were: Salary Rs. 1,500, Audit fees Rs. 1,250. 3) Interest on partner’s capital at 5% p.a. Is allowed while interest on drawings is charged at 4% p.a. 4) Depreciate Machinery at 12.5% and Motor Van 8% p.a. 5) Sachin is entitled to get salary at Rs. 400 per month and Nilesh is to get commission 4% commission on Gross Profit. 6) Sales includes, sale of machinery of Rs. 2,000 which is sold on 1st April, 2009. 7) Debentures purchased on 1st Oct, 2009.

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10. Ramdeo and Mahadeo are partners sharing profits and losses in the ratio of 2:1. From the following Trial Balance and adjustments, prepare Trading and Profit and Loss Account for the year ended 31st March, 2011 and Balance Sheet as on 31st March, 2011.


Debit Balances Opening Stock Furniture and Fixture Cash in hand Bad debts Salaries and Wages Purchases Sundry Debtors Printing & Stationery Land and Building Carriage Inward Goodwill Provident fund contribution Advertisement (for 3 years) W.e.f. 1st Oct, 2010 Provident fund investment Shares in B Ltd.

Amt 20,250 15,000 1,802 1,250 9,750 87,500 41,500 1,900 75,000 1,748 30,000 1,250 4,800

19,000 13,000

3,23,750

Credit Balance Sales Sundry Creditors Dividend received Provident fund Interest on P.F. Investment Capital A/c - Ramdeo Mahadeo

Amt 1,47,500 33,500 4,000 17,500 1,250 80,000 40,000

3,23,750

Adjustments: 1) Stock on hand on 31st March, 2011 was valued at Rs. 25,000. 2) Rs. 2,000 paid during the year as Building repairs wrongly debited to Building account. 3) Stock of stationery as on 31st March, 2011 was Rs. 200 4) Maintain R.D.D at 5% on Sundry Debtors. 5) Reserve for discount on Debtors and Creditors are to be made at 3% and 4% respectively. 6) Uninsured goods worth Rs. 2,000 were destroyed by fire. 11. From the following Trial Balance of M/s Pravin and Ramesh, you are required to prepared Trading and Profit and Loss Account for the year ended 31st March, 2013 and Balance Sheet as on that date.


Debit Balance Plant and Machinery Goodwill Furniture Coal, Gas and Water Land and Building Purchases Postage and Telegrams Export Duty Wages and Salaries Rent and Taxes Cash in hand Freight Prepaid rent Sundry Debtors Insurance Opening Stock Discount

Amt 1,40,000 40,000 80,000 4,300 1,20,000 2,32,000 2,200 15,500 31,000 7,200 18,000 6,200 3,600 76,000 4,200 39,000 5,800

8,25,000

Credit Balance Capital A/c - Pravin Ramesh Sales Sundry Creditors 12% Bank loan (Taken on 1st Oct, 2012)

Amt 2,00,000 1,50,000 3,30,000 1,05,000

40,000

8,25,000

Adjustments: 1) Closing stock in hand was valued at Rs. 61,000. 2) Goods distributed as free samples were Rs. 3,000. 3) Postal stamps in hand on 31st March, 2013 were Rs. 700. 4) Provide 5% interest on capitals. 5) Prepaid insurance Rs. 900. 6) Provide Reserve for Discount @ 5% on Sundry Creditors. 7) Wages paid for installation of machinery were included in Wages A/c Rs. 5,000. Depreiate machinery at 5%.

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12. Mr. Ajit and Mr. Sujit are partners of the firm sharing profits and losses in the ratio of 3:2. Their Trial Balance as on 31st March, 2012 was given below. Prepare Trading and Profit and Loss Account for the year ended 31st March, 2012 and Balance Sheet as on that date.


Particulars Capital A/c - Ajit Sujit Purchases and Sales Sundry Debtors and Creditors Interest Opening Stock Wages Land and Building Loose Tools Power, Fuels and Oil Export Duty Salaries Electricity Charges Investments Reserve fund Ajit’s loan A/c Bank Overdraft Patents Administrative Expenses Cash in hand Heating and Lighting

Debit Amt

62,750 24,000 2,900 21,500 8,500 75,000 15,000 2,750 1,200 10,800 1,400 24,000

- - -

32,000 4,300 2,000 1,900

2,90,000

Credit Amt 50,000 40,000 1,22,000 47,000 2,000

- - - - - - - - -

8,000 10,000 11,000

- - - -

2,90,000

Adjustments: 1) Stock on hand on 31.3.2012 was valued at Rs. 17,000. 2) 1/8th of the patents are to be written off. 3) Goods of Rs. 7,000 destroyed by fire and insurance company admitted a claim of Rs. 6,100. 4) Rs. 1,000 received on account is commission wrongly included in Ajay’s Loan Account. 5) Provide 8% Depreciation on Land and Building and 5% on Loose Tools. 6) Outstanding expenses were: Salaries Rs. 1,200 Electricity charges Rs. 1,800. 7) Our customer, Mr. Rakesh failed to pay his due of Rs. 1,000. 13. Dhanesh and Ganesh are partners sharing profits and losses in their capital ratio. From the following Trial Balance and adjustments given below, you are required to prepare Trading and Profit and Loss Account for the year 31st March, 2011 and Balance Sheet as on that date.


Debit Balance Stock on 1st April, 2010 Purchases Return Inward Carriage Motive Power Wages Sundry Debtors Salaries Insurance Postage Commission Plant and Machinery Furniture Advertisement Office Rent (Paid for 10 months) Buildings Cash in Hand Bills Receivable

Amt 88,000 3,40,000 20,000 8,000 12,000 1,12,000 1,44,000 76,000 4,800 7,200 10,000 1,20,000 32,000 16,000 20,000

48,000 6,000 48,000

11,12,000

Credit Balance Sales Sundry Creditors Bills Payable Capital A/c - Dhanesh Ganesh

Amt 6,40,000 80,000 72,000 1,92,000 1,28,000

11,12,000

Adjustments: 1) Closing stock was valued at market price of at Rs. 1,76,000 which is 10% above the cost. 2) Depreciate Plant and Machinery and Building at 20% and 10% respectively. 3) Goods withdrawn by Dhanesh of Rs. 20,000 during the year were not recorded in the books of accounts. 4) Bad debts were Rs. 4,000 and provide for R.D.D at 5% on Sundry Debtors. 5) Goods worth Rs. 12,000 were purchased and included in Bills Receivable; however balances of Debtors and Creditors were taken correctly.

10


14. From the following Trial Balance of M/s Ajay and Vijay, you are required to prepare Trading and Profit and Loss Account for the year ended 31st March, 2009 and Balance Sheet as on that date.


Particulars Capital A/c - Ajay Vijay Purchases and Sales Sundry Debtors and Creditors Bills Receivable and Payable Commission Opening Stock Wages Investment Postage and Telegram Insurance Plant and Machinery Furniture Cash in hand Carriage Bad debts Prepaid Rent Salaries

Debit Amt

46,700 28,000 5,000 4,600 18,000 9,900 13,500 3,600 1,200 40,700 18,000 2,500 3,200 400 7,000 10,500

2,12,800

Credit Amt 60,000 35,000 85,000 25,000 6,000 1,800

2,12,800

Adjustments: 1) The closing stock is valued at Rs. 31,000. 2) Sale of machinery Rs. 5,000 wrongly included in sale of goods. 3) Depreciate Plant and Machinery by 10%. 4) Insurance at Rs. 500 is paid in advance. 5) Provide for further bad debts of Rs. 1,500. 6) Commission due but not received Rs. 1,200. 15. Sanjay and Sudhir are partners sharing Profits and Losses in the ratio 3:2. The Trial Balance of the firm on 31st March, 2010 was as follows:


Particulars Opening stock Purchases Debtors Wages Salaries Land and Building Plant and Machinery Furniture Advertisement ( for 2 years) Bills Receivable Insurance Drawings - Sanjay Sudhir Cash in hand Rent Power and Fuel

Amt 20,000 30,000 12,000 5,000 10,000 30,000 25,000 16,000 6,000 8,000 2,000 2,000 3,000 5,500 10,000 3,000

1,87,500

Particulars Capital A/c - Sanjay Sudhir Sales Sundry Creditors Bills Payable Discount Outstanding Rent

Amt 40,000 30,000 70,000 21,000 20,000 5,000 1,500

1,87,500 Adjustments: 1) Stock on hand on 31st March, 2010 as at Rs. 35,000. 2) Write off Rs. 2,000, for further Bad Debts. 3) Provide reserve for discount on creditors @ 5%. 4) Provide interest on drawings: Sanjay – Rs. 200; Sudhir – Rs. 300. 5) Credit purchases amounted to Rs. 4,000 were not recorded in the books of accounts. 6) Provide interest on parteners’ capital at 5% Prepare Tading ang Profit and Loss Account for the year ended 31st March, 2012 and Balance Sheet as on that date.

11


16. Rohan and Roshan are partners in ‘Shan Traders’ sharing profits and losses in the ratio of 2:1. From the following Trial Balance and adjustments prepare Trading and Profit and Loss Account for the year ended 31st March, 2011 and Balance Sheet as on that date.


Particulars Opening stock Purchases Plant and Machinery Furniture Carriage Wages and Salaries Bills Receivable Sundry Debtors Conveyance Rent, Rates and Taxes Return Inward Cash in Hand Land and Building Bad Debts Patents

Amt 32,000 64,000 30,000 18,500 1,500 35,000 5,000 32,000 4,000 2,000 3,500 14,750 83,500 1,750 25,000

3,52,500

Particulars Sales Sundry Creditors Unpaid Wages Return Outward Capital A/c - Rohan Roshan

Amt 1,93,500 15,000 1,500 2,500 90,000 50,000

3,52,500

Adjustments: 1) Closing stock: Cost price Rs. 25,000 and market price Rs. 30,000. 2) An amount of Rs. 3,500 spent for repairs to Building is debited to Building account. 3) Depreciate Plant and Machinery and Building at 5% p.a. 4) Goods of Rs. 750 taken by Roshan for this personal use. 5) Included in Wages advances given to workers Rs. 3,000. 6) Provide Rs. 1,500 for Bad and Doubtful Debts on Debtors. 17. Given below is the Trial Balance of M/s Roma and Mona partnership firm. Prepare Trading and Profit and Loss Account for the year ended 31st March, 2012 and Balance Sheet as on that date.


Debit Balance Stock on 1st April, 2011 Sundry Debtors Bad Debts Premises Salaries Motor Vehicle Purchases Provident fund Investment Provident fund Contribution Wages Rent ( for 10 months) Office expenses Discount allowed

Amt 52,000 84,000 3,000 78,000 28,000 50,000 1,76,000 50,000 5,500 22,000 16,000 5,000 2,500

5,72,000

Credit Balance Provident fund Interest on P.F. Investment Sundry Creditors Rent Received Reserve for Doubtful Debts Discount Received Sales Capital A/c - Roma Mona

Amt 50,000 2,800 84,000 9,600 2,000 3,600

3,20,000 50,000 50,000

5,72,000

Adjustments: 1) Stock on 31st March, 2012 was valued at Rs. 80,000. 2) Goods of Rs. 6,000 were sold and dispatched on 27th March, 2012, but no entry was made in the books of accounts. 3) Write off Bad debts of Rs. 4,000 and provide for R.D.D at 5% on sundry debtors. 4) Provide reserve for discount on debtors at 2% and on creditors at 3%. 5) Outstanding Wages Rs. 4,000 and outstanding salaries Rs. 3,066. 6) Depreciate Motor Vehicle at 5% p.a.

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18. From the following Trial Balance of M/s Kale and Gore, you are required to prepare Trading and Profit and Loss Account for the year ended 31st March, 2013 and Balance Sheet on that date. They share profits and losses in their capital ratio.


Debit Balance Opening stock Purchases Trade expenses Royalties Wages and Salaries Advertisement Salaries Plant and Machinery Freehold Machinery Office Rent Motor Van Bills Receivable Sundry Debtors Cash in hand Bad debts General Expenses

Amt 28,000

1,16,400 2,400 6,200

14,800 8,200

11,000 44,000 36,000 4,000

63,000 16,000 60,000 10,000 1,000 2,800

4,23,800

Credit Balance Capital A/c - Kale Gore Sundry Creditors Sales Reserve for Doubtful Debts Bills Payable

Amt 80,000 40,000 54,000

2,12,000 1,800 36,000

4,23,800

Adjustments: 1) Closing stock was valued at cost Rs. 76,000 while its market price was Rs. 80,000. 2) Uninsured goods worth Rs. 10,000 were stolen. 3) Goods worth Rs. 10,000 were sold and delivered on 31st March, 2013, but no entry is passed sales book. 4) Depreciate Plant and Machinery at 10% and Motor Van at 15% p.a. 5) Bills Receivable includes a dishonoured bill of Rs. 4,000. 6) Create a reserve for doubtful debts at 5% on Debtors. 19. Given below is the Trial Balance of M/s Seeta and Geeta as on 31st Match, 2010. You are required to prepare Trading and Profit and Loss Account for the year ended 31st March, 2010 and Balance Sheet as on that date.


Debit Balance Current A/c - Geeta Opening stock Purchases Wages Salaries Office expenses Bank Charges Legal Charges Machinery Land and Building Interest Export Duty Bad Debts Sundry Debtors Travelling Expenses Electricity charges Furniture 8% Debentures (Purchased on 1.10.2009)

Amt 4,000 88,000 1,76,000 23,500 15,000 8,000 2,600 3,000 90,000 1,30,000 3,600 3,800 4,000 82,000 3,200 2,300 37,000 40,000

7,16,000

Credit Balance Capital A/c - Seeta Geeta Current A/c - Seeta Sundry Creditors Bank Overdraft Sales

Amt 1,20,000 1,20,000 5,000 1,03,000 60,000 3,08,000

7,16,000

Adjustments: 1) Stock on hand on 31st March, 2010 was valued at Rs. 80,000. 2) Goods costing Rs. 16,000 destroyed by fire and insurance company admitted a claim of Rs. 13,000. 3) Provide for outstanding expenses: Salaries Rs. 3,000, Wages Rs. 2,400. 4) Depreciate Machinery at 10% p.a. Land and Building at 5% p.a. 5) Create Reserve for Bad and Doubtful debts at 5% on Sundry Debtors. 6) Legal charges paid in advance Rs. 1,200. 7) Provide interest on capital at 8% p.a.

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20. Madhuri and Minakshi are in partnership sharing profits and losses in the ratio 3:2. From the following Trial Balance and adjustments given below, you are required to prepare Trading and Profit and Loss Account for the year ended 31st March, 2012 and Balance Sheet as on that date.


Debit Balance Building Plant and Machinery Purchases Carriage Opening stock Wages Sundry debtors Salaries Postage and Telegram Insurance Bad Debts Rent Discount Drawings A/c - Madhuri Minakshi

Amt 4,00,000 1,20,000 6,50,000 7,000 90,000 35,000 1,50,000 28,000 4,000 5,000 3,000 4,000 3,200 10,000 5,000

15,14,200

Credit Balance Capital A/c - Madhuri Minakshi Sales Sundry Creditors Outstanding Salaries 8% Bank Loan (Taken on 1.10.2011)

Amt 3,00,000 2,00,000 8,10,000 1,00,000 4,200 1,00,000

15,14,200

Adjustments: 1) Stock on hand on 31st March, 2010 was valued at Rs. 1,10,000. 2) Depreciate Plant and Machinery at 10% p.a. and Building at 5% p.a. 3) Prepaid Insurance Rs. 1,500. 4) Create R.D.D at 5% on Sundry Debtors. 5) Partners are allowed interest at 5% p.a. on their capitals. 6) Salaries include Rs. 2,500 as advance to workers.

ADMISSION OF PARTNER

1. The Balance Sheet of Shekhar and Shridhar as on 31st March, 2012 is set out below; they share P&L in the ratio of 3:2.

Balance Sheet as on 31st March, 2012

Liabilities Capital Accounts Shekhar Shridhar General Reserve Creditors

Amt

80,000 60,000 48,000 32,000

2,20,000

Assets Building Furniture Stock Debtors Cash Profit & Loss A/c

Amt 40,000 20,000 24,000 80,000 36,000 20,000

2,20,000

They agreed to admit Murlidhar as a partner into the firm on the following terms: 1) He should bring Rs. 24,000 as capital and Rs. 18,000 as goodwill, which is to be retained in the business. He will be entitled to 1/4th share in future profits of the firm. 2) 50% of General Reserve is to remain as Reserve for Doubtful Debts. 3) Stock is to be revalued at Rs 30000 4) Furniture is to be depreciated by 5% 5) Creditors of Rs. 2,000 are not likely to claim and hence should be written off. 6) Rent of Rs. 1,000 due but not received and it has not been recorded in the books. Prepare Revaluation A/c, partners’Capital A/cs and Balance Sheet of the new firm.

2. Paresh and Naresh were partners sharing P&L in the ratio of 3/5 and 2/5. On 31st March, 2012 their balance sheet was as follows:

Balance Sheet as on 31st March, 2012 Liabilities

Sundry Creditors Reserve Fund Capital A/c’s Paresh Naresh

Amt 30,000 10,000

72,000 48,000

1,60,000

Assets Cash Sundry Debtors 45,000 Less : R.D.D 500 Stock Investments Plant Building

Amt 500

44,500 17,000 24,000 30,000 44,000

1,60,000

On 1st April, 2012 Dinesh was admitted to partnership on the following terms: 1) Dinesh should bring Rs. 36,000 as capital for 1/5th share in future profits. 2) Valuation of Goodwill of the firm was to be made as 2 ½ years purchase of the average profit of the last three year which were as

follows: 1st year – Rs. 32,000, 2nd year – Rs. 54,000 and 3rd year – Rs. 49,000. Dinesh is to bring the goodwill in cash equal to his share in future profits.

3) R.D.D is to be raised upto Rs. 1,000. 4) Closing stock is to be valued at Rs. 15,000. 5) Building to be depreciated by 5%. Pass necessary journal entries in the books of the firm and prepare Balance Sheet after the admission of Dinesh.

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3. Arun and Varun share profits and losses in the ratio of 3:2 in partnership firm. Their balance sheet as on 31st March, 2011 was as follows.


Liabilities Creditors Bills Payable Bank Loan General Reserve Capital A/c’s Arun Varun

Amt

30,000 24,000

Amt 25,000 20,000 32,000 5,000

54,000

1,36,000

Assets Cash in hand Bills Receivable Debtors Less : R.D.D Stock Furniture Machinery Building

Amt

41,600 1,600

Amt 5,000 7,600

40,000 24,000 9,400

20,000 30,000

1,36,000

On 1st April, 2011, they admitted Tarun on the following terms: 1) For 1/5th share in future profits, Tarun should bring Rs. 20,000 for his capital and Rs. 10,000 for goodwill in cash. 2) Half of the amount of goodwill be withdrawn by old partners. 3) The stock is to be depreciated by 10% and Machinery by 5%. 4) R.D.D to be maintained at Rs. 2,000. 5) Furniture should be appreciated upto Rs. 10,700 and building be appreciated by 20%. Pass the necessary journal entries and open Revalution A/c and Cash A/c in the books of the firm.

4. Anand and Sadanand are partners in a firm sharing profits and losses in the proportion of their Capitals. Their Balance Sheet as on 31st March, 2010 was as follows:


Liabilities Capital A/c’s Anand Sadanand Sundry Creditors General Reserve

Amt

90,000 60,000 15,000 30,000

1,95,000

Assets Land and Building Plant and Machinery Furniture and Fixture Stock Sundry Debtors Cash

Amt 75,000 30,000 12,000 24,000 36,000 18,000

1,95,000

On 1st April, 2010 they admitted Swanand into partnership on the following terms. 1) He should bring Rs. 24,000 as his share of goodwill of which 50% amount to be withdrawn by old partners immediately. 2) He should bring in Rs. 30,000 as his capital for 1/4th shares in future profits. 3) For the purpose of Swanand’s admission, it was agreed that the assets should be revalued as under: 4) Land and Building at Rs. 90,000 Plant and Machinery at Rs. 24,000, stock at Rs. 30,000 and Furniture and Fixture at Rs. 6,000. 5) A provision of 5% on debtors is to be made against doubtful debts. Prepare Profit and Loss Adjustment A/c, Partners Capital A/c and New Balance sheet after the admission of Swanand.

5. Amit and Sumit were partners sharing and losses in the proportion of 2/3rd and 1/3rd. Their Trial Balance Sheet is as follows. Balance Sheet as on 31st March, 2011

Liabilities Capital A/c’s Amit Sumit General Reserve Profits and Loss A/c Sundry Creditors Amit’s Loan A/c

Amt

96,000 64,000

Amt

1,60,000 18,000 6,000 80,000 26,000

2,90,000

Assets Building Furniture Office Equipment Sundry Debtors Less : R.D.D Stock Cash

Amt

63,000 3,000

Amt 1,00,000 20,000 10,000

60,000 84,000 16,000

2,90,000

On 1st April, 2011 Rohit is admitted in the partnership on the following terms: 1) Rohit should bring in cash Rs. 48,000 as capital for 1/5th share in future profits. 2) Goodwill was raised in the books of the firm for Rs. 18,000. 3) Building is revalued at Rs. 1,12,000 and the value of stock to be reduced by Rs. 6,000. 4) Reserve for Doubtful debts be maintained at Rs. 1,800/- 5) Amit’s Loan is to be repaid. Prepare Revaluation A/c, Capital A/c’s of partners and Balance Sheet of the new firm.

6. Akash and Badal were partners and shared profits and losses in the ratio of 3/5 and 2/5 on 31st March, 2012 their balance sheet is as follows.

Balance Sheet as on 31st March, 2012 Liabilities

Sundry Creditors General Reserve Capital Accounts Akash Badal

Amt Amt 60,000 20,000

1,44,000 96,000

3,20,000

Assets Cash at Bank Sundry Debtors Less : R.D.D Stock Investments Plant Building

Amt

90,000 1,000

Amt 1,000

89,000 34,000 48,000 60,000 88,000

3,20,000

On 1st April, 2012 Sagar was admitted to partnership on the following terms:

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1) He should bring Rs. 42,000 as his capital. 2) Valuation of the goodwill of the firm to be made twice the average profit of last 3 years. The Profits were Rs. 48,000, Rs.52000 and Rs 80000 respectively. Sagar was unable to bring the goodwill in cash and hence goodwill was raised in the books of the firm. 3) Before admitting Sagar, R.D.D was to be raised upto Rs. 2,000. 4) Closing stock was to be valued at Rs. 32,000. 5) Half of plant was taken by Akash at book value. 6) Provide depreciation on Building at 5% p.a 7) Goodwill is written off after the admission in the new ratio i.e.5:3:2. Prepare Profit and Loss Adjustment A/c, Capital A/c of partners and Balance Sheet of the new firm.

7. Amar and Akbar sharing profits and losses in the ratio of 3:2 had the following balance sheet as on 31st March, 2012. Balance Sheet as on 31st March, 2012

Liabilities Capital Accounts Amar Akbar General Reserve Bills Payable Creditors

Amt

1,60,000 80,000 56,000 16,000 40,000

3,52,000

Assets Goodwill Building Plant Furniture Debtors Bills Payable Stock Bank

Amt 60,000 68,000 54,000 8,000 65,000 30,000 45,000 22,000

3,52,000

On 1st April, 2012 they decided to admit Anthony into the partnership by giving him 1/5th share in future profits. He brings in Rs. 1,00,000 as his capitals. The partners decided to revalue the assets as follows: Goodwill Rs. 1,00,000, Plant Rs. 50,000, Debtors Rs. 62,000, Srock Rs. 65,000, Building Rs. 80,000, Furniture Rs. 4,000 and Bills Receivables Rs. 25,000. The partners also decided not to show goodwill in the books of the new firm. Prepare Revaluation A/c, Partners Capital A/c and new Balance Sheet of the firm.

8. Manav and Satish are equal partners in a business. Their Balance Sheet stood as under. Balance Sheet as on 31st March, 2013

Liabilities Sundry Creditors General Reserve Capital Account Manav Satish

Amt

45,000 30,000

Amt 90,000 18,000

75,000

1,83,000

Assets Cash in hand Sundry Debtors Less : R.D.D Bills Receivable Machinery Building

Amt

31,000 1,000

Amt 60,000

30,000 12,000 24,000 57,000

1,83,000

They decided to admit Ajit on 1st April, 2013 on the following terms:

1) Machinery and Building be depreciated by 10% and R.D.D to be increased by Rs. 1,500. 2) Bills Receivable are taken over by Manav at a discount of 10%. 3) Ajit should bring Rs. 40,000 as a capital for his 1/4th share in future profits. 4) Goodwill should be raised in the books at Rs. 25,000. 5) The Capital Account of all the partners be adjusted in proportion of to the new profit sharing ratio by opening current A/c’s of partners. Prepare Profit and Loss AdjustmentA/c, Capital A/c of Partners and new Balance Sheet of the firm.

9. Following is the Balance Sheet of Sohan and Mohan on 31st March, 2012. They share profits and losses in the ratio of 3:2. Balance Sheet as on 31st March, 2012

Liabilities Sundry Creditors General Reserve Capitals : Sohan Mohan

Amt 2,00,000 48,000

1,40,000 1,40,000

5,28,000

Assets Cash Stock Sundry Debtors Furniture Plant and Machinery Land and Building

Amt 20,000 80,000 1,50,000 38,000 1,40,000 1,00,000

5,28,000

They decided to admit Rohan on 1st April, 2012 into partnership on the following terms:

1) He should bring Rs. 40,000 as his share of goodwill, which is to be retained in the business. 2) He should bring Rs. 50,000 as capital for 1/4th share in future profits. 3) Land and Building to be valued at Rs. 1,20,000, Plant and Machinery and Furniture to be reduced by 10%. 4) A provision of 5% on debtors to be made for doubtful debts. 5) The stock is to be taken at a value of Rs. 1,00,000. 6) The excess capital of Sohan and Mohan over their due proportion of sharing profits in the firm is to be transferred to their respective loan accounts. Prepare Profit and Loss Adjustment A/c, CapitalA/cs and New Balance Sheet of the firm.

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10. Dhiraj and Niraj are partners in a firm sharing profits and losses in the ratio 3:2. Their Balance sheet as on 31st March, 2012 was as under:


Liabilities Capital’s A/c’s - Dhiraj Niraj General Reserve Sundry Creditors Bills Payable

Amt 50,000 50,000 10,000 70,000 7,000

1,87,000

Assets Land and Building Plant and Machinery Furniture Stock Sundry Debtors Cash

Amt 35,000 49,000 2,100 28,700 63,000 9,200

1,87,000

They agreed to admit Suraj in their partnership on 1st April, 2012 on the following terms: 1) The new profit sharing ratio will be 3:1:1. 2) Suraj should bring Rs. 15,000, as his share of goodwill in the firm and Rs. 20,000 as his capital. 3) Land and Building be valued at 90% of its book value. 4) Plant and Machinery and Stock to be reduced by 5% & 10% respectively. 5) Reserve for doubtful debts to be provided as 5% on debtors. 6) The capitals of all partners are to be adjusted in their new profit sharing ratio by making adjustments in cash on the basis of new partners’ capital. Prepare Revaluation A/c, Capital Accounts and New Balance Sheet.

11. Sharad and Varad are partners in a firm sharing profits and losses in the ratio of 3:1. The following is their Balance Sheet. Balance Sheet as on 31st March, 2011

Liabilities Capital Accounts : Sharad Varad Current Accounts : Sharad Varad Sundry Creditors General Reserve

Amt 1,20,000 1,00,000 6,000 4,000 42,000 8,000

2,80,000

Assets Building Stock Sundry Debtors Cash Profit and Loss Account

Amt 1,20,000 80,000 62,000 8,000 10,000

2,80,000

Narad is admitted as a apartner on 1st April, 2011 in the firm on the following terms: 1) He should bring Rs. 80,000 as his capital for 1/4th share I future profits and Rs. 40,000 as his share of goodwill. 2) Building is found overvalued by 20% and stock is found undervalued by 20% in the books. These assets are to be adjusted at their

proper value. 3) Rs. 20,000 to be maintained as Reserve for doubtful debts. Prepare Revaluation A/c, Current A/cs of old partners and New Balance of the firm after Narads admission.

12. The Balance Sheet of Rajkumar and Rajendra Kumar as on 31st March, 2012 is set out below, they share profits and losses in the ratio of 2:1.


Liabilities Capital A/c’s – Rakjumar Rajendra Kumar General Reserve Creditors

Amt 2,00,000 1,50,000 1,20,000 80,000

5,50,000

Assets Buildings Furniture Stock Debtors Cash Profit and Loss A/c

Amt 1,00,000 30,000 60,000 3,00,000 30,000 30,000

5,50,000

They agreed to admit Dhirajkumar on 1st April, 2012 as a partner into the firm on the following terms on.

1) Dhirajkumar to bring Rs. 60,000 as capital and Rs. 45,000 as goodwill, which is to be retained in the business. He will be entitled to 1/4th share of profit of the firm. 2) 50% of General Reserve is to remain as Reserve for Doubtful debts. 3) Furniture is to be depreciated by 5%. 4) Stock is to be revalued at Rs. 65,000. 5) Creditors of Rs. 5,000 are not likely to claim and hence should be written off. 6) Rent of Rs. 2,000 due but not received has not been recorded in the books. Pass the necessary journal entries in the books of the new firm and prepare Balance Sheet of the new firm.

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13. Suresh and Ramesh are partners in a business sharing Balance Sheet as on 31st March, 2013 is as follows: Liabilities Capitals A/c’s Suresh Ramesh Creditors Bills Payable Reserve fund

Amt

50,000 24,000

Amt

74,000 57,000 20,000 9,000

1,60,000

Assets Building Machinery Furniture Debtors (-) R.D.D Stock Bills Receivable Cash at Bank

Amt

40,000 1,000

Amt 30,000 10,000 9,500

39,000 30,000 7,600 33,900

1,60,000

They admitted Kailash on 1st April, 2013 as a partner on the following terms:

1) Kailash will Bring Rs. 30,000 as his capital for 1/4th share in the future profit and Rs. 12,000 as goodwill which will be withdrawn by old partners. 2) Stock and Machinery to be depreciated by 10%. 3) R.D.D is to be maintained at 5% on debtors. 4) Building to be appreciated by 20% & furniture is revalued at Rs. 10,000. Prepare Profit & Loss Adjustment A/c, Capital A/cs and Balance Sheet of the New firm.

14. Snehal and Meenal are equal partners in a business. Their Balance Sheet is as follows: Balance Sheet as on 31st March, 2012

Liabilities Capital A/c’s Snehal Meenal Creditors Bank Loan (taken on 1.1.2012)

Amt

80,000 45,000

Amt

1,25,000 26,000 40,000

1,91,000

Assets Premises Investments Equipments Bills Receivable Debtors (-) R.D.D Profit and Loss A/c Bank

Amt

1,10,000 11,000

Amt 20,500 10,500 5,000 18,000

99,000 6,600 31,400

1,91,000

They agreed to admit Kamal on 1st April, 2012 on the following terms: 1) He should bring 50,000 towards his capital for 1/4th share in the future profits. 2) Goodwill A/c be raised in the books of the firm Rs. 40,000. 3) R.D.D to be maintained at 5% on debtors. 4) Premises to be valued at Rs. 30,000 and Equipments to be written off fuly. 5) Interest at the rate of 15% p.a. is due on bank loan. 6) Creditors allowed a discount of Rs. 11,00/- and they were paid off immediately. Pass necessary journal entries to record the above scheme of admission.

15. Following is the Blance Sheet of Harish and Girish. Balance Sheet as on 31st March, 2010

Liabilities Creditors Bills Payable Profit and Loss A/c Capital A/c Harish Girish

Amt

1,00,000 1,40,000

Amt 38,000 46,000 16,000

2,40,000

3,40,000

Assets Cash in hand Stock Debtors (-) R.D.D Equipments Furniture Plant Building

Amt

46,000 6,000

Amt 37,000 21,000

40,000 12,000 25,000 85,000 1,20,000

3,40,000

They admitted Shirish on 1st April, 2010 on the following conditions:

1) For his 1/3rd share in the future profits Shirish brings Rs. 2,00,000 as his capital. 2) It is decided to raise goodwill by Rs. 90,000 and write it off fully after Shirish’s admission. 3) Equipments and Plant to be depreciated by 20% and 10% respectively and building to be appreciated by 15%. 4) Bills Payable were retired for Rs. 35,000. 5) All debtors are considered goods. 6) Furniture of the book value Rs. 12,000 was taken over by Harsih at 40% of the book value. Prepare Revaluation A/c, Capital A/cs & Balance Sheet of the new firm.

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16. Keshav and Madhav were partners sharing the profits and losses in the ratio of 2:3 their Balance Sheet is as follows:


Liabilities Capital Accounts : Keshav Madhav Creditors

Amt

2,50,000 2,60,000 8,500

5,18,500

Assets Live Stock Building Investments Loose Tools Debtors 90,000 (-) R.D.D 18,000 Profit and Loss A/c Closing Stock Cash in hand

Amt 20,000 1,38,000 45,000 38,000

72,000 15,000 1,04,500 86,000

5,18,500

On 1st April, 2011 they admiited Uddhav on the following terms:

1) The new profit sharing ratio is equal. 2) Uddhav brings Rs. 2,00,000 as his capital and Rs. 80,000 as share of goodwill in cash. 3) Prepaid Insurance of Rs. 7,500 was not recorded in the books. 4) Loose tools were found undervalued by 5%and building was found overvalued by 15% in the books. 5) All debtors are considered as goods and out of creditors Rs. 500 is no longer payable. 6) The market value of investment is 50% more than its book value. Prepare Profit & Loss adjustment A/c, Capital A/cs and Balance Sheet.

17. Raj and Dev are partners sharing profits and losses 3:2 respectively. Their position on 31st March, 2011. Balance Sheet as on 31st March, 2011

Liabilities Capital A/c’s - Raj Dev Creditors Bills Payable General Reserve

Amt 1,00,000 75,000 10,000 5,000 15,000

2,05,000

Assets Buildings Furniture Stock Debtors 50,000 (-) R.D.D 1,000 Bank Balance

Amt 1,00,000 10,000 31,000

49,000 15,000

2,05,000

On 1st April, 2011 they admitted Manoj on the following terms: 1) Manoj should bring in cash Rs. 1,00,000 as a capital for 1/5th share in future profits and Rs. 25,000 as goodwill. 2) Building should be revalued for Rs. 1,25,000. 3) Depreciate furniture at 12 ½% p.a. and stock at 10% p.a. 4) R.D.D should be maintained as it is. 5) The capital accounts of partners should be adjusted in their new profits sharing ratio through bank account. Prepare Revaluation A/c, Capital A/cs, Balance Sheet and show how you have calculated new ratio & new capital.

18. Following is the Balance Sheet of Shiraj and Niraj who shared profits and losses equally. Balance Sheet as on 31st March, 2013

Liabilities Capital A/c’s Dhiraj Niraj Creditors Bills Payable General Reserve

Amt

1,25,000 35,000 86,200 28,000 6,800

2,81,000

Assets Plant and Machiney Land and Building Patents Stock Furniture Debtors Cash

Amt 45,000 84,000 3,400 47,800 10,600 80,000 10,200

2,81,000

On 1st April, 2013 they agreed to admit Suraj on the following terms and conditions:

1) Suraj to bring for 1/3rd share in future profit in cash Rs. 90,000 towards his capital. 2) The firm’s goodwill should be raised to Rs. 90,000 and it is to be written off after Suraj’s admission in new profit sharing ratio. 3) Plant and machinery was found undervalued by 10% and Land and Building was found overvalued by 20%. 4) Stock to be increased by Rs. 2,200 and furniture to be reduced to Rs. 10,000. 5) Out of creditors Rs. 1,200 is no more payable. 6) The Capital A/c to be adjusted in new profit sharing ratio by opening the current accounts. Prepare Revaluation A/c, Capital A/cs and Balance Sheet.

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19. Vaibhav and Vilas were partners sharing profits and losses in the ratio of 2:3 respectively. Their Balance Sheet as on 31st March, 2012 was as follows:


Liabilities Capital A/c’s - Vaibhav Vilas Creditors

Amt 50,000 50,000 70,000

1,70,000

Assets Land and Building Plant Furniture Stock Debtors Cash

Amt 25,000 30,000 2,000 50,000 58,000 5,000

1,70,000

They agreed to admit Vivek as a partner on 1st April 2012 on the following terms : 1) Vivek will have 1/4th share in future profits for which he shall bring Rs. 25,000 as his capital and Rs. 20,000 as his share of goodwill. 2) Land and Building are valued at Rs. 30,000 and while stock is valued at Rs. 55,000. 3) Plant is taken over by Vilas 10% discount. 4) Depreciate furniture by 10%. 5) Provision for bad and doubtful debts is to be maintained at 5% on debtors. 6) The capital account of all partners to be adjusted in their new profits sharing ratio and excess amount to be transferred to their loan account.

20. Manoj and Rahul are equal partners in a business. Their Balance Sheet as on 31st March, 2013 stood as under :

Balance Sheet as on 31 st March 2013 Liabilities Sundry Creditors General Reserve Capitals - Manoj Rahul

Amt 1,80,000 36,000 90,000 60,000

3,66,000

Assets Cash at Bank Debtors 62,000 (-) R.D.D 2,000 Bills Receivable Building Machinery

Amt 1,20,000

60,000 24,000 1,14,000 48,000

3,66,000

They decided to admit Amit on 1st April, 2013 on the following terms:

1) Machinery and Building be depreciated by 10%. 2) Reserve for doubtful debts to be increased to Rs. 5,000. 3) Bills Receivable are taken over by Manoj at a discount of 5%. 4) The amont of creditors paid at a discount of 10%. 5) The Capital Accounts of all the partners be adjusted in current account of patners. 6) Amit should bring Rs. 80,000 as capital for his 1/4th in future profits and goodwill account be opened in the books of the firm at Rs. 40,000. Prepare Revaluation A/c, Capital A/cs and Balance Sheet of the firm.

21. The Balance Sheet of Ramakant and Shyamkant who shared the profits in the ratio of 2:1 is as under Balance Sheet as on 31st March, 2012

Liabilities Capitals : Ramakant Shyamkant Creditors Rent Outstanding Reserve Fund Current A/c - Ramakant

Amt 1,34,000 1,20,000 51,000 10,000 7,200 2,800

3,25,000

Assets Leasehold Property Live Stock Loose Tools Stock Debtors 48,000 (-) R.D.D 2,000 Bank Current A/c - Shyamkant

Amt 20,000 6,600 90,200 84,800

46,000 75,400 2,000

3,25,000

On 1st April, 2012 Umakant was admitted as 1/4th partner on the following terms:

1) He brings Equipments of Rs. 80,000 as his capital. 2) Firm’s Goodwill is valued at Rs. 1,44,000 and Umakant agreed to bring his share in firm’s goodwill by cheque. 3) R.D.D should be maintained at 7.5% on debtors. 4) Increase live stock by Rs. 2,600 and write off loose tools by 20%. 5) Outstanding rent paid Rs. 9,040 in full settlement. Pass necessary journal entries to record the above scheme of admission.

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RETIREMENT OF PARTNER

1. The Balance Sheet of Paul, Suni and Minu is as follows:

Balance Sheet as on 31-03-2012

Liabilities Capital Accounts Paul Suni Minu Creditors Bills Payable

Amount 16,000 9,000 8,000 9,200 1,800

44,000

Assets Cash Debtors Stock Plant and Machinery

Amount 6,000 8,000 5,000 25,000

44,000

Minu retires from the business on the above date on the following terms :

1) Stock and Plant and Machinery to be depreciated by 6% abd 10% respectively. 2) Provision for doubtful debts to be created at 5% on debtors. 3) Provision of Rs. 800/- to be made in respect of outstanding rent. 4) Goodwill of the firm is raised to the extent of retiring partner’s share Rs. 9,000/- and remaining partners decided that goodwill should not appear in the books of accounts. 5) Their profits sharing ratio is 2:2:1. 6) The amount payable to the retiring partner be transferred to her loan account. Prepare: Profit & loss Adjustment A/c, Partners Capital A/c & Balance Sheet 2. The Balance Sheet of ‘Trivedi Traders’ is as follows. Partners share profits and losses as 5/10, 2/10, 3/10.


Liabilities Capitals Nayna Neena Dolly Creditors General Reserve

Amount

18,000 16,000 8,800 10,600 7,000

60,400

Assets Plant and Machinery Factory and Building Stock Debtors 8,400 (-) R.D.D 400 Cash

Amount 16,000 20,000 10,200

8,000 6,200

60,400

Neena retired from the business on 1st April, 2012 on the following terms :

1) The Assets are revalued as under i) Stock at Rs. 14,000 ii) Factory Building is appreciated by 10%. iii) Reserve for dountful debts is to be increased upto Rs. 500. iv) Plant and Machinery is to be depreciated by 10%. 2) The goodwill of the retiring partner is valued at Rs. 4,000/- and the remaining partners decided that goodwill be written back in

their new profits sharing ratio which will be 5:3. 3) Neena is to be paid Rs. 2,220 in cash on her retirement and the balance is to be transferred to her loan account. Prepare: Profit & loss Adjustment A/c, Partners Capital A/c & Balance Sheet 3. The following is the balance sheet of Prakash, Diwakar and Rajan who shared Profits and Losses in the ratio of 2/8, 3/8, 3/8.


Liabilities

Capitals Prakash Diwakar Rajan Creditors

Amount

80,000 75,000 60,000 42,000

2,57,000

Assets Plant and Machinery Stock Cash Debtors Less R.D.D Land and Building

Amount 84,000 56,000 1,000

16,000 1,00,000

2,57,000

Mr. Rajan retired on the above date from the firm on the following terms : 1) Plant and Machinery to be depreciated by 20%. 2) Stock to be revalued at Rs. 61,000. 3) Land and Building appreciated by 10%. 4) Provision for doubtful debts was no longer necessary. 5) Goodwill of the firm is to be raised at an average profits and losses of the five years. Which were as follows : Profit Rs. 80,000 Profit Rs. 70,000 Loss Rs. 20,000 Profit Rs. 30,000 Profit Rs. 40,000 6) Mr. Prakash and Diwakar will share the future profits and losses in the ratio of 3:1. 7) Goodwill should be wriiten off in new ratio. 8) Amount payable to Rajan should be transferred to his loan account. Prepare: Profit & loss Adjustment A/c, Partners Capital A/c & Balance Sheet

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4. Following is the Balance Sheet of Minaxi, Sunita, Ritu who were sharing profits and losses in proportion to their capital. Balance Sheet as on 31st March, 2012

Liabilities Capitals Minaxi Sunita Ritu Creditors

Amount

50,000 20,000 30,000 15,000

1,15,000

Assets Plant and Machinery Land and Building Stock Debtors 12,000 Less : R.D.D 1,000 Cash

Amount 20,000 55,000 12,000

11,000 17,000

1,15,000

Ritu retires from the business on 31st March, 2012 and the following adjustments were agreed to : 1) The stock is to be valued at 92% of its book value. 2) R.D.D is to be maintained at 10% on debtors. 3) The value of Land and Building be depreciated by 20%. 4) The goodwill of the firm be fixed at Rs. 12,000/- and Ritu’s share in the same be adjusted in the account of continuing partners in

gain ratio. 5) The entire capital of the new firm be fixed at Rs. 1,60,000, between Minaxi and Sunita in proportion to their new profit sharing

ratio which is fixed as 3:1 by making adjustments for difference in cash. Prepare: Profit & loss Adjustment A/c, Partners Capital A/c & Balance Sheet 5. Wadia N. Oza J and W. Jagdish were partners in a firm sharing profits and losses in the proportion of 5:3:2 respectively. Their Balance Sheet as on 31st March, 2012 is as under :


Liabilities Capitals : Wadia N. Oza J. W. Jagdish Creditors Bills Payable General Reserve

Amount

30,000 25,000 20,000 9,000 2,500 20,000

1,06,500

Assets Goodwill Land and Building Machinery Motor Van Stock Debtors Cash

Amount 21,000 20,000 10,000 25,000 12,000 14,000 4,500

1,06,500

On the above date Mr. W. Jagdish retired from the business on the following terms : 1) Assets and Liabilities were revalued as follows – Goodwill Rs. 11,000, Land and Building Rs .30,000, Machinery Rs. 8,000, Motor

Van Rs. 20,000, Creditors Rs. 7,000, Stock Rs. 10,000, Debtors Rs. 12,000. 2) Wadia N. and Oza J. contributed additional capital of Rs. 20,000 and Rs. 15,000 respectively. 3) Balance of W. Jagdish account has been fully paid in cash. Prepare: Profit & loss Adjustment A/c, Partners Capital A/c & Balance Sheet 6. Sanil, Nitish, Sapna were partners in a firm sharing profits and losses in the proportion of ½, 1/3, and 1/6 respectively. Their Balance Sheet as on 31st March, 2012 were as follows :


Liabilities Bills Payable Capitals : Sanil Nitish Sapna

Amount 30,000

80,000 50,000 30,000

1,90,000

Assets Machinery Furniture Sundry Assets Stock Debtors Bank

Amount 40,000 5,000 60,000 30,000 32,000 23,000

1,90,000

Sapna decided to retire on 1st April, 2012 on following terms :

1) Goodwill of the firm will be valued at Rs. 30,000. 2) Furniture was taken over by Sanil for Rs. 4,700. 3) Make a provision for unpaid expenses Rs. 1,700. 4) Out of the amount due to Sapna Rs. 7,500/- to be paid by cheque and the remaining amount to be transferred to her loan A/c. Prepare: Profit & loss Adjustment A/c, Partners Capital A/c & Balance Sheet

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7. Pai, Amba and Manoj are partners ina firm sharing profit and losses in the proportion to their capitals. Their Balance Sheet as on 31st March, 2012 is as follows :


Liabilities Capitals Pai Amba Manoj Creditors Outstanding Expenses Profit and Loss A/c

Amount

30,000 30,000 15,000 7,000 15,000 20,000

1,17,000

Assets Cash Stock Debtors Plant Building Motor Van Goodwill

Amount 3,000 12,000 20,000 13,000 20,000 31,000 18,000

1,17,000

On the following Date Pai retired and the following adjustments have been agreed upon :

1) Goodwill was revalued at Rs. 15,000. 2) Assets and Liabilities were revalued as under debtors Rs. 17,000, Stock at 90% of book value, Building Rs. 35,000, Plant Rs.

11,500, Motor Van Rs. 29,500, Outstanding expenses Rs. 18,000. 3) Amba and Manoj contributed additional capital of Rs. 20,000 and Rs. 10,000 respectively. 4) Balance due to Mr. Pai is transferred to his loan account after paying him Rs. 1,000/- Prepare: Profit & loss Adjustment A/c, Partners Capital A/c & Balance Sheet 8. Shailesh, Anil and Das were partners sharing profits and losses in the ratio at 3:3:2. Their Balance Sheet as on 31.3.2012 is as below :


Liabilities Capitals Shailesh Anil Das Bills Pyable Creditors Reserve Fund

Amount

11,000 15,000 8,000 1,900 9,000 4,000

48,900

Assets Building Machinery Furniture Debtors Stock Cash

Amount 10,000 10,700 10,000 5,000 6,600 6,600

48,900

On 1st April, 2012 Mr. Das retired from the firm on the following terms :

1) Shailesh and Anil’s share in reserve fund should be continued in new firm. 2) Goodwill of the firm is to be valued at Rs. 4,000 however only Das’s share in it is raised in the books and written off immediately. 3) Assets to be ravlued as under stock Rs. 6,300 machinery Rs. 10,000 furniture Rs. 10,200. 4) R.D.D to be maintained at 10% on debtors. 5) Rs. 100 to be written off from creditors. 6) The amount payable to Mr. Das is to be transferred to his loan account. Prepare: Profit & loss Adjustment A/c, Partners Capital A/c & Balance Sheet 9. Shedge, Mayekar and Raut were partners sharing profits and losses in the ratio of 4:3:3. Their Balance Sheet on 31st March, 2012 was as given below :


Liabilities Capitals Shedge Mayekar Raut Creditors Bank Overdraft

Amount

15,000 10,000 10,000 8,000 10,000

53,000

Assets Furniture Stock Debtors Bills Receivable Cash/ Bank Profit and Loss A/c (Loss)

Amount 4,200 13,000 10,000 18,000 2,000 5,800

53,000

Raut retired from the business on above date and it was agreed that the amount due to Raut to be paid immediately by availing overdraft facility.

1) His share of goodwill was raised at Rs. 3,500. 2) Revalue furniture at Rs. 4,000 and Stock Rs. 16,000. 3) Create R.D.D at 5% on debtors. 4) Make provision for outstanding printing bill Rs. 6,000. Prepare: Profit & loss Adjustment A/c, Partners Capital A/c & Balance Sheet assuming that goodwill is written off.

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10. Sathe, Deshpande and Madlani were partners sharing profits and losses in the ratio of 5:2:3. Their Balance Sheet was as follows :


Liabilities Capital Sathe Deshpande Madlani Creditors Bills Payable Reserve fund

Amount

70,000 80,000 50,000 25,000 12,000 25,000

2,62,000

Assets Plant and Machinery Building Motor Van Stock Debtors 36,000 Less : R.D.D 2,000 Cash

Amount 50,000 1,00,000 20,000 30,000

34,000 28,000

2,62,000

Deshpande retired on that date on the following terms :

1) Plant to be depreciated by 10% and Motor Van by @20%. 2) Stock to be appreciated by 10% and building by 20%. 3) R.D.D is no longer necessary. 4) Provision is to be made for Rs. 8,000 being compensation to workers. 5) The goodwill of the firm to be valued at Rs. 40,000 and Deshpande’s Share in it should be raised. 6) Both the remaming partners decided to write off the goodwill. 7) Amount Payable to Shri. Deshpande to be kept as his loan. Prepare: Profit & loss Adjustment A/c, Partners Capital A/c & Balance Sheet

DEATH OF PARTNER

1. Following is the financial position of Vishal, Sagar and Amar who were equal partners.


Liabilities Capital Vishal Sagar Amar Creditors Reserve Fund Profit and Loss

Amount

12,000 9,000 8,000 6,000 9,000 6,000

50,000

Assets Goodwill Machinery Stock Debtors Bank

Amount 6,000 16,000 11,000 9,000 8,000

50,000

On 1st October, 2012 Amar died and following adjustments were made :

1) Goodwill of the firm was appreciated by Rs. 3,600, however only Amar’s share in the appreciated value was raised in the books. 2) RDD was maintained at 5% on debtors. 3) Stock is valued at Rs. 10,000 and Machinery at Rs. 14,900. 4) Amar was to be given his share in the profits upto the date of death on the estimated profit based on previous year’s profit Rs.

12,000. 5) Amount due to Amar was transferred to his executors loan account. Prepare: Profit & loss Adjustment A/c, Partners Capital A/c & Balance Sheet 2. Rajendra, Sangita and sandhya were partners sharing profits and losses in the ratio of 2:2:1. Their Balance Sheet as on 31st March, 2012 was as follows :


Liabilities Rajendra Sangita Sandhya Creditors Bills Payable

Amount 40,000 30,000 20,000 18,000 22,000

1,30,000

Assets Machinery Stock Investment Debtors 18,800 (-) R.D.D 800 Cash

Amount 45,000 22,000 24,000

18,000 21,000

1,30,000

Sangita died on 30th June, 2012. The following adjustments were made in the books of the firm.

1) Stock was revalued at Rs. 26,000. 2) Machinery was depreciated by 10%. 3) R.D.D is no longer necessary. 4) Goodwill of the firm raised at Rs. 25,000. 5) 50% of the investment was taken over by Sandhya at book value and other 50% was sold at a profit of Rs. 3000/- 6) The decreased partner’s share in profit upto the date of death was to be calculated on the basis of average profits of last two years. Profit figures of last two years were Rs. 19,000 and Rs. 17,000. Prepare: Profit & loss Adjustment A/c, Partners Capital A/c & Balance Sheet

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3. Shrikant, Anita, Pardeshi were equal partners. Their Balance Sheet as on 31st March, 2012 was as under : Balance Sheet as on 31st March, 2012

Liabilities Capital Shrikant Anita Pardeshi Creditors Reserve Fund Profit and Loss A/c

Amount

15,000 12,000 8,000 14,000 9,000 6,000

64,000

Assets Machinery Stock Goodwill Debtors 12,000 (-) R.D.D 1,000 Bank

Amount 20,000 9,000 10,000

11,000 14,000

64,000

On 1st Oct, 2012, Pardeshi died and the following adjustments were made in the books. 1) Machinery revalued at Rs. 19,000 and Stock Rs. 8,500. 2) R.D.D was maintained at Rs. 4,000. 3) Goodwillof the firm was appreciated by Rs. 3,000, however only Pardeshi’s share in the appreciated value was raised in the

books. 4) Pardeshi was given his share of profit upto the date of death on the basis of estimated profit which was Rs. 3,600/- 5) Reserve fund of Shrikant and Anita kept in the business. 6) Amount due to Mr. Pardeshi was to be transferred to his executor’s loan account. Prepare: Profit & loss Adjustment A/c, Partners Capital A/c & Balance Sheet 4. Sudhakar, Madhukar and Raghunath were partners in a business sharing profits and losses in the ratio of 3:1:1 respectively. Their Balance Sheet as on 3st March, 2012 was as under :


Liabilities Sudhakar Madhukar Raghunath Creditors General Reserves

Amount 40,000 30,000 20,000 16,000 5,000

1,11,000

Assets Machinery Furniture Debtors Cash

Amount 40,000 30,000 30,000 11,000

1,11,000

Raghunath died on 31st Dec, 2012. 1) Machinery was to be revalued to Rs. 46,000 and Furniture at Rs. 29,000. 2) The drawings of Raghunath upto the date of death amounted to Rs. 12,000. 3) Interest on capital was to be allowed at 10% p.a. 4) Interest on drawings was to be charged at 6% p.a. 5) His share of goodwill to be calculated on the basis of two years purchase of last four years average profit. 6) His share of profit up the date of his death to be based on the profit of the previous year. 7) Previous Profit Figures = Rs. 70,000, Rs. 60,000, Rs. 30,000, Rs. 40,000. Prepare: 1. Raghunath’s Capital A/c showing amount payable to his legal heir.2. Give the working of goodwill & Profit. 5. Parag, Siddhesh, Nishu were partners sharing profits and losses in the ratio of 4:3:3. Their Balance Sheet was as follows :


Liabilities Capital Parag Siddhesh Nishu Creditors General Reserve Profit and Loss Account

Amount

40,000 40,000 30,000 22,000 12,000 16,000

1,60,000

Assets Sundry Assets Stock Debtors 40,000 Less : R.D.D 2,000 Cash

Amount 80,000 30,000

38,000 12,000

1,60,000

Nishu died on 1st July, 2012 and the following adjustments were agreed. 1) Sundry assets revalued at Rs. 90,000. 2) R.D.D was maintained at 10% on debtors. 3) A provision for outstanding expenses was to be made for Rs. 1,000. 4) His share of goodwill to be calculated on 3 years purchases of average profit of last 4 years profit of last 4 years were – Rs. 20,000, Rs. 18,000, Rs. 12,000 & 22000. 5) The deceased partners to be given his share of profit to the date of his death on the basis of average profits of last two years. 6) His drawings till the death amounted to Rs. 27,825. Prepare: 1. Nishu’s Capital A/c showing amount payable to his legal heir.2. Give the working of goodwill & Profit.

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6. Vilas, Mangal, Guru were partners in a business sharing profits and losses in the ratio of 2:1:1 respectively. Their Balance Sheet as on 31st March, 2012 was as follows :


Liabilities Capital Vilas Mangal Guru Creditors General Reserve

Amount

6,000 7,000 3,400 2,000 1,600

20,000

Assets Land and Building Debtors Stock Cash

Amount 6,000 5,000 3,000 6,000

20,000

Guru died on 1st July, 2012

1) Land and Building was to be revalued to Rs. 7,000 and RDD was to be created of Rs. 200. 2) The drawings of Guru upto the date of his death amounted to Rs. 1,000. 3) Charge interest on drawings Rs. 100/- 4) His share of goodwill should be calculated at ‘Three’ years purchase of the profits for the last four years which were Rs. 15,000, Rs. 13,000, Rs. 7,000, Rs. 5,000. 5) The deceased partners share of profit upto the date of his death to be calculated on the basis of average profit of last two years. Prepare: Profit & loss Adjustment A/c, Partners Capital A/c & Balance Sheet 7. Sheetal, Anjali, Rajendra were sharing profits and losses as 7:5:4. Their Balance Sheet as om 31st March, 2011.


Liabilities Capital Sheetal Anjali Rajendra Bills Payable Creditors Loan General Reserve

Amount

23,000 15,000 12,000 4,000 8,000 10,000 16,000

88,000

Assets Furniture Machinery Building Cash

Amount 17,000 18,000 16,000 37,000

88,000

Rajendra Died on 30thJune, 2012 and the following adjustments were agreed as per deed. 1) Furniture, Machinery and Building are to be revalued at Rs. 16,700, Rs. 16,200, Rs. 30,100. 2) Rajendra’s share is goodwill to be valued from firm’s goodwill which was valued at two times the average profit of last three

years. Profits of last three years: Rs. 30,000, Rs. 25,000, Rs. 20,000/- 3) His profit upto the date of death is to be calculated on the basis of last year profit. 4) Rajendra was entitled to get a salary of Rs. 800/- month. 5) Interest on capital at 10% be allowed. 6) Rajendra’s drawing upto the date of death were Rs. 600 p.m. Prepare: Raghunath’s Capital A/c showing amount payable to his legal heir.2. Give the working of goodwill & Profit. 8. The Balance Sheet of Mohan, Subhash, Babi as on 31st December, 2011 was as under. They were sharing profits and losses in the ratio of 2:1:1.

Balance Sheet as on 31st December, 2011

Liabilities Capital Mohan Subhash Babi Creditors Reserve

Amount

25,000 15,000 15,000 30,000 16,000

1,01,000

Assets Investments Building Debtors Stock Cash

Amount 20,000 33,000 12,000 28,000 8,000

1,01,000

Babi died on 1st July, 2012 and Partnership deed provided that in the event of death of the partner his executor will be entitled to be paid out. 1) Capital to the credit at the date of last balance sheet. 2) Proportion of reserves. 3) Proportion of goodwill to be calculated twice the average profits of last three years. 4) His proportion of profits to the date of death based on the average profits of the last three year plus 20%. 5) The net profit for last 3 years, Ra. 18,000, Rs. 18,000, Rs. 16,500. 6) Babi had withdrawn Rs. 6,000/- to the date of her death. 7) The investment were sold at per and the amount was paid off to Babi’s executor and the balance was transferred to loan A/c. Prepare: Babi’s Capital only A/c.

26


9. Minaxi, Ramesh and Poonam were partners sharing profits and losses in the proportion to their capitals. Their Balance Sheet of the firm on 31st March, 2012 was as under :


Liabilities Capital Minaxi Ramesh Poonam Creditors Reserve

Amount

30,000 20,000 10,000 28,000 18,000

1,06,000

Assets Land and Building Investments Debtors 16,000 Less : R.D.D 2,000 Stock Cash

Amount 40,000 20,000

14,000 18,000 14,000

1,06,000

Poonam died on 1st July, 2012 and the following adjustments were made : 1) Assets revalued as under – Land and Building Rs. 44,000, Investment Rs. 18,000, Stock Rs. 17,000. 2) All debtors were good. 3) Goodwill of the firm valued at two times the average profits of last 4 years. No goodwill account to be shown in the books of the

firm. 4) Poonam’s share of profit upto her death to be calculated on the basis of average profits of last two year. 5) Profits were Rs. 6,000, Rs. 12,000, Rs. 7,000, Rs. 11,000. Prepare: Profit & loss Adjustment A/c, Partners Capital A/c & Balance Sheet. 10. Vishnu, Prabhakar and Krishna were partners in a business sharing profits and losses in the ratio of 3:1:1. Their Balance Sheet as on 31st March, 2012 was as follows :


Liabilities Capital Vishnu Prabhakar Krishna Creditors Reserve Fund

Amount

40,000 30,000 25,000 5,000 10,000

1,10,000

Assets Plant and Machinery Stock Debtors Cash

Amount 35,000 25,000 20,000 30,000

1,10,000

Krishna died on 31st October, 2012 and the partnership deed provided that :

1) The deceased partner to be given his share of profit to the date of death on the basis of the profits of the previous year. 2) His share of goodwill will be calculated on two years purchase of average profit of the last 4 years. The net profit for last 4 years

were – Rs. 70,000, Rs. 55,000, Rs. 45,000, Rs. 30,000. 3) Plant and Machinery to be valued at Rs. 40,000. Reserve for doubtful debts of Rs. 2,000 to be created. 4) The drawings of Krishnan upto the death amounted to Rs. 20,000. 5) Interest on capital at 10% p.a. is to be allowed and 6% p.a. to be charged on drawings. Both interest should be calculated for 6

month. Prepare: Profit & loss Adjustment A/c & Krishna’s Capital A/c.

DISSOLUTION OF PARTNERSHIP FIRM

1. Karan and Kamal are partners in a firm. They share profits and losses in the proportion of 3:2. They decided to dissolve the partnership on 31st March, 2011, when their Balance Sheet was as under :


Liabilities Sundry Creditors Reserve Fund Capitals Karan Kamal

Amount 22,900 5,000

40,000 30,000

97,700

Assets Stock Plant Lease Furniture Sundry Debtors Cash at Bank

Amount 24,300 24,000 10,000 5,000 29,600 5,000

97,900

The lease was sold for Rs. 10,720, Furniture for Rs. 6,000 and Stock for Rs. 15,300. The debtors realized only Rs. 24,500. Whereas plant realized Rs. 24,200. The creditors were paid Rs. 22,000 in full settlement Expenses of Realisation amounted to Rs. 1,000. Pass necessary Journal Entries in the books of the firm.

27


2. The following is the Balance Sheet as on 31st March, 2010 of M/s. Paresh and Mahesh. Balance Sheet as on 31st March, 2010

Liabilities Capital Account Paresh Mahesh Reserve Fund Loan from Paresh Bills Payable Creditors

Amount

1,50,000 1,50,000 30,000 3,000 6,000 30,000

3,69,000

Assets Cash at Bank Stock Furniture Investments Machinery Buildings Debtors 24,000 Less : R.D.D 3,000

Amount 18,000 75,000 90,000 30,000 90,000 45,000

21,000

3,69,000

The firm was dissolved as on 31st March, 2010 and the assets realized as under :

1) Paresh Took – Over Investments at Rs. 27,600. 2) Mahesh took – over Furniture at Rs. 84,000. 3) The Assets were realized as follows : Stock Rs. 73,000/-, Debtors Rs. 22,500/-, Machinery Rs. 84,000/-, Building Rs. 42,000/-. 4) The Creditors were paid off at a discount of Rs. 900/- and other liabilities were paid in full. 5) Dissolution expenses were Rs. 4,200. 6) Paresh and Mahesh were sharing profits and losses in the ratio of 3:2. Pass necessary Journal Entries in the books of the firm & Prepare: 1) Realisation A/c 2) Capital A/c 3) Bank A/c 3. Jay, Ajay and Vijay were partners sharing P&L in the proportion of 2:2:1. Following is the Balance Sheet as on 31st March, 2011.


Liabilities Capital Jay Ajay Vijay General Reserve Creditors Jay’s Loan Bills Payable

Amount

60,000 20,000 20,000 6,000

40,000 8,000

14,000

1,68,000

Assets Machinery Stock Debtors 55,000 Less R.D.D 3,000 Investments Profit and Loss A/c Bank

Amount 50,000 20,000

52,000 24,000 18,000 4,000

1,68,000

On the above date the partners decided to dissolve the firm : 1) Assets were realized as Machinery Rs. 45,000,/-, Stock Rs. 18,000/-, Investments Rs. 21,000/-, Debtors Rs. 45,000/-. 2) Dissolution expenses were Rs. 3,000. 3) Goodwill of the firm realized Rs. 24,000/- Pass Journal Entries in the books of the firm & Prepare: 1) Realisation A/c 2) Capital A/c 3) Bank A/c 4) 4. Kishor and Suresh were partners sharing profits and losses in the ratio of 3:2. There Balance Sheet as on 31st March, 2010 was as follows :

Balance Sheet as on 31st March, 2010 Liabilities Creditors Bills Payable Kishor’s Capital A/c Suresh’s Capital A/c Kishor’s Current A/c Suresh’s Current A/c

Amount 90,000 25,000 2,00,000 1,50,000 18,000 12,000

4,95,000

Assets Bank Stock Buildings Plant Debtors

Amount 55,000 55,000 2,50,000 1,00,000 35,000

4,95,000

The firm was dissolved on the above date and the assets were realized as under : 1) Stock Rs. 50,000/-, Debtors Rs. 25,000/-, Plant Rs. 80,000/- and Building Rs. 2,00,000/- 2) Kishor agreed to pay off bills payable. 3) Creditors were paid off Rs. 80,000/- 4) Dissolution expenses were Rs. 5,000/- Pass necessary Journal Entries in the books of the firm & Prepare: 1) Realisation A/c 2) Current A/c 4) Capital A/c 3) Bank A/c

28


5. Umesh and Prakash were partners sharing profits and losses in the proportion of 3/5 and 2/5 respectively. They dissolve their partnership firm on 31st March, 2011, when their financial position was as under :


Liabilities Sundry Creditors Umesh’s Wife’s Loan Profit and Loss A/c Capital Accounts Umesh Prakash

Amount 7,500 6,000 9,000

69,000 45,000

1,36,500

Assets Cash in hand Cash at Bank Debtors 33,750 Less : R.D.D 3,750 Stock Machinery Furniture

Amount 500 1,000

30,000 67,500 22,500 15,000

1,36,500

The assets realized as under : 1) Goodwill Rs. 7,500, Stock Rs. 60,000/- and Debtors Rs. 27,000/- 2) Machinery was taken over by Prakash at Rs. 20,000 and Furniture by Umesh at book value. 3) Umesh agreed to discharge his wife’s loan. 4) The creditors were paid at a rebate of Rs. 1,500. 5) The expenses of dissolution amounted to Rs. 3,000. Pass necessary Journal Entries in the books of the firm. 6. M/s. Amir, Babar and Chinatmani partners carrying on business. They share profits and losses in the proportion of 5:3:2 respectively. Their Balance Sheet as on 31st March, 2011 was as under :


Liabilities Sundry Creditors Babar Loan General Reserve Capital Amir Babar Chinatmani

Amount 20,500 4,500 20,000

18,000 8,000 3,500

74,500

Assets Plant and Machinery Investments Stock Sundry Debtors 18000 Less Provision 1000 Goodwill Cash at Bank

Amount 17,500 2,800 28,000

17,000 5,300 3,900

74,500

On the above date the firm was dissolved and the assets were realized as under :

Investments Rs. 3,000, Stock Rs. 24,000, Debtors Rs. 12,000. The plant and Machinery was taken over by Mr. Amir at book value. Sundry Creditors and Babar’s loan were fully paid up. A contingent liability of Rs. 3,500 was maturedat the time of realization. Nothing was realized for goodwill. Expenses of realization incurred Rs. 400. Pass necessary Journal Entries in the books of the firm. 7. M/s Xavier, Yasin, and Zuber were partners sharing profits and losses in the proportion of 3:2:1. They decided to dissolve the

partnership firm on 31st March, 2008 on which date their Balance Sheet was as under :


Liabilities Capital Account Xavir Yasin Zuber Bank Loan Leasehold Redemption Fund Life Policy Fund Sundry Creditors

Amount

30,000 10,000 10,000 11,500 6,000 12,000 16,200

95,700

Assets Goodwill Leasehold Building Machinery Stock Investments Joint Life Policy Sundry Debtors 5,800 Less : R.D.D 500 Cash at Bank

Amount 20,000 12,500 30,520 7,550 6,330

12,000

5,300 1,500

95,700

The assets realized as under : The life policy is surrendered for Rs. 10,000. The Investment was taken over by Mr. Yasin for Rs. 8,000. Mr. Xavier A agreed to discharge the bank loan. The remaining assets were sold for Rs. 86,700. The expenses of realization amounted to Rs. 900. Pass necessary Journal Entries in the books of the firm.

29


8. Sadhana , Seema and Kalpana were carrying on business. The profit sharing ratio was 3 : 1 : 2 respectively. Their Balance Sheet as on 31st March, 2012 was as under.

Balance Sheet as on 31st Mrarch, 2012

Liabilities Capital Accounts Sadhana Seema Reserve fund Sadhnana’s Loan Sundry Creditors Bills payable

Amount

24,000 16,000 3,000 9,200

41,900 5,900

1,00,000

Assets Capital Accounts Kalpana Land & Building Motor Car Machinery Stock Investments Bills receivable Cash

Amount

8,000 29,700 16,200 22,500 3,900 10,000 6,300 3,400

1,00,000

Kalpana was declared insolvent by the court and was able to bring Rs.1,000 only on this date the firm was dissolved and the results of realisation were as under:

i) Sadhana tool over bills receivable at a discount of : Rs.3,800 and agreed to pay bills payable at Rs.4,900 in full. ii) The assets realised as under: Land & Building Rs.18,900, Motor Car Rs. 3,800 less, Machinery Rs.1,300 more,

Investments at 18% less than book value, stock was sold for Rs.1,700. iii) Sundry Creditors were paid off less Rs.1,900 as discount iv) Sadhana’s was dicharged in full together with interest payable of Rs.800 v) Realisation expenses were Rs.1,500

Pass necessary Journal Entries in the books of the firm distributing capital deficiency of insolvent partner,among other solvent partners in profit sharing ratio.

9) Sun Moon and Star were equal partners, Their financial position as on 31st March, 2011 was as under.


Liabilities Capital Accounts Sun Moon Star Current Accounts Sun Moon Sundry Creditors Bills payable

Amount 20,000

16,000 1,000

2,000 1,000

Amount

37,000

3,000 8,000 2,000

50,000

Assets Current Account Star Premises Machinery Debtors Less: R.D.D Furniture Profit and Loss A/C Cash

Amount

11,000 2,00

Amount

13,000 9,800 8,500

10,800

9,00 6,000 1,000

50,000

On the above date they decided to dissolve the partnership firm ant the result of realisation were as under .

i) Sun to take over premises at an agreed value of Rs.5,000, Machinery realised at 80% of book value and debtors at Rs.8,300. Furniture was given away free of charge to the office boy.

ii) Sundry creditors were paid Rs.4,100 in full satisfaction of their claims, whereas Bill payable were discharged by sun Book valve.

iii) Realization expenses amounted to Rs.1,100 which met by sun, personally. iv) Star becomes insolvent and Rs.7,000 could be recovered from his private estate.

Give necessary ledger accounts to close the books of the firm.

10) Kishor, Abhay and Vinod were partners sharing Profits and Losses in the ratio of 2/5, 2/5 and 1/5 respectively. They decided to

dissolve the firm on 30th April, 2012 when their position was as under.

Balance Sheet as on 30th April, 2012

Liabilities Capital Accounts Kishor Abhay Vinod Creditors Bills payable

Amount

9,800 9,100 6,100

50,000 20,000

95,000

Assets Building Machinery Stock Debtors Bank Profit & Loss A/C

Amount 18,900 26,700 12,500 16,900 11,000 9,000

95,000

The firm was dissolved on the above date and the following results of realization were as under.

i) The assets realised as under- Building Rs.10,200, Machinery Rs.17,500, Stock Rs.4,200, Debtors Rs.9,700. ii) Realisation expenses amounted to Rs.1,700. iii) All partners were declared insolvent. The recovery from their private estates were as follows-

Kishor Rs.2,000, Abhay Rs.3,000 and Vinod- Nil Prepare necessary ledger accounts to close the books of the firm.

30


11) Mohan, Anand and Krishna are equal partners, whose Balance Sheet on 30th April, 2012 was as under.

Balance Sheet as on 30th April, 2012

Liabilities Sundry creditors Mohan’s Loan Capital Account Mohan Krishna

Amount 25,000 5,000

4,000 2,500

36,500

Assets Cash in hand Stock Debtors Plant and Machinery Furniture & Fittings Land & Building Anand’s Capital A/C

Amount 250

4,000 5,000

10,000 4,000

10,000 3,250

36,500

Due to weak financial position of the partners, the firm is dissolved. Mohan and Krishna are not able to contribute anything and a sum of Rs.1,000 received from Anand. All of them are declared insolvent. The assets realized: Stock Rs.2,500, Plant & Machinery Rs.5,000, Furniture 7 Fittings Rs.1,000, Land & Building Rs.4,000 and Debtors Rs.2,750 only. Realisation expenses amounted Rs.250. Prepare necessary ledger accounts to close the books of the firm.

12. Sushil and Sumit were in partnership sharing profits and losses in the proportion of 3/5 and 2/5 respectively. On 31st March, 2005 they decide to dissolve the firm when their Balance Sheet was as under:


Liabilities Sushil’s Capital Sumit’s Capital General Reserve Sumit’s loan Sundry Creditors

Amount 20,000 18,000 5,000 2,000 10,000 55,000

Assets Plant and Machinery Stock Sundry Debtors Bank

Amount 15,000 15,000 22,000 3,000

55,000

The assets realised as follows: Stock Rs.14,000, Plant and machinery Rs.12,000 and Debtors Rs.20,000. The Sundry creditors were paid Rs.9,000 in full settlement.

Prepare: Realisation Account,Partners Capital Account and Bank Account.

13. Ganesh and Chandan were partners sharing profits and losses in the proportion of 3:2. They dissolve the partnership firm

on 31st March, 2011 when their position was as follows:


Liabilities Sundry Creditors Bank overdraft Reserve Fund Capital Accounts: Ganesh Chandan

Amount 25,000 20,000 30,000

2,30,000 1,50,000 4,55,000

Assets Debtors 1,12,500 Less: R.D.D 12,500 Stock Furniture Motor car Cash in hand

Amount

1,00,000 2,25,000 50,000 75,000 5,000

4,55,000

The Assets realised as follows: Debtors Rs.90,000, Stock Rs.2,00,000. And Goodwill Rs.25,000, Motor car was taken over by Ganesh for Rs.70,000 and Furniture by Chandan for Rs.60,000.

The creditors were paid Rs.22,500 in full settlement, the expenses of realization amounted Rs.10,000. Pass necessary journal entries in the books of the firm.

14. Anil and Sunil were partners sharing profits and losses in the ratio 3:2. Their Balance Sheet as on 31st March 2009.


Liabilities Capital Account Anil Sunil Current Account Anil Sunil Creditors Bills payable

Amount

50,000 30,000

15,000 10,000 87,000 13,000

2,05,000

Assets Bank Stock Debtors Plant Building

Amount 30,000 25,000 70,000 45,000 35,000

2,05,000

The firm was dissolved on the above date and the assets realised as under

1) Stock Rs.20,000, Debtors Rs.60,000, Plant Rs.40,000 and Building Rs.30,000.

2) Anil agreed to pay off the bill payable.

3) Creditors were paid off in full.

4) Dissolution expenses were Rs.7,000

Prepare: i) Realisation Account ii) Bank AccountIiii) Current Account and Capital Account of the Partners.

31


15. X, Y and Z were carrying on business. They share profits and losses in the ratio of 5 : 2 : 3 respectively. Their Balance Sheet as

on 31st March 2010 was as under:


Liabilities Sundry Creditors Y’s Loan Reserve Fund Capital Account X Y Z

Amount 21,000 5,000

20,000

20,000 10,000 4,000

80,000

Assets Plant and Machinery Investments Stock Debtors 18,000 Less : R:D:D 1,000 Cash in hand Cash at bank

Amount 20,000 8,000

30,000

17,000 2,000 3,000

80,000

On the above date the firm was dissolved and the assets realised as under:

1) Investment Rs.5,000 , Stock Rs.24,000 and Debtors Rs.15,000.

2) The Plant and Machinery was taken over by Mr. ‘X’ at book value.

3) Sundry creditors and Mr. ‘Y’ loan were paid in full.

4) Realisation expense incurred Rs.1,000

Prepare Realisation account, Partners’ capital account & Bank account.

16. A, B and C were partners sharing profits and losses in the ratio of 3 : 2 : 1. On 31stMarch ,2010. Their Balance Sheet was as

follows


Liabilities Sundry Creditors Bills payable A’s Loan A/C Capital Account A B C Reserve Fund

Amount 15,400 3,600

10,000

20,000 16,000 8,000

12,000

85,000

Assets Cash at Bank Stock Debtors 15,000 Less : Provision 1,000 Joint Life Policy Plant and Machinery

Amount 3,500

19,800

14,000 4,000

43,700

85,000

The firm was dissolved on 31st March, 2010 and the assets realised as follow:

1) Join Life Policy was taken over by Mr. A at Rs.5,000.

2) Stock realised Rs.18,000 , Debtors realised Rs.14,500 , Plant and Machinery was sold for Rs.36,000.

3) Liabilities were paid in full. In addition one bill for Rs.700 under discount was dishonoured and had to be taken up by the

firm.

4) There were no realisation expenses .

Give Journal enteries and necessary Ledger accounts to close the books of the firm.

17. Pannalal, Babulal and Hiralal were partners sharing profits and losses in the proportion of 2 : 2 :1 , following is their Balance

Sheet as on 31st March 2008.


Liabilities Capital Accounts Pannalal Babulal Hiralal General Reserve Creditors Pannalal’s Loan Bills payable

Amount

30000 10000 10000 3000 20000 4000 7000 84000

Assets Machinery Stock Debtors 27,500 Less : R.D.D 1,500 Investments Profit and Loss A/C Bank

Amount 25,000 10,000

26,000 12,000 9,000 2,000

84000

On the above date the partners decided to dissolve the firm:

32


1) Assets were realised: Machinery Rs.22,500 , Stock Rs.9,000 , Investments Rs.10,500 , Debtors Rs. 22,500.

2) Dissolution expenses were Rs.1,500.

3) Goodwill of the firm realised Rs.12,000.

Pass the necessary Journal enteries.

18. Mahesh, Suresh and Jayesh were partners of the firm. They decided to dissolve the firm on 31st March, 2012. Their Balance

Sheet as on that date was as under:


Liabilities Creditors Loan Capitals Mahesh Suresh Jayesh

Amount 18,000 4,500

82,500 30,000 21,000

1,56,000

Assets Cash at Bank Sundry Assets Debtors 72,600 Less: R.D.D 3,600 Stock Furniture

Amount 9,600 51,000

69,000 23,400 3,000

1,56,000

The firm was dissolved as follows:

1) Mahesh will accept furniture for Rs.2,000 and agreed to accept the debtor of book valve of Rs.60,000 at on agreed valve of

Rs.51,000.

2) Suresh will accept stock at an agreed valve Rs.20,000, and Sundry Assets of Book value Rs.24,000 at Rs.23,500.

3) Jayesh will accept remaining Sundry Assets For Rs.25,000 He will further accept the liability of loan along with due interest

at 12% p.a. Interest for three months on this loan was outstanding and was not recorded in the books.

4) Expenses of dissolution were Rs.1,000 and outstanding expenses of Rs.1,200 were to be paid from the firm.

5) The remaining debtors were realised Rs.7,000.

Prepare Realisation account, Partners’ capital account & Bank account.

19. Gautam, Virat and Ashwin were partners sharing profits and losses equally. Their Balance sheet as on 31st March, 2011 was as

follows:


Liabilities Capital Accounts Gautam Virat Reserve Fund Creditors Bank Loan

Amount

75,000 45,000 27,000 48,500 11,500

2,07,000

Assets Building Furniture Stock Debtors Cash Ashwin’s Capital

Amount 73,900 44,100 25,400 33,600 15,000 15,000

2,07,000

The firm was dissolved due to insolvency of ashwin and the following was result.

i) The realization of assets were as follows:

a) The stock was completely damaged and could realize worth Rs.16,500 only.

b) Building was sold for Rs.49,800

c) Furniture was reakised by the firm at Rs.23,100 less than the book valve

d) A customer who owes Rs.14,400 became insolvent and nothing could be recovered from his private estate

ii) Creditors were paid for Rs.36,900 in Full settlement and Bank Loan was discharged fully

iii) The expenses of realization Rs.4,100

iv) Ashwin became insolvent and the firm could recover only Rs.4,000 from his private estate.

Prepare Realisation account, Partners’ capital account & Cash account.

33


20. Rahul, Rohit and Ramesh were partners in a firm sharing profit and losses in the ratio 2 : 2 : 1 respectively. The Balance sheet

as on 31st March, 2012 was as follows:


Liabilities Sundry Creditors Bills payable General Reserve Rahual ‘s Loan A/C Capital Accounts Rahul Rohit

Amount 20,000 5,000 6,000

16,000

25,000 10,000 82,000

Assets Cash at Bank Debtors 16,000 Less : R.D.D 1,000 Stock Plant & Machinery Furniture Ramesh’s Capital A/C

Amount 8,000

15,000 20,000 30,000 6,000 3,000 82,000

The firm was dissolved on the above date.

The assets realized as follows:

1) Debtors Rs.9,000, Plant & Machinery Rs.26,000, Stock Rs.14,000 and furniture Rs.3,000

2) The creditors were paid Rs.18,000 in full settlement and the bills payable were paid in full.

3) The realization expenses amounted to Rs.3,000

4) Ramesh became insolvent and was able to bring in only Rs.1,800 from his private estate Prepare: 1) Realisation account, 2) Partners’ Capital account, 3) Bank account.

21. Shiv, Sadashiv and Sadanand are partners in a firm sharing profit and losses equally whose Balance Sheet as on 31st March

2011 stood as follows:


Liabilities Capital Accounts Shiv Sadashiv Parvati’s Loan Sundry Creditors

Amount

6,000 4,000

10,000 30,000 50,000

Assets Sadanand Capits A/C Buildings Machinery Debtors Bank

Amount 2,000

18,300 12,700 9,100 7,900

50,000

Shiv, Sadashiv and Sadanand were declared bankrupt and hence the firm was dissolved as on that date:

i) The sundry Assets realised as follows:

Building Rs.10,900 , Machinery Rs.8,200 , Debtors Rs.6,800

ii) Realisation expenses amounted Rs.1,300

iii) Sadanand was unable to contribute anything

Whereas Rs.1,000 and Rs.900 were recovered from the realization of private estate of Shiv and Sadanand respectively.

You are required to close the books of the firm.

22. Ganga, Yamuna and Godavari are in partnership sharing profits and losses equally. Their Balance sheet as on 31st March,

2011 was as follows.


Liabilities Capital Account Ganga Yamuna Godavari Ganga’s Current A/C Sundry Creditors Bank Loan

Amount

25,000 10,000 5,000 3,000 4,000 3,000

50,000

Assets Currents Accounts Yamuna Godavari Premises Machinery Debtors Cash

Amount

2,000 4,000

17,200 10,800 9,600 6,400

50,000

Godavari was declared insolvent and hence the firm was dissolved as on that date. Premises was sold at Rs.14,800, Machinery realised Rs.6,400. Bad debts and discount allowed to debtors amounted to Rs.1,600. Sundry creditors agreed to receive 80 paise in a rupee in full satisfaction of their claim. Bank Loan was settled at 60% of book value. During the course of dissolution a liability under an action fot damages was settled for Rs.1,400 againt Rs.2,100 provided in the books of the firm. The expenses of realization amounted to Rs.900. Godavari contributed Rs.1,900 from her private property. Prepare necessary ledger accounts.

34


ACCOUNTS OF NOT FOR PROFIT CONCERNS

1. Lalit Kala Kendra Mumbai gives u the following information, for the year ended on 31.03.2013. You required to prepare:

i) Income and Expenditure Account for the year ending on 31.03.2013

ii) Balance Sheet as on 31.03.2013

Dr Receipts an Payments Account for the year ending 31.03.2013 Cr

Receipts To Balance b/d: Cash in Hand Cash at Bank To Locker Rent To Entrance Fees To Sale of old Newspapers To Receipts from Drama To Legacies To Miscellaneous Receipts

Amount

1,300 9,500 500 1,900 150 7,850

11,000 800

33,000

Payments By Stationery By Furniture Purchased By Investments By Expenses Of Drama By Postage and Telegram By Magazines and Newspapers By Salaries By Balance c/d Cash in Hand Cash at Bank

Amount 500 5,000

10,000 3,350 250 400 2,200

300 11,000 33,000

1. Capital Fund on 1.04.2012 was Rs.10,800

2. Legacies are to be capitalized

3. Outstanding salary Rs.300

4. 50% of entrance fees are to be capitalized

2. Vishwa Shanti Mandal was established on 01.04.2011 and the following is the accounting information for their first year 2011 to

2012.

Dr Receipts and Payments Account for the year ending 31.03.2012 Cr

Receipts To Subscription To Entrance Fees To Donations

Amount Amount 95,000 10,000 75,000

1,80,000

Payments By Furniture By Books By Printing and Stationery By Newspapers By Office Rent By Salary By Fixed Deposit By Balance c/d Cash in hand Cash at Bank

Amount

18,000 20,000

Amount 20,000 15,000 5,000 2,500 7,300 8,400

1,00,000

21,800

1,80,000

1) Depreciation Furniture by Rs.1,000.

2) Entire amount of entrance fees and donations are to be capitalized.

3) There are Rs.1,000 Members, each paying Rs.100 as annual subscription.

4) Outstanding Salaries Rs.600 and office rent Rs.700.

You required to prepare:

Income and Expenditure Account for the year ending on 31.03.2012

Balance Sheet as on 31.03.2012

3. From the following Balance Sheet and receipts and payment account of Juhu sport club, Juhu prepare Income and Expenditure

Account for the year ending 31.03.2013 and the Balance Sheet as on that date.


Liabilities Capital fund Bank overdraft rize Fund

Amount 1,54,950

5,750 60,000

2,20,700

Assets Play ground Sports equipments Investment Stock of sports Material Outstanding subscription Cash in hand

Amount 1,00,000 65,000 40,000 9,000 5,000 1,700

2,20,700

35


Dr Receipts and payments Accounts for the year ending 31.03.2013 Cr

Receipts To Balance b/d To Subscriptions 2011-2012 2012-2013 2013-2014 To Donation for Prie Fund To Entrance Fees To Sundry Income

Amount

3,750 85,000 1,000

Amount 1,700

89,750 30,000 4,500 2,000

1,27,950

Payments Bank Overdraft (Repaid) By Investment By Ground upkeep By Printing and stationery By Sports material Purchased By electricity Charges By Sports equipments By Balance c/d Cash in Hand Cash at Bank

Amount Amount 5,750 60,000 5,500 2,250 15,250 1,850 25,000

1,850 10,500

1,27,950

1) On 31.03.2013, Sports Material in hand was of Rs.9,500.

2) Subscription outstanding for current year Rs.5,000.

3) Entire amount of entrance fees is to be capitalized.

4. Given below the Balance Sheet as on 01.02.2010 and Receipts and Payments Account for the year ending 31.03.2011 of Samat

Sports Club, Solapur, Prepare Income and Expenditure Account for year ending on 31.03.2011 and the Balance Sheet as on that

date


Liabilities Capital Fund Building Fund Subscription Received In advance for the year 2010-2011

Amount 4,62,500 2,50,000

4,500

7,17,000

Assets Play ground Furniture Stock of Sports Material Building Fund Investment Cash in hand Cash at Bank Outstanding subscriptions

Amount 4,00,000 18,000 22,000 2,50,000 1,600 8,400 17,000

7,17,000


Receipts To Balance b/d Cash in hand Cash at Bank To Subscription To Admission Fees To Donations To Sundry Receipts To Interest on Investment of Building Fund

Amount

1,600 8,400

Amount

10,000 1,00,900

6,500 28,000 1,350

9,000

1,55,750

Payments By Sports Material Purchased By Salaries and Wages By Office rent By Telephone Charges By Printing and Stationery By Balance c/d Cash in hand Cash at Bank

Amount

6,000 11,050

Amount

26,000 43,500 63,000 3,900 2,300

17,050

1,55,750

1) Stock of sports material in hand on 31.03.2011 was Rs.24,000

2) Admission Fees and Donations are to be capitalized

3) Subscription received during the year included Rs.17,000 for previous year and Rs.5,000 for next year. Current year’s

subscription Rs.14,500 is outstanding.

5. The Green Valley School, Lonawala has presented the following information and with this you are required to prepare:

i. Income and Expenditure A/C for the year ending 31.03.2010

ii. Balance Sheet as on 31.03.2010


Liabilities Capital Fund

Amount 6,54,000

6,54,000

Assets Cash in hand Cash in bank Building Furniture Books Fixed Deposit

Amount 4,500 9,500

5,00,000 60,000 30,000 50,000

6,54,000

36



Receipts To Balance b/d Cash in hand Cash at bank To Tuition Fees To Fine collection To Admission fees To Donations (to capitalized) To interest received To Government Grant (Revenue)

Amount Amount

4,500 9,500

85,000 2,600

10,000 50,000

2,500

1,00,000

2,64,100

Payments By Salary paid By Books By Stationery and Printing By Office Rent By Repairs and maintenance By Sports Expenses By Annual Gathering Expenses By Furniture By Balance b/d Cash in hand Cash at Bank

Amount Amount 1,05,000 10,000 20,500

5,000

12,000 4,300 7,000

40,000

1,300 59,000

2,64,100

1. Outstanding Tuition Fees Rs.12,000

2. Outstanding Salaries Rs.6,000

3. Depreciation Books by Rs.6,500 and Furniture by Rs.7,000

6. Mahakavi Kalidas Library, Kalyan, showed the following position of their accounting consider the adjustment given and prepare

income and expenditure account for the year ending 31.03.2013 library. Balance Sheet as on that date for the library


Liabilities Capital Fund Expenses Due

Amount

6,90,000 7,000

6,97,000

Assets Furniture Books Investment in securities Cash in hand Cash at Bank

Amount 72,500 5,15,000 50,000 8,500 15,000

6,97,000


Receipts To Balance b/d Cash in hand Cash in bank To Membership Subscription To Entrance Fees To Sake of scrap To Hire of Lecture Hall To Interest on Securities

Amount

8,500 15,000

1,80,000 25,000 1,500

18,000 4,000

2,52,000

Payments By Electricity Charges By Postage and Telephone By Book Purchased By Payment for Expenses Due By Sundry Expenses By Investment in securities By Furniture By Balance c/d Cash in hand Cash at bank

Amount 6,980 6,100

80,000 7,000

10,500 1,00,000 28,000

6,420 7,000

2,52,000

1. During the current year, Furniture was purchased on 01.10.2012. Depreciate Furniture @ 10%

2. Depreciate Books by Rs.1,00,000

3. Membership Subscription received during the year includes Rs.15,000 for the year 2013-2014 and Rs.7,500 are outstanding

for current year

4. Capitalize ½ of the Entrance Fees

7. From the following Balance Sheet and Receipts and Payment Account of Indian Hospital Pune. Prepare Income and Expenditure

Account for the year ending 31.03.02012 and Balance Sheet as on that date.


Liabilities Cash in Fund Medicines Bill unpaid

Amount 5,02,000

3,000

5,05,000

Assets Cash in hand Cash at bank Land and Building Furniture Equipments Outstanding Subscription

Amount 3,000 6,000

4,00,000 35,000 60,000 1,000

5,05,000

37



Receipts To Balance b/d Cash in hand Cash at bank To subscription (Includes Rs.1,000 Received for previous year) To Sale of Furniture (Book valve Rs.15,000) To Donations (revenue) To Life Membership Fees

Amount

3,000 6,000

65,000

10,000

22,000 12,500

1,18,500

Payments By Salaries By Medicines By Equipment Purchased By General Expenses By Balance c/d Cash in hand Cash at bank

Amount 55,000 26,000 10,000 4,300

7,700

15,500

1,18,500

1. Outstanding Subscription Rs.6,000

2. Capitalize the amount of Life Membership Fees

3. Outstanding Salary Rs.6,000

4. Depreciate Land and Building Rs.10,000 and Equipment by Rs.15,000

8. Following is the Receipts and Payment Accounts and additional information of Jeevandeep Hospital, Pune. Prepare Income and

Expenditure Account for the year ending 31.03.2013 and Balance Sheet as on that date.


Receipts To Balance b/d To Subscription 2011-2012 2012-2013 2013-2014 To Donation To Life Membership Fees To Hospital receipts(revenue)

Amount

15,000 1,90,000 30,000

Amount

2,35,000 1,10,000 50,000

3,00,000 7,07,000

Payments By Medicines By Honorarium to Doctors By Ambulance Maintenance By Hospital Equipment purchased By Furniture Purchased By Fived Deposit By Balance c/d

Amount Amount 20,000 1,50,000 88,000

60,000 50,000 2,00,000 1,39,000 7,07,000

1. Outstanding subscription for 2012-2013 is Rsw.10,000

2. Hospital Equipment and Furniture were purchased on 01.10.2012 and both the assets were to be depreciation @ 20%

3. Life Membership fees to be capitalized

4. Donations represent donations for Building fund

5. Staff Salary for current year is outstanding Rs.15,000

6. On 1.04.2012 the hospital had the following assets and Liabilities Land. Rs.5,00,000, Investment Rs.1,00,000 Bank Loan

Rs.4,00,000 Ambulance Rs.2,05,000

7. Capital Fund as on 1.04.2012 was Rs.4,32,00

9. Following is the Receipts and Payments Account of Life Line Hospital, Chandrapur, for the year ending on 31st March 2011 and

additional information. You are required to prepare Income and Expenditure Account for the year ending 31st March 2011 and

Balance Sheet as on that date.


Receipts To Balance b/d To subscription To Entrance Fees To Life membership Fees (Capitalized) To Sale of old Newspapers To Donations for Building Fund

Amount 10,500 92,700 1,100

15,000

600 1,20,000

2,39,900

Payments By Furniture By Medicines By Honorarium to Doctors By salary to staff By Sundry Expenses By Surgical Instrument By Fixed Deposit By Balance c/d

Amount 22,000 15,700 65,000 18,000 3,500

51,500 60,000 4,200

2,39,900

Additional Information:-

Particulars Outstanding Subscription Subscription received in advance Building Investment Capital Fund Building Fund

01.04.2010 8,800 7,500

11,00,000 1,50,000 8,61,800 4,00,000

31.03.2011 9,000 5,000

11,00,000 1,50,000

38


10. From the following information supplied to you by unique Social and Cultural Club, Nagpur, you ae required to prepare Income

and Expenditure Account for the year ending on 31.03.2013, and Balance Sheet as on the date.


Liabilities Capital Fund Building Fund Outstanding Salary

Amount 7,63,500 2,50,000 12,000

10,25,500

Assets Cash in Hand Cash at Bank Land Bank Deposits Outstanding Subscription

Amount 1,950

17,550 7,50,000 2,50,000

6,000 10,25,500


Receipts To Balance b/d Cash in Hand Cash at Bank To Subscriptions To Donations for Building Fund To Balance c/d ( Bank overdraft)

Amount

1,950 17,550 78,000

1,00,000 15,000

2,12,500

Payments By Salaries By Printing and Stationery By Furniture By Bank deposit By General Expenses By Charity By Balance c/d

Amount 58,000 4,500

20,000 1,00,000

3,500 20,000 6,500

2,12,500

1. Furniture was bought on 01.01.2012. It is to be depreciated @ 15% 2. Subscription outstanding for 2012-2013 was Rs.8,000 3. Salaries outstanding for 2012-2013 was Rs.4,000 4. Travelling expenses Rs.1,250 are outstanding

11. With the information given below, Prepare Income and Expenditure Account and Balance Sheet of Sudarshan charitable

Organization for the year ending on 31.03.2012

Dr Receipts and Payments Account for the year ending on 30.03.2012 Cr

Receipts To Balance b/d Cash in hand Cash at Bank To Subscriptions ( Includes Rs.5,000 for 2009-10) To Interest on Investments To Sale of Furniture ( Book Value Rs.10,000)

Amount

500 39,500

Amount

40,000 81,000

1,800 8,000

1,30,800

Payments By Salaries By Printing and stationery By Charity Expenses By Investments By Office Expenses By Balance c/d Cash in hand Cash at bank

Amount

700 10,100

Amount 18,000 20,000 20,000 60,000 2,000

10,800 1,30,800

1. There are Rs.800 members, paying annual subscription Rs.100 each. 2. Outstanding salary Rs.2,000 3. The Assets on 01.04.2012 were as following Furniture Rs.40,000, Investment Rs.20,000 , Land Rs.1,00,000 4. On 01.04.2011 Capital Fund was Rs.2,05,000

12. Following is the Receipts and Payments Account of Bavdhan Pensioners Association newly started on 01.04.2010


Receipts To Subscriptions received For 2010-2011 For 2011-2012 For 2012-2013 To Entrance Fees To Donations

Amount

85,000 6,900

2,000

Amount

93,900 11,000 25,000

1,29,900

Payments By Rent By Travelling Expenses By Expenses for get-together function By Charity By Salaries By Furniture By Fixed Deposit By Balance c/d

Amount Amount 6,000 2,800

3,300 1,000 4,500

30,500 50,000 31,800

1,29,900

1. Outstanding Subscription for current year Rs.10,000

2. Entrance Fees are to be capitalized

3. Capital Fund should be created out of Entrance Fees and surplus of the current year

4. Depreciate Furniture by Rs.2,500

Prepare Income & Expenditure account for the year ending 31/3/11 & Balance Sheet as on that date.

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13. The Following is the Receipts and Payments Account of Star Citizen Association. Bilaspur for the year ending 30.03.2012


Receipts To Balance b/d To Subscriptions 2010-2011 2011-2012 2012-2013 To Entrance Fees (to be capitalized) To Donations To legacies To Interest on Deposits To Picnic Receipts

Amount

3,900 81,500 2,500

Amount 5500

87,900 2,000

50,000 10,000 30,000 5,750

1,91,150

Payments By Postage and Telegram By Stationery Purchased By Fixed Deposits By Picnic Expenses By Salaries By Annual General meeting expenses By Insurance Premium By Sundry Expenses By Furniture By Balance c/d

Amount Amount 1,500 6,000

1,00,000 7,900

20,000

4,500 3,450 4,800

26,000 17,000

1,91,150

1. Outstanding Picnic Receipts Rs.4,250 2. Furniture was Purchased on 1.10.2011 and it is to be depreciated @ 10% 3. Outstanding Subscriptions for current year Rs.8,200 4. Stock of Stationery on 01.04.2011was Rs.650 and on 31.03.2012 was Rs.1150 5. Entire amount of legacies and 50% OF DONATIONS are to be capitalized 6. Capital Fund as on 1.4.11 was 10,050.

You are required to prepare Income and Expenditure Account for the year ending on 31.03.2012 and Balance Sheet as on that date

14. From the Following Information supplied to you, prepare Income and Expenditure Account for the year ending on 31.03.2013

and Balance Sheet as on that date for Suryodaya Club, Nasik


Liabilities Capital Fund Bank Overdraft Outstanding Salary

Amount 50,000 35,000 2,000

87,000

Assets Land Outstanding Subscriptions Prepaid Insurance Premium Cash in Hand Furniture

Amount 60,000 5,000 2,500 9,500

10,000 87,000


Receipts To Balance b/d To Subscription To Admission Fees

Amount 9,500

95,000 7,500

1,12,000

Payments By Bank Overdraft ( Repaid) By Salary By Insurance Premium By Interest By Miscellaneous Expenses By Furniture By Balance c/d Cash in Hand 5,400 Cash at Bank 25,000

Amount 35,000 12,500 8,000 1,700 4,400

20,000

30,400 1,12,000

1. Subscriptions received, includes Rs.3,000 for 2011-2012 and Outstanding Subscriptions for 2012-2013 was Rs.8,000 2. Salary Paid includes Rs.2,000 Paid for last year 3. On 31.03.2013, Prepaid Insurance Premium was Rs.3,000 4. Admission Fees are to be capitalized 5. Depreciate Furniture by Rs.2,000

15. From the information given below of Jeevan Vikas Vidyalaya Khamgoan, You are required to prepare, Income and Expenditure Account and Balance Sheet for the year ending on 31.03.2011

Balance Sheet as at 01.04.2010

Liabilities Capital Fund Loan

Amount 4,99,100 5,00,000

9,99,100

Assets Library Books Laboratory Equipments Furniture Building Cash in Han Cash at Bank

Amount 1,15,500 1,25,000 1,10,000 6,25,000

3,500 20,100

9,99,100

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Receipts To Balance b/d Cash in Hand Cash at Bank To Tuition Fees To Term Fees To Admission Fees To Government Grant ( Revenue) To Sundry Receipts

Amount

3,500 20,100

3,67,500 35,000 30,600

3,50,000 1,300

8,08,000

Payments By Salaries By Purchases Laboratory Equipments 10,000 Library Books 50,000 Furniture 20,000 By Sundry Expenses By Printing and Stationery By Annual Social Gathering Expenses By Balance c/d Cash in Hand Cash at bank

Amount 6,25,200

80,000 10,000 35,800

18,000

4,000

35,000 8,08,000

1. Tuition Fees Outstanding Rs.13,500 2. Outstanding Interest on Loan Rs.60,000 3. Entire Admission Fees are to be Capitalized 4. Depreciation is to written as under:

Library Books Rs.50,000 , Furniture Rs.30,000, Laboratory Equipment Rs.20,000, Building Rs.30,000

16. Following information has been provided by Janseva charitable Hospital, Latur. You are required to prepare Income and

Expenditure Account for the Year ending on 30.03.2013 and Balance Sheet as on that date.


Liabilities Capital Fund Bank Loan Outstanding bill for Drugs

Amount 10,37,000 6,00,000 45,000

16,82,000

Amount Building Ambulance Stock of Drugs Hospital Equipments Cash in Hand

Amount 10,00,000 3,50,000 35,000

2,95,000 2,000

16,82,000

Dr Receipts And Payments Account for the year ending 30.03.2013 Cr

Receipts To Balance b/d To Subscription To Life Membership Fees To Hospital Receipts ( Revenue)

Amount 2,000 2,10,000 27,500 5,20,900

7,60,400

Payments By Purchases of Drugs By Salary to staff By Honararium to Doctors By Repairs and Maintenance By Furniture By General Expenses By Balance c/d

Amount 1,90,000 85,000 3,85,000 17,900 40,000 12,600 29,900

7,60,400

1. On 31.03.2013 stock of Drugs was valued Rs.20,000

2. Depreciate Building @ 5% and ambulance by Rs.20,000

3. Life Membership Fees are to be capitalized.

17. Following is the Accounting Information for the year 2009-2010 of Cricket Club, Pune; you are required to prepare Income and

Expenditure Account as on 31.3.2010 and Balance Sheet as on that date


Liabilities Capital Fund Building Fund Bank overdraft

Amount 67,100 54,000 37,400

1,58,500

Assets Land Sports Material Cash in hand Outstanding Subscriptions 2007-2008 1,800 2008-2009 2,500

Amount 1,20,000 32,000 2,200

4,300 1,58,500

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Receipts To Balance b/d ( cash in hand) To Subscription 2007-2008 2008-2009 2009-2010 To Donations To Entertainment Receipts To Entrance Fees

Amount

1,800 2,500

65,500

Amount 2,200

69,800 11,000 8,800 2,000

93,800

Payments Bank Overdraft By Salaries By Electricity Charges By Rent & Taxes By Printing and Stationery By Entertainment Expenses 30.01.2010 By Balance c/d Cash in hand Cash at bank

Amount Amount 37,400 25,600 2,250 1,750 5,100 8,700

3,000 10,000 93,800

1. Donation are received for building Fund

2. Entrance fees are to be Capitalized

3. Outstanding Subscription Rs.1,500

4. Depreciate Sport Material @ 12 ½

18. From the following Receipts and Payments Account of Nanasaheb Patil Engineering College, Faizpur For the year ending 31st

March 2013 and additional information, prepare Income and Expenditure Account for the year ending 31.02.2013 and Balance Sheet

as on that date.


Receipts To Balance b/d Cash in Hand Cash at Bank To Interest To Subscriptions To Life Membership Fees To Donations To Tuition Fees To Term Fees To Admission Fees To Sundry Receipts

Amount

15,950 1,00,070 51,000 25,800 20,500

6,36,000 11,20,000 2,00,900 55,000 6,930

22,32,150

Payments By Salaries to Teaching Staff Office staff By Electricity By Books By Furniture By Stationery By Fixed Deposit (31.3.2013) By Balance c/d Cash in Hand Cash at Bank

Account

8,50,500 1,81,000 51,900 57,800 45,000 19,950

7,50,000

13,500 2,62,500

22,32,150

Additional Information 1.

Particulars Books Furniture Building Fund Fixed Deposits Capital Fund

01.04.2012 5,50,000 2,15,000 9,35,000 8,00,000 7,46,020

30.03.2013 5,50,000 2,00,000

2. 50% of Donations are for Building Fund and the balance is to be treated as revenue income 3. Outstanding Subscription Rs.4,200 4. Life Membership Fees are to Capitalized

BILLS OF EXCHANGE

1) On 7th July 2010 Sindhutai sold goods to Bahinabai on credit for 3 months for Rs. 21000. For discharging amount due

Bahinabai paid cash of Rs 5000 and accepted bill for the balance at 2 months. On the same date Sindhutai discounted the bill with her bank for Rs. 15820. You are required to pass journal entry in the books of Sindhutai assuming that, on due date the bill is dishonoured and Sindhutai discounted and Sindhutai’s bank paid noting charges Rs.100.

2) On 28th Feb. 2011 Kumar purchased goods from Kishor for Rs. 25000 and gave his acceptance after sight for 60 days on 2ndMarch, 2011 for the amount due. On the same date Kishore deposited the bill into bank collection. On the due date Kumar honoured his acceptance.

A. You are required to pass journal entries in the books of both parties. B. You are required to pass journal entries in the books of Kishor and Kumar assuming that on due date Kumar

dishonoured his acceptance and bank paid noting charges Rs. 250.

3) Amaranth sells goods for Rs. 1000 to Badrinath and draws a bill at three months for the amount. Badrinath accepts it and returns to Amarnath. Badrinath retires his acceptance under rebate of Rs. 10. Record the transaction in the books of Amarnath and Badrinath.

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4) Soham sold goods TO Rohan worth Rs. 30,000 on 1st March 2010. Rohan accepted a bill for three months drawn on him by Soham on 1st March 2010. On 21st May, Rohan requested that the bill be renewed for a further period of two months. Soham agreed provided 10% interest p.a. would be charged. Soham then drew a new bill for the amount of original plus interest at 10% p.a. for two months. Rohan accepted the new bill. On due date the new bill was honoured. Prepare journal in the books of Soham and Rohan.

5) Sharad sold goods to Damodhar worth Rs. 20000, taking a bill of exchange at 3 months dated 1st July 2010. On 4th August he discounted the bill at 15% p.a. with his bank. On maturity the bill was returned by the bank as dishonoured and Sharad had to pay the amount of bill to the bank. Damodhar paid Rs. 8000 to Sharad and accepted a new bill at three months for Rs. 12000 plus 18% p.a. interest. But before maturity, he became insolvent and only 50% amount was received as first and final dividend from his estate. You are required to give journal entries in the books of Sharad and Damodhar.

6) On 11.9.2011 Arun sold goods for Rs. 10000 to Varun and drew upon him a bill of exchange payable 3 months after date. Varun accepted the bill and returned the same to Arun. On the date the bill was met by Varun. Record the necessary journal entries in the books of Arun and Varun in the following circumstance.

1. When the bill was retained by Arun till the date of its maturity. 2. When the bill was endorsed immediately by Arun in the favour of his creditor Suresh. 3. When Arun immediately discounted the bill @ 12% p.a. with his bank. 4. When three days before its maturity, the bill was sent by Arun to his bank for collection.

7) Arvind a wholesale trader allowed a trade discount of 20% on the list price of the goods purchased from them. The retail

traders made the following purchases from Arvind. Date Particulars L.F Outward invoice no. Gross

price Net

price 2010

June 21 June 26 June 28 June 30

Jyoti Snehal Jyoti Snehal

1280 1289 1292 1299

10000 12000 20000 15000

8000 9600

16000 12000

Total as per sales book 57000 45600 For all the purchases Jyoti and Snehal accepted the bills in favour of Arvind payable after 30 days on June 21 2010 was retained by Arvind with him till date of maturity. The acceptance for sale on June 26 2010 was discounted by Arvind with his bank at 12% p.a. The acceptance for sale on June 28 2010 was endorsed by in favour of his creditor Kavita. On July 15 2010 he sent acceptance for sale on June 30 2010 to his bank for collection. All the bills accepted by Snehal honored on due dates but bills accepted by Jyoti were dishonoured for which 0.5% noting charges were paid on 5th August 2010. Jyoti paid the amount due on her account. Record the necessary journal entries for the above transactions in the books of Arvind. Also prepare Jyoti’s and Snehal’s account in his books.

8) On 14th May 2010 Vinita bought goods for Rs. 16000 from Vasudha and agreed to pay the amount due in two equal installments falling due for payment after 3 and 4 months. Accordingly on the same day Vasudha drew two bills for the equal amount for 3 and 4 months period respectively which Vinita accepted and returned immediately. On 21st May Vasudha sent 4 month acceptance to her bank for collection. On the due date of the respective bills: Vinita honoured 3 month acceptance and dishonoured the second for which Vasudha paid noting charges Rs. 40 and her bank debited Rs. 30 for bank charges. However on 21st September 2010 Vinita issued a cheque in full settlement of her account. Pass journal entries in the books of Vasudha and Vinita.

9) On 18th Nov. 2011 Swapnil sold on credit for Rs. 12000 to Abhijit on the condition that he should pay the amount due in two installments of Rs. 5000 and Rs. 7000 due for payment after 2 and 3 months by accepting the bills of exchange. Accordingly, Abhijit accepted two bills and returned to Swapnil. On 21st Nov. Swapnil sent 2 months acceptance to his bank for collection and discounted 3 months acceptance with his bank @ 12% p.a. On the due date of the respective bills Abhijit honoured 2 months acceptance and dishonoured 3 months acceptance for which bank paid noting charges Rs. 80. Pass the journal entries in the books of Swapnil and prepare Abhijit’s account in his ledger.

10) On 10th August 2011 Ramachandra drew a bill of Rs. 11000 for 90 days after date on Vikaschandra. On 16th August, 2011 Ramachandra purchased goods from Harishchandra worth Rs. 15000 at 10% trade discount on credit. On the same date Ramachandra endorsed Vikaschandra’s bill in favour of Harishchandra and paid the balance by cheque. On the same date Harishchandra discounted the bill with his bank for Rs. 10750. On the date of maturity of a bill government declared emergent holiday; Harishchandra’s bank presented the bill, as per the provisions of Negotiable Instrument Act, which was met by Vikaschandra. You are required to pass journal entries in the books of Ramachandra, Vikaschandra and Harishchandra.

11) On 5th September 2010 Tinku accepted a bill of Rs. 6000 drawn by Rinku for 3 months after sight. This bill was drawn for amount which Tinku owed to Rinku for goods brought on credit. On same date Rinku purchased goods from Pinku for Rs. 8500. For this settlement of amount due, Rinku endorsed Tinku’s acceptance in favour of Pinku and accepted 2 months bill for the balance. On 5th October 2010 Pinku discounted both the bills with his bank @ 15% p.a. On the due date Tinku honoured his acceptance while Rinku was unable to meet the payment for her acceptance. Pinku’s bank paid noting charges Rs. 100. Pass journal entries in the books of Pinku and also prepare Tinku & Pinku ledger accounts in the books of Rinku.

12) Amit of Malkapur draws a bill on Ajay of Amravati for Rs. 12000 at 3 months. Ajay accepts and return to Amit. Amit then sent the bill into his bank for collection. On due date Ajay finds himself unable to make payment of the bill and requests Amit to renew it. Amit accepted the proposal on the condition that Ajay should pay Rs. 2000 on account along with interest Rs. 500 in cash; and should accept new bill for the balance at 2 months. These arrangements were carried through. One month before Ajay retired his acceptance by payment Rs. 9700.

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13) On 1st October 2011 Nehalika draws a bill for Rs. 20000 on Tanaya for 4 months period. The bill was duly accepted and returned to Nehalika. One month after the date Nehalika discounted the bill with her bank @ 12% p.a. Before due date Tanaya dishonoured her acceptance. Bank paid noting charges Rs. 125. Tanaya requested to renew the bill for further period of 2 months. Nehalika agreed, she took the bill back from bank and received new acceptance for 50% amount of the bill plus full amount of noting charges and for balance 50% plus interest Rs. 200. Before the due date Tanaya was declared as insolvent and nothing could be recovered from her private estate. Write journal of Nehalika and Tanaya for the above bill transaction.

14) Snehal owes Akshay Rs. 25000. Akshay draws a bill for Rs. 21000 on Snehal for 3 months period and received the cheque for the balance. The bill is duly accepted and returned to Akshay. On the same date Akshay endorsed Snehal’s acceptance to Amod. On the due date Amod informed Akshay that Snehal dishonoured her acceptance and paid Rs. 175 as noting charges. Akshay then drew new bill for 1 month on Snehal including noting charges and interest Rs. 600. On the due date Snehal honoured the bill by cheque. Write journal entries in the books of Akshay and prepare Akshay’s account in the books of Snehal.

15) On 7th May 2011 Barve of Karvenagar draws a bill on Langekar of Latur for Rs. 8000 at 3 months. Langekar accepts and returns to Barve. Barve then sends the Bill into his bank for collection. On due date Langekar finds himself unable to make the payment of the bill and requests Barve to renew it. Barve agreed on the condition that Langekar should pay Rs. 5000 in cash, and should accept new bill for the balance of 2 months with interest Rs. 200. These arrangements were carried through. Before due date Langekar was declared as insolvent and Rs. 1500 could be recovered from his private estate as first and final dividend. Give journal entries in the books of Barve & Langekar.

16) On 14th May 2012 Devidas Sheth sold goods on credit and for the said amount due draws a bill on Khushal Sheth for Rs. 30000 at 4 months. Khushak Sheth accepted it and returned to Devidas Sheth. On 17th June 2012 Devidas Sheth discounted it with his bank @ 18% p.a. On due date Khushal Sheth dishonoured his acceptance and bank paid the noting charges Rs. 250. Then Khushal Sheth requested Devidas Sheth to renew it. He agreed on the condition that Khushal Sheth pay interest on the balance due @ 18% p.a. plus noting charges by cheque, and should accept new bill for the balance at 2 months. These arrangements were carried through. Before due date Khushal Sheth was declared as insolvent. On 15th Dec. 2012 Devidas Sheth recovered 40% of the amount due from private estate as final dividend. Give journal entries in the books of Devidas Sheth, also prepare Devidas Sheth’s account in the books of Khushal Sheth.

17) On 1st April 2012 Kantilal drew a bill of Rs. 18000 on Maganlal for 4 months. The bill was duly accepted by Maganlal. On 5th April 2012 Kantilal endorsed the bill in the favour of Shankarlal. However on 1st August 2011 Maganlal approached to Kantilal and requested bill be renewed for a further period of 3 month at 15% p.a. Kantilal agreed and paid necessary money to Shankarlal. Before one month of the due date of the new bill Maganlal retired his acceptance @ 10% p.a. Pass journal entries in the books of Kantilal and Maganlal.

18) Journalize the following bill transaction in the books of Govinda as on 16th Nov. 2011. 1. Krishna’s acceptance to Govinda Rs. 9600 retired one month before due date at rebate 12% p.a. 2. Discounted 4 months acceptance of Kaliya for Rs. 15000 with bank @ 10% p.a. 3. Received cheque and 2 months acceptance drawn on Sudama for Rs. 10000 for the balance due Rs. 11500. 4. Endorsed Vasudev’s acceptance at 60 days of Rs. 5000 in favour of Balaram and paid cash Rs. 2500 in full

settlement of his account Rs. 7600.

19) Journalize the following bill transactions as on 21st May 2010 in the books of Pradhan. A. Renewed Venkatesh’s acceptance of Rs. 700 due on 21st May 2010 with interest Rs. 500 for 2 months. B. Bank informed that Laxmipati’s acceptance of 4000 which was discounted dishonoured, bank paid noting charge

Rs. 85. C. Veermani informs Pradhan that Sonali’s acceptance for Rs. 7000 endorsed to Veermani has been dishonoured.

Noting charges amounted Rs. 80. D. Shrivasthav honoured his acceptance of Rs. 4900 which was deposited into bank for collection.

20) Journalize the following bill transactions as on 31st July 2011 in the books of Omkarnath.

a) Renewed Varthak’s acceptance of Rs. 6000 due on 31st July 2010 by accepting cash Rs. 2000 and drawing bill for the balance with interest @ 18% p.a. for 2 months.

b) Accepted a bill of Rs. 5000 at 3 months at Singh, drawn by Avinash for the amount due to him Rs. 6000 and balance paid in cash.

c) Fattechand honoured his acceptance of Rs. 9000 which was deposited into bank for collection and bank debited Rs. 80 for bank charges.

d) Bank informed that Laxmi’s acceptance of Rs. 14000 which was discounted dishonoured, bank paid noting charges Rs. 85. Renewed at Laxmi’s request for next 1 month with interest Rs. 215.

21) Journalise the following transaction on the following dates in the books of Aditi. A. On 1st April 2010 Arti informs Aditi that Amprapali’s acceptance of Rs. 12000 endorsed to her dishonoured and

noting charges paid Rs. 250. B. On 21st April 2010 Aditi renews her acceptance for Rs. 17000 to Arush by paying cash Rs. 2000 and accepting new

bill for 2 months for the balance plus interest @ 10% p.a. C. On 15th March 2010 Namrata retired her acceptance to Aditi of Rs. 6500 by paying cash Rs. 6300. D. 31st March 2010 recovered Rs. 2500 from the private estate of Shridhar who was declared as insolvent, against bill

accepted by him Rs. 4000 which was dishonoured by him on 29th December 2009 and noting charges paid Rs. 100.

22) Journalise the following transaction on the following dates in the books of Vaishnavi. A. On 1st October 2011 Shrikant informs Vaishnavi that Navnath’s acceptance of Rs. 25000 endorsed to him

dishonoured and noting charges paid Rs. 350. B. On 11th October 2011 Subhodh’s acceptance for 90 days Rs. 6500 dated and recorded on 24thSeptember 2010

deposited into bank for collection. C. On 15th October 2011 Vaishavi sold goods to Vinita for Rs. 1500 and received her acceptance for the same amount

which was endorsed to Vrinda.

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D. 25th October 2011 recovered 25% of the amount due from the private estate of Sampada who was declared as insolvent, against bill accepted by her for Rs. 8000 which was dishonoured on 29th September 2011 and noting charges paid Rs. 100.

E. On 31st October, Vaishnavi renews her acceptance of Rs. 9000 to Arundhati by paying cheque Rs. 4000 and accepting new bill for 2 months for the balance plus interest @ 12% p.a.

23) Hitesh sold goods for Rs. 4500 to Ashok on 1.1.2010 and drew upon him a bill of exchange payable 2 months after sight. Ashok accepted the bill and returned the same to Hitesh. On the due date the bill was met by Ashok. Record the necessary journal entries in the books of Hitesh and also prepare Ashok account in his books.

1. When the bill was retained by Hitesh till the date of its maturity. 2. When Hitesh immediately discounted the bill @ 15% p.a. with his bank. 3. When three days before his maturity, the bill was sent by Hitesh to his bank for collection. 4. When the bill was endorsed immediately by Hitesh in the favour of his creditor Venkat.

24) On 2nd Jan. 2011 Kiran of Kanpur purchased goods from Kavita of Kedgaon for Rs. 4850 and gave her acceptance to after

date bill for 90 days on 5th Jan. 2011 for the same amount. On the same date Kavita of Kedgaon deposited the bill into bank for collection. On the due date Kiran honoured her acceptance. You are required to pass journal entries in the books of both the parties.

25) Vasanti sold goods on credit of Rs. 8500 to Aruna on 14th July 2009. On the same date Vasanti drew 2 bills for Rs. 5000 & Rs. 3500 for 2 and 3 months respectively. Aruna accepted and return immediately. On 21st July 2009 Vasanti deposited 3 months acceptance to her bank for collections. On due date of the respective bills Aruna honoured 2 months acceptance but dishonoured the second for which Vasanti paid noting charges Rs. 60 and her bank debited Rs. 50 for bank charges. Pass the journal entries in the books of Vasanti and Aruna.

26) Sudhatai sold goods to Chhayatai on credit for 4 months for Rs. 10000 on 7th Sept. 2009. Chhayatai paid on her account of Rs. 4000 at 2% cash discount and accepted bill for the balance at 2 months. On the same date Sudhatai discounted with her bank at 12% p.a. on due date Chhayatai honoured the bill.

A. You are required to write journal of Sudhatai. B. Pass journal entries in the books of Sudhatai assuming that on due date the bill is dishonoured and Sudhatai's bank

paid noting charges Rs. 100.

27) On 1st August 2010 Swapnali sold goods to Swapnil on credit for Rs. 20000. And drew 2 bills of 60% and 40% of the amount due from Swapnil for 3 and 4 months period respectively. Swapnil accepted and returned it to Swapnali immediately. On 1st Sept. 2010 Swapnil send 3 months acceptance to her bank for collection and discounted 4 months acceptance with her bank @ 18% p.a. On the due date of the respective bills Swapnil honoured 3 months acceptance for which bank debited Rs. 50 as bank chares. On due date of 4 months acceptance Swapnil dishonoured for which Swapnali’s bank paid noting charges Rs. 100.

28) On 1st August 2012 Omprakash drew a bill of Rs. 10000 for 60 days after date on Sharadchandra. On 15th August 2012 Omprakash purchased goods from Hariprasad for Rs. 12000. On the same date Omprakash endorsed Sharadchandra’s bill in favour of Hariprasad and paid the balance by Cheque at 1% cash discount. On the same date Hariprasad discounted the bill with his bank for Rs. 9500. On the due date Sharadchandra honoured his acceptance presented by Hariprasad. You are required to pass journal entries in the books of Omprakash, Sharadchandra and Hariprasad.

29) On 5th September 2010 Prakash Patil accepted a bill of Rs. 16000 drawn by Chandu Chaudhari for 3 months. This bill was drawn for amount which Prakash Patil owed to Chandu Chaudhari. On the same date Chandu Chaudhari purchased goods from Magan Mahajan for Rs. 20000 for this Chandu Chaudhari endorsed Prakash Patil’s acceptance in favour of Magan Mahajan and accepted 2 months bill for the balance due. On 5th October 2010 Magan Mahajan discounted both the bill with his bank @ 12% p.a. On the due date Prakash Patil’s honored his acceptance while Chandu Chaudhari unable to meet the payment for his acceptance. Magan Mahajan’s bank paid noting charges Rs. 100. Pass journal entries in the books of Magan Mahajan and also prepare Prakash Patil’s & Magan Mahajan ledger account in the books of Chandu Chaudhari.

30) Harbhajan draws a bill on Manmit for Rs. 8000 for 3 months. Manmit accepts and returns Harbhajan. Harbhajan then sends the bill towards the bank for collections. On due date Manmit finds himself unable to make payment of the bill and request Harbhajan to renew it. He accepted the proposal on the condition that Manmit should pay Rs. 2000 along with interest @ 15% p.a. in cash and should accept new bill for the balance at 2 months. These arrangements were carried through. One month before Manmit retired his acceptance @ 12% p.a. Give journal entries and Manmit’s account in the books of Harbhajan.

31) On 1st April 2011 Umakant draws a bill for Rs. 25000 on Laxmikant for 4 months period. The bill is accepted and returned to Umakant. On the same date Umakant discounted the bill with his bank @ 12% p.a. Before due date Laxmikant finds himself unable to make payment of the bill, hence required Umakant to renew the bill for further period of 2 months. Umakant agreed and he took the bill back from the bank and received new acceptance for Rs. 26000 including interest, this new bill is duly honoured by Laxmikant on due date. Write journal of Umakant and Laxmikant for the above bill transactions.

32) On 1st June 2010 Narayan draws a bill for Rs. 50000 on Chunnilal for 4 months period. The bill is accepted and returned to Narayan. One month after the date Narayan discounted the bill with the bank @ 18% p.a. Before due date Chunnilal dishonoured his acceptance. Bank paid noting charges Rs. 1125. Chunnilal requested to renew the bill further period of 2 months. Narayan agrees he takes the bill back from the bank and received new acceptance for 40% amount of the bill with full amount of noting charges and cheque for 60% balance plus interest @ 12% p.a Bfore the due date Chunnilal declared as insolvent and 30% of the amount due could be recovered from his private estate. Write journal of Narayan and Chunnilal for the above bill transactions.

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33) Sushant owes Surekh Rs. 125000. Surekh draws a bill for Rs. 100000 on Sushant for 4 months period and received cheque for the balance. The bill is duly accepted and returned by Sushant. On the same date Surekh endorsed Sushant’s acceptance to Suresh. On due date Suresh inform Surekh that Sushant dishonoured his acceptance and Rs. 3175 paid as noting charges. Surekh then drew a new bill for 3 months on Sushant including noting charges and interest Rs. 4000. On due date bill was duly honoured by Sushant. Write Journal entries in the books of Surekh and prepare Surekh’s account in the books of Sushant.

34) On 7th May Kulkarni of Karvenagar draws a bill on Patwardhan of Latur for Rs. 18000 at 3 months. Patwardhan accepts and returns it to Kulkarni. Kulkarni then sent the bill into his bank for collection. On due date Patwardhan finds himself unable to make payment of the bill and request Kulkarni to renew it. Kulkarni agrees on one condition that Patwardhan should pay Rs. 5000 in cash, and should accept new bill for the balance at 2 months with interest @ 18% p.a. These arrangements were carried through. Before due date Patwardhan declared insolvent and 20% of the amount could be recovered from his private estate as first and final dividend. Give journal entries in the books of Kulkarni. Also prepare Kulkarni’s account in the books of Patwardhan.

35) On 1st Sept. 2010 Badrinath drew a bill of Rs. 20000 on Dinanath at 4 months. The bill was duly accepted by Dinanath. On 5th Sept. 2010 Badrinath endorsed the bill in favour of Somnath. However on 1st January 2011 Dinanath approached to Badrinath and requested bill be renewed for further period of 3 month at 15% p.a. Badrinath agreed and paid necessary money to Somnath. Before 1 month of the due date of the new bill Dinanath retired his acceptance @ 10% p.a. Pass journal entries in the books of Badrinath and Dinanath.

36) Journalise the following transactions in the books of Gopal as on 14th August 2010. 1. Shruti’s acceptance to Gopal Rs. 4500 retired one month before due date at rebate 10% p.a. 2. Discounted 3 months acceptance of Chandrakant for Rs. 3500 with Bank @ 12% p.a. 3. Received cheque of Rs. 2000 and 2 months acceptance drawn on Sushma for Rs. 10000 for the balance due on her

account. 4. Endorsed Shantaram’s acceptance at 2 months of Rs. 5000 in favour of Balachandra and paid cash Rs. 2500 in full

settlement of his account Rs. 7800. 5. Sold goods of Rs. 13500 on credit to Nanda. Drew 2 months bill on her. Which is duly accepted & returned by her.

37) Journalise the following transactions in the books of Prabhodhan as on 21st May 2010.

1. Renewed Veerendra’s acceptance of Rs. 17500 due on 21st May 2010 with interest Rs. 500 for 2 months. 2. Bank informed that Radhabai’s acceptance of Rs. 1400 which was discounted dishonoured, bank paid noting

charges Rs. 185. 3. Sent acceptance of Rs. 12000 at 120 days after sight, drawn by Mudhukar for the amount due to him. 4. Pandharinath honoured his acceptance of Rs. 8500 which was deposited into bank for collection.

38) Journalise the following transactions in the books of Pratapsing as on 31st July 2011.

1. Renewed Vinayak’s acceptance of Rs. 6000 due on 31st July 2011 by accepting cash Rs. 2000 and drawing bill for the balnce with interest @ 18% p.a. for 3 months.

2. Accepted a bill of Rs. 5000 at 3 months at sight, drawn by Arvind for the amount due to him Rs. 6000 and balance paid by cheque.

3. Jethabhai honoured his acceptance of Rs. 9800 which was deposited into bank for collection and bank debited Rs. 80 for bank charges.

4. Bank informed that Prajakta’s acceptance of Rs. 4000 which was discounted dishonoured, bank paid noting charges Rs. 85. Renewed at her request for next 2 months with interest @ 18% p.a.

39) Journalise the following transactions on following dates in the books of Ankur. 1. On 1st April 2011 Kiran informs Ankur that Kajol's acceptance of Rs. 8000 endorsed to her dishonoured and noting

charges paid Rs. 250. 2. On 11th April 2011 Ankur renews his acceptance of Rs. 7400 to Amol by paying cash Rs. 2400 and accepting new bill

for the balance plus interest @ 15% p.a. 3. On 15th April 2011 Nilima retired her acceptance to Ankur of Rs. 5700 by paying cash Rs. 5300. 4. On 21st April 2011 recovered 50% of the amount due, from the private estate of Liladhar who declared as

insolvent, against his bill of Rs. 3800 which was dishonoured by him on 29th Dec. 2010 and noting charges paid Rs. 80

40) Journalise the following transactions on following dates in the books of Gajanan. 1. On 3rd Oct. 2012 Bankatlal informs Gajanan that Navnath’s acceptance of Rs. 16000 endorsed to him dishonoured

and noting charges paid Rs. 200. 2. On 9th Oct. 2012 Vishwanath’s acceptance for 120 days of Rs. 15500 dated 24th Sept. 2008 deposited into bank for

collections. 3. On 11th October 2012 Gajanan sold goods to Kartik for Rs. 4500 and received own acceptance from him which was

given to Milind of Rs. 4500 and due for payment on this date. 4. 20th Oct. 2012 recovered 40% of the amount due the private estate of Jyoti who declared as insolvent, against bill

accepted by her for Rs. 6000 which was dishonoured on 29th September 2008. 5. On 21st Oct. 2012 Gajanan renews his acceptance of Rs. 7500 to Pandurang by paying cheque Rs. 3500 and

accepting new bill for 2 months for the balance plus interest @ 18% p.a. Additional Problems BILLS OF EXCHANGE

41 On 1st March, Ramchandra sold goods to Raman worth Rs. 8,000 and Raman accepted the bill for Rs. 8,000 at 2 months drawn

by Ramchandra. Ramchandra discounted the bill with the bank at 6% p.a. On due date, the bill was dishonoured and Raman

requested Ramchandra to accept Rs. 4,000 immediately and draw upon him a new bill for the remaining amount at 3 months

together with interest at 10% p.a. Ramchandra agreed. The second bill was duly honoured. Give Journal entries in the books of

Ramchandra.

42 On 1st January 2002, Shri Jameershet, Jalgaon sold goods to Shri Nanchand, Nagpur for Rs. 80,000. On the same date Shri

Jameershet drew a bill on Shri Nanchand for the same amount at 3 months. Shri Nanchand accepted the bill and returned the

same to Shri Jameershet. On 4th January 2002 Shri Jameershet discounted the bill with his bankers at 10% p.a. On the due date

46


bank informed that the bill was dishonoured and Shri Nanchand requested Shri Jameershet to accept Rs. 40,000 immediately

and draw upon him a new bill for the remaining amount for 2 months together with interest at 12% p.a. Shri Jameershet agreed.

The second bill was duly honoured. Pass necessary journal entries in the books of Shri Jameershet and show Shri Jameershet’s

A/c in the books of Shri Nanchand.

43 Premlal sold goods to Sunderlal worth Rs. 10,000 and Sunderlal accepted the bill for Rs. 10,000 at 2 months drawn by Premlal.

Premlal discounted the bill with the bank at 6% p.a. On due date, the bill was dishonoured and Sunderlal requested Premlal to

accept Rs. 4,000 and also the interest in cash on remaining amount at 10% p.a. for three months. Premlal agreed and for the

balance Sunderlal accepted a new bill at 3 months. This bill was duly honoured on due date. Give journal entries in the books of

Premlal.

44 Archana purchased goods from Babita on credit for Rs. 10,000 and accepted a bill drawn by Babita for 4 months. Babita

discounted the bill with her bank for Rs. 9,600. Before the due date, Archana approached Babita with a request to renew the

bill. Babita agreed but with the condition that Archana should pay Rs. 6,000 with interest Rs. 120 & accept a new bill for the

balance. The arrangements were duly carried out. New bill is met on due date. Pass journal entries in the books of Babita.

45 Bhagwat sold goods to Deo for Rs. 3,000. On the same date, Deo accepted a bill at 2 months, which Bhagwat endorsed to

Ishwar. On the due date of the bill, Ishwar informed Bhagwat that the bill was dishonoured and Rs. 20. was paid as noting

charges. Bhagwat then drew a new bill on Deo for the amount due including noting charges and interest Rs. 130. Before the due

date of the second bill, Deo became Bankrupt and only 20 paise in the rupee was received from his estate as first and final

dividend. Pass journal entries in the books of Bhagwat.

46 Mahendra sold goods to Ravindra for Rs. 6,000. Ravindra accepted Mahendra’s bill for Rs. 6,000 payable after 3 months.

After a month Mahendra discounted the bill with his bank at 10% p.a. On due date Ravindra dishonoured his acceptance.

Ravindra paid Rs. 3,000 to Mahendra and accepted a fresh bill for 3 months for the balance including interest @ 8% p.a. Before

the maturity of the bill Ravindra became insolvent and 50 paise in a Rupee were received form Ravindra as first and final

dividend from his estate. Pass journal entries in the books of Mahendra.

47 Rupa purchased goods from Deepa on credit for Rs. 10,000 and accepted a bill drawn by Deepa for four months. Deepa.

Deepa discounted the bill with her bank for Rs. 9,700. Before due date, Rupa approached Deepa with a request to renew the Bill .

Deepa agreed but with the condition that Rupa should pay Rs. 6000 with interest of Rs. 120 and accept a new bill for the balance,

The arrangements were duly carried out. The New bill is met on due date. Pass the necessary journal entries in the books of

Deepa.

48 Kale sold goods to Gore for Rs. 3,000. Kale drew a bill of Rs. 3,000 on Gore for 3 months. Gore accepted it and returned to

Kale. Kale sent the bill to bank for collection. But before the due date, Gore approached Kale with request for renewal of a bill.

Kale agreed to his request with the condition that he should pay Rs. 800 in cash and should accept a fresh bill for balance

including interest of Rs. 60-. These arrangements were carried through. The new bill was retired for Rs. 2,250. Pass journal

entries in the books of Kale.

49 Rohini of Ahmednagar sold goods worth Rs. 36,000 to Mohini of Kolhapur. On the next day, Mohini paid Rs. 16,000 in cash to

Rohini and accepted three months bill drawn by Rohini for the balance. Rohini, then discounted the bill at 10% p.a. with her

bank. Mohini finds herself unable to make payment of the bill and request Rohini to renew it. Rohini accepts the proposal on the

condition that Mohini should pay Rs. 8,000 in cash and accept a new bill for 3 months for the balance along with interest @ 12%

p.a. These arrangements were carried through. On the same day Rohini sent the new bill to the bank for collection. On the due

date the new bill was honoured and bank charges debited were Rs. 100. Pass Journal entries in the books of Rohini and open

Rohini’s account in the books of Mohini.

50 Ishwar bought goods from Bhagwan for Rs. 20,000. On the same date Ishwar accepted 3 months bill drawn by Bhagwan..

Bhagwan then endorsed the bill to Dev. On the due date, Dev informed Bhagwan that the bill was dishonoured and Rs. 100 was

paid as noting charges. Bhagwan then drew a new bill on Ishwar for the balance amount including noting charges and interest

@12% for 3 months. Before the due date, Ishwar became insolvent and only 1/3 of the amount due was recovered from his

private estate as first and final dividend.

Pass necessary journal entries in the books of Ishwar.

51. Anil sold goods to Ravindra for Rs., 6,000. Ravindra accepted Anil’s bill for Rs, 6000 payable after 3 months. After a month Anil

discounted the bill with his bank at 10% p.a. On the due date, Ravindra dishonoured his acceptance. Ravindra paid Rs. 3000 to

Anil and accepted a fresh bill for 3 months for the balance including interest @8% p.a. Anil sent the bill to bank for collection.

On due date, Ravindra honoured the bill.

Pass the Journal Entries in the books of Anil.

52. Anjali of Nagpur sold goods worth Rs. 25,000 to Rupali of Amaravati. On next day Rupali paid Rs. 10,000 in cash and accepted

two months bill for the balance drawn by Anjali.. Anjali discounted the bill at 12% p.a. with her bank. Before due date, Rupali

finds herself unable to make payment of the bill; and requests Anjali to renew it. Anjali accepts the proposal on the condition that

Rupali should pay Rs. 5,000 in cash and accept new bill for one month along with interest Rs. 200 for the balance. These

arrangements were carried through. The new bill was met on due date. Give journal entries in the books of Anjali.

53. Vikrant sold goods to the value of Rs. 20,000 to Vishwajeet. Vishwajeet accepted the bill for Rs. 20,000 at three months.

Vikrant discounted the bill at 15% p.a. with his bank. At maturity the bill was returned dishonoured with Rs. 250 as noting

charges.Vishwajeet paid Rs. 10,000 and amount of noting charges and gave Vikrant another bill at three months for the

balance with interests at 1`2% p.a. But before maturity Vishwajeet became insolvent and he paid 75 paise in a rupee from his

estate. Pass Journal entries in the books of Vikrant.

54. Jaya sold goods on credit to Parada for Rs. 8,000. Jaya draws bill on Parada for 3 months for Rs. 8,000 and the same was

accepted by Parada. On due date, the bill was dishonoured, noting charges amounted to Rs. 40 paid by Jaya. .Parada paid half

47


the amount of bill and full amount of noting charges and accepted a new bill for the balance including interest Rs. 200. These

arrangements were carried through. Parada became insolvent and only 50 paise in a rupee could be recovered from her private

estate. Give journal entries in the books of Jaya.

55. Wagh bought goods from Landge for Rs. 12,000 On the same date, Wagh accepted 3 months bill which Landge endorsed to

Kolhe. On the due date, Kolhe informed Landge that the bill was dishonoured and Rs. 50 was paid as noting charges. Landge

then drew a new bill on Wagh including noting charges and interest Rs. 350. Before the due date, Wagh became insolvent and

only Rs. 3,000 was recovered from his private estate as first and final dividend. Give the journal entries in the books of Wagh.

56. Journalise the following transactions in the books of Sonali.

a) Sanjay informs Sonali that Monali’s acceptance for Rs. 16,000 endorsed to Sanjay has been dishonoured. Noting

charges amounted to Rs. 400.

b) Deepali renews her acceptance to Sonali for Rs. 15,000 by paying Rs. 7,000 in cash and accepting fresh bill for the

balance plus interest at 10% p.a. for 3 months.

c) Usha retired her acceptance to Sonali for Rs. 6,000 by paying Rs. 5,800 in cash.

d) Sonali sent a bill of Rupali for Rs., 12,000 to bank for collection. But bank informed that the bill has been dishonoured

by Rupali.

57. Journalise the following transactions in the books of Mr. Ashok Agrawal.

a) The bank informed Mr. Ashok Agrawal that Kamlesh’s acceptance for Rs,. 12,000 sent to bank for collection had been

honoured and bank charges debited were Rs. 60.

b) Discharged Mr. Ashok Agrawal’s acceptance to Mahesh for Rs. 15,250 by endorsing Prakash’s acceptance to Mr.

Ashok Agrawal for Rs. 15,100

c) Vishal renewed his acceptance to Mr. Ashok Agrawal for 11,200 by paying Rs. 6,000 in cash and accepting a fresh bill

for the balance plus interest @ 12% p.a. for three months.

d) Dinesh who had accepted Mr. Ashok Agrawal’s bill of Rs. 14,000 was declared bankrupt and only 45% of the amount

due could be recovered from his estate.

58. Journalise the following transactions in the books of Sharad: a] Prakash informed Sharad that Gopal’s acceptance for Rs. 10,000

endorsed to Prakash has been dishonoured, noting charges amounted to Rs. 200. b] Rajan renews his acceptance to Sharad for

Rs. 5,000 by paying Rs. 2,000 in cash and accepting a fresh bill for the balance plus interest at 8% p.a. for 2 months. c]

Jagdish retired his acceptance to Sharad for Rs. 1,000 by paying Rs. 960 in cash. d] Sharad sent a bill of Shirish for Rs. 8,000

to bank for collection. But bank informed that bill has been dishounored by Shirish.

59. Journalise the following transactions in the books of Maharaja: (1) Ayub informs Maharaja that Sadashiv’s acceptance for Rs.

2,000 endorsed by Maharaja to Ayub has been dishonoured and the noting charges have amounted to Rs. 50. (2) Pankaj renews

his acceptance to Maharaja for Rs. 1,200 by paying Rs. 400 cash and accepting a fresh bill for the balance plus interest at 12%

p.a. for 3 months. (3) Vaibhav’s acceptance to Maharaja for Rs. 6,000 is retired one month before the due date at a discoun t of

12% p.a. (4) The bank informs Maharaja that Kasam’s acceptance for Rs. 2,000 to Maharaja, discounted with the bank earlier

has been dishonoured and the noting charges have amounted to Rs. 40.

60. Journalise the following transactions in the books of M/s. Tirupati:

a) Kailas informed Triupati that Ameet’s acceptance for Rs. 1,000 endorsed to him, has been dishonoured, Noting charges

amounted to Rs. 40/-

b) Vilas renews his acceptance to Tirupati for Rs. 800 by paying Rs. 400 in cash and accepting a fresh bill for the balance

plus interest at 12% p.a. for 3 months.

c) Kalpana’s acceptance to Tirupati for Rs. 6,000 retired one month before due date at a discount for 10% p.a.

d) Bank informs Tirupati the dishonour of Kavita’s acceptance of Rs. 2,500 discounted with bank. Noting charges Rs. 50/-

61. Journalise the following transactions in the books of Rahul:

a) Pradeep informed Rahul that Vijay’s acceptance for Rs. 1,000 endorsed to Pradeep has been dishounoured. Noting

charges amounted to Rs. 50/-

b) Nilesh renews his acceptance to Rahul for Rs. 600 by paying Rs. 200 in cash and accepting a fresh bill for balance plus

interest at 12% for 3 months.

c) Prashant’s acceptance to Rahul for Rs. 3,000 retired one month before due date at a discount of 12% p.a.

PREPARE A BILL OF EXCHANGE FROM THE FOLLOWING DETAILS :

62. a) Drawer : Neeraj Gupta, Neelam Bhavan, Kalyan

b) Drawee : Shobha Kale, Dastur Nagar, Amravati

c) Payee : Nitin Naringrekar, Deogad

d) Period : 90 days

e) Amount : Rs. 7,500/-

f) Date of Bill : 15th March, 2011

g) Accepted on : 20th March ,2011

63. a) Drawer : Hira Sharma, 35, Lakkhani Aprtment, Ulhasnagar

b) Drawee : Neepu Shukla, 23, Prasad Bhawan, Thane (East)

c) Payee : Ajnita, Ambarnath

d) Period : 3 months

e) Amount : Rs. 9,750

48


f) Date of Bill : 15th May2005

g) Accepted on : 20th May, 2005

64. a) Drawer : Shri Narayandas Kela, Gandhi Chauk, Dhanagaon

b) Drawee : Shri Atul Khatke, Mandrup Road, Sholapur

c) Payee : Shri Ranjeet Chavan, Ambajogai

d) Period : 60 days

e) Amount : Rs. 5000/-

f) Date of Bill : 1stMarch, 2009


65. a) Drawer : Rekha, Main road, Jalgaon

b) Drawee : Basanti, Sandesh, Nandura

c) Payee : Uma Chandak, Khangaon


e) Amount : Rs. 2,500/-

f) Date of Bill : 21st January, 2005

g) Accepted on : 25th January 2005

66. a) Drawer : Vijay Bhat, Main road Nagpur

b) Drawee : Ashok Kulkarni, M.G. Road Nagpur

c) Payee : Anil Jadhav, Pune

d) Period : 80 days

e) Amount : Rs. 6,950/-

f) Date of Bill : 7th March, 2006


67. a) Drawer : Namdev Tukaram, Paithan

b) Drawee : Nivruti Sopan, Dehu

c) Payee : Vitthal Pandurang, Pandharpur


e) Amount : Rs. 5,000/-

f) Date of Bill : 17th August, 2005

g) Accepted on : 20th August, 2005

68. a) Drawer : Priti Chavan, Chandika Road, Malvan

b) Drawee : Snehlata Patil, Prashant Nagar, Ambajogai

c) Payee : Archana Ghime, Amravati


e) Amount : Rs. 10,000/-

f) Date of Bill : 1st January, 2006

g) Accepted on : 5th January, 2006

69. a) Drawee : K. Prabhakar, Nehru road, Solapur

b) Drawer : M. Sudhakaran, Shivaji Nagar, Nanded.

c) Period : 3 months

d) Amount : Rs. 4,000/-

e) Date of Bill : 5th February, 2006

f) Accepted on : 9th February, 2006

70. a) Drawer : Nagesh Shah, Shivaji Nagar, Pune.

b) Drawee : Mangesh Mehta, 216, M.G. Road, Mumbai

c) Period : 50 days

d) Amount : Rs. 7,500/-

e) Date of Bill : 20th January, 2006

f) Accepted on : 23rd January, 2006

71. a) Drawer : Vishal Maheshwari, 10 Jathar Peth, Akola

b) Drawee : Vishwas Patel, 5, Ghokhale Path, Thane (W)

c) Period : 3 months

d) Amount : Rs. 5,000/-

e) Date of Bill : 13th March, 2012

f) Accepted on : 16th March 2012

49


COMPANY ACCOUNTS – ISSUE OF SHARES

1) Prerna Public Ltd. was formed with a capital of Rs. 1000000 divided into 10000 shares of Rs. 100 each. Of these 2000 shares were issued to the vendor s fully paid in payment of purchase of building. 6000 shares were offered to the public, and of these 5000 shares were applied and allotted. Rs. 10 was payable on application and Rs. 25 on allotment. The balance was yet to be called. All the money was called up was duly received with the exception of allotment money on 600 shares. Calculate authorized, issued, subscribed, called up and paid up capital and also calls in arrears and uncalled capital.

2) Amba Co. Ltd. invited applications for Rs. 1000 equity shares of Rs. 100 each payable on application Rs. 30, on allotment Rs. 45 and final call of Rs. 25. Applications were received for 1000 shares. All the applications were allotted shares as per their demand. The company received allotment and installment money. Show journal entries in the books of Amba Co. Ltd.

3) Bharucha Co. ltd. issued Rs, 46000 shares of Rs. 100 each payable as follows. Rs. 25 on application, Rs. 35 on allotment Rs. 25 on first call and, Rs. 15 on second call Public applied for Rs. 40000 shares and all applications to allot the shares. All sums due on allotment and calls were received. Journalise the transactions in the books of Bharucha Co. Ltd.

4) Mallya & Co. Ltd. invited applications for 20000 equity shares of Rs. 10 each payable as under:- Rs. 3 on application, Rs. 2 on allotment, Rs. 3 on 1st call, Rs. 2 of second call. Public applied for 25000 shares company rejected 3000 applications and their money was refunded. Money on remaining applications after allotment of 20,000 shares diverted to allotment. All the money on allotment and calls was duly received. Pass journal entries in the books of Mallya & Co. Ltd.

5) Dandekar Co. Ltd. made an issue of Rs. 20000 equity shares of Rs. 20 each payable as follows:- Application: Rs. 5 per share allotment: Rs. 10 per share First call: Rs. 3 per share Second and final call: Rs. 2 per share. The company received applications for Rs. 25000 shares of which application for 5000 shares were rejected and money refunded. All the shareholders paid up to second call except Ravi the allotee of 200 shares failed to pay final call. The expenses of issue amounted to Rs. 3000. Pass journal entries and show balance sheet in the books of Dandekar & Co. Ltd.

6) Johnson & Johnson Co. Ltd. issued 50000 shares of Rs. 20 each, at a discount of 10% payable as follows:- On application: Rs. 5 per share On allotment: Rs. 6 per share (discount Rs. 2) On first call: Rs. 7 per share Applications were received for 75000 shares and the directors made pro-rata allotment to the applicants for 60000 shares. Show the journal of the Johnson & Johnson Co. Ltd. assuming all money received.

7) Quick Deal Co. Ltd. invited applications for 10000 equity shares of Rs. 100 each to be issued at a premium of Rs. 10 payable on allotment. Amount on shares was called as under:- On application: Rs. 20 On allotment: Rs. 40 On first call: Rs. 30 On second call: Rs. 20 All the shares were applied for and allotted. Journalise the transactions, assuming that all sums due were received in the books of Quick Deal Co. Ltd.

8) Goldi & Co. Ltd. issued at par 100000 shares of Rs. 10 each payable Rs. 3 on application, Rs. 4 on allotment, and the balance on the final call. All the shares were fully subscribed and paid except a shareholder Mr. Poor having 1000 shares could not pay the final call. Mr. Poor paid the calls in arrears amount after four months of due date of final call. Company charged interest on the amount received as per Table ‘A’. Pass journal entries to record these transactions assuming that calls in arrears and interest money received from Mr. Poor in the books of Goldi & Co. Ltd.

9) Hinduja Co. Ltd. with an authorized capital of Rs. 400000 divided in to shares of Rs. 100 each, issued for subscription 2000 shares payable at Rs. 25 per share on application, Rs. 30 per share on allotment, Rs. 20 per share on first call and the balance as and when required. Application money on 2000 shares was received and allotment was duly made. Allotment money was received in full. When first call was made one shareholder paid the entire amount on his 50 shares. Show journal of Hinduja Co. Ltd.

10) Games & Co. Ltd. acquired the running business of Mr. Gunthe. The business consisted of assets at Rs. 5000000 and liabilities of Rs. 820000. Equity shares of Rs. 100 each, fully paid, were issued to the vendors in payment of purchase consideration. Pass journal entries in the books of Games &Co. Ltd. when: 1. Shares are issued at par 2. Shares are issued at discount of 5% 3. Shares are issued at a premium of 10%

11) Medhi industries Co. Ltd. issued 15000 equity shares of Rs. 100 each payable as follows:-

On application: Rs. 20 on allotment: Rs. 30 on first call: Rs. 25 on second call: Rs. 25 The company received applications for 12000 shares. All the applications were accepted and shares were allotted. The company made both the calls. One shareholder holding 400 shares failed to pay the final call. His shares were forfeited. Pass journal entries in the books of Medhi Industries Co. Ltd.

12) Tolke Co. Ltd. issued 4000 equity shares of Rs. 10 each at a premium of Rs. 2 per share payable as under: On application: Rs. 2 per share On allotment: Rs. 5 per share (premium Rs. 2) On first call: Rs. 3 per share on second call: Rs. 2 per share Mr. Pankaj was allotted 80 shares. Give necessary journal entry relating to the forfeiture of shares in each of the following alternative cases: CASE I : If Mr. Pankaj failed to pay allotment money and his shares were forfeited.

50


CASE II : If Mr. Pankaj failed to pay allotment money and on his subsequent failure to pay the first call, his shares were forfeited. CASE III : If Mr. Pankaj failed to pay the first call and his subsequent failure to pay the final call, his shares were forfeited.

13) Madhura & Menaka Co. Ltd. issued 1000 equity shares of 10 each at a discount of Rs. 1 share payable as under: On application: Rs. 2 per share On allotment: Rs. 2 per share (with discount adjusted) On first call: Rs. 3 per share On final call: Rs. 2 per share Mr. Pankaj was allotted 20 shares. Give the required journal entry relating to the forfeiture of shares in each of the following cases: CASE I : If Mr. Pankaj failed to pay allotment money and his shares were forfeited. CASE II : If Mr. Pankaj failed to pay allotment money and on his subsequent failure to pay the first call, his shares were forfeited. CASE III : If Mr. Pankaj failed to pay the first call and his subsequent failure to pay the final call, his shares were forfeited.

14) Nande & Co. Ltd. issued 25000 equity shares of 100 each payable as follows:- On application: Rs. 25 On allotment: Rs. 30 On first call: Rs. 25 on second call: Rs. 20 The company received application for 20000 shares. All the applications were accepted and shares were allotted. The directors made both the calls. One shareholder Mr. Dalal holding 200 shares failed to pay the final call. His shares were forfeited and reissued as fully paid up at Rs. 80 per share. Pass journal entries and show balance sheet.

15) Rajendra Industries issued 20000 shares of Rs. 10 each at 10% discount payable Rs. 6 on application and remaining on allotment. Public applied for 32500 shares, shares were allocated on pro-rata to the application of 25000 shares. Money overpaid on application was used for allotment. All the share holders paid the amount except Prerna, the allottee of 4000 shares. Her shares were forfeited. The directors reissued all the forfeited shares for Rs. 35000. Pass the journal entries to record the above transactions in the books of Rajendra industries.

16) Rangoonwala Co. Ltd. forfeited 100 shares of Rs. 100 each (allotment time) on which first call of 30 per share was not yet called up. Give journal entries regarding forfeiture and re-issue of shares in each of the following alternative cases:

i. If 40 of these shares were re-issued as Rs. 80 paid up for Rs. 90 per share. ii. If 40 of these shares were re-issued as Rs. 80 called up for Rs. 80 per share.

iii. If 40 of these shares were re-issued as Rs. 80 paid up for Rs. 70

17) From the following details calculate authorized capital, issued, subscribed, called up and paid up share capital and also calls in arrears and uncalled capital: Pankaj Ltd. was formed with a capital of Rs. 500000 divided in to 5000 shares of Rs. 100 each. Of these 1000 shares were issued to the vendor as fully paid in payment of purchase of machinery. 3000 shares were offered to the public and of these 2500 shares were applied and allotted. Rs. 10 was payable on application and Rs. 25 on allotment. The balance was yet to be called. All the money called up was duly received with the exception of allotment money of 300 shares.

18) The HMT Ltd. issued 15000 equity shares of Rs. 10 each payable as under:- On application: Rs. 3 On allotment: Rs. 2 On first call: Rs. 3 on final call: Rs. 2 All the shares were fully subscribed by the public. All the money due on installments was received. Pass journal entries to record the above transactions in the books of the company.

19) Usha Co. Ltd. issued 12000 equity shares of Rs. 100 each payable as under- Rs. 30 on application Rs. 20 on allotment Rs. 35 on first call Rs. 15 on second call Public applied for Rs. 10000 shares and all the applicants were accepted by the company. Allotment of the shares were made. All the money on allotment, first call and second call were received. Show the journal of the company

20) Geeta Ltd. invited applications for 50000 equity shares of 10 each payable as under- Rs. 3 on application Rs. 2 on allotment Rs. 3 on first call Rs. 2 on final call Public applied for 60000 shares. All the applications were accepted by the company. Money on excess application was used for allotment purpose. Assuming that all the allotment, first call and final call duly received. Pass journal entries in the books of the company.

21) ONGC Ltd. invited applications for 25000 of Rs. 100 each payable as under- On application: Rs. 20 on allotment: Rs. 40 On first call: Rs. 25 on final call: Rs. 15 Public applied for 40000 shares out of which 10000 shares were rejected and money on 5000 shares was diverted to share allotment. All the allotment and calls money was received. Pass journal entries in the journal of ONGC Ltd.

22) The Alfo Ltd. made an issue of 10000 shares of Rs. 20 each payable as under: Application: Rs. 5 Allotment: Rs. 10 First call: Rs. 2 final call: Rs. 3 The company received applications for 15000 shares of which application for 5000 were rejected and money refunded. The director made all calls. One share holders. Holding 100 shares failed to pay first and final call. The expenses of issue amounted to Rs. 5000 Pass journal entries and show the balance sheet.

23) Global IT Ltd. issued 100000 shares of Rs. 10 each at a discount of 10% payable as follows: On application: Rs. 3 On allotment: Rs. 3 (discount) On first call: Rs. 2 On second call: Rs. 1 Public applied for 120000 shares and directors made pro-rata allotment to the applicants. Show the journal of the company assuming that all money received on allotment and calls.

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24) Hindustan Petroleum Ltd. invited application for 40000 equity shares of Rs. 100 each payable as under including 20% premium:

On application: Rs. 30 On allotment: Rs. 40 (including premium) On first call: Rs. 20 On second call: Rs. 30 All the shares were applied for and also allotted. One share holder who was allotted 500 shares failed to pay first and final call. Record the above transactions in the journal of the company.

25) Vijay Ltd. issued 40000 equity shares of Rs. 10 each payable as follows: On application: Rs. 2 On allotment: Rs. 3 On first call: Rs. 3 On second call: Rs. 2 The company received applications for 50000 equity shares. Allotment of shares was made on pro-rata basis. Share allotment and calls were made and as also received except Raja holding 1000 shares failed to pay both the calls. His shares were forfeited after second call. Record the above transactions in books of Vijay Ltd.

26) The Century Ltd. issued 800 shares of Rs. 100 at a premium of 10% payable as under- On application: Rs. 25 On allotment: Rs. 40 (including premium) On first call: Rs. 20 on second call: Rs. 25 Company called up allotment and both the calls which were duly received except Ramesh to whom 500 shares were allotted failed to pay allotment and calls. Prepare journal of Century Ltd.

book-keeping & accountancy - richard's commerce

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