Asian College of Higher Studies (ACM)
Grade-XII FM:100
Pre-Board question set--I
Subject:- Accounting-II SET-----A PM:40
Time: 3 Hrs
Third Term Exam-2012
Q.1. Give the meaning of public company and mention any two features. 3
Q.2. Distinguish between equity share & Debenture. 2
Q.3. Give the meaning of financial statement analysis. Mention any two objectives. 3
Q.4. Show any two limitations of Ratio analysis. 2
Q.5. Give the meaning of material control. 2
Q.6. Show differences between financial accounting & cost accounting. 3
Q.7. Write in brief the classification of cost on the basis of behavior. 3
Q.8. Give the meaning of absorption of overhead with suitable examples. 2
Q.9. AB co. registered with the share capital of Rs.5,00,000 divided into 5,000 equity shares, issued 4,000 shares for public subscription. The share money was payable as on application Rs.30, on allotment Rs.50(including premium of 10%) and balance on calls. All the shares were subscribed and allotted. All the money was received on due date.
Required:- Journal entries for application & allotment 1+2=3
Q.10. Kathmandu Co issued 50,000 equity shares of Rs.100 each payable at a discount of 5% payable as Rs.30 application, Rs.50 on allotment and balance on first & final call. The applications were received for 75,000 shares and the allotment was made as under:
To the applicants of 5,000 shares--- Nil
To the applicants of 20,000 shares----100%
To the remaining---pro-rata basis
All the calls were made and money was realized excepting from a shareholder who had applied for 5,000 shares allotted on pro-rata basis, failed to pay money due on allotment and calls. Subsequently his shares were forfeited through a resolution of directors.
Required:- Journal entries for allotment, calls & forfeiture 2+2+2=6
Q.11. Brother co. acquired the following business of Sister co. by issuing 5,000 equity shares of Rs.100 at 120%.
Machinery Rs.1,50,000 Creditor Rs.50,000
Debtors 60,000 Unearned income Rs.5,000
Advance Expenses Rs.10,000 15%Loan Rs.1,20,000
Salaries due Rs.20,000 Inventory Rs.15,000
Required:- Journal entries for business purchase 3
Q.12. A commercial bank issued 15% debenture of Rs.30,00,000 at a premium of 10% which was redeemable after two years at a premium of 20%.
Required:- Journal entries for issue & redemption 4
Q.13. The following is the trial balance of a business as on 31st Ashadh, last year.
| Dr balance | Amount Rs. | Cr balance | Amount Rs. |
| Stock Plant & machinery Bills receivable Bad debts Cash & bank Commission & discount Trade debtors Interest on Debenture Goodwill written off Income tax paid Dividend paid Underwriting commission Salaries & allowance Prepaid rent | 20,000 1,00,000 50,000 4,000 1,20,000 6,000 60,000 5,000 10,000 7,500 12,000 50,000 25,000 8,000 | Acceptance Provision for taxation Provision for bad debts Share capital@Rs.100each Gross profit Retained earning 15% Debenture
| 17,000 8,000 1,500 2,50,000 51,000 80,000 70,000
|
|
| 4,77,500 |
| 4,77,500 |
Adjustments:
a) Debenture interest is payable for eight months only. Depreciate machinery by 15% p.a.
b) Authorized capital of the company is divided into 5,000 shares.
c) Rent expired to the extent of Rs.5,000 & commission earned but not received Rs.12,000.
d) Increase provision for bad debts by 4% after writing off bad debts Rs.6,000.
e) The BOD decided to pay dividend @ Rs.5 per share & transferred to General reserve Rs.20,000.
Required:- Profit & Loss account; Profit & Loss appropriation account & Balance sheet 5+2+5=12
Q.14. A business firm gives you the following trial balance.
| Debit balances | Amount Rs. | Credit balance | Amount Rs. |
| Purchase Furniture & Fitting Cash & bank Preliminary exps Interim dividend Salaries & wages Calls in arrears | 60,000 1,80,000 1,20,000 1,40,000 10,000 25,000 15,000 | 15% Loan Share capital Retained earning Sales Commission unearned Provision for tax
| 40,000 2,80,000 50,000 1,50,000 16,000 14,000 |
| Total | 5,50,000 | Total | 5,50,000 |
Additional information:-
a) Stock at close Rs.10,000.
b) Commission earned Rs.5,000.
c) Proposed dividend Rs.12,000.
Required:- Adjusting entries & work sheet(Twelve column) 2+6=8
Q.15. You are given the following information.
Current ratio 2:1 Stock Rs.20,000
Prepaid expenses Rs.5,000 current liabilities Rs.50,000
Share capital Rs.1,40,000 General reserve Rs.20,000
12% Debenture Rs.1,00,000 P/L Account Rs.50,000
Fixed assets turnover ratio 5 times Fixed assets Rs.1,40,000
Net profit before interest & taxes 20% of sales(Tax rate 40%)
Required:- i)Quick Ratio ii) Return on assets iii) Return on shareholders’ equity 1+2+2=5
Q.16. The following information is given.
Net profit during the year Rs.55,000.
Depreciation on machinery Rs.10,000.
Goodwill written off Rs.22,000.
Transfer fee received Rs.15,500.
A part of plant costing Rs.25,000, book value being Rs.15,000 sold for Rs.14,000.
Issue of share Rs.1,30,000
Repayment of loan Rs.70,000.
Required:- i) Funds or Loss from operation ii) Funds flow statement 3+2=5
Q.17. You are given the following information.
Opening Rs. Closing Rs.
Share capital 3,00,000 4,50,000
12% Debenture 1,00,000 ---
Provision for Tax 15,000 20,000
Machinery 50,000 1,20,000
Investment 1,20,000 40,000
Creditors 46,000 60,000
Stock 40,000 30,000
Debtors 25,000 45,000
Bank overdraft 70,000 1,20,000
Other information:
§ Cash Sales Rs.1,20,000 & credit sales Rs.2,30,000.
§ Cost of goods sold Rs.1,20,000, Tax paid Rs.10,000.
§ Operating expenses Rs.80,000 including depreciation of Rs.10,000 & interest Rs.12,000.
§ Investment was sold at a profit of Rs.13,000 & debenture was repaid at 10% premium.
§ Cash & Bank at the beginning of the year Rs.1,20,000.
§ Dividend paid during the year Rs.20,000.
Required:- Cash Flow Statement showing closing cash balance( using direct method) 4+3+3=10
Q,18. A worker produced 600 units of output during a week. The standard wage rate per hour is Rs.120. The standard time allowed for a unit is 10 minutes.
Required:- Total weekly wages applying Time rate system 2
Q.19. A supplier gives you the following information.
Annual requirement 6,00,000 kgs @ Rs.10 each Kg
Cost per order Rs.120
Carrying cost 10% of average inventory
Required:- EOQ & No of orders 2+1=3
Q.20. A storekeeper undergoes the following transactions.
Magh-1, Issued 5,000 units
------10, purchased 2,000 units @ Rs.5 each.
------12, issued 1,200 units
------14, return to store 20 units
-------20, Order received 4,000 units Rs.18,000.
-------30, Shortage found 15 units on physical verification.
There was stock of 6,000 units valued Rs.24,000 at the beginning of the month.
Required:- Store ledger under FIFO 5
Q.21. A manufacturing concern gives you the following information.
Materials stock at the beginning Rs.15,000 & at the end Rs.20,000.
Work-in-progress at the end Rs.25,000.
Units produced 25,000 & Sold during the period 20,000 units
Purchase of materials Rs.1,25,000
Carriage on purchase Rs.12,500
Direct expenses Rs.10,000
Labour cost Rs.40,000
Indirect materials Rs.5,0000
Indirect labour Rs.10,000
Other factory overhead 10% of wages
Income tax paid Rs.12,000
Office overhead 25% of work cost
Selling expenses @ half a rupee per unit
Estimated profit 20% of selling price
Required:- A statement of cost & profit showing elements of Cost 10
Q.22. On reconciliation between cost & financial account, the following facts are brought to notice.
a) Net profit after tax as per Financial records Rs.44,000
b) Opening stock undervalued in cost account Rs.5,500.
c) Closing stock found in excess in Financial account Rs.1,500.
d) Depreciation charged in cost records Rs.10,000 & in P/L account Rs.11,200.
e) Interest on debenture Rs.5,000 & Income from Government bond Rs.6,500 were recorded in financial accounts.
Required:- Cost Reconciliation statement 5
Best of luck
Asian College of Higher Studies(ACM)
Grade-XII FM:100
Subject:- Accounting-II SET-----B PM:40
Time: 3 Hrs
Third Term Exam-2012
Q.1. List the contents of Memorandum of association. 3
Q.2. Distinguish between equity share & preference share. 2
Q.3. Give the meaning of financial statement analysis. Mention any two limitations. 3
Q.4. Briefly explain any two objectives of Ratio analysis. 2
Q.5. Show the advantages of time rate system of wage payment. 2
Q.6. Write down the importance of cost accounting. 3
Q.7. Write in brief the classification of cost on the basis of element. 3
Q.8. Give the meaning of allocation of overhead with suitable examples. 2
Q.9. A public company authorized with the share capital of Rs.10,00,000 divided into 10,000 equity shares, issued 6,000 shares for public subscription. The share money was payable as on application Rs.30, on allotment Rs.50 (after adjusting discount of 10%) and balance on calls. All the shares were subscribed and allotted. All the money was received on due date.
Required:- Journal entries for application & allotment 1+2=3
Q.10. Bagmati Co issued 40,000 equity shares of Rs.100 each payable at a premium of 10% payable as Rs.30 application, Rs.50 on allotment and balance on first & final call. The applications were received for 60,000 shares and the allotment was made as under:
To the applicants of 10,000 shares--- Nil
To the applicants of remaining shares----Pro-rata
All the calls were made and money was realized excepting from a shareholder who had applied for 5,000 shares failed to pay money due on allotment and calls. Subsequently his shares were forfeited through a resolution of directors.
Required:- Journal entries for allotment, calls & forfeiture 2+2+2=6
Q.11.Kantipur co. acquired the following business of Kathmandu co. by issuing 8,000 equity shares of Rs.100.
Fixed assets Rs.5,50,000 Creditor Rs.1,00,000
Debtors Rs. 50,000 Unearned income Rs.35,000
Prepayments Rs.60,000 14% Debenture Rs.1,20,000
Unpaid expenses Rs.25,000 Stock Rs.75,000
Required:- Journal entries for business purchase 3
Q.12. Mero bank Ltd issued 2,000, 16% redeemable debenture of Rs.100 each at a discount of 10% which was repayable at the end of 2nd year at a premium of 15%.
Required:- Journal entries for issue & redemption 4
Q.13. The following is the trial balance of a business as on 31st Chaitra, 2067.
| Dr balance | Amount Rs. | Cr balance | Amount Rs. |
| Inventory Furniture & Fitting Trade debtors Bad debts Cash & bank Miscellaneous expenses Accrued commission Calls in arrears Goodwill Income tax Salaries & wages Preliminary expenses Interim dividend | 40,000 1,40,000 1,00,000 10,000 1,00,000 15,000 20,000 5,000 80,000 15,000 80,000 50,000 25,000 | 13% Mortgaged loan Provision for bad debts Share capital@Rs.100each Gross profit P/L account General reserve
| 1,60,000 5,000 3,00,000 2,50,000 51,000 80,000
|
|
| 6,80,000 |
| 6,80,000 |
Adjustments:
a) Depreciate furniture by 5% p.a. & write preliminary expense off by 1/4th.
b) Authorized capital of the company is divided into 10,000 shares.
c) Rent earned Rs.5,000 but not received yet. Provision for tax for the year Rs.8,000.
d) Increase provision for bad debts from Rs.5,000 to Rs.11,000.
e) The BOD decided to pay dividend @ 5% & increase General reserve to Rs.1,00,000.
Required:- Profit & Loss account; Profit & Loss appropriation account & Balance sheet 5+2+5=12
Q.14. A business firm gives you the following trial balance.
| Debit balances | Amount Rs. | Credit balance | Amount Rs. |
| Purchase Furniture & Fitting Cash & bank Preliminary exps Interim dividend Salaries Calls in arrears | 60,000 1,80,000 1,20,000 1,40,000 10,000 25,000 15,000 | 15% Loan Share capital Retained earning Sales Commission unearned Provision for tax
| 40,000 2,80,000 50,000 1,50,000 16,000 14,000 |
| Total | 5,50,000 | Total | 5,50,000 |
Additional information:-
a) Tax provision for the year Rs.3,500.
b) Salaries prepaid Rs.10,000.
c) Reserve fund created Rs.20,000.
Required:- Adjusting entries & work sheet(Twelve column) 2+6=8
Q.15. You are given the following information.
Equity share capital of Rs.100 each Rs.2,60,000 12% Pref. share capital Rs.1,40,000
General Reserve Rs.50,000 Preliminary expenses Rs.50,000
Retained earning Rs.40,000 15% Debenture Rs.1,00,000
Redemption Reserve Rs.60,000 EBIT Rs.4,00,000 (Tax rate@40%)
Required:- i) Earning after Tax ii) Return on equity shareholder’s fund
iii) Return on capital employed 1+2+2=5
Q.16. The following information is given.
Increase in cash & bank Rs.50,000.
Increase in creditors Rs.40,000
Decrease in debtors Rs.30,000
Decrease in advance income Rs.10,000
A part of plant costing Rs.45,000, book value being Rs.25,000 sold for Rs.20,000.
Issue of share Rs.1,50,000
Loan borrowed from EDB Rs.1,00,000.
Required:- i) Effect on working capital ii) Funds flow statement 2+3=5
Q.17. You are given the following information.
Balance sheets of MSP company
| Liabilities | Last Yr Rs. | This Yr Rs. | Assets | Last Yr. Rs. | This Yr. Rs. |
| Equity share capital Pref. share capital 15% Debenture Reserve P/L account Creditors Bills payable Expenses due Short-term loan Provision for tax | 2,00,000 1,00,000 1,50,000 50,000 1,00,000 1,20,000 50,000 25,000 70,000 12,000 | 3,25,000 50,000 1,00,000 85,000 2,50,000 40,000 1,10,000 40,000 20,000 28,000 | Machinery Investment Debtors Stock Bills receivable Cash & Bank Preliminary exp Accrued income
| 2,00,000 1,77,000 100,000 40,000 30,000 165,000 125,000 40,000
| 3,50,000 60,000 1,70,000 1,71,000 12,000 1,70,000 65,000 50,000 |
| Total | 8,77,000 | 10,48,000 | Total | 8,77,000 | 10,48,000 |
Other information:
§ Sales Rs.5,80,000 during the year
§ Cost of goods sold Rs.1,80,000; Provision for Tax during the year Rs.30,000.
§ Operating expenses Rs.1,20,000 including depreciation of Rs.10,000 & interest Rs.15,000.
§ Investment was sold at a profit of Rs.10,000 & debenture was repaid at 10% premium.
§ Dividend paid during the year Rs.10,000
Required:- Cash Flow Statement using direct method 4+3+3=10
Q,18. A worker worked 250 hours during a month. The standard wage rate per hour is Rs.120. The standard time allowed for a unit is 10 minutes.
Required:- Total weekly wages applying Piece rate system 2
Q.19. A supplier gives you the following information.
Consumption per day 4,000 to 5,000 units
Re-order period 5-10 days
Re-order quantity 45,000 units
Required:- Average stock level 3
Q.20. A storekeeper undergoes the following transactions.
July-1, Issued 5,000 units
------10, Purchased 2,000 units @ Rs.5 each.
------12, Issued 1,200 units
------14, Return to store 20 units
-------20, Order received 4,000 units Rs.18,000.
-------30, Shortage found 20 units on physical verification.
There was stock of 6,000 units valued Rs.24,000 at the beginning of the month.
Required:- Store ledger under LIFO 5
Q.21. A calculator manufacturing concern gives you the following information.
The concern is going to produce and sell 10,000 calculators next year and desiring to quote the price. The following estimations have been made for this purpose.
Material & labour cost will go up by 10%.
Other direct expenses will not be affected.
Profit 25% of cost
The past records of the concern for the production of 5,000 calculators are as follows.
Materials Rs.4,00,000 Wages Rs.2,00,000; Other direct expenses Rs.1,00,000
Factory overhead Rs.2,50,000; Office salaries Rs.80,000 & General charges Rs.20,000
Selling & distribution charges 20%
Required:- Price to be quoted showing amount of profit 10
Q.22. On reconciliation between cost & financial account, the following facts are brought to notice.
§ Net Loss as per Financial records Rs.40,000
§ Opening stock undervalued in cost account Rs.9,500.
§ Closing stock found in excess in Financial account Rs.4,500.
§ Depreciation charged in cost records Rs.25,000 & in P/L account Rs.45,000.
§ Interest on debenture Rs.7,000 & Income from Government bond Rs.8,500 were recorded in financial accounts.
Required:- Cost Reconciliation statement 5
Best of luck
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