THE INDIAN COMMUNITY SCHOOL, KUWAIT

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THE INDIAN COMMUNITY SCHOOL, KUWAIT SERIES : II TERM /FN/ 2018-2019 CODE :N 055 TIME ALLOWED :3 HOURS NAME OF STUDENT : MAX. MARKS :80 ROLL NO.

1 THE INDIAN COMMUNITY SCHOOL, KUWAIT SERIES : II TERM /FN/ CODE :N 055 TIME ALLOWED :3 HOURS NAME OF STUDENT : MAX. MARKS :80 ROLL NO. :.. CLASS/SEC :.. NO. OF PAGES :7 ACCOUNTANCY ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ General Instructions: 1. Use of calculators is not allowed. 2. Draw neat format wherever required. 3. This question paper contains 23 questions. 4. All parts of the question should be attempted at one place. 1. Givethejournalentryforthetreatmentofpartner sloanappearingontheassetsideof thebalancesheet, ondissolutionofapartnershipfirm. 2. GivetwoitemswhichmayappearonthedebitsideofaPartner scurrentaccount. 3. Ajay,BhawnaandShreyawerepartnerssharingprofitsintheratio2:2:1.OnJuly1, 2017Shreyadied.ThebooksofaccountsareclosedonMarch31every year.salesfor theyear amounted Rs5,00,000andthatfrom1 st Aprilto30 th June2017 werers1,40,000.therateofprofitduringthepastthreeyearshadbeen10%onsales. SinceShreya slegalrepresentativewasheronlyson,whoisspeciallyabled,itwas decidedthattheprofitforthepurposeofsettlingshreya saccountistobecalculated as 20%on sales. CalculateShreya sshareofprofitstillthedateofherdeath. 4. State any rights acquired by a newly admitted partner. 5. Inwhichratio dotheremainingpartnersacquiretheshareof thedeceasedpartner? 6. What is meant by hidden goodwill? 7. Give two circumstances under which the gaining ratio is computed. 8. VinayandNamanarepartnerssharingprofitintheratioof4:1.Theircapitalswere Rs90,000and Rs70,000respectively.TheyadmittedPrateekfor1/3shareintheprofits. PrateekbroughtRs1,00,000ashiscapital.Calculatethevalueof firm s goodwill. 9. Naresh, David and Aslam are partners sharing profits in the ratio of 5:3:7. On April 1 st, 2012, Naresh gave a notice to retire from the firm. David and Aslam decided to share future profits in the ratio of 2:3. The adjusted capital accounts of David and Aslam show a (3)

2 balance of Rs 33,000 and Rs 70,500 respectively. The total amount to be paid to Naresh is Rs 90,500. This amount is to be paid by David and Aslam in such a way that their capitals become proportionate to their new profit sharing ratio. Pass necessary journal entries for the above transactions in the books of the firm. Show the working clearly. 10. Alok, Narendra and Shiv were partners in a firm sharing profits in the ratio of 5:3:2. Goodwill appeared at Rs 90,000 and General Reserve at Rs 50,000 in the books of the firm. Narendra decided to retire from the firm. On the date of his retirement, goodwill of the firm was valued at Rs 2,40,000. The new profit sharing ratio of Alok and Shiv was 2:3. Journalise. 11. Anna and Bobby were partners sharing profits and losses in the ratio 5:3. On 1 st April, 2014, their Capital accounts showed balances of Rs 3,00,000 and Rs 2,00,000 respectively. Calculate the amount of profit to be distributed between the partners if the partnership Deed provided for interest on Capital@ 10%p.a and the firm earned a profit of Rs 45,000 for the year ended 31 st March, A and B are partners sharing profit and loss in the ratio of 3:2. C is admitted for1/5 share. Afterwards D enters for 25 paise in the rupee. Calculate new ratio of A, B, C and D. 13. Passnecessaryjournal entriesonthe dissolutionofapartnershipfirm in the following case: i. Geeta,apartner,was appointedtolookafterthedissolutionwork, for w h ic h shewas alloweda r e mu n e r a t io n of Rs10, 000. Geetaagreed tobear t h e dissolution expenses. Actual d i s s o l u t i o n expensesrs9,500 werepaidbygeeta. ii. Janki,a partner,agreedto lookafterthe d i s s o l u t i o n work fo r acommission ofrs5,000. Jankia g re e d to bear thedissolution expenses. Actual d i s s o l u t i o n e x p e n s e Rs5,500 were paid by Mohan,anotherpartner,onbehalfofJanki. iii. A partner,kavita,agreedtolookafterthedissolutionprocessfor a commissionofrs9,000. She a l s o a g r e e d to bearthe dissolution expenses. Kavitatook over furniture of Rs9,000 for her commission.furniture hada lr ea d ybeen transferredtorealisationaccount. iv. A debtor, Ravinder, forrs19,000agreed topa ythe dissolution expenseswhichwerers18,000infullsettlementofhisdebt. 14. Ashok, B a b u and C h e t a n werepartnersin a firmsharingprofitsin theratioof4: 3: 3.The firmcloses itsbooks on31 st Marchevery ye a r.on 31 st December,2016 Ashokdied. The partnershipdeed providedthatonthe deathofapartnerhisexecutorswillbeentitledforthe following : (i) Balanceinhis capitalaccount.on ,therewas abalanceof Rs90,000inAshok scapitalaccount. (ii) Interestoncapital@12%per annum. (iii) His shareinthe profitsofthe firm inthe yearofhis deathwill be calculatedonthe basisofrateofnet profitonsalesofthe previous year,whichwas 25%.Thesales ofthe firmtill31 st December,2016 werers4,00,000. (iv) His sharein theg o o d w illofthe f ir m.the go o dwillofthefirmon Ashok sdeathwas valuedatrs4,50,000. The partnershipdeed also providedforthe following deductionsfrom the amount (3) (3) (3)

3 payabletotheexecutorofthe deceasedpartner: (i)his drawings inthe yearofh is death. Ashok sdrawings till rs15,000. (ii)intereston 12% pera n n u m whichwas c a lc u l a t e d Rs1,500. The accountant of the firmprepared Ashok s Capital Accountto be presentedto the executorofashok butin a hurryhe leftitincomplete. Ashok scapital Accountas preparedby thefirm saccountantis given below: Ashok scapitalaccount Dr. Cr. Amt Date Particulars Date Particulars AmountRs Rs 2016 Dec31 Dec31 Dec , April1 Dec31 Dec31 Dec31 Dec ,000 8,100 40,000 90,000 90,000 3,18,100 3,18,100 YouarerequiredtocompleteAshok scapitalaccount. 15. E and F were partners in a firm sharing profits in the ratio of 3:1. They admitted G as a new partner on 1 st April, 2018 for 1/3 rd share. It was decided that E, F and G will share future profits equally. G bought Rs 50,000 in cash and machinery worth Rs 70,000 for his share of profit as premium for goodwill. Pass necessary Journal entries in the books of the firm. 16. Asha and Aditi are partners in a firm sharing profits and losses in the ratio 3:2. They admit Raghav as a partner for 1/4 th share in the profits of the firm. Raghav brings Rs 6,00,000 as his capital and his share of goodwill in cash. Goodwill of the firm is to be valued at two years purchase of average profits of the last four years. The profits of the firm during the last four years are given below: Year Profit(Rs) ,50, ,75, ,70, ,45,000 The following additional information is given: i. To cover management cost an annual charge of Rs 56,250 should be made for the purpose of valuation of goodwill. ii. The closing stock for the year ended was overvalued by Rs 15,000. Pass necessary journal entries on Raghav s admission showing the working notes clearly. 17. L and M were partners in a firm sharing profits in the ratio of 2:3. On the firm was dissolved. After transferring assets (other than cash) and outside liabilities to realisation account you are given the following information: a) A creditor of Rs 1, 40,000 accepted building valued at Rs 1,80,000 and paid to the firm Rs 40,000. b) A second creditor for Rs 30,000 accepted machinery valued at Rs 28,000 in full settlement of his claim.

4 c) A third creditor amounting to Rs 70,000 accepted Rs 30,000 in cash and investments of the book value of Rs 45,000 in full settlement of his claim. d) Loss on dissolution was Rs 4,000. Pass necessary journal entries for the above transactions in the books of the firm assuming that all payments were made by cheque. 18. a) Give two reasons in favour of having a Partnership Deed. (6) b) Ajay, Binay and Chetan were partners sharing profits in the ratio of 3:3:2. The Partnership Deed provided for the following: i) Salary of Rs 2000 per quarter to Ajay and Binay. ii) Chetan was entitled to a commission of Rs 8,000. iii) Binay was guaranteed a profit of Rs 50,000 p.a The profit of the firm for the year ended 31 st March, 2015 was Rs 1,50,000 which was distributed among Ajay, Binay and Chetan in the ratio 2:2:1, without taking into consideration the provisions of Partnership Deed. Pass necessary rectifying entry for the above adjustments in the books of the firm. Show the working clearly.[2+4] 19. Priya, Karam and Anna were partners of a firm sharing profits in the ratio 3:2:1. Their Balance Sheet as on March 31 st,2014 was as follows: Liabilities Amount (Rs) Assets Amount (Rs) Bills Payables 1,20,000 Cash in Hand 20,000 Creditors 1,40,000 Debtors 1,40,000 Karam s % 1,00,000 Bills Receivable 70,000 Reserves 1,80,000 Stock 1,70,000 Capitals Investment 1,30,000 Priya 2,00,000 Advertisement suspense a/c 1,20,000 Karam 1,20,000 Building 2,90,000 Anna 80,000 4,00,000 9,40,000 9,40,000 (6) Karam died on June 12, 2014 and according to the Partnership deed his executors were entitled to be paid as under: a) His share in the profits of the firm till the date of his death which will be calculated on the basis of average profit of last three completed years. b) His share in the goodwill of the firm which will be calculated on the basis of two years purchase of total profits of last three years. c) Profits for the last three years were Rs 30,000, Rs 70,000 and Rs 80,000. Prepare Karam s Capital accounts to be rendered to his executors.

5 20. GirijaandGaneshwerepartnersinafirmsharing,profitsandlossesintheratioof 2 : 3. On 31 st March, 2017 their BalanceSheetwas as follows : Liabilities Amount (Rs) Assets Amount (Rs) Creditors 80,000 Cash at Bank 20,000 Bank Overdraft 50,000 Debtors 55,000 Less: Provision 2,000 53,000 Girijas Brothers Loan 77,000 Stock 78,000 Ganesh s Loan 28,000 Investments 89,000 Investment Fluctuation Fund 15,000 Buildings 2,50,000 Capitals Profit & Loss a/c 10,000 Girija 1,50,000 Ganesh 1,00,000 2,50,000 5,00,000 5,00,000 Ontheabovedatethefirmwasdissolved.Theassetswererealizedandtheliabilities were paid offasfollows : a) Debtors of Rs 6,000 were proved bad. b) Girija agreed to pay off her brother s Loan. c) One of the creditors for Rs 10,000 was paid only Rs 3,000 in full settlement of his account. d) Buildings were auctioned for Rs 1, 80,000 and the auctioneer s commission amounted to Rs 8,000. e) Ganesh took over part of stock at Rs 4,000(being 20% less than the book value). Balance of the stock was handed over to the remaining creditors in full settlement of their account. f) Investments realized Rs 9,000 less. g) Realisation expenses amounted to Rs 17,000 and were paid by Ganesh Prepare Realisation Account,Partners Capital Accountsand Bank Account. 21. Parth,RamanandZaishaarepartnersina f ir mmanufacturingfurniture.theyhave beensharingprofitsandlossesintheratioof5: 3:2.From1 st April,2017they decided to share future profitsand losses inthe ratio of 2: 5:3. TheirBalance Sheet showedadebitbalanceofrs4,000inprofit&lossaccount;balanceofrs36,000in GeneralReserveandabalanceofRs12,000inWorkmen scompensationreserve.it wasagreed that (6) (6) i) The goodwillofthe firmbe valued at Rs 76,000. ii) TheStock(book valueofrs40,000) wasto be depreciated by8%. iii) Creditors amountingto Rs900 were not likelyto beclaimed. iv) Claim on accountofworkmen s Compensation amounted to Rs20,000. vestments (book valuers38,000) were revaluedatrs40,000. Pass necessaryjournal entriesfor the above. 22. Kavya, Manyaand Navitawere partners sharing profits as 50%, 30% and 20% respectively. (8)

6 23. OnMarch31, 2016, their BalanceSheet stood asfollows : Balance Sheetof Kavya,Manyaand Navitaas atmarch 31, Liabilities Amount(Rs) Assets Amount(Rs) Creditors 1,40,000 Fixed Assets 8,90,000 General Reserve 1,00,000 Investments 2,00,000 Capitals Stock 1,30,000 Kavya 6,00,000 Debtors 4,00,000 Less: provision 30,000 3,70,000 Manya 5,00,000 Bank 1,50,000 Navita4,00,000 15,00,000 17,40,000 17,40,000 On the above date, Kavyaretired and Manyaand Navitaagreedto continue the business on the following terms: a) Firm s goodwill was valued at Rs 60,000 and it was decided to adjust Kavya s share of goodwill in the capital accounts of continuing partners. b) There was a claim for workmen s compensation to the extent of Rs 4,000. c) Book value of Investments was Rs 13,000 less than the market value. d) Fixed Assets were revalued at 90%. e) Kavya was to be paid Rs 20,000 through a bank draft and the balance was transferred to her loan account which will be paid in two equal annual installments together with 10% p.a. Prepare Revaluation A/c, Partner s Capital A/c s and Kavya s Loan account till it is finally paid. On31 st March2017,theBalanceSheetofAbhirandDivya,whoweresharingprofits in the ratioof3 : 1 was as follows : Liabilities Balance Sheet of Abhir and Divya as on 31 st March 2017 Amount Rs Assets Amount Creditors 2,20,000 Cash at Bank 1,40,000 Employees Provident 1,00,000 Debtors 6,50,000 Fund Less: Provision 50,000 6,00,000 Investment 1,00,000 Stock 3,00,000 Fluctuation Fund General Reseve 1,20,000 Investments(market 5,00,000 value 4,40,000) Capitals Abhir 6,00,000 Divya 4,00,000 10,00,000 15,40,000 15,40,000 They decided to admit Vibhor on April 1, 2017 for 1/5 share in profit. Rs (8)

7 a) Vibhor shall bring Rs 80,000 as his share of goodwill premium. b) Stock was overvalued by Rs 20,000. c) A debtors whose dues of Rs 5,000 were written off as bad debts, paid Rs 4,000 in full settlement. d) Two months Rs 6000 per month was outstanding. e) Vibhor was to bring in Capital to the extent of 1/5 th of the total capital of the new firm. Prepare Revaluation A/c, Partners Capital A/c and the Balance Sheet of the reconstituted firm.

8 INDIAN COMMUNITY SCHOOL KUWAIT MID TERM-2 EXAMINATION SUBJECT: XII ACCOUNTANCY ANSWER KEY Marks: 80 Time: 3 Hrs General Instructions: 1. Use of calculators is not allowed. 2. Draw neat format wherever required. 3. This question paper contains 23 questions. 4. All parts of the question should be attempted at one place Drawings 2. Interest on Drawings 3. Share of loss 3. Shreya s share of profit=1,40,000*20/100*1/5=rs i. Right to share future profit of the firm. ii. Right to share the assets of the firm. 5. The remaining partners will asquire the share of the deceasead partner in gaining ratio. 6. Hidden Goodwill is the excess of desired total capital of the firm over the actual combined capital of all partners. In other words, when the value of goodwill of the firm is not specifically given, the value of goodwill has to be calculated on the basis of the net worth of the firm. 7. i. When a partner retires or dies. ii. When there is a change in the profit sharing ratio.

9 8. 9. (3) [1+1+1(WN)= 3 marks]

10 10. (3) 1 1 ` Profit of Rs 45,000 is not adequate to pay Interest on Capital which is Rs 50,000- Anna Rs 30,000 and Bobby Rs 20,000. Profit of Rs 45,000 will be credited to their respective Capital Accounts in the ratio of appropriations to be made Rs 30,000; Rs 20,000, i.e 3:2. Thus Anna will get Rs 27,000 and Bobby will get Rs 18, Old ratio=3:2 C share 1/5 remaining share=4/5 A s new share=12/25 B s new share=8/25 New ratio=12:8:5 D s share=1/4 remaining share =3/4 A s new share=36/100 B s new share=24/100 C s new share=15/100 New ratio= 36:24:15:25 (3) (3)

11 i. ii. iii. iv i. Cash a/c Dr 50,000 and Machinery a/cdr 70,000 To premium for goodwill a/c 1,20,000. ii. Premium for goodwill a/c Rs 1,20,000 Dr, F s Capital a/c Rs 30,000 Dr

12 16. To E s capital Rs 1,50,000 iii. E,s sacrifice 5/12; F s Gain =1/ (1+1+2=4 marks)

13 ( ) 18. a) 1. In case of any dispute or doubt Partnership deed is a guiding document. 2. It can specify the rights and duties of the partners.(2) b) (6) (2) (2) 19. (6)

14 20. (6) [3+2+1]

15 21. (6)

16 22. (8) (2+4+2 marks)

17 23. (8) (2 +3+3)

Accountancy Class-XII Assignment

Chapter 1 Accounting For fundamentals Accountancy Class-XII Assignment 2017-18 Q1. Lata and Mamta are partners with capital of Rs. 3,00,000 and Rs. 2,00,000 respectively sharing profits as Lata 70% and