ITL PUBLIC SCHOOL HOLIDAY HOME WORK CLASS XII- ACCOUNTANCY I. Prepare a comprehensive project on any sole proprietorship or partnership firm for its entire year s financial transactions. The following steps of accounting cycle should be presented: (i) Journal (ii) Ledger (iii)trial balance (iv) Trading and Profit and Loss Account (v) Balance Sheet II. Collect financial information of any two companies (except banking and insurance companies) including financial results, statement of assets & liabilities and segment wise results from newspaper. B PRACTICE ASSIGNMENT 1. Name the method of calculating interest on drawings of the partners if different amounts are withdrawn on different dates. 2. Can a partner be exempted from sharing losses in a firm? If yes, under what circumstances? 3. A, B and C were partners having capitals of 60,000 ; 60,000 and 80,000 respectively. Their current account balances were A : ; B : 5,000 and C : 2,000 (Dr.). According to the Partnership Deed, the partners were entitled to interest on capital @ 5%p.a. C being the working capital was also entitled to a salary of 6,000 p.a. The profits were to be divided as : (i) The first in proportion to their capitals (ii) Next in the ratio of 5 : 3 : 2. (iii) Remaining profits to be shared equally. The firm made a profit of 1,56,000 before charging any of the above terms. Prepare Profit and Loss Appropriation Account and pass necessary Journal entry for appropriation of profit. 4. (a) A, B and C entered into a partnership on 1 st October, 2004 to share profits and losses in the ratio of 3 : 2 : 1. A however, personally guaranteed that C s share of profit after charging interest on capital @ 5% p.a. would not be less than in any year. The capital contributions were A- 3,00,000 ; B- 3,00,000 ; and C- 1,00,000. The profits for the period ended 31 st March, 2005 were 1,. Show distribution of profits. (b) On 31 st March, 2005 after the closing of books of accounts, the Capital Accounts of A, B and C stood at 24,000 ; and 12,000 respectively. The profit for the year 36,000 was distributed equally. Subsequently, it was discovered that interest on capital 5% had been omitted. The profit sharing ratio was 2 : 2 :1. Pass an adjustment Journal entry. 5. A and B were the partners sharing profits and losses in the ratio of 3:2. They admitted C into partnership. C purchased 1/5 th share in profits of the firm from A for Rs. Afterwards B retired from the firm. Calculate B s share in goodwill to be given to him at the time of retirement. 6. A and B were the partners sharing profits and losses in the ratio of 5:3. C was admitted into partnership. C brought Rs5,00,000 as capital and his share of goodwill premium in cash. It was agreed between the partners that C s capital would be 25% of the capital of the new firm. After all adjustments regarding general reserve, goodwill, gain or loss on revaluation, the balances in capital accounts of A and B were Rs3,95,000 and Rs5,05,000 respectively. Calculate the amount of goodwill premium brought by C. 7. Calculate the amount of interest on drawings @ 10 % p.a. if X, a partner, withdrew Rs2,400 in the beginning of each month throughout the year. 8. Arjun, a partner in a firm, demanded interest @ 6% p.a. on the loan advanced by him to the firm. Other partners did not agree with him and wanted to give him interest @ 5% p.a. as mentioned in the partnership deed. Who is correct and why?
9. X and Y were partners sharing profits and losses in the ratio of 3:1. They admitted Z into partnership for ¼th share in profits. X and Y decided to keep the profit sharing ratio equal between themselves. Find out the new profit sharing ratio. 10. Komal, Chanchal and Sheetal were partners sharing profits and losses in the ratio of 5:2:3. They distributed profits for two years in ratio of their capitals which were fixed at Rs 5,00,000; Rs 3,00,000 and Rs 2,00,000 respectively. It was later found that the interest on capital @ 10% p.a provided in the partnership deed, had been omitted. Profits were as follows: 2013-14: Rs 2 (before debiting manager s commission Rs ) 2014-15: Rs 3,00,000 (after debiting manager s commission Rs ) Give the necessary adjustment entry. 11. P and Q were partners in a firm sharing profits in 4:1 ratio. R was admitted as a new partner for 1/4th share in the profits on April 1, 2015. Capital of the new firm was fixed at Rs 5,00,000 to be maintained by partners in their profit sharing ratio. Surplus or deficit to be adjusted through cash. R agreed to bring necessary cash for capital. Balance Sheet of the firm on March 31, 2015 Liabilities Rs Assets Rs Creditors Bills Payable Goodwill Bank Reserve fund Debtors 25,000 Employees Provident fund Workmen compensation fund Less: Provision (5,000) Capitals: P 1, 2,00,000 Inventory Furniture Q 80,000 Plant and machinery The terms of agreement on R s admission were as follows: a) R brought her share of goodwill in cash. Goodwill was valued at thrice its book value. b) Plant and machinery was undervalued by Rs 1,. c) Provision for doubtful debts to be raised to Rs 8,000. d). There was a claim by a worker for compensation Rs 25,000. Prepare 1)Revaluation Account 2) Partners Capital Account 3)Balance Sheet of P, Q and R. 12. X, Y and Z were partners sharing profits in the ratio of 5:4:1. On 31 st March 2015, Z retired. On this date balance sheet stood as follows: Balance Sheet Additional information: 1. Goodwill was valued at Rs. 2. Depreciate furniture @ 5%, plant & machinery and building by 10%. 3. Provision for bad debts to be maintained @ 10% on debtors. 4. Z took away inventory for Rs at Rs 60,000 for cash. 1,90,000 3,00,000 3,00,000 Liabilities Rs Assets Rs Bank loan Bills Payable 1,00,000 Goodwill Bank General reserve 60,000 Debtors 85,000 Employees Provident fund Workmen compensation fund Less: Provision (4,000) Capitals: Inventory X 5, Furniture Y 2, Plant and machinery Z 2,00,000 10,00,000 Building 1, 81,000 1,39,000 1, 2,00,000 6,00,000 12,80,000 12,80,000
5. There was a claim by a worker for compensation for Rs. However, it was decided to show workmen compensation amount at its original figure. Prepare revaluation account, partners capital accounts. 13. A partner introduced additional capital of and advanced a loan of to the firm at the beginning of the year. How much year s interest will the partner recover? 14. When is a partner liable for debts incurred by the firm after his retirement? 15. Sita and Gita are partners in a firm. On 1-4-2011 the capitals of the partners were: Sita- Rs.1,00,000 and Gita- Rs.80,000.the net profit of the firm for the year ended on 31 st March 2012was Rs. 3,. You are required to prepare profit and loss appropriation account by taking into consideration the under mentioned information. a) Interest on partner s drawings @ 6%p.a b) Loan from Gita- Rs. 90,000, interest on loan to be charged for the whole year. c) Interest on capital@ 5%p.a d) The drawings were:sita-rs.and Gita- Rs. The profits to be divided: Sita-72%, Gita18% and 10% carried to reserve fund of the firm. 16. Diya and Priya are partners in a firm sharing profits and losses in the ratio of 7:3. Their Balance Sheet as at 31 st March, 2012 is as follows: Liabilities Amount Assets Amount Creditors 1, Cash in Hand 72,000 Reserve Cash at Bank 1,80,000 Capital Accounts: Debtors 88,000 Diya- 1,00,000 Stock 1,00,000 Priya- 80,000 3,60,000 Furniture 60,000 5,00,000 5,00,000 On 1 st April 2012, they admit Nitya on the following terms: Stock is to be reduced by 30% and furniture is to be reduced to 30%. Goodwill is valued at 80,000 and Nitya is to bring in the necessary amount in cash as premium for goodwill and 1, as capital for ¼ share in profits. Capitals of the partners shall be proportionate to their profit sharing ratio taking Nitya s capital as base adjustments of capitals to be made by cash. Prepare revaluation a/c, Partner s capital a/c s and cash account. 17. Give the Journal entry to distribute Investment Fluctuation Reserve of Rs. at the time of admission of Sachin, when Investment (market value Rs. 1,90,000) appears at Rs. 2,00,000. The firm has two partners Sunil and Dilip. 18. Average Profit is Rs. 6,00,000, Capital Employed is Rs. 20,00,000, Normal Rate of Return is 15%.. Calculate the value of Goodwill on the basis of Capitalisation of Super Profit. 19. A,B,C and D were partners sharing profits in the ratio of 3:3:2:2. On 1 st April, 2015 D retired owing to ill health. It was decided by A,B,and C that in future their profit sharing ratio would be 3:2:1. Goodwill of the firm is valued at Rs. 6,00,000. Goodwill already appeared in the balance sheet at Rs.. Complete the following Journal entries in this regard: DATE PARTICULARS L.F Dr.(Rs.) Cr.(Rs.) 2015 April 1 A s Capital A/c B s Capital A/c C s Capital A/c D s Capital A/c To. (Being existing Goodwill written off).....
A s Capital A/c B s Capital A/c To C s Capital A/c To D s Capital A/c (Being adjustment for goodwill made on retirement of D).... 20. The Balance Sheet of X, Y and Z were sharing profits in the ratio of 5:3:2 as at 31 st March, 2015 LIABILITIES Rs. ASSETS Rs. Creditors Employees provident fund Workmen compensation reserve Profit and loss A/c X s Capital A/c Y s Capital A/c Z s Capital A/c 85,000 62,000 33,000 3, Cash at bank Debtors Stock Fixed assets Goodwill 1,00,000 80,000 60,000 3, X retired on the same day on the following terms: (a) Goodwill of the firm is to be valued at Rs. 80,000 and X s share of the same be adjusted to that of Y and Z who are going to share the future profits in the ratio of 2:3. (b) Fixed assets are to be depreciated to Rs. 57,500. (c) Make a provision for Doubtful Debts at 5% on Debtors. (d) A liability for claim,included in creditors for Rs. is settled at Rs. 8,000. (e). X decided to donate 50% of his share to a school. Prepare Revaluation Account, Partner s Capital Accounts and the Balance Sheet of the new firm. Also identify the value being highlighted in this case. 21. The Balance Sheet of Madan and Mohan, who share profits and losses in the ratio of 3:2 on 31 st March 2015 was as follows: LIABILITIES Rs. ASSETS Rs. Creditors Workmen Compensation Reserve General Reserve Capital A/cs: Madan Mohan 28,000 12,000 60,000 Cash at Bank Debtors 65,000 Less: provision for doubtful debt 5,000 Stock Investments Patents 60,000 1,60,000 1,60,000 They decided to admit Gopal, a differently abled person, on 1 st April 2015 for 1/4 th share on the following terms: (i) Gopal shall bring Rs. as his share of premium for Goodwill. (ii) That unaccounted accrued income of Rs. 1,000 be provide for. (iii) The market value of investments was Rs. 45,000. (iv) A debtor whose dues of Rs. 5,000 were written off as bad debts paid Rs. 4,000in full settlement. (v) A claim of Rs. 3,000 on account of workmen compensation to be provided for. (vi) Patents were overvalued by Rs. 2,000.
(vii) Gopal to bring in capital equal to 1/4 th of the total capital of the new firm after all adjustments. Prepare Revaluation Account, Partner s Capital Accounts and the Balance Sheet of the new firm. Also identify the value being highlighted in this case. 22. Distinguish between Receipts and Payments account and Income and Expenditure account on the basis of nature of items recorded therein. 23. How will you deal with following items while preparing the final accounts of a club for the year ending 31 st March 2014? Stock of stationery Rs. 4,000(on 1.4.13) and Rs. 3,000(on 31.3.14) Creditors for stationery Rs.7,200(on 1.4.13) and Rs. 5,400(on 31.3.14) Amount paid for stationery during the year 2013-14 Rs.25,000. 24. How will you deal with following items while preparing the final accounts of a club for the year ending 31 st March 2014? Stock of stationery Rs. 4,000(on 1.4.13) and Rs. 3,000(on 31.3.14) Creditors for stationery Rs.7,200(on 1.4.13) and Rs. 5,400(on 31.3.14) Amount paid for stationery during the year 2013-14 Rs.25,000. 25. Following is the Receipts and Payment account of Rajdhani Club for the year ended 31 st Dec. 2014: Receipts Amt Payments Amt To balance b/d By salary 15,000 To subscription 52,000 By office expenses 6,000 To entrance fees 5,000 By Tournament expenses 31,000 To Tournament fund 26,000 By Insurance 2,000 To sale of old newspaper To legacy To donations To new year s party collection To furniture sold(book value Rs.2,000) 1,000 By expenses for new year s 1,200 party 37,000 By sports equipment purchased 9,000 By 12% investments purchased(on 1 st Sept 14) 1,500 By balance c/d 18,100 1,800 1,43,300 1,43,300 Other information: (i) Salary outstanding on 31.12.14 is Rs. Rs.1,500. Also salary outstanding on 31.12.13 is Rs.1,000. (ii) On 1.1.14 the club had building Rs.75,000 and sports equipment Rs.. Depreciation charged on these items including purchases was 10%. (iii) 20% of the entrance fees is to be capitalized. (iv) The club has 1000 members each paying Rs.55 as subscription for the entire year. Prepare Income and Expenditure account of the club for the year ended 31.12.14 also Balance Sheet as on that date. 26. How will you deal with the following while preparing income and expenditure account April 1, 2011 April 1, 2012 Stock of medicine 2,200 5,800
Creditors for Sports Material 7,800 9,200 Advances to suppliers for sports material 5,000 5,000 Payment to suppliers for sports material 27. From the following Receipts and payment account of Sharda Yoga Club, Bhopal, prepare the Income And Expenditure Account for the year ended on 31 st March, 2010 and Balance Sheet as on that date : Receipts Rs. Payments Rs. To Cash 500 By Salaries 24,000 To cash at Bank 5650 By Rent 7,200 To Subscription By Postage 300 (including Rs 1000 for 2008-2009 and Rs 1500 for 2010-2011) 45500 To interest on By Priniting & 2550 investment Stationary To bank Interest 250 By Electric Charges 3000 To Sale of 3000 By Meeting Expenses 1500 Furniture(Book value 2,500) By Purchases of Library books By investments in bonds By Cash in hand 1550 By Cash at Bank 14800 74,900 74,990 Additional information: i) On 1.4.2009,the club had theb following assets and liabilities a) Investments Rs 4,00,000 b) Furniture c)library books Rs, Liability for rent Rs 600 & Salaries Rs 2,000 ii) On 31.3.2010 Rent Rs 600 & Salaries 2,000 were in arrears. 28. From the following information calculate the amount of subscription to be credited to the Income & Expenditure account for the year ended 2013-14 Subscription received during the year Rs. 80,000 Subscription outstanding on 31.12.13 Rs.26,000 Subscription outstanding on 31.12.14 Rs.6,000 Subscription received in advance on 31.12.13 Rs.15,000 Subscription received in advance on 31.12.14 Rs. Subscription of Rs.2,000 are still in arrears for the year 2012-13.