THE INDIAN COMMUNITY SCHOOL, KUWAIT SERIES : II MTE / FN/2017-2018 CODE : M 055 TIME ALLOWED : 2 HOURS NAME OF STUDENT : MAX. MARKS : 50 ROLL NO. :.. CLASS/SEC :.. NO. OF PAGES : 5 ACCOUNTANCY ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ 1. A trial Balance is prepared to locate: (a) Errors of Principle (b) Errors of Omission (c) Compensating Errors (d) None of these. [1] 2. Goodwill is a (a) Tangible Assets (b) Fictitious Assets (c) Intangible Assets (d) None of these. [1] 3. From the following ledger balances prepare trial balance. [3] Capital Rs. 1, 21,580, Drawings Rs. 9,520, rent outstanding Rs. 6,420 Goodwill Rs.40, 000, Furniture Rs. 4, Amount due to Amman Rs.29, 000, Amount due from Amir Rs. 60,000, Commission received in advance Rs. 3,000 unexpired insurance Rs.4, 480. 4. From the following information find out the Closing Stock and the Cost of Goods Sold. Rs. [3] Stock in Trade (April 1, 2016) 18,000 Purchases during 2016-17 12, 9 Carriage on Purchases 21,000 Gross profit 3, 00,000 Return Outwards 1 Sales during 2016-2017 14, 50,000 Return Inwards 20,000 Page 1 of 13
5. Rectify the following errors. [4] (i) Rs.5, 000 paid for wages to workmen for making showcases had been charged to the Wages Account. (ii) Rs. 3,500 paid to Mr. Akbar was credited to his Account. (iii) Sales Book was overcast by Rs.2, 000. (iv) The total of one page of the Sales Book was carried forward to the next page as Rs.6, 800 instead of Rs.8, 600. 6. The following balances are extracted from the books of Moon Traders for the year ended 31 st March 2017.Prepare Trading and Profit and Loss Account and Balance Sheet as on that date. [4] Debit Balance Amount Rs. Amount Rs. Purchases & Sales 1,2 2,04,000 Returns 4,000 Machinery 70,000 ----------------- Buildings 60,000 ----------------- Discount 8,000 Provision for doubtful debts ----------------- 2,000 Interest Received ----------------- 1,000 Cash & Bank overdraft 14,000 2 Bad Debts 2,800 ----------------- Sundry Debtors& Creditors 60,000 70,000 Fixtures ----------------- Capital & Drawings 1,00,000 wages 7,200 ----------------- Carriage 3,000 ----------------- Stock on 1-4-2016 50,000 ----------------- Additional Information:- I) Stock on 31 st March, 2017 Rs.45, 000. 4,17,000 4,17,000 7. On Ist, April, 2015, Amal owed Rs. 30, 000 to Suman. On the same day he accepted a bill for the amount at 2 months. Suman got the bill discounted at his bank @15%.Before the due date Amal told Suman that he was not able to pay the full amount and requested Suman to accept Rs. immediately and drew upon him another bill for the remaining amount for 2 months together with interest at 18% p.a. Suman agreed. The second bill was duly met. Give the journal entries in the books of Suman. [4] Page 2 of 13
8. Give Journal Entries for the following adjustments in final accounts:- [4] (i) Salaries Rs. are outstanding. (ii) Insurance Premium amounting to Rs. is paid in advance. (iii) Rs.12,000 for rent have been received in advance. (iv) Commission earned but not received Rs.. 9. Rectify the following errors found in the books of Mr. Abdul Aziz. The trial Balance was out by Rs.9, 860 being excess credit. The difference has been posted to the Suspense Account. (i) Purchase of Office Furniture costing Rs.12, 000 had been passed through the Purchases Book. (ii) An amount of Rs. was received from Ahmed on 31 st March,2017 but had been entered in the Cash Book on 4 th April,2017. (iii) A credit purchase of Rs.6,700 had been posted to the creditors Account as Rs.7,600. (iv) A sale of Rs.20,000 to FM Bros. Was wrongly credited to their account. (v) Rs.1 paid as salary to the Manager Mr. Anwar debited to his personal account. (vi) Total of Returns Inwards Book for March had been cast by Rs.2,000 short. [6] 10. Sameer draws on Suneer three Bills of Exchange for Rs.,Rs.8,000 and Rs.6, 000 respectively for goods sold to him on Ist April, 2017. These bills were for One month, Two months, and Three months respectively. The First Bill was endorsed to his Creditor Sahil. The second bill was discounted with his bank on 4 th April, 2017 @12% p.a. and the third bill was sent to bank for collection on 31 st May, 2017. On the due dates all the bills were duly met by Suneer. The bank sent the collection advice for the third bill after deducting Rs.100 as collection charges. Pass the Journal entries in the books of Sameer and Suneer. [6] 11. Amar owed Rs. to Akbar on Ist January,2017. On Ist February, [6] 2017, Amar accepted a bill for 3 months drawn on him by Akbar for the amount. On the date of maturity the bill was dishonoured by Amar and Noting Charges were Rs.300. Give necessary journal entries in the books of Akbar and Amar under the following situations: (i) When the bill is with Akbar till Maturity. (ii) When the bill has been discounted at 8% p.a. from the bank. (iii) When the bill is endorsed in favour of Anthony in settlement of his claim. Page 3 of 13
12. In the following Trading and Profit and Loss Account for the year ended 31 st March, 2017 and Balance Sheet as on that date, determine the missing Information. [8] Trading and Profit and Loss Account for the year ended 31 st March, 2017 Cr. Particulars Amount Particulars Amount Rs. To Opening Stock To Purchases 54,750 Less:- Purchases Returns 1,250 To Gross Profit Transferred to Profit & loss A\C. To Salaries 33,000 Add:-Outstanding To General Expenses To Taxes & Insurance 12,500 Add: Outstanding taxes 13,700 Less: Prepaid Insurance To Interest 1,180 Add: Outstanding interest On Bank loan 850 To Advertisement To Bad Debts 1,250 Add: Further Bad Debts 1,000 Provision for Doubtful debts (New) 1,850 4,100 Less: Existing Provision 2,000 To Depreciation:- 5% on Building 3,750 10% on Furniture 640 20% on Motor Vehicles 12,500 To Net Profit Transferred to Capital A\c. Rs. 34,600 53,500 == 2,030 4,500 2,100 16,890 By Sales 1,54,500 Less:-sales Returns. 2,000 By Closing Stock 1,52,500 == == == By Gross Profit Transferred from 7,820 Trading A\c. By Commission == 3,750 Less: Received in Advance 2,500 99,400 99,400 Page 4 of 13 Continued on next page
BALANCE SHEET as at 31 st March 2017 Liabilities Amount Rs. Assets Amount Rs. Current Liabilities Current Assets Creditors Cash 6,500 Bank Loan 28,500 Add: Outstanding Interest 850 Outstanding Expenses Outstanding Taxes 1,200 Outstanding salaries 3,000 Commission received in advance Capital Balance 1,2 Add: Net Profit 29,350 4,200 1,250 1,42,360 Debtors Less: Further Bad Debts Less: Provision For Doubtful Debts Insurance Prepaid Closing Stock Fixed Assets Furniture 6,400 Less: Depreciation 35,150 1,000 32,500 Motor Vehicles 62,500 Less: Depreciation Building 7 Less: Depreciation 2,02,160 2,02,160 Page 5 of 13
FORE NOON ACCOUNTANCY (055) MARKING SCHEME CLASS: XI Max. Marks: 50 Date: Time: 2 Hours 1. D [1M] 2. C [1M] 3. TRIAL BALANCE Cr. 3M Particulars Amount Particulars Amount Rs. Rs. Drawings Goodwill Furniture Due from Amir Unexpired Insurance 9,520 40,000 4 60,000 4,480 Capital Rent Outstanding Due to Amman Commission received in Advance 1,21,580 6,420 29,000 3,000 Total 1,60,000 Total 1,60,000 4. (i) TRADING ACCOUNT 2 Marks Cr. Particulars Amount Rs. Particulars Amount Rs. Stock on 1.4.2016 18,000 Sales 14,50,000 Purchases 12,9 Less: Returns 20,000 14, Less: Returns 1 12,80,000 Carriage on Purchases Gross Profit 21,000 3,00,000 Closing Stock (Balancing Figure) 1,89,000 16,19,000 16,19,000 (ii) Cost of Goods Sold =Opening Inventory +Purchases (Net) + Direct Expenses Closing Inventory= 18,000+12, 80,000 +21,000-1,89,000= 11, COGS= 11, 1 Mark 5. Rectified Entries Each Entry 1 Mark Date Particulars LF Debit Amt. Credit Amt. (i) Furniture or Fixtures A\c. = To, Wages A\c == (Being paid for wages to workmen for making showcases had been wrongly charged to the Wages Account now rectified) (ii) (iii) (iv) Akber To, Suspense A\c. (being paid to Mr.Akber was wrongly credited to his Account rectified). Sales A\c. T0, Suspense A\c. (Being sales book overcast now rectified) Suspense A\c. To, Sales A\c. Page 6 of 13 7,000 = 2,000 1,800 == 7,000 = 2,000 = 1,800
(Being sales book undercast now rectified) 6. Trading & Profit & Loss Account for the year ended 31 st March, 2017. Cr. 2M Particulars Amount Rs. Particulars Amount Rs. Opening Stock 50,000 Sales 2,04,000 Purchases 1,2 Less: Returns 4,000 2,00,000 Less: Returns 1,20,000 Closing Stock 4 Wages carriage 7,200 3,000 Gross Profit Transferred to P&L A\c. 64,800 2,4 2,4 Discount Bad Debts Net Profit Transferred to Capital 2,800 Gross Profit Transferred from 68,000 Trading A\c. 64,800 Provision for Doubtful Debts 2,000 Interest Received 1,000 Discount Received 8,000 75,800 75,800 Balance Sheet as on 31 st March,2017 Liabilities Amount Rs. Assets Amount Rs. Current Liabilities Bank Overdraft Sundry Creditors Capital 2 70,000 Current Assets Cash In Hand Sundry Debtors Closing Stock 14,000 60,000 4 Opening Balance 1,00,000 Fixed Assets Add: Net Profit 68,000 1,68,000 Machinery Buildings 70,000 60,000 Less: Drawings 1,58,000 Fixtures 2,54,000 2,54,000 Trading & Profit & Loss A\c 2 ½ Marks Balance Sheet 1 ½ Marks Page 7 of 13
7. Journal Entries in the Books of Mr. Suman (Drawer) ½ mark for each entry Date Particulars Lf Debit Amt. Credit Amt. 2015 Apr. 1 Bills Receivable A\c. To Amal = = (Being the receipt of acceptance to clear the amount April, 1 June 4 June 4 June 4 June 4 Aug 7 due from him) Bank A\c Discounting Charges A\c (Being the discounting of the bill @15% p.a) Amal To Bank A\c. B/R (Being The dishonour (for renewal) of bill) Cash/Bank A\c. To Amal (Being the receipt of Rs.10,00 from Amal) Amal To Interest A\c. (Being the interest due from Amal for 2 months on Rs.20,000 @18% p.a) Bills Receivable A\c. To Amal (Being the new acceptance from Amal for Rs.20,000 plus Rs.600 interest)) Cash/Bank A\c. (Being the amount of bill received) 29,250 750 600 20,600 20,600 = 600 20,600 = 20,600 8. Adjustment Entries one Mark for each entry Date Particulars Lf Debit Amt. Credit Amt. Salaries A\c. == (i) To Outstanding salaries A\c. == ( Being the unpaid amount of salary provided) (ii) Prepaid Insurance A\c To, Insurance A\c. = (Being the expenses relating to next year transferred to prepaid expenses account) (iii) Rent Received A\c (iv) T0 Rent Received in Advance a\c. (Being the rent received in advanced transferred) Accrued Commission A\c. To Commission Earned A\c. (Being the commission earned but not received accounted) 12,000 12,000 = Page 8 of 13
9. Rectified Entries 1 Mark for each entry Date Particulars Lf Debit Amt. Credit Amt. (i) Furniture A\c. 12,000 = To Purchases A\c. 12,000 (Being Purchase of Office Furniture costing passed through the Purchases Book rectified) (ii) (iii) Cash A\c. To Ahmed A\c (Being entry already passed will be reversed on 4th April,2017) == == (iv) (v) (vi) Creditors A\c To Suspense A\c. (Being the mistake in crediting the creditors account more by Rs.900 now corrected) FM Bros. To Anwar A\c. (Being FM Bros. Credited with instead of debited now corrected) Salary A\c. To Suspense A\c. (Being salary paid to Manager Anwar wrongly debited to his personal account now rectified) Returns Inward Book A\c. Or Sales Returns To Suspense A\c. (Being the mistake in totalling the returns Inward Book now rectified) 900 = 40,000 = 1 2,000 = 900 40,000 1 2,000 10. Journal Entries in the Books of Mr. Sameer (Drawer) ½ mark for each entry Date Particulars Lf Debit Amt. Credit Amt. 2017 Apr.1 Suneer To Sales A\c. 24,000 24,000 (Being sold goods to sameer) Apr. 1 Bills Receivable A\c. (No.1 ) Bills Receivable A\c. (No. 2 ) Bills Receivable A\c. (No. 3 ) To Suneer (Being the receipt of acceptances to clear the amount due from him) 8,000 = = = 24,000 Page 9 of 13
Apr.1 Apr.4 May 31 st. Sahil (Being the bill No.1 endorsed in favour of creditor) Bank A\c Discounting Charges A\c (Being the discounting of the bill @12% p.a) Bill Sent for Collection A\c. (Being the Bill Sent to bank for Collection) 7,840 160 = 8,000 June 4 Bank A\c Bank Charges A\c To Bill Sent for Collection A\c. (Being the bill collected by bank and collection charges deducted) 5,900 100 = == == Journal entries in the Books of Drawee (Suneer) Date Particulars Lf Debit Amt. Credit Amt. 2017 Apr.1 Purchases A\c. To Sameer 24,000 = 24,0000 (Being the goods purchased from Sameer) Apr.1 Sameer To Bills Payable (No. 1) A\c. To Bills Payable (No. 2) A\c. To Bills Payable (No. 3) A\c. (Being the acceptances given) 24,000 = = = 8,000 May 4 Bills Payable A\c To Cash Ac. (Being the bill met on Maturity) = June 4 Bills Payable A\c To Cash Ac. (Being the bill met on Maturity) 8,000 = 8,000 July 4 Bills Payable A\c To Cash Ac. (Being the bill met on Maturity) = Page 10 of 13
11. Journal Entries in the books of Akber (Drawer) 1 mark for each entry Date Particulars Lf Debit Amt. Credit Amt. 2017 On receipt of Bill (all three cases) Feb. 1 Bills Receivable A\c. = To Amar = (Being the receipt of acceptance to clear the amount due from him) Feb. 1 Feb. 1 May, 4 Then before Maturity Case (i)-- No Entry Case (ii) Discounting the Bill Bank A\c Discounting Charges A\c (Being the discounting of the bill @8% p.a) Case (iii) Endorsement Anthony (Being the bill endorsed in favour of Anthony) On Maturity, the Dishonour Case (i) Bill held till the Maturity Amar To Cash A\c. (Being The dishonour of bill and noting charges Rs.300 paid) 29,400 600 30,300 = = 300 May,4 Case (ii) Bill discounted with the bank Amar To Bank (Being the discounted bill dishonoured and noting charges) Case (iii) Bill endorsed in favour of Anthony May,4 Amar To Anthony (Being endorsed bill dishonoured and noting charges paid) Books of Amar(Drawee) 2017 JOURNAL Feb 1 Akbar Dr To B/P (i) May 4 B/P A/C Dr Noting Charges A/c Dr 300 To Akbar 30,300 (ii) May 4 B/P A/c Dr Noting Charges A/c Dr 300 To Akbar 30,300 (III) Page 11 of 13 30,300 = 30,300 = === 30,300 === 30,300
May 4 B/P A/c Dr Noting Charges A/c Dr 300 To Akbar 30,300 12. Trading and Profit and Loss Account for the year ended 31 st March, 2017 Cr. Particulars Amount Particulars Amount Rs. To Opening Stock To Purchases 54,750 Less:- Purchases Returns 1,250 To Gross Profit Transferred to Profit & loss A\C. To Salaries 33,000 Add:-Outstanding 3,000 To General Expenses To Taxes & Insurance 12,500 Add: Outstanding taxes 1,200 13,700 Less: Prepaid Insurance 1,000 To Interest 1,180 Add: Outstanding interest On Bank loan 850 To Advertisement To Bad Debts 1,250 Add: Further Bad Debts 1,000 Provision for Doubtful debts (New) 1,850 4,100 Less: Existing Provision 2,000 To Depreciation:- 5% on Building 3,750 10% on Furniture 640 20% on Motor Vehicles 12,500 To Net Profit Transferred to Capital A\c. Rs. 34,600 53,500 96,900 2,030 4,500 2,100 16,890 17,360 By Sales 1,54,500 Less:-sales Returns. 2,000 By Closing Stock 1,52,500 32,500 1,8 1,8 By Gross Profit 3 Transferred from 7,820 Trading A\c. 96,900 By Commission 3,750 12,700 Less: Received in Advance 1,250 2,500 99,400 99,400 Page 12 of 13
Continued on next page BALANCE SHEET as at 31 st March 2017 Liabilities Amount Rs. Assets Amount Rs. Current Liabilities Current Assets Creditors 2 Cash 6,500 Bank Loan Debtors 38,000 28,500 Less: Further Bad Add: Outstanding Debts 1,000 29,350 Interest 37,000 850 Less: Provision 1,850 Outstanding 4,200 For Doubtful Debts 35,150 Expenses Insurance Prepaid 1,000 Outstanding Taxes 1,250 Closing Stock 1,200 32,500 Fixed Assets Outstanding Insurance 3,000 1,42,360 Furniture 6,400 Commission received in Less: Depreciation 5,760 advance 640 Capital Motor Vehicles 62,500 Balance Less: Depreciation 12,500 1,2 Building 7 Add: Net Profit Less: Depreciation 3,750 50,000 71,250 17,360 2,02,160 2,02,160 Page 13 of 13