M.com. (Semester (CBCS) Examination, 2017
ADVANCED ACCOUNTANCY-I
Day Date: Tuesday, 25-04-2017 Max. Marks: 70
Time: 10.30 AM to 01.00 PM
N.B.: Q.1 andQ.7 are compulsory.
Figures to the right indicate full marks.
Q.1 Choose the correct alternatives: 14
Repairs to machinery is apportioned over different departments
according to
No. of machines in each department
Value of machines
Floor area occupied by each machine
None of the above
Royalty payable is debited by lessee
Royalty a/c Landlord a/c
P&L a/c Short working a/c
In marine insurance percentage of premium
income is carried forward as provision for and the balance is
transferred to profit and loss account.
100% 50% 25% 10%
is primarily a management tool that informs the
management about the changes that are taking place in the
human resource of an organization.
Labor turnover ratio Human resource accounting
Attendance sheet Labor history card
In case the right to recoup short working has expired the
balance in the short working account is transferred
Landlord a/c P&L a/c
Royalty a/c None of the above
Cash received on contract is credited
Work in process Contract a/c
Contractee a/c Cost a/c
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SLR-QA 04
accounting provides useful information to the
management about direct recruitment and promotion; transfer
and retention, retrenchment etc.
Labor cost Human resource
Recruitment All of the above
The minimum rent or royalty whichever is to be paid by the
lessee landlord
Sub-lessee None of these
If the rate of gross profit of department X is 25% of cost the
amount of gross profit on a turnover of Rs.10000 will be
Rs.25000 Rs.20000 Rs.33333 Rs.22000
10)Life insurance has an element both of protection and
Premium Safety Investment Risk
Costs are incurred to identify the possible sources of
employees.
Recruitment Selection
Hiring and department Orientation
12) Non-department items of expenses are charged to
Departments on the basis of sales
General P&L a/c
Departments on the basis of fixed assets
None of the above
13) The degree of completion of work is determine by comparing the
work certified with
Contract price Work-in-progress
Cash received on contract Contract account
14)Legal fees in respect of claim is shown in
Revenue a/c Profit Loss a/c
P&L appropriation a/c Balance sheet
Q.2 Answer the following 14
Write a note on minimum Rent and Short working.
Write a note on Human Resource Accounting.
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Q.3 14
The following are the expenses on a contract which commences on 1st Jan.
2016
Particulars Rs.
Materials purchased 1,00,000
Materials on hand 5,000
Direct wages 1,50,000
Plant issued 50,000
Direct expenses 80,000
The contract price was Rs.15, 00,000 and the same was duly
received when the contract was completed in August 2016. You are
required to change indirect expenses at 15% on wages and provide
Rs.10.000 for depreciation on plant.
Prepare the contract account and the contractee's account.
On 31/3/2016 the books of Maharashtra Fire General Insurance
Co. Ltd. Contained the following balances in respect of the
business.
Particulars Rs.
Reserve for unexpired risk 3,50,000
Estimated liability in respect of
outstanding claims-
On 31/3/2015 43,500
On 31/3/2016 76,000
Claims paid 3,95,000
Premiums 7,00,000
Interest Dividends 31,000
Commission 1,25,000
Profit on sale of securities 3,500
Management expenses 2,25,000
Re-insurance recoveries 10,000
Prepare the Fire Revenue Account reserving for unexpired risk
40% of premiums and treating the surplus as additional reserve.
Fire insurance premium Rs.7, 00,000 is after receipt of Rs.20,000
and payment of Rs.30,000 as re-insurance premiums. An
adjustment in respect of commission at 15% on such premiums is
still to be made.
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SLR-QA 04
Q.4 Any one 14
Ajay Ltd. Leased a colliery on 1st January from M/s Sathe at a
minimum rent of Rs.40000 p.a. at a Royalty of Rs.3 per ton with a
right to recover short working over the first three years of the lease.
The output for the first years of the lease was as follows-
Year Output (tons)
2010 10000
2011 12000
2012 14000
2013 20000
You are required to-
1. Prepare a statement of working
2. Show necessary journal entries in the books of Ajay Ltd. For
four years.
From the following trial balance prepare departmental trading and
profit and loss account for the year ending 31st March 2016 and the
balance sheet as at that date.
Particulars Rs.(in

Rent, rates and taxes 939
Sundry expenses 360
Salary 300
Lighting and heating 210
Discount allowed 222
Discount received 65
Advertising 368
Carriage inward 234
Furniture 300
Machinery 2100
Debtors 606
Creditors 1860
Capital account 4766
Drawings 450
Cash at bank 1007
Dept. A
Rs.(in'000)
Dept. B
Rs.(in'000)
Stock 1/4/2015 1700 1450
Purchase 3540 3020
Sales 6080 5125
Wages 820 270
The following information is available-
Internal transfer of goods from dept. A to B Rs.42000
Rent rates and taxes; sundry expenses, lighting and heating,
salaries and carriage are to apportioned 2/3 to dept. A and
1/3 to dept. B.
Advertising is to be apportioned equally.
Discount allowed and received are to be apportioned on the
basis of sales and purchases (excluding transfers).
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SLR-QA 04
¾to dept. A and ¼ to dept. B.
Service rendered by dept. B to dept. A are included in its
wages Rs.50000.
Stock on 31/3/2016 in dept. A Rs.167400 and in dept. B
Rs.1205000.
Q.5 Any one 14
The following figures are taken from the books of life Assurance
Corporation for the year ended 31st March 2016. Write up the
Revenue account and the Balance Sheet.
Particulars Rs. Rs.
Claims by death (paid) 3,38,000
Claims by maturity (paid) 2,20,000
Premiums received-
Single premiums 2,10,650
New premiums 8,00,000
Renewal business 12,00,000
Bonus paid in cash 1,000
Bonus in reduction of
premium
2,000
Agents allowances 28,000
Salaries 45,000
Travelling expenses 2,500
Directors fees 8,700
Auditors fees 2,500
Medical fees 40,000
Commission 2,10,000
Income tax on interest
and dividend
4,750
Law charges 500
Advertising expenses 4,3000
Printing and stationary 12,200
Postage and telegrams 2,100
General expenses 1,800
Surrenders 35,000
Re-assurance premium 30,000
Interest and dividends 2,70,000
Policy renewal fees 1,700
Life assurance fund

26,85,000
Share capital (5000
shares of Rs.100 each)
5,00,000
Investments 42,00,000
Furniture and fixtures 10,000
Agents balances 40,000
Cash at bank 15,000
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Loan on corporation
policies
55,000
Annuities 30,000
Consideration for
annuities granted
75,000
Unpaid dividend 12,000
Investment fluctuation
fund
5,70,000
Mortgage on freehold
property
10,00,000
Creditors 17,500
Cash in hand 3,500
63,41,850 63,41,850
The following adjustments are to be made-
1. Outstanding premium Rs.21,000
2. Commission due to agents Rs.8,000
3. Allowance due to agents Rs.1,700
4. Depreciate furniture and fixtures by
5. Provide Rs.20,000 for investment fluctuation fund
6. Claims outstanding- by death Rs.15,000 and by maturity
Rs.12,000
7. Interest outstanding Rs.21,000
OR
The following information relates to a contract for Rs.75, 00, 000
(the contractee paying 90% of the value of the work done as
certified by the architect).
Particulars 1st years 2nd years 3rd years
Materials 9,00,000 11,00,000 6,30,000
Wages 8,50,000 11,50,000 8,50,000
Direct expenses 35,000 1,25,000 45,000
Indirect expenses 15,000 20,000
Work certified 17,50,000 56,50,000 75,00,000
Work in progress
uncertified
1,00,000
Plant issued 1,00,000
Plant was valued at the end of the first year, the second year and
the third year at Rs.80,000, Rs.50,000 and Rs.20,000 respectively.
Prepare the contract account for all the three years.