DISTANCE EDUCATION
B.Com (CA)/B.Com (lateral). DEGREE EXAMINATION,
MAY 2016.
ADVANCED ACCOUNTING
Time Three hours Maximum 100 marks
PART A — × 8 40 marks)
Answer any FIVE questions.
1. Distinguish between accounting concepts and accounting
conventions.
2. When can a company change its accounting policy?
3. A Ltd purchased Building for Rs. 100,000 From B ltd. it
issued shares of Rs. 10 each fully paid up in satisfaction
of their claim. Make the Journal entries to record these
transactions.
4. What is meant by use of application money?
5. Write short notes on;
Independent Branch
Foreign Branch
6. Balance sheet of Z ltd and A ltd as on 30th September
given below.
Liabilities Z
Rs
A
Rs
Assets Z
Rs
A
Rs
Equity share
capital
(Rs. 10) each
2,00,000 4,00,000 Sundry Assets 3,10,000 6,00,000
Reserves and
surplus
40,000 Loan to A Ltd 30,000
Sub. Code
31
DE-3309
2
Liabilities Z
Rs
A
Rs
Assets Z
Rs
A
Rs

Debentures
1,00,000 Investments:
Loan from Z
Ltd
30,000 5000 shares of A
Ltd
50,000
Sundry
creditors
50,000 70,000
3,90,000 6,00,000 3,90,000 6,00,000
A ltd proposes to take over Z ltd on the following terms:
A ltd will issue sufficient number of its shares
Rs. 11 each and 0.50 paise cash per share held by
members of Z ltd.
debentures of Z ltd are to be paid at percent
premium by issue of sufficient number of 10%
debentures of A ltd Rs.90.
Assuming that takeover has been completed, show the
journal entries in the books of both the companies and
draft Balance sheet in the books of A Ltd.
7. Redemption of 20000 preference shares of Rs. 100 each
was carried out of reserves and out of the issue of 4000
shares of Rs. 100 each @Rs. 95 what is amount of capital
redemption reserve account that is required.
8. You are required to calculate the time ratio for the pre
and post incorporations period from the following
particulars.
Data of incorporation Ist June 2013
Period of financial accounts April 2012 to March
2014.
Total wages Rs.6000
Number of workers pre incorporation period 5 post
incorporation period 25.
DE-3309
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PART B — × 15 60 marks)
Answer any FOUR questions.
9. What is hire purchase? Distinction between hire purchase
system and installment system.
10. Explain briefly:
Reserve for service
Stock and Debtors method.
11. Given below are the balance sheets as on March 31, 2013
of Alpha ltd, And Beta ltd which are amalgamated to
form a new company Gamma ltd;
Balance Sheet
Liabilities Alpha
Amount
Beta
Amount
Assets Alpha
Amount
Beta
amount
Share capital:
In insurance of
Rs. 100 each fully
paid
1,00,000 2,00,000 Good will 40,000
Reserve and
surplus: Capital
reserve
50,000 10,000 Building 30,000 25,000
General reserve 10,000 Plant 60,000 80,000
Profit and loss A/c 40,000 Furniture 5,000 10,000
Loans 80,000 60,000 Current
assets; Stock
1,00,000 1,40,000
Other liabilities 20,000 80,000 Debtors 1,04,000 13,000
Cash 1,000 2,000
P&L A/c 40,000
3,00,000 3,50,000 3,00,000 3,50,000
The share holder in amalgamating companies are to be
allotted fully paid equity shares in gamma ltd, for the
amount of purchase consideration for which purpose all
assets and liabilities are to be taken at book ltd. which is
considered worth less. Show the opening balance sheet of
the new company
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12. The balance sheet in profit and loss account as per
balance sheet at 3lst march 2013 is Rs. 19050/-
The following information is available
Rs .5000 depreciation has been charged.
Provision for dividend amounting to Rs.6750 has
been made
Rs. 2150 has been transfer to general reserve
Rs.600 dividend (gross) has been credited
Rs. 1150, loss on sale of fixed assets has been
debited
Indirect expenses debited, amount 15250 find out
gross profit, trading profit and net profit.
13. Point out the different between the hire purchase system
and installment purchase from:
The legal point of view and
The accounting point of view
14. Distinction between internal reconstruction and external
reconstruction
15. Madras credit Sales Corporation has a hire purchase
department. Goods are sale on hire purchase at cost plus
25% from the following particulars prepare the ledger
account by stock and deposit method
Rs.
Stock with hire purchase customers at selling price
01.04.2012
25,000
Installment due (customer paying) on 01.04.2012 1,200
Sale on hire purchase basics during the year ended
31.03.2013
9,00,000
Cash received during the year 9,30,000
Goods reposed (installment due Rs.2000) value at 21,000
Installment due customers still paying on 31.03.2013 2,000