DISTANCE EDUCATION
B.Com. (Co-operation) DEGREE EXAMINATION, MAY 2017.
FINANCIAL ACCOUNTING
Time Three hours Maximum 100 marks
PART A — 8 40 marks)
Answer any FIVE questions only.
1. What are the different types of Cash Books?
2. Why is the need for preparation of Bank Reconciliation
Statement?
3. What are the differences between Consignment and Joint
Venture Accounts?
4. Ramesh purchased goods from Santhosh on different
dates. The date of each purchase and its due date is given
below.
Date Rs. Due Date
7.1.1993 1,016 Due on 12.2.1993
20.1.1993 366 Due on 23.3.1993
16.3.1993 136 Due on 19.5.1993
19.4.1993 828 Due on 22.5.1993
Ascertain the average due date.
5. What are the differences between Receipts and Payments
Accounts and Income and Expenditure Account.
Sub. Code
15
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6. Anand and Balu started a Partnership business on
1.1.1989 with capitals of Rs. 60,000 and Rs. 40,000
respectively. On 30th June 1989 Anand introduced further
capital of Rs. 20,000. Drawings during the year amounted
to Rs. 12,000 and Rs. 8,000 respectively for Anand and
Balu. Interest on Capital is to be allowed at p.a. No
interest is to be charged on drawings. Balu is to be
allowed a salary of Rs. 2,000 p.m. The profit for the year
before charging salary and interest amounted to
Rs. 80,000.
You are required to prepare the accounts of the partners
presuming capital to be fluctuating.
7. X Ltd forfeited 30 shares of Rs. 10 each fully called up,
held by Saroja for non-payment of allotment money of
Rs. 3 per share and first and final call of Rs. 4 per share.
She had paid the application money of Rs. 3 per share.
These shares were forfeited and reissued to Devi for Rs. 8
per share. Pass necessary journal entries for forfeiture
and reissue of shares.
8. As on 31st December 1985, the books of the Asia Bank,
include among others, the following balances.
Rs.
Rebate on bills discounted (1.1.1985) 3,20,000
Discount received 46,00,000
Bills discounted and purchased 3,15,47,000
Throughout 1985, the bank's rate for discounting has
been 18%.
On investigation and analysis, the average due date for
the bills discounted and purchased is calculated as 14th
February 1986.
Show the calculation of the amount to be credited to the
banks Profit and Loss A/c under discount earned for the
year 1985. Show also the journal entries required to
adjust the above mentioned accounts.
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PART B — × 15 60 marks)
Answer any FOUR questions only.
9. From the following balances of Saravanan, prepare a
Trading Profit and Loss A/c and Balance Sheet as on
31st December 1995.
Credit Balances Rs. Debit Balances Rs.
Capital 72,000 Debtors 7,770
Creditors 17,440 Salaries 8,000
Bills Payable 5,054 Discount 2,000
Sales 1,56,364 Postage 546
Loan 24,000 Bad debts 574
Interest 2,590
Insurances 834
Machinery 20,000
Stock (1.1.95) 19,890
Purchases 1,24,184
Wages 8,600
Buildings 47,560
Furniture 32,310
Closing stock as on 31.12.95 is Rs. 28,600.
10. Define Bills of Exchange. What are the advantages of
Bills of Exchange? Explain the types of Bills of Exchange.
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11. The following is the Receipts and Payments Account of
Bombay Football association for the first year ending
31st Dec. 1987.
Receipts Rs. Payments Rs.
To Donation 50,000 By Pavilion office 40,000
To Reserve fund (constructed)
(Life Membership fees and By Expenses in
entrance fees received) 4,000 Connection with
To Receipts from football matches) 900
matches 8,000 By Furniture 2,100
Revenue Receipts By Investments
To Subscriptions 5,200 at cost 16,000
To Locker Rents 50 Revenue Payments
To interest on Securities 240 By Salaries 1,800
To Sundries 350 By Wages 600
By Insurance 350
By Telephone 250
By Electricity 110
By Sundry Expenses 210
By Balance on hand 5,520
67,840 67,840
Additional Information
Subscriptions outstanding for 1987 are Rs. 250
Salaries unpaid for 1987 are Rs. 170.
Wages unpaid for 1987 are Rs. 90.
Outstanding bill for sundry expenses is Rs. 40.
Donations received have to be capitalised.
Prepare from the details given above an income and
expenditure a/c for the year ended 31.12.1987 and
the balance sheet of the association as on that date.
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12. A and B were partners sharing profits and losses in the
ratio of 2:1. Their balance sheet as on 31.12.2003 was as
follows
Liabilities Rs. Assets Rs.
Creditors 65,900 Cash 1,200
Capital A 30,000 Debtors 9,700
B 20,000 Stock 20,000
Machinery 35,000
Building 50,000
1,15,900 1,15,900
They decided to admit as a partner for rd
3
1 share in
the profits of the firm, subject to the following conditions
That be should using in Rs. 15,000 as his capital.
That the value of stock and machinery be
depreciated by 10%
That the provision of on sundry debtors be made
for doubtful debts.
That the value of buildings be appreciated by
Rs. 9,500.
Prepare necessary ledger accounts and balance
sheet after admission.
13. A,B and C are partners in a firm sharing profits and
losses in the ratio of
6
1
2
1
3
1 respectively. Their balance
sheet as on 31.3.2006 was as follows.
Liabilities Rs. Assets Rs.
Reserve fund 16,000 Building 50,000
Capital Machinery 40,000
A 30,000 Furniture 10,000
B 40,000 Stock 25,000
C 25,000
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Loan payable 15,000 Debtors 18,000
Sundry creditors 25,000 provision 500 17,500
Cash 8,500
1,51,000 1,51,000
retires on 31.3.2006 subject to the following
conditions.
Goodwill of the firm is valued at Rs. 24,000
Machinery to be depreciated by 10%
Furniture to be depreciated by
Stock to be appreciated by 15% and buildings to be
appreciated by 10%
Reserve for doubtful debts to be raised to Rs. 2,000.
Prepare necessary ledger accounts and show the
balance sheet of the new firm.
14. Blue stat prospects Ltd., issued 40,000 shares of Rs. 10
each a premium of Rs. 2 per share. The shares were
payable as follows
Rs. 2 on application
Rs. 5 on allotment (including premium)
Rs. 5 on first and final call.
All the shares were applied for and allotted. All moneys
were received with the exception of the first and final call
on 1,000 shares which were forfeited. 400 of these were
reissued as fully paid at Rs. 8 per share.
Give journal entries.
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15. From the following information relating National Bank
Ltd., prepare the profit and loss A/c for the year ended
31st December 1987.
Rs. Rs.
Rent received 72,000 Salaries and
allowances 2,18,800
Exchange and
commission
32,800
Postage 5,600
Interest on fixed
deposits
11,00,000
Sundry charges 4,000
Interest on savings bank
accounts
2,72,000
Director's and
auditor's fees 16,800
Interest on overdrafts 2,16,000 Printing 8,000
Discount on bills
discounted
7,80,000
Law charges 31,000
Interest on current 1,68,000 Locker rent 1,400
Interest on cash credits 8,92,000 Transfer fees 2,800
Depreciation on bank
property
20,000