1. P-and Q are partners sharing profits and losses the ratio of $:4. They admitted R for 1/5th profit, for which he paid & 90,000 against capital and & 45,000 against goodwill. Find the capital balance for cach partner taking R's capital as base capital a) (a) %2,00,000; % 90,000; % 90,000 (b) — %3,00,000; % 2,40,000; & 1,35,000 (c) %2,00,000; & 1,60,000; % 90,000 * (d) —%3,00,000; & 1,35,000; & 1,35,000 ‘Assertion (A) : Partners are principals but not the agents of other partners. qd) Reason (R) : As per the definition of partnership, business can be carried any of them acting for all. Thus, they are principals and also the agents. In the context of above two statements, which of the following is correct? (a) Both Assertion (A) and Reason (R) are correct and (R) is the correct explanation of (A). (b) Both Assertion (A) and Reason (R) are correct but (R) is not the correct explanation of (A). * (c) _ Assertion (A) is correct, but Reason (R) is incorrect. (d) Assertion (A) is incorrect, but Reason (R) is correct. 3. _ Incase of private placement of shares, to raise the amount of capital a company: a (a) _ invites public through prospectus (6) _ does not invite the public (c) _ Invites the public through advertisement (4) _ invites the public through Memorandum of Association OR A company forfeited 700 shares of 10 each fully called up, on which only ® 5 per share was paid, Of these, 200 shares were reissued at @ 9 per share, Amount transferred from share Forfeiture account to Capital Reserve Account will be: (a) %800 (b) %200 (c) %3,500+ (d) 22,500A, B and C were partners in a firm sharing profits in the ratio of 5:3:2. They decided to share the future profits in the ratio of 2:3:5. For this purpose the goodwill of the firm was valued at € 1,20,000, In adjustment entry, for the treatment of goodwill due to change in the profit sharing ratio: oO) (a) Cr. A by € 24,000; Dr. C by & 24,000 (b) Cr. A by % 60,000; Dr. C by & 60,000 (©) Cr. A by® 36,000; Dr. C by & 36,000 (d) Dr. A by 8 36,000; Cr. C by % 36,000 « OR P, Qand R were in partnership sharing profits in the ratio of 4:3:1, The partners agreed to share future profits in the ratio of 5:4:3. Each partner's gain or sacrifice due to change in ratio will be: = 4 a Peel ; P a = (2) Psactifice ©; Q sacrifice =; R gain l ae 2 Pee) P sacrifice 1; ae ae (b) sacrifice Ee Q sacrifice 3g) gain a (©) Pgain 2; Qgain +; R sacrifice 2 24° 24" 24 (@) sacrifice 2; Q gain 2; R sacrifice + 24” 24” 24 A, B and C are partner's sharing profits in the ratio of 5:3:2. According to the partnership agreement C is to get a minimum amount of € 20,000 as his share of profits every year. The net profit for the year ended 31st March, 2019 amounted to % 80,000. How much amount contributed by A in favour of C? a) (a) %1,500 (b) % 1,250 (ce) %2,500 (@) %4,000- OR 5 XIIFACCOUNTANCy.p.nie y X, Y and Z are partners in a firm. At the time of division of profit for the year, there was dispute among the partners. Profits before interest on Partner's loan were % 45,000. Y demands interest @ 24% pa on his loan of © 2,40,000, There was no agreement on his point, share of profit of X, Y and Z will be: (a) © 15,000 to each partner (b) & 12,600 for X and Z & Y F 19,800 (c) X-% 10,200; Y -% 39,000 & ZF 10, 200 (d@)_ & 10,200 to each partner. Z limited issued shares of € 100 each at a premium of 10%. Premium is to be adjusted with allotment. Mr. Q holding 500 shares paid & 20 on application but did not pay the allotment money of & 30. If the company forfeited his 30% shares immediately after allotment, the share forfeiture account will be credited by: qa) (a) % 4,500 (b) 2% 13,500 (c) %1,650 (@) 73,000. OR A machinery was purchased for % 9,00,000 and payment was made in shares of @ 100 each at 20% premium. Securities Premium Reserve A/C will be (a) Debited by @ 1,50,000 (b) Credited by & 1,50,000 (c) Debited by % 180,000 (d) credited by 2 1,80,000 Assertion (A) : Issued share capital & subscribed share capital are always different. (1) Reason (R) : Subscribed share capital is a part of Issued share Capital. Thus, it will always be different from Issued share capital. Codes: (a) Both Assertion (A) and Reason (R) are correct and (R) is the correct explanation of (A). (b) Both Assertion (A) and Reason (R) are correct but (R) is not the correct explanation of (A). (©) _ Assertion (A) is correct, but Reason (R) is incorrect. " (d) Assertion (A) is incorrect, but Reason (R) is correct.20. 21. Q, a partner, is to bear all expenses of realisation for which he is to be paid % 2,000. Q had to pay realisation expenses of % 2,500. How much amount will be debited to Realisation Account? (a) ©5,000 (b) © 2,500 () %4,500 (d) % 2,000 )X, ¥ and Z are partners in a firm sharing Profits & ¥osses is the ratio of 2:2:1. On March 31, 2022, Z died, Accounts are closed on Dec. 31 every year. The sales for the year 2021 was © 6,00,000 and profits were % 60,000. The sales for the period from Jan, 1, 2022 to March 31, 2022 were % 2,00,000. The share of deceased partner in the current year's profits on the basis of sales is: o (a) % 20,000. (b) 28,000 : (©) %3,000 (d@) 24,000 I, Pand L sharing profits in the ratio 4:3:2. I retires, P and L decided to share profits in future in the ratio of 3.5. Gaining ratio will be: a) @eoli2t . (b) 21:11 (©) 11:13 (13:11 The average profit of a business over the last five years amounted to % 60,000. The normal rate of return on capital invested in such a business is deemed to be 10% p.a. The net capital invested in the business is % 5,00,000. Amount of Goodwill, if it is based on 3 years, purchase of average super profits of past five years will be: a (a) %1,00,000 (b) 2 1,80,000 (c) %30,000° (d) 7 1,50,000 Accounting standard related to Goodwill is: . qd) (a) AS-23 (b) _AS-25 (c) AS-26. () AS-6 P and Q are partners sharing profits in 2:1. Goodwill is to be calculated at two years! purchase of the average normal profit of past three years. Profit/Loss of the last three years ended 31st march were: @) 2018 Profit 50,000 (Including gain on Sale of Investments € 5,000) *’ 2019 Loss % 20,000 (Includes loss by fire € 35,000) 2020 Profit % 70,000 (Includes undervaluation of opening stock & 10000) Calculate the value of Goodwill. 1B NI-ACCOUNTANCY.g22, ) Kareena and Karishma are partners with capitals of & 1,00,000 and % 80,000 respectively. 23. 24. They admitted Katrina on Ist April as a partner for 1/4th share. Katrina brought % 1,80,000 as capital but she could not bring her share of goodwill in cash. QB) Calculate value of Goodwill and Give necessary Journal Entry regarding premium for goodwill on Katrina's admission. At the time of A's retirement from the firm, give journal entries for the following: (3) (a) Plant reduced to 30,000 (Book value % 45,000) (b) Furniture reduced by 10% (Book value % 20,000) (c) Land valued at 110% of book value (Book value % 60,000) OR N, T and R are partners sharing profits equally. T retires, and the remaining partners decided to bring in a sufficient amount to make payment to T in such a manner to make their capitals in their new profit sharing ratio. Capital balances of N and R were % 1,26,300 & % 70,800 respectively and amount payable to T was ® 1,04,400. Calculate the amount to be brought in by N & R. Explain in brief the concept of private placement of shares and Employees stock option plan. GB) OR India Ltd. issued 10,000 shares of = 10 each. Application, were received for 15,000 shares. The amount was payable as follows: On Application % 4 per share and Balance in allotment of shares. Company decided to reject 3,000 shares’ applications and allotted shares to remaining applicants on pro-ratio basis. Give Journal entries assuming all the money was called. Which is meant by dissolution of a firm? State any two examples of compulsory dissolution. G) Himalaya Ltd. purchased Assets worth % 1,80,000 from Parvat Ltd. The purchase consideration was discharged by a bill of % 30,000 and balance by issuing equity shares of % 100 each at a premium of 20%. (3) You are required to give necessary journal entries. 15 XIL-ACCOUNTANCy.p27. 28. 29, 30. P, Q and R are partners sharing profits in $:3:2. Their fixed capitals are % 3,00,000 % 4,00,000 and & 3,00,000 respectively, Profit for the year ended 31st march 2021 was distributed equally without providing Interest on Capitals @ 10% p.a (4) Profit for the year ended 31" March, 2021 was & 1,50,000 Pass an adjustment entry to rectify the error. Show your calculations. OR A and B are partners sharing profits in 2:1. As per deed B is to get a salary of @ 15,000 per month and A is to get a commission of % 90,000 per annum, Profit for the year ended 31st march, 2021 Amounted to 2 1,50,000. You are required to show division of Profit between partners. Bilal and Zunaid are partners sharing profits in 3:2. On 1.4.2020, they decided to change the ratio to 2:1, On this date, goodwill of the firm was valued at % 60,000. On the same date, Assets were revalued as follows: (4) Stock decreased by % 3,000, Building increased by 9,000. Partners do not want to change Book values. Calculate Gaining ratio and Give necessary Journal entries On the date of dissolution of a firm, Pass Journal entries the following transactions: (4) (i) Loan by a partner P, settled by a debtor. (P's Loan ® 10,000) (ii) Balance Debtor % 40,000, Bad debts amounted % 6,000. (ii) Partner Q allowed a remuneration of % 10,000 and was to bear dissolution expenses. Dissolution expenses ® 4,000 was paid by firm (iv) Unrecorded stock worth & 8,000 realised % 5,000 Give Journal entries for the followings: (6) (a) Salary allowed to a partner Z, @ 5,000. (b) Interest on drawings charged from Y, a partner, % 2,000 (c) Interest on Partner X’s Loan @ 5,000. (d) Interest on Capitals allowed to X, Y and Z % 10,000, % 8,000 and % 6,000 Tespectively. (e) Commission allowed to X @ 10% of Net Profit - Net Profit amounted to 71,50,000. () Divisible Profit & 1,23,000 divided equally among X, Y and Z. 7 XI-ACCOUNTANCY.p3i. 32. 2. Murli, Manohar and Joshi are partners in a firm, sharing profits in 3:2:1, Books are being closed on 31st March every year, On June 30, 2018, Joshi died. After making all the adjustments amount due to his executors came to be & 1,20,000 Murli and Manohar decided to pay this amount into six half yearly instalments along with Interest @ 10%. pa (6) Prepare Joshi's executors A/c till the date of final settlement (a) Bhumi Ltd. Forfeited 500 shares of % 10 each on which only 4 per share has been received. Company did not make final call of 2 per share. Out of this 300 shares were reissued for % 6 per share, % 8 paid up. Pass necessary journal entries. (3+3) (>) Manthan Ltd. Forfeited 100 shares of € 100 each, issued at a premium of % 20 for non-payment of allotment of % 50 (including premium). Company did not make final call of % 30 per share. All these share were reissued at a premium of 20% Give necessary Journal entries. “M and N are partners sharing profits in the ratio of 3:1. Their balance sheet as on 31.3.2020 was as follows: © Liabilities z Assets r Creditors 28,000 | Bank 50,000 | Bills Payable 40,000 | Debtors 60,000 Outstanding Rent 2,000 | Stock 40,000 Capitals Machinery 1,00,000 M 2,00,000 Land 1,50,000 N 1,30,000 | 3 30,000 4,00,000 4,00,000O was admitted in the above date for ‘rd share, on the following teams: 3 (a) © will bring & 2,00,000 as his Capital and & 60,000 as premium for Goodwill. (b) Machinery is to be appreciated to © 1,30,000 and vale of land is appreciated by 5%. (c) Stock is overvalued by % 6,000. (@) A provision for doubtful debts is to be created @ 5%. (e) There were unrecorded creditors % 4,500. (Capitals of M and N are to be adjusted on the basis of O's capital. Difference to be adjusted through Cash/Bank A/c, Prepare Revaluation A/c and Capital A/es of partners. OR A, B and C are partners sharing profits in the ratio of 5:3:2. Their Balance Sheet as on 1.4.2021 was as follows: Liabilities z Assets z Creditors 10,000 Cash 2,000 Bills Payable 5,000 | Debtors 8,000 | General Reserve 6,000 Stock 40,000 Workmen Compensation Fund 2,000 | Furniture 13,000 Capitals Trade Marks 4,000 7 50,000 Land 60,000 B 35,000 Advertisement Suspense A/c 6,000 c 3.009 | 1 10,000 1,33,000 1,33,000 21 XIL-ACCOUNT;R,.34. C retires on the above date and partners agreed that (a) Goodwill is valued at & 20,000 (b) 5% provision for doubtful debts is to be made (©) Trademarks are value less. (d) Land be appreciated by 20% (ce) Ereditors are to be paid % 2.000 more. (1) Capital of new firm is fixed at 80,000 which is to divided among partners in new ratio any difference may be adjusted through to bank. Give Journal entries to record above transactions. Neelam Ltd. issued 60,000 equity shares of @ 10 each at a premium of 20%. The amount was payable as follows: (6) On application & 2, on allotment % 5 and balance on call Karan holding 3,000 shares failed to allotment money. His shares were immediately forfeited. Arjun failed to pay call money on 2,000 shares. His shares were also forfeited. 4,000 out of the forfeited shares were reissued at ® 9 per share fully paid up (including all the shares of Karan), Pass Journal entries in the books of the company. OR Rishika Ltd. offered 5,00,000 shares of 10 each for public subscription. The amount was payable as follows: On application % 5, on allotment % 3 and on call % 2. Applications were received for 6,00,000 shares. Pro-rata allotment was made to all the applicants, Mayank who applied for 12,000 shares did not pay allotment money. His shares were forfeited immediately. Company did not make final eall yet Give journal entries in the books of the company and show share capital inthe balange sheet of the company. i 2B XII-ACCOUNTANCY-E