COMMERCE UNLOCKED

Prakash Kumar
[Link].; M.L.S.W.; LL.B.; [Link].; STET.
"an educationist serving since 1985"
Recipient of"BIHAR SHIKSHA RATNA AWARD 2010"
& "BIHAR KESHARI SHIKSHA SHIROMANI SAMMAN 2011"
Call/ Wapp: 7004597725
E-Mail: commerceunlocked@[Link]
 COMMERCE UNLOCKED
ACCOUNTANCY (055)
CU-XI-ACC-PMP-SET-7 (2024-25)

DURATION: 3 HRS. MAX. MARKS: 80

General Instructions:
1. This question paper contains 34 questions. All questions are compulsory.

2. This question paper is divided into two parts, Part A and B.

3. Question 1 to 17 and 27 to 29 carries 1 mark each.

4. Questions 18 to 20 and 30 to 32 carries 3 marks each.

5. Questions from 21 to 23 carries 4 marks each.

6. Questions from 24 to 26, 33 and 34 carries 6 marks each.

Part A
1. Each cheque has a counterfoil in which the same details as entered in the cheque are filled. The counterfoil [1]
remains with the ________ for future purposes.

a) cashier b) bank

c) account holder d) Both cashier and account holder

2. Assertion (A): The main purpose of cost accounting is to ascertain total cost and per unit cost of goods [1]
produced.
Reason (R): The main purpose of financial accounting is to record the business transactions and to ascertain
profit or loss and the financial position of the business.

a) Both A and R are true and R is the correct b) Both A and R are true but R is not the
explanation of A. correct explanation of A.

c) A is true but R is false. d) A is false but R is true.

3. Bank account is a: [1]

a) Real account b) Nominal account

c) Personal account d) Revenue account

4. Goods costing Rs. 20,000 were sold for cash at a profit of 25%. By what amount stock account will decrease [1]

a) Rs.25,000 b) Rs.15,000

c) Rs.20,000 d) Rs.20,500
OR
If a business transaction results in the increase of assets, there will also be a corresponding increase in the amount of

a) liabilities b) both liabilities and capital

c) none of these d) capital

 5. The business documents which serves as the evidence of the business transactions are known as [1]

a) Notes b) Source documents

c) First hand documents d) Bills

6. Identified and measured accounting events should be recorded in which order: [1]

a) Any order b) Horizontal

c) Vertical order d) Chronological order

OR
Which of the following is not a business transaction?
A. Withdrew ₹ 10,000 from business for personal use by the proprietor.
B. Proprietor Withdrew ₹ 20,000 from the Bank Account of the firm to pay the school fees of his son.
C. Proprietor withdrew ₹ 12,000 from his personal account to pay the school fees of his son.
D. Goods taken worth ₹ 3,000 for personal use.

a) Statement (B) is correct. b) Statement (C) is correct.

c) Statement (D) is correct. d) Statement (A) is correct.

7. Profit on sale of assets is used to create: [1]

a) Capital Reserve b) Specific Reserve

c) Both Specific Reserve and General Reserve d) General Reserve

8. Which account will be debited if proprietor pays ₹ 5,000 as life insurance premium from business cash? [1]

a) Bank A/c b) Drawings A/c

c) Cash A/c d) Insurance A/c

OR
Goodwill account is a:

a) Nominal Account b) Real Account

c) representative personal account d) Personal Account

9. Ind-AS-1 deals with [1]

a) disclosure of accounting policies b) None of these

c) plant, property and equipment d) statement of cash flows

10. As per Revenue Recognition Concept, revenue is deemed to be realised: [1]

a) When cash is received from the purchaser b) When purchase order is received from the
purchaser

c) When the title of the goods has been d) When goods are delivered to the purchaser
transferred to the purchaser
11. Provision is made: [1]

a) To strengthen the financial position b) To face the financial difficulties

c) To provide for known losses d) To provide for unknown losses

12. A person who owes money to the firm is called ________. [1]
 a) Supplier b) Creditor

c) Debtor d) Purchaser
13. Debit notes issued are used to prepare: [1]

a) Purchases Book b) Purchases Return Book

c) Sales Return Book d) Sales Book

14. Main elements of accounting equation are: [1]

a) Bank balance, Investments and Bills b) Capital, Creditors and Bills Payable
Receivable

c) Assets, Liabilities and Capital d) Cash, Stock and Debtors

15. ________ are those assets that cannot be realised in cash, or no further benefit can be derived, from these assets. [1]

a) Current assets b) Real assets

c) Nominal assets d) Realisable assets

OR
X is a part of the inventory of a firm. X needs further processing for converting into finished products i.e X consists
of partly finished goods or semi-finished goods. Identify X.

a) Inventory of stock-in-trade b) Inventory of finished goods

c) Inventory of raw material d) Inventory of work-in-progress

16. Sale of business asset on credit is recorded in: [1]

a) Journal Proper b) Special Journal

c) Sales Book d) Cash Book

17. A Provision is: [1]

a) an appropriation of profits b) Distribution of profits

c) a charge against profit d) can be an appropriation of profits and a

charge against profit
18. Explain the procedure for balancing a ledger account. [3]
OR
Journalise the following transactions in the books of Madan.

Sept Sold goods costing Rs 45,000 to Suresh at a profit of 33 % on cost less 20%. Trade discount and paid
1

2 carriage Rs 400 (to be charged from the customer).

Sept
Spent Rs 300 for refreshment of a customer.
5

Sept
Machinery purchased Rs 10,000 paid, installation expenses Rs 2,500.
7

Sept Sold goods costing Rs 40,000 to Prateek for cash at a profit of 25% on cost less 20% trade discount and paid
9 cartage Rs200 (not to be charged from the customer).

19. Goods of ₹ 10,000 purchased intra-state were destroyed in rain. If rates of CGST and SGST are 6% each and [3]
that of IGST is 12%, Pass the Journal entry for the goods destroyed.
 OR
What are the exceptions of revenue recognition principle? Explain in brief.
20. Distinguish between expenses and expenditure. [3]
21. Prepare correct Trial Balance from the following Trial Balance in which there are certain mistakes: [4]

Heads of Accounts Dr. (₹) Cr. (₹)

Adjusted Purchases 1,50,000 -

Closing Stock - 40,000

Debtors - 60,000

Creditors - 30,000

Fixed Assets 50,000 -

Opening Stock 60,000 -

Expenses - 20,000

Sales - 2,00,000

Capital 90,000 -

Total 3,50,000 3,50,000

22. Prepare bank column cash book from the following transactions of M/s Laser Zone for the month of January [4]
2017 and post them to the related ledger accounts:

Date 2017 Details Amount (₹)

Jan. 01 Cash in hand 4,000

Bank overdraft 3,200

Jan. 04 Wage paid 400

Jan. 05 Cash sales 7,000

Jan. 07 Purchased goods by cheque 2,000

Jan. 09 Purchased furniture for cash 2,200

Jan. 11 Cash paid to Rohit 2,000

Jan. 13 Cash sales 4,500

Jan. 14 Deposited into bank 7,000

Jan. 16 Bank charged interest on overdraft 200

Jan. 20 Paid telephone bill by cheque 600

Jan. 25 Sale of goods and received cheque (deposited same day) 3,000

Jan. 27 Paid rent 800

Jan. 29 Drew cash for personal use 500

Jan. 30 Paid salary 1,000

 Jan. 31 Interest collected by bank 1,700

23. From the following particulars ascertain the balance that would appear in the Bank Pass Book of A at 31st [4]
December 2013:
i. The bank overdraft as per Cash Book on 31st December 2013 ₹ 63,400.
ii. Interest on overdraft for 6 months ending 31st December 2013, ₹ 1,600 is entered in the Pass Book.
iii. Bank charges of ₹ 300 for the above period are debited in the Pass Book.
iv. Cheques issued but not cashed prior to 31st December 2013 amounted to ₹ 11,680.
v. Cheques paid into bank but not cleared before 31st December 2013 were for ₹ 21,700.
vi. Interest on investments collected by the bank is credited in the Pass Book ₹ 12,000.
OR
On 30th June, 2023, the Cash Book of M/s Ravi and Shiv showed a balance of ₹4,000 at Bank. They had sent
cheques amounting to ₹20,000 to the bank before 30th June, but it appears from the Pass Book that cheques worth
only ₹8,000 had been credited before that date. Similarly, out of cheques of ₹10,000 issued during the month of June,
cheques for ₹500 were presented and paid in July.
The PassBook also showed the following payments:
i. ₹640 as premium on the life policy according to standing instructions; and
ii. ₹4,000 against a pro-note, as per instructions.
The Pass Book showed that the bank had collected ₹1,200 as interest on Government Securities. The bank had
charged interest ₹ 100 and bank charges ₹40. There was no entry in the Cash Book for the payments, interest etc.
Prepare the Bank Reconciliation Statement as on 30th June, 2023.
24. Pass the Journal entries for the following transactions: [6]

2023 ₹

April 1 Govind started business with cash 1,00,000

April 2 Purchased office furniture in cash 5,000

April 3 Purchased goods in cash 20,000

April 4 Purchased goods from Harsh & Co. 1,00,000

April 5 Sold goods against cash 20,000

April 6 Sold goods to Ram & Co. 75,000

April 7 Paid salary to staff in cash 15,000

April 8 Paid electricity bill 2,000

April 9 Paid telephone bill 500

April 10 Purchased stationery in cash 250

OR
Journalise the following transactions:

2017 Amount (₹)

Dec.01 Hema started business with cash 1,00,000

Dec.02 Open a bank account with SBI 30,000

 Dec.04 Purchased goods from Ashu 20,000

Dec.06 Sold goods to Rahul for cash 15,000

Dec.10 Bought goods from Tara for cash 40,000

Dec.13 Sold goods to Suman 20,000

Dec.16 Received cheque from Suman 19,500

Discount allowed 500

Dec.20 Cheque given to Ashu on account 10,000

Dec.22 Rent paid by cheque 2,000

Dec.23 Deposited into bank 16,000

Dec.25 Machine purchased from Parigya 10,000

Dec.26 Trade expenses 2,000

Dec.28 Cheque issued to Parigya 10,000

Dec.29 Paid telephone expenses by cheque 1,200

Dec.31 Paid salary 4,500

25. Pass journal entries to rectify the following errors in the books of Mohit, which were located after preparation of [6]
Trial Balance:
i. Goods of the value ₹ 5,000 returned by Anamika were entered in the Sales Book and posted therefrom to the
credit of her account.
ii. Payment of ₹ 1,000 to Rishi and ₹ 1,200 to Sunil was made but Rishi was debited with ₹ 1,200 and Sunil
with ₹ 1,000
iii. A sum of ₹ 375 owed by Arjit has been included in the list of sundry creditors.
iv. Credit sales to Mohit ₹ 14,000 were posted to the credit of his account.
OR
The following errors were found in the book of Rajan & Sons. Give the necessary entries to correct them.
i. Repairs made were debited to building account Rs 100.
ii. An amount Rs 200 withdrawn by the proprietor for his personal use has been debited to trade expenses account.
iii. Rs 200 paid for rent debited to landlord's account.
iv. Salary Rs 250 paid to a clerk due to him has been debited to his personal account.
v. Rs 200 received from Rina & Co has been wrongly entered as from Reena & Co.
vi. Rs 1400 paid in cash for a typewriter was charged to office expenses account.

26. On 1st April, 2021, M/s. Amit Bros. Drycleaners, purchased 5 Washing Machines for ₹ 15,000 each. They sold [6]

on 1st April, 2022 one machine for ₹ 12,500. They charged depreciation @ 10% by the Straight Line Method.
Prepare the Washing Machine Account, Washing Machine Disposal Account and Provision for Depreciation

Account for two years. Accounts are closed on 31st March every year.
OR
On 1.1.2011 Machinery was purchased for Rs 80,000. On 1.7.2012 additions were made to the account of Rs 40,000.
On 31.3.2013 machinery purchased on 1.7.2012 costing Rs 12,000 was sold for Rs 11,000 and on 30.6.2013
 machinery purchased on 1.1.2011, costing Rs 32,000 was sold for Rs 26,700. On 1.10.2013 additions were made to
the amount of Rs 20,000. Depreciation was provided at 10% p.a. on the Diminishing Balance Method.
Show the Machinery Account for three years from 2011 to 2013 (Year ended 31st December).
Part B
27. Profit = Capital at the end + ? - Capital introduced - Capital in the beginning. [1]

a) Sales b) Journal

c) Net Purchases. d) Drawings

OR
Two adjustments should be made to ascertain the profit

a) Capital introduced and sale b) Capital introduced and drawing

c) Purchase and drawing d) Capital introduced and purchase

28. Which of the following will be treated as drawings of the proprietor: [1]

a) Life Insurance Premium b) Advance Payment of Income Tax

c) Income Tax d) All of these

29. Following information is taken from the Trial Balance of a business: [1]
Sales: ₹ 1,00,000; Purchase: ₹ 60,000; Wages ₹ 7,000.
Closing stock was ₹ 3,000 more than opening stock. What was the Gross Profit?

a) ₹ 33,000 b) ₹ 40,000

c) ₹ 30,000 d) ₹ 36,000
OR
Calculate provision for doubtful debt. If debtor closing balance is Rs.3,400 and provision for the reserve of doubtful
debts at 10% on sundry debtors

a) Rs.2,060 b) Rs.3,400

c) Rs.340 d) Rs.3,060
30. Explain what is meant by capital receipts. Give examples. [3]
31. From the following information, prepare trading account for the year ended 31st March, 2013 [3]

Amt (Rs.)

Cost of goods sold 45,00,000

Sales 72,00,000

Closing Stock 2,40,000

32. Rajesh valued stock at the end of the year at ₹ 1,00,000. Goods costing ₹ 5,000 were destroyed by fire during the [3]
accounting period. Show the treatment if the goods are not insured.
33. Mr. Muneesh maintains his books of accounts from incomplete records. His books provide the information: [6]

April. 01, 2016 (₹) March. 31, 2017 (₹)

Cash 1,200 1,600

Bills receivable - 2,400

 Debtors 16,800 27,200

Stock 22,400 24,400

Investment - 8,000

Furniture 7,500 8,000

Creditors 14,000 15,200

He withdrew ₹ 300 per month for personal expenses. He sold his investment of ₹ 16,000 at 2% premium and
introduced that amount into business.
OR
Ram Prashad maintains his books on Single Entry System, and from them and the particulars supplied, the following
figures were gathered together on 31st March 2023:
Books Debts, ₹ 10,000, Cash in Hand, ₹ 510, Stock in Trade (Estimated) ₹ 6,000, Furniture and Fittings, ₹ 1,200,
Trade Creditors, ₹ 4,000, Bank Overdraft, ₹ 1,000. Ram Prashad stated that he started business on 1st April, 2022
with Cash ₹ 6,000 paid into bank but stocks valued at ₹ 4,000. During the year he estimated his drawings to be ₹
2,400. You are required to prepare the statement, showing the profit for the year, after writing off 10% for
depreciation on furniture and fittings.
34. The following balances were extracted from the books of M/s Panchsheel Garments on March 31, 2017. [6]

Account Title Debit Amount (₹) Account Title Credit Amount (₹)

Opening stock 16,000 Sales 1,12,000

Purchases 67,600 Return outwards 3,200

Return Inwards 4,600 Discount 1,400

Carriage inwards 1,400 Bank overdraft 10,000

General expenses 2,400 Commission 1,800

Insurance 4,000 Creditors 16,000

Scooter expenses 200 Capital 50,000

Salary 8,800

Cash in hand 4,000

Scooter 8,000

Furniture 5,200

Buildings 65,000

Debtors 6,000

Wages 1,200

1,94,400 1,94,400

Prepare the trading and profit and loss account for the year ended March 31, 2017 and a balance sheet as on that
date.
a. Unexpired insurance ₹ 1,000.
 b. Salary due but not paid ₹ 1,800.
c. Wages outstanding ₹ 200.
d. Interest on capital 5%.
e. Scooter is depreciated @ 5%.
f. Furniture is depreciated ₹ @ 10%.
g. Closing stock was ₹ 15,000.
OR
From the following ledger balances of Mr Charan Singh, prepare the trading and profit and loss account for the year
ended 31st March, 2013 and the balance sheet as at that date after making the necessary adjustments.

Particulars Amt (Rs) Particulars Amt (Rs)

Trade expenses 800 Purchases 82,000

Freight and duty15,000 2,000 Stock (1st April, 2010) 15,000

Carriage outwards 500 Plant and machinery (1st April, 2012) 20,000

Sundry debtors 20,600 Plant and machinery (additions on 1st October, 2012) 5,000

Furniture and fixtures 5,000

Return inwards 2,000 Drawings 6,000

Printing and stationery 400 Capital 80,000

Rent, rates and taxes 4,600 Provision for doubtful debts 800

Sundry creditors 10,000 Rent for premises sublet 1,600

Sales 1,20,000 Insurance charges 700

Return outwards 1,000 Salaries and wages 21,300

Postage arid telegraphs 800 Cash in hand 6,200

Cash at bank 20,500

Additional Information
i. Stock on 31st March, 2013 was Rs 14,000.
ii. Written-off Rs 600 as bad debts,
iii. Provision for doubtful debts is to be maintained @ 5%.
iv. Provision for depreciation on furniture and fixtures at 5% per annum and on plant and machinery at 20% per
annum.
v. Insurance prepaid was Rs 100.
vi. A fire occurred in the godown and stock of the value of Rs 5,000 was destroyed. It was insured and the insurance
company admitted full claim.
COMMERCE UNLOCKED
Prakash Kumar
[Link].; M.L.S.W.; LL.B.; [Link].; STET.
"an educationist serving since 1985"
Recipient of"BIHAR SHIKSHA RATNA AWARD 2010"
& "BIHAR KESHARI SHIKSHA SHIROMANI SAMMAN 2011"
Call/ Wapp: 7004597725
E-Mail: commerceunlocked@[Link]