Reg. No.

APRIL 2023 U/401/09-21/03101

ACCOUNTING FOR MANAGERS – I

Time : Three hours Maximum : 100 marks

SECTION A — (10 × 2 = 20 marks)

Answer ALL the questions.
1. Define Accounting.
2. Mention two objectives of accounting?
3. State two differences between financial accounting and
management accounting?
4. What do you mean by triple column cash book?
5. State two features of double entry system?
6. What is meant by revenue in accounting?
7. State any four causes of depreciation.
8. Write about Bad debts.
9. Give the meaning of Rectification of errors.
10. Write a short note on Final Accounts.

SECTION B — (5 × 7 = 35 marks)
Answer ALL the questions.
11. (a) Journalise the following transactions in the books of Sri
T.N. of Coimbatore:
1987
October
1. Commenced business with . 50,000
3. Purchased goods for cash . 10,000 at 5% trade
discount.
4. Paid carriages . 50
8. Purchase machinery for . 20,000
10. Sold goods to Madan on account for . 15,000

Or
 (b) Enter the following transactions in a simple cash book of
Suresh Kumar
1999
April
1 Commenced business with cash 24,000
5 Bought goods for cash 6,000
10 Goods sold for cash 11,200
13 Paid into bank 2,500
14 Sold goods to Ganesan to credit 9,000
15 Bought goods from Mohan on credit 13,600
20 Purchased furniture 9,600
21 Purchased stationery 160
23 Received cheque from Ganesan 9,000
25 Paid Mohan 13,600
26 Received commission 740
27 Paid telephone charges 300
30 Drawn from bank 3,800

12. (a) A machine purchased on 1st July 1983 at a cost of . 14,000

and . 1,000 was spent on its installation. The depreciation
is written off at 10% on the original cost every year. The
books are closed on 31st December each year. The machine
was sold for .9,500 on 31st March 1986. Show the
machinery account.

Or
(b) The following balances were extracted from the ledger of
Ramakrishna Engineering works as on 31/3/1997. You are
required to prepare a trial balance as on that date in
proper form.
S.No Name of account .
1 Drawings 6,000
2 Capital 24,000
3 Sundry creditors 43,000
4 Bills payable 4,000
5 Sundry debtors 50,000
6 Bills receivable 5,200

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 S.No Name of account .
7 Loan from karthik 10,000
8 Furniture and fittings 4,500
9 Opening stock 47,000
10 Cash in hand 900
11 Cash at bank 12,500
12 Tax 3,500
13 Sales 1,28,000
14 Salaries 9,500
15 Sales return 1,000
16 Purchase return 2,000
17 Travelling expenses 4,600
18 Commission paid 1,000
19 Trading expenses 2,500
20 Discount earned 4,000
21 Rent 2,000
22 Bank overdraft 6,000
23 Purchases 70,800
2,20,100

13. (a) Prepare Receipts and payments A/c of a club for the year
ended 31st December 1999 from the following particulars:
Particulars . Particulars .
Opening balance of cash 40,000 Rent paid 1,200
Receipt of entrance fees 8,000 Payment for purchase of
Subscription received 1999 16,000 cricket balls 500
Previous year’s Payment for purchase of
subscription received 1,600 cricket bats 1,600
Paid salaries 2,000 Payment for stationery
Paid for miscellaneous expenses 200 in cash 100

Or
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 (b) (i) Purchases book is carried forward . 350 less
(ii) Sales book total is carried forward . 500 more
(iii) A total of . 758 in the purchases book has been
carried forward as . 857
(iv) The total of the sales book . 755 on page 20 was
carried forward to page 21 as . 557
(v) Purchase returns book was carried forward as
. 5,120 instead of . 1,520.
Prepare rectification entries.
14. (a) The bank overdraft of Rajini on 31/12/93 as per cash book
is . 9,000. From the following particulars, prepare bank
reconciliation statement.
Particulars .
Un presented cheque 3,000
Uncleared cheque 1,700
Bank interest debited in the pass book only 500
Bill collected and credited in the pass book only 800
Cheque of Renu dishonoured cheque 500
Or

(b) A Second hand machine was purchased on 1.1.90 for

Rs. 30,000 and repair charges amounted to Rs. 6,000. It
was installed at a cost of Rs. 4,000. On 1st July 1991,
another machine was purchased for Rs.26,000. On 1st July
1992 the first machine was sold for Rs. 30,000. On the
same day, one more machine was bought for Rs. 25,000. On
31.12.92, the machine bought on 1st July 1991 was sold for
Rs. 23,000. Accounts are closed every year on 31st
December. Depreciation is written off at 15% per annum.
Prepare the Machinery A/c for 3 years ending 31.12.92.
15. (a) Prepare trading and profit loss account from the
information given below :
Particulars . Particulars .
Opening stock 3,600 Rent(factory) 400
Purchases 18,260 Rent(office) 500
Wages 3,620 Sales return 700
Closing stock 4,420 Purchase returns 900
Sales 32,000 General expenses 900
Carriage on purchases 500 Discount to customers 360
Carriage on sales 400 Interest from bank 200
Or
(b) Give the disadvantages of single entry system.

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 SECTION C — (3 × 15 = 45 marks)

Answer ALL the questions.

(Q.No. 16 is a compulsory)

16. Enter the following transaction in a three Column Cash Book.

Date Particulars .
Jan
1 Cash in hand 410
8,920
Balance at Bank
2 Cash Sales 4,500
3 Paid into Bank 4,000
5 Purchased Stationery 100
8 Paid Mahesh by Cheque 280
20
Discount Received
12 Gave a cheque for cash purchases 1,500
15 Drew for personal use 500
18 Received from Suresh, a cheque for . 1,970
in full settlement of account for . 2,000 and
deposited it in Bank
20 Drew from Bank 1,000
21 Paid wages 800
25 Bank returned cheque of Suresh dishonoured
31 Bank charges as per Pass Book 10

17. (a) Prepare trading, profit and loss a/c and balance sheet from
the following trial balance of Mr.M. Madan
Debit balances . Credit balances .
Sundry debtors 92,000 Madans capital 70,000
Plant and machinery 20,000 Purchase return 2,600
Interest 430 Sales 2,50,000
Rent, rate, taxes and insurance 5,600 Sundry creditors 60,000
Conveyance charges 1,320 Bank overdraft 20,000
Wages 7,000
Sales return 5,400
Purchases 1,50,000
Opening stock 60,000
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 Debit balances . Credit balances .
Madan’s drawings 22,000
Trade expenses 1,350
Salaries 11,200
Advertising 840
Discount 600
Bad debt 800
Business premises 12,000
Furniture and fixtures 10,000
Cash in hand 2,060
4,02,600 4,02,600

(i) Stock on hand on 31-12-1995 . 90,000.

(ii) Provide depreciation on premises at 2.5%, plant and
machinery at 7.5% and furniture and fixture at 10%.
(iii) Write off . 800 as further bad debts.
(iv) Provide for doubtful debts at 5% on sundry debtors.
(v) Outstanding rent was . 500 and outstanding wages
. 400.
(vi) Prepaid insurance . 300 and prepaid salaries . 700.

Or
(b) From the following balance extracted at the close of the
year ended 31st Dec 1996. Prepare profit and loss account of
Mr. Raj as at that date.
Particulars Amount Particulars Amount
. .
Gross profit 55,000 Repairs 500
Carriage on sales 500 Telephone expenses 520
Office rent 500 Interest (Dr) 480
General expenses 900 Fire insurance premium 900
Discount to customers 360 Bad debts 2,100
Interest from bank 200 Apprentice premium (cr) 1,500
Travelling expenses 700 Printing and Stationery 2,500
Salaries 900 Trade expenses 300
Commission 300

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18. (a) A company whose accounting year is the calendar year,
purchased on 1-1-93 a machine for . 40,000. It purchased
further machinery on 1st October 1993 for . 20,000 and on
1st July 1994 for . 10,000. On 1-7-95, 1/4th of the
machinery installed on 1-1-93 became obsolete and was
sold for . 6,800. Show how the machinery account would
appear in the books of the company for all the 3 years
under Diminishing balance method. Depreciation provided
at 10% p.a.

Or
(b) The position of a business man who keeps his books on
single entry was as under on 31/12/90 and 31/12/91
Particulars 1990 1991
. .
Cash at hand 400 480
Cash in bank 6,000 2,500
Stock 6,500 5,000
Debtors 4,000 5,200
Furniture 300 350
Sundry creditors 4,100 3,100

He withdraws Rs.7,500 from business on 2/1/91 out of

which he spent . 5,200 for purchase of a motor truck for
the business.
Adjustment:
(i) Depreciation on closing balance of furniture and
truck at 10%.
(ii) Write off . 220 as bad debts.
(iii) 5% provision for bad and doubtful debts is needed.
Find out the profit or loss for the year.

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