Namma Kalvi 12th Accountancy Question Bank and Worksheet em 216264

Namma Kalvi
www.nammakalvi.in
G.K. VIDHYAA MANDHIR

MAT.HR.SEC.SCHOOL,KARUR.
ACCOUNTANCY WORKSHEETS - XII STD
 BOOK BACK ONE WORDS
 ILLUSTRATION PROBLEMS
 EXCERCISE PROBLEMS
 THEORY QUESTIONS
 GOVERNMENT MODEL QUESTION PAPER

www.nammakalvi.in
SL NO CONTENT PAGE NO
1. BOOK BACK ONE WORDS 1
2. THEORY QUESTIONS 19
3. UNIT – I ILLUSTRATIONS & 26
EXERCISES
4. UNIT – II ILLUSTRATIONS & 42
EXERCISES
5. UNIT – III ILLUSTRATIONS & 65
EXERCISES
6. UNIT – IV ILLUSTRATIONS & 79
EXERCISES
7. UNIT – V ILLUSTRATIONS & 85
EXERCISES
8. UNIT – VI ILLUSTRATIONS & 103
EXERCISES
9. UNIT – VII ILLUSTRATIONS & 121
EXERCISES
10. UNIT – VIII ILLUSTRATIONS & 129
EXERCISES
11. UNIT – IX ILLUSTRATIONS & 145
EXERCISES
12. COMMERCE BOOK BACK 166
QUESTIONS
13. GOVERNMENT MODEL QUESTION 209
PAPER
Best of
luck!!!!!
www.nammakalvi.in
G.K. VIDHYAA MANDIR MAT. HR. SEC. SCHOOL, KARUR. XII
WORKSHEETS ACCOUNTANCY STD
UNIT 1
ACCOUNTS FROM INCOMPLETE RECORDS
CHOOSE THE CORRECT ANSWER:-
1. Incomplete records are generally maintained by…………………..

(a) A company (b) Government (c) Small sized sole trader business
(d) Multinational enterprises
2. Statement of affairs is a…………………………
(a) Statement of income and expenditure (b) Statement of assets and liabilities
(c) Summary of cash transactions (d) Summary of credit transactions
3. Opening statement of affairs is usually prepared to find out the………….
(a) Capital in the beginning of the year (b) Capital at the end of the year
(c) Profit made during the year (d) Loss occurred during the year
4. The excess of assets over liabilities is………………………..
(a) Loss (b) Cash (c) Capital (d) Profit
5. Which of the following items relating to bills payable is transferred to total
creditors account?
(a) Opening balance of bills payable (b) Closing balance of bills payable
(c) Bills payable accepted during the year (d) Cash paid for bills payable
6. The amount of credit sales can be computed from…………………….
(a) Total debtors account (b) Total creditors account
(c) Bills receivable account (d) Bills payable account
B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

PRINCIPAL . CONTACT: 7708082064 Page 1
7. Which one of the following statements is not true in relation to incomplete

records?
(a) It is an unscientific method of recording transactions
(b) Records are maintained only for cash and personal accounts
(c) It is suitable for all types of organisations
(d) Tax authorities do not accept
8. What is the amount of capital of the proprietor; if his assets are 85,000 and
liabilities are 21,000?
(a) 85,000 (b) 1, 06,000 (c) 21,000 (d) 64,000
9. When capital in the beginning is 10,000, drawings during the year is 6,000,
profit made during the year is 2,000 and the additional capital introduced is 3,000,
find out the amount of capital at the end.
(a) 9,000 (b) 11,000 (c) 21,000 (d) 3,000
10. Opening balance of debtors: ` 30,000, cash received: 1,00,000, credit sales:
90,000; closing balance of debtors is……………………
(a) 30,000 b) 1,30,000 c) 40,000 d) 20,000
UNIT 2
ACCOUNTS OF NOTFORPROFIT ORGANISATION
1. Receipts and payments account is a…………………….

(a) Nominal A/c (b) Real A/c
(c) Personal A/c (d) Representative personal account
2. Receipts and payments account records receipts and payments of…….
(a) Revenue nature only (b) Capital nature only
(c) Both revenue and capital nature (d) None of the above

3. Balance of receipts and payments account indicates the…………

(a) Loss incurred during the period
(b) Excess of income over expenditure of the period
(c) Total cash payments during the period
(d) Cash and bank balance as on the date
4. Income and expenditure account is a………………………
(a) Nominal A/c (b) Real A/c
(c) Personal A/c (d) Representative personal account
5. Income and Expenditure Account is prepared to find out…………….
(a) Profit or loss (b) Cash and bank balance
(c) Surplus or deficit (d) Financial position
6. Which of the following should not be recorded in the income and expenditure
account?
(a) Sale of old news papers (b) Loss on sale of asset
(c) Honorarium paid to the secretary (d) Sale proceeds of furniture
7. Subscription due but not received for the current year is…………………
(a) An asset (b) A liability
(c) An expense (d) An item to be ignored
8. Legacy is a………………………………..
(a) Revenue expenditure (b) Capital expenditure
(c) Revenue receipt (d) Capital receipt
9. Donations received for a specific purpose is………………….
(a) Revenue receipt (b) Capital receipt
(c) Revenue expenditure (d) Capital expenditure

www.nammakalvi.in
10. There are 500 members in a club each paying 100 as annual subscription.
Subscription due but not received for the current year is 200; Subscription received
in advance is 300. Find out the amount of subscription to be shown in the income
and expenditure account…………….
a) 50,000 b) 50,200 c) 49,900 d) 49,800
UNIT 3
ACCOUNTS OF PARTNERSHIP FIRMS FUNDAMENTALS
1. In the absence of a partnership deed, profits of the firm will be shared by the
partners in………………………………
(a) Equal ratio (b) Capital ratio
(c) Both (a) and (b) (d) None of these
2. In the absence of an agreement among the partners, interest on capital is…….
(a) Not allowed (b) Allowed at bank rate
(c) Allowed @ 5% per annum (d) Allowed @ 6% per annum
3. As per the Indian Partnership Act, 1932, the rate of interest allowed on loans
advanced by partners is……………………………
(a) 8% per annum (b) 12% per annum
(c) 5% per annum (d) 6% per annum
4. Which of the following is shown in Profit and loss appropriation account?
(a) Office expenses (b) Salary of staff
(c) Partners’ salary (d) Interest on bank loan

5. When fixed capital method is adopted by a partnership firm, which of the

following items will appear in capital account?
(a) Additional capital introduced (b) Interest on capital
(c) Interest on drawings (d) Share of profit
6. When a partner withdraws regularly a fixed sum of money at the middle of
every month, period for which interest is to be calculated on the drawings on an
average is………………………………….
(a) 5.5 moths (b) 6 months (c) 12 months (d) 6.5 months
7. Which of the following is the incorrect pair?
(a) Interest on drawings – Debited to capital account
(b) Interest on capital – Credited to capital account
(c) Interest on loan – Debited to capital account
(d) Share of profit – Credited to capital account
8. In the absence of an agreement, partners are entitled to……………….
(a) Salary (b) Commission
(c) Interest on loan (d) Interest on capital
9. Pick the odd one out………………………………….
(a) Partners share profits and losses equally
(b) Interest on partners’ capital is allowed at 7% per annum
(c) No salary or remuneration is allowed
(d) Interest on loan from partners is allowed at 6% per annum.
10. Profit after interest on drawings, interest on capital and remuneration is 10,500.
Geetha, a partner, is entitled to receive commission @ 5% on profits after charging
such commission. Find out commission………………….
(a) 50 (b) 150 (c) 550 (d) 500

UNIT 4
GOODWILL IN PARTNERSHIP ACCOUNTS
1. Which of the following statements is true?
(a) Goodwill is an intangible asset (b) Goodwill is a current asset
(c) Goodwill is a fictitious asset (d) Goodwill cannot be acquired
2. Super profit is the difference between…………………………
(a) Capital employed and average profit (b) Assets and liabilities
(c) Average profit and normal profit (d) Current year’s profit & average profit
3. The average rate of return of similar concerns is considered as…………….
(a) Average profit (b) Normal rate of return
(c) Expected rate of return (d) None of these
4. Which of the following is true?
(a) Super profit = Total profit / number of years
(b) Super profit = Weighted profit / number of years
(c) Super profit = Average profit – Normal profit
(d) Super profit = Average profit × Years of purchase
5. Identify the incorrect pair………………………
(a) Goodwill under Average profit method - Average profit × Number of years of
purchase
(b) Goodwill under Super profit method - Super profit × Number of years of
purchase
(c) Goodwill under Annuity method - Average profit × Present value annuity factor
(d) Goodwill under Weighted average - Weighted average profit × Number of
years of profit method purchase

www.nammakalvi.in

6. When the average profit is 25,000 and the normal profit is 15,000, super profit
is…………………………….
(a) 25,000 (b) 5,000 (c) 10,000 (d) 15,000
7. Book profit of 2017 is 35,000; non-recurring income included in the profit is
1,000 and abnormal loss charged in the year 2017 was 2,000, then the adjusted
profit is……………………………..
(a) 36,000 (b) 35,000 (c) 38,000 (d) 34,000
8. The total capitalised value of a business is 1,00,000; assets are 1,50,000 and
liabilities are 80,000. The value of goodwill as per the capitalisation method will
be………………………………..
(a) 40,000 (b) 70,000 (c) 1,00,000 (d) 30,000
UNIT 5
ADMISSION OF A PARTNER
1. Revaluation A/c is a………………………………..
(a) Real A/c (b) Nominal A/c (c) Personal A/c (d) Impersonal A/c
2. On revaluation, the increase in the value of assets leads to…………………
(a) Gain (b) Loss (c) Expense (d) None of these
3. The profit or loss on revaluation of assets and liabilities is transferred to the
capital account of………………………………………
(a) The old partners (b) The new partner
(c) All the partners (d) The Sacrificing partners
4. If the old profit sharing ratio is more than the new profit sharing ratio of a
partner, the difference is called………………………….
(a) Capital ratio (b) Sacrificing ratio
(c) Gaining ratio (d) None of these
5. At the time of admission, the goodwill brought by the new partner may be
credited to the capital accounts of…………………….
(a) all the partners (b) the old partners
(c) the new partner (d) the sacrificing partners
6. Which of the following statements is not true in relation to admission of a

partner
(a) Generally mutual rights of the partners change
(b) The profits and losses of the previous years are distributed to the old partners
(c) The firm is reconstituted under a new agreement
(d) The existing agreement does not come to an end
7. Match List I with List II and select the correct answer using the codes given
below:
List I List II
(i) Sacrificing ratio 1. Investment fluctuation fund
(ii) Old profit sharing ratio 2. Accumulated profit
(iii) Revaluation Account 3. Goodwill
(iv) Capital Account 4. Unrecorded liability
Codes:
(i) (ii) (iii) (iv)
(a) 1 2 3 4
(b) 3 2 4 1
(c) 4 3 2 1
(d) 3 1 4 2

8. Select the odd one out…………………………….

(a) Revaluation profit (b) Accumulated loss
(c) Goodwill brought by new partner (d) Investment fluctuation fund
9. James and Kamal are sharing profits and losses in the ratio of 5:3. They admit
Sunil as a partner giving him 1/5 share of profits. Find out the sacrificing ratio.
(a) 1:3 (b) 3:1 (c) 5:3 (d) 3:5
10. Balaji and Kamalesh are partners sharing profits and losses in the ratio of 2:1.
They admit Yogesh into partnership. The new profit sharing ratio between Balaji,
Kamalesh and Yogesh is agreed to 3:1:1. Find the sacrificing ratio between Balaji
and Kamalesh.
(a) 1:3 (b) 3:1 (c) 2:1 (d) 1:2
UNIT 6
RETIREMENT AND DEATH OF A PARTNER
1. A partner retires from the partnership firm on 30th June. He is liable for all
the acts of the firm up to the……………………………
(a) End of the current accounting period
(b) End of the previous accounting period
(c) Date of his retirement
(d) Date of his final settlement
2. On retirement of a partner from a partnership firm, accumulated profits and
losses are distributed to the partners in the…………………………
(a) New profit sharing ratio (b) Old profit sharing ratio
(c) Gaining ratio (d) Sacrificing ratio

3. On retirement of a partner, general reserve is transferred to the…………….

(a) Capital account of all the partners
(b) Revaluation account
(c) Capital account of the continuing partners
(d) Memorandum revaluation account
4. On revaluation, the increase in liabilities leads to…………………………..
(a) Gain (b) Loss (c) Profit (d) None of these
5. At the time of retirement of a partner, determination of gaining ratio is
required…………………………………
(a) To transfer revaluation profit or loss
(b) To distribute accumulated profits and losses
(c) To adjust goodwill
(d) None of these
6. If the final amount due to a retiring partner is not paid immediately, it is
transferred to……………………………………
(a) Bank A/c (b) Retiring partner’s capital A/c
(c) Retiring partner’s loan A/c (d) Other partners’ capital A/c
7. ‘ A’ was a partner in a partnership firm. He died on 31st March 2019. The final
amount due to him is 25,000 which is not paid immediately. It will be transferred
to………………………………………
(a) A’s capital account (b) A’s current account
(c) A’s Executor account (d) A’s Executor loan account

www.nammakalvi.in
8. A, B and C are partners sharing profits in the ratio of 2:2:1. On retirement of B,

goodwill of the firm was valued as 30,000. Find the contribution of A and C to
compensate B:
(a) 20,000 and 10,000 (b) 8,000 and 4,000
(c) 10,000 and 20,000 (d) 15,000 and 15,000
9. A, B and C are partners sharing profits in the ratio of 4:2:3. C retires. The new
profit sharing ratio between A and B will be……………………..
(a) 4:3 (b) 3:4 (c) 2:1 (d) 1:2
10. X, Y and Z were partners sharing profits and losses equally. X died on 1st
April 2019. Find out the share of X in the profit of 2019 based on the profit of
2018 which showed 36,000……………
(a) 1,000 (b) 3,000 (c) 12,000 (d) 36,000
UNIT 7
COMPANY ACCOUNTS
1. A preference share is one…………………………………….
(i) which carries preferential right with respect to payment of dividend fixed rate
(ii) which carries preferential right with respect to repayment of capital on winding
up
(a) Only (i) is correct (b) Only (ii) is correct
(c) Both (i) and (ii) are correct (d) Both (i) and (ii) are incorrect
2. That part of share capital which can be called up only on the winding up of a
company is called…………………………….
(a) Authorised capital (b) Called up capital
(c) Capital reserve (d) Reserve capital

3. At the time of forfeiture, share capital account is debited with………..

(a) Face value (b) Nominal value
(c) Paid up amount (d) Called up amount
4. After the forfeited shares are reissued, the balance in the forfeited shares account
should be transferred to……………………..
(a) General reserve account (b) Capital reserve account
(c) Securities premium account (d) Surplus account
5. The amount received over and above the par value is credited to…………
(a) Securities premium account (b) Calls in advance account
(c) Share capital account (d) Forfeited shares account
6. Which of the following statement is false?
(a) Issued capital can never be more than the authorised capital
(b) In case of under subscription, issued capital will less than subscribed capital
(c) Reserve capital can be called at the time of winding up
(d) Paid up capital is part of called up capital
7. When shares are issued for purchase of assets, amount should be credited to...
(a) Vendor’s A/c (b) Sundry assets A/c
(c) Share capital A/c (d) Bank A/c
8. Match the pair and identify the correct option………………..
(1) Under subscription - (i) Amount prepaid for calls
(2) Over subscription - (ii) Subscription above the offered shares
(3) Calls in arrear - (iii) Subscription below the offered shares
(4) Calls in advance - (iv) Amount unpaid on calls
(1) (2) (3) (4)
(a) (i) (ii) (iii) (iv)

(b) (iv) (iii) (ii) (i)

(c) (iii) (ii) (iv) (i)
(d) (iii) (iv) (i) (ii)
9. If a share of 10 on which 8 has been paid up is forfeited. Minimum reissue price
is………………………
(a) 10 per share (b) 8 per share
(c) 5 per share (d) 2 per share
10. Supreme Ltd. forfeited 100 shares of 10 each for non-payment of final call of
2 per share. All these shares were re-issued at 9 per share. What amount will be
transferred to capital reserve account?
(a) 700 (b) 800 (c) 900 (d) 1,000
UNIT 8
FINANCIAL STATEMENT ANALYSIS
1. Which of the following statements is not true?
a) Notes and schedules also form part of financial statements.
b) The tools of financial statement analysis include common-size statement
c) Trend analysis refers to the study of movement of figures for one year
d) The common–size statements show the relationship of various items with some
common base, expressed as percentage of the common base
2. Balance sheet provides information about the financial position of a business
concern…………………………….
a) Over a period of time b) As on a particular date
c) For a period of time d) For the accounting period

3. Which of the following tools of financial statement analysis is suitable when

data relating to several years are to be analysed?
a) Cash flow statement b) Common size statement
c) Comparative statement d) Trend analysis
4. The financial statements do not exhibit…………………
a) Non-monetary data b) Past data c) Short term data d) Long term data
5. Which of the following is not a tool of financial statement analysis?
a) Trend analysis b) Common size statement
c) Comparative statement d) Standard costing
6. The term ‘fund’ refers to…………………..
a) Current liabilities b) Working capital c) Fixed assets d) Non-current assets
7. Which of the following statements is not true?
a) All the limitations of financial statements are applicable to financial statement
analysis also.
b) Financial statement analysis is only the means and not an end.
c) Expert knowledge is not required in analysing the financial statements.
d) Interpretation of the analysed data involves personal judgement.
8. A limited company’s sales has increased from 1,25,000 to 1,50,000. How does
this appear in comparative income statement?
a) + 20 % b) + 120 % c) – 120 % d) – 20 %
9. In a common-size balance sheet, if the percentage of non-current assets is 75,

what would be the percentage of current assets?
a) 175 b) 125 c) 25 d) 100

www.nammakalvi.in

10. Expenses for a business for the first year were 80,000. In the second year, it
was increased to 88,000. What is the trend percentage in the second year?
a) 10 % b) 110 % c) 90 % d) 11%
UNIT 9
RATIO ANALYSIS
1. The mathematical expression that provides a measure of the relationship

between two figures is called………………………..
(a) Conclusion (b) Ratio (c) Model (d) Decision
2. Current ratio indicates…………………
(a) Ability to meet short term obligations (b) Efficiency of management
(c) Profitability (d) Long term solvency
3. Current assets excluding inventory and prepaid expenses is called………
(a) Reserves (b) Tangible assets (c) Funds (d) Quick assets
4. Debt equity ratio is a measure of………………………
(a) Short term solvency (b) Long term solvency
(c) Profitability (d) Efficiency
5. Match List I with List II and select the correct answer using the codes given
below:
List I List II
(i) Current ratio 1. Liquidity
(ii) Net profit ratio 2. Efficiency
(iii) Debt-equity ratio 3. Long term solvency
(iv) Inventory turnover ratio 4. Profitability

Codes:
(i) (ii) (iii) (iv)
(a) 1 4 3 2
(b) 3 2 4 1
(c) 4 3 2 1
(d) 1 2 3 4
6. To test the liquidity of a concern, which of the following ratios are useful?
(i) Quick ratio (ii) Net profit ratio
(iii) Debt-equity ratio (iv) Current ratio
Select the correct answer using the codes given below:
(a) (i) and (ii) (b) (i) and (iv) (c) (ii) and (iii) (d) (ii) and (iv)
7. Proportion of share holder's funds to total assets is called…………………….
(a) Proprietary ratio (b) Capital gearing ratio
(c) Debt equity ratio (d) Current ratio
8. Which one of the following is not correctly matched?
(a) Liquid ratio – Proportion (b) Gross profit ratio – Percentage
(c) Fixed assets turnover ratio – Percentage (d) Debt-equity ratio – Proportion
9. Current liabilities 40,000; Current assets 1,00,000 ; Inventory 20,000 . Quick
ratio is…………………………..
(a) 1:1 (b) 2.5:1 (c) 2:1 (d) 1:2
10. Cost of revenue from operations 3,00,000; Inventory in the beginning of the
year 60,000; Inventory at the close of the year 40,000. Inventory turnover ratio..
(a) 2 times (b) 3 times (c) 6 times (d) 8 times

UNIT 10
COMPUTERISED ACCOUNTING SYSTEM-TALLY
1. Accounting report prepared according to the requirements of the user is……...
(a) Routine accounting report (b) Special purpose report
(c) Trial balance (d) Balance sheet
2. Function key F11 is used for…………………………..
(a) Company Features (b) Accounting vouchers
(c) Company Configuration (d) None of these
3. Which submenu displays groups, ledgers and voucher types in Tally?
(a) Inventory vouchers (b) Accounting vouchers
(c) Company Info (d) Account Info
4. What are the predefined Ledger(s) in Tally?
(i) Cash (ii) Profit & Loss A/c (iii) Capital A/c
(a) Only (i) (b) Only (ii) (c) Both (i) and (ii) (d) Both (ii) and (iii)
5. Contra voucher is used for………………..
(a) Master entry (b) Withdrawal of cash from bank for office use
(c) Reports (d) Credit purchase of assets
6. Which is not the default group in Tally?
(a) Suspense account (b) Outstanding expense
(c) Sales account (d) Investments
7. Salary account comes under which of the following head?
(a) Direct Incomes (b) Direct Expenses
(c) Indirect Incomes (d) Indirect Expenses

8. ` 25,000 withdrawn from bank for office use. In which voucher type, this
transaction will be recorded…………………………..
(a) Contra Voucher (b) Receipt Voucher
(c) Payment Voucher (d) Sales Voucher
9. In which voucher type credit purchase of furniture is recorded in Tally
(a) Receipt voucher (b) Journal voucher
(c) Purchase voucher (d) Payment voucher
10. Which of the following options is used to view Trial Balance from Gateway of
Tally?
(a) Gateway of Tally -> Reports -> Trial Balance
(b) Gateway of Tally -> Trial Balance
(c) Gateway of Tally -> Reports -> Display -> Trial Balance
(d) None of these

www.nammakalvi.in

UNIT 1
I .Very short answer questions
1. What is meant by incomplete records?
2. State the accounts generally maintained by small sized sole trader when double
entry accounting system is not followed.
3. What is a statement of affairs?
II. Short answer questions
1. What are the features of incomplete records?
2. What are the limitations of incomplete records?
3. State the differences between double entry system and incomplete records.
4. State the procedure for calculating profit or loss through statement of affairs.
5. Differentiate between statement of affairs and balance sheet.
6. How is the amount of credit sale ascertained from incomplete records?
UNIT 2
ACCOUNTS OF NOT FOR PROFIT ORGANISATION
I) Very short answer questions
1. State the meaning of not–for–profit organisation.
2. What is receipts and payments account?
3. What is legacy?

4. Write a short note on life membership fees.
5. Give four examples for capital receipts of not–for–profit organisation.
6. Give four examples for revenue receipts of not–for–profit organisation.
II) Short answer questions
1. What is income and expenditure account?
2. State the differences between Receipts and Payments Account and Income and
Expenditure Account.
3. How annual subscription is dealt with in the final accounts of not–for–profit

organisation?
4. How the following items are dealt with in the final accounts of not–for–profit
organisation?
a) Sale of sports materials b) Life membership fees c) Tournament fund
UNIT 3
I . Very short answer questions
1. Define partnership.
2. What is a partnership deed?
3. What is meant by fixed capital method?
4. What is the journal entry to be passed for providing interest on capital to a

partner?
5. Why is Profit and loss appropriation account prepared?

1. State the features of partnership.
2. State any six contents of a partnership deed.
3. State the differences between fixed capital method and fluctuating capital
method.
4. Write a brief note on the applications of the provisions of the Indian Partnership
Act, 1932 in the absence of partnership deed.
UNIT 4
1. What is goodwill?
2. What is acquired goodwill?
3. What is super profit?
4 What is normal rate of return?
5 State any two circumstances under which goodwill of a partnership firm is

valued.
II . Short answer questions
1. State any six factors determining goodwill.
2. How is goodwill calculated under the super profits method?
3. How is the value of goodwill calculated under the capitalisation method?

UNIT 5
ADMISSION OF A PARTNER
I. Very short answer questions
1. What is meant by revaluation of assets and liabilities?
2. How are accumulated profits and losses distributed among the partners at the
time of admission of a new partner?
3. What is sacrificing ratio?
4. Give the journal entry for writing off existing goodwill at the time of admission
of a new partner.
5. State whether the following will be debited or credited in the revaluation

account.
(a) Depreciation on assets (b) Unrecorded liability
(c) Provision for outstanding expenses (d) Appreciation of assets
1. What are the adjustments required at the time of admission of a partner?
2. What are the journal entries to be passed on revaluation of assets and liabilities?
3. Write a short note on accounting treatment of goodwill.
UNIT 6
1. What is meant by retirement of a partner?
2. What is gaining ratio?

3. What is the purpose of calculating gaining ratio?
4. What is the journal entry to be passed to transfer the amount due to the deceased
partner to the executor of the deceased partner?
1. List out the adjustments made at the time of retirement of a partner in a

partnership firm.
2. Distinguish between sacrificing ratio and gaining ratio.
3. What are the ways in which the final amount due to an outgoing partner can be
settled?
UNIT 7
COMPANY ACCOUNTS
1. What is a share?
2. What is over-subscription?
3. What is meant by calls in arrear?
4. Write a short note on securities premium account.
5. Why are the shares forfeited?
1. State the differences between preference shares and equity shares.
2. Write a brief note on calls in advance.
3. What is reissue of forfeited shares?
4. Write a short note on (a) Authorised capital (b) Reserve capital
5. What is meant by issue of shares for consideration other than cash?

www.nammakalvi.in

UNIT 8
1. What are financial statements?
2. List the tools of financial statement analysis.
3. What is working capital?
4. When is trend analysis preferred to other tools?
1. ‘Financial statements are prepared based on the past data’. Explain how this is a
limitation.
2. Write a short note on cash flow analysis.
3. Briefly explain any three limitations of financial statements.
4. Explain the steps involved in preparing comparative statement.
5. Explain the procedure for preparing common-size statement.
UNIT 9
RATIO ANALYSIS
1. What is meant by accounting ratios?
2. What is quick ratio?
3. What is meant by debt equity ratio?

4. What does return on investment ratio indicate?
5. State any two limitations of ratio analysis.
1. Explain the objectives of ratio analysis.
2. What is inventory conversion period? How is it calculated?
3. How is operating profit ascertained?
4. State any three advantages of ratio analysis.
5. Bring out the limitations of ratio analysis.
UNIT 10
COMPUTERISED ACCOUNTING SYSTEM-TALLY
1. What is automated accounting system?
2. What are accounting reports?
3. State any five accounting reports.
4. What is Accounting Information System (AIS)?
5. What is a group in Tally.ERP 9?
1. Write a brief note on accounting vouchers.
2. What are the pre-defined ledgers available in Tally.ERP 9?
3. Mention the commonly used voucher types in Tally.ERP 9.
4. Explain how to view prot and loss statement in Tally.ERP 9.
5. Explain any five applications of computerised accounting system.

UNIT 1

STD: XII
ILLUSTRATIONS:
1. From the following particulars ascertain profit or loss:

Capital at the beginning of the year (1st April, 2016) 2,00,000
Capital at the end of the year (31st March, 2017) 3,50,000
Additional capital introduced during the year 70,000
Drawings during the year 40,000

Capital as on 1st April 2018 1,60,000
Capital as on 31st March, 2019 1,50,000
Drawings made during the year 30,000
3. From the following details, calculate the missing figure.

Closing capital as on 31.3.2019 1,90,000
Opening capital on 1.4.2018 ?
Loss for the year ending 31.3.2019 40,000
4. From the following details, calculate the capital as on 31st December 2018:
Capital as on 1st January, 2018 27,500
Goods taken for the personal use of the proprietor 5,000
Profit for the year 10,000
5. From the following details, calculate the missing figure:

Capital as on 1st April, 2017 2,50,000
Capital as on 31st March, 2018 2,75,000
Drawings during the year ?

6. Following are the balances of Shanthi as on 31st December 2018.
Particulars Amount Particulars Amount
Bills receivable 6,000 Sundry creditors 25,000
Bills payable 4,000 Stock 45,000
Machinery 60,000 Debtor 70,000
Furniture 10,000 Cash 4,000
Prepare a statement of affairs as on 31 st December 2018 and calculate capital as

at that date.
7. On 1st April 2017, Ganesh started his business with a capital of ` 75,000. He
did not maintain proper book of accounts. Following particulars are available from
his books as on 31.03.2018.
Cash 5,000 Land and buildings 30,000
Stock of goods 18,000 Debtors 16,000
Bills receivable 7,000 Creditors 9,000
Furniture 3,000 Cash at bank 24,000
Bills payable 6,000
During the year he withdrew 15,000 for his personal use. He introduced further
capital of 20,000 during the year. Calculate his profit or loss.

8. David does not keep proper books of accounts. Following details are given
from his records.
Particulars 1.4.2018 31.3.2019
Cash 43,000 29,000
Stock of goods 1,20,000 1,30,000
Sundry debtors 84,000 1,10,000
Sundry creditors 1,05,000 1,02,000
Loan 25,000 20,000
Business premises 2,50,000 2,50,000
Furniture 33,000 45,000
During the year he introduced further capital of 45,000 and withdrew 2,500 per
month from the business for his personal use. Prepare statement of profit or loss
with the above information.
9. Ahmed does not keep proper books of accounts. Find the profit or loss made
by him for the year ending 31st March, 2018.
Particulars 1.4.2018 31.3.2019
Bank balance 14,000 (Cr.) 18,000 (Dr.)
Cash in hand 800 1,500
Stock 12,000 16,000
Debtors 34,000 30,000
Plant 80,000 80,000
Furniture 40,000 40,000
Creditors 60,000 72,000

www.nammakalvi.in

Ahmed had withdrawn 40,000 for his personal use. He had introduced 16,000 as
capital for expansion of his business. A provision of 5% on debtors is to be made.
Plant is to be depreciated at 10%.
10. Find out credit sales from the following information:

Debtors on 1st January 2018 40,000
Cash received from debtors 1,00,000
Discount allowed 5,000
Sales returns 2,000
Debtors on 31st December 2018 60,000
11. From the following details find out total sales made during the year.
Debtors on 1st April 2018 50,000
Cash received from debtors during the year 1,50,000
Returns inward 15,000
Bad debts 5,000
Debtors on 31st March 2019 70,000
Cash Sales 1,40,000
12. From the following particulars, prepare bills receivable account and compute
the bills received from the debtors.
Opening bills receivable 20,000
Closing bills receivable 30,000
Cash received for bills receivable 60,000
Bills receivable dishonoured 5,000
13. From the following particulars, calculate total sales.

Debtors on 1st April 2017 1,50,000
Bills receivable on 1st April 2017 40,000
Sales return 40,000
Bills receivable on 31st March, 2018 30,000
Sundry debtors on 31st March, 2018 1,30,000
Cash sales 2,00,000

14. From the following details, calculate credit purchases.

Creditors on 1st April, 2018 50,000
Returns outward 6,000
Cash paid to creditors 1,60,000
Creditors on 31st March, 2019 70,000
15. From the following particulars calculate total purchases.

Sundry creditors on 1st April, 2017 75,000
Bills payable on 1st April, 2017 60,000
Paid cash to creditors 3,70,000
Paid for bills payable 1,00,000
Purchases returns 15,000
Cash purchases 3,20,000
Creditors on 31st March, 2018 50,000
Bills payable on 31st March, 2018 80,000
16. From the following details you are required to calculate credit sales and credit
purchases by preparing total debtors account, total creditors account, bills
receivable account and bills payable account.
Particulars Opening Closing
Debtors 60,000 55,000
Bills receivable 5,000 1,000
Creditors 25,000 28,000
Bills payable 2,000 3,000
Other information:
Discount allowed to customers 5,500
Cash paid to creditors 70,000
Discount allowed by suppliers 3,500
Payments against bill payable 7,000
Bad debts 3,500

17. From the following details of Abdul who maintains incomplete records,
prepare Trading and Profit and Loss account for the year ended 31 st March, 2018
and a Balance Sheet as on the date.
Particulars 1.4.2017 31.3.2018
Stock 1,00,000 50,000
Sundry debtors 2,50,000 3,50,000
Cash 25,000 40,000
Furniture 10,000 10,000
Other details:
Drawings 40,000 Cash received from debtors 5,35,000
Discount received 20,000 Sundry expenses 30,000
Discount allowed 25,000 Capital as on 1.4.2017 2,35,000
18. Bharathi does not maintain her books of accounts under double entry system.
From the following details prepare trading and profit and loss account for the year
ending 31st March, 2019 and a balance sheet as on that date.
Dr. Cash Book Cr.

Receipts Amount Payments Amount
To balance b/d 32,000 By Purchases A/c 56,000
To Sales A/c 1,60,000 By Creditors A/c 80,000
To Debtors A/c 1,20,000 By General expenses 24,000

A/c
By Wages A/c 10,000
By Balance c/d 1,42,000
3,12,000 3,12,000

Other information:
Particulars 1.4.2018 31.3.2019
Stock of goods 40,000 60,000
Debtors 38,000 ?
Creditors 58,000 52,000
Machinery 1,70,000 1,70,000
Additional information:
(i) Credit purchases 74,000
(ii) Credit sales 1,40,000
(iii) Opening capital 2,22,000
(iv) Depreciate machinery by 10% p.a.
19. Arjun carries on grocery business and does not keep his books on double
entry basis. The following particulars have been extracted from his books:
Particulars 1.4.2018 31.3.2019
Plant and machinery 20,000 20,000
Stock 9,000 16,000
Sundry debtors 2,000 5,300
Sundry creditors 5,000 4,000
Cash at bank 4,000 6,000

Other information for the year ending 31-3-2019 showed the following:
Advertising 4,700
Carriage inwards 8,000
Cash paid to creditors 64,000
Drawings 2,000
Total sales during the year were ` 85,000. Purchases returns during the year
were ` 2,000 and sales returns were ` 1,000. Depreciate plant and machinery by
5%. Provide ` 300 for doubtful debts. Prepare trading and profit and loss account
for the year ending 31st March, 2019 and a balance sheet as on the date.
20. Pandian does not keep his books under double entry system. From the
following information. prepare trading and profit and loss account and balance
sheet as on 31-12-2018.
Particulars 1.1.2018 31.12.2018
Furniture 30,000 30,000
Cash in hand 10,000 17,000
Debtors 40,000 60,000
Stock 28,000 11,000
Bank loan 25,000 25,000
Creditors 15,000 16,000
Cash sales 11,200 Credit sales 88,800

Cash purchases 4,250 Credit purchases 35,750
Carriage on purchases 3,000 Carriage on sales 700
Commission received 600 Interest on bank loan 2,500
Drawings 8,000 Additional capital 14,000
Salaries 8,900 Office rent 2,400
Adjustments:
Write off depreciation of 5% on furniture. Create a provision of 1% on debtors for
doubtful debts.

www.nammakalvi.in

EXERCISE PROBLEMS
Capital at the beginning of the year (1st April, 2018) 5,00,000
Capital at the end of the year (31st March, 2019) 8,50,000
Additional capital introduced during the year 1,20,000
2. From the following particulars ascertain profit or loss

Capital as on 1st January 2018 2,20,000
Capital as on 31st December 2018 1,80,000
Drawings made during the year 50,000
3. From the following details, calculate the missing figure.

Closing capital as on 31.3.2018 80,000
Opening capital on 01.4.2017 ?
Loss for the year ending 31.3.2018 25,000
4. From the following details, calculate the capital as on 31st December 2018.
Capital as on 1st January, 2018 1,00,000
Goods withdrawn for personal use by the owner 30,000
5. From the following details, calculate the missing figure:

Capital as on 1st April, 2018 40,000
Capital as on 31st March, 2019 50,000
Drawings during the year ?
6. Following are the balances in the books of Thomas as on 31st March 2019.
Sundry creditors 6,00,000 Bills payable 1,20,000
Furniture 80,000 Cash in hand 20,000
Land and building 3,00,000 Bills receivable 60,000
Sundry Debtors 3,20,000 Stock 2,20,000
Prepare a statement of affairs as on 31st March 2019 and calculate capital as at
that date.

7. On 1st April 2018 Subha started her business with a capital of 1,20,000. She
did not maintain proper book of accounts. Following particulars are available from
her books as on 31.3.2019.
Bank overdraft 50,000 Stock-in-trade 1,60,000
Debtors 1,80,000 Creditors 90,000
Bills receivable 70,000 Bills payable 2,40,000
Computer 30,000 Cash in hand 60,000
Machinery 3,00,000
During the year she withdrew 30,000 for her personal use. She introduced
further capital of 40,000 during the year. Calculate her profit or loss.
8. Raju does not keep proper books of accounts. Following details are taken from
his records.
Particulars 1.1.2018 31.12.2018
Cash at bank 80,000 90,000
Stock of goods 1,80,000 1,40,000
Debtors 90,000 2,00,000
Bank Loan 60,000 60,000
Plant and machinery 1,70,000 1,70,000
During the year he introduced further capital of 50,000 and withdrew 2,500 per
month from the business for his personal use. Prepare statement of profit or loss
with the above information.

9. Ananth does not keep his books under double entry system. Find the profit or
loss made by him for the year ending 31st March, 2019.
Particulars 31.3.2018 31.3.2019
Cash at bank 5,000 (Dr.) 60,000 (Cr.)
Cash in hand 3,000 4,500
Stock of goods 35,000 45,000
Sundry Debtors 1,00,000 90,000
Plant and Machinery 80,000 80,000
Land and Buildings 1,40,000 1,40,000
Sundry Creditors 1,70,000 1,30,000
Ananth had withdrawn 60,000 for his personal use. He had introduced 17,000
as capital for expansion of his business. Create a provision of 5% on debtors.
Plant and machinery is to be depreciated at 10%.
10. Find out credit sales from the following information:

Debtors on 1st April, 2018 1,00,000
Discount allowed 5,000
Returns inward 25,000
Debtors on 31st March 2019 1,20,000
11. From the following details find out total sales made during the year.
Debtors on 1st January 2018 1,30,000
Cash received from debtors during the year 4,20,000
Sales returns 35,000
Bad debts 15,000
Debtors on 31st December 2018 2,00,000
Cash Sales 4,60,000

12. From the following particulars, prepare bills receivable amount and compute
the bills received from the debtors.
Bills receivable at the beginning of the year 1,40,000
Bills receivable at the end of the year 2,00,000
Cash received for bills receivable 3,90,000
13. From the following particulars, calculate total sales.

Debtors on 1st April 2018 2,50,000 Bills receivable dishonoured 5,000
Bills receivable on 1st April 2018 60,000 Returns inward 50,000
Cash received from debtors 7,25,000 Bills receivable on 31st March, 2019 90,000
Cash received for bills receivable 1,60,000 Sundry debtors on 31st March, 2012,40,000
Bad debts 30,000 Cash sales 3,15,000
14. From the following details, calculate credit purchases.

Opening creditors 1,70,000
Purchase returns 20,000
Closing creditors 1,90,000
15. From the following particulars calculate total purchases.

Sundry creditors on 1st January, 2018 30,000
Purchases returns 15,000
Bills payable on 1st January, 2018 25,000
Cash purchases 2,25,000
Paid cash to creditors 1,20,000
Creditors on 31st December, 2018 25,000
Paid for bills payable 30,000
Bills payable on 31st December, 2018 20,000
16. From the following details you are required to calculate credit sales and credit
purchases by preparing total debtors account, total creditors account, bills
receivable account and bills payable account.
Particulars 1.4.2018 31.3.2019
Sundry Debtors 2,40,000 2,20,000

Other
information
:
www.nammakalvi.in


Payments against bill payable 30,000
Discount allowed to customers 25,000
Discount allowed by suppliers 10,000
Bad debts 16,000
17. From the following details of Rakesh, prepare Trading and Profit and Loss
account for the year ended 31st March, 2019 and a Balance Sheet as on that
date.
Particulars 31.3.2018 31.3.2019
Stock of goods 2,20,000 1,60,000
Debtors 5,30,000 6,40,000
Cash at bank 60,000 10,000
Machinery 80,000 80,000
Other details:
Rent paid 1,20,000 Cash received from debtors 12,50,000
Discount received 35,000 Drawings 1,00,000
Discount allowed 25,000 Cash sales 20,000
Cash paid to creditors 11,00,000 Capital as on 1.4.2018 5,20,000

18. Mary does not keep her books under double entry system. From the following
details prepare trading and profit and loss account for the year ending 31st March,
2019 and a balance sheet as on that date.
Dr. Cash Book Cr.

To balance b/d 1,20,000 By Purchases A/c 1,50,000
To Sales A/c 3,60,000 By Creditors A/c 2,50,000
To Debtors A/c 3,40,000 By sundry expensesA/c 1,27,000
By Wages A/c 70,000
By Balance c/d 2,23,000
8,20,000 8,20,000
Other information:
Particulars 1.4.2018 31.3.2019
Stock of goods 1,10,000 1,80,000
Debtors 1,30,000 ?
Creditors 1,60,000 90,000
Furniture and fittings 80,000 80,000
Credit purchases 1,80,000
Credit sales 2,90,000
Opening capital 2,80,000
Depreciate furniture and fittings by 10% p.a.

19. Arun carries on hardware business and does not keep his books on double
entry basis. The following particulars have been extracted from his books:.
Particulars 1.4.2018 31.3.2019
Land and building 2,40,000 2,40,000
Stock 1,20,000 1,70,000
Sundry debtors 40,000 51,500
Sundry creditors 50,000 45,000
Cash at bank 30,000 53,000
Other information for the year ending 31.12.2018 showed the following:
Wages 65,000
Carriage outwards 7,500
Sundry expense 28,000
Drawings 10,000
Total sales during the year were 7,70,000. Purchases returns during the year
were 30,000 and sales returns were 25,000. Depreciate land and buildings by
5%. Provide 1,500 for doubtful debts. Prepare trading and profit and loss account
for the year ending 31st December, 2018 and a balance sheet as on that date.

20. Selvam does not keep his books under double entry system. From the
following information prepare trading and Profit and loss A/c and Balance Sheet
as on 31-12-2018
Particulars 1.1.2018 31.12.2018
Machinery 60,000 60,000
Cash at bank 25,000 33,000
Debtors 70,000 1,00,000
Stock 45,000 22,000
Bank loan 45,000 45,000
Creditors 25,000 21,000
Cash sales 20,000 Credit sales 1,80,000

Cash purchases 8,000 Credit purchases 52,000
Wages 6,000 Salaries 23,500
Advertisement 7,000 Interest on bank loan 4,500
Drawings 60,000 Additional capital 21,000
Adjustments:
Write off depreciation of 10% on machinery. Create a reserve of 1% on debtors
for doubtful debts.

UNIT 2
ACCOUNTS OF NOT FOR PROFIT ORGANISATION
STD: XII
ILLUSTRATIONS:
1. From the following particulars of Tamil Educational Society, prepare Receipts

and Payments account for the year ended 31st March, 2019.
Opening cash balance as on 1.4.2018 18,000 Building purchased 2,10,000
Rent paid 6,000 Staff salary 55,000
Scholarship given 15,200
Subscription received 2,65,000
Entrance fees received 18,500
2. From the following particulars of Trichy Educational Society, prepare Receipts

and Payments account for the year ended 31st December, 2018.
Opening cash balance as on 1.1.2018 20,000
Locker rent received 12,000
Investments made 80,000
Sale of furniture 5,000
Honorarium paid 3,000
General expenses 7,000
Donation received 80,000
Postage 1,000
Audit fees paid 2,000
Subscription received 10,000

3. From the following particulars of Chennai Sports Club, prepare Receipts and
Payments account for the year ended 31st March, 2018.
Particulars Amount Particulars Amount Amount
Opening cash balance as on 10,000 Subscriptions

1.4.2017 received
Opening bank balance as on 15,000 2016 – 2017 4,500

1.4.2017
Interest paid 5,000 2017 – 2018 65,000
Telephone expenses 7,000 2018 - 2019 5,000 74,500
Upkeep of grounds 22,500 Tournament expenses 12,500
Life membership fees received 5,500 Tournament fund 15,000

receipts
Bats and balls purchased 13,000 Closing balance of 5,000

cash (31.3.2018)
4. From the following particulars of Poompuhar Literary Association, prepare

Receipts and Payments account for the year ended 31st March, 2019.
Opening cash balance as on 5,000 Subscriptions received 20,000

1.4.2018
Bank overdraft as on 1.4.2018 4,000 Repairs and renewals 2,500
Interest paid 3,250 Conveyance paid 2,750
Purchase of refreshments 1,500 Books purchased 10,000
Outstanding salary 2,000 Insurance premium paid 4,000
Endownment fund receipts 2,000 Sundry receipts 750

www.nammakalvi.in

Lighting charges 1,300 Government grants received 6,000
Printing and stationery 1,500 Sale of refreshments 1,500
Sale of investments 1,000 Depreciation on buildings 2,000
Cash at bank on 31.03.2019 2,000
5. From the following particulars of Vellore Recreation Club, prepare Receipts

and Payments account for the year ended 31st March, 2017.
Particulars Amoun Particulars Amount

t
Opening cash balance as on 3,000 Receipts from 20,000

1.4.2016 entertainment
Opening bank balance as on 12,000 Admission fees received 1,000

1.4.2016
Furniture purchased 11,000 Municipal taxes 22,000
Sports equipment purchased 11,000 Expenses of charity show 2,000
Donation received for pavilion 8,000 Billiards table purchased 15,000
Sale of old tennis balls 1,500 Construction of new 18,000

tennis court
Newspapers bought 500 Receipts from charity 2,500

show
Travelling expenses 4,500 Closing balance of cash 8,000

6. From the following Receipts and Payment Account of Ooty Recreation Club,
prepare Income and Expenditure Account for the year ended 31.03.2018.

To Opening balance By Sports materials 10,000
purchased
Cash in hand 5,000 By Stationery paid 7,000

To Rent received 10,000 By Computer purchased 25,000
To Sale of investments 8,000 By Salaries 20,000
To Subscription received 54,000 By Closing balance
Cash in hand 15,000

77,000 77,000
7. From the following Receipts and Payment Account of Trichy Recreation Club,
prepare Income and Expenditure Account for the year ended 31.03.2018.

To Opening balance By Furniture purchased 10,000
Cash in hand 11,000 By Rent 2,800
To dividend received 27,600 By Secretary’s honorarium 15,000
To Sale of old newspapers 3,000 By postage 1,700
To Member’s Subscription 31,000 By General expenses 4,350
To locker rent 8,000 By Printing and stationery 45,000
To interest on investments 1,250 By Audit fee 5,000
To Sale of furniture 5,000 By Closing balance 3,000
(Book value ` 4,400) Cash in hand
86,850 86,850

8. From the following details calculate the amount that will be shown as
subscription in Income and Expenditure Account for the year ending 31st March,
2017
Subscription received for Amount
2015-16 7,500
2016-17 60,000
2017-18 1,500
69000
Subscription outstanding for the year 2016-17 is 2,400. Subscription for 2016-17
received in 2015-16 was 1,000.
9. How the following items will appear in the final accounts of a club for the year
ending 31 March, 2019?
st
Dr. Receipts and Payments Account for the year ended 31st March, 2019 Cr.
Receipts Amoun Amoun Payments Amount
t t
To subscription
2017-2018 5,000
2018-2019 48,000
2019-2020 3,000 56,000
There are 300 members in the club each paying an annual subscription of 200
per annum. Subscription still outstanding for the year 2017- 2018 is 1,000.
10. How will the following items appear in the final accounts of a club for the year
ending 31s tMarch 2017? A club received subscription of 25,000 during the year
2016-17. This includes subscription of 2,000 for 2015-16 and 1,500 for the year
2017-18. Subscription of 500 is still outstanding for the year 2016-17.

11. Compute income from subscription for the year 2018 from the following
particulars relating to a club.
Particulars 1.1.2018 31.12.2018
Outstanding subscription 10,000 7,000
Subscription received in advance 3,000 5,000
Subscription received during the year 2018: 1,50,000.
12. From the following particulars, show how the item ‘subscription’ will appear
in the Income and Expenditure Account for the year ended 31-12-2018?
Subscription received in 2018 is 16,000 which includes 3,000 for 2017 and
5,000 for 2019. Subscription outstanding for the year 2018 is 4,000. Subscription
of 2,000 was received in advance for 2018 in the year 2017.
13. How will the following items appear in the final accounts of a sports club?
Particulars
Stock of sports materials (01.04.2018) 3,000
Sports materials purchased during current year 9,000
Sale of old sport materials during current year 500
Stock of sports materials (31.03.2019) 4,000
14. From the following details calculate the printing and stationery to be debited
to Income and Expenditure Account for the year ending 31st March, 2018 and
also show how it will appear in the Balance Sheet as on 31st March, 2018.
Amount paid for stationery during 2017- 2018 1,500
Stock of stationery on 1st April, 2017 300
Stock of stationery on 31st March, 2018 200
15. How will the following appear in the final accounts of a club for the year 2017
–2018?
Particulars
Prize fund on 1.4.2017 60,000
Prize fund investment on 1.4.2017 60,000
Interest received on prize fund investment 6,000
Prizes distributed 8,000
Donation received for prize fund 12,000

16. Compute capital fund of Karur Social Club as on 31.03.2018.
Particulars as on 31.03.2018
Furniture 50,000
Buildings 40,000
Subscription outstanding for 2017-18 10,000
Subscription received in advance for 2018-19 5,000
Loan borrowed 10,000
Investments 20,000
Cash in hand 4,000
Cash at bank 6,000
17. From the following Receipts and Payments Account of Friends Football club,
for the year ending 31st March, 2017, prepare Income and Expenditure Account
for the year ending 31 March, 2017 and the Balance sheet as on that date.
st
In the books of Friends Football Club

Income and Expenditure Account for the year ended 31st March, 2017
Receipts Amoun Amoun Payments Amoun Amount
t t t
To Balance b/d By Furniture 7,000
Cash 1,000 By Sports material 800

purchased
Bank 10,000 11,000 By Special dinner 1,500

expenses
To Subscriptions 5,000 By Electricity charges 900
To Legacies 6,000 By Balance c/d
To Collection for 2,000 Cash in hand 1800

special dinner
Cash at bank 12000 13,800
24,000 24,000

www.nammakalvi.in

(i) The club had furniture of 12,000 on 1 st April 2016. Ignore depreciation on
furniture.
(ii) Subscription outstanding for 2016-2017 600.
(iii) Stock of sports materials on 31.03.2017 100.
(iv) Capital fund as on 1st April 2016 was 23,000.
18. Following is the Receipts and Payments Account of Salem Recreation Club
for the year ended 31st March, 2019.
In the books of Salem Recreation Club

Dr. Receipts and Payments Account for the year ended 31 st March, 2019 Cr.
t t
To Balance b/d By Furniture 15,000
Cash in hand 9,000 By Stationery 2,400
To Subscriptions By Investment 12,500
2018 – 2019 12,500 By Postage 1,000
2019 – 2020 400 12,900 By Balance c/d
To Proceeds from 12,000 Cash in hand 3,500

entertainment
To Sundry receipts 500

34,400 34,400
(i) There are 450 members each paying annual subscription of 30.
(ii) Stock of stationery on 31st March, 2018 ` 300 and on March 31, 2019 500.
(iii) Capital fund as on 1st April 2018 was 9,300.
Prepare income and expenditure account for the year ended 31st March, 2019
and the balance sheet as on that date.

19. From the following Receipts and Payments account of Coimbatore Cricket
Club for the year ending 31st March 2016, prepare income and expenditure
account for the year ending 31 March, 2016 and a balance sheet as on that
st
date.
In the books of Coimbatore Cricket Club

Receipts and Payments Account for the year ending 31 st March, 2016
Receipts Amoun Payments Amount
t
To Balance b/d By Maintenance 5,000
Cash at bank 8,000 By Furniture 15,000
To Subscriptions 11,000 By Tournament expenses 1,400
To Sale of old bats 100 By Secretary’s honorarium 4,500

and balls
To Subscription for 2,000 By Bats and balls 7,400

tournament
Cash at bank 7,800
41,100 41,100
On 1st April, 2015 the club had stock of balls and bats 3,000 and an advance
subscription of 500. Surplus on account of tournament should be kept in reserve
for permanent pavilion. Subscription due on 31.03.2016 was 2,000. Stock of
bats and balls on 31.3.2016 was 1,000.

20. The following is the summary of cash transactions of Delhi Literary Club for
the year ending 31st March, 2019.
Delhi Literary Club

Receipts and Payments Account for the year ending 31 st March, 2019
To Balance b/d By Rents and Rates 21,000
Cash in hand 3,200 By Lecture fees 4,500
To Entrance fees 2,300 By Sundry expenses 7,200
To Subscriptions 46,000 By Fixed deposit 40,000
To Life membership fees 2,500 By Balance c/d
To Interest received on fixed 500 Cash in hand 4,300

deposit
To Sale of furniture 22,500

(on 1.4.2018)
(Book value ` 25,000)
77,000 77,000
Additional information
(a) At the beginning of the year the club possessed books worth 20,000 and
furniture
worth 40,000.
(b) Subscription received in advance during the current year amounted to 1,000.
Prepare Income and Expenditure account of the club for the year ending 31st
March, 2019 and the Balance sheet as on that date.

21. The following is the Receipts and Payments account of Madurai City Club for
the year ending 31st March, 2018.
Madurai City Club

Dr. Receipts and Payments Account for the year ended 31 st March, 2018 Cr.
Receipts Amoun Amoun Payments Amoun Amount
t t t
To Balance b/d By Upkeep of ground 16,500
Cash 500 By Match expenses 19,000
Bank 7,000 7,500 By Sundry expenses 11,000
To Subscriptions 30,000 By Furniture 20,000

(including 4,000 for
2016-2017)
To Hall rent 10,000 Cash in hand 1,500
To Receipts for 22,500 Cash at bank 11,000 12,500

match fund
79,000 79,000
On 1st April, 2017, the club had investment of 40,000. The club also had a credit
balance of 30,000 in Match fund account. On 31st March, 2017 subscriptions in
arrears were 4,000 and the subscriptions in arrears on 31 st March, 2018 were
4,500. Prepare the final accounts.

EXERCISE PROBLEMS
1. From the information given below, prepare Receipts and Payments account of
Kurunji Sports Club for the year ended 31st December, 2018.
Cash in hand (1.1.2018) 4,000 Paid for printing charges 2,500
Salaries paid 3,000 Lockers rent received 1,000
Life membership fees received 10,000 Tournament receipts 14,000
Subscription received 15,000 Tournament expenses 10,500
Rent received 2,000 Investments purchased 25,000
Coimbatore Cricket Club for the year ending 31st March, 2019.
Bank overdraft (1.4.2018) 6,000 Honorarium paid 2,800
Cash in hand (1.4.2018) 1,000 Water and electricity charges 700
Wages paid for ground maintenance 2,000 Match expenses 2,600
Subscription received: Sports material purchased 1,900
Previous year 500 Match fund receipts 5,200
Current year 9,600 Legacies received 2,000
Subsequent year 400 Cash balance (31.03.2019) 300
Wages yet to be paid 2,200
Donation received for pavilion 2,000
Interest on loan paid 2,000
Madurai Mother Theresa Mahalir Mandram for the year ended 31 st December,
2018.
Cash balance as on 1.1.2018 2,000 Fire Insurance premium paid 1,500
Bank balance as on 1.1.2018 3,000 Subscription received 8,500
Sale of old newspapers 500 Furniture purchased 6,000
Stationery purchased 6,000 Purchase of newspapers 700
Audit fees paid 2,000 Depreciation on furniture 900
Entrance fees received 3,000 Cash balance as on 31.12.2018 2,500
Sundry charges 6,000 Conveyance paid 1,000
Scholarships given 2,000 Sale of furniture 4,000
Interest on investments 2,000

4. Mayiladuthurai Recreation Club gives you the following details. Prepare

Receipts and Payments account for the year ended 31st March, 2019.
Opening cash balance 15,000 Salary of watchman 12,000

Opening bank balance 25,000 Club annual day expenses 15,000
Donations received 48,000 Lighting charges 16,500
Sale of old equipment 26,000 Entertainment expenses 13,500
Refreshment charges 13,000 Billiards table purchased 5,000
Club annual day collections 18,000 Expenses of charity show 3,000
Construction of tennis court 7,000 Sale of investments 12,000
Receipts from charity show 4,000 Closing cash balance 12,000
Rent paid 1,000
5. From the following information, prepare Receipts and Payments account of

Cuddalore Kabaddi Association for the year ended 31 st March, 2019.
Opening cash balance (1.4.2018) 11,000 Interest and bank charges 250
Bank overdraft balance (1.4.2018) 20,000 Miscellaneous income 350
Stationery purchased 5,200 Upkeep of ground 550
Travelling expenses 1,800 Grant from Government 12,000
Dividend received 3,000 Telephone charges paid 2,800
General expenses 500 Endowment fund receipts 10,000
Admission fees 4,000 Insurance premium paid 2,000
Courier charges 2,000 Electricity charges paid 5,000
Municipal taxes paid 3,000
Closing cash balance (31.03.2019) 1,750

www.nammakalvi.in

6. From the following receipts and payments account of Tenkasi Thiruvalluvar

Manram, prepare income and expenditure account for the year ended 31st March,
2019.
To Balance b/d By Salaries 20,000
Cash in hand 14,000 By Rent 24,000
To Interest received 5,000 By Travelling expenses 2,000
To Subscription 55,000 By Printing and stationery 6,000
To Legacies 48,000 By Investments made 50,000
To Entrance fees 7,000 By Sports equipment 33,000

purchased
To Sale of furniture 16,000 By Balance c/d
(Book value: ` 17,000)
Cash in hand 10,000
1,45,000 1,45,000

7. From the following receipts and payment account, prepare income and
expenditure account of Kumbakonam Basket Ball Association for the year ended
31st March, 2018.
Receipts Amount Amount Payments Amount Amount
To Balance b/d By Rent of ground 12,000

paid
Cash 23,000 By Printing charges 5,000
Bank 12,000 35,000 By Bank charges 1,000
To Rent of hall 6,000 By Insurance for 2,000

received building
To Subscription 9,000 By Tournament 16,000

received expenses
To Life membership 7,000 By Audit fees 3,000

fees
To Locker rent 2,000 By Sports materials 4,000

received purchased
By Balance c/d
Cash in hand 2,000
Cash at bank 14,000 16,000
59,000 59,000

8. From the following receipts and payments account and the additional
information given below, calculate the amount of subscription to be shown in
Income and expenditure account for the year ending 31 st December, 2018.
Receipts Amount Amount Payments Amount
To subscription
2017 28,000
2018 1,72,000
2019 12,000 2,12,000
Additional information: Subscription outstanding for the year 2018 is 8,000.
9. How the following items will appear in the final accounts of a club for the year
ending 31 March 2019?
st
Dr. Receipts and Payments Account for the year ended 31st March, 2019 Cr.
t t
To subscription
2017-2018 10,000
2018-2019 50,000
2019-2020 5,000 65,000
There are 200 members in the club each paying an annual subscription of 400
per annum. Subscription still outstanding for the year 2017- 2018 is 2,000.
10. How will the following items appear in the final accounts of a club for the
year ending 31 March 2017? Received subscription of 40,000 during the year
st
2016-17. This includes subscription of ` 5,000 for 2015-16 and 3,000 for the year
2017-18. Subscription of 1,000 is still outstanding for the year 2016-17.

11. Compute income from subscription for the year 2018 from the following
particulars relating to a club.
Particulars 1.1.2018 31.12.2018
Outstanding subscription 3,000 5,000
Subscription received in advance 4,000 7,000
Subscription received during the year 2018: 45,000.
12. From the following particulars, show how the item ‘subscription’ will appear in
the Income and Expenditure Account for the year ended 31-12-2018?
Subscription received in 2018 is 50,000 which includes 5,000 for 2017 and
7,000 for 2019. Subscription outstanding for the year 2018 is 6,000.
Subscription of 4,000 was received in advance for 2018 in the year 2017.
13. How the following items appear in the final accounts of Thoothukudi Young
Pioneers Association?
There are one hundred members in the association each paying 25 as annual
subscription. By the end of the year 10 members had not paid their subscription
but four members had paid for the next year in advance.
14. How will the following appear in the final accounts of Marthandam Women
Cultural Association?
Stock of sports materials on 1.4.2018 16,000

Sports materials purchased during the year 84,000
Stock of sports materials on 31.3.2019 10,000
15. How will the following appear in the final accounts of Vedaranyam Sports
club?
Opening stock of bats and balls 3,000

Purchase of bats and balls during the year 17,000
Sale of old bats and balls 2,000
Closing stock of bats and balls 4,000

16. Show how the following items appear in the income and expenditure account
of Sirkazhi Singers Association?
Stock of stationery on 1.4.2018 2,600

Purchase of stationery during the year 6,500
Stock of stationery on 31.3.2018 2,200
17. Chennai tennis club had Match fund showing credit balance of 24,000 on 1st
April, 2018. Receipt to the fund during the year was 26,000. Match expenses
incurred during the year was 33,000. How these items will appear in the final
accounts of the club for the year ended 31 st March, 2019?
18. How will the following appear in the final accounts of Karaikudi sports club
for the year ending 31st March, 2019?
Tournament fund on 1st April 2018 90,000

Tournament fund investment on 1 st April 2018 90,000
Interest received on tournament fund investment 9,000
Donation to tournament fund 10,000
Tournament expenses 60,000
19. Compute capital fund of Salem Sports Club as on 1.4.2019.

Sports equipment 30,000 Prize fund 10,000
Computer 25,000 Prize fund investments 10,000
Subscription outstanding for (2018-19) 5,000 Cash in hand 7,000
Subscription received in advance for
(2019-20) 8,000 Cash at bank 21,000
20. From the following Receipts and Payment account and from the information
given below of Ramanathapuram Sports Club, prepare Income and Expenditure
account for the year ended 31st December, 2018 and the balance sheet as on
that date.
To Balance b/d By Rent 11,000
Cash in hand 5,000 By Entertainment 11,200

expenses
Cash at bank 10,000 By Furniture 10,000

To Subscriptions By Sports materials 13,000

purchased
2017 12,000 By Match expenses 12,000
2018 33,000 By Investments made 28,000
2019 16,000 By Balance c/d
To Entrance fees 6,000 Cash in hand 1,300
To General donations 7,000 Cash at bank 4,000 5,300
To Sale of old sports 1,000

materials
To Miscellaneous receipts 500
90,500 90,500
(i) Capital fund as on 1st January 2018 30,000.
(ii) Opening stock of sports material 3,000 and closing stock of sports material
5,000.
21. From the following Receipts and Payment account of Yercaud Youth
Association, prepare Income and expenditure account for the year ended 31 st
March, 2019 and the balance sheet as on that date.
To Balance b/d By Salary 14,000
Cash in hand 9,600 By Office expenses 7,200
To Government grants for 10,000 By Books purchased 15,000

purchase of books
To Subscriptions 24,800 By Stationery purchased 1,800

www.nammakalvi.in

To Admission fees 2,000 By Newspaper purchased 2,100
To Prize fund receipts 6,000 By Prizes awarded 5,000
To Bank interest 1,500 By Balance c/d
To Sale of newspapers 1,100 Cash in hand 9,900
55,000 55,000
( i) Opening capital fund 20,000.
(ii) Stock of books on 1.4.2018 9,200.
(iii) Subscription due but not received 1,700.
(iv) Stock of stationery on (1.4.2018) 1,200 and stock of stationery on
(31.3.2019), 2,000
22. Following is the Receipts and Payments account of Neyveli Science Club for
the year ended 31st December, 2018.
To Balance b/d By Balance b/d
Cash in hand 2,400 Bank overdraft 1,000
To Subscription 8,700 By Postage expenses 200
To Life membership fees 5,000 By Science equipments 10,000

purchased
To Exhibition fund receipts 7,000 By Laboratory expenses 2,400
To Sale of science 6,000 By Secretary’s 5,000

equipments (Book value honorarium
5,000)
To Miscellaneous income 500 By Audit fees By Balance 3,600

c/d

By General charges 1,800
By Exhibition expenses 5,000
By Balance c/d
Cash in hand 200
Cash at bank 400
29,600 29,600
(i) Opening capital fund 6,400
(ii) Subscription includes 600 for the year 2019
(iii) Science equipment as on 1.1.2018 5,000
(iv) Surplus on account of exhibition should be kept in reserve for new
auditorium.
Prepare income and expenditure account for the year ended 31st December,
2018 and the balance sheet as on that date.
23. From the following Receipts and Payments account of Sivakasi Pensioner’s
Recreation Club, prepare income and expenditure account for the year ended
31st March, 2018 and the balance sheet as on that date.
Receipts Amount Payments Amount Amount
To Balance b/d By Rent and rates 18,000
Cash in hand 10,000 By Electricity charges 17,000
Cash at bank 20,000 By Furniture purchased 12,000
To Subscriptions By Billiards table 70,000

purchased
2017 5,000 By Repairs and renewals 16,000
2018 25,000 By Special dinner 4,000

expenses
2019 6,000 By Sundry expenses 2,000
To Rent from hall 14,000 Cash in hand 1,000
To Lockers rent 5,000
To Collection for special 12,000

dinner
To Balance c/d
Bank overdraft 3,000
1,40,000 1,40,000
(i) The club had 300 members each paying 100 as annual subscription.
(ii) The club had furniture 10,000 on 1.4.2017.
(iii) The subscription still due but not received for the year 2016 – 2017 is 1,000.
24. Following is the Receipts and payments account of Virudhunagar Volleyball

Association for the year ended 31st December, 2018.
Receipts Amount Payments Amount Amount
To Balance b/d By Match expenses 25,000
Cash in hand 5,000 By Upkeep of pavilion 17,000
To Subscriptions By Secretary’s 18,000

honorarium

2017 10,000 By Bats and balls 22,000

purchased
2018 55,000 By Grass seeds 2,000
2019 5,000 By Fixed deposit 58,000
To Donations 40,000 By Sundry expenses 3,000
To Match fund receipts 30,000 By Balance c/d
To Interest on fixed deposit 8,000 Cash in hand 7,000
To Miscellaneous receipts 5,000 Cash at bank 6,000 13,000
1,58,000 1,58,000
(i) On 1.1.2018, the association owned investments 10,000, premises and
grounds 40,000, stock of bats and balls 5,000.
(ii) Subscription 5,000 related to 2017 is still due.
(iii) Subscription due for the year 2018, 6,000.
Prepare income and expenditure account for the year ended 31st December,
2018 and the balance sheet as on that date.

UNIT 3
STD: XII
ILLUSTRATIONS:
1. A, B, C and D are partners in a firm. There is no partnership deed. How will

you deal with the following?
(i) A has contributed maximum capital. He demands interest on capital at 12%
per annum.
(ii) B has withdrawn 1,000 per month. Other partners ask B to pay interest on
drawings @ 10% per annum to the firm. But, B does not agree to it.
(iii) Loan advanced by C to the firm is ` 10,000. He demands interest on loan @
9% per annum. A and B do not agree with this.
(iv) D demands salary at the rate of ` 5,000 per month as he spends full time for
the business. B and C do not agree with this.
(v) A demands the profit to be shared in the capital ratio. But, B, C and D do not
agree.
2. From the following information, prepare capital accounts of partners Shanthi
and Sumathi, when their capitals are fixed.
Particulars Shanthi Sumathi
Capital on 1st January 2018 1,00,000 80,000

Current account on 1st January 2018 (Cr.) 5,000 3,000
Additional capital introduced on 1st June 2018 10,000 20,000
Drawings during 2018 20,000 13,000
Interest on drawings 500 300
Share of profit for 2018 10,000 8,000
Interest on capital 6,300 5,400
Salary 9,000 Nil
Commission Nil 1,200

3. Bragathish and Naresh are partners who maintain their capital accounts under
fixed capital method. From the following particulars, prepare capital accounts of
partners.
Particulars Bragathish Naresh
Capital on 1st April 2018 4,00,000 6,00,000
Current account on 1st April 2018 20,000(Cr.) 15,000(Dr.)
Additional capital introduced 50,000 Nil
Interest on drawings 2,000 3,000
Share of profit for 2018 80,000 1,20,000
Commission 17,000 Nil
Salary Nil 38,000
4. From the following information, prepare capital accounts of partners Mannan

and Sevagan, when their capitals are fluctuating.
Particulars Mannan Sevagan
Capital on 1st January 2018 (Cr.) 2,00,000 1,75,000
Interest on drawings 1,000 500
Salary 18,000 Nil

www.nammakalvi.in

5. Mannan and Ramesh share profits and losses in the ratio of 3:1. The capital on
1st April 2017 was 80,000 for Mannan and 60,000 for Ramesh and their current
accounts show a credit balance of 10,000 and 5,000 respectively. Calculate
interest on capital at 5% p.a. for the year ending 31st March 2018 and show the
journal entries.
6. Antony and Akbar were partners who share profits and losses in the ratio of
3:2. Balance in their capital account on 1st January 2018 was Antony 60,000 and
Akbar 40,000. On 1st April 2018 Antony introduced additional capital of 10,000.
Akbar introduced additional capital of 5,000 during the year. Calculate interest on
capital at 6% p.a. for the year ending 31st December 2018.
7. The capital account of Arivazhagan and Srinivasan on 1st January 2017

showed a balance of 15,000 and 10,000 respectively. On 1st July 2017,
Arivazhagan introduced an additional capital of 5,000 and on 1st September
2017 Srinivasan introduced an additional capital of 10,000. Calculate interest on
capital at 6% p.a. for the year ending 31st December 2017.
8. From the following balance sheets of Subha and Sudha who share profits and
losses equally, calculate interest on capital at 6% p.a. for the year ending 31st
December
2017.
Balance sheet as on 31st December 2017
Liabilities Amount Assets Amount
Capital accounts: Fixed assets 30,000
Subha 15,000 Current assets 20,000
Sudha 20,000
Current liabilities 15,000
50,000 50,000
Drawings of Subha and Sudha during the year were 2,500 and 3,500
respectively. Profit earned during the year was 15,000.

9. From the following balance sheets of Brindha and Praveena who share profits
and losses in the ratio of 3:4, calculate interest on capital at 6% p.a. for the year
ending 31st December 2017.
Capital accounts: Sundry assets 80,000
Brindha 30,000
Praveena 40,000
Profit and loss 10,000

appropriation A/c
80,000 80,000
On 1st July 2017, Brindha introduced an additional capital of 6,000 and on 1st
October2017, Praveena introduced 10,000. Drawings of Brindha and Praveena
during the year were 5,000 and 7,000 respectively. Profit earned during the year
was 31,000.
10. A and B contribute 4,00,000 and 2,00,000 respectively as capital. Their

respective share of profit is 3:2 and the profit before interest on capital for the
year is 27,000. Compute the amount of interest on capital in each of the following
situations:
(i) if the partnership deed is silent as to the interest on capital
(ii) if interest on capital @ 3% is allowed as per the partnership deed
(iii) if the partnership deed allows interest on capital @ 5% p.a.
11. Velan is a partner who withdrew 20,000 on 1st April 2018. Interest on
drawings is charged at 10% per annum. Calculate interest on drawings on 31st
December 2018 and pass journal entries by assuming fluctuating capital method.

12. Arun is a partner in a partnership firm. As per the partnership deed, interest
on drawings is charged at 12% p.a. During the year ended 31st December 2018
he drew as follows:
March 1 6,000
June 1 4,000
September1 5,000
December 1 2,000
Calculate the amount of interest on drawings.
13. Arul is a partner in a partnership firm. As per the partnership deed, interest on
drawings is charged at 12% p.a. During the year ended 31st December 2018 he
drew as follows:
March 1 3,000
June 1 3,000
September 1 3,000
December 1 3,000
14. Rajan is a partner who withdrew 30,000 during the year 2018. Interest on
December, 2018.
15. Anbu is a partner in a partnership firm. As per the partnership deed, interest
on drawings is charged at 12% p.a. During the year ended 31st December 2018
he drew as follows:
March 1 6,000
June 1 4,000
September 1 5,000
December 1 2,000
Calculate the amount of interest on drawings by using product method.
16. John is a partner in a firm. He withdraws 1,000 p.m. regularly. Interest on

drawings is charged @ 5% p.a. Calculate the interest on drawings using average
period, if he draws
(i) at the beginning of every month
(ii) in the middle of every month
(iii) at the end of every month

17. Priya and Kavitha are partners. Priya draws 4,000 at the end of each quarter.
Interest on drawings is chargeable at 6% p.a. Calculate interest on drawings for
the year ending 31st December 2018 using average period.
18. Vennila and Eswari are partners. Vennila draws 5,000 at the beginning of
each half year. Interest on drawings is chargeable at 4% p.a. Calculate interest
on drawings for the year ending 31st December 2018 using average period.
19. Syed, Samuel and Sudhakar are partners in a firm sharing profits and losses
equally. As per the terms of the partnership deed, Samuel is allowed a monthly
salary of 2,000 and Sudhakar is allowed a commission of 6,000 per annum for
their contribution to the business of the firm. You are required to pass the
necessary journal entry. Assume that their capitals are fluctuating.
20. Murali and Sethu are partners in a firm. Murali is to get a commission of 10%
of net profit before charging any commission. Sethu is to get a commission of
10% on net profit after charging all commission. Net profit for the year ended 31st
March 2019 before charging any commission was1,10,000. Find the amount of
commission due to Murali and Sethu.
21. Arulappan and Nallasamy are partners in a firm sharing profits and losses in
the ratio of 4:1. On 1st January 2018, their capitals were 20,000 and 10,000
respectively. The partnership deed specifies the following:
(a) Interest on capital is to be allowed at 5% per annum.
(b) Interest on drawings charged to Arulappan and Nallasamy are ` 200 and ` 300
respectively.
(c) The net profit of the firm before considering interest on capital and interest on
drawings amounted to18,000.
Give necessary journal entries and prepare Profit and loss appropriation account
for the year ending 31st December 2018. Assume that the capitals are
fluctuating.
22. Durai and Velan entered into a partnership agreement on 1st April 2018,
Durai contributing 25,000 and Velan 30,000 as capital. The agreement provided
that:
(a) Profits and losses to be shared in the ratio 2:3 as between Durai and Velan.
(b) Partners to be entitled to interest on capital @ 5% p.a.
(c) Interest on drawings to be charged Durai: 300 Velan: 450
(d) Durai to receive a salary of 5,000 for the year, and
(e) Velan to receive a commission of 2,000

During the year, the firm made a profit of 20,000 before adjustment of interest,
salary and commission. Prepare the Profit and loss appropriation account.
23. Richard and Rizwan started a business on 1st January 2018 with capitals of
3,00,000 and 2,00,000 respectively.
According to the Partnership Deed
(a) Interest on capital is to be provided @ 6% p.a.
(b) Rizwan is to get salary of 50,000 per annum.
(c) Richard is to get 10% commission on profit (after interest on capital and
salary to Rizwan) after charging such commission.
(d) Profit-sharing ratio between the two partners is 3:2.
During the year, the firm earned a profit of 3,00,000.
Prepare profit and loss appropriation account. The firm closes its accounts on
31st December every year.
EXERCISE PROBLEMS
1. Akash, Bala, Chandru and Daniel are partners in a firm. There is no

partnership deed. How will you deal with the following?
(i) Akash has contributed maximum capital. He demands interest on capital at
10% per annum.
(ii) Bala has withdrawn ` 3,000 per month. Other partners ask Bala to pay interest
on drawings @ 8% per annum to the firm. But, Bala did not agree to it.
(iii) Akash demands the profit to be shared in the capital ratio. But, others do not
agree.
(iv) Daniel demands salary at the rate of ` 10,000 per month as he spends full
time for the business.
(v) Loan advanced by Chandru to the firm is ` 50,000. He demands interest on
loan @ 12% per annum.

2. From the following information, prepare capital accounts of partners Rooban

and Deri, when their capitals are fixed.
Particulars Rooban Deri
Capital on 1st April 2018 70,000 50,000
Current account on 1st April 2018 (Cr.) 25,000 15,000
Additional capital introduced 18,000 16,000
Salary Nil 18,000
3. Arun and Selvam are partners who maintain their capital accounts under fixed
capital method. From the following particulars, prepare capital accounts of
partners.
Particulars Arun Selvam
Capital on 1st January 2018 2,20,000 1,50,000
Current account on 1st January2018 4,250(Cr.) 10,000(Dr.)
Additional capital introduced Nil 70,000

www.nammakalvi.in

Interest on capital 1,100 750
Salary Nil 6,850
4. From the following information, prepare capital accounts of partners Padmini

and Padma, when their capitals are fluctuating.
Particulars Padmini Padma
Capital on 1st January 2018 (Cr.) 5,00,000 4,00,000
Interest on drawings 2,000 1,000
Salary 45,000 Nil
5. Mannan and Ramesh share profits and losses in the ratio of 3:2 and their
capital on 1st April, 2018 was Mannan 1,50,000 and Ramesh 1,00,000
respectively and their current accounts show a credit balance of 25,000 and
20,000 respectively. Calculate interest on capital at 6% p.a. for the year ending
31st March, 2019 and show the journal entries.
6. Prakash and Supria were partners who share profits and losses in the ratio of
5:3. Balance in their capital account on 1st April, 2018 was Prakash 3,00,000 and
Supria 2,00,000. On 1st July, 2018 Prakash introduced additional capital of
60,000. Supria introduced additional capital of 30,000 during the year. Calculate
interest on capital at 6% p.a. for the year ending 31st March, 2019 and show the
journal entries.

7. The capital account of Begum and Fatima on 1st January, 2018 showed a
balance of 50,000 and 40,000 respectively. On 1st October, 2018, Begum
introduced an additional capital of 10,000 and on 1st May, 2018 Fatima
introduced an additional capital of 9,000. Calculate interest on capital at 4% p.a.
for the year ending 31st December, 2018.
8. From the following balance sheets of Subha and Sudha who share profits and
losses in 2:3, calculate interest on capital at 5% p.a. for the year ending 31st
December, 2018.
Capital accounts: Fixed assets 70,000
Subha 40,000 Current assets 50,000
Sudha 60,000
1,20,000 1,20,000
Drawings of Subha and Sudha during the year were ` 8,000 and ` 10,000
respectively.
Profit earned during the year was 30,000.

9. From the following balance sheets of Rajan and Devan who share profits and
losses 2:1, calculate interest on capital at 6% p.a. for the year ending 31st
December, 2018.
Capital accounts: Sundry assets 2,20,000
Rajan 1,00,000
Devan 80,000
Profit and loss 40,000

appropriation A/c
2,20,000 2,20,000
On 1st April, 2018, Rajan introduced an additional capital of 40,000 and on 1st
September, 2018, Devan introduced 30,000. Drawings of Rajan and Devan
during the year were 20,000 and 10,000 respectively. Profit earned during the
year was 70,000.
10. Ahamad and Basheer contribute 60,000 and 40,000 respectively as capital.
Their respective share of profit is 2:1 and the profit before interest on capital for
the year is 5,000. Compute the amount of interest on capital in each of the
following situations:
(i) if the partnership deed is silent as to the interest on capital
(ii) if interest on capital @ 4% is allowed as per the partnership deed
(iii) if the partnership deed allows interest on capital @ 6% per annum.
11. Mani is a partner, who withdrew 30,000 on 1st September, 2018. Interest on
December, 2018 and show the journal entries by assuming that fluctuating
capital method is followed.

12. Santhosh is a partner in a partnership firm. As per the partnership deed,

interest on drawings is charged at 6% per annum. During the year ended 31st
December, 2018 he withdrew as follows:
February 1 2,000
May 1 10,000
July 1 4,000
October 1 6,000
13. Kumar is a partner in a partnership firm. As per the partnership deed, interest
on drawings is charged at 6% per annum. During the year ended 31st December,
2018 he withdrew as follows:
March 1 4,000
June 1 4,000
September 1 4,000
December 1 4,000
14. Mathew is a partner who withdrew 20,000 during the year 2018. Interest on
December 2018.
15. Santhosh is a partner in a partnership firm. As per the partnership deed,

interest on drawings is charged at 6% per annum. During the year ended 31st
December, 2018 he withdrew as follows:
February 1 2,000
May 1 10,000
July 1 4,000
October 1 6,000
Calculate the amount of interest on drawings by using product method.
16. Kavitha is a partner in a firm. She withdraws 2,500 p.m. regularly. Interest on
drawings is charged @ 4% p.a. Calculate the interest on drawings using average
period, if she draws
(i) at the beginning of every month
(ii) in the middle of every month
(iii) at the end of every month
17. Kevin and Francis are partners. Kevin draws 5,000 at the end of each
quarter. Interest on drawings is chargeable at 6% p.a. Calculate interest on
drawings for the year ending 31st March 2019 using average period.

18. Ram and Shyam were partners. Ram withdrew 18,000 at the beginning of
each half year. Interest on drawings is chargeable @ 10% p.a. Calculate interest
on the drawings for the year ending 31st December 2018 using average period.
19. Janani, Kamali and Lakshmi are partners in a firm sharing profits and losses
equally. As per the terms of the partnership deed, Kamali is allowed a monthly
salary of 10,000 and Lakshmi is allowed a commission of 40,000 per annum for
their contribution to the business of the firm. You are required to pass the
necessary journal entry. Assume that their capitals are fluctuating.
20. Sibi and Manoj are partners in a firm. Sibi is to get a commission of 20% of
net profit before charging any commission. Manoj is to get a commission of 20%
on net profit after charging all commission. Net profit for the year ended 31st
December 2018 before charging any commission was ` 60,000. Find the
commission of Sibi and Manoj. Also show the distribution of profit.
21. Anand and Narayanan are partners in a firm sharing profits and losses in the
ratio of 5:3. On 1st January 2018, their capitals were 50,000 and 30,000
respectively. The partnership deed specifies the following:
(a) Interest on capital is to be allowed at 6% per annum.
(b) Interest on drawings charged to Anand and Narayanan are 1,000 and 800
respectively.
(c) The net profit of the firm before considering interest on capital and interest on
drawings amounted to 35,000.
Give necessary journal entries and prepare profit and loss appropriation account
as on 31st December 2018. Assume that the capitals are fluctuating.

22. Dinesh and Sugumar entered into a partnership agreement on 1st January
2018, Dinesh contributing 1,50,000 and Sugumar 1,20,000 as capital. The
agreement provided that:
(a) Profits and losses to be shared in the ratio 2:1 as between Dinesh and
Sugumar.
(b) Partners to be entitled to interest on capital @ 4% p.a.
(c) Interest on drawings to be charged Dinesh: 3,600 and Sugumar: 2,200
(d) Dinesh to receive a salary of 60,000 for the year, and
(e) Sugumar to receive a commission of 80,000
During the year ended on 31st December 2018, the firm made a profit of
2,20,000 before adjustment of interest, salary and commission. Prepare the Profit
and loss appropriation account.
23. Antony and Ranjith started a business on 1st April 2018 with capitals of
4,00,000 and 3,00,000 respectively. According to the Partnership Deed, Antony
is to get salary of 90,000 per annum, Ranjith is to get 25% commission on profit
after allowing salary to Antony and interest on capital @ 5% p.a. but after
charging such commission. Profit-sharing ratio between the two partners is 1:1.
During the year, the firm earned a profit of 3,65,000.
Prepare profit and loss appropriation account. The firm closes its accounts on
31st March every year.

www.nammakalvi.in
UNIT 4

STD: XII
ILLUSTRATIONS:
1. The following are the profits of a firm in the last five years:
2014: 4,000; 2015: 3,000; 2016: 5,000; 2017: 4,500
and 2018: 3,500
Calculate the value of goodwill at 3 years purchase of average profits of five
years.
2. The profits and losses of a firm for the last four years were as follows:
2015: 15,000; 2016: 17,000; 2017: 6,000 (Loss); 2018: 14,000
You are required to calculate the amount of goodwill on the basis of 5 years
purchase of average profits of the last 4 years.
3. A partnership firm has decided to value its goodwill for the purpose of settling
a retiring partner. The profits of that firm for the last four years were as follows:
2015: 40,000; 2016: 50,000; 2017: 48,000 2018: 46,000
The business was looked after by a partner. No remuneration was paid to him.
The fair
remuneration of the partner valued at comes to ` 6,000 per annum. Find out the
value of goodwill, if it is valued on the basis of three years purchase of the
average profits of the last four years.
4. From the following information relating to Arul enterprises, calculate the value
of goodwill on the basis of 2 years purchase of the average profits of 3 years.
(a) Profits for the years ending 31st December 2016, 2017 and 2018 were
46,000, 44,000 and 50,000 respectively.
(b) A non-recurring income of 5,000 is included in the profits of the year 2016.
(c) The closing stock of the year 2017 was overvalued by 10,000.

5. The following particulars are available in respect of a business carried on by a

partnership firm:
(a) Profits earned: 2016: 30,000; 2017: 29,000 2018: 32,000.
(b) Profit of 2016 includes a non-recurring income of 3,000.
(c) Profit of 2017 is reduced by 2,000 due to stock destroyed by fire.
(d) The stock is not insured. But, it is decided to insure the stock in future. The
insurance premium is estimated at 5,600 per annum.
You are required to calculate the value of goodwill on the basis of 2 years
purchase of average profits of the last three years.
6. For the purpose of admitting a new partner, a firm has decided to value its
goodwill at 3 years purchase of the average profit of the last 4 years using
weighted average method. Profits of the past 4 years and the respective weights
are as follows:
Particulars 2015 2016 2017 2018
Profit 20,000 22,000 24,000 28,000
Weight 1 2 3 4
7. From the following information, calculate the value of goodwill based on 3

years purchase of super profit
(i) Capital employed: 2,00,000
(ii) Normal rate of return: 15%
(ii) Average profit of the business: 42,000
8. Calculate the value of goodwill at 5 years purchase of super profit from the
following
information:
(a) Capital employed: 1,20,000
(b) Normal rate of profit: 20%
(c) Net profit for 5 years:
2014: 30,000; 2015: 32,000; 2016: 35,000; 2017: 37,000 ;
2018: 40,000
(d) Fair remuneration to the partners 2,800 per annum.

9. From the following information, compute the value of goodwill as per annuity
method:
(a) Capital employed: 50,000
(b) Normal rate of return: 10%
(c) Profits of the years 2016, 2017 and 2018 were 13,000, 15,000 and 17,000
respectively.
(d) The present value of annuity of Rs. 1 for 3 years at 10% is 2. 4868.
10. From the following information, compute the value of goodwill by capitalising
super profit:
(a) Capital employed is 4,00,000
(b) Normal rate of return is 10%
(c) Profit for 2016: 62,000; 2017: 61,000; 2018: 63,000
11. From the following information, find out the value of goodwill by capitalisation
method:
(a) Average profit = 60,000
(b) Normal rate of return = 10%
(c) Capital employed = 4,50,000
EXERCISE PROBLEMS
1. Compute average profit from the following information.
2016: 8,000; 2017: 10,000; 2018: 9,000
2. Calculate the value of goodwill at 2 years purchase of average profit when

average profit is 15,000.
3. The following are the profits of a firm in the last five years:
2014: 10,000; 2015: 11,000; 2016: 12,000; 2017: 13,000
2018: 14,000
Calculate the value of goodwill at 2 years purchase of average profit of five
years.

4. From the following information, calculate the value of goodwill on the basis of 3
years purchase of average profits of last four years.
YEAR RESULT AMOUNT
2015 PROFIT 5000
2016 PROFIT 8000
2017 LOSS 3000
2018 PROFIT 6000
5. From the following information relating to a partnership firm, find out the value
of its goodwill based on 3 years purchase of average profits of the last 4 years:
(a) Profits of the years 2015, 2016, 2017 and 2018 are 10,000, 12,500, 12,000
and 11,500 respectively.
(b) The business was looked after by a partner and his fair remuneration
amounts to 1,500 per year. This amount was not considered in the calculation of
the above profits.
6. From the following information relating to Sridevi enterprises, calculate the

value of goodwill on the basis of 4 years purchase of the average profits of 3
years.
(a) Profits for the years ending 31st December 2016, 2017 and 2018 were
1,75,000, 1,50,000, 2,00,000 respectively.
(b) A non-recurring income of ` 45,000 is included in the profits of the year 2016.
(c) The closing stock of the year 2017 was overvalued by 30,000.
7. The following particulars are available in respect of the business carried on by

a partnership firm:
(i) Profits earned: 2016: 25,000; 2017: ` 23,000 and 2018: 26,000.
(ii) Profit of 2016 includes a non-recurring income of 2,500.
(iii) Profit of 2017 is reduced by 3,500 due to stock destroyed by fire.
(iv) The stock was not insured. But, it is decided to insure the stock in future. The
insurance premium is estimated to be 250 per annum.
You are required to calculate the value of goodwill of the firm on the basis of 2
years purchase of average profits of the last three years.

www.nammakalvi.in

8. Find out the value of goodwill at three years purchase of weighted average
profit of last four years.
Particulars 2015 2016 2017 2018

Profit 10,000 12,000 16,000 18,000
Weight 1 2 3 4
9. From the following details, calculate the value of goodwill at 2 years purchase
of super profit:
(a) Total assets of a firm are 5,00,000
(b) The liabilities of the firm are 2,00,000
(c) Normal rate of return in this class of business is 12.5 %.
(d) Average profit of the firm is 60,000.
10. partnership firm earned net profits during the last three years as follows:
2016 : 20,000; 2017 : 17,000 2018 : 23,000
The capital investment of the firm throughout the above mentioned period has
been ` 80,000. Having regard to the risk involved, 15% is considered to be a fair
return on capital employed in the business. Calculate the value of goodwill on the
basis of 2 years purchase of super profit.
11. From the following information, calculate the value of goodwill under annuity
method:
(i) Average profit 14,000
(ii) Normal Profit 4,000
(iii) Normal rate of return 15%
(iv) Years of purchase of goodwill 5
Present value of Rs.1 for 5 years at 15% per annum as per the annuity table is
3.352

12. Find out the value of goodwill by capitalising super profits:
(a) Normal Rate of Return 10%
(b) Profits for the last four years are 30,000, 40,000, 50,000 and 45,000.
(c) A non-recurring income of ` 3,000 is included in the above mentioned profit of

30,000.
(d) Average capital employed is 3,00,000.
13. From the following information, find out the value of goodwill by capitalisation
method:
(i) Average profit 20,000
(ii) Normal rate of return 10%
(iii) Tangible assets of the firm 2,20,000
(iv) Liabilities of the firm 70,000

UNIT 5
STD: XII
ILLUSTRATIONS:
1. Mala and Vimala were partners sharing profits and losses in the ratio of 3:2.
On 31.3.2017, Varshini was admitted as a partner. On the date of admission, the
book of the firm showed a reserve fund of ` 50,000. Pass the journal entry to
distribute the reserve fund.
2. Kavitha and Radha are partners of a firm sharing profits and losses in the ratio
of 4:3. They admit Deepa on 1.1.2019. On that date, their balance sheet showed
debit balance of profit and loss account being accumulated loss of ` 70,000 on
the asset side of the balance sheet. Give the journal entry to transfer the
accumulated loss on admission.
3. Rathna Kumar and Arockia Das are partners in a firm sharing profits and
losses in the ratio of 3:2. Their balance sheet as on 31st March, 2017 is as
follows:
Liabilities Amount Amount Assets Amount

Capital accounts Buildings 30,000
Rathna Kumar 30,000 Plant 60,000
Arockia Das 50,000 80,000 Furniture 20,000
Profit and loss 20,000 Debtors 10,000
appropriation A/c
General reserve 5,000 Stock 15,000
Workmen 15,000 Cash at bank 15,000
compensation fund
Sundry creditors 30,000
1,50,000 1,50,000
David was admitted into the partnership on 1.4.2017. Pass journal entry to
distribute the accumulated profits and reserve on admission.

4. Rajesh and Ramesh are partners sharing profits in the ratio 3:2. Raman is
admitted as a new partner and the new profit sharing ratio is decided as 5:3:2.
The following revaluations are made. Pass journal entries and prepare
revaluation account.
(a) The value of building is increased by 15,000.
(b) The value of the machinery is decreased by 4,000.
(c) Provision for doubtful debt is made for 1,000.
5. Sriram and Raj are partners sharing profits and losses in the ratio of 2:1.
Nelson joins as a partner on 1st April 2017. The following adjustments are to be
made:
(i) Increase the value of stock by 5,000
(ii) Bring into record investment of 7,000 which had not been recorded in the
books of the firm.
(iii) Reduce the value of office equipment by 10,000
(iv) A provision would also be made for outstanding wages for 9,500.
Give journal entries and prepare revaluation account.
6. Raghu and Sam are partners in a firm sharing profits and losses in the ratio of
3:2. Their balance sheet as on 31st March, 2017 is as follows:
Liabilities Amount Amount Assets Amount Amount
Capital accounts Machinery 30,000
Ragu 40,000 Stock 10,000
Sam 30,000 70,000 Furniture 10,000
Sundry creditors 30,000 Debtors 21,000
Less: provision for 1,000 20,000

bad & doubtful
debts
Bank 30,000
1,00,000 1,00,000

Prakash is admitted on 1.4.2017 subject to the following conditions:

(a) He has to bring a capital of 10,000
(b) Machinery is valued at 24,000
(c) Furniture to be depreciated by 3,000
(d) Provision for doubtful debts should be increased to 3,000
(e) Unrecorded trade receivables of 1,000 would be brought into books now
Pass necessary journal entries and prepare revaluation account and capital
account of partners after admission.
7. Anand and Balu are partners in a firm sharing profits and losses in the ratio of
7:3. Their balance sheet as on 31st March, 2018 is as follows:
Capital accounts Land 60,000
Anand 50,000 Stock 40,000
balu 30,000 80,000 Debtors 20,000
Sundry creditors 20,000 Cash in hand 10,000
Profit & loss 30,000

A/c
1,30,000 1,30,000
Chandru is admitted as a new partner on 1.4.2018 by introducing a capital of

20,000 for ¼ share in the future profit subject to the following adjustments:
(a) Stock to be depreciated by 3,000
(b) Provision for doubtful debts to be created for 2,000.
(c) Land was to be appreciated by 10,000
Prepare revaluation account and capital account of partners after admission.

www.nammakalvi.in

8. Anbu and Raju are partners, sharing profits in the ratio of 3:2. Akshai is
admitted as a partner. The new profit sharing ratio among Anbu, Raju and Akshai
is 5:3:2. Find out the sacrificing ratio.
9. Hari and Saleem are partners sharing profits and losses in the ratio of 5:3.
They admit Joel for 1/8 share, which he acquires entirely from Hari. Find out the
new profit sharing ratio and sacrificing ratio.
10. Ravi and Kumar share profits and losses in the ratio of 7:3. Christy is
admitted as a new partner with 3/7 share which he acquires 2/7 from Ravi and
1/7 from Kumar. Calculate the new profit sharing ratio and sacrificing ratio.
11. Hameed and Govind are partners sharing profits and losses in the ratio of
5:3. They admit John as a partner. John acquires his share 1/5 from Hameed
and 1/5 from Govind. Find out the new profit sharing ratio and sacrificing ratio.
12. Suresh and Dinesh are partners sharing profits in the ratio of 3:2. They admit
Ramesh as a new partner. Suresh surrenders 1/5 of his share in favour of
Ramesh. Dinesh surrenders 2/5 of his share in favour of Ramesh. Calculate the
new profit sharing ratio and sacrificing ratio.
13. Prasanth and Nisha are partners sharing profits and losses in the ratio of 3:2.
They admit Ramya as a new partner. Prasanth surrenders 2/5 of his share and
Nisha surrenders 2/5 of her share in favour of Ramya. Calculate the new profit
sharing ratio and sacrificing ratio.
14. Ramesh and Raju are partners sharing profits in the ratio of 2:1. They admit
Ranjan into partnership with 1/4 share of profit. Ranjan acquired the share from
old partners in the ratio of 3:2. Calculate the new profit sharing ratio and
sacrificing ratio.
15. Mahesh and Dhanush are partners sharing profits and losses in the ratio of
2:1. Arun is admitted for 1/4 share which he acquired equally from both Mahesh
and Dhanush. Calculate the new profit sharing ratio and sacrificing ratio.
16. Vimal and Athi are partners sharing profits in the ratio of 2:1. Jeyam is
admitted for 1/4 share in the profits. Calculate the new profit sharing ratio and
sacrificing ratio.

17. Anil, Sunil and Hari are partners in a firm sharing profits in the ratio of 4:3:3.
They admit Raja for 20% profit. Calculate the new profit sharing ratio and
sacrificing ratio.
18. Amudha and Bhuvana are partners who share profits and losses in the ratio
of 5:3. Chithra joins the firm on 1st January, 2019 for 3/8 share of profits and
brings in cash for her share of goodwill of ` 8,000. Pass necessary journal entry
for adjusting goodwill on the assumption that the fluctuating capital method is
followed and the partners withdraw the entire amount of their share of goodwill.
19. Arun, Babu and Charles are partners sharing profits and losses equally. They
admit Durai into partnership for 1/4 share in future profits. The goodwill of the firm
is valued at 36,000 and Durai brought cash for his share of goodwill. The existing
partners withdraw half of the amount of their share of goodwill. Pass necessary
journal entries on the assumption that the fluctuating capital method is followed.
20. Vasu and Devi are partners sharing profits and losses in the ratio of 3:2. They
admit Nila into partnership for 1/4 share of profit. Nila pays cash ` 3,000 towards
her share of goodwill. The new ratio is 3:3:2. Pass necessary journal entry on the
assumption that the fixed capital system is followed.
21. Ashok and Mumtaj were partners in a firm sharing profits and losses in the
ratio of 5:1. They have decided to admit Tharun into the firm for 2/9 share of
profits. The goodwill of the firm on the date of admission was valued at ` 27,000.
Tharun is not able to bring in cash for his share of goodwill. Pass necessary
journal entries for goodwill on the assumption that the fluctuating capital system
is followed.
22. Aravind and Balaji are partners sharing profits and losses in 3:2 ratio. They
admit Anirudh into partnership. The new profit sharing ratio is agreed at 1:1:1.
Anirudh’s share of goodwill is valued at ` 20,000 of which he pays ` 12,000 in
cash. Pass necessary journal entries for goodwill on the assumption that the
fluctuating capital method is followed.
23. Sathish and Sudhan are partners in a firm sharing profits and losses in the
ratio of 4:3. On 1st April 2018, they admitted Sasi as a partner. On the date of
Sasi’s admission, goodwill appeared in the books of the firm at 35,000. By
assuming fluctuating capital account, pass the necessary journal entry if the
partners decide to

(i) write off the entire amount of existing goodwill

(ii) write off 21,000 of the existing goodwill.
24. Vetri and Ranjit are partners, sharing profits in the ratio of 3:2. Their balance
sheet as on 31st December 2017 is as under:
Capital accounts Furniture 25,000
Vetri 30,000 Stock 20,000
Ranjith 20,000 50,000 Debtors 10,000
Reserve fund 5,000 Cash in hand 35,000
Sundry creditors 45,000 Profit and loss 10,000

A/c (loss)
1,00,000 1,00,000
On 1.1.2018, they admit Suriya into their firm as a partner on the following
arrangements.
(i) Suriya brings 10,000 as capital for 1/4 share of profit.
(ii) Stock to be depreciated by 10%
(iii) Debtors to be revalued at 7,500.
(iv) Furniture to be revalued at 40,000.
(v) There is an outstanding wages of 4,500 not yet recorded.
Prepare revaluation account, partners’ capital account and the balance sheet of
the firm after admission.

25. The balance sheet of Rekha and Mary on 31st March 2018 is as follows:
Rekha 50,000 Stock 8,000
Mary 30,000 80,000 Debtors 60,000
General reserve 40,000 Cash at bank 32,000
Workmen 10,000
compensation fund
1,50,000 1,50,000
They share the profits and losses in the ratio of 3:1.They agreed to admit Kavitha
into the partnership firm for 1/4 share of profit which she gets entirely from
Rekha.
Following are the conditions:
(i) Kavitha has to bring 20,000 as capital. Her share of goodwill is valued at
4,000. She could not bring cash towards goodwill.
(ii) Depreciate buildings by 10%
(iii) Stock to be revalued at 6,000
(iv) Create provision for doubtful debts at 5% on debtors
Prepare necessary ledger accounts and the balance sheet after admission.

26. Ameer and Raja are partners sharing profits in the ratio of 3:2. Their balance
sheet is shown as under on 31.12.2018.
Ameer 80,000 Furniture 40,000
Raja 70,000 1,50,000 Debtors 30,000
Reserve fund 15,000 Stock 10,000
Sundry creditors 35,000 Prepaid 40,000

insurance
Cash at bank 20,000
2,00,000 2,00,000
Rohit is admitted as a new partner who introduces a capital of ` 30,000 for his 1/5
share in future profits. He brings ` 10,000 for his share of goodwill. Following
revaluations are made:
(i) Stock is to be appreciated to 14,000
(ii) Furniture is to be depreciated by 5%
(iii) Machinery is to be revalued at ` 80,000
Prepare the necessary ledger accounts and the balance sheet after the
admission.

27. Veena and Pearl are partners in a firm sharing profits and losses in the ratio
of 2:1. Their balance sheet as on 31st March, 2018 is as follows:
Veena 60,000 Machinery 30,000
Pearl 40,000 1,00,000 Debtors 20,000

compensation fund
1,50,000 1,50,000
Deri is admitted on 1.4.2018 subject to the following conditions:

(a) The new profit sharing ratio among Veena, Pearl and Deri is 5:3:2.
(b) Deri has to bring a capital of ` 30,000
(c) Stock to be depreciated by 20%
(d) Anticipated claim on workmen compensation fund is ` 1,000
(e) Unrecorded investment of ` 11,000 has to be brought into books
(f) The goodwill of the firm is valued at ` 30,000 and Deri brought cash for his
share of goodwill. The existing partners withdraw the entire amount brought by
Deri towards goodwill.
Prepare the necessary ledger accounts and balance sheet after admission.

www.nammakalvi.in

EXERCISE PROBLEMS
1. Arul and Anitha are partners sharing profits and losses in the ratio of 4:3. On
31.3.2018, Ajay was admitted as a partner. On the date of admission, the book of
thefirm showed a general reserve of ` 42,000. Pass the journal entry to distribute
the general reserve.
2. Anjali and Nithya are partners of a firm sharing profits and losses in the ratio of
5:3. They admit Pramila on 1.1.2018. On that date, their balance sheet showed
accumulated loss of 40,000 on the asset side of the balance sheet. Give the
journal entry to transfer the accumulated loss on admission.
3. Oviya and Kavya are partners in a firm sharing profits and losses in the ratio of
5:3. They admit Agalya into the partnership. Their balance sheet as on 31st
March, 2019 is as follows:
Oviya 50,000 Plant 50,000
Kavya 40,000 90,000 Furniture 30,000

appropriation A/c
Workmen 12,000 Cash 20,000

compensation fund
1,70,000 1,70,000
Pass journal entry to transfer the accumulated profits and reserve on admission.

4. Hari, Madhavan and Kesavan are partners, sharing profits and losses in the
ratio of 5:3:2. As from 1st April 2017, Vanmathi is admitted into the partnership
and the new profit sharing ratio is decided as 4:3:2:1. The following adjustments
are to be made.
(a) Increase the value of premises by 60,000.
(b) Depreciate stock by ` 5,000, furniture by ` 2,000 and machinery by 2,500.
(c) Provide for an outstanding liability of 500.
Pass journal entries and prepare revaluation account.
5. Seenu and Siva are partners sharing profits and losses in the ratio of 5:3. In
the view of Kowsalya admission, they decided
(a) To increase the value of building by 40,000.
(b) To bring into record investments at 10,000, which have not so far been
brought into account.
(c) To decrease the value of machinery by 14,000 and furniture by 12,000.
(d) To write off sundry creditors by 16,000.
6. Sai and Shankar are partners, sharing profits and losses in the ratio of 5:3.
The firm’s balance sheet as on 31st December, 2017, was as follows:
Capital accounts Building 34,000
Ragu 48,000 Stock 16,000
Sam 40,000 88,000 Furniture 6,000
Sundry creditors 37,000 Debtors 40,000
Outstanding 8,000 Less: provision for bad 3,000 37,000

wages & doubtful debts
Bank 8,000
Bills receivables 12,000
Investment 20,000
1,33,000 1,33,000

On 31st December, 2017 Shanmugam was admitted into the partnership for 1/4
share of profit with 12,000 as capital subject to the following adjustments.
(a) Furniture is to be revalued at ` 5,000 and building is to be revalued at 50,000.
(c) Provision for doubtful debts is to be increased to 5,500
(d) An unrecorded investment of 6,000 is to be brought into account
(e) An unrecorded liability 2,500 has to be recorded now.
Pass journal entries and prepare Revaluation Account and capital account of
partners after admission.
7. Amal and Vimal are partners in a firm sharing profits and losses in the ratio of
7:5. Their balance sheet as on 31st March, 2019, is as follows:
Amal 70,000 Stock 25,000
Vimal 50,000 1,20,000 Debtors 30,000
Sundry creditors 30,000 Furniture 20,000
Profit & loss 24,000 Bank 19,000

A/c
1,74,000 1,74,000
Nirmal is admitted as a new partner on 1.4.2018 by introducing a capital of `

30,000 for 1/3 share in the future profit subject to the following adjustments.
(a) Stock to be depreciated by 5,000
(b) Provision for doubtful debts to be created for 3,000
(c) Land to be appreciated by 20,000
Prepare revaluation account and capital account of partners after admission.
8. Praveena and Dhanya are partners sharing profits in the ratio of 7:3. They
admit Malini into the firm. The new ratio among Praveena, Dhanya and Malini is
5:2:3. Calculate the sacrificing ratio.
9. Ananth and Suman are partners sharing profits and losses in the ratio of 3:2.
They admit Saran for 1/5 share, which he acquires entirely from Ananth. Find out
the new profit sharing ratio and sacrificing ratio.

10. Raja and Ravi are partners, sharing profits in the ratio of 3:2. They admit
Ram for 1/4 share of the profit. He takes 1/20 share from Raja and 4/20 from
Ravi. Calculate the new profit sharing ratio and sacrificing ratio.
11. Vimala and Kamala are partners, sharing profits and losses in the ratio of 4:3.
Vinitha enters into the partnership and she acquires 1/14 from Vimala and 1/14
from Kamala. Find out the new profit sharing ratio and sacrificing ratio.
12. Govind and Gopal are partners in a firm sharing profits in the ratio of 5:4.
They admit Rahim as a partner. Govind surrenders 2/9 of his share in favour of
Rahim. Gopal surrenders 1/9 of his share in favour of Rahim. Calculate the new
profit sharing ratio and sacrificing ratio.
13. Prema and Chandra share profits in the ratio of 5:3. Hema is admitted as a
partner. Prema surrendered 1/8 of her share and Chandra surrendered 1/8 of her
share in favour of Hema. Calculate the new profit sharing ratio and sacrificing
ratio.
14. Karthik and Kannan are equal partners. They admit Kailash with 1/4 share of
the profit. Kailash acquired his share from old partners in the ratio of 7:3.
Calculate the new profit sharing ratio and sacrificing ratio.
15. Selvam and Senthil are partners sharing profit in the ratio of 2:3. Siva is
admitted into the firm with 1/5 share of profit. Siva acquires equally from Selvam
and Senthil. Calculate the new profit sharing ratio and sacrificing ratio.
16. Mala and Anitha are partners, sharing profits and losses in the ratio of 3:2.
Mercy is admitted into the partnership with 1/5 share in the profits. Calculate new
profit sharing ratio and sacrificing ratio.
17. Ambika, Dharani and Padma are partners in a firm sharing profits in the ratio
of 5:3:2. They admit Ramya for 25% profit. Calculate the new profit sharing ratio
and sacrificing ratio.
18. Aparna and Priya are partners who share profits and losses in the ratio of
3:2. Brindha joins the firm for 1/5 share of profits and brings in cash for her share
of goodwill of 10,000. Pass necessary journal entry for adjusting goodwill on the
assumption that the fluctuating capital method is followed and the partners
withdraw the entire amount of their share of goodwill.

19. Deepak, Senthil and Santhosh are partners sharing profits and losses
equally. They admit Jerald into partnership for 1/3 share in future profits. The
goodwill of the firm is valued at 45,000 and Jerald brought cash for his share of
goodwill. The existing partners withdraw half of the amount of their share of
goodwill. Pass necessary journal entries for adjusting goodwill on the assumption
that the fluctuating capital method is followed.
20. Malathi and Shobana are partners sharing profits and losses in the ratio of
5:4. They admit Jayasri into partnership for 1/3 share of profit. Jayasri pays cash
` 6,000 towards her share of goodwill. The new ratio is 3:2:1. Pass necessary
journal entry for adjusting goodwill on the assumption that the fixed capital
method is followed.
21. Anu and Arul were partners in a firm sharing profits and losses in the ratio of
4:1. They have decided to admit Mano into the firm for 2/5 share of profits. The
goodwill of the firm on the date of admission was valued at ` 25,000. Mano is not
able to bring in cash for his share of goodwill. Pass necessary journal entry for
goodwill on the assumption that the fluctuating capital method is followed.
22. Varun and Barath are partners sharing profits and losses 5:4. They admit
Dhamu into partnership. The new profit sharing ratio is agreed at 1:1:1. Dhamu’s
share of goodwill is valued at ` 15,000 of which he pays `10,000 in cash. Pass
necessary journal entries for adjustment of goodwill on the assumption that the
fluctuating capital method is followed.
23. Sam and Jose are partners in a firm sharing profits and losses in the ratio of
3:2. On 1st April2018, they admitted Joel as a partner. On the date of Joel’s
admission, goodwill appeared in the books of the firm at ` 30,000. By assuming
fluctuating capital method, pass the necessary journal entry if the partners decide
to
(a) write off the entire amount of existing goodwill
(b) write off ` 20,000 of the existing goodwill.

www.nammakalvi.in

24. Rajan and Selva are partners sharing profits and losses in the ratio of 3:1.
Their balance sheet as on 31st March 2017 is as under:
Rajan 30,000 Stock 20,000
Selva 16,000 46,000 Debtors 16,000
Reserve fund 4,000 Cash at bank 12,500
Sundry creditors 37,500 Profit and loss 10,000

A/c
Buildings 25,000
Bills 3,000
receivables
87,500 87,500
On 1.4.2017, they admit Ganesan as a new partner on the following

arrangements:
(i) Ganesan brings `10,000 as capital for 1/5 share of profit.
(ii) Stock and furniture is to be reduced by 10%, a reserve of 5% on debtors for
doubtful debts is to be created.
(iii) Appreciate buildings by 20%.
the firm after admission.

25. Sundar and Suresh are partners sharing profits in the ratio of 3:2. Their
balance sheet as on 1st January, 2017 was as follows:
Sundar 30,000 Stock 25,000
Suresh 20,000 50,000 Debtors 15,000
Workmen 15,000 Furniture 13,000

compensation fund
Sundry creditors 50,000 Bills 14,000

receivables
1,25,000 1,25,000
They decided to admit Sugumar into partnership for 1/4 share in the profits on
the following terms:
(a) Sugumar has to bring in ` 30,000 as capital. His share of goodwill is valued at
` 5,000.
He could not bring cash towards goodwill.
(b) That the stock be valued at ` 20, 000.
(c) That the furniture be depreciated by ` 2,000.
(d) That the value of building be depreciated by 20%.

26. The following is the balance sheet of James and Justina as on 1.1.2017.
They share the profits and losses equally.
James 40,000 Stock 30,000
Justina 50,000 90,000 Debtors 20,000
Reserve fund 15,000 Prepaid 5,000

insurance
Sundry creditors 35,000 Cash at bank 15,000
1,40,000 1,40,000
On the above date, Balan is admitted as a partner with 1/5 share in future profits.
Following are the terms for his admission:
(i) Balan brings 25,000 as capital.
(ii) His share of goodwill is 10, 000 and he brings cash for it.
(iii) The assets are to be valued as under:
Building 80,000; Debtors 18,000; Stock 33,000

27. Anbu and Shankar are partners in a business sharing profits and losses in
the ratio of 3:2. The balance sheet of the partners on 31.03.2018 is as follows:
Capital accounts Computer 40,000
Anbu 4,00,000 Motor car 1,60,000
Shankar 3,00,000 7,00,000 Stock 4,00,000
Profit and loss 1,20,000 Debtors 3,60,000

compensation fund
Sundry creditors 1,20,000
10,00,000 10,00,000
Rajesh is admitted for 1/5 share on the following terms:

(i) Goodwill of the firm is valued at 75,000 and Rajesh brought cash for his share
of goodwill.
(ii) Rajesh is to bring 1,50,000 as his capital.
(iii) Motor car is valued at 2,00,000; stock at 3,80,000 and debtors at 3,50,000.
(iv) Anticipated claim on workmen compensation fund is 10,000
(v) Unrecorded investment of 5,000 has to be brought into account.
Prepare revaluation account, capital accounts and balance sheet after Rajesh’s
admission.

UNIT 6

1. Vivin, Hari and Joy are partners sharing profits and losses in the ratio of 3:2:1.
On 31.3.2017,Hari retired. On the date of retirement, the books of the firm
showed a general reserve of 60,000. Pass the journal entry to transfer the
general reserve.
2. Mary, Meena and Mariam are partners of a firm sharing profits and losses
equally. Mary retired from the partnership on 1.1.2019. On that date, their
balance sheet showed accumulated loss of 75,000 on the asset side of the
balance sheet. Give the journal entry to distribute the accumulated loss.
3. Prince, Dev and Sasireka are partners in a firm sharing profits and losses in
the ratio of 2:4:1. Their balance sheet as on 31 st March, 2019 is as follows:
Prince 30,000 Plant 50,000
Dev 50,000 Furniture 10,000
Sasireka 20,000 1,00,000 Stock 15,000

appropriation A/c
Workmen 17,000
compensation fund
1,50,000 1,50,000

4. Ramya, Sara and Thara are partners sharing profits and losses in the ratio of
5:3:2. On 1st April 2018, Thara retires and on retirement, the following
adjustments are agreed upon:
(i) Increase the value of premises by 40,000.
(ii) Depreciate stock by ` 3,000 and machinery by 6,500.
(iii) Provide an outstanding liability of 500
5. Prabu, Ragu and Siva are partners sharing profits and losses in the ratio of
3:2:1. Prabu retires from partnership on 1 st April 2017. The following adjustments
are to be made:
(i) Increase the value of building by 12,000
(ii) Reduce the value of furniture by 8,500
(iii) A provision would also be made for outstanding salary for 6,500.
6. John, James and Raja are partners in a firm sharing profits and losses equally.
Their balance sheet as on 31st March, 2019 is as follows:
Capital accounts Office 70,000

equipment
John 80,000 Machinery 1,40,000
James 60,000 Sundry Debtors 52,000
Raja 1,00,000 2,40,000 Less: provision 2,000 50,000

for bad &
doubtful debts
Sundry creditors 1,20,000 Stock 60,000
Cash at Bank 40,000
3,60,000 3,60,000

www.nammakalvi.in

Raja retired on 31st March, 2019 subject to the following conditions:

(i) Machinery is valued at 1,30,000
(ii) Value of office equipment is brought down by 2,000
(iii) Provision for doubtful debts should be increased to 3,000
(iv) Investment of 25,000 not recorded in the books is to be recorded now
Pass necessary journal entries and prepare revaluation account.
7. Kiran, Vinoth and Vimal are partners sharing profits in the ratio of 5:3:2. Kiran
retires and the new profit sharing ratio between Vinoth and Vimal is 2:1.
Calculate the gaining ratio.
8. Arya, Benin and Charles are partners sharing profits and losses in the ratio of
3:3:2. Charles retires and his share is taken up by Arya. Calculate the new profit
sharing ratio and gaining ratio of Arya and Benin.
9. Rahul, Ravi and Rohit are partners sharing profits and losses in the ratio of
5:3:2. Rohit retires and the share is taken by Rahul and Ravi in the ratio of 3:2.
Find out the new profit sharing ratio and gaining ratio.
10. Kumar, Kesavan and Manohar are partners sharing profits and losses in the
ratio of 1/2, 1/3 and 1/6 respectively. Manohar retires and his share is taken up
by Kumar and Kesavan equally. Find out the new profit sharing ratio and gaining
ratio.
11. Raja, Roja and Pooja are partners sharing profits in the ratio of 4:5:3. Roja
retires from the firm. Calculate the new profit sharing ratio and gaining ratio.
12. Suresh, Senthamarai and Raj were partners in a firm sharing profits and
losses in the ratio of 3:2:1. Suresh retired from partnership. The goodwill of the
firm on the date of retirement was valued at ` 36,000. Pass necessary journal
entries for goodwill on the assumption that the fluctuating capital system is
followed.
13. Naresh, Mani and Muthu are partners in a firm sharing profits and losses in
the ratio of 2:2:1. On 31st March 2019, Muthu retires from the firm. On the date of
Muthu’s retirement, goodwill appeared in the books of the firm at 40,000. By
assuming fluctuating capital method, pass the necessary journal entry if the
partners decide to
(b) write off half of the amount of existing goodwill.

14. Justina, Navi and Rithika are partners sharing profits and losses equally. On
31.3.2019, Rithika retired from the partnership firm. Profits of the preceding years
is as follows:
2016: 5,000; 2017: 10,000 and 2018: 30,000
Find out the share of profit of Ritika for the year 2019 till the date of retirement if
(a) Profit is to be distributed on the basis of the previous year’s profit
(b) Profit is to be distributed on the basis of the average profit of the past 3 years
Also pass necessary journal entries by assuming that partners’ capitals are
fluctuating.
15. Kavitha, Kumudha and Lalitha are partners sharing profits and losses in the
ratio of 5:3:3 respectively. Kumudha retires from the firm on 31st December, 2018.
On the date of retirement, her capital account shows a credit balance of
2,00,000. Pass journal entries if:
(i) The amount due is paid off immediately by cheque.
(ii) The amount due is not paid immediately.
(iii) ` 70,000 is paid immediately by cheque.
16. Mani, Rama and Devan are partners in a firm sharing profits and losses in

Mani 50,000 Stock 20,000
Rama 50,000 Furniture 70,000
Devan 50,000 1,50,000 Sundry Debtors 20,000
A/c
2,00,000 2,00,000

Mani retired from the partnership firm on 31.03.2019 subject to the following
adjustments:
(i) Stock to be depreciated by 5,000
(ii) Provision for doubtful debts to be created for 1,000.
(iii) Buildings to be appreciated by 16,000
(iv) The final amount due to Mani is not paid immediately
Prepare revaluation account and capital account of partners after retirement.
17. Charles, Muthu and Sekar are partners, sharing profits in the ratio of 3:4:2.
Their balance sheet as on 31st December, 2018 is as under:
Charles 30,000 Stock 40,000
Muthu 40,000 Sundry Debtors 30,000
Sekar 20,000 90,000 Cash at bank 42,000
Workmen 27,000 Profit & loss A/c 18,000

compensation
( loss)
fund
1,50,000 1,50,000
On 1.1.2019, Charles retired from the partnership firm on the following

arrangements.
(i) Stock to be appreciated by 10%
(ii) Furniture to be depreciated by 5%
(iii) To provide 1,000 for bad debts
(iv) There is an outstanding repairs of 11,000 not yet recorded
(v) The final amount due to Charles was paid by cheque
the firm after retirement.

18. Raghu, Ravi and Ramesh are partners in a firm sharing profits and losses in
the ratio of 2:3:1. Their balance sheet as on 31 st March, 2019 was as follows:
Raghu 30,000 Machinery 70,000
Ravi 40,000 Stock 20,000
Ramesh 20,000 90,000 Debtors 18,000
Reserve fund 36,000 Less: provision for 1,000 17,000

bad & doubtful
debts
1,76,000 1,76,000
Ramesh retires on 31.3.2019 subject to the following conditions:

(i) Goodwill of the firm is valued at 24,000
(ii) Machinery to be depreciated by 10%
(iii) Buildings to be appreciated by 20%
(iv) Stock to be appreciated by 2,000
(v) Provision for bad debts to be raised by 1,000
(vi) Final amount due to Ramesh is not paid immediately
Prepare the necessary ledger accounts and show the balance sheet of the firm
after retirement.
19. Muthu, Murali and Manoj are partners in a firm and sharing profits and losses
in the ratio 3:1:2. Their balance sheet as on 31 st December, 2018 is given below:
Liabilities Amount Amount Assets Amoun Amount

t

Muthu 20,000 Furniture 5,000
Murali 25,000 Debtors 30,000
Manoj 20,000 65,000 Stock 20,000
General 6,000
Reserve
1,00,000 1,00,000
Manoj retires on 31st December, 2018 subject to the following conditions:

(i) Muthu and Murali will share profits and losses in the ratio of 3:2
(ii) Assets are to be revalued as follows:
Machinery 43,000, stock 27,000, debtors 28,000.
(iii) Goodwill of the firm is valued at 30,000
(iv) The final amount due to Manoj is not paid immediately
Prepare necessary ledger accounts and the balance sheet immediately after the
retirement of Manoj.
20. Rathna, Baskar and Ibrahim are partners sharing profits and losses in the
ratio of 2:3:4 respectively. Rathna died on 31st December, 2018. Final amount
due to her showed a credit balance of 1,00,000. Pass journal entries if,
(a) The amount due is paid off immediately by cheque.
(b) The amount due is not paid immediately.
(c) 60,000 is paid immediately by cheque.

www.nammakalvi.in

21. Sundar, Vivek and Pandian are partners, sharing profits in the ratio of 3:2:1.
Their balance sheet as on 31st December, 2018 is as under:
Sundar 50,000 Stock 20,000
Vivek 40,000 Debtors 30,000
Pandiyan 10,000 1,00,000 Cash at bank 14,000
General 36,000 Profit & loss A/c 6,000

Reserve (loss)
1,50,000 1,50,000
On 1.1.2019, Pandian died and on his death the following arrangements are
made:
(i) Stock to be depreciated by 10%
(ii) Land is to be appreciated by 11,000
(iii) Reduce the value of debtors by 3,000
(iv) The final amount due to Pandian was not paid
the firm after death.

22. Ramesh, Ravi and Akash are partners who share profits and losses in their
capital ratio. Their balance sheet as on 31.12.2017 is as follows:

t
Capital accounts Plant and Machinery 45,000
Ramesh 30,000 Stock 22,000
Ravi 30,000 Debtors 15,000
Akash 20,000 80,000 Cash at bank 10,000
General 8,000 Cash in hand 4,000

Reserve
96,000 96,000
Akash died on 31.3.2018. On the death of Akash, the following adjustments are
made:
(i) Plant and machinery is to be valued at ` 54,000
(ii) Stock is to be depreciated by ` 1,000
(iii) Goodwill of the firm is valued at ` 24,000
(iv) Share of profit of Akash is to be calculated from the closing of the last
financial year to the date of death on the basis of the average of the three
completed years’ profit before death. Profit for 2015, 2016 and 2017 were `
66,000, ` 60,000 and ` 66,000 respectively.
Prepare the necessary ledger accounts and the balance sheet immediately after
the death of Akash.

EXERCISE PROBLEMS
1. Dheena, Surya and Janaki are partners sharing profits and losses in the ratio
of 5:3:2. On 31.3.2018, Dheena retired. On the date of retirement, the books of
the firm showed a reserve fund of 50,000. Pass journal entry to transfer the
reserve fund.
2. Rosi, Rathi and Rani are partners of a firm sharing profits and losses equally.
Rathi retired from the partnership on 1.1.2018. On that date, their balance sheet
showed accumulated loss of 45,000 on the asset side of the balance sheet. Give
the journal entry to distribute the accumulated loss.
3. Akash, Mugesh and Sanjay are partners in a firm sharing profits and losses in
Capital accounts Buildings 1,10,000
Akash 40,000 Vechicle 30,000
Mukesh 60,000 Stock in trade 26,000
Sanjay 50,000 1,50,000 Debtors 25,000
Profit and loss 12,000 Cash in hand 15,000

appropriation A/c
General reserve 24,000
Workmen 18,000
compensation fund
Bills payable 2,000
2,06,000 2,06,000
Pass journal entry to transfer accumlatetd Profit and prepare the capital account of
th partners

4. Roja, Neela and Kanaga are partners sharing profits and losses in the ratio of
4:3:3. On 1 April 2017, Roja retires and on retirement, the following adjustments
st
are agreed upon.

(i) Increase the value of building by 30,000.
(ii) Depreciate stock by 5,000 and furniture by 12,000.
(iii) Provide an outstanding liability of 1,000
5. Vinoth, Karthi and Pranav are partners sharing profits and losses in the ratio of
2:2:1. Pranav retires from partnership on 1st April 2018. The following
adjustments are to be made.
(i) Increase the value of land and building by 18,000
(ii) Reduce the value of machinery by 15,000
(iii) A provision would also be made for outstanding expenses for 8,000.
6. Chandru, Vishal and Ramanan are partners in a firm sharing profits and losses
equally. Their balance sheet as on 31st March, 2018 is as follows:
Capital accounts Funniture 60,000
Chandru 60,000 Machinery 1,20,000
Vishal 70,000 Sundry Debtors 33,000
Ramanan 70,000 2,00,000 Less: provision for 3,000 30,000

bad & doubtful
debts
Bills payable 80,000 Bills receivables 50,000
Cash at Bank 20,000
2,80,000 2,80,000

Ramanan retired on 31st March 2019 subject to the following conditions:

(i) Machinery is valued at 1,50,000
(ii) Value of furniture brought down by 10,000
(iii) Provision for doubtful debts should be increased to 5,000
(iv) Investment of ` 30,000 not recorded in the books is to be recorded now.
Pass necessary journal entries and prepare revaluation account.
7. Kayal, Mala and Neela are partners sharing profits in the ratio of 2:2:1. Kayal
retires and the new profit sharing ratio between Nila and Neela is 3:2. Calculate
the gaining ratio.
8. Sunil, Sumathi and Sundari are partners sharing profits in the ratio of 3:3:4.
Sundari retires and her share is taken up entirely by Sunil. Calculate the new
profit sharing ratio and gaining ratio.
9. Ramu, Somu, Gopu are partners sharing profits in the ratio of 3:5:7. Gopu
retires and the share is purchased by Ramu and Somu in the ratio of 3:1. Find
the new profit sharing ratio and gaining ratio.
10. Navin, Ravi and Kumar are partners sharing profits in the ratio of 1/2, 1/4 and
¼ respectively. Kumar retires and his share is taken up by Navin and Ravi
equally. Calculate the new profit sharing ratio and gaining ratio.
11. Mani, Gani and Soni are partners sharing the profits and losses in the ratio of
4:5:6. Mani retires from the firm. Calculate the new profit sharing ratio and
gaining ratio.
12. Rajan, Suman and Jegan were partners in a firm sharing profits and losses in
the ratio of 4:3:2. Suman retired from partnership. The goodwill of the firm on the
date of retirement was valued at ` 45,000. Pass necessary journal entries for
goodwill on the assumption that the fluctuating capital method is followed.
13. Balu, Chandru and Nirmal are partners in a firm sharing profits and losses in
the ratio of 5:3:2. On 31st March 2018, Nirmal retires from the firm. On the date of
Nirmal’s retirement, goodwill appeared in the books of the firm at 60,000. By
assuming fluctuating capital account, pass the necessary journal entry if the
partners decide to
(b) write off half of the existing goodwill.

14. Rani, Jaya and Rathi are partners sharing profits and losses in the ratio of
2:2:1. On 31.3.2018, Rathi retired from the partnership. Profit of the preceding
years is as follows:
2014: 10,000; 2015: 20,000; 2016: 18,000 and 2017: 32,000
Find out the share of profit of Rathi for the year 2018 till the date of retirement if
(a) Profit is to be distributed on the basis of the previous year’s profit
(b) Profit is to be distributed on the basis of the average profit of the past 4 years
Also pass necessary journal entries by assuming partners capitals are
fluctuating.
15. Kavin, Madhan and Ranjith are partners sharing profits and losses in the ratio
of 4:3:3 respectively. Kavin retires from the firm on 31st December, 2018. On the
date of retirement, his capital account shows a credit balance of 1,50,000. Pass
journal entries if:
(a) The amount due is paid off immediately.
(c) 1,00,000 is paid and the balance in future.
16. Manju, Charu and Lavanya are partners in a firm sharing profits and losses in
Capital accounts Buildings 1,00,000
Manju 70,000 Furniture 80,000
Charu 70,000 Stock 60,000
Lavanya 70,000 2, 10,000 Sundry Debtors 40,000

A/c
3,00,000 3,00,000
Manju retired from the partnership firm on 31.03.2018 subject to the following
adjustments:

www.nammakalvi.in


(ii) Provision for doubtful debts to be created for 3,000.
(iii) Buildings to be appreciated by 28,000
Prepare revaluation account and capital accounts of partners after retirement.
17. Kannan, Rahim and John are partners in a firm sharing profit and losses in
the ratio of
5:3:2. The balance sheet as on 31st December, 2017 was as follows:
Kannan 1,00,000 Machinery 60,000
Rahim 80,000 Sundry Debtors 30,000
John 40,000 2,20,000 Stock 20,000

compensation
fund
Sundry creditors 20,000 Profit & loss A/c 20,000
( loss)
2,70,000 2,70,000
John retires on 1st January 2018, subject to following conditions:

(i) To appreciate building by 10%
(ii) Stock to be depreciated by 5%.
(iii) To provide `1,000 for bad debts
(iv) An unrecorded liability of `8,000 have been noticed.
(v) The retiring partner shall be paid immediately.
the firm after retirement.

18. Saran, Arun and Karan are partners in a firm sharing profits and losses in the
ratio of 4:3:3. Their balance sheet as on 31.12.2016 was as follows:
Saran 60,000 Machinery 40,000
Arun 50,000 Stock 12,000
Karan 40,000 1,50,000 Debtors 25,000
Reserve fund 15,000 Less: provision for 1,000 24,000

bad & doubtful
debts
Investments 20,000
2,00,000 2,00,000
Karan retires on 1.1.2017 subject to the following conditions:

(i) Goodwill of the firm is valued at 21,000
(ii) Machinery to be appreciated by 10%
(iii) Building to be valued at 80,000
(iv) Provision for bad debts to be raised to 2,000
(v) Stock to be depreciated by 2,000
(vi) Final amount due to Karan is not paid immediately
Prepare the necessary ledger accounts and show the balance sheet of the firm
after retirement.

19. Rajesh, Sathish and Mathan are partners sharing profits and losses in the
ratio of 3:2:1 respectively. Their balance sheet as on 31.3.2017 is given below.
Capital accounts Premises 4,00,000
Rajesh 4,00,000 Machinery 4,20,000
Sathish 3,00,000 Debtors 1,60,000
Mathan 2,50,000 9,50,000 Stock 3,00,000
General 1,20,000 Cash at bank 20,000

Reserve
Bills payable 1,80,000
13,00,000 13,00,000
Mathan retires on 31st March, 2017 subject to the following conditions:

(i) Rajsh and Sathish will share profits and losses in the ratio of 3:2
(ii) Assets are to be revalued as follows:
Machinery 3,90,000, Stock 2,90,000, Debtors 1,52,000.
(iii) Goodwill of the firm is valued at 1,20,000
Prepare necessary ledger accounts and the balance sheet immediately after the
retirement of Mathan.
20. Janani, Janaki and Jamuna are partners sharing profits and losses in the
ratio of 3:3:1
respectively. Janaki died on 31st December, 2017. Final amount due to her
showed a credit balance of 1,40,000. Pass journal entries if,
(a) The amount due is paid off immediately.
(c) 75, 000 is paid and the balance in future.

21. Varsha, Shanthi and Madhuri are partners, sharing profits in the ratio of 5:4:3.
Their balance sheet as on 31st December 2017 is as under:
t
Capital accounts Premises 1,20,000
Varsha 80,000 Stock 40,000
Shanthi 60,000 Debtors 50,000
Madhuri 20,000 1,60,00 Cash at bank 18,000

0
General 48,000 Profit & loss A/c 12,000

Reserve (loss)
2,40,00 2,40,000
0
On 1.1.2018, Madhuri died and on her death the following arrangements are
made:
(ii) Premises is to be appreciated by 20%
(iii) To provide 4,000 for bad debts
(iv) The final amount due to Madhuri was not paid
the firm after death.

22. Vijayan, Sudhan and Suman are partners who share profits and losses in
their capital ratio. Their balance sheet as on 31.12.2018 is as follows:
Capital accounts Building 80,000
Vijayan 70,000 Stock 45,000
Sudhan 50,000 Debtors 25,000
Suman 30,000 1,50,000 Cash at bank 20,000
General 18,000 Cash in hand 15,000

Reserve
1,85,000 1,85,000
Suman died on 31.3.2019. On the death of Suman, the following adjustments are
made:
(i) Building is to be valued at 1,00,000
(ii) Stock to be depreciated by 5,000
(iii) Goodwill of the firm is valued at 36,000
(iv) Share of profit from the closing of the last financial year to the date of death
on the basis of the average of the three completed years’ profit before death.
Profit for 2016, 2017 and 2018 were 40,000, 50,000 and 30,000 respectively.
Prepare the necessary ledger accounts and the balance sheet immediately after
the death of Suman.

UNIT 7
COMPANY ACCOUNTS
STD: XII
ILLUSTRATIONS:
1. Thai Ltd. issued 1,00,000 equity shares of ` 10 each, payable 5 on

application, 2 on allotment, 2 on first call and 1 on final call. All the shares are
subscribed and amount was duly received. Pass journal entries.
2. Joy Company issued 10,000 equity shares at 10 per share payable 5 on

application, 3 on allotment and 2 on first and final call. The public subscribed
for 9,000 shares. The directors allotted all the 9,000 shares and duly received the
money. Pass the necessary journal entries.
3. Bharath Ltd. issued 1,00,000 equity shares of 10 each to the public at par.
The details of the amount payable on the shares are as follows:
On application 5 per share
On allotment 3 per share
On first and final call 2 per share
Application money was received for 1,20,000 shares. Excess application money
was refunded immediately. Pass journal entries to record the above.
4. Khan Ltd. issued 50,000 shares of 10 each to the public payable 4 on

application, 4 on allotment and 2 on first and final call. Applications were
received for 65,000 shares. The directors decided to allot 50,000 shares on pro
rata basis and surplus application money was utilised for allotment. Pass journal
entries assuming that the amounts due were received.
5. Sudha Ltd. offered 1,00,000 shares of 10 each to the public payable 3 on

application, 4 on share allotment and the balance when required. Applications
for 1,40,000 shares were received on which the directors allotted as:
Applicants for 60,000 shares - Full
Applicants for 75,000 shares - 40,000 shares (excess money will be utilised for
allotment) Applicants for 5,000 shares - Nil
All the money due was received. Pass journal entries upto the receipt of
allotment.

www.nammakalvi.in

6. Aruna Mills Ltd. with a registered capital of 5,00,000 in equity shares of 10

each, issued 20,000 of such shares payable as follows; 4 per share on
application, 4 per share on allotment and 2 per share on first and final call. The
issue was duly subscribed.
All the money payable was duly received. But on allotment, one shareholder paid
the entire balance on his holding of 300 shares. Give journal entries to record the
above.
7. Jeyam Tyres issued 15,000 ordinary shares of 10 each payable as follows:

3 on application; 5 on allotment; 2 on first and final call. All money were duly
received except one shareholder holding 100 shares failed to pay the call money.
Pass the necessary journal entries for call (using calls in arrear account).
8. Anitha was holding 500 equity shares of 10 each of Thanjavur Motors Ltd,
issued at par. She paid 3 on application, 5 on allotment but could not pay the
first and final call of 2. The directors forfeited the shares for nonpayment of call
money. Give Journal entry for forfeiture of shares.
9. Muthu was holding 20 equity shares of 10 each on which he paid 2 on

application but could not pay 3 on allotment and 1 on first call. Directors forfeited
the shares after the first call. Give journal entry for recording the forfeiture of
shares.
10. Anu Company forfeited 200 equity shares of 10 each issued at par held by
Thiyagu for nonpayment of the final call of 3 per share. The shares were
reissued to Laxman at 6 per share. Show the journal entries for forfeiture and
reissue.
11. Maruthu Ltd. forfeited 150 equity shares of 10 each for non payment of final
call of 4 per share. Of these 100 shares were reissued @ 9 per share. Pass
journal entries for forfeiture and reissue.
12. Gemini Ltd. forfeited 20 equity shares of 10 each, 7 called up, on which
Mahesh had paid application and allotment money of 5 per share. Of these 15
shares were reissued to Naresh by receiving 6 per share paid up as 7 per
share. Pass journal entries for forfeiture and reissue.

13. Jenifer Ltd. issued 10,000 equity shares of 10 each at par payable on
application 3 per share, on allotment 3 per share, on first call 2 per share and
on second and final call 2 per share. The issue was fully subscribed and all the
amounts were duly received with the exception of 100 shares held by Subbu,
who failed to pay the second and final call. His shares were forfeited and
reissued to Hema at 7 per share. Journalise the above transactions.
14. X company issued 10,000 equity shares of` 10 each payable as under:
On application 2
On allotment 4
On first call 2
On final call 2
Applications were received for 30,000 shares. Applications for 10,000 shares
were rejected and allotment was made proportionately towards remaining
applications and the excess application money is adjusted towards allotment
money. The directors made both the calls and the all the amount were received
except the final call on 600 shares which were subsequently forfeited. Later 400
forfeited shares were reissued as fully paid by receiving 7 per share. Give
journal entries.
15. Shero Health Care Ltd. invited applications for 3,00,000 equity shares of 10
each at a premium of 2 per share payable as follows:
3 on application
5 (including premium) on allotment
4 on first and final call
There was over subscription and applications were received for 4,00,000 shares
and the excess applications were rejected by the directors. All the money due
were received. Pass the journal entries.
16. Keerthiga Company issued shares of ` 10 each at 10% premium, payable 2

on application, 3 on allotment (including premium), 3 on first call and 3 on
second and final call. Journalise the transactions relating to forfeiture of shares
for the following situations:
(i) Mohan who holds 50 shares failed to pay the second and final call and his
shares were forfeited.
(ii) Mohan who holds 50 shares failed to pay the allotment money, first call and
second and final call money and his shares were forfeited.
(iii) Mohan who holds 50 shares failed to pay the allotment money and first call
and his shares were forfeited after the first call.

17. Divya Ltd. allotted 10,000 equity shares of 10 each at a premium of 2 per
share to applicants of 14,000 shares on a pro rata basis. The excess application
money will be adjusted towards allotment money. The amount payable was 2 on
application, 5 on allotment (including premium of 2 each) and 3 on first call and
2 on final call. Vikas, a shareholder failed to pay the first call and final call on his
300 shares. All the shares were forfeited and out of them 200 shares were
reissued @ ` 9 per share. Pass the necessary journal entries.
18. Thangam Ltd. issued 50,000 shares of 10 each at a premium of 2 per share
payable as follows:
On application 5
On allotment 5 (including premium)
On first and final call 2
Issue was fully subscribed and the amounts due were received except Priya to
whom 500 shares were allotted who failed to pay the allotment money and fist
and final call money. Her shares were forfeited. All the forfeited shares were
reissued to Devi at 8 per share. Pass journal entries.
19. Sara Company issues 10,000 equity shares of 10 each payable fully on
application.
Pass journal entries if the shares are issued
(i) at par
(ii) at a premium of 2 per share.
20. Rajan Ltd. purchased machinery of 6,00,000 from Jagan Traders. It issued
equity shares of 10 each fully paid in satisfaction of their claim. What entries will
be made if such issue is made: (a) at par and (b) at a premium of 50%.

EXERCISE PROBLEMS
1. Progress Ltd. issued 50,000 ordinary shares of 10 each, payable 2 on
application, 4 on allotment, 2 on first call and 2 on final call. All the shares are
subscribed and amount was duly received. Pass journal entries.
2. Sampath company issued 25,000 shares at 10 per share payable 3 on

application, 4 on allotment, 3 on first and final call. The public subscribed for
24,000 shares. The directors allotted all the 24,000 shares and received the
money duly. Pass necessary journal entries.
3. Saranya Ltd. issued 20,000 equity shares of 10 each to the public at par. The
details of the amount payable on the shares are as follows:
On application 3 per share
On allotment 4 per share
On first and final call 3 per share
Application money was received on 30,000 shares. Excess application money
was refunded immediately. Pass journal entries to record the above.
4. Gaja Ltd issued 40,000 shares of 10 each to the public payable 2 on

application, 5 on allotment and 3 on first and final call. Applications were
received for 50,000 shares.
The Directors decided to allot 40,000 shares on pro rata basis and surplus of
application money was utilised for allotment. Pass journal entries assuming that
the amounts due were received.
5. Lalitha Ltd. offered 30,000 equity shares of 10 each to the public payable 2
per share on application, 3 on share allotment and the balance when required.
Applications for 50,000 shares were received on which the directors allotted as:
Applicants for 10,000 shares - Full
Applicants for 35,000 shares - 20,000 shares (excess money will be utilised for
allotment) Applicants for 5,000 shares - Nil
All the money due was received. Pass journal entries upto the receipt of
allotment.

6. Anjali Flour Ltd. with a registered capital of ` 4,00,000 in equity shares of 10

each, issued 30,000 of such shares; payable 2 per share on application, 5 per
share on allotment and 3 share on first call. The issue was duly subscribed.
All the money payable was duly received but on allotment, one shareholder paid
the entire balance on his holding of 500 shares. Give journal entries to record the
transactions.
7. Muthu Ltd. issued 50,000 shares of 10 each payable as follows; 2 on

application; 4 on allotment; 4 on first and final call.
All money were duly received except one shareholder holding 1,000 shares failed
to pay the call money. Pass the necessary journal entries for calls by using calls
in arrear account.
8. Arjun was holding 1,000 shares of 10 each of Vanavil Electronics Ltd, issued
at par. He paid 3 on application, 4 on allotment but could not pay the first and
final call of 3.
The directors forfeited the shares for nonpayment of call money. Give Journal
entry for
forfeiture of shares.
9. Lakshith was holding 50 shares of 10 each on which he paid 2 on application

but could not pay 4 on allotment and 2 on first call. Directors forfeited the shares
after the first call. Give journal entry for recording the forfeiture of shares.
10. Goutham Ltd. forfeited 500 equity shares of 10 each issued at par held by
Ragav for
nonpayment of the final call of 2 per share. The shares were forfeited and
reissued to
Madhan at 8 per share. Show the journal entries for forfeiture and reissue.
11. Nivetha Ltd. forfeited 1,000 equity shares of 10 each for non payment of call
of 4 per share. Of these 800 shares were reissued @ 7 per share. Pass journal
entries for forfeiture and reissue.
12. Nathiya Textiles Ltd. forfeited 100 shares of 10 each, 8 called up, on which
Mayuri had paid application and allotment money of 6 per share. Of these 75
shares were re-issued to Soundarya by receiving 7 per share paid up as 8 per
share. Pass journal entries for forfeiture and reissue.

13. Simon Ltd issued 50,000 equity shares of 10 each at par payable on
application 1 per share, on allotment 5 per share, on first call 2 per share and on
second and final call 2 per share. The issue was fully subscribed and all the
amounts were duly received with the exception of 2,000 shares held by
Chezhian, who failed to pay the second and final call. His shares were forfeited
and reissued to Elango at 8 per share. Journalise the above transactions.
14. Kanchana Ltd. issued 50,000 shares of 10 each payable as under.

On application 1
On allotment 5
On first call 2
On final call 2
Applications were received for 70,000 shares. Applications for 8,000 shares were
rejected and allotment was made proportionately towards remaining applications.
The directors made both the calls and the all the amount were received except
the final call on 1,500 shares which were subsequently forfeited. Later 1,200
forfeited shares were reissued by receiving 8 per share. Give journal entries.
15. Viswanath Furniture Ltd. invited applications for 20,000 shares of 10 each at
a premium of 2 per share payable.
2 on application
5 (including premium) on allotment
5 on first and final call
There was over subscription and applications were received for 30,000 shares
and the excess applications were rejected by the directors. All the money due
were received. Pass the journal entries.
16. United Industries Ltd. issued shares of 10 each at 10% premium payable 3
on application, 4 on allotment (including premium), 2 on first call and 2 on
second and final call. Journalise the transactions relating to forfeiture of shares
for the following situations:
(i) Manoj who holds 250 shares failed to pay the second and final call and his
shares were forfeited.
(ii) Manoj who holds 250 shares failed to pay the allotment money and first call
and second and final call and his shares were forfeited.
(iii) Manoj who holds 250 shares failed to pay the allotment money and first call
money and his shares were forfeited after the first call.

www.nammakalvi.in

17. Kasthuri Ltd. had allotted 20,000 shares of 10 each at a premium of 2 each
to applicants of 30,000 shares on a pro rata basis. The amount payable was 1
on application, 5 on allotment (including premium of 2 each) and 2 on first call
and 2 on final call. Subin, a shareholder failed to pay the first call and final call
on his 500 shares. All the shares were forfeited and out of them 400 shares were
reissued @ 8 per share. Pass necessary journal entries.
18. Vairam Ltd. issued 60,000 shares of 10 each at a premium of 2 per share
payable as follows:
On application 6
On allotment 4 (including premium)
On first and final call 2
Issue was fully subscribed and the amounts due were received except Saritha to
whom 1,000 shares were allotted who failed to pay the allotment money and first
and final call money. Her shares were forfeited. All the forfeited shares were
reissued to Parimala at 7 per share. Pass journal entries.
19. Abdul Ltd. issues 50,000 shares of 10 each payable fully on application.
Pass journal entries if shares are issued (i) at par (ii) at a premium of 3 per
share.
20. Paradise Ltd. purchased assets of 4,40,000 from Suguna Furniture Ltd. It
issued equity shares of 10 each fully paid in satisfaction of their claim. What
entries will be made if such issue is: (a) at par and (b) at premium of 10%.

UNIT 8
STD: XII
ILLUSTRATIONS:
1. From the following particulars, prepare comparative income statement of Tharun Co.
Ltd.
Particulars 2016 -17 2017 - 18
Revenue from operations 2,00,000 2,50,000
Other income 50,000 40,000
Expenses 1,50,000 1,20,000
2. From the following particulars, prepare comparative income statement of Abdul Co.
Ltd.
PARTICULARS 2015 -16 2016 - 17
Other income 1,00,000 40,000
Expenses 2,00,000 1,20,000
Income tax 30% 30%
3. From the following particulars, prepare comparative income statement of Mary Co.
Ltd.
PARTICULARS 2015 -16 2016 - 17
Operating expenses 2,00,000 1,80,000
Income tax 20% 50%

4. From the following balance sheet of Chandra Ltd, prepare comparative balance sheet
as on 31st March 2016 and 31st March 2017.
Particulars 31st March 2016 31st March 2017
I EQUITY AND LIABILITIES
Shareholders’ fund 1,00,000 2,60,000
Non-current liabilities 50,000 60,000
Current liabilities 25,000 30,000
Total 1,75,000 3,50,000
II ASSETS
Non-current assets 1,00,000 2,00,000
Current assets 75,000 1,50,000
Total 1,75,000 3,50,000
5. From the following particulars, prepare comparative balance sheet of Malar Ltd
as on 31 March 2016 and 31st March 2017.
st
1. Shareholders’ fund
a) Share capital 2,00,000 2,50,000
b) Reserves and surplus 50,000 50,000
2. Non-current liabilities
Long-term borrowings 30,000 60,000
3. Current liabilities
Trade payables 20,000 60,000
Total 3,00,000 4,20,000

II ASSETS
1. Non-current assets 1,00,000 1,50,000

a) Fixed assets
b) Non - current investments 50,000 75,000
2. Current assets
Inventories 75,000 1,50,000
Cash and cash equivalents 75,000 45,000
Total 3,00,000 4,20,000
6. From the following particulars of Kumar Ltd, prepare a common-size income

statement for the year ended 31st March, 2018.
PARTICULARS 2017 -18
Revenue from operations 5,00,000
Other income 20,000
Expenses 3,00,000
7. From the following particulars of Mani Ltd an Kani Ltd prepare a common-size
income statement for the year ended 31st March, 2019.
PARTICULARS MANI LTD KANI LTD
Expenses 1,10,000 1,25,000

8. From the following particulars of Siva Ltd, prepare common size income
statement for the years ended 31st March, 2016 and 31st March, 2017.
PARTICULARS 2015 -16 2016 - 17
Expenses 2,50,000 1,50,000
Income tax 40% 40%
9. Prepare common-size balance sheet of Maria Ltd. as on 31st March, 2018.
Particulars 31st March 2018
Shareholders’ fund 4,00,000
Non-current liabilities 3,20,000
Total 8,00,000
II ASSETS
Non-current assets 6,00,000
Current assets 2,00,000
Total 8,00,000

www.nammakalvi.in

10. Prepare common-size balance sheet of Sharmila Ltd. and Sangeetha Ltd. as
on 31st March, 2019.
Particulars Sharmila Ltd Sangeetha Ltd
Non-current liabilities 4,00,000 7,00,000
Current liabilities 1,00,000 2,00,000
Total 10,00,000 20,00,000
II ASSETS
Current assets 3,50,000 2,00,000
Total 10,00,000 20,00,000
11. Prepare common-size statement of financial position of Saleem Ltd as on

31st March, 2017 and 31st March, 2018.
a) Share capital 5,00,000 6,00,000
b) Reserves and surplus 4,00,000 3,60,000
Long-term borrowings 8,00,000 2,40,000
Trade payables 3,00,000 -
Total 20,00,000 12,00,000

II ASSETS
1. Non-current assets
a) Fixed assets 10,00,000 6,00,000
b) Non - current investments 5,00,000 2,40,000
2. Current assets
Inventories 3,00,000 1,20,000
Cash and cash equivalents 2,00,000 2,40,000
Total 20,00,000 12,00,000
12. Calculate trend percentages for the following particulars of Kurinji Ltd.
PARTICULARS 2015 -16 2016 – 17 2017 – 18
in thousands in thousands in thousands

Revenue from 120 132 156
operations
Other income 50 38 65
Expenses 100 135 123
13. From the following information, calculate trend percentages for Mullai Ltd.
PARTICULARS 2015 -16 2016 – 17 2017 – 18
in lakhs in lakhs in lakhs

operations
Expenses 20 14 40
Income tax 30% 30% 30%

14. From the following particulars of Neithal Ltd, calculate trend percentages.
PARTICULARS 2015 -16 2016 – 17 2017 – 18

operations
Expenses 125 75 50
15. Calculate trend percentages for the following particulars of Palai Ltd.
Particulars YEAR – I YEAR – YEAR – III

II
in lakhs in lakhs
in lakhs
Shareholders’ fund 250 275 300
Non-current liabilities 100 125 100
Current liabilities 50 40 80
Total 400 440 480
II ASSETS
Non-current assets 300 360 390
Current assets 100 80 90
Total 400 440 480

16. Compute trend percentages for the following particulars of Boomi Ltd.
Particulars YEAR – I YEAR – II YEAR – III
a) Share capital 200 254 212
b) Reserves and surplus 60 60 90
Long-term borrowings 140 154 168
Trade payables 40 60 80
Total 440 528 550
II ASSETS
a) Fixed assets 200 236 206
b) Non - current investments 80 100 120
2. Current assets
Inventories 120 132 144
Cash and cash equivalents 40 60 80
Total 440 528 550

EXERCISE PROBLEMS
1. From the following particulars, prepare comparative income statement of Arul
Ltd.
PARTICULARS 2015 -16 2016 - 17
Revenue from operations 50,000 60,000
Expenses 40,000 50,000
2. From the following particulars, prepare comparative income statement of

Barani Ltd.
PARTICULARS 2016 -17 2017 - 18
Expenses 10,000 15,000
Income tax 30% 30%
3. From the following particulars, prepare comparative income statement of

Daniel Ltd.
PARTICULARS 2015 -16 2016 - 17
Operating expenses 25,000 27,500
Income tax 30% 30%

4. From the following particulars, prepare comparative statement of financial

position of Muthu Ltd.
Current liabilities 75,000 82,500
Total 6,25,000 6,87,500
II ASSETS
Current assets 1,25,000 87,500
Total 6,25,000 6,87,500
5. From the following particulars, prepare comparative statement of financial

position of Kala Ltd.
Shareholders’ fund
a) Share capital 3,00,000 3,60,000
Non-current liabilities
Long term borrowings 50,000 40,000
Current liabilities
Total 4,20,000 4,62,000

II ASSETS
Non-current assets
a) Fixed assets 2,50,000 2,90,000
b) Non - current investments 50,000 40,000

Inventories 80,000
Total 4,20,000 4,62,000
6. Prepare common-size income statement for the following particulars of Raja

Ltd. For the year ended 31st March, 2017
PARTICULARS 2016 -17
Other income 67,500
Expenses 1,35,000
7. From the following particulars of Maria Ltd. and Kala Ltd. prepare a common-
size income statement for the year ended 31st March, 2019.
PARTICULARS MARIYA LTD KALA LTD
Expenses 70,000 1,20,000

www.nammakalvi.in

8. Prepare common-size income statement for the following particulars of Sam

Ltd.
PARTICULARS 2015 -16 2016 - 17
Expenses 2,40,000 2,50,000
Income tax 30% 30%
9. Prepare Common-size balance sheet of Meena Ltd. as on 31st March, 2018.
Particulars 31st March 2018
Shareholders’ fund 2,00,000
Non-current liabilities 1,60,000
Total 4,00,000
II ASSETS
Non-current assets 3,00,000
Total 4,00,000

10. Prepare common-size statement of financial position for the following

particulars of Rani Ltd.
Particulars 31st March, 2016 31st March, 2017
Current liabilities 90,000 1,50,000
Total 9,00,000 10,00,000
II ASSETS
Current assets 1,80,000 2,00,000
Total 9,00,000 10,00,000
11. Prepare common-size statement of financial position for the following

particulars of Yasmin Ltd. and Sakthi Ltd.
a) Share capital 2,00,000 3,00,000
Long-term borrowings 1,50,000 1,80,000
Trade payables 1,00,000 60,000
Total 5,00,000 6,00,000

II ASSETS
a) Fixed assets 2,00,000 3,00,000
b) Non - current investments 50,000 1,20,000
2. Current assets
Inventories 2,00,000 90,000
Total 5,00,000 6,00,000
12. From the following particulars, calculate the trend percentages of Kala Ltd.
PARTICULARS 2015 -16 2016 – 17 2017 – 18

operations
13. From the following particulars, calculate the Trend percentages of Kavitha
Ltd.
PARTICULARS 2015 -16 2016 – 17 2017 – 18

operations
Expenses 100 120 80

14. From the following particulars, calculate the trend percentages of Kumar Ltd.
PARTICULARS 2015 -16 2016 – 17 2017 – 18

operations
15. From the following particulars, calculate the trend percentages of Anu Ltd.
in thousands In thousands in thousands
I EQUITY AND LIABILITIES 500 550 600
Shareholders’ fund
Non-current liabilities 200 250 240
Current liabilities 100 80 120
Total 800 880 960
II ASSETS
Non-current assets 600 720 780
Current assets 200 160 180
Total 800 880 960

16. From the following particulars, calculate the trend percentages of Babu Ltd.
a) Share capital 100 127 106
b) Reserves and surplus 30 30 45
Long-term borrowings 70 77 84
Trade payables 20 30 40
Total 220 264 275
II ASSETS
a) Fixed assets 100 118 103
b) Non - current investments 40 50 60
2. Current assets
Inventories 60 66 72
Cash and cash equivalents 20 30 40
Total 220 264 275

UNIT 9
RATIO ANALYSIS
STD: XII
ILLUSTRATIONS:
1. Calculate current ratio from the following information:

Current investments 80,000 Trade creditors 1,60,000
Inventories 1,60,000 Bills payable 1,00,000
Trade receivables 4,00,000 Expenses payable 1,40,000
Cash and cash equivalents 1,20,000 Prepaid expenses 40,000
2. Calculate quick ratio of Ananth Constructions Ltd from the information given
below.
Total current liabilities 1,00,000

Total current assets 2,50,000
Inventories 50,000
Prepaid expenses 15,000
3. Following is the balance sheet of Magesh Ltd. as on 31st March, 2019:
Particulars Amount
Equity Share capital 2,00,000
Long-term borrowings 50,000
(a) Short-term borrowings 17,000
(b) Trade payables 25,000
(c) Other current liabilities

Expenses payable 3,000

www.nammakalvi.in

(d) Short-term provisions 5,000
Total 3,00,000
II ASSETS
Fixed assets
(a) Tangible assets 1,50,000
2. Current assets
(a) Inventories 45,000
(b) Trade receivables 70,000
(c) Cash and cash equivalents 30,000
(d) Other current assets

Total 3,00,000
Calculate: (i) Current ratio (ii) Quick ratio
4. From the following information, calculate debt equity ratio:
Balance sheet (Extract) as on 31.03.2018

Particulars Amount
(a) Share capital
Equity share capital 1,00,000
(b) Reserves and surplus 60,000

Long-term borrowings (Debentures) 80,000
(a) Trade payables 50,000
(b) Other current liabilities
Outstanding expenses 30,000
Total 3,20,000
5. From the following Balance Sheet of Pioneer Ltd. calculate proprietary ratio:
Balance sheet of Pioneer Ltd. as on 31.3.2019

Particulars Amount
(a) Share capital
(i) Equity Share capital 1,00,000
(ii) Preference share capital 75,000
Long-term borrowings -
Trade payables 2,00,000
Total 4,00,000
II ASSETS

(a) Fixed assets 2,75,000
(b) Non-current investments 50,000
2. Current assets
Cash and Cash equivalents 75,000
Total 4,00,000
6. From the following information calculate capital gearing ratio:
Balance Sheet (Extract) as on 31.03.2018

Particulars Amount
(a) Share capital
6% Preference share capital 1,00,000
(b) Reserves and surplus 1,25,000
General reserve
Surplus 75,000
Long-term borrowings (8% 2,00,000

Debentures)
3. Current liabilities 1,50,000
Trade payables
Provision for tax 50,000

Total 9,00,000
7. From the following Balance Sheet of Arunan Ltd. as on 31.03.2019 calculate

(i) Debt-equity ratio (ii) Proprietary ratio and (iii) Capital gearing ratio.
Balance Sheet of Arunan Ltd. as on 31.03.2019
Particulars Amount
(a) Share capital

Debentures)
3. Current liabilities 25,000
Short-term borrowings from banks
Trade payables 75,000
Total 10,00,000
II ASSETS
Fixed assets 7,50,000
2. Current assets
(a) Inventories 1,20,000
(b) Trade receivables 1,00,000

Expenses paid in advance 2,500
Total 10,00,000
8 . From the given information calculate the inventory turnover ratio and inventory
conversion period (in months) of Sania Ltd.
Inventory at the beginning of the year 40,000
Inventory at the end of the year 20,000
Purchases made during the year 90,000
9. The credit revenue from operations of Harini Ltd. amounted to 9,60,000. Its
debtors and bills receivable at the end of the accounting period amounted to
1,00,000 and 60,000 respectively. Calculate trade receivable turnover ratio and
also collection period in months.
10. From the following figures obtained from Kalpana Ltd, calculate the trade
payables turnover ratio and credit payment period (in days).
Credit purchases during 2018 – 2019 1,00,000
Trade creditors as on 1.4.2018 20,000
Bills payable as on 1.4.2018 4,000
11. From the following information of Ashika Ltd., calculate fixed assets turnover
ratio:
(i) Revenue from operations during the year were 60,00,000.
(ii) Fixed assets at the end of the year was 6,00,000.
12. Calculate (i) Inventory turnover ratio (ii) Trade receivable turnover ratio (iii)
Trade payable turnover ratio and (iv) Fixed assets turnover ratio from the
following information obtained from Delphi Ltd.
Particulars As on As on
31st March, 2018 31st March, 2019
Inventory 1,40,000 1,00,000
Trade receivables 80,000 60,000

Fixed assets 5,50,000 5,00,000
(i) Revenue from operations for the year 10,50,000

(ii) Purchases for the year 4,50,000
(iii) Cost of revenue from operations 6,00,000.
Assume that sales and purchases are for credit.
13. Calculate gross profit ratio from the following:

Revenue from operations 1,00,000, Cost of revenue from operations 80,000
and purchases 62,500.
14. Following is the statement of profit and loss of Maria Ltd. for the year ended
31st March, 2018. Calculate the operating cost ratio.
Statement of Profit and Loss
Particulars Note No. Amount
I. Revenue from operations 8,00,000
II. Other Income 20,000
III. Total revenue (I +II) 8,20,000
IV. Expenses:
Purchases of stock-in-trade 4,50,000
Changes in inventories - 40,000
Employee benefits expenses 1 22,000
Other expenses 2 68,000
Total expenses 5,00,000
V. Profit before tax (III-IV) 3,20,000

www.nammakalvi.in

Notes to Accounts
Particulars Amount
1. Employee benefits expenses
Wages (direct) 10,000
Salaries 2,000
Total 12,000
2. Other expenses
Administrative expenses 20,000
Selling and distribution expenses 28,000
Loss on sale of fixed asset 20,000
Totals 68,000
15. Calculate operating profit ratio under the following cases.

Case 1: Revenue from operations ` 10,00,000, Operating profit ` 1,50,000.
Case 2: Revenue from operations ` 15,00,000, Operating cost ` 12,00,000.
Case 3: Revenue from operations ` 20,00,000,
Gross profit 30% on revenue from operations, Operating expenses 4,00,000.
16. From the following details of a business concern calculate net profit ratio.
Cost of revenue from operations 1,50,000
Administration expenses 50,000
Selling expenses 10,000

17. From the following statement of profit and loss of Mukesh Ltd. calculate
(i) Gross profit ratio (ii) Net profit ratio.
Statement of Profit and loss
Particulars Amount
Income from investment
IV. Expenses:
Changes in inventories 20,000
Employee benefits expenses 30,000
Other expenses 1,10,000
V. Profit for the year 1,50,000

18. From the following trading activities of Naveen Ltd. calculate
(i) Gross profit ratio (ii) Net profit ratio (iii) Operating cost ratio (iv) Operating profit
ratio.
Particulars Amount
I. Revenue from operations 20,000
II. Other Income 200
III. Total revenue (I +II) 20,200
IV. Expenses:
Purchases of stock-in-trade 17,000
Changes in inventories - 1000
Finance costs 300
Other expenses (administration and 2,400

selling)
Total expenses 18,700

V. Profit before tax (III - IV) 1,500
19. Following is the extract of the balance sheet of Babu Ltd., as on 31st March,
2018:
Particulars Amount
(a) Share capital 70,000
(b) Other current liabilities 15,000
(c) Short-term provisions 42,000
Total 2,02,000
Net profit before interest and tax for the year was ` 25,000. Calculate the return
on capital employed for the year.

EXERCISE PROBLEMS
1. Calculate the current ratio from the following information.
Current investments 40,000 Fixed assets 5,00,000

Inventories 2,00,000 Trade creditors 80,000
Trade debtors 1,20,000 Bills payable 50,000
Bills receivable 80,000 Expenses payable 20,000
Cash and cash equivalents10,000 Non-current liability 3,00,000
2. Calculate quick ratio: Total current liabilities 2,40,000; Total current assets
4,50,000; Inventories 70,000; Prepaid expenses 20,000.
3. Following is the balance sheet of Lakshmi Ltd. as on 31st March, 2019:
Particulars Amount
Long-term borrowings 2,00,000
(a) Short-term borrowings 50,000
(b) Trade payables 3,10,000
(c) Other current liabilities

Expenses payable 15,000
(d) Short-term provisions 25,000
Total 10,00,000
II ASSETS
Fixed assets
(a) Tangible assets 4,00,000
2. Current assets
(b) Trade debtors 3,20,000
Total 10,00,000
Calculate:
(i) Current ratio (ii) Quick ratio
4. From the following information calculate debt equity ratio.
Balance Sheet (Extract) as on 31st March, 2019

Particulars Amount
(a) Share capital
Equity share capital 6,00,000

Long-term borrowings (Debentures) 6,00,000
(a) Trade payables 1,60,000
(b) Other current liabilities
Outstanding expenses 40,000
Total 16,00,000
5. From the following Balance Sheet of Sundaram Ltd. calculate proprietary ratio:
Balance sheet of Sundaram Ltd. as on 31.3.2019
Particulars Amount
(a) Share capital
(i) Equity Share capital 2,50,000
(ii) Preference share capital 1,50,000
Long-term borrowings -
Total 6,00,000
II ASSETS
(a) Fixed assets 4,60,000
(b) Non-current investments 1,00,000
2. Current assets

www.nammakalvi.in

Cash and Cash equivalents 40,000
Total 6,00,000
6. From the following information calculate capital gearing ratio:

Balance Sheet (Extract) as on 31.03.2018
Particulars Amount
(a) Share capital
General reserve
Surplus 1,50,000

Debentures)
Trade payables

Total 13,50,000
7. From the following Balance Sheet of James Ltd. as on 31.03.2019 calculate

(i) Debt-equity ratio (ii) Proprietary ratio (iii) Capital gearing ratio
Balance Sheet of James Ltd. as on 31.03.2019
Particulars Amount
(a) Share capital
Debentures)

Short-term borrowings from banks
Total 12,00,000
II ASSETS
Fixed assets 8,00,000

2. Current assets

(b) Trade receivables 2,65,000

Expenses paid in advance 5,000
Total 12,00,000
8. From the given information calculate the inventory turnover ratio and inventory
conversion period (in months) of Devi Ltd.

Inventory at the beginning of the year 1,70,000
Inventory at the end of the year 1,30,000
Purchases made during the year 6,90,000
9. The credit revenue from operations of Velavan Ltd, amounted to 10,00,000. Its
debtors and bills receivables at the end of the accounting period amounted to
1,10,000 and 1,40,000 respectively. Calculate trade receivables turnover ratio
and also collection period in months.
10. From the following figures obtained from Arjun Ltd, calculate the trade
payables turnover ratio and credit payment period (in days).
Credit purchases during 2018 – 2019 9,50,000

11. From the following information of Geetha Ltd., calculate fixed assets turnover
ratio
(i) Revenue from operations during the year were 55,00,000.
(ii) Fixed assets at the end of the year 5,00,000.
12. Calculate (i) Inventory turnover ratio (ii) Trade receivables turnover ratio (iii)
Trade payables turnover ratio and (iv) Fixed assets turnover ratio from the
following information obtained from Aruna Ltd.
Particulars As on As on
31st March, 2018 31st March, 2019
Inventory 3,60,000 4,40,000

Trade receivables 7,40,000 6, 60,000

Trade payables 1,90,000 2,30,000
Fixed assets 6,00,000 8,00,000
(i) Revenue from operations for the year 35,00,000
(ii) Purchases for the year 21,00,000
(iii) Cost of revenue from operations 16,00,000.
Assume that sales and purchases are for credit.
13. Calculate gross profit ratio from the following:

Revenue from operations 2,50,000, Cost of revenue from operations 2,10,000
and Purchases 1,80,000.
14. Following is the statement of profit and loss of Padma Ltd. for the year ended
31st March, 2018. Calculate the operating cost ratio.
Particulars Note No. Amount
IV. Expenses:
Employee benefits expenses 1 1,60,000
Other expenses 2 1,70,000

V. Profit before tax (III-IV) 3,10,000
Notes to Accounts
Particulars Amount
1. Other expenses
Office and administrative expenses 50,000
Loss on sale of furniture 30,000
Totals 1,70,000
15. Calculate operating profit ratio under the following cases.

Case 1: Revenue from operations 8,00,000, Operating profit 2,00,000.
Case 2: Revenue from operations 20,00,000, Operating cost 14,00,000.
Case 3: Revenue from operations 10,00,000, Gross profit 25% on revenue from
operations,Operating expenses 1,00,000
16. From the following details of a business concern calculate net profit ratio.
Cost of revenue from operations 5,50,000
Office and administration expenses 1,45,000
17. From the following statement of profit and loss of Dericston Ltd. calculate
Gross profit ratio (ii) Net profit ratio.
Particulars Amount

IV. Expenses:
Changes in inventories - 80,000
Employee benefits expenses 2,90,000
Other expenses 1,10,000
V. Profit for the year 2,40,000
18. From the following trading activities of Jones Ltd. calculate

(i) Gross profit ratio (ii) Net profit ratio (iii) Operating cost ratio (iv) Operating profit
ratio
Particulars Amount
IV. Expenses:
Finance costs 24,000
Other expenses (administration and 60,000
selling)


V. Profit before tax (III - IV) 80,000
19. Following is the extract of balance sheet of Abdul Ltd., as on 31st March,
2019:
Particulars Amount
(a) Share capital 70,000
(b) Other current liabilities 15,000
(c) Short-term provisions 42,000
Total 2,02,000

www.nammakalvi.in

1. PRINCIPLES OF MANAGEMENT
I. Choose the Correct Answers:

1. Management is what a _______ does?
a) Manager b) Subordinate c) Supervisor d) Superior
2. Management is an ________
a) Art b) Science c) Art and Science d) Art or Science
3. Scientific management is developed by
a) Fayol b) Taylor c) Mayo d) Jacob
4. Dividing the work into small tasks is known as
a) Discipline b) Unity c) Division of work d) Equity
5. With a wider span, there will be _______ hierarchical levels.
a) More b) Less c) Multiple d) Additional
II. Very short answer questions:
1. What is Management?
2. List out the management tools.
3. Who is a manager?
4. State the meaning of Authority.
5. What do you mean by Span of management?
III. Short answer questions:

1. Define the term management.
2. Is management an Art or Science?
3. Differentiate management from Administration.
4. What are the principles of Taylor?

5. What determines the span of management?
IV. Long answer questions:

1. Write about the contribution of Drucker to management.
2. Explain the management process in detail.
3. Describe the principles of scientific management.
4. Explain the principles of modern management.
5 . Discuss the implications of span of management.
2. FUNCTIONS OF MANAGEMENT
1. Which is the primary function of management?
(a) Innovating (b) Controlling (c) Planning (d) Decision-making
2. Which of the following is not a main function?
(a) Decision-making (b) Planning (c) Organising (d) Staffing
3. Distribution of work in groupwise or sectionwise is called as _________
(a) Co-ordinating (b) Controlling (c) Staffing (d) Organising
4. Which of the following is verification function?
(a) Planning (b) Organising (c) Staffing (d) Controlling
II. Very Short Answer Questions:

1. Write a short note about Planning.
2. What is meant by Motivation?
3. What is meant by Controlling?
4. How do you coordinate your classroom with peace?
5. What is meant by Innovation?
III. Short Answer Questions:

1. List out the main functions of management?
2. State the importance of staffing.

3. Bring out the subsidiary functions of management.
4. State the importance of Motivation.
5. What are the main duties of a manager?
IV. Long Answer Questions:

1. Explain the various functions of management.
3. MANAGEMENT BY OBJECTIVES AND MANAGEMENT BY

EXCEPTION
1. ________ System gives full Scope to the Individual Strength and Responsibility.
(a) MBO (b) MBE (c) MBM (d) MBA
2. Which is the First step in Process of MBO?.
(a) Fixing Key Result Area (b) Appraisal of Activities
(c) Matching Resources with Activities (d) Defining Organisational Objectives
3. __ keep Management Alert Opportunities &Threats Identifying Critical Problems.
(a) MBA (b) MBE (c) MBM (d) MBO
4. Delegation of Authority is Easily Done with the Help of __________ .
(a) MBM (b) MBE (c) MBO (d) MBA
1. Define - MBO
2. What are the objectives of MBO?
3. Bring out the meaning of MBE.
4. Mention any two advantages of MBO?
5. Wrtie any two importance of MBE.
6. What is known as KRA?


1. Write the features of MBO.
2. What are the process involved in MBO?
3. What are the Process of MBE?
4. List out any Four process of MBO.
1. What are the major advantages of MBO?
2. What are the advantages of MBE?
3. Explain the various disadvantages of MBO.
4. Discuss the disadvantages of MBE.
4. INTRODUCTION TO FINANCIAL MARKETS

1. Financial market facilitates business firms........................
a) To rise funds b) To recruit workers c) To make more sales d) To minimize fund
requirement
2. Capital market is a market for................................
a) Short Term Finance b) Medium Term Finance c) Long Term Finance
d) Both Short Term and Medium Term Finance
3. Primary market is also called as...........................
a) Secondary market b) Money market c) New Issue Market d) Indirect Market
4. SpotMarket is market delivery financial instrument & payment cash occurs.........
a) Immediately b) In the future c) Uncertain d) After one month
5. How many times a security can be sold in a secondary market?
a) Only one time b) Two time c) Three times d) Multiple times

1. What are the components of organized sectors?
2. Write a note on financial market.
3. What is equity market?
4. What is debt market?

5. How is price decided in a secondary market?
1. Give the meaning and definition of financial market.
2. Differentiate spot market from future market.
3. Write a note on Secondary Market.
4. Bring out the scope of financial market in india.
1. Distinguish between new issue market and secondary market.
2. Enumerate the different kinds of financial markets.
3. Discuss the role of financial market.
4. What are the functions of Financial Markets?
5. Discuss the various types of Financial markets.
5. CAPITAL MARKET
1. Capital market do not provide...........................
a) Short term Funds b) Debenture Funds c) Equity Funds d) Long term Funds
2. When the NSEI was established....................
a) 1990 b) 1992 c) 1998 d) 1997
3. Primary market is a Market where securities are traded in the..................
a) First Time b) Second Time c) Three Time d) Several Times
4. Participants in the capital market includes.........................
a) Individuals b) Corporate c) Financial Institutions d) All of the above
5. How many times a security can be sold in a secondary market?
a) Only One Time b) Two Time c) Three Times d) Multiple Times
1. What is Capital Market?
2. Write a note on OTCEI.

3. What is Mutual Fund?

4. Who are the participants in a Capital Market?
5. How is price determined in a Capital Market?

1. What are the various kinds of Capital Market? Explain.
2. Explain any two functions of Capital Market.
3. Write a note on National Clearance and Depository System (NCDS).
4. Discuss about evolution and growth of Indian Capital Market.
5. Explain about Factoring and Venture Capital Institutions.
1. Discuss the characters of a Capital Market.
2. Briefly explain the functions of capital market.
3. Explain the various types of New Financial Institutions.
6. MONEY MARKET
1. The money invested in the call money market provides high liquidity with
_________________.
a) Low Profitability b) High Profitability c) Limited Profitability
d) Medium Profitability
2. A major player in the money market is the _________________.
a) Commercial Bank b) Reserve Bank of India
c) State Bank of India d) Central Bank.
3. Money Market provides_______________.
a) Medium-term Funds b) Short-term Funds c) Long-term Funds d) Shares
4. Money Market Institutions are __________.
a) Investment Houses b) Mortgage Banks
c) Reserve Bank of India d) Commercial Banks and Discount Houses.
5. Risk in the Money Market is __________.

a) High b) Market Risk
c) Low Credit and Market Risk d) Medium Risk
6. Debt Instruments are issued by Corporate Houses are raising short-term financial
resources from the money market are called __________.
a) Treasury Bills b) Commercial Paper
c) Certificate of Deposit d) Government Securities
7. The market for buying and selling of Commercial Bills of Exchange is known as a ___.
a) Commercial Paper Market b) Treasury Bill Market
c) Commercial Bill Market d) Capital Market
8. A marketable document of title to a time deposit for a specified period may be referred
to as a _____.
a) Treasury Bill b) Certificate of Deposit
c) Commercial Bill d)Government. Securities
9. Treasury Bills commands ___________.
a) High Liquidity b) Low Liquidity c) Medium Liquidity d) Limited Liquidity
10. Government Securities are issued by agencies such as __________
a) Central Government b) State Governments
c) Semi-government Authorities d) All of the above

1. Define the term “Money Market”.
2. What is commercial bill market?
3. What is a CD market?
4. What is Government Securities Market?
5. What are the Instruments of Money Market?
6. Explain the two oldest money markets.
7. What do you meant by Auctioning?
8. What do you meant by Switching?

www.nammakalvi.in


1. What are the features of Treasury Bills?
2. Who are the participants of Money Market?
3. Explain the types of Treasury Bills?
4. What are the features of Certificate of Deposit?
5. What are the types of Commercial Bill?
1. Define Money Market and Capital Market. Explain the difference between the Money
Market and Capital Market.
2. Explain the characteristics of Money Market?
3. Explain the Instruments of Money Market?
4. Explain the features and types of Commercial Bills?
5. What are the features of Government Securities?
7. STOCK EXCHANGE

1. ____ is the oldest stock exchange in the world.
a) London Stock Exchange b) Bombay Stock Exchange
c) National Stock Exchange d) Amsterdam Stock Exchange
2. There are _____ stock exchange in the country.
a) 21 b) 24 c) 20 d) 25
3. Stock exchanges deal in...............................
a) Goods b) Services c) Financial Securities d) Country’s Currency

4. Stock exchange allow trading in.................................

a) All types of Shares of any Company b) Bonds issued by the Govt
c) Listed Securities d) Unlisted Securities
5. Jobbers transact in a stock exchange
a) For their Clients b) For their Own Transactions
c) For other Brokers d) For other Members
6. A pessimistic speculator is
a) Stag b) Bear c) Bull d) Lame Duck
7. An optimistic speculator is
a) Bull b) Bear c) Stag d) Lame duck
8. A bull operator believes in
a) Increase in Prices b) Decrease in Prices
c) Stability in Prices d) No change in Prices
9. ______ means the price at which securities are bought and sold are recorded and made
public.
a) Market Quotations b) Trade Quotations
c) Business Quotations d) Buyers Quotations
10. The rules and regulations of Stock exchange is framed by ________ guide lines.
a) RBI b) Central Government c) SEBI d) BSE

1. What is meant Stock Exchange?
2. Define Stock Exchange.
3. Write any 5 Stock Exchanges in India.
4. What is meant by Remisier?
5. Who is called a Broker?
6. What are the types of Speculator?
7. What is meant by Commodity Exchange?

8. Mention the Recent Development in Stock Exchange?
9. What is the stock trading time in India?
10. Explain Dalal Street.

1. What are the limitations of Stock exchange?
2. Explain Bull and Bear.
3. Explain Stag and Lame Duck.
4. Explain National Stock Market System. (NSMS)
5. Explain National Stock Exchange. (NSE)

1. Explain the functions of Stock Exchange. (Any 5)
2. Explain the features of Stock Exchange. (Any 5)
3. Explain the Benefits of Stock Exchange.
4. Distinguish between Stock Exchange and Commodity Exchange.
5. Explain Lombard street and Wall street.
8. SECURITIES EXCHANGE BOARD OF INDIA (SEBI)

1. Securities Exchange Board of India was first established in the year ____
a) 1988 b) 1992 c) 1995 d) 1998
2. The headquarters of SEBI is _______
a) Calcutta b) Bombay c) Chennai d) Delhi
3. In which year SEBI was constituted as the regulator of capital markets in India?

a) 1988 b) 1992 c) 2014 d) 2013

4. Registering and controlling the functioning of collective investment schemes as _____
a) Mutual Funds b) Listing c) Rematerialisation d) Dematerialization
5. SEBI is empowered by the Finance ministry to nominate ______ members on the
Governing body of every stock exchange.
a) 5 b) 3 c) 6 d) 7
6. The process of converting physical shares into electronic form is called ________
a) Dematerialisation b) Delisting c) Materialisation d) Debarring
7. Trading is dematerialized shares commenced on the NSE is ________
a) January 1996 b) June 1998 c) December 1996 d) December 1998
8. ________ was the first company to trade its shares in Demat form.
a) Tata Industries b) Reliance Industries c) Infosys d) Birla Industries
9. _____ enables small investors to participate in the investment on share capital of large
companies.
a) Mutual Funds b) Shares c) Debentures d) Fixed deposits
10. PAN stands for _____
a) Permanent Amount Number b) Primary Account Number
c) Permanent Account Number d) Permanent Account Nominee
1. Write a short notes on SEBI.
2. Write any two objectives of SEBI.
3. What is Demat account?

4. Mention the headquarters of SEBI.
5. What are the various ID proofs?
1. What is meant by Dematerialization?
2. What are the documents required for a Demat account?
3. What is the power of SEBI under Securities Contract Act?
4. What is meant by Insiders trading?
5. Draw the organization structure of SEBI.
1. What are the functions of SEBI?
2. Explain the powers of SEBI.
3. What are the benefits of Dematerialisation?
9. HUMAN RESOURCE MANAGEMENT

1. Human resource is a -------- asset.
a) Tangible b) Intangible c) Fixed d) Current
2. Human Resource management is both ------- ----- and -----------.
a) Science and art b) Theory and practice
c) History and Geography d) None of the above
3. Planning is a -------------- function.
a) selective b) pervasive c) both a and b d) none of the above
4. Human resource management determines the --------------------- relationship.

a) internal, external b) employer, employee

c) Owner, Servant d) Principle, Agent
5. Labour turnover is the rate at which employees ---------- the organisation
a) enter b) leave c) Salary d) None of the above

1. Give the meaning of Human Resource.
2. What is Human Resource Management ?
3. State two features of HRM.
4. Mention two characteristics of Human Resource.
5. List the functions of HRM.

1. Define the term Human Resource Management.
2. What are the features of Human resources ?
3. Give two points of differences between HR and HRM.
4. What is the importance of Human resource?
5. State the functions of Human Resource Management.

1. Explain the unique features of Human Resource.
2. Describe the significance of Human Resource Management.
3. Elaborate on the Managerial functions of Human Resource Management.
4. Differentiate HR from HRM.
5. Discuss the Operating functions HRM.
10. RECRUITMENT METHODS

1. Recruitment is the process of identifying --- ------------.
a) right man for right job b) good performer c) Right job d) All of the above
2. Recruitment bridges gap between ------------ --- and -------------- .
a) job seeker and job provider b) job seeker and agent
c) job provider and owner d) owner and servant
3. Advertisement is a --------------- source of recruitment
a) internal b) external c) agent d) outsourcing
4. Transfer is an --------------- source of recruitment.
a) internal b) external c) outsourcing d) None of the above

5. e recruitment is possible only through -------------- facility.
a) Computer b) internet c) Broadband d) 4G

1. Give the meaning of Recruitment.
2. What is promotion ?
3. State two benefits of internal source of recruitment.
4. Mention any two features of campus recruitment.
5. List the benefits of external source of recruitment.

1. Define the term Recruitment.
2. What are the features of internal source of recruitment?
3. Give two points of differences between advertisement and unsolicited application.
4. What is the importance of job portals?
5. State the steps in Recruitment process.

1. Explain the different methods of recruitment.
2. Describe the significance of External source of recruitment.
3. Elaborate on the factors affecting recruitment.
4. Differentiate Recruitment and Selection.
5. Discuss the importance of Recruitment.
11. EMPLOYEE SELECTION PROCESS

1. The recruitment and Selection Process aimed at right kind of people.......
a) At right people b) At right time
c) To do right things d) All of the above
2. The poor quality of selection will mean extra cost on ----------------- and supervision
a) Training b)Recruitment
c) work quality d) None of these

3. -------------- refers to the process of identifying and attracting job seekers so as to build
a pool of qualified job applicants.
a) Selection b) Training c) Recruitment d) Induction
4. Selection is usually considered as a----------------- process

a) Positive b) Negative c) Natural d) None of these
5. Which of the following test is used to measure the various characteristics of the
candidate?
a) physical Test b) Psychological Test
c) attitude Test d) Proficiency tests
6. Which of the following orders is followed in a typical selection process....
a) application form test and or interview, reference check and physical examination
b) Application form test and or interview, reference check, and physical examination
c) Reference check, application form, test and interview and physical examination
d) physical examination test and on interview application term and reference check.
7. The purpose of an application blank is to gather information about the ............

a) Company b) Candidate
c) Questionnaire or Interview Schedule d) Competitors
8. Identify the test that acts as an instrument to discover the inherent ability of a
candidate.........
a) Aptitude Test b) Attitude Test
c) Proficiency Test d) Physical Test
9. The process of eliminating unsuitable candidate is called ........................
a) Selection b) Recruitment c) Interview d) Induction
10. Scrutiny of application process is the.....................
a) Last step in Selection process b) First step in Selection process
c) Third step in Selection Process d) None of the above
11. Selection process helps in....................
a) Locating candidates b) Determining the suitability of the candidates.
c) preparing employees for training d) None of these
12. The process of placing the right man on the right job is called ----------
a) Training b) Placement c) Promotion d) Transfer
13. Probation/Trial period signifies....................
www.nammakalvi.in

a) one year to two years . b) one year to three years

c) Two years to four years d) None of the above
14. Job first man next is one of the principles of -----------
a) Test b) Interview c) Training d) placement

1. What is selection?
2. What is an interview?
3. What is intelligence test?
4. What do you mean by test?
5. What do you understand about bio data?
6. What do you mean by placement?
1. What is stress interview?
2. What is structured interview?
3. Name the types of selection test?
4. What do you mean by achievement test?
5. Why do you think the medical examinations of a candidate is necessary?
6. What is aptitude test?
7. How is panel interview conducted?
8. List out the various selection interviews.
9. List out the significance of placement.
IV. Long answer questions:
1. Briefly explain the various types of tests.
2. Explain the important methods of interview.
3. Explain the principles of placement.
12. EMPLOYEE TRAINING METHOD
1. Off the Job training is given-----------------
a) In the class room b) On off days
c) Outside the factory d) In the playground

2. Vestibule training is provided--------------------------------
a) On the job b) In the class room
c) In a situation similar to actual working environment d) By the committee
3. Improves Skill Levels of employees to ensure better job performance---------
a) Training b) Selection
c) Recruitment d) Performance appraisal
4. When trainees are trained by supervisor or by superior at the job is called------
a) Vestibule training b) Refresher training
c) Role play d) Apprenticeship training
5. ------------- is useful to prevent skill obsolescence of employees
a) Training b) Job analysis
c) Selection d) Recruitment
6. Training methods can be classified into training ------------training
a) Job rotation and Job enrichment b) On the Job and Off the Job
c) Job analysis and Job design d) Physical and mental
7. Case study method is --------------- type of trainee.
a) Only theoritical training b) Both theory and practical training
c) Hands on training d) Abservation Training
8. Elaborate discussion on specific topic comes under --------------- method of training.
a) Under study b) Coaching c) Conferences d) Counseling
1. What is meant by training?
2. What is Mentoring training method?

3. What is Role play?
4. State e-learning method?
1. What is vestibule training?
2. What do you mean by on the job Training?
3. Write down various steps in a training programme.
4. Write short note on trainer and trainee.
1. Define training. Discuss various types of training.
2. What are the difference between on the job training and off the job training?
3. Explain the benifits of training.
13. CONCEPT OF MARKET AND MARKETER

1. One who promotes (or) Exchange of goods or services for money is called as----- .
a) Seller b) Marketer c) Customer d) Manager
2. The marketer initially wants to know in the marketing is .---------------
a) Qualification of the customer b) Quality of the product
c) Background of the customers d) Needs of the customers
3. The Spot market is classified on the basis of -----------------------.
a) Commodity b) Transaction c) Regulation d) Time
4. Which one of the market deals in the purchase and sale of shares and debentures?
a) Stock Exchange Market b) Manufactured Goods Market
c) Local Market d) Family Market
5. Stock Exchange Market is also called ...........................
a) Spot Market b) Local Market

c) Security Market d)National Market

1. What is Market?
2. Define Marketer.
3. What is mean by Regulated Market?
4. Mention any four differences between Wholesale Market and Retail market?
5. What is meant by Commodity Market?
II. Short Answer Questions:
1. What can be marketed in the Market?
2. Mention any three Role of Marketer?
3. Marketer is an innovator? Do you agree?
4. Why Customer support is needed to Market?
5. Explain the types of market on the basis of time.
6. List down the functions of Marketer?
III. Long Answer Questions:
1. How the market can be classified?
2. How the market can be classified on the basis of Economics?
3. What is your contribution to promote the market in the modern society?
14. MARKETING AND MARKETING MIX

1. The initial stage of Marketing system is…………………….
a) Monopoly system b) Exchange to Money
c) Barter system d) Self producing
2. Who is supreme in the Market?
a) Customer b) Seller c) Wholesaler d) Retailer
3. In the following variables which one is not the variable of marketing mix?
a) Place Variable b) Product Variable
c) Program Variable d) Price Variable
4. Marketing mix means a marketing program that is offered by a firm to its
target……………………. to earn profits through satisfaction of their wants.
a) Wholesaler b) Retailer c) Consumer d) Seller

5. Which one is the example of Intangible product?

a) Education b) Mobiles c) Garments d) Vehicles

1. Define Marketing Mix.
2. Give any two internal factors affecting the price of product / service.
3. Define Product.
1. What are the objectives of marketing?
2. What is need for market and explain the concept of marketing?
3. What are the factors affecting Price of Product?
4. What do you mean by marketing mix? Describe any two elements.
1. Discuss about the Evolution of marketing.
2. Why the marketing is important to the society and individual firm? Explain.
3. Narrate the Elements of Marketing mix.
4. What is Marketing?
5. State to advantages of warehousing.
6. How market information is helpful to invention of new product in the market?
15. RECENT TRENDS IN MARKETING
1. Selling goods/ services through internet is------------------------
a. Green marketing b. E- business c. Social marketing d. Meta marketing
2. Which is gateway to internet?
a. Portal b. CPU c. Modem d.Webnaire
3. Which one represents a cluster of manufacturers, content providers and online retailers
organised around an activity?

a. Virtual mall b. Association c. Metomediary d. Portal
4. Social marketing deals with----------------------
a. Society b. Social Class c. Social change d. Social evil
5. Effective use of Social media marketing increase conversion rates of ..........
a. Customer to buyers b. Retailer to customers
c. One buyer to another buyer’s d. Direct contact of marketer
6. A company’s products and prices is visually represented by..................
a. Shopping cart b.Web portal c. Electronic catalogue d. Revenue model.
7. Green Shelter concept was introduced by group----------------------
a. ACME b. Tata c. Reliance d. ICI
8.Pure play retailers are called------------------------------
a.Market creators b.Transaction brokers c.Merchants d.Agents
II.Very Short Answer Questions:
1.What is E business?
2.What is green marketing?
3.What is service marketing?
4.Define E-Marketing.
5.What is E-Tailing?
6.What is Social marketing?
III.Short Answer Questions:

1.What is B2B and B2C type of E-Commerce?
2.Explain the importance of social marketing.
3.Discuss the objectives E-Marketing
4.Elucidate how E-Commerce differs fromE-Business.
5.Explain in detail about Niche marketing.
IV.Long Answer Questions:
1.Explain in detail how traditional marketingdiffer from E-marketing
2.Explain advantages and disadvantages ofE-tailing.
3.Describe the various strategies pursued inrecent day’s marketers.
4.Compare the concept of social marketingwith service marketing.
5.Disscuss any two new methods of marketingwith it's advantages.
16. CONSUMERISM
1. The term ‘consumerism’ came into existence in the year ---------.
a) 1960 b) 1957 c) 1954 d) 1958
2.Who is the father of Consumer Movement?
a) Mahatma Gandhi b) Mr. Jhon F. Kennedy c) Ralph Nader d) Jawaharlal Nehru
3. Sale of Goods Act was passed in the year?
a) 1962 b) 1972 c) 1982 d) 1985
4. The main objective of all business enterprises is ------------
a) Providing service b) Providing better standard of life

c) Providing necessities to the society d)Earn profit
5. The Consumer Protection Act came into force with effect from
a) 1.1.1986 b) 1.4.1986 c) 15.4.1987 d) 15.4.1990
6. ------- of every year is declared as a Consumer Protection Day to educate the public
about their rights and responsibilities.
a) August 15 b) April 15 c) March 15 d) September 15
7. Any person who buys any goods or availsservices for personal use, for a
considerationis called as-------------------
a)Customer b)Consumer c)Buyer d)User
8.The General Assembly of United Nationspassed resolution of consumer protection

guidelines on----------------------------
a)1985 b)1958 c)1986 d)1988.

1.Who is a consumer?
2.Define Consumerism.
3.Give two examples of adulteration.
4.What is Caveat Emptor?
5.What is Caveat Venditor?
6. Write a short notes on Consumer ProtectionAct, 1986.

1. Which are the three constituent elements ofbusiness?
2. What are the important legislations relatedto consumerism in India?
3.What is meant by artificial scarcity?

www.nammakalvi.in

4.Write the importance of consumerism.

5. What is the role of Government in consumer protection?
1.How consumers are exploited?
2. Explain the role of business in consumerprotection.
3. What are the needs for consumer protection?
4. Explain the role of consumers in ConsumerProtection..
5. What are the objectives of ConsumerProtection Act, 1986?
6. Write about five important consumerlegislations.
7. What are the salient features of theConsumer Protection Act, 1986?
8. What are the objectives of United Nationsguidelines for consumer protection?
17. CONSUMER PROTECTION

1. The final aim of modern marketing is ______
a. Maximum profit b.Minimum profit
c. Consumer satisfaction d.Service to the society
2. --------- is the king of modern marketing.
a. Consumer b.Wholesaler c. Producer d. Reatailer
3. As the consumer is having the rights, they are also having -------.
a. Measures b.Promotion c. Responsibilities d.Duties
4. Which of the following is not a consumer right summed up by John F. Kennedy
a. Right to safety b.Right to choose
c. Right to consume d.Right to be informed
5. It is the responsibility of a consumer thathe must obtain----------- as a proof for the
purchase of goods.
a.Cash receipt b.Warranty card c.Invoice d.All of these

1. Write short notes on: “Right to be informed.”

2. What do you understand about “Right toSafety”?
3. What are the rights of consumer according toJohn F. Kennedy?
4. Which is the supreme objective of business?
5. What are the important aspects to be kept inmind by consumer while purchasing
goodsrelated to the quality of goods?

1. What do you understand by “Right toredressal”.
2.Define “Consumer Rights”.
3. What do you understand about” Right toprotection of health and safety”.

1.What are the rights of consumers?
2.Explain the duties of consumers.
3.What are the responsibilities of consumers?
18. GRIEVANCE REDRESSAL MECHANISM

1. The Chairman of the National ConsumerDisputes Redressal Council is ______
a) Serving or Retired Judge of the SupremeCourt of India.
b)Prime Minister
c)President of India
d)None of the above
2. The Chairman of the State ConsumerProtection Council is _____
a)Judge of a High Court b)Chief Minister
c)Finance Minister d)None of the above
3. The Chairman of the District Forum is________
a)District Judge b)High Court Judge c)Supreme Court Judge d)None of the above
4. The State Commission can entertaincomplaints where the value of the goods orservices
and the compensation, if any claimedexceed-----------------
a)2 lakhs but does not exceed `5 lakhs
b)20 lakhs but does not exceed `1 crore

c)3 lakhs but does not exceed `5 lakhs

d)4 lakhs but does not exceed `20 lakhs
5.The National Consumer Disputes Redressal Commission has jurisdiction to entertain
complaints where the value of goods/services complained against and the compensation,
if any, claimed is..................................
a)Exceeding 1 crore b)Exceeding 10 lakhs
c)Exceeding 5 lakhs d)Exceeding 12 lakhs
6. The District Forum can entertain complaintswhere the value of goods or services and
thecompensation if any claimed is less than---------------------
a)Below 10,00,000 b)Below 20,00,000
c)Below 40,00,000 d)Below 50,00,000
7. The International Organisation of Consumers Unions (IOCU)was first established in
a)1960 b)1965 c)1967 d)1987
8. Consumer awareness covers the following-------------------
a) Consumer awareness about MaximumRetail Price (MRP)
b) Consumer awareness about Fair PriceShop
c) Consumer awareness about price, quality,and expiry date of the product
d)All of the above
9.Complaints can also be filed by the---------------------
a)Central Government b)State Government
c)A group of consumers d)All of the above
10.A consumer has to be protected against
a)Defects of product b)Deficiencies of product
c)Unfair and restrictive trade practices d)All of the above
1. What do you meant by Redressal Mechanism?
2. What do you know about National Commission?
3. State the meaning of the term State Commission.
4.What is an term District Forum?
5.How to register the complaints?

1.Is Consumer Protection necessary?
2. Who are the members of the NationalCommission?
3. What is the Pecuniary Jurisdiction of theState Commission?
4. Does District Forum exceeds the claim limitof Rs 20 lakhs. Explain the condition.
5. Write a note on the Voluntary ConsumerOrganisation.
1. What are the Functions of the NationalCommission?
2. Explain the overall performance of StateCommission.
3. Explain the term District Forum and explainthe functions of District Forum.
4. What is Voluntary Consumer Organisations?Explain its Functions.
5.How to create consumer awareness?
19.ENVIRONMENTAL FACTORS
I.Choose the Correct Answers:
1. VUCA stands for ____, _____,_____,______.
a) Volatility, Uncertainity,Complexity, and Ambiguity
b) Value System, Uncertainity,Company, and Ambition
c)Vision, Uncertainity,Corporate , and Annexure
d) Volatility, Uncertainity,Consumer, and Ambiguity
2. GST stands for ______,______,______.
a) Goods and Supply Tax b) Government Sales Tax

c)Goods and Services Tax d) General Sales Tax

3. Factors within an organisation constitutes_________ environment.
a) External b) Internal
c) Micro d) Macro
4. Macro Environment of business is an_________ factor.
a) Non - economic b) Economic
c) Controllable d) Uncontrollable
5. The two major types of business environmentare _______ and ___________
a) Internal, External b) Micro, Macro
c) Supplier, Competitors d) Finacial, Public
6.________ environment includes weatherand climatic conditions.
a) Technological b) Geo - physical
c) Socio - cultural d) Global
7. The size and composition of the populationis part of _________ environment.
a) Technological b) Geo - physical
c) Socio - cultural d) Global

1 . Define Business environment
2.What is internal environment?
3.Give the meaning of corporate governance.
4.What is GST?
5.Expand VUCA.
6.What is mixed economy?
1.Explain the natural environment of business.

2.What are the political environment factors?

3 . Write about any three internal environmental factors of business.
4.State the framework of Corporate Governance in India.
5.What are the functions of the GST council?
6.Write a note on future environment ofbusiness.
7.What do you know about Technologicalenvironment?
1.Discuss the role of macro environment ofbusiness.

2.Describe the economic and socio culturalenvironment of business.
3.Explain the micro environmental factors ofbusiness.
4.Discuss the significance of understanding business environment and the internal factors
affecting business.
20.LIBERALISATION, PRIVATIZATION AND GLOBALIZATION

1. __________ is the result of New Industrial Policy which abolished the ‘License
System’.
(a) Globalisation (b) Privatisation (c) Liberalisation (d) None of these
2. _______ means permitting the private sector to setup industries which were previously
reserved for public sector.
(a) Liberalisation (b) Privatisation (c) Globalisation (d) Public Enterprise
3. ____________ ownership makes bold management decisions due to their strong
foundation in the international level.
(a) Private (b) Public (c) Corporate (d) MNC’s
4. __________ results from the removal of barriers between national economies to
encourage the flow of goods, services, capital and labour.
(a) Privatisation (b) Liberalisation (c) Globalisation (d) Foreign Trade
5. New Economic Policy was introduced in the year _______.

(a) 1980 (b) 1991 (c) 2013 (d) 2015

1. State the branches of New Economic Policy.
2. What is Privatisation?
3. Mention any three disadvantages of Liberalisation.
4. Name the industries which are reserved for public sector.
5. Give any three advantages of Globalisation.

1. What do you mean by Liberalisation?
2. Explain the concept of Privatisation.
3. What are advantages of disinvestment?
4. State any three impacts on Globalisation.
5. Write a short note on New Economic Policy.

1. Explain the advantages and disadvantages of liberalisation.
2. Explain the impact of LPG on Indian Economy.
21.THE SALE OF GOODS ACT – 1930
I.Choose the Correct Answers:
1.Sale of Goods Act was passed in the year-----------------------

a)1940 b)1997 c)1930 d)1960
2. Which of the below constitutes the essentialelement of contract of sale?
a)Two parties b)Transfer of property c)Price d)All of the above
3.Which of the below is not a good?
a)Stocks b)Dividend due c)Crops d)Water
4. In case of the sale, the ____ has the right tosell
a)Buyer b)Seller c)Hirer d)Consignee
5.The property in the goods means the
a)Possession of goods b)Custody of goods
c)Ownership of goods d)Both (a) and (b)

6. Specific goods denote goods identified upon the time of ______ of sale:
a)Agreement b)Contract c)Order d)Obligation
7. In which of the following types, theownership is immediately transferred tobuyer?
a)When goods are ascertained b)When goods are appropriate
c)Delivery to the carrier d)Sale or return basis
8.________ is a stipulation which is collateralto main purpose of contract:
a)Warranty b)Condition c)Right d)Agreement
9. Unpaid seller can exercise his right of lienover the goods, where he is in possession
ofthe goods as-------------------
a)Owner of goods b) Agent of buyer
c)Bailee for buyer d)All of these
10. The unpaid seller can exercise his right ofstoppage of goods in transit where the buyer
a)Becomes insolvent b)Refuses to pay price
c)Payment of price d)Both (b) and (c)
1.What is a contract of sale of goods?
2. List down the essential elements of acontract of sale.
3.What is meant by goods?
4.What is a Contingent Goods?
5.What do you understand by warranty?

www.nammakalvi.in

1. Explain the meaning of Agreement to sell.
2. Discuss in detail about existing goods.
3. Discuss the implied conditions and warranties in sale of goods contract.
4. Discuss in detail the rights of an unpaid seller against the buyer personally.
1. Explain in detail the elements of Contract of sale.
2. Distinguish between sale and agreement to sell
3. Classify goods under the Sale of Goods Act.
4. Distinguish between Conditions and Warranty.
5. Discuss in detail the rights of an unpaid seller against the goods.
22.THE NEGOTIABLE INSTRUMENT ACT – 1881

1. Negotiable Instrument Act was passed in the year ______.
a. 1981 b. 1881 c. 1994 d. 1818
2. Negotiable Instrument is freely transferable by delivery if it is a ________ instrument.
a. Order b. Bearer
c. Both a & b d. None of the above
3. The transferee of a Negotiable Instrument is the one ___________
a. Who transfer the instrument b. On whose name it is transferred
c. Who enchases it d. None of the above
4 . Number of parties in a bill of exchange are-----------------

a. 2 b. 6 c. 3 d. 4
5. Section 6 of Negotiable Instruments Act 1881 deals with .....................
a. Promissory Note b. Bills of exchange
c. Cheque d. None of the above
6. _______ cannot be a bearer instrument.
a. Cheque b. Promissory Note
c. Bills of exchange d. None of the above
7. When crossing restrict further negotiation ......................
a. Not negotiable crossing b. General Crossing
c. A/c payee crossing d. Special crossing
8. Which endorsement relieves the endorser from incurring liability in the event of
dishonour.........................
a. Restrictive b. Faculative c. Sans recourse d. Conditional
9. A cheque will become stale after _____ months of its date:
a. 3 b. 4 c. 5 d. 1
10. Document of title to the goods exclude.......................
a. Lorry receipt b. Railway receipt c. Airway bill d. Invoice

1. What is meant by Negotiable Instrument?
2. Define Bill of Exchange
3. List three characteristics of a Promissory Note.
4. What is meant by a cheque?
5. Define Endorsement
1. Explain the nature of a Negotiable Instrument.
2. Distinguish between Negotiability and Assignability.
3. What are the characteristics of a bill of exchange?
4. Distinguish between Bill of Exchange & Promissory Note.
5. Discuss the two different types of crossing.
1. Mention the presumptions of Negotiable Instruments.
2. Distinguish a cheque and a bill of exchange.
3. Discuss in detail the features of a cheque.
4. What are the requisites for a valid endorsement?
5. Explain the different kinds of endorsements
23. ELEMENTS OF ENTREPRENEURSHIP

1. Which of the below is a factor of production?
(a) Land (b) Labour
(c) Entrepreneurship (d) All of the above
2. Entrepreneur is not classified as.......................
(a) Risk Bearer (b) Innovator
(c) Employee (d) Organizer
3. What are the characteristics of an entrepreneur?
(a) Spirit of enterprise (b) Flexibility (c) Self Confidence (d) All of the above
4. Which of the below is not classified into managerial functions?
(a) Planning (b) Marketing (c) Organizing (d) Controlling
5. Which of the below is a commercial function?
(a) Accounting (b) Coordination (c) Discovery of idea (d) Planning
1. Mention any two features of entrepreneurs.
2. List down the managerial functions of entrepreneurs.
3. List down the promotional functions of entrepreneurs.
4. Define Intrapreneur
5. List the problems faced by the women entrepreneurs
1. Define Entrepreneur
2. Distinguish between entrepreneur and Manager.
3. List down the commercial functions of Entrepreneur and explain them shortly.
4. Explain the promotional functions of entrepreneur.
5. Explain the commercial functions of entrepreneur.
1. How do you Classify entrepreneurs.
2. What are the characteristics of an entrepreneur?
3. Distinguish between an Entrepreneur and an Intrapreneur.
4. Discuss the problems faced by Women Entrepreneurs.
5. Explain in detail the various functions of an entrepreneur

24. TYPES OF ENTREPRENEURSHIP

1. Choose the type of entrepreneur that isn’t based on function:
a. Innovative b. Classical c. Fabian d. Drone
2. Choose the type of Entrepreneur that is not based on Motivation:
a. Pure b.. Corporate c. Spontaneous d. Induced
3. Which of the following is the Activity of a Business Entrepreneur?
a. Production b. Marketing c. Operation d. All of the above
4. Find the odd one out in context of Trading Entrepreneur.
a. Selling b.. Commission c. Buying d. Manufacturing
5. Corporate Entrepreneur is also called as _____
a. Entrapreneur b. Promoter c. Manager d. Shareholder
6. Poultry, Flowers, Fruits etc are called allied Products of _______ entrepreneur.
a. Corporate b. Retail c. Trading d. Agricultural
7. ________ Entrepreneur Supply Services Unlike.
a. Hoteliers b. Banking c. Airlines d. Livestock
8. Motive of a Pure Entrepreneur is .................................
a. Rendering service b. Earning profit c. Attaining status d. Both b & c
9. Which of these is based on Technology?
a. Modern b. Professional c. Corporate d. Industrial
10. Which of the below is not a Characteristic of a Fabian Entrepreneur?
a. Conservative b. Risk averse c. Sceptical d. Adaptive

1. What is the other name of business entrepreneur?
2. Mention the other name for corporate entrepreneur.
3. Who are agricultural entrepreneur?
4. State the name of the following ventures:

a. Started by individuals for profit motive

b. Started by Government
c. Started by individuals and Government together
d. Started as a family business
5. Give some examples of pure entrepreneurs.
1. Who is a private entrepreneur?
2. What is political environment?
3. List down few examples of pure entrepreneurship
4. How does a professional entrepreneur operate?
5. Explain about the agricultural entrepreneur
1. Explain in detail on classification according to the type of business
2. Discuss the nature of functional entrepreneurs.
3. Distinguish between the rural and urban entrepreneur.
25. GOVERNMENT SCHEMES FOR ENTREPRENEURIAL

DEVELOPMENT
1. The ___________ initiative was launched to modernize the Indian economy to make
all governments services available electronically.
a) Standup India b) Startup India
c) Digital India d) Make in India
2. ________ is designed to transform India to a global design and manufacturing hub.
a) Digital India b) Make in India
c) Startup India d) Design India.
3. ___________ is the Government of India’s endeavour to promote culture of innovation

and entrepreneurship.
a) AIM b) STEP c) SEED d) AIC
4. ___________ should cover aspects like sources of finance, technical know-how,
source of labour and raw material, market potential and profitability.

a) Technical Report b) Finance Report

c) Project Report d) Progress Report
5. ____________has to include the mechanism for managing venture in the project
report.
a) Banker b) Government
c) Lending Institutions d) Entrepreneur
1. Name any four Governmental Entrepreneurial schemes.
2. Give a note on ‘Digital India’.
3. State any three entrepreneurial development schemes of Government of Tamil Nadu.
4. List down the two types of finance.
5. Mention the time period of Provision Registration Certificate.
1. What is ‘Startup India’?
2. Expand the following: STEP, JAM, TREAD, M-SIPS, SEED and New Gen IEDC
3. Write a short note on the following
a) Dairy Entrepreneurship development scheme.
b) Project report.
4. What is the procedure for getting power connection for an Entrepreneurial venture.
1. Explain any five Government Entrepreneurial schemes.
2. Describe the steps promoting Entrepreneurial venture.
3. Discuss the preparation of a project report.

26. COMPANY ACT – 2013

1. The Company will have to issue the notice of situation of Registered Office to the
Registrar of Companies within _____ days from the date of incorporation.
(a) 14 days (b) 21 days (c) 30 Days (d) 60 Days
2. How does a person who envisages the idea to form a company called?
(a) Director (b) Company Secretary (c) Registrar (d) Promoter
3. For which type of capital a company pays the prescribed fees at the time of
registration?
(a) Subscribed Capital (b) Authorised Capital
(c) Paid-up Capital (d) Issued Capital
4. Which of the following types of shares are issued by a company to raise capital from
the existing shareholders?
(a) Equity Shares (b) Rights Shares
(c) Preference Shares (d) Bonus Shares
5. Specify the type of resolution to be passed to choose the location of Registered Office
of the company within the town or village or city.
(a) Ordinary (b) Special
(c) Either Ordinary (d) Boardor Special
6. Who can issue stock?
(a) Public (b) Private (c) One Person (d) Small
7. Specify the document which comes under the Negotiable Instrument Act.
(a) Share Certificate (b) Share (c) Share Warrant (d) Stock
8. The shares which are offered to the existing shareholder at free of cost is known as
_____.
(a) Bonus Share (b) Equity Share
(c) Right Share (d) Preference Share

9. The shares which are offered first to the existing shareholder at reduced price is known
as _____________.
(a) Bonus Share (b) Equity Share
(c) Right Share (d) Preference Share
10. The Companies Act 2013 Prohibits the issue of shares at ____________________ to
the public.
(a) Premium (b) Par (c) Discount (d) Both at par and Premium

1. Who is called as Promoters?
2. What is Share?
3. What do you mean by Equity Share?
4. What do you understand by Preference Share?
5. What is Sweat Equity Shares?
6. What is Bonus Shares?
7. What is Right Shares?
8. What is Private placement?
9. Define Share Warrant.
10. What is Debentures?

1. Distinguish between shares and stocks.
2. What do you understand by Issue of Securities at Premium?
3. What is issue of shares at discount? What conditions should be fulfilled?
4. State condition stipulated for capital subscription at the time of promotion.
5. Explain different Kinds of Preference shares.

www.nammakalvi.in


1. Write the difference between Debentures and Shares:
2. Brief different stages in Formation of a Company.
3. What are the various kinds of Debentures?
4. What formalities need to be fulfilled for a companies having share capital to
commence business?
5. Write the difference between Share Certificate and Share Warrant
27. COMPANY MANAGEMENT

I. Choose the Correct Answer:
1. A person Shall hold office as a director in ________ companies as per the Companies
Act, 2013.
(a) 5 companies (b) 10 companies
(c) 20 companies (d) 15 companies
2. Which _________ Director is appointed by a Financial institution.
(a) Nominee (b) Additional
(c) Women (d) Shadow
3. A Private Company shall have a minimum of ________.
(a) Seven directors (b) Five directors
(c) Three directors (d) Two directors
4. A Public Company shall have a minimum of ________ Directors.
(a) Twelve (b) Seven (c) Three (d) Two
5. A Public Company having a paid up Share Capital of Rs. ___________ or more may
have a Director, elected by such small shareholders.
(a) One (b) Three (c) Five (d) Seven
6. Under the companies Act, which one of the following powers can be exercised by the
Board of Directors?
(a) Power to sell the company’s undertakings.
(b) Power to make call.
(c) Power to borrow money in excess of the paid up capital.
(d) Power to reappoint an auditor.

7. Which director need not hold qualifying shares.......................

(a) Directors appointed to Central Government
(b) Directors appointed to Shareholders.
(c) Directors appointed to Managing Director
(d) Directors appointed to Board of Directors
8. What is the statue of Directors who regulate money of the company.
(a) Banker (b) Holder (c) Agent (d) Trustees
9. According to Companies Act, the Directors must be appointed by the.
(a) Central Government (b) Company Law Tribunal
(c) Company in General Meeting (d) Board of Directors.
10. The Board of Directors can exercise the power to appoint directors in the case of.
(a) Additional Directors (b) Filling up the Casual vacancy
(c) Alternate Directors (d) All the above.

1. Define Director.
2. Name the companies required to appoint KMP.
3. Who is whole time Director?
4. Who is called as Managing Director?
5. Who can be Executive Director?
1. Differentiate Executive and Non-Executive Directors.
2. When are alternative directors appointed ?
3. Who is a shadow director?
4. What is causal Vacancy?
5. State the minimum number of Directors for a Private company.
1. Who are the KMP?
2. Explain composition of the board of directors.
3. Brief different types of Directors.
4. State the qualification of Directors.
5. List the disqualification of a directors.

6. Explain how director of a company can be removed from the office.
7. What is the maximum limit for the Managerial remuneration?
8. What are the duties of a directors?
9. State the powers of the directors.
10. State the Criminal liabilities of Directors.
28. COMPANY SECRETARY
1. Mention the status of a Company Secretary in a company.
a) A member b) A director
c) An independent d) An employee contractor
2. Who can become a secretary for a company?
a) Individual person b) Partnership firm
c) Co-operative societies d) Trade unions
3. Which meeting will be held only once in the life time of the company?
a) Statutory b) Annual General
c) Extra – ordinary d) Class General
4. Board Meetings to be conducted minimum __________ times in a year.
a) 2 b) 3 c) 4 d) 5
5. Who is not entitled to speak at the annual general meeting of the company.
a) Auditor b) Shareholder
c) Proxy d) Directors
6. Mention the company which need not convene the Statutory Meeting.
a) Widely held public b) Private Limited
c) Public Limited d) Guarantee having a share capital
7. From the date of its incorporation the First Annual General Meeting is to be conducted
within __________ months.
(a) Twelve (b) Fifteen (c) Eighteen (d) Twenty one
8. What percentage of shareholders is needed to pass special resolution?
a) It must be unanimous b) Not less than 90%.
c) Not less than 75%. d) More than 50%.
9. A special resolution must be filed with the Registrar within
a) 7 days b) 14 days c) 30 days d) 60 days
10. A special resolution is required to....................
a) redeem the debentures b) declare dividend
c) appoint directors d) appoint auditor


1. Who is a Secretary?
2. Define Meeting?
3. What is Resolution?
4. Write short note on ‘Proxy’?
5. What is Vote?
1. What is Special Resolution?
2. What do you mean by Statutory Meeting?
3. What do you understand by ‘Poll’?
4. Give any three cases in which an ordinary resolution need to be passed.
5. What resolution is requires special notice?
1. Elaborate the functions of the Company Secretary
2. Discuss the liabilities of Company Secretary.
3. Briefly state different types of company meetings.
4. Describe the different types of resolutions which company may pass with suitable
matters required for each type of resolution.
www.nammakalvi.in


Namma Kalvi 12th Accountancy Question Bank and Worksheet em 216264

Uploaded by

Copyright:

Available Formats

Namma Kalvi 12th Accountancy Question Bank and Worksheet em 216264

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Namma Kalvi 12th Accountancy Question Bank and Worksheet em 216264

Uploaded by

Copyright:

Available Formats

Namma Kalvi

G.K. VIDHYAA MANDHIR

ACCOUNTANCY WORKSHEETS - XII STD

 BOOK BACK ONE WORDS

 GOVERNMENT MODEL QUESTION PAPER

ACCOUNTS FROM INCOMPLETE RECORDS

CHOOSE THE CORRECT ANSWER:-

1. Incomplete records are generally maintained by…………………..

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

7. Which one of the following statements is not true in relation to incomplete

ACCOUNTS OF NOTFORPROFIT ORGANISATION

1. Receipts and payments account is a…………………….

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

3. Balance of receipts and payments account indicates the…………

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

ACCOUNTS OF PARTNERSHIP FIRMS FUNDAMENTALS

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

5. When fixed capital method is adopted by a partnership firm, which of the

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

G.K. VIDHYAA MANDIR MAT. HR. SEC. SCHOOL, KARUR. XII

6. Which of the following statements is not true in relation to admission of a

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

8. Select the odd one out…………………………….

RETIREMENT AND DEATH OF A PARTNER

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

3. On retirement of a partner, general reserve is transferred to the…………….

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

8. A, B and C are partners sharing profits in the ratio of 2:2:1. On retirement of B,

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

3. At the time of forfeiture, share capital account is debited with………..

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

(b) (iv) (iii) (ii) (i)

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

3. Which of the following tools of financial statement analysis is suitable when

9. In a common-size balance sheet, if the percentage of non-current assets is 75,

a) 175 b) 125 c) 25 d) 100

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

G.K. VIDHYAA MANDIR MAT. HR. SEC. SCHOOL, KARUR. XII

1. The mathematical expression that provides a measure of the relationship

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

G.K. VIDHYAA MANDIR MAT. HR. SEC. SCHOOL, KARUR. XII

1. What is meant by incomplete records?

3. What is a statement of affairs?

II. Short answer questions

1. What are the features of incomplete records?

2. What are the limitations of incomplete records?

5. Differentiate between statement of affairs and balance sheet.

6. How is the amount of credit sale ascertained from incomplete records?

I) Very short answer questions

1. State the meaning of not–for–profit organisation.

2. What is receipts and payments account?

B.ABDUL AJISH M.COM., B.ED., M.PHIL.,

4. Write a short note on life membership fees.

5. Give four examples for capital receipts of not–for–profit organisation.

6. Give four examples for revenue receipts of not–for–profit organisation.