CA-FOUNDATION ACCOUNTING FULL SYLLABUS PAPER BY CA CS ANSHUL AGRAWAL & CA CS DARSHAN JAIN

Paper 1
ACCOUNTING
Time allotted – 3 Hours Date – 16-06-2024 Total Marks – 100
Question No. 1 is Compulsory
Candidates are also Required to answer any Four Questions from the
Remaining Five Questions
Working Notes should form Part of Respective Answers. Wherever
necessary, Suitable Assumptions may be made and disclosed by way of a
note

1 (a)
State with Reasons, Whether the Following Statements are True or
False (6*2) = 12

i) Gauri purchased goods worth Rs 75,800 at 5% trade discount and she

paid half of the amount in cash. The amount appearing in the purchase
book is Rs 36,005.

ii) Nominal Accounts are kept under Single Entry System.

iii) Rs. 5 Crore Paid to Virat Kohli by Nike Sports Limited to act as brand
Ambassador is a Capital Expenditure (Benefit is Expected for
Approximate 5 years)

iv) Debentures Suspense Account appears on the liability Side of Balance

Sheet

v) In case of bill of exchange, the drawer and the payee may not be the
same person but in case of a promissory note, the maker and the payee
may be the same person.

vi) Earning per share gets increased after bonus issue.

b) Following items appear in the trial balance of Bharat Ltd. (a listed

company) as on 31st March, 2022:

₹
40,000 Equity shares of ₹ 10 each 4,00,000
Capital Redemption Reserve 55,000
Securities Premium (collected in cash) 30,000
General Reserve 1,05,000
Surplus i.e. credit balance of Profit and Loss Account 50,000

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 CA-FOUNDATION ACCOUNTING FULL SYLLABUS PAPER BY CA CS ANSHUL AGRAWAL & CA CS DARSHAN JAIN
The company decided to issue to equity shareholders bonus shares at
the rate of 1 share for every 4 shares held and for this purpose, it
decided that there should be the minimum reduction in free reserves.
Pass necessary journal entries. (4)

C) Explain Reserve capital & Capital Reserve (4)

2 (a) (10)

The following is the Balance Sheet of A, B, C on 31st December, 2022 when

they decided to dissolve the partnership.
Liabilities ₹ Assets ₹
Creditors 2,000 Sundry Assets 48,500
A’s Loan 5,000 Cash 500
Capital Accounts:
A 15,000
B 18,000
C 9,000

49,000 49,000

The assets realized the following sums in installments:

I 1,000
II 3,000
III 3,900
IV 6,000
V 20100
34,000
The expenses of realization were expected to be ₹ 500 but ultimately
amounted to ₹ 400 only. Show how at each stage the cash received should be
distributed between partners. They share profits in the ratio of 2:2:1.

2 (b) (10)
The profit and loss account of hanuman showed a net profit of Rs.6,00,000,
after considering the closing stock Rs.3,75,000 (Physical verification) on 31 st
March,2022. Subsequently the following information was obtained from
scrutiny of the books:

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 CA-FOUNDATION ACCOUNTING FULL SYLLABUS PAPER BY CA CS ANSHUL AGRAWAL & CA CS DARSHAN JAIN
1. Purchases for the year included Rs.15,000 paid for new electric fittings for
the shop.
2. Hanuman gave away goods valued at Rs.40,000 as free samples for which
no entry was made in the books of accounts.
3. Invoices for goods amounting to Rs.2,50,000 have been entered on 27 th
March,2022, but the goods were not included in stock.
4. In March, 2022 goods of Rs.2,00,000 sold and delivered were taken in the
sales for April,2022.
5. Goods costing Rs.75,000 were sent on sale or return in March, 2022 at a
margin of profit of 33-1/3% on cost. Though approval was given in April,
2022 these were taken as sales for March, 2022.
Calculate the value of stock on 31st March, 2022 and the adjusted net profit
for the year ended on that date.

3 (a) (10)
A, B and C are partners in a firm sharing profits and losses as 8:5:3. Their
Balance Sheet as at 31st December, 2021 was as follows:

Rs. Rs.
Sundry Creditors 1,50,000 Cash 40,000
General Reserve 80,000 Bills Receivable 50,000
Partner’s Loan Accounts: Sundry Debtors 60,000
A 40,000 Stock 1,20,000
B 30,000 Fixed Assets 2,80,000
Partner’s Capital Accounts:
A 1,00,000
B 80,000
C 70,000
5,50,000 5,50,000
From 1st January, 2022 they agreed to alter their profit-sharing ratio as
5:6:5.
It is also decided that:
a) The fixed assets should be valued at Rs.3,31,000;
b) A provision of 5% on sundry debtors be made for doubtful debts;
c) The goodwill of the firm at this date be valued at three year’s purchase of
the average net profits of the last five years before charging insurance
premium; and
d) The Stock be reduced to Rs.1,12,000.

There is a joint life insurance policy for Rs.2,00,000 for which an annual
premium of Rs.10,000 is paid, the premium being charged to Profit and Loss
Account. The surrender value of the policy on 31st December, 2021 was
Rs.78,000.

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 CA-FOUNDATION ACCOUNTING FULL SYLLABUS PAPER BY CA CS ANSHUL AGRAWAL & CA CS DARSHAN JAIN
The net profits of the firm for the last five years were Rs.14,000, Rs.17,000,
Rs.20,000, Rs.22,000 and Rs.27,000.

Goodwill and the surrender value of the joint life policy was not to appear in
the books.

Prepare Revaluation Account, Partner’s Capital Account & Revised balance

Sheet.

3 (b) (10)
On comparing the cash book of Aggarwal Ltd. With the Bank Pass Book, the
following discrepancies were noted:
1. Out of Rs 20500 paid in cash and by cheques into the bank on 27 th March,
cheque amounting to Rs 7500 were collected on 7th April.
2. Cheque and cash amounting to Rs 4800 were deposited in bank on 26 th
March but credit was given for Rs 3800 only.
3. Out of cheques amounting to Rs 7800 drawn on 26th March a cheque for
Rs 2500 was encashed on 3rd April.
4. Cheque issued to creditor amounting to Rs 20000 on 25 th March of which
cheque worth Rs 3000 were presented to bank up to 31th March.
5. A cheque for Rs 1000 entered in Cash Book but omitted to be banked on
31st March.
6. A cheque for Rs 600 deposited into bank but omitted to be recorded in
Cash Book.
7. A bill receivable for Rs 520 previously discounted (Discount Rs 20) with
the bank had been dishonoured but advice was received on 1st April.
8. A bill for Rs 10,000 was retired by the bank under a rebate of Rs 150 but
the full amount of the bill was credited in the bank column of the Cash
Book.
9. A cheque of Rs 1080 credited in the Pass Book on March 28th being
dishonoured is debited again in the Pass Book on 1 st April. There was no
entry in the Cash Book about the dishonour of the cheque until 15th April.

Prepare a Bank Reconciliation Statement at 31st March 2022 if the Balance

as per Pass Book on 31st March 2022 was Rs 50,000.

4 (a) (10)

X and Y were friends and in need of funds. On 1st Jan. X drew a bill for Rs
200000 for 3 months on Y. On 4th Jan. X got the bill discounted at 10% p.a.
and remitted half of the proceeds to Y. On 1st April, X could not send the
required sum, instead, he accepted Y’s bill for Rs 120000 for two months.
On 4th April, the bill was discounted by Y at 12% p.a. Out of this Rs 7800

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 CA-FOUNDATION ACCOUNTING FULL SYLLABUS PAPER BY CA CS ANSHUL AGRAWAL & CA CS DARSHAN JAIN
were remitted to X. At maturity of second bill, due to financial crisis, X
became insolvent and only 50 Paise in a rupee could be recovered from his
estate.

Give journal Entries in the Books of Y & Y’s ledger in the Books of X

4 (b) (5)
Mr. Shyamal runs a factory, which produces detergents. Following details
were available in respect of his manufacturing activities for the year ended
31.03.2019.

Particulars Rs.
Opening Work-in-progress (9000 units) 26,000
Closing Work-in-progress (14,000 units) 48,000
2,60,00
Opening inventory of Raw materials 0
3,20,00
Closing inventory of Raw materials 0
8,20,00
Purchases 0
Hire charges of Machinery @Rs.0.70 per unit
Manufactured
2,60,00
Hire Charges of Factory 0
Direct wages-contracted @Rs.0.80 per unit
manufactured and @0.40 per unit of closing W.I.P
1,80,00
Repairs and Maintenance 0
Units produced-5,00,000 units

Required a Manufacturing Account of Mr. Shyamal for the year ended

31.03.2019.

4(c) (i) (5)

Assets and Liabilities of Mr. X as on 31-03-2021 and 31-03-2022 are as

follows:

31-03-2021 31-03-2022
₹ ₹
Assets
Building 1,00,000 ?
Furniture 50,000 ?
Inventory 1,20,000 2,70,000

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 CA-FOUNDATION ACCOUNTING FULL SYLLABUS PAPER BY CA CS ANSHUL AGRAWAL & CA CS DARSHAN JAIN
Sundry debtors 40,000 90,000
Cash at bank 70,000 85,000
Cash in hand 1,200 3,200
Liabilities
Loans 1,00,000 80,000
Sundry creditors 40,000 70,000

Decided to depreciate building by 2.5%p.a. and furniture by 10% p.a.

One Life Insurance Policy of the Proprietor was matured during the period
and the amount ₹ 40,000 is retained in the business. Proprietor took @ ₹
2,000 p.m. for meeting family expenses.

Prepare Statement of Affairs as on 31-03-2021 and 31-03-2022 & Find

profit of Mr. X for the Year Ended 31-3-22

OR

4 (c) (ii) (5)

C Limited had 3,000, 12% Redeemable Preference Shares of ₹ 100 each,

fully paid up. The company had to redeem these shares at a premium of
10%.
It was decided by the company to issue the following:
1. 25,000 Equity Shares of ₹ 10 each at par,
2. 1,000 14% Debentures of ₹ 100 each.
The issue was fully subscribed and all amounts were received in full. The
payment was duly made. The company had sufficient profits. Show Journal
Entries in the books of the company.

5 (a) (10)
The following information was obtained from the books of Delhi Club as
on 31.03.2022, at the end of the first year of the club. You are required
to prepare Receipt and Payment Account, Income and Expenditure
Account for the year ended 31.03.2022 and Balance sheet at 31.03.2022
on mercantile basis:

1. Donations received for building and Library Room Rs.2,00,000.

2. Other revenue income and actual receipts:

Revenue Income
Actual Receipts (Rs.)
(Rs.)
Entrance Fees 17,000 17,000
Subscription 20,000 19,000
Locker Rents 600 600
Sundry Income 1,600 1,060
Refreshment Account - 16,000

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 CA-FOUNDATION ACCOUNTING FULL SYLLABUS PAPER BY CA CS ANSHUL AGRAWAL & CA CS DARSHAN JAIN
3. Other revenue expenditure and actual payments:

Revenue
Actual Payment
Expense
(Rs.)
(Rs.)
Land (Cost Rs.10,000) - 10,000
Furniture (Cost Rs.1,46,000) - 1,30,000
Salaries 5,000 4,800
Maintenance of Playgrounds 2,000 1,000
Rent 8,000 8,000
Refreshment Account - 8,000

Donation to the extent of Rs.25,000 were utilized for the purchase of

Library Books, balance was still unutilised. In order to keep it safe, 9%
Govt. Bonds of Rs.1,60,000 were purchased on 31.03.2022. Remaining
amount was put in the bank on 31.03.2022 under the term deposit.
Depreciation at 10%p.a. was to be provided for the whole year on
furniture and Library books.

5 (b)
On April 1, 2018 Shubra Ltd. Purchased a machinery for Rs.12,00,000. On
Oct 1, 2020, a part of the machinery purchased on April 1, 2018 for
Rs.80,000 was sold for Rs.45,000 and a new machinery at a cost of
Rs.1,58,000 was purchased and installed on the same date. The company
has adopted the method of providing 10% p.a. depreciation on the written
down value of the machinery.

Show Machinery A/c, Depreciation A/c, Provision for depreciation Account

and Machinery Disposal A/c for the three years ended on 31 st march 2019
to 2021 (10)

6 (a) (15)

X limited invited applications for issuing 75,000 equity shares of Rs.10 each
at a premium of Rs.5 per share. The total amount was payable as follows:

- Rs.9 per share (including premium) on application and allotment

- Balance on the first and final call

Application for 3,00,000 equity shares were received. Application for

2,00,000 equity shares were rejected and money refunded. Shares were
allotted on pro-rata basis to the remaining applicants. The first and final call
was made. The amount was duly received expect on 1,500 shares applied
by Mr. Raj. His shares were forfeited. The forfeited shares were re-issued at
a discount of Rs.4 per share.
Pass necessary journal entries for the above transactions in the books of X
limited.

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 CA-FOUNDATION ACCOUNTING FULL SYLLABUS PAPER BY CA CS ANSHUL AGRAWAL & CA CS DARSHAN JAIN
6 (b) (5)
The following errors were committed by the Accountant of Geete Dye-
Chem.
1. Credit sale of ₹ 400 to Trivedi & Co. was posted to the credit of their
account.
2. Purchase of ₹ 420 from Mantri & Co. passed through Sales Day Book as
₹ 240

How would you rectify the errors assuming that:

a) they were detected before preparation of Trial Balance.
b) they were detected after preparation of Trial Balance but before
preparing Final Accounts, the difference was taken to Suspense A/c.
c) they were detected after preparing Final Accounts.

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