(For candidates admitted from the academic year 2023 – 2024)
B. COM DEGREE EXAMINATION, NOVEMBER 2023
COMMERCE FIRST SEMESTER
COURSE : MAJOR CORE
PAPER : FINANCIAL ACCOUNTING SUBJECT CODE : 23CM /MC/FA13 TIME : 3 HOURS MAX. MARKS: 100
Q. No. SECTION A (5x2=10) CO KL
Answer all the questions 1. State the importance of Accounting Standard 2. 1 K1 2. Outline the accounting procedure for closing old book of amalgamating firms. 1 K1 3. List any four reasons for inter-department transfer of goods at selling price. 1 K1 4. Write a short note on: 1 K1 a. Goods in transit b. Cash in transit 5. State why Insurance is a contract of indemnity. 1 K1 Q. No. SECTION B (5x2=10) CO KL Answer all the questions 6. Find the provision for doubtful debts to be debited to Profit and Loss A/c: 2 K2 Opening provision for doubtful debts ₹. 2,400 Closing sundry debtors ₹. 42,000 Bad debts yet to be written off ₹ 2,000 Provide for doubtful debts at 10% on debtors 7. Compute opening branch debtors: 2 K2 Credit Sales ₹. 1,51,000 Received from debtors by the branch ₹. 1,42,500 Closing branch debtors ₹. 70,700 Discount allowed ₹. 18,800 8. Good transferred to Dept. M on selling price with the GP ratio of 25% on cost. 2 K2 Find the stock reserve of Dept. M from the following data: Opening stock of Dept. M ₹. 1,50,000 Closing stock of Dept. M ₹. 1,75,000 9. Find the shortage of stock: 2 K2 Good sent from H.O. ₹ 75,000 Returns to H.O. ₹ 4,500 Cash sales ₹ 45,750 Credit Sales ₹ 12,500 Opening stock ₹ 20,500 Closing stock ₹ 24,500 10. Calculate cash price of a bike from the following information: 2 K2 i. Down payment ₹ 80,000 ii. Four annual instalments at end of each year ₹ 80,000 iii. Rate of interest 5% p.a
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Q. No. SECTION C (2x10=20) CO KL
Answer any two questions 11. Following purchases were made by a business house having three departments. 3 K3 Department A 1,000 units Department B 2,000 units At the total of ₹ 1,00,000 Department C 2,400 units
Stock on 1st January were:
Department A 120 units Department B 80 units Department C 152 units The sales were Department A 1,020 units at ₹ 20.00 each Department B 1,920 units at ₹ 22.50 each Department C 2,496 units at ₹ 25.00 each The rate of gross profit is the same in each case. Prepare department trading account.
12 On 19th May, 2022, the premises of Mr. Das were destroyed by firm, but 3 K3 sufficient records were saved, wherefrom the following particulars were ascertained: Particulars ₹ Stock at cost on 1.1.2021 36,750 Stock at Cost 31.12.2021 39,800 Purchases less return during 2021 1,99,000 Sales less returns during 2021 2,43,500 Purchases less returns during 1.1.2022 to 19.5.2022 81,000 Sales less returns during 1.1.2022 to 19.5.2022 1,15,600 In valuing the stock for the balance sheet as at 31 Dec. 2021, ₹1,150 had been st
written off on certain stock which was a poor selling line having the cost ₹ 3,450. A portion of these goods were sold in March 2022 at a loss of ₹ 125 on original cost of ₹ 1,725. The reminder of this stock was now estimated to be worth the original cost. Subject to the above exceptions, gross profit has remained at a uniform rate throughout. The stock salvaged was ₹ 2,900. Show the amount of the claim of stock destroyed by fire. Memorandum trading account to be prepared for the period from 1.1.2022 to 19.5.2022 for normal and abnormal items. 13. The books of a firm had the following balance on January 1, 2022. 3 K3 Particulars ₹ Sundry debtors 85,000 Sundry creditors 60,000 Provision for doubtful debts 1,700 Provision for discount on debtors 1,666 Provision for discount on creditors 600 The sundry debtors and creditors at December 31, 2022 stand at ₹ 1,25,000 and ₹ 83,000 respectively. Bad debts during the year were ₹ 1,500 and discounts allowed and earned were ₹ 166 and ₹ 500 respectively. You are required to show relevant ledger accounts and create provision for doubtful debts at 3% and provision for discount on debtors and creditors at 2%. …3 /3/ 23CM/MC/FA13
Q. SECTION D (2x10=20) CO KL No. Answer any two questions 14. From the following particulars, prepare the Department Trading and Profit & Loss A/c 4 K4 for the year ending 31.12.2022. Dept. X Dept. Y ₹ ₹ Stock (1.1.2022) 9,000 8,400 Sales 42,000 36,000 Purchases 27,000 21,600 Direct expenses 5,490 8,520 Postage 360 360 Stock (31.12.2022) 10,800 4800 Indirect expenses for the entire business was ₹ 3,900 which are to be divided in the proportion of sales of the two departments.
15. A Head office in Delhi sends good to its branch at Chennai marked 20% above cost. 4 K4 From the following particulars, show how the Branch Account will appear in the Head Office books. Also give the journal entries necessary for the Head Office to adjust the branch account. Particulars ₹ Particulars ₹ Stock on 1-7-22 at the branch 3,600 Cheques sent to branch: Debtor on 1-7-22 at the branch 6,000 Salary ₹ 1,800 Petty cash on 1-7-22 at the branch 60 Rent & tax ₹ 300 Goods supplied to branch 60,000 Petty cash ₹ 220 2,320 Remittances from Branch: Stock at Branch on 31.12.22 6,000 Cash sales ₹ 12,000 Debtors at branch on 31.12.22 9,600 Received from debtors ₹ 42,000 54,000 Branch Petty cash on 31.12.22 40
16. From the following information, compute the amount of claim under loss of profit 4 K4 policy: a. Indemnity period 13 months. b. Sum insured ₹ 2,00,000 c. Turnover, last financial year ended Dec. 31, 2021 ₹ 12,00,000 d. Gross profit (net profit + insured standing charges) ₹ 2,40,000 giving a gross profit are of 20% e. Net profit plus all standing charges ₹ 2,90,000 (₹ 50,000 of the standing charges are not insured). f. Fire occurs on 31st March, 2022 and affects business for 6 months. g. Turnover for 12 months ended 31st March, 2022 ₹ 11,70,000 h. Turnover: 1.4.2021 to 30.9.2021 ₹ 5,00,000 1.4.2022 to 30.9.2022 ₹ 3,00,000 Reduction in turnover ₹ 2,00,000 i. Sales amounting ₹ 1,60,000 generated in period 1.4.2022 to 30.9.2022 by incurring additional expenses of ₹ 30,000 j. Saving in insured standing charges in the indemnity period ₹ 10,000.
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Q. SECTION E (2x20=40) CO KL No. Answer any two questions 17. From the following Trial Balance of Thiru. Mukesh on 31 March 2023, Prepare Trading 5 K5 & Profit & Loss A/c and Balance Sheet taking into account the adjustments: Amount Amount Debit Balances Credit Balances (₹) (₹) Land & building 42,000 Capital 62,000 Machinery 20,000 Sales 98,780 Patents 7,500 Return outwards 500 Stock (1/4/2022) 5,760 Sundry creditors 6,300 Sudsy debtors 14,500 Bills payable 9,000 Purchases 40,675 Cash in hand 540 Cash at Bank 2,630 Return Inwards 680 Wages 8,480 Fuel & power 4,730 Carriage on sales 3,200 Carriage on Purchases 2,040 Salaries 15,000 General expenses 3,000 Insurance 600 Drawings 5,245 Total 1,76,580 Total 1,76,580 Adjustments a. Stock on 31/03/2023 was ₹ 60,800. b. Salary outstanding ₹ 1,500. c. Insurance prepaid ₹ 150. d. Depreciation Machinery @ 10% and patents @ 20%. e. Create a provision of 2% on debtors for bad debts. 18. T. Nagar head office supplies to its branch at Tambaram at invoice price which is cost 5 K5 plus 50%. From the following particulars related to Tambaram Branch for the year 2022, prepare Branch Stock A/c, Branch Debtors A/c, Branch Expenses A/c and Branch adjustment A/c. Particulars ₹ Particulars ₹ Opening stock (at invoice price) 1,20,000 Discount allowed to debtors 4,800 Opening Debtor 24,000 Expenses (paid by head office) Opening Petty Cash 200 Rent ₹ 4,800 Good received from Head 3,92,000 Salaries ₹ 48,000 Office (at invoice price) Goods Return to head office 6,000 Petty cash ₹ 2,000 54,800 Credit sales less return 1,68,000 Cash sales 2,40,000 Allowance to customer off Closing stock (at invoice 1,08,000 selling price (already adjusted 4,000 price) while invoicing) Cash received from debtor 1,80,000 Closing petty cash 200 …5 /5/ 23CM/MC/FA13
19. M/s. Arun Ltd. purchased 2 machines Costing ₹ 1,20,000 each from M/s. Joe Ltd. on 5 K5 1st January, 2021 on the Hire Purchase system. The terms were. Payment on delivery ₹ 30,000 for each machine. Reminder in 3 equal instalments together with interest at 10% p.a to be paid at the end of each year. M/s. Arun Ltd. writes off 25% depreciation each year on the diminishing balance method. M/s. Arun Ltd. paid the instalment due on 31st December, 2021 and on 31st December, 2022 but could not pay the final instalment. M/s. Joe Ltd. repossessed one machine adjusting its value against the amount due. The repossession was done on the basis of 30% depreciation on the diminishing balance method. The vendor spent ₹ 12,840 for the repairs and overhauling of the machine and sold it for ₹ 60,000. You are required to prepare ledger account in the books of both the parties. 20. X & Y are partners of Zudu & Co. sharing profits and losses in the ratio of 3:1 and Y & Z 5 K5 are partners in Rely & Co. sharing profits and losses in the ratio of 2:1. On 31st March, 2023, they decide to amalgamate and form a new firm M/s. Venture & Co., wherein X, Y & Z would be partners sharing profits and losses in the ration of 3:2:1. The balance sheets of two firms on the above date are as under: Zudu & Rely & Zudu & Rely & Liabilities Assets Co. Co. Co. Co. Capital Fixed Assets: X 2,40,000 ---- Building 50,000 60,000 Y 1,60,000 2,00,000 Plant and machinery 1,50,000 1,60,000
Due to Zudu & Co ---- 1,00,000 Sundry debtors 1,60,000 2,00,000
Bank overdraft 80,000 ---- Bank balance 30,000 90,000
Cash in hand 20,000 10,000 Due from Rely & 1,00,000 ---- Co 6,50,000 6,66,000 6,50,000 6,66,000
The amalgamated firm took over the business on the following terms: i. Building of Zudu & Co was valued at ₹1,00,000 ii. Plant and machinery of Zudu & Co. was valued at ₹2,50,000 and that of Rely & Co. at ₹2,00,000. iii. All stock in trade is to be appreciated by 20%. iv. Goodwill valued of Zudu & Co. at ₹ 1,20,000 and Rely & Co. at ₹ 60,000, but the same will not appear in the books of Venture & Co. v. Provisions for doubtful debts has to be carried forward at ₹ 12,000 in respect of debtors of Zudu & Co. and ₹ 26,000 in respect of debtors of Rely & Co. You are required to prepare the balance of new firm and capital accounts of the partners in the books of old firms.
