Accountancy: 2015: CBSE: [All India]: Set – II
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In the absence of Partnership Deed, interest on loan of a partner is allowed:
(i) at 8% per annum.
(ii) at 6% per annum.
(iii) no interest is allowed.
(iv) at 12% per annum.Marks:1
The answer is option (ii).
In absence of Partnership Deed, interest on loan of a partner is allowed at the rate of 6% per annum.
Geeta, Sunita and Anita were partners in a firm sharing profits in the ratio of 5:3:2. On 01.01.2015 they admitted Yogita as a new partner for share in the profits. On Yogita’s admission, the Profit and Loss Account of the firm was showing a debit balance of ₹ 20,000 which was credited by the accountant of the firm to the capital accounts of Geeta, Sunita and Anita in their profit sharing ratio.
Did the accountant give correct treatment? Give reason in support of your answer.Marks:1
Here, the treatment of Profit and Loss A/c (Dr.) is incorrect.
The debit balance of Profit and Loss A/c represents the loss to the firm. Therefore, at the time of admission of Yogita, it should be debited and not credited to the capital accounts of Geeta, Sunita and Anita, in their old profit sharing ratio.
On the death of a partner, his share in the profits of the firm till the date of his death is transferred to the:
(i) debit of Profit and Loss Account.
(ii) credit of Profit and Loss Account.
(iii) debit of Profit and Loss Suspense Account.
(iv) credit of Profit and Loss Suspense Account.Marks:1
The answer is option (iii).
On the death of a partner, his share in the profits of the firm till the date of his death is transferred to the debit of Profit and Loss Suspense Account.
Anant, Gulab and Khushbu were partners in a firm sharing profits in the ratio of 5:3:2. From 01.04.2014, they decided to share the profits equally. For this purpose the goodwill of the firm was valued at ₹ 2,40,000.
Pass necessary journal entry for the treatment of goodwill on change in the profit sharing ratio of Anant, Gulab and Khushbu.Marks:1
Gulab’s Capital A/c
Khushbu’s Capital A/c
To Anant’s Capital A/c
(Gulab and Khushbu, being the
gaining partners compensating
Anant for his share of sacrifice)
Give the meaning of forfeiture of shares.Marks:1
Forfeiture of shares implies cancellation of shares by the company issuing them, on non-payment of calls by the shareholders holding those shares.
Nirman Ltd. issued 50,000 equity shares of ₹10 each. The amount was payable as follows:
On application - ₹ 3 per share
On allotment - ₹ 2 per share
On first & Final call – The Balance
Applications for 45,000 shares were received and shares were allotted to all the applicants. Pooja, to whom 500 shares were allotted, paid her entire share money at the time of allotment, whereas Kundan did not pay the first and final call on his 300 shares. The amount received at the time of making first and final call was:
The answer is option (iii).
Calculation of amount received with first call:
First Call amount receivable on
45,000 shares x ₹ 5
Less: Pooja paid in advance
(500 @ ₹ 5)
Less: Kundan did not pay first call
(300 @ ₹ 5)
State any three purposes other than ‘issue of bonus shares’ for which securities premium can be utilized.Marks:3
Securities premium can be utilized for the following purposes:
i. For writing off the preliminary expenses of the company
ii. For writing off the expenses of, or the commission paid or discount allowed on, any issue of shares or debentures of the company
iii. For paying up the premium that is to be payable on redemption of preference shares or debentures of the company.
On 01.04.2013, Brij and Nandan entered into partnership to construct toilets in government girl’s schools in the remote areas of Uttarakhand. They contributed capitals of ₹ 10,00,000 and ₹ 15,00,000 respectively. Their profit sharing ratio was 2:3 and interest allowed on capital as provided in the Partnership Deed was 12% per annum. During the year ended 31.03.2014, the firm earned a profit of ₹ 2,00,000.
Prepare Profit and Loss Appropriation Account of Brij and Nandan for the year ended 31.03.2014.Marks:3
Profit & Loss Appropriation Account
For the year ended March 2014
Interest on Capital
Profit & Loss A/c
Note: Interest on capital is to be treated as an appropriation of profits and is to be provided to the extent of availability of profits, i.e, ₹2,00,000.
‘India Auto Ltd.’ Is registered with an authorized capital of ₹ 7,00,00,000 divided into 7,00,000 shares of ₹ 100 each. The company issued 50,000 shares to the vendor for building purchased and 2,00,000 shares were issued to the public. The amount was payable as follows:
On application and allotment – ₹ 20 per share
On first call –₹ 50 per share
On second and final call – The balance
All calls were made and were duly received except on 100 shares held by Rajani, who failed to pay the second and final call. Her shares were forfeited.
Present the ‘Share Capital’ in the Balance Sheet of the company as per Schedule VI Part I of the Companies Act, 1956. Also prepare ‘Notes to Accounts’.Marks:3
Balance Sheet of India Auto Ltd.
I. Equity and Liabilities
a. Share Capital
b. Reserves and Surplus
a. Fixed Assets
a. Cash and Cash
Notes to Accounts:
7,00,000 shares of ₹ 100
2,50,000 shares of ₹ 100
Subscribed, Called-up and
2,49,900 shares of ₹ 100
Add: Shares Forfeited (100
shares of ₹ 70)
‘Good Blankets Ltd.’ are the manufacturers of woolen blankets. Blankets of the company are exported to many countries. The company decided to distribute blankets free of cost to five villages of Kashmir Valley destroyed by the recent floods. It also decided to employ 100 young persons from these villages in their newly established factory at Solan in Himachal Pradesh. To meet the requirements of funds for starting its new factory, the company issued 50,000 equity shares of ₹ 10 each and 2,000, 8% debentures of ₹100 each to the vendors of machinery purchased for ₹ 7,00,000.
Pass necessary journal entries for the above transactions in the books of the company. Also identify any one value which the company wants to communicate to the society.Marks:3
In the books of Good Blankets Ltd.
Dr. (₹ )
Cr. (₹ )
To Vendor A/c
(Being machinery purchased
To Equity share capital A/c
To 8% Debentures A/c
(Being 50,000 shares of ₹ 100
Each and 2000 8% debentures
of ₹ 100 each issued to vendor
Value which the company wants to communicate to society- Creation of employment opportunities for victims of flood affected area, to enable them to earn their livelihood.