CA FOUNDATION ACCOUNTS TEST

TEST
CA Foundation Test 5
All Questions compulsory.
Working notes will be part of the answer.
MARKS 80

1. E Ltd. sends out its accounting machines costing ` 200 each to their customers on Sales
or Return basis. All such transactions are, however, treated like actual sales and are
passed through the Day Book. Just before the end of the financial year, i.e., on March
24, 2016, 300 such accounting machines were sent out at an invoice price of ` 280
each, out of which only 90 accounting machines are accepted by the customers ` 250
each and as to the rest no report is forthcoming. Show the Journal Entries in the books
of the company for the purpose of preparing Final Accounts for the year ended March
31, 2016.
(5 Marks)

2. S. Ltd. sends out its goods to dealers on Sale or Return basis. All such transactions are,
however, treated as actual sales and are passed through the Day Book. Just before the
end of the accounting year on 31.03.2016, 200 such goods have been sent to a dealer at
`250 each (cost ` 200 each) on sale or return basis and debited to his account. Of
these goods, on 31.03.2016, 50 were returned and 70 were sold while for the other goods,
date of return has not yet expired. Pass necessary adjustment entries on 31.03.2016.
(5 Marks)
3. Journalize the following in the books of Don:
a) Bob informs Don that Ray’s acceptance for ` 3,000 has been dishonoured and noting
charges are ` 40. Bob accepts ` 1,000 cash and the balance as bill at three months
at interest of 10%.Don accepts from Ray his acceptance at two months plus interest
@ 12% p.a.
b) James owes Don ` 3,200; he sends Don’s own acceptance in favour of Ralph for `
,160; in full settlement.
c) Don meets his acceptance in favour of Singh for ` 4,500 by endorsing John’s
acceptance for ` 4,450 in full settlement.

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CA FOUNDATION ACCOUNTS TEST

d) Ray’s acceptance in favour of Don retired one month before due date, interest is
taken at the rate of 6% p.a.
(10 Marks)

4. (5 Marks)
i. On 1.1.2017, A draws a bill on B for `1,20,000 for 3 months’ maturity date of the bill
will be:
(a) 1.4.2017 (b) 3.4.2017 (c) 4.4.2017

ii. PQ draws a bill on XY for `130,000 on 1.1.2017. X accepts the same on 4.1.2017 for
period of 3 months after date. What will be the maturity date of the bill:
(a) 4.4.2017 (b) 3.4.2017 (c) 7.4.2017

iii. A draws a bill on B. A endorsed the bill to C. The payee of the bill will be
(a) A (b) B (c) C

iv. X sold goods to Y for ` 5,00,000. Y paid cash `4,30,000. X will grant 2% discount on
balance, and Y request X to draw a bill for balance, the amount of bill will be:
(a) ` 98,000 (b) ` 68,000 (c) ` 68,600

v. XZ draws a bill on YZ for ` 2,00,000 for 3 months on 1.1.2017. The bill is discounted
with banker at a charge of `1,000. At maturity the bill return dishonoured. In the
books of XZ, for dishonour, the bank account will be credited by:
(a) `199,000 (b) ` 200,000 (c) ` 201,000

5. Miss Rakhi consigned 1,000 radio sets costing `900 each to Miss Geeta, her agent on 1st
July,2016. Miss Rakhi incurred the following expenditure on sending the consignment.
Freight ` 7,650

Insurance ` 3,250
Miss Geeta received the delivery of 950 radio sets. An account sale dated 30th
November,2016 showed that 750 sets were sold for `9,00,000 and Miss Geeta incurred
`10,500 for carriage.

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CA FOUNDATION ACCOUNTS TEST

Miss Geeta was entitled to commission 6% on the sales eVected by her. She incurred
expenses amounting to `2,500 for repairing the damaged radio sets remaining in the
inventories.
Miss Rakhi lodged a claim with the insurance company which was admitted at `35,000.
Show the Consignment Account and Miss Geeta’s Account in the books of Miss Rakhi.
(10 Marks)

6. From the following information (as on 31.3.2017), prepare a bank reconciliation statement
after making necessary amendments in the cash book:
Particulars
Bank balances as per the cash book (Dr.) 32,50,000
Cheques deposited, but not yet credited 44,75,000
Cheques issued but not yet presented for payment 35,62,000
Bank charges debited by bank but not recorded in the cash-book 12,500
Dividend directly collected by the bank 1,25,000
Insurance premium paid by bank as per standing instruction not 15,900
intimated
Cash sales wrongly recorded in the Bank column of the cash-book 2,55,000
Customer’s cheque dishonoured by bank not recorded in the cash-book 1,30,000
Wrong credit given by the bank 1,50,000
Also show the bank balance that will appear in the trial balance as on 31.3.2017.
( 10 Marks)

7. On 31st March 2017, the Bank Pass Book of Namrata showed a balance of ` 1,50,000 to
her credit while balance as per cash book was ` 1,12,050. On scrutiny of the two books,
she ascertained the following causes of dierence:
a) She has issued cheques amounting to ` 80,000 out of which only ` 32,000 were
presented for payment.
b) She received a cheque of ` 5,000 which she recorded in her cash book but forgot to
deposit in the bank.
c) A cheque of ` 22,000 deposited by her has not been cleared yet.

d) Mr. Gupta deposited an amount of ` 15,700 in her bank which has not been recorded
by her in Cash Book yet.
e) Bank has credit an interest of ` 1,500 while charging ` 250 as bank charges.

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CA FOUNDATION ACCOUNTS TEST

Prepare a bank reconciliation statement.

(5 Marks)

8. The following errors were found in the book of Ram Prasad & Sons. Give the necessary
entries to correct them.
1. ` 500 paid for furniture purchased has been charged to ordinary Purchases Account.

2. Repairs made were debited to Building Account for ` 50.

3. An amount of `100 withdrawn by the proprietor for his personal use has been debited
to Trade Expenses Account.
4. `100 paid for rent debited to Landlord’s Account

5. Salary `125 paid to a clerk due to him has been debited to his personal account

6. `100 received from Shah & Co. has been wrongly entered as from Shaw & Co.

7. ` 700 paid in cash for a typewriter was charged to Office Expenses Account.

8. A purchase of goods from Ram amounting to `150 has been wrongly entered through
the Sales Book.
9. A Credit sale of goods amounting `120 to Ramesh has been wrongly passed through
the Purchase Book.
10. On 31st December, 2016 goods of the value of `300 were (10
Marks)

9. The following was the Receipts and Payments Account of Exe Club for the year ended
March. 31, 2016
Receipts ` Payments `
Cash in hand 100 Groundsman’s Fee 750
Balance at Bank as per Pass Moving Machine 1,500
Book:
Deposit Account 2,230 Rent of Ground 250
Current Account 600 Cost of Teas 250
Bank Interest 30 Fares 400
Donations and Subscriptions 2,600 Printing & Office Expenses 280
Receipts from teas 300 Repairs to Equipment 500
Contribution to fares 100 Honorarium to Secretary and

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CA FOUNDATION ACCOUNTS TEST

Sale of Equipment 80 Treasurer of 2015 400

Net proceeds of Variety Balance at Bank as per Pass
Book:
Entertainment 780 Deposit Account 3,090
Donation for forth coming Current Account 150
Tournament 1,000 Cash in hand 250
7,820 7,820
You are given the following additional information:
Particulars April, 1, 2015 March, 31, 2016
` `
Subscription due 150 100
Amount due for printing etc. 100 80
Cheques unpresented being payment for repairs 300 260
Estimated value of machinery and equipment 800 1,750
Interest not yet entered in the Pass book 20
Bonus to Groundsman o/s. 300
For the year ended March. 31, 2016, the honorarium to the Secretary and Treasurer are to be increased
by a total of `200.

(10 Marks)

10. Mr. Vimal runs a factory which produces soaps. Following details were available in
respect of his manufacturing activities for the year ended on 31.3.2016:
Opening Work-in-Process (10,000 units) 16,000
Closing Work-in-Process (12,000 units) 20,000
Opening inventory of Raw Materials 1,70,000
Closing inventory of Raw Materials 1,90,000
Purchases 8,20,000
Hire charges of machine @ `0.60 per unit manufactured
Hire charges of factory 2,20,000
Direct wages-Contracted @ ` 0.80 per unit manufactured and @ ` 0.40 per
unit of
Closing W.I.P.
Repairs and Maintenance 1,80,000

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CA FOUNDATION ACCOUNTS TEST

Units produced – 5,00,000 units

Required
Prepare a Manufacturing Account of Mr. Vimal for the year ended 31.3.2016.
(5 Marks)

11. Mr. Mohan gives you the following trial balance and some other information:

Trial Balance as on 31st March, 2017

Particulars ` `
Capital 6,50,000
Sales 9,70,000
Purchases 4,30,000
Opening Inventory 1,10,000
Freights Inward 40,000
Salaries 2,10,000
Other Administration Expenses 1,50,000
Furniture 3,50,000
Trade receivables and Trade payables 2,10,000 1,90,000
Returns 20,000 12,000
Discounts 19,000 9,000
Bad Debts 5,000
Investments in Government Securities 1,00,000
Cash in Hand and Cash at Bank 1,87,000
18,31,000 18,31,000

Other Information:
(i) Closing Inventory was ` 1,80,000;
(ii) Depreciate Furniture @ 10% p.a.

Required
Prepare Trading and Profit and Loss Account for the year ended on 31.3.2017 and
Balance Sheet of Mr. Mohan as on that date.

(5 Marks)

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