KENDRIYA VIYALAYA SANGATHAN KOLKATA REGION

PRE-BOARD EXAMINATION (TERM - I )

SESSION-2021-22
SUBJECT-ACCOUNTANCY(055)
CLASS : XII
TIME : 90 MIN MAX MARKS : 40
General Instructions:
Read the following instructions very carefully and strictly follow them:
1. This question paper comprises three PARTS – I, II. There are 55 questions in the question
paper.
2. There is an internal choice provided in each Sections.
I. Part-I, contains three Sections -A, B and C. Section A has questions from 1 to 18 and
Section B has questions from 19 to36, you have to attempt any 15 questions each in both the
sections.
II. Part I, Section C has questions from 37 to 41. You have to attempt any four questions.
III. Part II, contains two Sections – A and B. Section A has questions from 42 to 48, you have
to attempt any five questions and Section B has questions from 49 to 55, you have to
attempt any six questions.
3. All questions carry equal marks. There is no negative marking.

PART-I SECTION-A (From the Q .No 1 to 18, attempt any 15 questions)

Q1. At the time of admission of a partner, what will be the effect of the following information?
Balance in Workmen compensation reserve Rs.80,000. Claim for workmen compensation
Rs. 85,000.
(a) Rs. 85,000 Debited to the Partner’s capital Accounts
(b) Rs. 80,000 Debited to Revaluation Account
(c) Rs. 5,000 Debited to Revaluation Account
(d) Rs. 5,000 Credited to Revaluation Account
Q2. As per Section 52 of Companies Act 2013, Securities Premium Reserve can be utilised
for:
(a) Redemption of debentures
(b) For Repayment of long term borrowings
(c) Writing off discount on issue of securities
(d) Purchase of Fixed assets
Q3. Following amounts were payable on issue of shares by a Company: Rs.3 on application,
Rs.3 on allotment. Rs.2 on first call and Rs.2 on final call. X holding 500 shares paid only
application and allotment money whereas Y holding 400 shares did not pay final call.
Amount of calls in arrear will be :
(A) Rs.3,800
(B) Rs.2,800
(C) Rs.1,800
(D) Rs.6,200
Q4. Calculate the amount of second & final call when AXE Ltd, issues Equity shares of ₹10
each at a premium of 20% payable on Application ₹3, On Allotment ₹4, On First Call ₹2.
(A) Second & final call ₹3.
(B) Second & final call ₹4.
(C) Second & final call ₹1.
 (D) Second & final call ₹14
Q5. Sun Shine Ltd, issued a prospectus inviting applications for 3,000 shares. Applications
were received for 4,000 shares and pro- rata allotment was made to the applicants of 3,600
shares. If Ramesh has been allotted 90 shares, how many shares he must have applied for?
(A) 100
(B) 120
(C) 108
(D) 80
Q6. Punjab and Sikkim are partners sharing profits in the ratio of 3:2. Rajasthan is admitted
with 1/5th share and he brings in ₹84,000 as his share of goodwill which is Credited to the
Capital Accounts of Punjab and Sikkim respectively with 63,000 and 21,000. New profit
sharing ratio will be:
a) 3:1:5
b) 9:7:4
c) 3:2:5
d) 7:9:4
Q7. A and B are partners in a partnership firm without any agreement. A has withdrawn Rs
50,000 out of his Capital as drawings. Interest on drawings may be charged from A by the
firm :
a. @ 5% Per Annum
b. @ 6% Per Annum
c. @ 6% Per Month
d. No interest can be charged
Q8. R and S are partners sharing profits in the ratio of 2:1. S has advanced a loan of Rs
1,00,000 to the firm on 1st October, 2020. The net profit earned by the firm for the year
ending 31st March, 2021 is Rs 90,000. What amount will be credited to S’s capital
account?
a. Rs 60,000
b. Rs 30,000
c. Rs 29,000
d. Rs 32,000.

Q9. Charulata is a partner in a firm. She withdrew Rs.10,000 in middle of each quarter during
the year ended 31st March, 2019. Interest on her drawings @ 9% p.a. will be:
a. Rs.1,350
b. Rs.2,250
c. Rs.900
d. Rs.1,800
Q10. Amar and Akbar were partners sharing profits and losses in the ratio of 7:5. They agree to
admit Antony, their manager, into partnership who is to get 1/6th share in the profits. He
acquires this share as 1/24th from Amar and 1/8th from Akbar. The new profit sharing
ratio will be:
a) 13:7:4
b) 7:13:4
c) 7:5:6
 d) 5:7:6

Q11. Where would you record the interest on drawings when capitals are fluctuating?
a. Partners’ Fixed Capital A/c
b. Partners’ Current A/c
c. Either of the two
d. Partners’ Capital A/c
Q12. Weighted average profit method of calculating goodwill is used when:

(a) Profits are not equal

(b) Profits show a increasing trend

(c) Profits are fluctuating

(d)None of the above

Q13. When shares are issued to promoters which account should be debited?
(a) Share capital a/c
(b) Promoters a/c
(c) Assets a/c
(d) Goodwill a/c

Q14. Shared offered to general public for contribution are called?

(a) Authorized shares
(b) Called up shares
(c) Issued shares
(d) Subscribed shares
Q15. From the following information, calculate value of goodwill of the firm by capitalization
method. Total capital of the firm Rs. 16,00,000 Normal rate of return 10%. Profit for the
year Rs. 2,00,000
a) 4,00,000
b) 1,00,000
c) 2,00,000
d) 2,50,000
Q16. Milk and Curd are partners sharing profits and losses as 2:1. Ghee is admitted and profit
sharing ratio becomes 4:3:2. Goodwill is valued at ₹94,500. Ghee brings required
goodwill in cash. Goodwill amount will be credited to:
a) Milk ₹14,000 and Curd ₹7,000
b) Milk ₹12,000 and Curd ₹9,000
c) Milk ₹21,000
d) Milk ₹94,500
Q17. Arjun and Beem share profits in the ratio of 2:1. Nakul is admitted with ¼ share in profits.
Nakul acquires ¾ of his share from Arjun and ¼ of his share from Beem. The new ratio
will be:
a) 2:1:1
 b) 23:13:12
c) 3:1:1
d) 13:23:12
Q18. P and Q are partners sharing profits and losses as 2:1. R and S are admitted and Profit
sharing ratio becomes 3:2:4:1. Goodwill is valued at ₹90,000. R and S bring required
goodwill in cash. Credit will be given to:
a. P ₹30,000; Q ₹15,000
b. P ₹66,000; Q ₹24,000
c. P ₹33,000; Q ₹12,000
d. P ₹27,000 ; Q ₹18,000
PART-I SECTION-B (From the Q .No 19 to 36, attempt any 15 questions)
Q19. Ramesh, Sumesh and Girish sharing profits and losses in the ratio of 4:3:2, decided to
admit Manish as a new partner with effect from 1st April, 2021. Their Balance Sheet as at
31st March showing an investment of ₹ 20,0,00 and Investment Fluctuation Reserve ₹
18,000.If the market value of investment is ₹ 1,91,000, What would be the accounting
treatment?

a. ₹ 9,000 can distribute among partners and debit to their capital account.
b. ₹ 18,000 can distribute among partners and credit to their capital account.
c. ₹ 9,000 should transferred to Investment account
d. ₹ 18,000 should show in the Reconstituted firms’ Balance sheet

Q20. At the time of admission of a new partner, Which adjustments are required

a. Accounting treatment of Goodwill.

b. Accounting treatment of accumulated profit.
c. Calculation of new profit sharing ratio and sacrificing ratio.
d. All of the options
Q21. Match the following:
i. Sacrificing Ratio A Nominal Account
ii. Gaining Ratio B Reconstitution of Partnership
iii. Revaluation Account C New Ratio – Old Ratio
iv. Admission of a Partner D Old Ratio – New Ratio

a) i- B, ii-C, iii-A, iv-D

b) i- D, ii-B, iii-A, iv-C
c) i- D, ii-C, iii-A, iv-B
d) i- D, ii-C, iii-B, iv-A
Q22. Assertion (A): Guarantee of minimum profit may be given to a partner.
Reason(R): It is compulsory as per Indian Partnership Act, 1932.
a. Both (A) and (R) are true and (R) is the correct explanation of (A)
b. Both (A) and (R) are true and (R) is not the correct explanation of (A)
c. ‘(A) is true, but (R) is false
d. ‘(A) is false, but (R) is true.
Q23. Akhil and Ravi are partners sharing profits and losses in the ratio of 7:3 with capitals of
Rs 8,00,000 and Rs 6,00,000 respectively. According to partnership deed interest on
capital is to be provided @ 8% p.a. and is to be treated as a charge. Profit for the year
isRs80,000. Choose the correct option:
a. A will be credited by Rs 64,000 and B will be credited by Rs 48,000.
b. A will be credited by Rs 56,000 and B will be credited by Rs 24,000.
c. A will be credited by Rs 22,400 and B will be credited by Rs 9,600.
d. A will be credited by Rs 41,600 and B will be credited by Rs 38,400.

Q24. A and B are partners. B draws a fixed amount at the end of every month. Interest on
drawings is charged @15% p.a. At the end of the year interest on B’s drawings amounted
to Rs 8,250. Drawings of B were:
a. Rs 12,000 p.m.
b. Rs 10,000 p.m.
c. Rs 9,000 p.m.
d. Rs 8,000 p.m.

Q25. P and Q are partners sharing profits and losses in the ratio of 2:1 with capitals Rs 1,00,000
and Rs 80,000 respectively. The interest on capital has been provided to them @ 8%
instead of 10%. In the rectifying adjustment entry, Q will be:
a. Debited by Rs 400
b. Credited by Rs 400
c. Debited by Rs 1600
d. Credited by Rs 1600.

Q26. Assertion: (A) Goodwill is considered as an intangible asset but not a fictitious asset
Reason ( R ) Goodwill can neither be seen and touched nor it can be purchased or sold
with any other asset
a) Both Assertion ( A) and Reason ( R) are true and Reason (R ) is the correct explanation
of Assertion ( A)
b) Both Assertion (A) and Reason (R ) are true but Reason ® is not the correct
explanation of assertion (A)
c) Assertion (A) is false, but Reason (R) is true
d) Assertion (A) is true but Reason (R) is false
Q27. A Building was purchased for ₹9,00,000 and payment was made by shares of Rs. 100
each at 20% premium. Securities Premium Reserve A/c will be ……………….
(A) Debited by ₹1,50,000
(B) Credited by ₹1,50,000
(C) Debited by ₹1,80,000
(D) Credited by ₹1,80,000

Q28. 4000 equity shares of ₹10 each were issued @ 8% premium to the promoters of a
company for their services. Which account will be debited?
(A) Share Capital Account
 (B) Incorporation Cost Account
(C) Securities Premium Reserve
(D) Cash Account

Q29. The firm of P, Q and R with profit sharing ratio of 6:3:1, had the balance in General
Reserve Account amounting Rs. 1,80,000. S joined as a new partner and the new profit
sharing ratio was decided to be 3:3:3:1. Partners decide to keep the General Reserve
unchanged in the books of accounts. The effect will be:
(a)P will be credited by Rs. 54,000
(b)P will be debited by Rs. 54,000
(c)P will be credited by Rs. 36.000
(d)P will be credited by Rs. 36,000

Q30. A company issued 4,000 equity shares of Rs.10 each at par payable as under : On
application Rs.3; on allotment Rs.2; on first call Rs.4 and on final call Rs.1 per share.
Applications were received for 13,000 shares. Applications for 3,000 shares were rejected
and pro-rata allotment was made to the applicants for 10,000 shares. How much amount
will be received in cash on first call? Excess application money is adjusted towards
amount due on allotment and calls
(A) Rs.6,000
(B) Nil
(C) Rs.16,000
(D) Rs.10,000
Q31. Assertion : Call money may be called by the company to be paid by the shareholders in
one or more instalments.
Reason : call money does not exist in shares.
(a) Both assertion and reason are correct and reason is the correct explanation for assertion
b) Both assertion and reason are correct and reason is not the correct explanation for
assertion
(c) Assertion is True but reason is False
(d) Assertion is False but reason is True.
Q32. Any profit from the revaluation account is _____ in the partner's capital account in the
____ ratio.
(a) Debited; new
(b) Debited ; old
(c) Credited ; new
(d) Credited ; old

Q33. A company purchased machinery for ₹1,80,000 and in consideration issued shares at 20%
premium. What will be the face value of shares issued :
(A) ₹1,50,000
(B) ₹1,44,000
(C) ₹1,80,000
(D) ₹2,16,000

Q34. Shares issued by a company to its employees or directors in consideration of ‘Intellectual

 Property Rights’ are called:
(A) Right Equity Shares
(B) Private Equity Shares
(C) Sweat Equity Shares
(D) Bonus Equity Shares

Q35. A, B, and C are partners in profit sharing ratio 2:3:4 with effect from 1st April 2021, they
decided to share profits in 4:3:3. What is B’s gain or sacrifice ?
(a) No gain / sacrifice
(b) Sacrifice 1/30
(c) Gain 3/100
(d) Gain 1/30

Q36. A Company issued 50,000 shares of ₹20 each at 5% premium. ₹10 were payable on
application and balance on allotment. What will be the allotment amount?
(A) ₹5,00,000
(B) ₹4,75,000
(C) ₹5,50,000
(D) ₹5,25,000

PART-I SECTION-C (From the Q .No 37 to 41, attempt any 4 questions)

Question no.37 to 38 are based on the hypothetical situation based given below:-
Bindiya limited was incorporated on 1stApril 2019 with registered office in Mumbai. The
capital clause of memorandum of Association reflected a registered capital of 8,00,000
equity shares of Rs.10 each and 1,00,000 preference shares of Rs.50 each. Since some
large investments were required for building and machinery the company in consultation
with vendors, M/S. VPS Enterprises, issued 1,00,000 equity shares and 20,000 preference
shares at par to them in full consideration of assets acquired.
Besides this the company issued 2,00,000 equity shares for cash at par payable as Rs 3 on
application, 2 on allotment, 3 on first call and 2 on second call. Till date second call has
not yet been made and all the shareholders have paid except Mr. Ajay who did not pay
allotment and calls on his 300 shares and Mr.Vipul who did not pay first call on his 200
shares. Shares of Mr. Ajay were then forfeited and out of them 100 shares were reissued at
Rs.12 per share.
Based on above information you are required to answer the following
37. Shares issue to vendors of building and machinery, Ms. VPS Enterprises, would be
classified as:
a. Preferential Allotment
b. Employee Stock Option Plan
c. Issue for Consideration other than cash
d. Right Issue of Shares
38. How many equity shares of the company have been subscribed?
a. 3,00,000
b. 2,99,500
c. 2,99,800
 d. None of these
Question no.39 to 41 are based on the hypothetical situation based given below:-
Reena, Meena and Teeka are partners sharing profit and loss equally. From 1st April
2019, they decided to share the profits in the ratio of 2:1:1. Reena share has been
increased because she introduced additional capital of Rs. 1,50,000. At the time of
reconstitution the following assets and liabilities are revalued and reassessed.
Read the following case study and answer the question no. 39 to 41 on the basis of the
same.
Items Book Figure (Rs) Revised Figure (Rs)
Free hold premises 7,50,000 8,00,000
Stock 2.25.000 2,00,000
Debtors 75,000 72,500
Furniture 1,00,000 90,000
Creditors 30,000 25,000
39. What is the net effect of revaluation?
(a) Profit 37,500
(b) Loss 37,500
(c) Profit 17,500
(d) Loss 17,500

40. Which of the partner made the gain?

(a) Reena
(b) Meena
(c) Teeka
(d) Both A and B

41. What was the sacrificing ratio?

(a) 2:1
(b) 1:1
(c) 1:2
(d) None of these.

PART-II SECTION-A (From the Q .No 42 to 48, attempt any 5 questions)

42. Assertion (A) Current ratio establishes relationship between Current Assets & Current
liabilities.
Reason (R): Current Ratio is a part of Activity Ratios
a) Both (A) and (R) are true and (R) is the correct explanation of (A)
(b) Both (A) and (R) are true and (R) is not the correct explanation of A
(c) (A) is true, but (R) is false
(d) (A) is false, but (R) is true
43. Which ratio is shown in times?
(a) Quick ratio
(b) Proprietary ratio
 (c) Current ratio
(d) None of above
44. The ………… of business firm is measured by its ability to satisfy its short term
obligation as they become due.
(a) Activity
(b) Liquidity
(c) Debt
(d) Profitability
45. Liquid ratio is also known as
a) Quick ratio
b) Acid test ratio
c) Working capital ratio
d) Stock turnover ratio
options:-
A) A and B
B) A and C
C) B and C
D) C and D
46. Balance sheet of a company is required to be prepared in the format given in
………………….
(A) Schedule III Part II
(B) Schedule III Part I
(C) Schedule III Part III
(D) Table A
47. Match the following.
(i) Share Option Outstanding (a) Other Long - term Liabilities
(ii) Money received against Share (b) Current Liabilities
warrants
(iii) Premium on Redemption of (c) Shareholders’ Funds
debentures
(iv) Provision for Tax (d) Shareholders’ Funds –
Reserves

(A) (i) d (ii) c (iii) a (iv) b

( B) (i) c (ii) d (iii) b (iv) a
(C) (i) a (ii) b (iii) c (iv) d
(D) (i) b (ii) a (iii) d (iv) c
48. Ideal Current Ratio is:
(A) 1:1
(B) 1:2
(C) 1:3
(D) 2:1

PART-II SECTION-A (From the Q .No 49 to 55, attempt any 6 questions)

49. A company’s current ratio is 2.5:1 and it working capital is Rs.60,000. If its inventory is
Rs.52,000 what will be the liquid ratio?
A. 2.3:1
B. 2.8:1
C. 2.5:1
D. 1.2:1
50. Fixed assets Rs.5,00,000, Current assets Rs.3,00,000 Equity share capital Rs.4,00,000
Reserves-Rs.2,00,000 Long -term debts Rs.40,000.
Proprietory ratio will be :
A. 75%
B. 80%
C. 125%
D. 133%
51. Which of the following statements are false?
a) When all the comparative figures in a balance sheet are stated as percentage of the total,
it is termed as horizontal analysis.
b) When financial statements of several years are analysed, it is termed as vertical
analysis.
c) Vertical Analysis is also termed as time series analysis.

Choose from the following options:

(A) Both (a) and (b)
(B) Both (a) and (c)
(C) Both (b) and (c)
(D) All three (a), (b), (c)

52. (A) Assertion – A low inventory ratio indicates that inventory does not sell quickly and
remains lying in the godown for quite a long time.
(R ) Reason- Inventory turnover ratio is a profitability ratio

(A) Both (A) and (R) are true and (R) is the correct explanation of (A)
(B) Both (A) and (R) are true and (R) is not the correct explanation of A
(C) (A) is true, but (R) is false
(D) (A) is false, but (R) is true
53. 73.(A) Assertion – Liquid assets will be converted into cash and cash equivalents very
shortly.
(R) Inventory is excluded from liquid assets because it has to be sold before it can be
converted into cash

(A) Both (A) and (R) are true and (R) is the correct explanation of (A)
(B) Both (A) and (R) are true and (R) is not the correct explanation of A
(C) (A) is true, but (R) is false
(D) (A) is false, but (R) is true
54. Opening Inventory Rs.1,00,000; Closing Inventory Rs.1,50,000; Purchases Rs.6,00,000;
Carriage Rs.25,000; wages Rs.2,00,000. Inventory Turnover Ratio will be:
(A) 6.6 Times
 (B) 7.4 Times
(C) 7 Times
(D) 6.2 Times
55. Share capital of a company consists of 5,00,000 shares of Rs 10 each ,Rs 8 called up.
All the shareholders have duly paid the called up amount. Share capital will be shown as :
(A) Subscribed and Fully paid up
(B) Subscribed but not Fully Paid
(C) Any of the above
(D) None of the above.