SESSION: 2022-23

CLASS – XII Max. Marks – 80

SUBJECT – ACCOUNTANCY (055) Time: 3 Hrs.

GENERAL INSTRUCTIONS:
1. This question paper contains 32 questions. All questions are compulsory.
2. Question no.’s 1 to 20 are MCQ’s carrying 1 mark each.
3. Question no.’s 21 & 22 are Very Short answer type questions carrying 3 marks each.
4. Question no.’s 23 to 27 are Short answer type questions carrying 4 marks each.
5. Question no.’s 28 to 30 are Long answer type questions carrying 6 marks each.
6. Questions no.’s 31 & 32 are Very long answer type questions carrying 8 marks each.

SECTION – A
MULTIPLY CHOICE QUESTIONS
Q1 When is the Partnership Act enforced? 1
(A) when there is no partnership deed
(B) where there is a partnership deed but there are differences of opinion between the
partners
(C) when capital contribution by the partners varies
(D) when the partner’s salary and interest on capital are not incorporated in the
partnership deed

Q2 A and B are partners in a partnership firm without any agreement. A has withdrawn 1
₹50,000 out of his Capital as drawings. Interest on drawings may be charged from A by
the firm:
(A) @ 5% Per Annum (C) @ 6% per month
(B) @ 6% Per Annum (D) No interest can be charged

Q3 A, B and C are partners. A’s capital is ₹3,00,000 and B’s capital is ₹1,00,000. C has not 1
invested any amount as capital but he alone manages the whole business. C wants
₹30,000 p.a. as salary. Firm earned a profit of ₹1,50,000. How much will be each
partner’s share of profit:
(A) A ₹60,000; B ₹60,000; C ₹Nil (C) A ₹40,000; B ₹40,000 and C ₹40,000
(B) A ₹90,000; B ₹30,000; C ₹Nil (D) A ₹50,000; B ₹50,000 and C ₹50,000.
Q4 Vikas is a partner in a firm. His drawings during the year ended 31st March, 2019 were 1
₹72,000. If interest on drawings is charged @ 9% p.a. the interest charged will be :
(A) ₹324 (B) ₹6,480 (C) ₹3,240 (D) ₹648

Q5 X and Y are partners in a firm with capital of ₹1,80,000 and ₹2,00,000. Z was admitted 1
for 1/3rd share in profits and brings ₹3,40,000 as capital, calculate the amount of
goodwill:
(A) ₹2,40,000 (B) ₹1,00,000 (C) ₹1,50,000 (D) ₹3,00,000

Q6 H and K were partners sharing profits and losses in the ratio of 2:1. They admitted sham 1
as a partner for one fifth share in the profits. For the purpose the goodwill of the firm was
to be valued on the basis of the three years’ purchase of last five years average profit.
The profits for the year well:

Year 2017-18 2018-19 2019-20 2020-21 2021-22

Profits (₹) 50,000 50,000 75,000 (25,000) 50,000

(A) 24,000 (B) 30,000 (C) 1,20,000 (D) 1,50,000

Q7 X, Y and Z were in partnership sharing profits in the ratio 4 : 3 : 1. The partners agreed 1
to share future profits in the ratio 5 : 4 : 3. Each partner’s gain or sacrifice due to change
in ratio will be :
(A) X sacrifice 2/24; Y sacrifice 1/24; Z Gain 3/24
(B) X gain 2/24; Y gain 1/24; Z sacrifice 3/24
(C) X sacrifice 1/24; Y sacrifice 2/24; Z gain 3/24
(D) X sacrifice 2/24; Y gain 3/24; Z sacrifice 1/24

Q8 X, Y and Z are partners in a firm sharing profits in the ratio of 3 : 2 : 1. They decided to 1
share future profits equally. The Profit and Loss Account showed a Credit balance of
₹60,000 and a General Reserve of ₹30,000. If these are not to be shown in balance
sheet, in the journal entry:
(A) Cr. X by ₹15,000: Dr. Z by ₹15,000
(B) Dr. X by ₹15,000; Cr. Z by ₹15,000
(C) Cr. X by ₹45,000; Cr. Y by ₹30,000; Cr. Z by ₹15,000
(D) Cr. X by ₹30,000; Cr. Y by ₹30,000; Cr. Z by ₹30,000

Q9 A and B are partners in a business sharing profits and losses in the ratio of 7 : 3 1
respectively. They admit C as a new partner. A sacrificed 1/7th share of his profit and B
sacrificed 1/3rd of his share in favour of C. The new profit sharing ratio of A, B and C will
be:
(A) 3 : 1 : 1 (B) 2 : 1 : 1 (C) 2 : 2 : 1 (D) None of these

Q10 When balance sheet prepared after the new partnership assets and liabilities are 1
recorded at:
(A) Original Value (C) At current cost
(B) Revalued figure (D) As realized value

Q11 Partners A, B and C share the profits of a business in the ratio of 3 : 2 : 1 respectively. 1
They admit D who brings in ₹60,000 for his share of goodwill. A, B, C and D decide to
share the profits respectively in the ratio of 5 : 3 : 2 : 2. Credit will be given to :
(A) A ₹6,000; B ₹6,000 (C) A ₹30,000; B ₹20,000; C ₹10,000
(B) A ₹30,000; B ₹18,000; C ₹12,000 (D) A ₹30,000; B ₹30,000

Q12 What treatment is made of accumulated profits and losses on the retirement of a 1
partner?
(A) Credited to all partner’s capital accounts in old ratio.
(B) Debited to all partner’s capital accounts in old ratio.
(C) Credited to remaining partner’s capital accounts in new ratio.
(D) Credited to remaining partner’s capital accounts in gaining ratio.

Q13 A, B and C are partners sharing profits in the ratio of 5 : 2 : 1. If the new ratio on the 1
retirement of A is 3 : 2, what will be the gaining ratio?
(A) 11: 14 (B) 3 : 2 (C) 2 : 3 (D) 14 : 11

Q14 In the absence of any information regarding the acquisition of share in profit of 1
retiring/deceased partner by the remaining partner, it is assumed that they will acquire
his/ser share:
(A) Old Profit Sharing ratio (C) Equal Ratio
(B) New Profit Sharing Ratio (D) None of these

Q15 What journal entry will be recorded for writing off the goodwill already existing in 1
Balance Sheet at the time of retirement of a partner?
(A) Retiring Partner’s Capital A/c Dr. To Goodwill A/c
(B) All Partner’s Capital A/cs (including retiring) Dr. (in old ratio) To Goodwill A/c
(C) Remaining Partner’s Capital A/cs Dr. (in gaining ratio) To Goodwill A/c
(D) Remaining Partner’s Capital A/cs Dr. (in new ratio) To Goodwill A/c

Q16 What journal entry will be recorded for deceased partner’s share in profit from the closure 1
of last balance sheet till the date of his death?
(A) Profit and Loss A/c To Deceased Partner’s Capital A/c Dr. (B) Deceased Partner’s Capital A/c
To Profit and Loss A/c Dr.
(C) Deceased Partner’s Capital A/c To Profit and Loss Suspense A/c Dr. (D) Profit and
Loss Suspense A/c To Deceased Partner’s Capital A/c Dr.

Q17 A, B and C were partners sharing profits and losses in the ratio of 2 : 2 : 1. Books are 1
closed on 31st March every year. C dies on 1st November, 2021. Under the partnership
deed, the executors of the deceased partner are entitled to his share of profit to the date
of death, calculated on the basis of last year’s profit. Profit for the year ended 31st March,
2021 was ₹2,40,000. C’s share of profit will be :
(A) ₹32,000 (B) ₹28,000 (C) ₹28,800 (D) ₹48,000

Q18 At the time of dissolution of firm, at which stage the balance of partner’s capital accounts 1
is paid?
(A) After making the payment to third party’s loans
(B) Before making the payment of partners in respect of their loans
(C) After making the payment to third party for their loans as well as partners loans
(D) None of the above.

Q19 On dissolution of the firm, amount received from sale of unrecorded asset is credited to: 1
(A) Partner’s Capital Accounts (C) Realisation Account
(B) Profit and Loss Account (D) Cash Account
Q20 In the event of dissolution of firm, the partner’s personal assets are first used for payment 1
of the:
(A) Firm’s liabilities (C) None of these
(B) The personal liabilities (D) Any of the two

SECTION - B
VERY SHORT ANSWER TYPE QUESTIONS
Q21 A, B and C started business in partnership from 1 Oct, 2021 with 4:3:3 share in profits. A 3
however, personally guaranteed that C’s profit would not be less than ₹ 60,000 for whole
year. Net profit for the year ended 31 Dec, 2021 were Rs 60,000. Pass necessary journal
entries in the books of firm.

Q22 A and B sharing profits and losses in the ratio of 2:3, decide to share future profit and 3
losses equally with effect from 1st April, 2021. On 31st March, 2021 their balance sheet
showed Workmen Compensation Reserve of ₹ 40,000. Show the accounting treatment
under the following alternative cases:
Case (i) If a claim on account of workmen’s compensation is estimated at ₹25,000
Case (ii) If a claim on account of workmen’s compensation is estimated at ₹40,000
Case (iii) If a claim on account of workmen’s compensation is estimated at ₹50,000

SECTION - C
SHORT ANSWER TYPE QUESTIONS
Q23 P, Q and R were partners and the balance of their capital accounts on 1 April, 2021 were 4
₹ 8,00,000; ₹ 5,00,000 and ₹2,00,000 respectively. As per the terms of partnership
agreement interest on capital is to be allowed @10% p.a. and is to be charged on
drawings @ 12% p.a.
Partners withdrew as follows:
(i) P withdrew ₹ 10,000 p.m. at the end of each month;
(ii) R withdrew Rs. 1,20,000 during the year.
The profit for the year ended 31 March, 2022 amounted to Rs 4,30,000. You are required
to prepare journal entries.
OR
Lalan and Balan were partners in a firm sharing in the ratio of 3:2. Their fixed capitals on
1 April, 2017 were: Lalan ₹ 1,00,000 and Balan ₹ 2,00,000. They agreed allow interest
on capital @ 12% p.a. and change on drawings @15% p.a. the firm earned a profit,
before all above adjustment of ₹30,000 for the year ended 31 Mar, 2018. The drawings
of Lalan and Balan during the year were ₹ 3,000 and ₹ 5,000 respectively. Showing your
calculations clearly, prepare Profit and Loss Appropriation Account of Lalan and Balan.
The Interest on capital will be allowed even if the firm incurs a loss.

Q24 (a) X and Y are partners in a firm. The total assets valued by them is ₹ 100,000 including 2
cash ₹15,000 and total liabilities ₹30,000. The goodwill of the firm through 4 years’
purchase of super profit is valued ₹24,000. You have to calculate the average profit
earned by the firm if normal rate of return is given 10% p.a.

(b) From the above figures calculate goodwill through capitalization average profit 2
method.

Q25 A and B are partners sharing profit and losses as 2:1. On 1 st April, 2018 they admit C as 4
a partner for 1/4th share who pays ₹450,000 as goodwill privately. On 1 st April 2019, they
take D as a partner for 3/5th share who brings ₹4,00,000 as goodwill, out of which half is
withdrawn by the existing partners. On 1st April 2020; E is admitted as a partner for 1/6 th
share who brings ₹ 5,00,000 as goodwill which is retained in the business. Pass
necessary journal entries.

Q26 P, Q and R were partners in a firm sharing profits in 2: 2: 1 ratio. The Partnership Deed 4
provided that on the death of a partner his executors will be entitled to the following: a. Interest on
Capital @ 12% p.a. b. Interest on Drawings @ 18% pa c. Salary of Rs.12,000 p.a. d. Share in the
profit of the firm (up to the date of death) on the basis of previous year’s
profit.
P died on 31st May, 2016. His capital was Rs.80,000. He had withdrawn Rs.15,000 and
interest on his drawings was calculated as Rs.1,200. Profit of the firm for the previous
year ended 31st March, 2016 was Rs.30,000.
Prepare P’s Capital Account to be rendered to his executors.

Q27 Clarify the difference between firm’s debt and partner’s private debt. 4
OR
Clarify the difference between dissolution of partnership and dissolution of firm.

SECTION - D
LONG ANSWER TYPE QUESTIONS
Q28 A, B and C were partners. Their capitals were A - Rs.30,000; B – Rs.20,000 and C – 6
Rs.10,000 respectively. According to the Partnership Deed, they were entitled to an
interest on capital @ 5% p.a. In addition, B was also entitled to draw a salary of Rs.500
per month. C was entitled to a commission of 5% on the profits after charging the interest
on capital, but before charging the salary payable to B. The net profits for the year were
Rs.30,000 distributed in the ratio of capitals without providing for any of the above
adjustments. The profits were to be shared in the ratio of 5: 3: 2.
Pass necessary adjustment entry showing the workings clearly.

Q29 Find out New Profit Sharing ratio in the followings:

(A) A, B & C are partners sharing in the ratio of 4 : 3 : 2. They admit D for 1/9 th share. It 3
is agreed that A would retain his original share.
(B) A and B are partners sharing profits and losses in the ratio of 4:3. C is admitted for
3
1/5th share. A and B decided share equally in future.

Q30 Pritam and Naresh decided to dissolve their firm on 31 st March, 2022. The balance sheet 6
stood as under:

Liabilities ₹ Assets ₹
Capital Account Cash at bank 400
Pritam 40,000 Stock 21,500
Naresh 20,000 Bills receivables 8,800
Loan Account Debtors 45,000
Naresh 14,000 Less: Provision
Mrs. Pritam 10,000 for Bad Debts 1,500 43,500
Creditors 36,000 Furniture 3,000
Outstanding Rent 500 Plant and Machinery 23,000
Goodwill 20,000
Prepaid Insurance 300
1,20,500 1,20,500
The assets were realized as follows: Stock ₹20,000; Bills receivable ₹3,800; Furniture
₹5,100; Plant and machinery ₹35,000; Debtors at 10% less than book value.
Creditors allowed a discount of 5%. Pritam agreed to pay his wife’s loan Naresh agreed
to pay outstanding rent. Expenses on dissolution came to ₹800.
 Pritam and Naresh shared profit and losses in the ratio of capitals. Prepare Journal.

SECTION - E
VERY LONG ANSWER TYPE QUESTIONS
Q31 D and E were partners in a firm sharing profits in 3:1 ratio. On 1 st April, 2021 they admitted 8
F as a new partner for 1/4th share in the firm which he acquired from D. Their balance sheet
as at that date was as follows:
Liabilities ₹ Assets ₹
Capital Account Cash 44,000
C 100,000 Land & Building 50,000
D 70,000 Machinery 60,000
Creditors 54,000 Stock 15,000
General Reserve 32,000 Debtors 40,000
Less: Provision
for bad debts 3,000 37,000
Investments 50,000
2,56,000 2,56,000
F will bring ₹40,000 as his capital and the other terms agreed upon were:
(i) Goodwill of the firm was valued ₹24,000
(ii) Land & building were valued at ₹70,000
(iii) Provision for Bad debts was found be in excess ₹800
(iv) A liability for ₹2000 included in creditors was not likely arise.
(v) The capital of the partners be adjusted on the basis of F’s contribution of capital of
the firm.
(vi) Excess or shortfall, if any, be transferred current accounts.
Prepare Revaluation account, Partner’s capital accounts and the balance sheet of
the new firm.
OR
Following is the balance sheet of Amit and Vidya as at 31 st March, 2022
Liabilities ₹ Assets ₹
Capital Account Bank 20,000
Amit 110,000 Stock 30,000
Vidya 60,000 Plant & Machinery 120,000
Creditors Workmen’s 26,000 Goodwill 20,000
Compensation Reserve Debtors 44,000
Employees Provident Fund 30,000 Less: Provision for bad
16,000 debts 2,000 Profit 42,000
& Loss Account 10,000
2,42,000 2,42,000
On the above date, Chintan was admitted as a partner for 1/4 th share in the profit of the
firm with the following terms:
(i) ₹2,900 will be written off as Bad Debts.
(ii) Stock was taken over by Vidya at ₹35,000
(iii) Goodwill of the firm was valued at ₹40,000. Chintan brought his share of goodwill
premium in cash.
 (iv) Chintan brought proportionate capital and the capitals of the other partners were
adjusted on the basis of Chintan’s capital. For this necessary cash was be brought
in or paid off the partners as the may be.
Prepare Revaluation Account, Partners’ capital Account and balance sheet.

Q32 A, B and C are partners in a firm sharing profits in the ratio of 3:2:1. On 31 st March, 2022,
C retired. Following balances were disclosed by the balance sheet on this date:

(i) Capitals: A ₹ 10,00,000; ₹ 6,00,000 and C ₹ 4,40,000

(ii) Profit & Loss (Dr) ₹ 45,000

(iii) Advertisement Expenditure (Dr) ₹ 15,000

(iv) Revaluation of Assets and re-assessment of liabilities resulted in a loss of ₹ 60,000.

(v) On the retirement of C, goodwill is valued at ₹1,80,000.

The amount payable to C is agreed to be paid in two yearly instalments of ₹ 2,00,000
each including interest @ 10% p.a. on the outstanding balance during the first two
years and the balance including interest in the third year. Books are closed on 31 st
march every
year. You are required to prepare (A) Partners capital A/c 4
(B) Prepare C’s Loan Account till it is finally paid. 4