PRE-BOARD QUESTION PAPER 2022-23

SUBJECT ACCOUNTANCY 055

CLASS XII
TIME 3 HOURS MAX.MARKS 80
GENERAL INSTRUCTIONS:
1. This question paper contains 34 questions. All questions are compulsory.
2. This question paper is divided into two parts, Part A and B.
3. Both the parts are compulsory
4. Question 1 to 16 and 27 to 30 carries 1 mark each.
5. Questions 17 to 20, 31and 32 carries 3 marks each.
6. Questions from 21,22 and 33 carries 4 marks each
7. Questions from 23 to 26 and 34 carries 6 marks each.
8. There is no overall choice. However, an internal choice has been provided.

PART A
(Accounting for Partnership Firms and Companies)

1. Ram and Shyam are partners in the ratio of 3: 2. Before profit distribution, Ram is 1
entitled to 5% commission of the net profit (after charging such commission). Before
charging commission, firm's profit was Rs. 42,000. Shyam's share in profit will be:
(A) Rs.16,000 (B) Rs. 24,000
(C) Rs.26,000 (D) Rs.16,400

2. X and Y are partners. X draws a fixed amount at the beginning of every month
Interest on drawings is charged @8% p.a. At the end of the year interest on X's 1
drawings amounts to 2,600. Drawings of X were:-
(A) Rs.8,000 p.m. (B) Rs.7,000 p.m.
(C) Rs.6,000 p.m. (D) Rs.5,000 p.m.

3. Pick the odd one out:

(A) Rent to Partner. 1
(B) Manager's Commission.
(C) Interest on Partner's Loan.
(D) Interest on Partner's Capital.

4. E Ltd. had allotted 10,000 shares to the applicants of 14,000 shares on pro-rata basis,
application money on another 6,000 shares was refunded .The amount payable on
the application was Rs.2. Sitaraman applied for 420 shares. The number of shares 1
allotted to him will be:
(A) 60 Shares (B) 340 Shares
(C) 320 Shares (D) 300 Shares

OR
Which of the following is false with respect to debentures?
(A) They can be issued in lieu of dividends
(B) They can be issued for cash
(C) They can be issued for consideration other than cash
(D) They can be issued as collateral security

5. Read the following statements- Assertion (A) and Reason (R). Choose one of the 1
correct alternatives given below.
Assertion (A) :- Forfeiture of a share refers to the cancellation or termination of a
membership of a shareholder by taking away the shares and rights of
membership.
 Reason (R): Forfeited shares can be reissued at a discount.
Alternatives :-
(A) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct
explanation of Assertion.
(B) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct
explanation of Assertion (A).
(C) Assertion (A) is true but Reason (R) is False.
(D) Assertion (A) is False but Reason (R) is true.

6. 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

7. A, B and C are partners sharing profits in the ratio of 1/4 : 3/10 : 9/20. The New ratio 1
on the retirement of C will be:
(A) 6:5 (B) 5:6
(C) 4:3 (D) 4:10

8. At what rate is interest payable on the amount remaining unpaid to the executor of 1
deceased partner, in absence of any agreement among partner when he opts for
interest and not share of profit:
(A) 12% p.a. (B) 8% p.a.
(C) 6% p.a. (D) 7.5% p.a.

9. Secured Debentures is known as:- 1

(A) Mortgage debentures (B) Naked debentures
(C) Unsecured Debentures (D) None of the options

10. On dissolution of the firm, partner A demands that his loan of Rs.1,00,000 should be 1
paid before payment of Capitals of the partners, whereas partners B and C demand
that Capitals should be paid before the payment of A's loan. State the order of
payment.
(A) Partners B’s and C’s capital will be paid off first.
(B) Partner A’s loan will be paid off first.
(C) Only Partner B will get capital first.
(D) None of above

11. Read the following statements- Assertion (A) and Reason (R). Choose one of the 1
correct alternatives given below.
Assertion (A): Sarita Pvt. Ltd. issued 15% 10,000 debentures at par @ Rs. 100 per
debenture. The company suffered a loss but still the directors of the company paid
interest on debentures.
Reason (R): Interest on debenture is a charge against profits and therefore, its
payment is not subject to the earning of profit.
Alternatives :-
(A) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct
explanation of Assertion.
(B) Both Assertion (A) and Reason (R) are true and Reason (R) is not the correct
explanation of Assertion (A).
(C) Assertion (A) is true but Reason (R) is False.
(D) Assertion (A) is False but Reason (R) is true.
12. A company issued 4,000 equity shares of Rs.10 each at par payable as under: On 1
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

Read the following hypothetical situation, Answer the Question No. 13 to 15

Varun and Kuber are partners in a business. Balance in Capital and Current Accounts
on 31st March, 2019 were:
Capital Account Current Account
Varun Rs. 5,00,000 Rs. 80,000
Kuber Rs. 3,50,000 Rs. 20,000 (Dr.)

Profits of the last five consecutive years ending 31st March were: 2015 :- Rs. 60,000,
2016 :- Loss Rs. 40,000; 2017 :- Rs.1,30,000, 2018 :- Rs. 2,00,000 and 2019 :- Rs.
2,50,000.
General Reserve appeared in the books at Rs.50,000, the normal rate of return is 10%

13. What will be the value of capital employed ? 1

(A) Rs. 9,00,000 (B) Rs. 9,60,000
(C) Rs. 10,00,000 (D) Rs. 8,60,000

14. What will be the average profit of the past 5 years ? 1

(A) Rs. 1,20,000 (B) Rs. 1,36,000
(C) Rs. 12,00,000 (D) Rs. 8,60,000

15. Calculate the value of goodwill by the capitalisation of Average Profit Method. 1
(A) Rs. 1,20,000 (B) Rs. 1,36,000
(C) Rs. 3,00,000 (D) Rs. 2,40,000

16. Rajat, Mishi and Tanvi were partners in a firm sharing profits and losses in the ratio 1
of 5:3 :2. Tanvi died on 31st October, 2019. According to the partnership agreement,
her share of profits from the closure of last accounting year till the date of her death
was to be calculated on the basis of aggregate profits of two completed years before
death. Profits of the firm for the years ending 31st March, 2018 and 31st March,
2019 were Rs.57,000 and Rs.63,000 respectively. The firm closes its books on 31st
March every year. Tanvi's share of profits till the date of her death will be:
(A) Rs.24,000 (B) Rs.27,000
(C) Rs.14,000 (D) Rs.12,000

17. Green Ltd. purchased the assets of Strong Ltd. for Rs. 40,00,000 and took over 3
liabilities of Rs. 7,00,000 at an agreed value of Rs. 32,40,000. Payment was made by
issuing 10% Debentures of 100 each at a discount of 10%. Pass the necessary Journal
entries in the books of Green Ltd.
OR
X Ltd took a loan of Rs. 3,00,000 from IDBI Bank. The company issued 4,000 ; 9%
Debentures of Rs. 100 each as a collateral security for the same. Show how these
items will be presented in the Balance Sheet of the company

18. Calculate the value of goodwill on the basis of three year's purchase of the weighted 3
 average profits of the last five years. Profits to be weighted 1, 2, 3, 4 and 5, the
greatest weightage to be given to last year. Profits of the last five years were:

Year Ended (Rupees )

31st March 2015 Profit 80,000
31st March 2016 Profit 1,05,000 (after considering abnormal
loss of 41,500)
31st March 2017 Loss 20,000 (after considering abnormal
gain of Rs. 40,000)
31st March 2018 Profit 1,80,000
31st March 2019 Profit 2,00,000

Books of Accounts of the firm revealed that:-

(i) Closing Stock as on 31st March, 2015 was overvalued by Rs. 40,000.
(ii) Repairs to Machinery Rs.60,000 were wrongly debited to Machinery Account on
1st July, 2017. Depreciation was charged on Machinery @ 20% p.a. on diminishing
balance method.

19. Pass any three transaction of journal entries for the following information. 3
(i) Dissolution expenses amounted to Rs. 20,000. Rs. 8,000 were to be borne by the
firm and the balance by Maruti, a partner. The expenses were paid by Maruti.
(ii) Realisation expenses amounted to Rs. 8,000 wewre paid by partner X.
(iii) Anil, a partner, is to be paid remuneration of Rs. 20,000 for dissolution work.
Realisation expenses amounted to 7,500 were paid by the firm.
(iv) Sunil, a partner, is to be paid remuneration of Rs. 25,000 for dissolution work.
Realisation expenses amounted to Rs. 9,000 were paid by him.
(v) Realisation expenses amounted to Rs. 10,000 were paid by the firm on behalf of
a partner.

20. A, B and C were partners in a firm sharing profits and losses in the ratio of 2: 2: 1. 3
Their books are closed on March 31st every year.
B died on 1st August, 2019. The executors of B are entitled to:
(i) His share of Capital i.e., Rs. 4,00,000 along-with his share of goodwill. The total
goodwill of the firm was valued at 1.5 year's purchase of last year's profit.
(ii) His share of profit up to his date of death on the basis of sales till date of death.
Sales for the year ended March 31, 2019 was Rs. 4,00,000 and profit for the same
Year was Rs. 80,000. Sales shows a growth trend of 25% and percentage of profit
earning is increased by 4%.
(iii) Amount payable to B was transferred to his executors. Pass necessary Journal
Entries and show the workings clearly.

21. As a director of a company you had invited applications for 20,000 equity shares of 4
Rs.10 each at a premium of Rs.2 each. The total applications money received at
Rs.3/- per share was Rs.72,000. Name the kind of subscription. List the three
alternatives for allotting these share.

22. Charu, Dhwani, Iknoor and Paavni were partners in a firm. They had entered into 4
partnership firm last year only, through a verbal agreement. They contributed
Capitals in the firm and to meet other financial requirements, few partners also
provided loan to the firm. Within a year, their conflicts arisen due to certain due to
disagreements and they decided to dissolve the firm. The firm had appointed Ms.
Kavya, who is a financial advisor and legal consultant, to carry on the dissolution
process. In the first instance, Ms. Kavya had transferred various assets and external
liabilities to Realisation A/c. Due to her busy schedule; Ms. Kavya has delegated this
 assignment to you, being an intern in her firm. On the date of dissolution, you have
observed the following transactions:
(i) Dhwani's Loan of Rs.50,000 to the firm was settled by paying Rs. 42,000.
(ii) Paavni's Loan of Rs.40,000 was settled by giving an unrecorded asset of Rs.
45,000.
(iii ) Loan to Charu of Rs. 60,000 was settled by payment to Charu's brother loan of
the same amount.
(iv) Iknoor's Loan of Rs. 80,000 to the firm and she took over Machinery of 60,000
as part payment.
You are required to pass the journal entries for all the above mentioned transactions.

23. Khyati Ltd. issued a prospectus inviting applications for 80,000 equity shares of Rs.10 6
each payable as follows:
Rs. 2 on application
Rs.3 on allotment
Rs.2 on first call
Rs.3 on final call
Applications were received for 1,20,000 equity shares. It was decided to adjust the
excess amount received on account of over subscription till allotment only.
Hence allotment was made as under:
(i) To applicants for 20,000 shares - in full
(ii) To applicants for 40,000 shares- 10,000 shares
(iii) To applicants for 60,000 shares-50,000 shares
Allotment was made and all shareholders except Tammana, who had applied for
2,400 shares out of the group (iii), could not pay allotment money. Her shares were
forfeited immediately, after allotment. Another shareholder Chaya,who was allotted
500 shares out of group (ii), failed to pay first call. 50% of Tamanna's shares were
reissued to Satnaam as Rs. 7 paid up for payment of Rs. 9 per share.
Pass necessary journal entries in the books of Khyati Ltd. for the above transactions
by opening calls in arrears and calls in advance account wherever necessary.

OR
X Ltd. has offered 50000 equity shares of Rs. 100 each at a premium of Rs.20,
payable as follows:
Application Rs. 50 ; Allotment Rs. 40 (including premium) and balance on first and
final call. The bank account of the company has received Rs. 35, 00,000 on account of
share application money. X Ltd. decided to allot shares to all the applicants on Pro- rata
basis. The balance in calls in arrears account at the time of allotment and first and final
call amounted to Rs. 1,00,000 and Rs. 1,50,000 respectively. These shares were
forfeited and re-issued at Rs. 90 per share as fully paid up. Journalize.

24. Following is the balance sheet as at 31st March 2019 of A and B, who share profits 6
and losses in the ratio 3:2.
Liabilities Rs. Assets Rs.
Capital A/c Plant and machinery 1,00,000
A:- 1,00,000 Land and building 80,000
B :- 1,00,000 2,00,000 Debtors 1,20,000
General Reserve 1,50,000 (-) PBDD 10,000 1,10,000
Worksmen compensation Stock 1,20,000
reserve 50,000 cash 90,000
Creditors 1,00,000

5,00,000 5,00,000
 On 1st April 2019, the admit C into partnership on the following terms.
(i) Provision for Doubtful Debts would be increased by Rs.20,000.
(ii) Value of Land and Building would be increased to Rs. 1,80,000.
(iii) The value of Stock would be increased by Rs. 40,000.
(iv) The liability against the Workmen Compensation Reserve is determined at Rs.
20,000.
(v) C brought Rs. 1,00,000 in cash as his share of goodwill.
(vi) C would bring in further cash as would make his capital equal to 20% of the total
capital of the new firm after the above revaluation and adjustments are carried out.
Prepare Revaluation Account and Partners' Capital Accounts

OR
X,Y and Z partners in a firm sharing profits in the ratio 5:3: 2. On 31st March 2021,
the balance sheet was as follows

Liabilities Rs. Assets Rs.

Capital A/c Land and building 62,000
X:- 50,000 Motor Vans 20,000
Y :- 40,000 Investment 19,000
Z :- 20,000 1,10,000 Machinery 12,000
Investment Fluctuation Fund 10,000 Debtors 40,000
Profit & Loss 40,000 (-) PBDD 3,000 37,000
Creditors 21,000 Stock 15,000
cash 16,000

1,81,000 1,81,000

On the above date, Y retired and X and Z agreed to continue the business on the
following terms.
( i) Goodwill of the form was valued at Rs. 51,000
( ii) There was a claim of Rs. 4,000 for worksmen compensation.
(iii) Provision for bad debts was to be reduced by Rs. 1,000
(iv) Y will be paid Rs. 8,200 in cash and the balance will be transferred in his loan
account which will be paid in 4 equal yearly installment together with interest
@ 10% per annum.
The new profit sharing ratio between X and Z will be 3:2 and their capitals will be in
their new profit sharing ratio. The capital adjustments will be done by opening current
account.
Prepare Revaluation Account and Partners' Capital Accounts.

25. On 1st April, 2018, Relaxo Ltd. purchased assets of Rs. 4,30,000 and took over 6
liabilities of Rs. 90,000 of Greg Ltd. at an agreed value of Rs.3,80,000. It issued to the
vendor, 10% Debentures of Rs. 100 each at 5% discount, redeemable at par after 5
years, in full satisfaction of the purchase price.
On the same date, the company issued 500, 11% Debentures of Rs. 100 each as a
collateral security to a bank who had advanced a loan of Rs.45,000 to it for a period of
3 years and also issued 5,000, 12% Debentures of Rs.100 each at par, redeemable
after 3 years at 5% premium.
Additional Information:
The interest on debentures is paid half yearly on 30th September and 31st March each
year Tax deducted at source @ 20%. The Company had Rs. 1,20,000 in its Securities
Premium Reserve Account at the end of the year (Ignore interest on bank loan). You
 are required to pass Journal entries in the books of Relaxo Ltd. for the year ended.

26. Vikas , Gagan and Momita were partners in a firm sharing profits in the ratio of 6
2:2:1. The firm closes its books on 31st March every year. On 30th September, 2021
Momita died. According to the provision of partnership deed the legal representive of a
deceased partner are entitled for the following in the event of his/ her death.
( i) Capital as per last balance sheet.
( ii) Interest on capital at 6% per annum till the date of her death.
( iii) Her share of profit to be the date of death calculated on the basis of average profit
of last 4 last four years.
(iv) Her share of goodwill to be determined on the basis of 3 years purchase of
ge profit of last 4 years. The profit of last 4 years were :-

Years 2017-18 2018-19 2019-20 2020-21

Profit (Rs.) 30,000 50,000 40,000 60,000

The balance in Momita's capital account on 31st March 2021 was Rs. 60,000 and she
had withdraw Rs. 10,000 till date of her death. Interest on her drawings was Rs. 300
Prepare Momita's capital account to be presented to her executor.

PART B
Analysis of Financial Statement
27. Financial statements are prepared on certain basic assumptions (pre-requisites) known 1
as _____________________
(A) Provision of Companies Act, 2013
(B) Accounting Standards
(C) Postulates
(D) Basis of Accounting

28. Dividend paid by a Trading company is classified under which kind of activity while 1
preparing cash flow statement.
(A) Cash flow from operating activities
(B) Cash Equivalent
(C) Cash flow from Financing activities
(D) Cash flow from Investing activities
OR
Decrease in bank overdraft is classified under which kind of activity while
preparing cash flow statement.
(A) Cash flow from operating activities
(B) Cash Equivalent
(C) Cash flow from Financing activities
(D) Cash flow from Investing activities

29. Ratio of current assets (Rs. 10,00,000) to current liabilities (Rs. 4,00,000) is 2.5: 1. The 1
accountant is interested in maintaining a current ratio of 2: 1 by acquiring some
current assets on credit. How much current assets that should be acquired.
(A) Rs. 2,00,000 (B) Rs.2,50,000
(C) Rs.1,00,000 (D) Rs.50,000

OR
Calculate the Debt to Equity ratio from the following information.
Total Assets Rs. 1,25,000 ; Total Debts Rs. 1,00,000 ; Current liabilities Rs. 50,000
 (A) 1:2 (B) 4:1
(C) 2:1 (D) 2.5 : 1

30. While calculating the cash flow statement from investing activities following items 1
should be added except?
(A) Cash paid for purchase of Non-current Investment
(B) Interest received
(C) Cash received from sale of fixed assets
(D) Cash received from sale of investments

31. Give the Major heads and sub heads ( if any ) under which the following items are 3
shown in a company’s balance sheet as per Schedule III Part I of the Companies Act,
2013
(i) Mortgage Loan (ii) Patents
(iii) Investments (iv) General Reserve
(v) bills Receivable (vi) 10 % Debenture

32. Differentiate between current ratio and liquid ratio on the basis of meaning, assessment 3
and ideal ratio.

33. (A) Calculate current asset , liquid assets ,opening inventory, closing inventory of a 4
company from the following information.
(i) Inventory turnover ratio : 4 times
(ii) Inventory at the end is Rs. 20,000 more than inventory in the beginning.
(iii) Revenue from operation Rs. 3,00,000
(iv) Gross profit Ratio 25%
(v) Current liabilities Rs. 40,000
( vi ) Quick ratio 0.75
OR
The gross profit ratio of a company is 25 % . State giving reason, which of the
following transaction will (a) increase (b) decrease (c) not change the gross profit
ratio
(i) purchase of stock in trade Rs. 50,000
(ii) Purchase return Rs. 15,000
(iii) Stock in trade costing Rs. 20,000 withdraw for personal use.
(iv) Stock in trade costing Rs. 10,000 distributed as free samples.

34. Prepare cash flow statement as per AS-3 ( Revised) for te year ended 31 st March 2019 6
from the following balance sheet as at 31st March 2019.

Super India Ltd.

Balance Sheet as at 31st March 2019

Particulars Note 31stMarch 31stMarch

NO. 2020(Rs) 2019(Rs)
I. Equity and liabilities
1. Share holders’ fund
(a) Equity Share Capital 6,00,000 6,00,000
(b) Reserve and Surplus 1 4,50,000 4,20,000
2. Non Current Liabilities
Long Term Borrowings 2 1,50,000 ---------
3. Current Liabilities
(a) Trade Payable 60,000 40,000
 (b) Short Term Provision 3 45,000 50,000

Total 13,75,000 12,40,000

II. Assets:
1. Non current Assets
(a) Fixed Assets 3,20,000 4,00,000
(b) Non Current Investment 60,000 50,000
2. Current Assets
(a) Current Investment 17,000 20,000
(b) Inventories 2,10,000 2,40,000
(c) Trade Receivable 5,88,000 4,00,000
(d) Cash and cash Equivalent 1,80,000 1,30,000

Total 13,75,000 12,40,000

Note to Accounts:-
Particulars 31stMarch 31stMarch
2020(Rs) 2019 (Rs)
1. Reserve and Surplus
General Reserve 4,00,000 3,50,000
Surplus 50,000 70,000
2. Long- term Borrowings
Mortgage Loan 1,50,000 ---------
3. Short Term Provision
Provision For Taxation 45,000 50,000

Additional Information :-
(i) Non - Current Investments costing Rs.20,000 were sold during the year 2019-20 at a
profit of @ 20 %
(ii) Tax paid during the year was Rs. 62,000.
(iii) During the year, part of fixed asset costing Rs. 40,000 was sold for Rs. 50,000 and
the profit was included in the statement of profit and Loss.
(iv) An Interim Dividend @ 12% was paid during the year.