Sample Paper-1

Answer
1. (b) ` 6,000 Hint:
Dr.  P & L Appropriation AccountCr.
Hint:
Particulars Amt. (`) Particulars Amt. (`)
Particulars L.F. Amt. (`) Amt. (`)
To Manager’s 3,100 By P & L A/c 62,000
Milan’s Capital A/c (15,000 × 2/5) Dr. 6,000 Commission (2)
 5 
Khilan’s Capital A/c (15,000 × 2/5) Dr. 6,000  62,000 × 
 100 
Silam’s Capital A/c (15,000 × 1/5) Dr. 3,000
To Profit 58,900
To Profit and Loss A/c 15,000 62,000 62,000
To Interest on Capital By Net Profit 71,400
2. (d) No interest on capital will be allowed
Richa 15,000 (Before
Hint: When a partnership firm incurrs loss, there will Anmol 9,000 Anmol’s
be no profit for appropriation. Hence, no interest on Salary)
capital will be allowed. To Anmol’s Salary 12,500
To Profit transfer to
3. (c) (ii), (i), (iii), (iv)
Richa’s Capital A/c (1) 20,940
Hint: Correct sequence of events is: Anmol’s Capital A/c 13,960
(i) Default on calls 71,400 71,400
(ii) Forfeiture of shares 12. (b) Second and Final Call ` 4
(iii) Reissue of shares Hint: [(10 + 4) - 3 - 5 - 2] = [14 - 10] = ` 4
(iv) Amount transferred to capital reserve   Or
Or (a) ` 38,000

(a) profit and loss  95 
Hint: (50,000 − 10,000) ×  = ` 38,000
4. (c) No Entry  100 
5. (b) Profit and Loss Suspense A/c Dr.   9,375
13. (b) Both Assertion (A) and Reason (R) are true,
To Kavleen’s Capital A/c 9,375 but Reason (R) is not the correct explanation of
6. (a) Amar’s and Samar’s capital accounts will be Assertion (A).
debited by ` 10,000 and ` 50,000 respectively and 14. (b) credited by ` 150
profit and loss account will be credited by ` 60,000. Hint:
Hint: Debit balance of profit and loss account shows Particulars Krishna Sandeep Karim Total
loss which is debited in partner’s capital accounts. (`) (`) (`) (`)
Amount has been credited @ 1% 1,200 900 600 2,700
Or
Amount has to be credited 1,350 900 450 2,700
(b) ` 37,950 (3 : 2 : 1)
150 (Cr.) Nil 150 (Dr.) Nil
Hint: Goodwill
(-14,500 + 15,400 + 32,900 + 16,800) 15. (a) ` 5,250; ` 3,150; ` 2,100
      = ×3
4 Hint: The appearance of investment fluctuation
fund at ` 13,500 indicates that the market value
50,600 × 3 = ` 37,950
     = of investments at the time of creation of fund was
4
` 1,36,500 (1,50,000 - 13,500). The market value is
7. (d) Statement I is incorrect and statement II is
now ` 1,47,000. So, IFF will be shown in the books at
correct.
` 3,000 and ` 10,500 will be distributed among old
8. (d) ` 4,950
partners in the old ratio of 5 : 3 : 2.
Hint: Application(5), Allotment(7), Final Call(8)
16. (d) ` 8,750
250 Shares —    × 1,750   × 2,000
Hint: Average Profit
150 Shares —    —    × 1,200
(1, 20,000 − 50, 000 + 1, 70,000)
       1,750   + 3,200 = ` 4,950 = − 10,000 = ` 70,000
3
9. (d) ` 20,940
3 5
10. (c) ` 71,400 Khushi’s Profit = 70,000 × ×
12 10
11. (c) Only (iii)
     = ` 8,750
2 |
17. (a) 
Calculation of new capitals of the existing 18. Journal Entries
partners:
Date Particulars L.F. Amt. (`) Amt. (`)
Balance in Asha’s Capital (`)
(after all adjustments)  = 1,60,000 2017
(+) Balance in Lata’s Capital  = 80,000 Apr. 01 Bank A/c Dr. 8,50,000
To Raghav’s Capital A/c 6,00,000
Total Capital of the New Firm  = 2,40,000
To Premium for Goodwill A/c 2,50,000
Based on the new profit sharing ratio of 3 : 1. (Being capital and premium
3 brought in by Raghav)
Asha’s new capital = 2,40,000 × = ` 1,80,000
4 Apr. 01 Premium for Goodwill A/c Dr. 2,50,000
1 To Asha’s Capital A/c 1,50,000
Lata’s new capital = 2,40,000 × = ` 60,000 (2,50,000 × 3/5)
4
To Aditi’s Capital A/c 1,00,000
Note: The total capital of the new firm is based
(2,50,000 × 2/5)
(Being premium for
on the sum of the balance in the capital accounts
goodwill credited to the
of the continuing partners. capital accounts of Asha
(b) C
 alculation of cash to be brought in or withdrawn and Aditi in the sacrificing
by the continuing partners: ratio)

Particulars Asha (`) Lata (`) Working Note:

New Capitals 1,80,000 60,000 Calculation of Goodwill:
Existing Capitals 1,60,000 80,000 Adjusted Profit:
Cash to be brought in on (paid off) 20,000 (20,000) 2013-14 = ` 3,50,000 - ` 56,250 = `   2,93,750
2014-15 = ` 4,75,000 - ` 56,250
= ` 4,18,750
In the Books of Asha and Lata
2015-16 =
` 6,70,000 - ` 56,250 = ` 6,13,750
Journal Entries
2016-17 =
` 7,45,000 - ` 56,250 - ` 15,000
Date Particulars L.F. Amt. (`) Amt. (`)
= ` 6,73,750
Bank A/c Dr. 20,000
Total Profit 20,00,000
To Asha’s Capital A/c 20,000
(Being cash brought by Asha) Average Profit = 20,00,000 × 1/4 = ` 5,00,000
Goodwill = Average Profit × Number of Years’ Purchase
Lata’s Capital A/c Dr. 20,000
 o Bank A/c
T 20,000
= 5,00,000 × 2 = ` 10,00,000
(Being surplus capital Raghav’s Share of Goodwill = ` 10,00,000 × 1/4
withdrawn by Lata)
= ` 2,50,000
19.
Dr. Realisation Account Cr.
Particulars Amt. (`) Particulars Amt. (`)

To Sundry Assets A/c: By Sundry Liabilities:

Land and Building 6,00,000 Sundry Creditors 2,10,000

Stock 2,00,000 Provision for Bad Debts 10,000

Debtors 3,10,000 11,10,000 Employees’ Provident Fund 2,00,000 4,20,000

To Bank A/c: By Bank A/c:

Creditors 1,05,000 Land and Building 7,00,000

Employees’ Provident Fund 2,00,000 3,05,000 Stock 90,000

To Sona’s Capital A/c 20,000 Debtors 2,48,000 10,38,000

To Profit Transferred to:

Mona’s Capital A/c 9,200

Sona’s Capital A/c 13,800 23,000

14,58,000 14,58,000
 Accountancy  |  Class 12 | 3
Journal Entry Notes to Accounts
Particulars Details Amt. (`)
Date Particulars L.F. Amt. (`) Amt. (`)
1. Share Capital:
P’s Capital A/c Dr. 11,648
R’s Capital A/c Dr. 96 Authorised Capital:
To Q’s Capital A/c 11,744
2,00,000 Equity Shares of ` 10 each 20,00,000
(Being entry passed for
adjustment of interest on Issued Capital:
capital and salary) 80,000 Equity Shares of ` 10 each 8,00,000

  Working Notes: Subscribed Capital:

Interest    Subscribed and Fully Paid:

Salary
on 74,000 shares of ` 10 each 7,40,000
Paid Salary
Capital Payable Excess/
Partners (wrong Payable    Subscribed but not Fully Paid:
Paid (ii) Deficiency
credit) (iv)
(2%) 4,000 Equity Shares of ` 10 each 40,000
(iii)
(i)   Less: Calls-in-arrears (4,000 × 2) (8,000) 32,000
11,648
P 800 1,152 12,000 ………    Add: Forfeited Shares
(Excess)
11,744   2,000 Equity Shares of ` 3 6,000
Q 640 384 ……… 12,000
(Deficiency) 7,78,000
96
R 480 384 ……… ………
(Excess) 23.
21.        Journal Entries Dr. Revaluation Account  Cr.
Date Particulars L.F. Amt. (`) Amt. (`) Amt. Amt.
Particulars Particulars
P&L Adjustment A/c Dr. 9,000 (`) (`)
To Cheese’s Capital A/c 3,000 To Furniture A/c 11,000 By Debtors A/c 5,000
To Slice’s Capital A/c 6,000 (1,10,000 × 10%) By Land and Building A/c 62,000
(Being interest on capital
(3,10,000 × 20%)
omitted earlier now provided)
To Provision for Doubtful
P&L Adjustment A/c Dr. 5,000
Debts on Debtors A/c 4,000
To Cheese’s Capital A/c 5,000
(Being salary omitted earlier (75,000 + 5,000 =
now provided) 80,000 × 5%)
Cheese’s Capital A/c Dr. 7,000 To Provision for
Slice’s Capital A/c Dr. 7,000 Doubtful Debts on
To P&L Adjustment A/c 14,000 B/R A/c 2,250
(Being loss on adjustment (45,000 × 5%)
transferred to partners)
To Claim for Damages A/c 8,000
22. Balance Sheet (Extract)
To Profit Transferred to
     as at ……………… Partner’s Capital A/c’s:
Note Amt. (`) Chander 20,875
Particulars
No. Current Year
  Damini 20,875 41,750
I. EQUITY AND LIABILITIES
67,000 67,000
1. Shareholder’s Funds:
(a) Share Capital 1 7,78,000

Dr. Partners’ Capital Account Cr.

Particulars Chander (`) Damini (`) Elina (`) Particulars Chander (`) Damini (`) Elina (`)
To Bank A/c 12,500 12,500 — By Balance b/d 2,50,000 2,16,000 —
To Balance c/d 2,83,375 2,49,375 3,00,000 By Bank A/c — — 3,00,000
By Premium for Goodwill A/c 25,000 25,000 —
By Revaluation A/c 20,875 20,875 —
2,95,875 2,61,875 3,00,000 2,95,875 2,61,875 3,00,000

  Working Notes: 1
Chander = 50,000 × = ` 25,000
P remium for Goodwill: Premium for goodwill
1.  2
` 50,000 to be credited to Chander and Damini 1
Damini = 50,000 × = ` 25,000
in 1 : 1. 2
4 |
2. Provision for Doubtful Debts: 3. (i) Bank A/c Dr.  3,50,000
Sundry Debtors = 75,000 To Elina’s Capital A/c  3,00,000
To Premium for Goodwill A/c 50,000
(+) Unrecorded Debtors = 5,000 (ii) Premium for Goodwill A/c Dr. 50,000
80,000
= To Chander’s Capital A/c 25,000
5     To Damini’s Capital A/c 25,000
= 80,000 × (iii) Chander’s Capital A/c Dr. 12,500
100
Damini’s Capital A/c Dr. 12,500
` 4,000
=
To Bank A/c 25,000
Or
Dr.    
Revaluation Account  Cr.
Particulars Amt. (`) Particulars Amt. (`)
To Provision for Doubtful Debts A/c 7,000 By Plant and Machinery A/c 20,000
To Furniture A/c 3,000
To Profit Transferred to:
Akul’s Capital A/c 4,000
Bakul’s Capital A/c 4,000
Chandan’s Capital A/c 2,000 10,000
20,000 20,000

Dr. Partners’ Capital Account Cr.

Particulars Akul (`) Bakul (`) Chandan (`) Particulars Akul (`) Bakul (`) Chandan (`)
To Bakul’s Capital A/c 80,000 — 40,000 By Balance b/d 1,60,000 1,20,000 92,000
To Bakul’s Loan A/c — 2,52,000 — By General Reserve A/c 8,000 8,000 4,000
To Bank A/c — — 8,000 By Revaluation A/c 4,000 4,000 2,000
To Balance c/d 1,00,000 — 50,000 By Akul’s Capital A/c — 80,000 —
By Chandan’s Capital A/c — 40,000 —
By Bank A/c 8,000 — —
1,80,000 2,52,000 98,000 1,80,000 2,52,000 98,000

Balance Sheet New Capitals of Akul and Chandan:

as at 31st March, 2018
2
Liabilities Amt. (`) Assets Amt. (`) Akul = 1,50,000 × = ` 1,00,000
3
Sundry Creditors 45,000 Cash at Bank 42,000
Employees Provident Debtors 60,000 1
Chandan = 1,50,000 × = ` 50,000
Fund 13,000 3
Bakul’s Loan 2,52,000 (-) Provision for 24. Journal Entries
Doubtful
Date Particulars Amt. (`) Amt. (`)
Capitals: Debts (9,000) 51,000
Bank A/c (8,00,000 × 1) Dr. 8,00,000
Akul 1,00,000 Stock 80,000 To Equity Share Application A/c 8,00,000
Chandan 50,000 1,50,000 Furniture 87,000 (Being application money received)
Plant and Machinery 2,00,000 Equity Share Application A/c Dr. 8,00,000
4,60,000 4,60,000 To Equity Share Capital A/c 5,00,000
(5,00,000 × 1)
Working Notes: To Equity Share Allotment A/c 2,00,000
2 (2,00,000 × 1)
  1. Bakul’s share of goodwill = 3, 00, 000 × = ` 1, 20, 000
5 To Bank A/c (1,00,000 × 1) 1,00,000
(Being application money
to be contributed by Akul and Chandan in gaining
transferred to share capital
ratio 2 : 1.
account and excess money
2 adjusted towards allotment and
Akul = 1, 20,000 × = ` 80,000
3 returned)

1 Equity Share Allotment A/c Dr. 10,00,000

Chandan = 1, 20,000 × = ` 40,000 (5,00,000 × 2)
3
To Equity Share Capital A/c 10,00,000
2. Capital Adjustment: (`) (Being allotment money due)
Akul’s Capital (after adjustment) = 92,000 Bank A/c (W.N.2) Dr. 7,92,000
Chandan’s Capital (after adjustment) = 58,000 To Equity Share Allotment A/c 7,92,000
 1,50,000 (Being allotment money received)
 Accountancy  |  Class 12 | 5
Equity Share First Call A/c Dr. 15,00,000 3. Capital Reserve = Ashok = ` 7,000
(5,00,000 × 3)
15,000 9,000
To Equity Share Capital A/c 15,00,000 Mohan = × 3,000 =
5,000 16,000
(Being first call money due)
Or
Bank A/c Dr. 14,70,000
(15,00,000 - 15,000 - 15,000) In the Books of Ajanta Ltd.
To Equity Share First Call A/c 14,70,000 Journal Entries
(Being first call money received)
Date Particulars Amt. (`) Amt. (`)
Equity Share Second and Final Call
Bank A/c Dr. 18,00,000
A/c (5,00,000 × 4) Dr. 20,00,000
To Equity Share Capital A/c 20,00,000 To Equity Share Application
(Being second and first call money     A/c 18,00,000
due) (Being share application
Bank A/c Dr. 19,60,000 money received)
To Equity Share Second and Equity Share Application A/c Dr. 18,00,000
Final Call A/c 19,60,000
To Equity Share Capital A/c 15,00,000
(Being second and final call money
received) To Equity Share Allotment
   A/c 3,00,000
Equity Share Capital A/c Dr. 1,00,000
  (10, 000 × 10) (Being share application
To Shares Forfeiture A/c 22,000 money transferred to share
capital A/c and excess money
To Equity Share Allotment A/c 8,000
adjusted in share allotment
To Equity Share First Call A/c 30,000
and refunded)
To Equity Share Second and
Final Call A/c 40,000 Equity Share Allotment A/c Dr. 25,00,000
(Being shares of Ashok and Mohan To Equity Share Capital A/c 20,00,000
for non-payment of money)
To Securities Premium A/c 5,00,000
Bank A/c (8,000 × 12) Dr. 96,000
(Being share allotment money
To Equity Share Capital
due)
   A/c (8,000 × 10) 80,000
To Securities Premium Reserve Bank A/c Dr. 21,95,600
A/c (8,000 × 2) 16,000 Calls-in-arrears A/c Dr. 4,400
(Being 8,000 shares re-issued
To Equity Share Allotment
@ ` 12 per share fully paid)
   A/c 22,00,000
Shares Forfeiture A/c Dr. 16,000
(Being share allotment money
To Capital Reserve A/c 16,000
received)
(Being amount of share forfeiture
transferred to capital reserve Equity Share First and
account) Final Call A/c Dr. 15,00,000
To Equity Share Capital A/c 15,00,000
Working Notes:
(Being share first and final call
1. Number of shares applied by Ashok
due)
 7
 =  5,000 ×  = 7,000 Bank A/c Dr. 14,97,000
 5
Calls-in-arrears A/c Dr. 3,000
Application money received (7,000 × 1) =   ` 7,000
To Equity Share First and
(-) Application money due Excess
   Final call A/c 15,00,000
(5,000 × 1) = ` (5,000)
(Being share first and final call
 ` 2,000 money received)
(Allotment money due) (Arrears at allotment)  Equity Share Capital A/c Dr. 10,000
                              (5,000 × 2) = ` (10,000)
Securities Premium A/c Dr. 1,000
Calls-in-arrears ` (8,000)
To Equity Share Forfeiture
2. Allotment due                      = ` 10,00,000    A/c 3,600
(—) Received with application          =  ` 2,00,000 To Calls-in-arrears A/c 7,400
                                   = ` 8,00,000 (Being shares forfeited for
(—) Calls-is-arrears at allotment      =  ` (8,000) non-payment of first and final
Allotment money received = ` 7,92,000 call)
6 |
Working Notes: (i) Gurnam Ltd. Dr. 12,60,000
          Sumit holds shares = 1,000 To 10% Debentures A/c 12,60,000
6,00,000
No. of shares applied by Sumit = × 1,000 (Being 12,600, 10%
5,00,000 debentures issued for
                     = 1,200 purchase consideration)
Amount due on 1000 shares on allotment = ` 5,000 (ii) Gurnam Ltd. Dr. 12,60,000
Less: Advance received in 200 shares To 10% Debentures A/c 10,08,000
   (200 × 3) = ` 600 To Securities Premium A/c 2,52,000
Amount to be received on allotment = ` 4,400 (Being 10,080 debentures
25. In the Books of Satnam Ltd. issue at premium for purchase
Journal Entries consideration)

Date Particulars L.F. Amt. (`) Amt. (`) (iii) Gurnam Ltd. Dr. 12,60,000
Discount on Issue of
Building A/c Dr. 5,00,000 Debentures A/c Dr. 1,40,000
Plant A/c Dr. 4,60,000
To 10% Debentures A/c 14,00,000
Furniture A/c Dr. 2,20,000
(Being 14,000 debentures
Goodwill A/c Dr. 80,000
issued at discount for purchase
To Gurnam Ltd. 12,60,000
(Being business purchased) consideration)

26.
Dr. Realisation Account Cr.
Particulars Amt. (`) Particulars Amt. (`)
To Stock A/c 25,000 By Creditors A/c 35,000
To Debtors A/c 20,000 By Provision for Bad Debts A/c 2,000
To Furniture A/c 15,000 By Bank A/c:
To Land and Building A/c 80,000 Land and Building 85,000
To Monu’s Capital A/c (Realisation expenses) 2,000 Debtors 20,000
To Bank A/c (Creditors) 34,300 Furniture 6,000 1,11,000
By Sonu’s Capital A/c (Stock) 25,000
By Ashu’s Capital A/c (Unrecorded assets) 3,000
By Loss on Realisation Transferred to Capital A/c’s:
Sonu 150
Monu 90
Ashu 60 300
1,76,300 1,76,300

Dr. Partners’ Capital Account Cr.

Particulars Sonu (`) Monu (`) Ashu (`) Particulars Sonu (`) Monu (`) Ashu (`)

To Realisation A/c 25,000 — 3,000 By Balance b/d 50,000 30,000 20,000

To Realisation A/c (Loss) 150 90 60 By General Reserve 12,500 7,500 5,000

To Bank A/c 37,350 39,410 21,940 By Realisation A/c — 2,000 —

62,500 39,500 25,000 62,500 39,500 25,000

Dr. Bank Account Cr. Note: Though, in question, students are asked to prepare
only realisation account, we have given partners’
Particulars Amt. (`) Particulars Amt. (`)
capital accounts and bank account as well for better
To Balance b/d 22,000 By Realisation A/c 34,300
practice.
To Realisation A/c 1,11,000 By Capital A/c’s: 27. (a) ` 1,20,000
Sonu 37,350 Cost of Goods Sold
Hint: Stock Turnover Ratio =
Monu 39,410 Average Inventory
Ashu 21,940 98,700 COGS
6 =
1,33,000 1,33,000
80,000
COGS = ` 4,80,000
 Accountancy  |  Class 12 | 7
Selling Price = 25% of COGS (iii) Provision for Non-current Long-term
25 25 Retirement Liabilities Provisions
\ Gross Profit = COGS × ⇒ 4,80,000 ×
100 100 Benefits
⇒ ` 1,20,000 (iv) Prepaid Current Assets Other Current
28. (a) No effect Insurance Assets
29. (d) All of the above (v) Capital Advances Non-current Long-term
Or Assets Loans and
Advances
(c) Statement I is correct and statement II is incorrect.
30. (a) 25% (vi) Shares in Listed Non-current Non-current
Companies Assets Investments
32.
33.    Cash Flows from Investing Activities
S.No. Items Major Heads Sub-heads
Particulars Amt. (`)
(i) Loose Tools Current Assets Inventories
Sale of Machinery 13,000
(ii) Loan Repayable Current Short-term
Purchase of Machinery (35,000)
on Demand Liabilities Borrowings
Net Cash used in Investing Activities (22,000)

  Working Notes:
1.
Dr. Machinery Account Cr.
Particulars Amt. (`) Particulars Amt. (`)
To Balance b/d 50,000 By Cash A/c (proceeds from sale of machine) 13,000
To Statement of Profit and Loss (profit on sale of machine) 3,000 By Accumulated Depreciation A/c 15,000
To Cash A/c (balancing figure: new machinery purchased) 35,000 By Balance c/d 60,000
88,000 88,000

2.
Dr. Accumulated Depreciation Account Cr.
Particulars Amt. (`) Particulars Amt. (`)

To Machinery A/c 15,000 By Balance b/d 25,000

To Balance c/d 15,000 By Statement of Profit and Loss 5,000
(Depreciation provided during the year)
30,000 30,000

34. Cash Flow Statement

for the year ended 31st March, 2017
Particulars Amt. (`) Amt. (`)
A. Cash Flow from Operating Activities:
Net Profit before Tax and Extraordinary Items (WN) 3,25,000
(+) Non-cash and Non-operating Charges
Depreciation on Machinery 62,500
Interest on Debentures 15,000 77,500
 perating Profit before Working
O
Capital Changes 4,02,500
(-) Increase in Current Assets
Increase in Trade Receivables (50,000)
Cash Generated from Operations 3,52,000
(-) Tax Paid (75,000)
Net Cash Flow from Operating Activities (A) 2,77,500
B. Cash Flow from Investing Activities:
Purchase of Machinery (2,12,500)
Loans and Advances given (1,00,000)
Net Cash Used in Investing Activities (B) (3,12,500)
8 |
C. Cash Flow from Financing Activities:
Issue of Debentures 1,00,000
Interest Paid on Debentures (15,000)
Dividend paid (50,000)
Bank overdraft raised 50,000
Net Cash Flow from Financing Activities (C) 85,000
Net Increase in Cash and Cash Equivalents (A + B + C) 50,000
(+) Opening Balance of Cash and Cash Equivalents 75,000
Closing Balance of Cash and Cash Equivalents 1,25,000

Working Notes:
Calculation of Net Profit before Tax:            (`)
Net Profit for the Year (1,00,000 + 25,000) 1,25,000
(+) Proposed Dividend 75,000
(+) Provision for Tax 1,25,000
3,25,000

Sample Paper-2
Answer
1. (d) relationship 9. (c) Issue for Consideration other than Cash
2. (d) deferred revenue reserve 10. (c) ` 1,49,900
3. (d) Assertion (A) is false, but Reason (R) is true. (`)
Hint: Share Subscribed  = 50,000
Or
      1,00,000
(a) of goodwill ` 47,200  1,50,000
Hint: (`)        (100)
Purchase Consideration = 3,07,200  1,49,900
(+) Creditors = 1,00,000 (-) Calls-in-arrears (100 × 3)   = (300)
4,07,200 (+) Share Forfeited Account (100 × 3)    = 300
(-) Sundry Assets = (3,60,000)   1,49,900
Goodwill = 47,200 11. (c) ` 200
Hint: Securities premium reflected in the balance
4. (a) Both statements are correct.
sheet at the end of the year will be ` 200
5. (d) ` 45,000 and ` 15,000 respectively
(50 × 4).
Hint: Sacrificing Ratio = Old Share - New Share
12. (c) Investment A/c Dr.
5 3 15 − 12 3 To Revaluation A/c
Kalki = − = =
8 6 24 24
Or
3 2 9−8 1
Kumud = − = = (c) ` 12,40,000
8 6 24 24
Hint: Money received for ` 1,46,000
Sacrificing Ratio = 3 : 1
On Application (1,46000 × 8)  = ` 11,68,000
Kaushtubh’s Current A/c Dr. 60,000
(3,60,000 × 1/6) Total Money received with 4,000 Shares
To Kalki’s Capital A/c  45,000        (4,000 × 18) =  ` 72,000
(60,000 × 3/4) Total Money received on Share
To Kumud’s Capital A/c  15,000 Application ` 12,40,000
(60,000 × 1/4) 13. (b) ` 4,500; ` 9,000 and ` 9,000
6. (d) ` 17,500 Hint:
 7 6
Hint: Interest = (5,000 × 100) × ×  = 17,500 Particulars L.F. Amt. (`) Amt. (`)
 100 12 
Red’s Capital A/c (22,500 × 1/5) Dr. 4,500
Or
Blue’s Capital A/c (22,500 × 2/5) Dr. 9,000
(c) 37
7. (c) Statement I is correct and statement II is incorrect. White’s Capital A/c (22,500 × 2/5) Dr. 9,000

8. (c) Loss ` 28,000 To Deferred Revenue Expenditure A/c 22,500

 Accountancy  |  Class 12 | 9
14. (b) Both Assertion (A) and Reason (R) are true, but 19. In the Books of Venus Ltd.
Reason (R) is not the correct explanation of Journal Entries
Assertion (A).
Date Particulars L.F. Amt. (`) Amt. (`)
15. (c) debit debenture suspense A/c ` 1,00,000 and
credit debenture A/c ` 1,00,000. Assets A/c Dr. 10,00,000
16. (c) The balance of share forfeiture account is To Liabilities A/c 1,80,000
To Cayns Ltd. 7,60,000
transferred to capital reserve account. To Capital Reserve A/c 60,000
17. Journal Entry (Being business purchased of
Date Particulars L.F. Amt. (`) Amt. (`) Cayns Ltd.)
2017 Cayns Ltd. Dr. 7,60,000
April 1 Rajeev’s Capital A/c Dr. 2,760 Discount on Issue of
To Sanjeev’s Current A/c 2,760 Debentures A/c (8,000 × 5) Dr. 40,000
(Being an adjustment entry To 9% Debentures A/c 8,00,000
passed for interest on capital (8,000 × 100)
omitted previously) (Being 9% debentures
Adjustment Table issued at 5% discount to
Cayns Ltd.)
Rajeev Sanjeev Total
Particulars
(`) (`) (`)
Working Note:
A. Amount already recorded:
7,60,000
Share of Profit: Number of debentures issued = = 8,000
First ` 20,000 to Rajeev 20,000 — 20,000 (100 − 5)
Balance [(60,000 – 20,000) 32,000 8,000 40,000 Or
` 40,000 in 4 : 1)]
Journal Entries
52,000 8,000 60,000
Date Particulars L.F. Amt. (`) Amt. (`)
B. Amount which should have
(i) Interest on C’s Capital A/c Dr. 72,000
been recorded:
To C’s Capital A/c 72,000
Interest on Capital @ 6% p.a. 5,400 4,800 10,200
(Being interest on C’s Capital
Share of Revised Profit:
Account charged)
First ` 20,000 to Rajeev 20,000 — 20,000
Balance [(49,800 - 20,000) P&L Appropriation A/c Dr. 72,000
` 29,800 in 4 : 1)] 23,840 5,960 29,800 To Interest on C’s Capital A/c 72,000
49,240 10,760 60,000 (Being interest on C’s
capital transferred to P & L
Net Effect (A - B) 2,760 2,760 Nil appropriation account)
(Dr.) (Cr.)
(ii) Interest on A’s Loan A/c Dr. 3,500
Working Notes: To Bank A/c 3,500
1. Interest on Capital: (Being interest on A’s loan paid)
Rajeev = 90,000 × 6/100 = ` 5,400 Profit and Loss A/c Dr. 3,500
Sanjeev = 80,000 × 6/100 = ` 4,800 To Interest on A’s Loan A/c 3,500
2. Revised Profit = Profit - Interest on Capital (Being interest on A’s loan
   = 60,000 - (5,400 + 4,800) = ` 49,800 transferred to P&L account)
18. Balance Sheet of NK Ltd. (iii) B’s Capital A/c Dr. 1,200
as at ……………… (As per revised Schedule III) To Interest on B’s Drawings 1,200
    A/c
Amt. (`) (Being entry for interest on B’s
Particulars Note No.
Current Year drawings passed)
I. EQUITY AND LIABILITIES Interest on B’s Drawings A/c Dr. 1,200
1. Shareholder’s Funds: To Profit & Loss Appropriation 1,200
(a) Share Capital 1 70,00,000 A/c
(Being interest on B’s
Notes to Accounts: drawings transferred to P&L
Particulars Amt. (`) appropriation account)
1. Share Capital   Working Notes:
Authorised Capital:
10 6
1,00,000 equity shares of ` 100 each 1,00,00,000 (i) Interest on A’s Loan = 70,000 × ×
100 12
Issued Capital:
= ` 3,500
70,000 equity shares of ` 100 each 70,00,000
12 6
Subscribed Capital: (ii) Interest on B’s Drawings = 20,000 × ×
Subscribed and fully paid 100 12
70,000 shares of ` 100 each 70,00,000 = ` 1,200
10 |
20.      Journal Entries 1
22. Capital of Ira for Share = ` 40,000
4
Date Particulars L.F. Amt. (`) Amt. (`)
Total Capital of the Firm = 40,000 × 4 = ` 1,60,000
2021
New Profit Sharing Ratio
Mar. 31
1
(i) Bank A/c Dr. 42,000    Ira’s Share =
4
To Realisation A/c 42,000 1 3
       Remaining = 1 − =
(Being fully written-off 4 4
machine sold) 3 3 9
  Atul’s New Share = × =
Bills Receivable A/c Dr. 6,000 4 5 20
To Bank A/c 6,000 3 2 6
Geeta’s New Share = × =
(Being bills receivable 4 5 20
dishonoured) 1 5 5
       Ira’s Share = × =
(ii) Madhusudan’s Loan A/c Dr. 1,00,000 4 5 20
To Realisation A/c 75,000        New Shares = 9 : 6 : 5
To Bank A/c 25,000 9
      Atul’s Capital = 1,60,000 × = ` 72,000
(Being unrecorded asset 20
taken by Madhusudan) 6
    Geeta’s Capital = 1,60,000 × = ` 48,000
(iii) Madhav’s Capital A/c Dr. 10,000 20
Madhusudan’s Capital A/c Dr. 10,000 5
      Ira’s Capital = 1,60,000 × = ` 40,000
Mukund’s Capital A/c Dr. 10,000 20
To Stock A/c 30,000 Atul’s Capital = ` 72,000
(Being stock taken by Less: Adjusted = ` 60,000
partners)
Cash to be brought = ` 12,000
(iv) Mukund’s Capital A/c Dr. 5,000
Geeta’s Capital = ` 48,000
To Bank A/c 5,000
Less: Adjusted Capital = ` 40,000
(Being realisation expenses
paid by the firm and borne by Cash to be brought = ` 8,000
Mukund) Journal Entry
(v) Vehicle’s Loan A/c Dr. 60,000
Amt. Amt.
To Bank A/c 60,000 Date Particulars L.F.
(`) (`)
(Being remaining amount of Cash A/c Dr. 20,000
vehicle loan paid) 12,000
To Atul’s Capital A/c
To Geeta’s Capital A/c 8,000
21. Journal Entry (Being deficiency of capital
Date Particulars L.F. Amt. (`) Amt. (`) brought by Atul and Geeta in cash)

Abhishek’s Capital A/c Dr. 75,000 23. Revaluation Account

Vivek’s Capital A/c Dr. 1,50,000 Particulars Amt. (`) Particulars Amt. (`)

   To Kamal’s Capital A/c 1,50,000 To Profit Transferred to By Machinery A/c 80,000

Partners’ Capital A/cs:
   To Tarun’s Capital A/c 75,000
Bhumi 50,000
(Being capital accounts
  Chavi 30,000 80,000
of partners adjusted for
goodwill) 80,000 80,000

Partners’ Capital Account

Particulars Bhumi (`) Chavi (`) Aditi (`) Particulars Bhumi (`) Chavi (`) Aditi (`)

To Cash A/c 82,500 1,97,500 — By Balance b/d 3,20,000 3,40,000 —

To Balance c/d 3,75,000 2,25,000 3,00,000 By Cash A/c — — 3,00,000
By Premium for Goodwill A/c 37,500 22,500 —
By General Reserve 50,000 30,000 —
By Revaluation A/c 50,000 30,000 —

4,57,500 4,22,500 3,00,000 4,57,500 4,22,500 3,00,000

 Accountancy  |  Class 12 | 11
Working Notes: Cash Book (with Bank Column Only)
1.       Goodwill = 60,000 × 3 = ` 1,80,000 Date Particulars Amt. (`) Date Particulars Amt. (`)
1
Aditi’s Goodwill = 1,80,000 × = ` 60,000 To Share By Share
3
2. New Profit Sharing Ratio: Application Application
Let the whole share be = 1 A/c 7,20,000   A/c 1,20,000
1
     Aditi’s Share = To Share By Balance c/d 12,11,000
3
Allotment
1 2   A/c 3,00,000
   Remaining Share = 1 − =
3 3
2 5 10 To Share First
Bhumi’s New Share = × = and Final
3 8 24
   Call A/c 2,85,000
2 3 6
Chavi’s New Share = × = To Share
3 8 24
   Capital A/c 20,000
1 8 8
       Aditi’s Share = × = To Securities
3 8 24
Premium
      New Shares = 10 : 6 : 8 = 5 : 3 : 4   A/c 6,000
1
3.       For rd Share Aditi’s Capital = ` 3,00,000
3 13,31,000 13,31,000
     Total Capital = 3,00,000 × 3 = ` 9,00,000
5
Bhumi’s Capital = 9,00,000 × = ` 3,75,000 Working Notes:
12
3 (`)
1. Money Refunded: 
Chavi’s Capital = 9,00,000 × = ` 2,25,000
12 Amount received on application money
Or
  (1,80,000 × 4) = 7,20,000
24. In the Books of Shaktimaan Ltd.
Journal Entries Adjusted on share capital (1,00,000 × 4) = (4,00,000)

Date Particulars L.F. Amt. (`) Amt. (`)       Refunded (30,000 × 4) =(1,20,000)
Share Application A/c Dr. 6,00,000 Amount adjusted in share allotment    = 2,00,000
   To Share Capital A/c 2,00,000
   To Securities Premium A/c 2,00,000 2. Capital Reserve:
   To Share Allotment A/c 2,00,000 Share forfeiture for 2,000 shares
(Being application money  2,000 
utilised)  35,000 ×  = 14,000
 5,000 
Share Allotment A/c Dr. 5,00,000 
   To Share Capital A/c 5,00,000 Less: Share forfeiture debited on re-issue = Nil
(Being allotment due with Amount of share forfeiture to be
premium)
transferred to capital reserve account = `14,000
Share First and Final Call A/c Dr. 3,00,000
   To Share Capital A/c 3,00,000 Or

(Being call money due) Journal Entries

Calls-in-arrears A/c Dr. 15,000 Date Particulars Amt. (`) Amt. (`)
   To Share First and Final Bank A/c (4,00,000 × 3) Dr. 12,00,000
Call A/c 15,000 To Equity Share Application A/c 12,00,000
(Being call money received (Being application money received
except of Manthan) on 4,00,000 shares)
Share Capital A/c Dr. 50,000 Equity Share Application A/c Dr. 12,00,000
   To Share Forfeiture A/c 35,000 To Equity Share Capital A/c 6,40,000
   To Calls-in-arrears A/c 15,000 (3,20,000 × 2)
To Securities Premium Reserve A/c 3,20,000
(Being Manthan shares
To Equity Share Allotment A/c 1,20,000
forfeited)
To Bank A/c (40,000 × 3) 1,20,000
Share Forfeiture A/c Dr. 14,000
(Being amount of application
   To Capital Reserve A/c 14,000 money transferred to share capital
(Being gain on re-issue account and excess money is
transferred to capital reserve adjusted towards allotment)
account)
12 |
Equity Share Allotment A/c Dr. 16,00,000 Bank A/c (22,34,400 - 16,800) Dr. 22,17,600
(3,20,000 × 5)
To Equity Share First and Final Call A/c 22,17,600
To Equity Share Capital A/c 9,60,000
(3,20,000 × 3) (Being amount received on first and
To Securities Premium Reserve final call account)
A/c (3,20,000 × 2) 6,40,000
Equity Share Capital A/c (2,400 × 10) Dr. 24,000
(Being amount due on allotment)
Securities Premium Reserve A/c Dr. 4,800
Bank A/c Dr. 14,76,300
(6,00,000 - 1,20,000 - 3,700) (2,400 × 2)
To Equity Share Allotment A/c 14,76,300 To Equity Share Forfeiture A/c 12,000
(Being amount received on allotment)
To Equity Share First and Final
Equity Share Capital A/c (800 × 5) Dr. 4,000
Call A/c (2,400 × 7) 16,800
Securities Premium Reserve A/c Dr. 1,600
(800 × 2) (Being Ganesh’s shares forfeited)
To Share Forfeiture A/c 1,900 Bank A/c (1,500 × 8) Dr. 12,000
To Share Allotment A/c 3,700
(Being 800 shares of Jeevan Share Forfeiture A/c (1,500 × 2) Dr. 3,000
forfeited due to non-payment of To Equity Share Capital A/c 15,000
allotment money)    (1,500 × 10)
Equity Share First and Final Call A/c Dr. 22,34,400 (Being forfeited share re-issued @
(3,19,200 × 7)
` 8 per share fully paid-up)
To Equity Share Capital A/c 15,96,000
Equity Share Forfeiture A/c Dr. 2,400
(3,19,200 × 5)
To Capital Reserve A/c 2,400
To Securities Premium Reserve
(Being excess amount on forfeiture
A/c (3,19,200 × 2) 6,38,400
(Being amount due on first and transferred to capital reserve

final call on 3,19,200 shares) account)

Working Notes:
1.
Money Money Money Amount
Excess
Shares Shares received on transferred to transferred to adjusted Money
Categories application
Applied allotted application share capital securities premium on refunded
money
@ ` 3 each @ ` 2 each @ ` 2 each allotment
I 40,000 — 1,20,000 — — 1,20,000 — 1,20,000

II 3,60,000 3,20,000 10,80,000 6,40,000 3,20,000 1,20,000 1,20,000 —

4,00,000 3,20,000 12,00,000 6,40,000 3,20,000 2,40,000 1,20,000 1,20,000

2. Calculation of Amount Unpaid on Allotment: 4. Unpaid Amount of First and Final Call:
Shares applied by Jeevan Shares allotted to Ganesh
3,60,000
 = × 800 = 900 shares 3, 20,000
3, 20,000  = × 2, 700 = 2, 400 shares
 (`) 3,60,000
Excess money received from Jeevan (100 × 3) =   300 Unpaid amount on first and final call
Amount due on allotment (800 × 3)  = 2,400
(—) Excess application money  = (300)  = ` 16,800 (2,400× 7)
Amount unpaid on allotment = 2,100 5. Calculation of Amount Received from Ganesh:
(+) Amount unpaid on securities
premium reserve (800 × 2)  = 1,600 Amount received on application
Total amount unpaid on allotment = 3,700  = 4,800 (2,400 × 2) excluding premium
3. Calculation of Amount Received from Jeevan:
 (`) (+) Amount received on allotment = 7,200 (2,400 × 3)
Amount received on application (800 × 2)  =   1,600 Amount received from Ganesh = 4,800 + 7,200
(+) Excess application money = 300
 = 1,900 = ` 12,000
 Accountancy  |  Class 12 | 13
6. Calculation of Capital Reserve:
12% Debenture Application
(i) 800 shares of Jeevan: and Allotment A/c Dr. 1,80,000
 (`) Loss on Issue of
Debentures A/c Dr. 30,000
Share forfeiture (Cr) = 1,900 To 12% Debenture A/c 2,00,000

(—) Share forfeiture (Dr) (800 × 2) = (1,600) To Premium on
Redemption of
Capital Reserve 300 Debentures A/c 10,000
(Being debentures issued at
(ii) 200 shares of Ganesh: discount and redeemable
 12,000  at premium)
Share forfeiture (Cr)  × 700  = 3,500
 2, 400  26. Journal Entries
(—) Share forfeiture (Dr) (700 × 2)
= (1,400) Amt. Amt.
Date Particulars L.F.
(`) (`)
Capital Reserve = 2,100
(i) Realisation A/c Dr. 18,500
Total capital reserve = ` 2,400 (2,100 + 300) To Varun’s Capital A/c 18,500
25. In Books of Ghanshyam Ltd. (Being creditors paid by Varun)

          Journal Entries (ii) Realisation A/c Dr. 70,000

To Vivek’s Capital A/c 70,000
Date Particulars L.F. Amt. (`) Amt. (`) (Being Vivek’s wife’s loan paid by
(i) Bank A/c Dr. 1,10,000 Vivek)
To 12% Debenture (iii) Bank A/c Dr. 1,60,000
Application and To Realisation A/c 1,60,000
Allotment A/c 1,10,000 (Being unrecorded asset sold)
(Being debenture application (iv) Varun’s Capital A/c Dr. 90,000
and allotment money To Realisation A/c 90,000
received) (Being stock taken by Varun)
(v) Cash A/c Dr. 1,400
12% Debentures Application
To Realisation A/c 1,400
and Allotment A/c Dr. 1,10,000
(Being amount of bad debts
Loss on Issue of Debentures recovered)
A/c Dr. 5,000
(vi) Realisation A/c Dr. 4,900
To 12% Debentures A/c 1,00,000
To Vivek’s Capital A/c 4,900
To Securities Premium A/c 10,000 (Being realisation expenses paid by
To Premium on Vivek)
Redemption of
Debentures A/c 5,000 27. (d) (i), (ii) and (iii)
(Being debentures issued at 28. (b) 4 : 1
premium and redeemable Hint: Working Capital
at premium)         = Current Assets - Current Liabilities
(ii) Bank A/c Dr. 5,50,000 2,40,000 = (2,00,000 + 1,00,000 + 20,000)
To 12% Debenture  - Current Liabilities
Application and    Current Liabilities = ` 80,000
Allotment A/c 5,50,000 Current Assets
Current Ratio =
(Being debenture application Current Liabilities
and allotment money
3, 20,000
received) = =4:1
80,000
12% Debentures Application
29. (a) Both Assertion (A) and Reason (R) are true and
and Allotment A/c Dr. 5,50,000
Reason (R) is the correct explanation of Assertion
To 12% Debentures A/c 5,00,000
(A).
To Securities Premium A/c 50,000
Or
(Being debentures issued at
premium and redeemable (d) three months or less
at par) 30. (b) 3 times
Hint: Interest Coverage Ratio
(iii) Bank A/c Dr. 1,80,000
To 12% Debenture Profit before Interest and Tax
=
Application and Interest

Allotment A/c 1,80,000
(Being debenture application 6,00,000 + 4,00,000 + 5,00,000
=
and allotment money
5,00,000
received) = 3 times
14 |
31. (iii) Capital Work- Non-current Fixed Assets
in-progress Assets
S.No. Items Major Heads Sub-heads
(iv) Motor Vehicle Non-current Fixed Assets—
(i) Capital Non-current Long-term Loans Assets Tangible Assets
Advances Assets and Advances
(v) Stores and Current Inventories
(ii) Income Current Other Current Spare Parts Assets
Received in Liabilities Liabilities
Advance (vi) 9% Debentures Non-current Long-term
Liabilities Borrowings
32. Comparative Statement of Profit and Loss of Sharda Ltd.
for the year ended 31st March, 2022

Absolute Increase Percentage Increase

2020-21 2021-22
Particulars or Decrease or Decrease
(`) (`)
(`) (%)

I. Revenue from Operations 10,00,000 15,00,000 5,00,000 50

II. Add: Other Income 2,00,000 3,00,000 1,00,000 50

III. Total Revenue (I + II) 12,00,000 18,00,000 6,00,000 50

IV. Less: Expenses: 8,00,000 8,00,000 Nil Nil

Profit before Tax 4,00,000 10,00,000 6,00,000 150

V. Less: Tax @ 40% (1,60,000) (4,00,000) (2,40,000) 150

  Profit after Tax 2,40,000 6,00,000 3,60,000 150

33. Inventory Turnover Ratio Average Inventory

Cost of Revenue from Operations Opening Inventory + Closing Inventory
= =
Average Inventory 2

` 40,00,000 ` 7,00,000 + ` 17,00,000
For 2015-16 = = 6.67 times =
` 6,00,000 2

` 60,00,000 = ` 12,00,000
For 2016-17 = = 5 times
` 12,00,000 Or
2015-16: Cash Flow Statement (Main heads only)
Cost of Revenue from Operations
Particulars Amt. (`)
= ` 50,00,000 - ` 10,00,000 = ` 40,00,000
(A) Cash Flows from Operating Activities ×××
Average Inventory
(B) Cash Flows from Investing Activities ×××
Opening Inventory + Closing Inventory
=
2 (C) Cash Flows from Financing Activities ×××

` 5,00,000 + ` 7,00,000 Net increase (decrease) in cash and cash ×××

= = ` 6,00,000 equivalents (A + B + C)
2
(+) Cash and Cash Equivalents at the Beginning ×××
2016-17:
Cost of Revenue from Operations (-) Cash and Cash Equivalents at the end ××××
= ` 75,00,000 - ` 15,00,000 = ` 60,00,000

34.                  Cash Flow from Operating Activities

for the year ended 31st March, 2015
Particulars Amt. (`)
Cash Flow from Operating Activities
Net Profit before Tax and Extraordinary Items 58,000
Adjustments for:
(+) Goodwill Written-off 5,000
(+) Depreciation 42,000
(-) Profit on Sale of Plant (4,000) 43,000
Operating Profit before Working Capital Changes 1,01,000
 Accountancy  |  Class 12 | 15
(+) Decrease in Current Assets and Increase in Current Liabilities:
Outstanding Expenses 8,000
Prepaid Expenses 6,000
Trade Payables 24,000
(-) Increase in Current Assets and Decrease in Current Liabilities:
Trade Receivables (10,000) 28,000
Cash Generated from Operations 1,29,000
(-) Income Tax Paid (30,000)
Net Cash Flow from Operating Activities 99,000

Working Notes
1. C
 alculation of Net Profit before Tax and Extraordinary Items: (`)
Net Profit for the year (80,000 - 1,00,000) = (20,000)
    (+) Transfer to General Reserve 30,000
    (+) Dividend Paid    18,000
    (+) Tax Paid 30,000
 58,000
2.
Dr. Provision for Depreciation Account Cr.
Particulars Amt. (`) Particulars Amt. (`)
To Machinery A/c (Transfer) 24,000 By Balance b/d  82,000
To Balance c/d 1,00,000 By Depreciation A/c (Statement of Profit and Loss) (b/f) 42,000
1,24,000 1,24,000

Sample Paper-3
Answers
1. (a) Both statements are correct. Decrease in the market value of investment will
2. (a) Both Assertion (A) and Reason (R) are true and be compensated through investment fluctuation
Reason (R) is the correct explanation of Assertion reserve and rest will be distributed among old
(A). partners in their old profit sharing ratios.
3. (a) ` 7,500 6. (c) ` 2,40,000
Hint: 500 × 15 = ` 7,500 Hint: G paid for Goodwill = ` 1,20,000
Or 3 1
G’s share= =
(a) Both statements are correct. 6 2
4. (c) ` 1,68,000
2
Hint: Stock taken by X (`) Total Goodwill = 1, 20,000 × = ` 2,40,000
1
 80 
= (1,60,000 × 50%) ×  = 64,000
100  Or

  (c) The balance of share forfeiture account is
Stock sold = (1,60,000 × 50%) × 130  = 1,04,000
100  transferred to capital reserve account.

7. (d) not entitled for any interest on their additional
1,68,000
capitals.
5. (d) Investment Fluctuation
8. (a) Profit and Loss Suspense Account
   Reserve A/c    Dr.   80,000
9. (b) 1,10,00,000
To Investment A/c 10,000
10. (c) ` 20,00,000
To Indu’s Capital A/c 28,000
11. (d) 75,000
To Vijay’s Capital A/c 21,000 Hint:
To Pawan’s Capital A/c 21,000 No. of debentures to be issued
Hint:
(1, 10,00,000 − 20, 00, 000)
Market value of investment = ` 80,000 =

 (10 + 20)
Book value of investment = ` 90,000
  Fluctuation in value (loss) = 90,000 - 80,000 90,00,000
= = 75,000
   120
= ` 10,000
16 |
12. (c) (ii), (i), (iii), (iv) 1
Hint: Correct sequence of events is: E’s Share of Goodwill = 3,00,000 × = ` 1,00,000
3
(i) Default on calls
to be distributed among Sacrificing Partners i.e.,
(ii) Forfeiture of Shares
C and D in Sacrificing ratio of 1 : 1.
(iii) Reissue of Shares
(iv) Amount transferred to Capital Reserve Journal Entry
Or
Date Particulars L.F. Amt. (`) Amt. (`)
(d) ` 30,000
E’s Capital A/c Dr. 1,00,000
Hint: Value of machinery to be shown in balance
To C’s Capital A/c 50,000
40,000
sheet = × 100 = ` 30,000 To D’s Capital A/c 50,000
133.33
13. (b) ` 10,00,000 (Being premium for goodwill

Hint: adjusted)

No. of Debentures to be Issued 18. Journal Entries

8,00,000
= = 10,000 Debentures Date Particulars L.F. Amt. (`) Amt. (`)
( 100 − 20)
Debentures account will be credited with Assets A/c Dr. 10,00,000
Goodwill A/c Dr. 60,000
= ` 10,00,000 (10,000 × 100)
To Liabilities A/c 1,70,000
14. (d) 26 : 19 : 15 To Healthy World Ltd. 8,90,000
(Being assets and liability
1 2 2 taken over)
Hint: B’s Sacrifice = × =
4 3 12
Healthy World Ltd. Dr. 8,90,000
1 1 1 Loss on Issue of Debentures
N’s Sacrifice = × =
4 3 12 A/c Dr. 80,000
To 8% Debentures A/c 8,00,000
3 2 36 − 10 26
B’s New Share = − = = To Securities Premium A/c 40,000
5 12 60 60 To Premium on Redemption
A/c 80,000
2 1 24 − 5 19
N’s New Share = − = = To Bank A/c 50,000
5 12 60 60 (Being purchase consideration
1 15 15 discharged by issue of
C’s Share = × = debentures and in cash)
4 15 60

New Profit Sharing Ratio = 26 : 19 : 15 Working Note:

15. (d) ` 1,85,000 Calculation of Purchase Consideration
16. (a) Both Assertion (A) and Reason (R) are true  (`)
and Reason (R) is the correct explanation of 8,000 debentures issued at 5% Premium = 8,00,000
Assertion (A). (+) Premium = 40,000
1 (+) Cheque Issued = 50,000
17. E’s Share = rd which he acquires equally from C Purchase Consideration 8,90,000
3
and D. 19.       Allotment Table
1 1 1 1 1 1
C’s Sacrifice = × = ; D‘s Sacrifice = × = Application Allotment
3 2 6 3 2 6 No. of Debentures Refund
(` 20) (` 80)
1 3 3 15,000 Debentures Issued 3,00,000 12,00,000 —
A’s New Share = × = ;
4 3 12
Excess + 3,00,000 - 2,00,000 1,00,000
1 3 3
B’s New Share = × = 30,000 Debentures 6,00,000 10,00,000 1,00,000
4 3 12
1 1 3−2 1 In the Books of X Ltd.
C’s New Share = − = =
4 6 12 12 Journal Entries
1 1 3−2 1
D’s New Share = − = = Date Particulars L.F. Amt. (`) Amt. (`)
4 6 12 12
Bank A/c Dr. 6,00,000
1 4 4
E’s New Share = × = To 8% Debenture
3 4 12 Application A/c 6,00,000
New Ratio = 3 : 3 : 1 : 1 : 4 (Being debenture application
money received)
Firm’s Goodwill = ` 3,00,000;
 Accountancy  |  Class 12 | 17
8% Debenture Application A/c Dr. 6,00,000 20. Journal Entries
To 8% Debentures A/c 3,00,000 Date Particulars L.F. Amt. (`) Amt. (`)
To 8% Debenture Allotment Share Capital A/c Dr. 45,000
A/c 2,00,000 (500 × 90)
Securities Premium A/c Dr. 5,000
To Bank A/c 1,00,000
(500 × 10)
(Being debenture application
money transferred to    To Share Forfeiture A/c 25,000
    (500 × 50)
debentures account and
excess amount is adjusted    To Calls-in-Arrears A/c 25,000
and refunded)     (500 × 50)
(Being 500 shares forfeited)
8% Debenture Allotment A/c Dr. 12,00,000
Bank A/c (300 × 80) Dr. 24,000
To 8% Debentures A/c 12,00,000
Share Forfeiture A/c Dr. 6,000
(Being debenture allotment
due)    To Share Capital A/c 30,000
    (300 × 100)
Bank A/c Dr. 10,00,000
(Being 300 forfeited shares
To 8% Debenture reissued)
Allotment A/c 10,00,000 Share Forfeiture A/c Dr. 9,000
(Being debenture allotment
   To Capital Reserve A/c 9,000
money received)
(Being balance of share
Or forfeiture transferred to
capital reserve account)
Journal Entries
Date Particulars L.F. Amt. (`) Amt. (`)
Working Note:
Capital Reserve:
(i) Interest on C’s Capital A/c Dr. 72,000 Share forfeiture in 500 shares = ` 25,000
To C’s Capital A/c 72,000 300
Share forfeiture in 300 shares = ` 25,000 ×
(Being interest on C’s Capital 500
Account charged)                     = ` 15,000
P&L Appropriation A/c Dr. 72,000 Capital Reserve = Share forfeiture (Cr.)
To Interest on C’s Capital A/c 72,000  - Share forfeiture (Dr.)
(Being interest on C’s             = 15,000 - 6,000 = ` 9,000
capital transferred to P & L 21. Journal Entries
appropriation account)
Date Particulars L.F. Amt. (`) Amt. (`)
(ii) Interest on A’s Loan A/c Dr. 3,500
(i) Realisation A/c Dr. 40,000
To Bank A/c 3,500
To Sun’s Capital A/c 40,000
(Being interest on A’s loan paid)
(Being remuneration and
Profit and Loss A/c Dr. 3,500 expenses payable to Sun)
To Interest on A’s Loan A/c 3,500 (ii) Sun’s Capital A/c Dr. 14,000
(Being interest on A’s loan Kiran’s Capital A/c Dr. 14,000
transferred to P&L account)  To Deferred Advertisement
(iii) B’s Capital A/c Dr. 1,200 Suspense A/c 28,000
To Interest on B’s Drawings 1,200 (Being advertisement suspense
account has been debited in
   
A/c
partners’ capital account in
(Being entry for interest on B’s
their profit sharing ratio)
drawings passed)
(iii) (a) Kiran’s Capital A/c Dr. 30,000
Interest on B’s Drawings A/c Dr. 1,200   To Realisation A/c 30,000
To Profit & Loss 1,200 (Being 1/3 of stock has been
Appropriation A/c taken over by Kiran at 25%
(Being interest on B’s discount)
drawings transferred to P& L (b) No Entry
appropriation account) (c) Bank A/c Dr. 25,000
  To Realisation A/c 25,000
  Working Notes:
10 6 (Being stock realised)
(i) Interest on A’s Loan = 70,000 × ×
100 12 (iv) Cash/Bank A/c Dr. 7,000
= ` 3,500 To Realisation A/c 7,000
12 6 (Being amount realised from
(ii) Interest on B’s Drawings = 20,000 × ×
100 12 unrecorded assets after
payment of outstanding bill)
= ` 1,200
18 |
Working Notes: Working Note:
1. Realisation Expenses to be paid to 5
Sun fixed amount = ` 10,000 Manu’s share of goodwill = 96,000 × = ` 48,000
10
Add: 2% on realised value of assets
(12,00,000 + 3,00,000) × 2 = ` 30,000 to be contributed by Sonu and Tony in gaining ratio
100 3 : 2.
 = ` 40,000
3
1 Sonu = 48,000 × = ` 28,800
2. Stock value taken by Kiran = 1,20,000 × 5
3
   = ` 40,000 2
Tony = 48,000 × = ` 19, 200
 25  5
Less: 25% 40,000 ×  = ` 10,000
 100 
  = ` 30,000 23.
22. Dr. Revaluation Account Cr.
Dr. Manu’s Capital Account Cr.
Particulars Amt. (`) Particulars Amt. (`)
Particulars Amt. (`) Particulars Amt. (`)

To Drawings A/c 21,000 By Balance b/d 4,00,000 To Furniture A/c 30,000 By Investments A/c 40,000
To Manu’s By Sony’s Capital A/c 28,800
By Tony’s Capital A/c To Profit Transferred By Stock A/c 30,000
Executor’s A/c 4,48,000 19,200
By Profit and Loss to Partner’s Capital
Suspense A/c A/cs:
 5 4 13,000
 78, 000 × 10 × 12  Sanjana 24,000

By Interest on Capital A/c

Alok 16,000 40,000
 6 4
 4, 00, 000 × 100 × 12  8,000
70,000 70,000
4,69,000 4,69,000

Dr. Partners’ Capital Account Cr.

Particulars Sanjana (`) Alok (`) Nidhi (`) Particulars Sanjana (`) Alok (`) Nidhi (`)
To Cash A/c 30,000 20,000 — By Balance b/d 5,00,000 4,00,000 —
To Investments A/c — 3,00,000 — By Cash A/c — — 3,00,000
To Cash A/c 50,000 — — By Premium for Goodwill A/c 60,000 40,000 —
To Balance c/d 5,40,000 3,60,000 3,00,000 By Workmen’s Compensation
Reserve A/c 36,000 24,000 —
By Revaluation A/c 24,000 16,000 —
By Cash A/c — 2,00,000 —
6,20,000 6,80,000 3,00,000 6,20,000 6,80,000 3,00,000

Balance Sheet 2 3 6
as at 31st March, 2018 Alok =
× =
5 4 20
Liabilities Amt. (`) Assets Amt. (`) 9 6 1
New Profit Sharing Ratio = : : or 9 : 6 : 5
Creditors 60,000 Cash at Bank 6,66,000 20 20 4
Capitals: Debtors 1,46,000 2. Adjustment of Capital:
Sanjana 5,40,000 (-) Provision for 1
Alok 3,60,000 Doubtful Debts Nidhi’s Capital for th Share = ` 3,00,000.
4
Nidhi 3,00,000 12,00,000 (2,000) 1,44,000 4
Stock 1,80,000 Firm’s Capital = 3,00,000 × = ` 12,00,000
1
Furniture 2,70,000 9
12,60,000 12,60,000 Sanjana’s Capital = 12,00,000 × = ` 5,40,000
20
6
Working Notes: Alok’s Capital = 12,00,000 × = ` 3,60,000
20
1. New Profit Sharing Ratio:
1 3.
Nidhi’s Share = ,
4 Dr. Cash Account Cr.
1 3 Particulars Amt. (`) Particulars Amt. (`)
Remaining Share = 1 − =
4 4 To Balance b/d 1,66,000 By Sanjana’s Capital A/c 30,000
3 3 9
Sanjana = × = To Premium for By Alok’s Capital A/c 20,000
5 4 20 Goodwill A/c 1,00,000
 Accountancy  |  Class 12 | 19
To Alok’s Capital A/c 2,00,000 By Sanjana’s Capital A/c 50,000 To Debtors A/c 10,000
To Nidhi’s Capital A/c 3,00,000 By Balance c/d (b/f) 6,66,000
To Stock A/c 1,00,000
7,66,000 7,66,000
To Profit Transferred
Or to Partners’ Capital
    In the Books of L, M and N A/c’s :
Revaluation Account
  L 30,000
Dr.Cr.
   M 30,000
Particulars Amt. (`) Particulars Amt. (`) N 45,000 1,05,000

To Machinery A/c 25,000 By Land and Building 2,40,000 2,40,000

A/c 2,40,000

Dr.                     Partners’ Capital Account Cr.

Particulars L (`) M (`) N (`) Particulars L (`) M (`) N (`)

To Investment A/c — 50,000 — By Balance b/d 6,25,000 4,00,000 5,25,000

To Deferred Revenue Exp. By Revaluation A/c 30,000 30,000 45,000

A/c 20,000 20,000 30,000

To M’s Capital A/c 64,000 — 96,000 By L’s Capital A/c — 64,000 —

To M’s Loan A/c — 5,20,000 — By N’s Capital A/c — 96,000 —

To Balance c/d 12,80,000 — 19,20,000 By Bank A/c 7,09,000 — 14,76,000

13,64,000 5,90,000 20,46,000 13,64,000 5,90,000 20,46,000

Balance Sheet
as at 31st March, 2023
Liabilities Amt. (`) Assets Amt. (`)
Creditors 80,000 Bank 22,05,000
Bank Overdraft 22,000 Debtors 2,00,000
(-) Bad Debts Reserve (10,000) 1,90,000
Long-term Debts 2,00,000 Stock 4,00,000
Employees Provident Fund 38,000 (-) Decreased (1,00,000) 3,00,000
M’s Loan 5,20,000
Capital Accounts:
L 12,80,000 Investment 1,00,000
N 19,20,000 32,00,000 (-) Taken by ‘M’ (50,000) 50,000
Land and Building 5,00,000
(+) Appreciation 2,40,000 7,40,000
Machinery 2,50,000
(-) Depreciation (25,000) 2,25,000
Furniture 3,50,000
40,60,000 40,60,000

Working Notes: 2
3. New capital of L = 32,00,000 × = ` 12,80,000
1. Gaining Ratio 5
Old profit sharing ratio = 2 : 2 : 3
3
New ratio between L and N = 2 : 3 New capital of N = 32,00,000 × = ` 19, 20,000
5
Gaining ratio = 2 : 3 (as no change in ratio)
4. Bank balance at the end
2
2. Goodwill of M = 5,60,000 × = ` 1,60,000 Bank in the beginning = ` 20,000
7

Add: Cash brought by
2
Borne by L = 1,60,000 × = ` 64,000 L = ` 7,09,000
5
N = ` 14,76,000
3
Borne by N = 1,60,000 × = ` 96,000 Bank at the end ` 22,05,000
5
20 |
24. Journal Entries (-) First and final call money due (300 × 7) =  2,100
Date Particulars Amt. (`) Amt. (`) Calls-in-arrears =   (1,300)
6
Bank A/c (1,50,000 × 8) Dr. 12,00,000 2. Shares applied by Y = 200 × = 300
4
To Share Application and
Allotment A/c 12,00,000 Application and allotment money received  (`)
(Being application and allotment (300 × 8) =    2,400
money received) (-) Application and allotment money due
Share Application and Allotment A/c Dr. 12,00,000 (200 × 8)  = (1,600)
To Share Capital A/c (1,00,000 × 5) 5,00,000 Excess =  800
To Securities Premium A/c 3,00,000 (-) First and final call money due (200 × 7) = (1,400)
   (1,00,000 × 3) Calls-in-arrears 600
To Calls-in-advance A/c 3,20,000
(40,000 × 8) Or
To Bank A/c (10,000 × 8) 80,000 Journal Entries
(Being 1,00,000 shares allotted
Date Particulars Amt. (`) Amt. (`)
excess money refunded)
(i) Share Capital A/c Dr. 1,00,000
Share First and Final Call A/c Dr. 7,00,000
(1,00,000 × 7)    To Share Forfeiture A/c 80,000
To Share Capital A/c (1,00,000 × 5) 5,00,000    To Share Second and Final
To Securities Premium A/c 2,00,000     Call A/c 20,000
(1,00,000 × 2)
(Being 10,000 shares
(Being first and final call money
forfeited for non-payment of
due)
second and final call)
Bank A/c Dr. 3,78,000
Bank A/c Dr. 42,000
Calls-in-advance A/c Dr. 3,20,000
To Share First and Final Call A/c 6,98,000 Share Forfeiture A/c Dr. 18,000
(Being first and final call money    To Share Capital A/c 60,000
received)
(Being 6,000 forfeited shares
Share Capital A/c (500 × 10) Dr. 5,000 reissued @ ` 7 fully paid up)
Securities Premium A/c (500 × 2) Dr. 1,000
Share Forfeiture A/c Dr. 30,000
To Share Forfeiture A/c 4,100
 
To Share Final Call A/c 1,900    To Capital Reserve A/c 30,000
(Being 500 shares forfeited)
(Being balance of share
Bank A/c (500 × 12) Dr. 6,000 forfeiture account transferred
To Share Capital A/c (500 × 10) 5,000 to capital reserve account)
To Securities Premium A/c (500 × 2) 1,000
(ii) Share Capital A/c Dr. 6,400
(Being 500 shares forfeited
   To Share Forfeiture A/c 4,000
and re-issued @ ` 12 each fully
paid-up)    To Share First Call A/c 2,400

Share Forfeiture A/c Dr. 4,100 (Being 800 shares forfeited

To Capital Reserve A/c 4,100 for non-payment of share
(Being profit on re-issue of shares first call money)

transferred to capital reserve Bank A/c Dr. 9,600

account)    To Share Capital A/c 8,000
   To Securities Premium
Working Notes:
Reserve A/c 1,600
 8
  1. Number of shares applied by X  300 ×  = 400 (Being 800 forfeited shares
 6 reissued @ ` 12 each)
 (`) Share Forfeiture A/c Dr. 4,000
Application and allotment money received
   To Capital Reserve A/c 4,000
(400 × 8)  =     3,200
(Being balance of share
(-) Application and allotment due (300 × 8) = (2,400) forfeiture account transferred
Excess = 800 to capital reserve account)
 Accountancy  |  Class 12 | 21
Working Notes: To 6% Debentures A/c 50,00,000
(i) Capital Reserve: To Securities Premium A/c 2,50,000
Share forfeiture Cr. for 10,000 shares = ` 80,000 To Premium on
Redemption of
6,000 Debentures A/c 5,00,000
For 6,000 reissued shares = 80,000 ×
10,000 (Being allotment of
 = ` 48,000 debentures at premium and
redeemable at premium)

Less: Share forfeiture Dr. for 6,000 shares
Amount of share forfeiture to be = ` 18,000 (iii)    Journal Entry
transferred to Capital Reserve A/c = ` 30,000 Date Particulars L.F. Amt. (`) Amt. (`)
(ii) Capital Reserve:
Securities Premium A/c Dr. 2,50,000
As all the forfeited shares (800 shares) have been
Statement of Profit and Loss Dr. 2,50,000
reissued at premium, the whole amount of share
To Loss on Issue of
forfeiture will be transferred to Capital Reserve
Debentures A/c 5,00,000
Account.
(Being loss on issue of
25. (i) Number of debentures to be issued debentures written-off)
Amount to be raised (iv) As the debentures are redeemable after 5 years.
=
Rate per debenture + Premium
It is considered that they will be paid lump-sum.
52,50,000 Hence, the company is required to investment 15%
= = 50,000
(100 + 5) of the value of debentures, which is ` 7,50,000

(ii)     Journal Entries  15 
 50,00,000 × .
 100 
Date Particulars L.F. Amt. (`) Amt. (`)
Bank A/c Dr. 52,50,000 Dr. Loss on Issue of Cr.
To 6% Debenture Debentures Account
Application and
Allotment A/c 52,50,000 Particulars Amt. (`) Particulars Amt. (`)
(Being debenture money To Premium on By Securities
received) Redemption of Premium A/c 2,50,000
6% Debenture Application Debentures A/c 5,00,000 By Statement of
and Allotment A/c Dr. 52,50,000 Profit and Loss 2,50,000
Loss on Issue of 5,00,000 5,00,000
Debentures A/c Dr. 5,00,000

26.
Dr. Realisation Account Cr.

Particulars Amt. (`) Particulars Amt. (`)

To Sundry Assets A/c: By Sundry Liabilities A/c:

Debtors 1,70,000 Creditors 60,000

Stock 1,50,000 Arnab’s Brother Loan 95,000

Investment 2,50,000 Investment Fluctuation Fund 50,000 2,05,000

Building 3,00,000 8,70,000 By Provision for Doubtful Debts 20,000

To Arnab’s Capital A/c (Brother’s Loan) 95,000 By Bank A/c (Assets realised):

To Bank A/c (Creditors) [60,000 - (60,000 × 10%)] 54,000 Stock (75,000 - 20% of ` 75,000) 60,000

To Dhrupad’s Capital A/c (Expenses) 3,000 Debtors 1,70,000

To Profit Transferred to Partner’s Capital A/cs: Investment 2,00,000

  Arnab 25,800 Building (3,55,000 - 5,000) 3,50,000 7,80,000

  Ragini 8,600 By Ragini’s Capital A/c (Stock 50%) 60,000

Dhrupad 8,600 43,000 [75,000 - (75,000 × 20%)]

10,65,000 10,65,000
22 |
Dr. Partners’ Capital Account Cr.

Particulars Arnab (`) Ragini (`) Dhrupad (`) Particulars Arnab (`) Ragini (`) Dhrupad (`)

To Profit and Loss A/c 30,000 10,000 10,000 By Balance b/d 2,75,000 2,00,000 1,70,000

To Realisation A/c (Stock) — 60,000 — By Realisation A/c (Loan) 95,000 — —

To Bank A/c (Final payment) 3,65,800 1,38,600 1,71,600 By Realisation A/c (Expenses) — — 3,000

By Realisation A/c (Profit) 25,800 8,600 8,600

3,95,800 2,08,600 1,81,600 3,95,800 2,08,600 1,81,600

Dr. Bank Account
Cr.
Particulars Amt. (`) Particulars Amt. (`)
To Balance b/d 50,000 By Dhrupad’s Loan A/c 1,00,000
To Realisation A/c (Stock) 60,000 By Realisation A/c (Creditors) 54,000
To Realisation A/c (Investments) 2,00,000 By Arnab’s Capital A/c (Final payment) 3,65,800
To Realisation A/c (Building) 3,50,000 By Ragini’s Capital A/c (Final payment) 1,38,600
To Realisation A/c (Debtors) 1,70,000 By Dhrupad’s Capital A/c (Final payment) 1,71,600
8,30,000 8,30,000

27. (a) 22.2% 2. Sale of Investment is calculated as:  (`)

Shareholders' Fund  40 
Hint: Proprietary Ratio = Value of Investment Sold  68,000 × 
Total Assets  100  = 27,200
(+) Profit on Sale  = 16,800
Shareholder’s Fund
 44,000
=Total Assets - Long-term Borrowings
3.    Cash Flow from Investing Activities
 - Long-term Provision - Current Liabilities
=4,50,000 - 50,000 - 1,00,000 - 2,00,000 Particulars Amt. (`) Amt. (`)
=` 1,00,000 Sale of Investment 44,000
(–) Purchase of Investment (15,200)
Total Assets = Non-current Assets + Current Assets
Cash Flow from Investing Activities 28,800
           =3,60,000 + 90,000
Or
   = ` 4,50,000
29. (c) ` 30,000 received from debtors
1,00,000 Or
Proprietary Ratio = × 100 = 22.2%
4,50,000 (c) Assertion (A) is true, but Reason (R) is false.
28. (c) ` 28,800 30. (d) Statement I is incorrect and statement II is
Hint: correct.
1. 31. S.No. Items Major Heads Sub-heads
   Dr.              Investment Account      Cr.
(i) General Shareholder’s Reserves and
Particulars Amt. (`) Particulars Amt. (`)
Reserves Funds Surplus
To Balance b/d 68,000 By Cash A/c  44,000
(ii) Short-term Current Short-term
(Sale of Investment)
Loans and Liabilities Borrowings
To Profit and Loss By Balance c/d 56,000
Advances
A/c 16,800
(Profit on Sale) (iii) Capital Work- Non-current Fixed Assets—
To Cash A/c 15,200 in-Progress Assets Capital Work-
(Purchase of in-Progress
Investment) (iv) Design Non-current Fixed Assets—
1,00,000 1,00,000
Assets Intangible Assets

32.                 Comparative Balance Sheet of CC Ltd.

as at 31st March, 2022
Absolute Percentage
Note 2020-21 2021-22
Particulars Increase or Increase or
No. (`) (`)
Decrease (`) Decrease (%)
I. Equity and Liabilities
   1. Shareholder's Funds:
     (a) Share Capital 3,00,000 6,00,000 3,00,000 100
    (b) Reserve and Surplus 1,00,000 2,00,000 1,00,000 100
 Accountancy  |  Class 12 | 23
  2. Non-current Liabilities
     Long-term Borrowings 2,00,000 4,00,000 2,00,000 100
  3. Current Liabilities 1,50,000 3,00,000 1,50,000 100
Total 7,50,000 15,00,000 7,50,000 100

II. Assets
   1. Non-current Assets:
Fixed Assets 4,00,000 8,00,000 4,00,000 100
  2. Current Assets 3,50,000 7,00,000 3,50,000 100
Total 7,50,000 15,00,000 7,50,000 100

33. Ratio analysis is a technique which involves Or

regrouping of data by application of arithmetical Cash Flows from Financing Activities
relationships.
The advantages of ratio analysis are as follows: Particulars Amt. (`)
(i) It provides useful assistance in inter-firm and Proceeds from Long-term Borrowings 15,00,000
intra-firm comparison. Repayment of Long-term Borrowings (10,00,000)
(ii) It helps in displaying trends. Net Cash Inflow from Financing Activities 5,00,000

  Working Notes:
Dr. Long-term Loan Account Cr.
Particulars Amt. (`) Particulars Amt. (`)
To Cash A/c (Loan repaid) 10,00,000 By Balance b/d 20,00,000
To Balance c/d 25,00,000 By Cash A/c (New loan raised) 15,00,000
35,00,000 35,00,000

34.                    In the Books of Fizz Ltd.

Cash Flow Statement
for the year ended 31st March, 2022
Particulars Amt. (`) Amt. (`)
Cash Flow from Investing Activities
Sale of Machinery 4,10,000
Purchase of Machinery (12,00,000)
Net Cash used in Investing Activities (7,90,000)
Cash Flow from Financing Activities
Issue of Equity Shares 30,00,000
Debentures Redeemed (20,00,000)
Dividend Paid (3,00,000)
Premium on Redemption of Debentures (2,00,000)
Interest on Debentures Paid (5,50,000)
Net Cash Used in Financing Activities (50,000)

Working Notes:
Machinery Account
Particulars Amt. (`) Particulars Amt. (`)
To Balance b/d 20,00,000 By Accumulated Depreciation 20,000
To Statement of P & L (Profit on Sale) 30,000 By Bank A/c (Sale) 4,10,000
To Bank A/c (Purchase) 12,00,000 By Balance c/d 28,00,000
32,30,000 32,30,000

Accumulated Depreciation Account

Particulars Amt. (`) Particulars Amt. (`)
To Machinery A/c 20,000 By Balance b/d 60,000
To Balance c/d 90,000 By Statement of P & L 50,000
1,10,000 1,10,000
24 |
Sample Paper-4
Answers
1. (a) gain 1/12 3 5 6−5 1
B= − = =
Hint: Sacrificing Ratio = Old Share - New Share 8 16 16 16
3 2 9−8 1
A= − = = Sacrifice Sacrificing Ratio = 3 : 1
4 3 12 12
7. (b) ` 2,20,000
1 1 3−4  1  8. (d) (i), (ii) and, (iii)
B= − = =   Gain
4 3 12  12  9. (c) 5 : 5 : 4 : 4

2. (c) 2 : 1 Hint: New Profit Sharing Ratio:

Hint: Gaining Share: 5
Zen =
3 2 1 18
Nitya = × = ;
6 3 3 5
Ben =
18
3 1 1
Anand = × =
6 3 6 8  8 1 8 4 8−4 4
Ken = − × = − = =
18  18 2  18 18 18 18
New Share of Nitya and Anand:
2 1 2+2 4 8 1 4
Nitya = + = = Ren = × =
6 3 6 6 18 2 18

1 1 1+1 2 New Profit Sharing Ratio = 5 : 5 : 4 : 4

Anand = + = =
6 6 6 6 10. (b) ` 40,00,000
Gaining Ratio = 4 : 2 or 2 : 1 Hint: Capital brought in by Ren is equal to the amount
3. (c) ` 30,000 that Ken could not bring, i.e., ` 40,00,000.
Hint: Normal Profit = 5,00,000 × 10% = ` 50,000 11. (b) Premium for Goodwill A/c Dr. 15,00,000
Super Profit = 60,000 - 50,000 = ` 10,000 To Ken’s Capital A/c 15,00,000
  Goodwill = 10,000 × 3 = ` 30,000 12. (b) from statement of profit and loss
   Or Or
(c) Security Premium Reserve Account (c) ` 360
4. (d) Only (iv) 12 6
Hint: Interest on Drawings = 6,000 × × = ` 360
5. (a) Both Assertion (A) and Reason (R) are true and 100 12
Reason (R) is the correct explanation of Assertion 13. (c) The company cannot raise more capital than
(A). the amount of capital as specified in the
6. (c) ` 4,800; ` 2,700; ` 2,100 respectively Memorandum of Association.
Hint: 14. (a) Both Assertion (A) and Reason (R) are true and
Share Capital A/c (600 × 8)    Dr. 4,800 Reason (R) is the correct explanation of Assertion
To Share Forfeiture A/c  2,700 (A).
To Equity Share Allotment A/c  2,100 15. (d) ` 30,000 (Loss)
600
Shares Applied = × 3 = 900 shares Hint: Balance Sheet
2
  (`) Amt. Amt.
Liabilities Assets
(1) 900 × 3 = 2,700 (`) (`)

(-) 600 × 3 = (1,800) Creditors 70,000 Cash 10,000

900
Partners’ Capital 1,20,000 Other Assets 1,80,000
(2) Due on Allotment = 3,000
(-) Excess Adjusted = (900) 1,90,000 1,90,000
2,100
   Or
(a) 3 : 1     (`)
Hint: Sacrificing Ratio = Old Share – New Share Value of other Assets = 1,80,000

5 7 10 − 7 3 (-) Realised = (1,50,000)

A= − = =
8 16 16 16 Loss on Realisation = 30,000
 Accountancy  |  Class 12 | 25
16. (b) (i) all partners, (ii) old partners Notes to Accounts:
Particulars Amt. (`)
17.   Profit and Loss Appropriation Account
1. Share Capital:
   for the year ending 31st March, 2022
Dr.Cr.
Authorised Capital:
Amt. Amt. 2,00,000 Equity Shares of ` 10 each 20,00,000
Particulars Particulars
(`) (`)
Issued Capital:
To Interest on Partners’ Capital By P & L A/c 1,20,000
60,000 Equity Shares of ` 10 each 6,00,000
Akhil 6,000
Subscribed Capital:
Nikhil 4,800 10,800
   Subscribed and Fully Paid-up
To Net Profit transferred to 56,000 shares of ` 10 each fully paid up 5,60,000
Partners’ Capital A/c    (+) Shares Forfeited 14,000
Akhil 65,520
5,74,000
Nikhil 43,680 1,09,200
Or
1,20,000 1,20,000 Journal Entries

18. Journal Entries Date Particulars L.F. Amt. (`) Amt. (`)
Amt. Amt. Sundry Assets A/c Dr. 18,00,000
Date Particulars L.F.
(`) (`) Goodwill A/c Dr. 4,00,000
(i) (a) Gaurav’s Capital A/c Dr. 3,00,000 To Sundry Creditors A/c 2,00,000
[6,00,000 - (6,00,000 To Rohit & Co. 20,00,000
(Being business of
×  50%)]
Rohit & Co. purchased
To Realisation A/c 3,00,000 for a consideration of
(Being machinery taken ` 20,00,000)
over by Gaurav)
Rohit & Co. Dr. 20,00,000
(b) No Entry Discount on Issue
of Debentures A/c Dr. 10,00,000
(ii) Cash/Bank A/c Dr. 3,92,000
(20,000 × 50)
[4,00,000 - (4,00,000
To 8% Debentures A/c 30,00,000
× 2/100)] (20,000 × 150)
To Realisation A/c 3,92,000 (Being paid to Rohit & Co.
(Being land and building sold) by issue of 20,000, 8%
debentures of ` 150 each
(iii) (a) Realisation A/c Dr. 76,000 at a discount of ` 50 per
To Cash/Bank A/c 76,000 debenture)
(Being payment made to
Working Note:
creditors)
20,00,000
(b) Vaibhav’s Capital A/c Dr. 17,000    Number of debentures issued = = 20,000
(150 − 50)
To Realisation A/c 17,000
(Being assets taken over by
20. In the Books of Nisha Ltd.
Vaibhav) Journal Entries

(iv) Realisation A/c Dr. 3,21,000 Date Particulars L.F. Amt. (`) Amt. (`)

(3,00,000 + 21,000) Machinery A/c Dr. 1,78,000

To Nisha Ltd. 1,78,000
To Bank A/c 3,21,000
(Being machinery purchased
(Being bank loan paid along
from Nisha Ltd.)
with interest)
Nisha Ltd. Dr. 1,78,000
Discount on Issue of
19. Balance Sheet
Debentures A/c (200 × 10) Dr. 2,000
as at ……………… To Equity Share Capital
Particulars Note No. Amt. (`) A/c (10,000 × 10) 1,00,000
To 9% Debentures A/c 20,000
I. EQUITY AND LIABILITIES   (200 × 100)
1. Shareholder’s Funds: To Bills Payable A/c 50,000
(a) Share Capital 1 5,74,000 To Securities Premium
Reserve A/c (10,000 × 1) 10,000
5,74,000
(Being payment made to Nisha
Ltd.)
26 |
Working Note: 22.
Purchase Consideration = 1,10,000 (10,000 × 11) Dr. Rekha’s Capital Account Cr.
 + 18,000 (200 × 90) + 50,000 Particulars Amt. (`) Particulars Amt. (`)
To Rekha’s By Balance b/d 4,50,000
    = ` 1,78,000
Executors A/c 6,95,250 By General Reserve A/c 80,000
21. 5 Years’ Average Profit
 4
=
4,00,000 + 3,00,000 + 2,00,000 + 50,000 + (50,000)  2, 00, 000 × 10 
5   
By Manika’s Capital A/c 1,00,000
= ` 1,80,000 By Mohit’s Capital A/c 20,000
By Profit and Loss
Firm’s Goodwill = 5 Years’ Average Profit × No. of
Suspense A/c 34,000
 Years’ Purchase By Interest on Capital
= 1,80,000 × 3 = ` 5,40,000 A/c 11,250
1 6,95,250 6,95,250
S’s Share of Goodwill = 5,40,000 × = ` 1,08,000
5
Working Notes:
Journal Entries  1. 4 year’s total profit = 2,20,000 + 3,00,000 + 3,60,000
Date Particulars L.F. Amt. (`) Amt. (`)  + 3,20,000
= ` 12,00,000
2018
Apr. 01 Cash A/c Dr. 1,08,000 12,00,000
Average profit or goodwill = = ` 3,00,000
To Premium for Goodwill A/c 1,08,000 4
(Being goodwill brought in by
Rekha’s share of goodwill
new partner)
4
Premium for Goodwill A/c Dr. 1,08,000 = 3,00,000 × = ` 1, 20,000
To L’s Capital A/c 54,000 10
To M’s Capital A/c 32,400 to be contributed by Manika and Mohit in the ratio of
To N’s Capital A/c 21,600 5 : 1.
(Being premium for goodwill 2. 2 year’s average profit
distributed among old
3,60,000 + 3, 20,000
partners in sacrificing ratio) = = ` 3, 40,000
2
Note: It is not clearly mentioned in the question that new Rekha’s share of profit
partner ‘S’ bring his share of goodwill in cash or not. 4 3
So, it is assumed that goodwill premium is brought = 3, 40,000 × × = ` 34,000
10 12
in cash.
10 3
Alternatively, entry for not bringing goodwill 3. Interest on capital = 4,50,000 × × = ` 11, 250
100 12
premium in cash can be passed.
23.
Dr. Revaluation Account Cr.
Particulars Amt. (`) Particulars Amt. (`)

To Stock A/c 20,000 By Bad Debts Recovered 4,000

To Outstanding Salary A/c 12,000 By Loss Transferred to:

Abhir’s Capital A/c 21,000

Divya’s Capital A/c 7,000 28,000
32,000 32,000

Dr. Partners’ Capital Account Cr.

Particulars Abhir (`) Divya (`) Vibhor (`) Particulars Abhir (`) Divya (`) Vibhor (`)

To Revaluation A/c (Loss) 21,000 7,000 — By Balance b/d 6,00,000 4,00,000 —

To Balance c/d 7,59,000 4,53,000 3,03,000 By Premium for Goodwill A/c 60,000 20,000 —
By Investment Fluctuation Fund A/c 30,000 10,000 —
By General Reserve A/c 90,000 30,000 —
By Bank A/c — — 3,03,000

7,80,000 4,60,000 3,03,000 7,80,000 4,60,000 3,03,000

 Accountancy  |  Class 12 | 27
Balance Sheet
as at 1st April, 2017

Liabilities Amt. (`) Assets Amt. (`)

Outstanding Salary 12,000 Stock 3,00,000

Creditors 2,20,000 (-) Depreciated (20,000) 2,80,000
Employee’s Provident Fund 1,00,000 Debtors 6,50,000
Partners’ Capital A/cs: (-) Provision for Bad Debts (50,000) 6,00,000

Abhir 7,59,000 Investment 4,40,000

Divya 4,53,000 Cash at Bank 5,27,000
Vibhor 3,03,000 15,15,000

18,47,000 18,47,000

Working Notes: Bad Debts A/c Dr. 4,000

To Debtors A/c 4,000
1. Abhir’s Capital = ` 7,59,000
(Being debtors of ` 4,000
Divya’s Capital = ` 4,53,000 written-off)
Revaluation A/c Dr. 8,300
  ` 12,12,000
To Bad Debts A/c 4,000
To Provision for Bad and
1
Vibhor’s Share = Doubtful Debts A/c 4,300
5
(Being provision utilised for
1 4 writing-off bad debts)
Remaining Share = 1 − =
5 5 Provision for Bad and Doubtful
Debts A/c Dr. 10,000
4/5th Share Capital = 12,12,000;
To Revaluation A/c 10,000
5 1
1/5th Share Capital = 12,12,000 × × (Being excess provision trans-
4 5
ferred to revaluation account)
Vibhor’s Capital = ` 3,03,000 Revaluation A/c Dr. 20,000
2. To Creditors A/c 20,000
Dr. Bank Account Cr. (Being increase in creditors
recorded)
Particulars Amt. (`) Particulars Amt. (`)
Revaluation A/c Dr. 90,000
To Balance b/d 1,40,000 By Balance c/d 5,27,000 To Patents A/c 60,000
To Premium for Goodwill A/c 80,000 To Stock A/c 5,000
To Bad Debts Recovered 4,000 To Machinery A/c 15,000
To Vibhor’s Capital A/c 3,03,000 To Building A/c 10,000
(Being decrease in assets
5,27,000 5,27,000
recorded)
Sameer’s Capital A/c Dr. 43,320
Yasmin’s Capital A/c Dr. 32,490
Or
Saloni’s Capital A/c Dr. 32,490
Journal Entries To Revaluation A/c 1,08,300
Date Particulars L.F. Amt. (`) Amt. (`) (Being loss on revaluation
transferred to partner’s capital
2016
Mar. General Reserve A/c Dr. 60,000 account)
31 To Sameer’s Capital A/c 24,000 Yasmin’s Capital A/c Dr. 1,62,000
To Yasmin’s Capital A/c 18,000 Saloni’s Capital A/c Dr. 54,000
   To Saloni’s Capital A/c 18,000 To Sameer’s Capital A/c 2,16,000
(Being general reserve (Being goodwill adjusted on
distributed among partners)
Sameer’s retirement)
Sameer’s Capital A/c Dr. 20,000 Sameer’s Capital A/c Dr. 4,76,680
Yasmin’s Capital A/c Dr. 15,000
To Sameer’s Loan A/c 4,76,680
Saloni’s Capital A/c Dr. 15,000
(Being balance of Sameer’s
To Profit and Loss A/c 50,000
(Being accumulated losses capital account transferred to
divided among partners) Sameer’s loan account)
28 |
Working Notes: Equity Share Application A/c Dr. 24,00,000
1. Gaining Ratio = New Share - Old Share To Equity Share Capital A/c 12,00,000
(80,000 × 15)
Yasmin = 3 − 3 = 6 − 3 = 3 ; To Securities Premium Reserve
5 10 10 10 A/c (80,000 × 5) 4,00,000
2 3 4−3 1 To Equity Share Allotment A/c 4,00,000
Saloni = − = =
5 10 10 10 (20,000 × 20)
To Bank A/c (20,000 × 20) 4,00,000
Gaining Ratio = 3 : 1 (Being application money
4 transferred to share capital,
2. Sameer’s Share of Goodwill = 5, 40,000 × = ` 2, 16,000securities premium reserve,
10
share allotment and the balance
4 refunded)
= 5, 40 , 000 × = ` 2, 16, 000
10
to be contributed by Yasmin and Saloni in 3 : 1 Equity Share Allotment
ratio. A/c (80,000 × 15) Dr. 12,00,000
To Equity Share Capital A/c 8,00,000
3 (80,000 × 10)

Yasmin = 2, 16,000 × = ` 1,62,000
4 To Securities Premium Reserve
A/c (80,000 × 5) 4,00,000
1
Saloni = 2, 16,000 ×
= ` 54,000 (Being allotment money due on
4 80,000 shares)
3. Bank A/c Dr. 7,60,000
Calls-in-arrears A/c Dr. 40,000
Dr. Revaluation Account Cr. To Equity Share Allotment A/c 8,00,000
Particulars Amt. (`) Particulars Amt. (`) (Being allotment money received)
Equity Share First Call A/c Dr. 12,00,000
To Bad Debts A/c 4,000 By Provision for
(80,000 × 15)
To Provision for Doubtful Debts A/c 10,000
To Equity Share Capital A/c 12,00,000
Doubtful and
(Being first call money due on
Bad Debts A/c 4,300
80,000 shares)
To Patents A/c 60,000 Bank A/c Dr. 12,10,000
To Stock A/c 5,000 By Loss Transferred to Calls-in-arrears A/c (First call) Dr. 30,000
Capital A/cs: (2,000 × 15)
To Equity Share First Call A/c 12,00,000
To Machinery A/c 15,000 Sameer 43,320 To Calls-in-arrears A/c 40,000
(Allotment)
To Building A/c 10,000 Yasmin 32,490
(Being first call money received)
To Creditors A/c 20,000   Saloni 32,490 1,08,300 Equity Share Capital A/c Dr. 80,000
1,18,300 1,18,300 (2,000 × 40)
To Share Forfeiture A/c 50,000
To Calls-in-arrears A/c 30,000
4. (Being Sahaj’s shares forfeited for
Dr. Sameer’s Capital Account Cr. non-payment of first call)
Bank A/c (2,000 × 60) Dr. 1,20,000
Particulars Amt. (`) Particulars Amt. (`)
To Equity Share Capital A/c 1,00,000
To Profit and Loss A/c 20,000 By Balance b/d 3,00,000 (2,000 × 50)
 To Securities Premium Reserve
To Revaluation A/c 43,320 By General Reserve A/c 24,000 A/c (2,000 × 10) 20,000
To Sameer’s Loan A/c 4,76,680 By Yasmin’s Capital A/c 1,62,000 (Being Sahaj’s shares reissued at
` 60 per share)
By Saloni’s Capital A/c 54,000
Share Forfeiture A/c Dr. 50,000
5,40,000 5,40,000 To Capital Reserve A/c 50,000
(Being balance in share forfeiture
account transferred to capital
24.    Journal of EF Ltd. reserve)
Date Particulars Amt. (`) Amt. (`)
Working Notes:
Bank A/c (1,20,000 × 20) Dr. 24,00,000
24,00,000
1. Calls-in-arrears on Allotment:
To Equity Share Application A/c
Shares applied by Seema
(Being application money received
 4,000 × 1,00,000 
on 1,20,000 shares) =   = 5,000
 8,000 
 Accountancy  |  Class 12 | 29
Application money received  (`) Bank A/c (1,96,000 - 6,000) Dr. 1,90,000
(5,000 × 20) = 1,00,000 To Share Second and Final Call A/c 1,90,000
(-) Application money due (4,000 × 20)= (80,000) (Being second and final call money
Excess = 20,000 received)
Allotment money due (4,000 × 15) = 60,000 Share Capital A/c (3,000 × 10) Dr. 30,000
Calls-in-arrears 40,000
To Share Forfeited A/c (3,000 × 5) 15,000
2. Calls-in-arrears at First Call:
 
To Share Final Call A/c (3,000 × 9,000
Shares allotted to Sahaj
3) 6,000
 2,500 
 × 80,000   = 2,000 To Share Second and Final Call A/c
 1,00,000 
(3,000 × 2)
Calls-in-arrears (2,000 × 15)  = ` 30,000
(Being 3,000 shares of Reema
Or
forfeited)
In the Books of KLN Ltd.
Bank A/c Dr. 32,000
Journal Entries
Share Forfeiture A/c Dr. 8,000
Date Particulars Amt. (`) Amt. (`) To Share Capital A/c 40,000
Bank A/c (1,90,000 × 3) Dr. 5,70,000 (Being 4,000 shares re-issued)
To Share Application A/c 5,70,000
Shared Forfeiture A/c Dr. 9,750
(Being application money received)
To Capital Reserve A/c 9,750
Share Application A/c Dr. 5,70,000
To Share Capital A/c 2,00,000 (Being shares forfeiture amount
   (1,00,000 × 2) transferred to capital reserve
To Securities Premium A/c 1,00,000 account)
   (1,00,000 × 1)
To Share Allotment A/c 1,50,000 Working Notes:
   (50,000 × 3)   1. Number of shares allotted to Rajat
To Bank A/c (40,000 × 3) 1,20,000
 40,000 
(Being application money =  2,500 ×
  = 2,000
50,000 
transferred to capital account and
excess money adjusted towards  (`)
allotment and refund) Amount received on application (2,500 × 3) = 7,500
Share Allotment A/c (1,00,000 × 4) Dr. 4,00,000 (-) Calls-in-arrears (2,000 × 3)  = (6,000)
To Share Capital A/c (1,00,000 × 3) 3,00,000
To Securities Premium A/c 1,00,000 Excess 1,500
(1,00,000 × 1) Amount due on allotment (2,000 × 4)  = 8,000
(Being allotment money due)
Calls-in-arrears at allotment =   (6,500)
Bank A/c Dr. 2,43,500
2. Capital Reserve:
(4,00,000 - 1,50,000 - 6,500)
To Share Allotment A/c 2,43,500 Amount forfeited on Rajat’s 1,000 shares  (`)
(Being allotment money received)  5,500 
Share First Call A/c (1,00,000 × 3) Dr. 3,00,000  × 1000 = 2,750
2,000 
To Share Capital A/c 3,00,000

(Being first call money due) Amount forfeited on Reema’s 3,000 shares =  5,000
Bank A/c Dr. 2,85,000  17,750
(3,00,000 - 6,000 - 9,000)
2,85,000
(—) Loss on shares re-issued  = (8,000)
To Share First Call A/c
(Being first call money received) Transferred to Capital Reserve 9,750
Share Capital A/c (2,000 × 8) Dr. 16,000 25. In the Books of J.K. Ltd.
Security Premium A/c (2,000 × 1) Dr. 2,000 Journal Entries
To Share Forfeiture A/c 5,500
To Share Allotment A/c 6,500 Date Particulars L.F. Amt. (`) Amt. (`)
  To Share Final Call A/c 6,000 2015
(Being 2,000 shares of Rajat Dr. 75,20,000
Apr. Bank A/c (8,000 × 940)
forfeited)
1 To 9% Debenture
Share Second and Final Call A/c Dr. 1,96,000
Application and
(98,000 × 2) 75,20,000
1,96,000 Allotment A/c
To Share Capital A/c
(Being second and final call money (Being application money
due) received)
30 |
Apr. 9% Debenture Application Working Notes:
1 and Allotment A/c Dr. 75,20,000 9 6
1. Intereston Debentures = 80,00,000 × ×
Discount on Issue of 100 12
Debentures A/c Dr. 4,80,000 = ` 3,60,000
(8,000 × 60)
Loss on Issue of Debentures 10
2. Tax Deducted at Source = 3,60,000 ×
A/c (8,000 × 50) Dr. 4,00,000 100
To 9% Debentures A/c 80,00,000 = ` 36,000
(8,000 × 1,000)
To Premium on 26. Journal Entries
Redemption of
Debentures A/c Amt. Amt.
4,00,000 Date Particulars L.F.
(8,000 × 50) (`) (`)
(Being transfer of application
(i) Realisation A/c Dr. 2,600
money to debenture account
   To Aman’s Capital A/c 2,600
issued at discount of 6%,
(Being realisation expenses paid
redeemable at premium of
by Aman)
5%)
(ii) No Entry
Or
9% Debenture Application (iii) Bank A/c Dr. 3,500
and Allotment A/c Dr. 75,20,000 To Realisation A/c 3,500
Loss on Issue of Debentures (Being unrecorded assets sold)
A/c Dr. 8,80,000 (iv) Realisation A/c Dr. 19,000
To 9% Debentures A/c 80,00,000
To Premium on To Bank A/c 19,000
Redemption of (Being creditors paid)
Debentures A/c 4,00,000 (v) Bimal’s Capital A/c Dr. 24,000
(Being transfer of application
money to debenture account To Realisation A/c 24,000
issued at discount of 6%, (Being stock taken by Bimal)
redeemable at premium of (vi) Bank A/c Dr. 4,000
5%)
To Realisation A/c 4,000
Sep. Debenture Interest A/c Dr. 3,60,000 (Being investment sold)
30 To Debentureholders’ A/c 3,24,000
To TDS Payable A/c 36,000 27. (a) non-current assets
(Being interest payable on
28. (b) Both Assertion (A) and Reason (R) are true, but
9% debentures and tax
deducted at source @ 10%) Reason (R) is not the correct explanation of
Assertion (A).
Sep. Debentureholders’ A/c Dr. 3,24,000
30 TDS Payable A/c Dr. 36,000 29. (d) ` 65,000
To Bank A/c 3,60,000 Hint:  (`)
(Being interest paid to
Net Profit before Tax (90,000 - 60,000) = 30,000
debentures and TDS
deposited) (+) Proposed Dividend for the year = 35,000
2016  65,000
Mar. Debenture Interest A/c Dr. 3,60,000 Or
31 To Debentureholders’ A/c 3,24,000
To TDS Payable A/c 36,000 (a) Both Statements are correct.
(Being interest payable on
9% debentures and tax 30. (b) (i), (ii) and (iv) are correct
deducted at source @ 10%) H
 int: Point (iv) is incorrect as ideal current ratio is
Mar. Debentureholders’ A/c Dr. 3,24,000 2 : 1.
31 TDS Payable A/c Dr. 36,000 31. Total Assets to Debt Ratio
To Bank A/c 3,60,000
(Being interest paid to = Total Assets/Debt

debentures and TDS = ` 27,00,000/` 15,00,000
deposited)
= 1.8 : 1
Mar. Statement of
Total Assets = Shareholder’s Fund + Total Debt
31 Profit and Loss Dr. 7,20,000
To Debenture Interest A/c 7,20,000 = ` 7,50,000 + ` 19,50,000 
(Being interest on = ` 27,00,000
debentures transferred to
Debt = Total Debt - Current Liabilities
statement for profit and
loss) = ` 19,50,000 - ` 4,50,000 = ` 15,00,000
 Accountancy  |  Class 12 | 31
32. Cost of Revenue from Operations = ` 75,000 × 6 
S.No. Items Major Heads Sub-heads = ` 4,50,000
(i) Patents Non-current Fixed Assets— 1
Gross Profit = 33 % on cost
Assets Intangible Assets 3
(ii) Capital Work- Non-current Fixed Assets
1
in-Progress Assets   = 33 % × ` 4,50,000
3
(iii) Unpaid Dividend Current Other Current
Liabilities Liabilities   = ` 1,50,000
Revenue from Operations
33. Gross Profit Ratio
  = Gross Profit/Revenue from Operations × 100   = Cost of Revenue from Operations + Gross
Profit
  = ` 1,50,000/` 6,00,000 × 100
1
  = 25%   = ` 4,50,000 + 33 3 % of ` 4,50,000
Average Inventory
  = ` 4,50,000 + ` 1,50,000 = ` 6,00,000
  = (Opening Inventory + Closing Inventory)/2
Or
  = (` 60,000 + ` 90,000)/2 
Dr. Trade Payables Account  Cr.
= ` 75,000
Date Particulars Amt. (`) Date Particulars Amt. (`)
Inventory Turnover Ratio To Cash A/c 1,59,500 By Balance 14,000
Cost of Revenue from Operations (Balancing Figure) b/d
=
Average Inventory To Balance c/d 14,500 By Purchase 1,60,000
A/c
Cost of Revenue from Operations 1,74,000 1,74,000
=
` 75,000 Note: Cash paid for inventory amounts to `1,59,500.

34. Cash Flow Statement of Anuradha Ltd.

as at 31st March, 2022
Particulars Amt. (`)

Net Profit after Tax 50,000

Adjustment for:
   (+) Interest on Debentures 3,000
   (+) Depreciation 24,000
   (+) Patents Written off 2,000 29,000
Operating Profit before Working Capital Changes 79,000
   (+) Inventories Decreased 24,000
   (-) Trade Payables Decreased (25,000)
   (-) Other Current Liabilities Decreased (25,000)
   (-) Trade Receivables Increased (10,000) (36,000)
Net Cash Flow from Operating Activities 43,000

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