Accounting Round 1
Accounting Round 1
Accounting Round 1
Question 2
(a) Mr. Ratan was unable to agree the Trial Balance last year and wrote off the difference to
the Profit and Loss Account of that year. Next year, he appointed a Chartered Accountant
who examined the old books and found the following mistakes:
(i) Purchase of a scooter was debited to conveyance account ` 30,000. Mr. Ratan
charges 10% depreciation on scooter.
(ii) Purchase account was over cast by ` 1,00,000.
(iii) A credit purchase of goods from Mr. X for ` 20,000 was entered as sale.
(iv) Receipt of cash from Mr. Anand was posted to the account of Mr. Bhaskar ` 10,000.
(v) Receipt of cash from Mr. Chandu was posted to the debit of his account, ` 5,000.
(vi) ` 5,000 due by Mr. Ramesh was omitted to be taken to the Trial Balance.
(vii) Sale of goods to Mr. Ram for ` 20,000 was omitted to be recorded.
(viii) Amount of ` 23,950 of purchase was wrongly posted as ` 25,930.
Suggest the necessary rectification entries. (10 Marks)
(b) From the following information, ascertain the Cash Book balance of Mr. Bajaj as on
31st March, 2021:
(i) Debit balance as per Bank Pass Book ` 3,500. (5 Marks)
(ii) A cheque amounting to ` 2,500 deposited on 15th March, but the same was returned
by the Bank on 24th March for which no entry was passed in the Cash Book.
(iii) During March, two bills amounting to ` 2,500 and ` 500 were collected by the Bank
but no entry was made in the Cash Book
(iv) A bill for ` 5,000 due from Mr. Balaji previously discounted for ` 4,800 was
dishonored. The Bank debited the account, but no entry was passed in the Cash
Book.
(v) A Cheque for ` 1,500 was debited twice in the cash book.
(c) From the following information, calculate the historical cost of closing inventories using
adjusted selling price method:
Purchase during the year - ` 5,00,000
Sales during the year - ` 7,50,000
Opening Inventory Nil
Closing Inventory at selling price - ` 1,00,000 (5 Marks)
Question 3
(a) Ramesh lent ` 1,50,000 to Deepak on 1st January, 2016 at the rate of 12% per annum.
The loan is repayable as under:
(i) ` 10,000 on 1st January, 2017
(ii) ` 20,000 on 1st January, 2018
(iii) ` 30,000 on 1st January, 2019
(iv) ` 40,000 on 1st January, 2020
(v) ` 50,000 on 1st January, 2021
You are required to determine the average due date for settling all the above installments
by a single payment and compute interest. (5 Marks)
(b) ABC Limited supplied goods on sale or return basis to customers.
Goods are to be returned within 15 days from the date of dispatch, failing which it is treated
as sales. The books of BC Limited are closed on 31st March, 2021. The particulars of the
same are as under:
Date of Dispatch Party Name Amount Remarks
10.03.2021 PQR 25,000 No information till 31.03 .2021
12.03.2021 DEF 15,000 Returned on 16.03.2021
15.03.2021 GHI 40,000 Goods worth ` 8,000 Returned on
20.03.2021
20.03.2021 DEF 10,000 Goods Retained on 24.03.2021
25.03.2021 PQR 22,000 Goods Retained on 28.03.2021
30.03.2021 XYZ 35,000 No information till 31.03.2021
You are required to prepare the following accounts in the books of ABC Limited:
(i) Goods on sale or return, sold and returned day books
(ii) Goods on sales or return total account (5 Marks)
(c) Max Chemical Works consigned 700 boxes of medicines to Raja Medical Stores at an
invoice price of ` 1,68,000 which was·20% above the actual cost price and paid ` 14,000
for Insurance and freight. In the course of transit, 50 boxes were lost and the transporter
paid ` 22,000 for the loss. The Consignee took the delivery of the remaining boxes and
incurred ` 9,750 for carriage. The Consignee sold 500 boxes for ` 1,60,000 and incurred
` 6,000 for selling expenses. The Consignee is entitled to a commission of 6% on gross
sales.
Show the Consignment Account. (10 Marks)
Question 4
(a) Karuna decided to start business of fashion garments under the name of M/s. Designer
Wear on 1st April, 2020. She had a saving of about ` 10,00,000. She invested ` 3,00,000
out of her savings and borrowed equal amount from bank. She purchased a commercial
space for ` 5,00,000 and further spent ` 1,00,000 on its renovation to make it ready for
business.
Loan and interest repaid by her in the first year are as follows:
30th June, 2020 - ` 15,000 principal+ ` 9,000 interest
30th September, 2020 - ` 15,000 principal+ ` 8,550 interest
31st December, 2020 - ` 15,000 principal+ ` 8,100 interest
31st March, 2021 - ` 15,000 principal+ ` 7,650 interest.
In view of further capital requirement, she transferred ` 2,00,000 from her saving bank
account to the bank account of the business. She paid security deposit of ` 7,000 for
telephone connection. Furniture of ` 10,000 was purchased, All payments were made by
cheque and all receipts in cash were deposited in the bank.
At the end of the year, her business showed the following results:
Particulars Amount Particulars Amount
Total Sales 20,00,000 Total Purchases 17,00,000
Electricity Expenses paid 40,000 Telephone Charges 50,000
Cartage Outwards 60,000 Travelling Expenses 45,000
Entertainment Expenses 5,000 Maintenance Expenses 25,000
Misc. Expenses 15,000 Electricity Expenses Payable 20,000
Other Information:
(i) She withdrew ` 5,000 by cheque each month for her personal expenses.
(ii) Depreciation on building @ 5% p.a. and oil furniture @ 10% p.a.
(iii) Closing stock in hand as on 31st March, 2021: ` 5,50,000
Prepare trading account, profit and loss account for the year ended 31-3-2021 and Balance
Sheet as on that date. (10 Marks)
(b) Summary of Receipts and Payments of AMA Society for the year ended 31st March, 2021
are as follows:
Receipts Amount Payments Amount
Subscription Received 5,00,000 Payment for Medicine Supply 3,00,000
Donation Raised for meeting 1,50,000 Honorarium to Doctors 1,00,000
revenue expenditure
Interest on Investments @ 90,000 Salaries 2,80,000
9% p.a.
Charity Show Collection 1,25,000 Sundry Expenses 10,000
Equipment Purchase 1,50,000
Charity Show Expenses 15,000
Additional Information:
Particulars 01.04.2020 31.03.2021
Subscription due 15,000 22,000
Subscription received in advance 12,000 7,000
Stock of medicine 1,00,000 1,50,000
Amount due for medicine supply 90,000 1,30,000
Value of equipment 2,10,000 3,00,000
Value of building 5,00,000 4'80 '000
Cash Balance 80,000 90,000
Opening Balance of Capital Fund 18,03,000
You are required to prepare:
(i) Income and Expenditure Account for the year ended 31st March, 2021.
(ii) Balance Sheet as on 31st March, 2021 (10 Marks)
Question 5
(a) From the following information prepare the Purchase. Book of Mis. Shyam & Company:
(i) Purchased from Red & Company on credit: