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Academic Year: 2019-2020 r-
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Program: BBA Year: I
Subject: Financial Accounting Batch: 2019-22
Date: 25th November, 2019 Time: 9.30 am -11.30 am (2 hrs)
Marks: 50 No. of Pages:i
Final Examination
Instruction:-
1. All questions are compulsory.
2. Figures to the right indicate full marks.
3. Basic and Scientific calculators are allowed.
4. Make suitable assumptions wherever necessary.
5. Working Notes should form part of the answer.
compulsory
Following particulars were furnished by Pioneer Ltd., a trading concern as on 20
31.03.2018:
(Figures in `000)
Particulars Debit Particulars Credit
Equity Capital (Shares of Rs,10
Land at Cost 420 550
each)
Plant & Machinery at cost 1,540 10% Debentures 400
Trade Receivable 48 Provision for Depreciation 430
Opening Stock 20 Profit & Loss A/c 80
Purchases 772 Securities premium 140
Factory Expenses 12 Sales 1,200
Salaries 60 Bills payable 60
Marketing & Selling Expenses 30 Suspense Account 10
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Interim Dividend Paid General Reserve
Bank Rent
Additional Information:
i. Authorized Share Capital is 70,000 shares of Rs.10 each. Issued and Subscribed
shares were of the same amount.
ii. Declared & paid final dividend at 10%.
iii. Suspense of Rs.10,000 represents cash received for sale of some of the machinery
on 01.04.2017. The cost of the machinery was Rs. 20,000 and the accumulated
depreciation on it being Rs.12,000. The balance in cash account is correct, and the
entry for disposal has not been made.
iv. Depreciation to be provided on plant and machinery at 10% on cost.
v. There is a disputed case going on in court for payment to Employees Provident
Fund Account of Rs. 25,000. The outcome is not known, and the lawyer believes
that there is 50% chance of winning the case.
vi. Provision for Bad & Doubtful Debt is to be maintained at 5% of closing debtors.
vii. During the year there were bad debts amounting to Rs.1000.
viii. Closing Inventory is Rs.1,06,000.
Prepare Pioneer Ltd's. Balance Sheet as on 31 St March 2018 and Statement of Profit &
Loss Account with relevant notes to accounts as required by Schedule Ill of the
Companies Act. Ignore previous years' figures and taxation.
15
From the following balances extracted from the books of Max Ltd., prepare
Departmental Trading Account, Departmental Profit and Loss Account and General
Profit and Loss Account for the year ended 31 St March, 2019 after adjusting the
unrealised departmental profits, if any.
Department Department
Total(Rs.)
Particulars X Y
(Rs.) (Rs.) .
2/5-
Stock (1 St Apr 2018) 2,70,000 3,60,000
--`.
Purchases 45,00,000 60,00,000
Sales including transfers 250,00,000
Salaries 80,00,000
General Expenses 2,00,000
Carriage inward 1,40,000
Carriage outward 2,50,000
ages 13,20,000
Rent 3,00,000
Interest on Bank Loan 50,000
75,000
Electricity
Discount received 70,000
Furniture 20,00,000 25,00,000
Insurance 1,00,000
Additional information:
Department Department
Particulars
X Y
i) No. of workers 40 70
ii) No. of employees 48 80
Space occupied (in
iii)
20,000 40,000
sq,ft.)
iv) Sales of department Y is 50% more than that of Department X and sales includes
interdepartmentaltransfers,
v) Closing Stock of Department X is Rs.3,10,000, including goods from Department Y of
Rs.80,000 and Closing Stock of Department Y is Rs. 5,30,000, including goods from
Department X of Rs.1,20,000, Both closing stock are at usual selling price of transferor d
epartment.
vi) Sales of Department X includes transfer of goods to Department Y of value
Rs.9,00,000 and Sales of Department Y include transfer of goods to Department X of
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value Rs.13,50,OOO. Both sales are at usual selling price of transferor department. .
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vii) Opening Stocks of Department X & Department Y include goods of value Rs.40,000
and Rs.67,500 taken from Department Y and Department X respectively at usual selling
price of transferor department,
viii) Assume Gross Profit percentage remains same for all the
years.
ix) Depreciate furniture by 10% p.a.
x) Insurance Premium is for a comprehensive policy, allocation being inconvenient.
Metropol Ltd. acquired a machinery for Rs. 5,00,000 on 1 St April 2009. Rs. 40,000 were 10
given as wages for its installation. A similar machine was available !n the market at Rs.
4,00,000. Depreciation was to be charged at 20% p.a. on SLM basis.
On 1 St April, 2011 a modification was made to machinery to improve its technical
efficiency at a cost of Rs, 50,000 which it was considered would extend the useful life by
two years. At the same time, the machine was painted at cost of Rs.10,000 so that it
looks new,
Routine machine maintenance during the year ending 31St March 2012 is Rs.7,500.
A. Show for the year ending 31 St March 2012:
7 Marks
i. Machine Account
ii. Provision for Depreciation
iii. Relevant portions of P&L Account showing revenue charge relating to machine
account.
iv. Working note should form part of Solution
8. Give explanation why respective amounts were capitalized or expensed out in Profit
and Loss A/c: 3 Marks
i. Rs. 5,00,000
ii. Rs.40,000
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iii.a,s-,4,00,000
--, iv. Rs.50,000
v. Rs.10,000
vi. Rs.7,500
4 (a) Explain in brief objective and advantages of setting Accounting standards. (3)
(b) Explain capital receipts and give an example. (2)
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