Questions for thePRACTICE

ACCOUNTANCY weak studentsQUESTIONS

1. Prepare Common Size Statement of Profit and Loss from the following informations:-

Particulars 2021-22(Rs.) 2022-23(Rs.)

Revenue from Operations 4,00,000 6,00,000

Employees Benefit Expenses 20% of R.F.O. 30% of R.F.O.
Other Income 1,00,000 1,50,000
Finance Cost 50,000 60,000
Tax Rate 50% 50%

2. Prepare Comparative Statement of Profit and Loss from the following informations:-

Particulars 2022-23(Rs.) 2021-22(Rs.)

Cost of Revenue from Operations 10,00,000 8,00,000

Revenue from Operations 250% of Cost of R.F.O. 300% of Cost of R.F.O.
Purchase of Inventory 12,00,000 11,00,000
Other Expenses 25% of R.F.O. 15% of R.F.O.
Tax Rate 50% 50%

3. X and Y are partners sharing profits and losses in 3:2. Z is admitted with 1/5 th share in the profits
which he acquired from X only. He brings Rs.4,00,000 as capital and Rs.1,00,000 as his share of
goodwill in cash. Goodwill already appears in the books amounted to Rs.60,000. Pass necessary
journal entries.

4. A and B are partners sharing profits and losses in 3:1. C is admitted with 1/5 th share in the profits.
He brings Rs.2,00,000 as capital and Rs.60,000 as his share of goodwill in cash. Goodwill already
appears in the books amounted to Rs.40,000. New profit sharing ratio will be 2:2:1. Pass necessary
journal entries.

5. X,Y and Z were partners sharing profits in 4:3:2. Z retires and his share is taken over by X and Y
equally. At that time, Goodwill of the firm is valued at Rs.3,60,000. The Balance Sheet showed
goodwill in the books amounted to Rs.90,000. Pass necessary journal entries.

6. P,Q and R were partners sharing profits in 5:3:2. R decided to retire form the firm and at that
time, Goodwill of the firm is valued at Rs.4,00,000. The Balance Sheet showed goodwill in the
books amounted to Rs.1,00,000. New profit sharing ratio will be 2:1. Pass necessary journal
entries.

7. X,Y and Z were partners sharing profits in 3:3:2. Z died on 31 st August 2022. His share of profit till
the date of death is to be calculated on the basis of average profits of last four years. The profits for
the last four years were :- 2018-19 Rs.4,00,000 ; 2019-20 Rs.3,00,000 ; 2020-21 Rs.4,50,000 ; 2021-
22 Rs.3,50,000. Pass journal entry for the share of profit of Z.

8. A,B and C were equal partners. A died on 30th June 2022. His share of profit till the date of death
is to be calculated on the basis of sales. Sales for the accounting year were Rs.10,00,000 and profits
 to be Rs.3,00,000. Sales from 1st April to 30th June 2022 were Rs.4,00,000. Pass journal entry for
the share of profit of A.

9. Ram, Shyam and Gopal were partners sharing profits in 2:3:5. Ram died on 31 st October 2023. His
share of profit till the date of death is to be calculated on the basis of last year’s profit. The profits
for the last four years were :- 2018-19 Rs.4,00,000 ; 2019-20 Rs.3,00,000 ; 2020-21 Rs.2,00,000 ;
2021-22 Rs.3,00,000 ; 2022-23 Rs.2,50,000. Goodwill is to be valued at 3 years purchase of Average
Profits for last five years. Pass necessary journal entries.

10. X and Y are partners sharing profits and losses in 2:3. They decided to dissolve the firm. The
assets and liabilities have been transferred to Realisation Account. Pass journal entries from the
following transactions:-
a) Furniture (book value Rs.40,000) was taken over by X at 5% discount.
b) Bank loan of Rs.1,00,000 was paid .
c) X has promised to pay his wife’s loan of Rs.80,000.
d) Creditors of Rs.12,000 took over furniture of Rs.10,00 in full settlement of his account.
e) Goodwill of Rs.15,000 was sold for Rs.12,000.
f) Bills Payable of Rs.10,000 was paid by Y at 10% discount.
g) Building of Rs.3,00,000 was sold for Rs.2,00,000.
h) Profit and Loss Account showed balance of Rs.40,000.
i) Loss on realization amounted to Rs.10,000.
j) Debtors of Rs.20,000 were realized at Rs.13,000.

11. A firm has an average profits of Rs.1,00,000. Normal rate of returns is 10% p.a. Bad debts
Written off Rs.10,000 remained unadjusted. Calculate goodwill on the basis of three years
purchase of super profit.

12. A firm has profits and losses for the years :- 2021-22 Rs.2,00,000 ; 2022-23 Rs.3,00,000 ; 2023-24
Rs.1,00,000. Total Assets Rs.10,00,000 and Creditors Rs.1,50,000. Rate of returns is 15% p.a.
Calculate goodwill on the basis of three years purchase of super profit.

13. Calculate goodwill on the basis of twice the average profits of last three years:-

(Rs.)
2019-20 4,00,000(including abnormal gain of Rs.50,000)
2020-21 2,50,000(after charging abnormal loss Rs.1,00,000)
2021-22 2,00,000

14. X,Y and Z are partners sharing profits and losses in 2:2:1. Their capitals are Rs.3,00,000 ;
Rs.3,50,000 and Rs.2,00,000 respectively. Total assets amounted to Rs.10,00,000 and creditors
Rs.1,50,000. Rate of returns is 10%.p.a. The firm has profits for last three years

were Rs.3,00,000 ; Rs.2,50,000 and Rs.2,00,000. Calculate goodwill on the basis of capitalization of
super profit.:-

15. X, Y and Z are partners sharing profits and losses in 5:3:2. From 1 st April 2023, they decided to
share profits in 2:2:1. Goodwill of the firm is valued at Rs.4,00,000. General Reserve amounted to
Rs.1,00,000. Profit and Loss Account showed balance Rs.1,50,000. Pass an adjustment entry.
16. A, B and C are partners sharing profits in 2:2:1. They decided to share future profits in 1:1:1. At
that time, Goodwill of the firm is valued at Rs.1,50,000. Advertisement Suspense amounted to
Rs.1,00,000. Debit balance of profit and loss account amounted to Rs.1,70,000. You are required to
pass an adjustment entry.

17. X and Y are partners sharing profits and losses in 3:2. On April 1 2023, they will share profits in
2:1. Dr. balance of profits and losses amounted to Rs.1,50,000. Pass journal entry to show the
effect of new ratio.

18. X ltd. forfeited 2,000 shares of Rs.100 each due to non-payment of allotment of Rs.50 ; Rs.20 on
first call and Rs.10 on final call. 1,200 forfeited shares were reissued at Rs.85 per share fully paid.
Pass necessary journal entries.

19. Company forfeited 4,000 shares of Rs.100 each (Rs.80 called up) due to non-payment of allotment
of Rs.50 per share and Rs.15 per share on first call. 2,800 forfeited shares were reissued at Rs.70
per share. Pass necessary journal entries.

20. Company forfeited 6,000 shares of Rs.10 each (Rs.7 called up) which were issued at premium of
Rs.2 per share, due to non-payment of Rs.6 allotment. 4,200 forfeited shares were issued at Rs.8
per share. Pass necessary journal entries.

21. X, who has 200 shares of Rs.10 each, which were issued at premium of 20%. He has paid
application Rs.2 per share, Rs.4 per share allotment (Rs.1 premium) and first call Rs.2 per share.
120 forfeited shares were reissued at Rs.13 per share fully paid. Pass necessary journal entries.

22. X ltd. purchased assets of Rs.15,00,000 and liabilities of Rs.3,00,000 from Y ltd. at Rs.10,00,000.
40% of the amount was paid by cheque and for the balance, equity shares of Rs.10 each at a
premium of 20%. Pass necessary journal entries.

23. Rahil ltd. purchased assets of Rs.12,50,000 and liabilities of Rs.2,50,000 from Pankaj ltd. 30% of he
amount was paid by cheque and for the balance, 10% preference shares of Rs.100 each were issued
at a premium of 25%. Pass necessary journal entries.

24. X ltd. bough machinery of Rs.18,00,000 from Kapil ltd. 25%of the amount was paid by cheque and
for the balance, 10% debentures of Rs,100 each were issued at a discount of 10%. Pass necessary
journal entries.

25. PQR ltd. purchased running business of RK ltd. at Rs.18,00,000. It includes the following:-
Plant Rs.4,00,000 ; Machinery Rs.6,00,000 ; Inventory Rs.3,00,000 ; Creditors Rs.2,00,000 ;
Debtors Rs.1,50,000 and Furniture Rs.3,00,000.
It was issued8% debentures of Rs.100 each at par. Pass necessary journal entries.

26. X ltd. issued 10,000, 10% debentures of Rs.100 each at a premium of 10% redeemable at 8%
premium. Pass necessary journal entries.

27. X ltd. issued Rs.10,00,000, 10% debentures of Rs.100 each at a premium of 6% redeemable at par.
Pass necessary journal entries.
28. X ltd. issued 6,000, 5% debentures of Rs.60 each at a discount of 10% redeemable at 6% premium.
Pass necessary journal entries.

29. X ltd. issued 7,000, 8% debentures of Rs.50 each at a discount of 4% redeemable at par. Pass
necessary journal entries.

30. X ltd. issued 10,000. 10% debentures of Rs.100 each at par redeemable at par. Pass necessary
journal entries.

31. On 1st April, 2023, Company issued 10% debentures of Rs.10,00,000 at maximum discount
redeemable at 6% premium after 10 years. Interest is payable on 30 th Sept. and 31st March every
year. Pass necessary journal entries.

32. On 1st April, 2022, Company issued 6%, 10,000 debentures of Rs.100 each at premium of 8%
redeemable at 10% premium after 20 years. Interest is payable annually. Pass necessary journal
entries.

33. On 1st April, 2022, Company took a loan of Rs.5,00,000 from PNB against issue of 6,000, 10%
debentures of Rs.100 each as a collateral security.
a) Pass journal entries and show the above items in the Balance Sheet of a Company.
b) How to show above items in the Balance Sheet of a Company.

34. On 1st April, 2021, Company issued 10% debentures of Rs.10,00,000 at a discount of 5%
redeemable at 6% premium. Pass necessary journal entries to write off the loss on issue of
debentures.
35. Company is registered with capital of Rs.5,00,00,000 divided into equity shares of Rs.100 each. It
issued 2,00,000 shares to the public for the subscription. The public applied for 2,30,000 shares of
which excess shares were rejected and money was refunded. One shareholder, having 10,000
shares did not pay call money of Rs.30 per share. Show the Share Capital in the Balance Sheet of a
Company.

36. Company is registered with capital of Rs.5,00,00,000 divided into equity shares of Rs.100 each. It
issued 3,00,000 shares to the public for the subscription. The public applied for 2,90,000 shares.
One shareholder, having 15,000 shares did not pay call money of Rs.25 per share. These shares
were forfeited. Show the Share Capital in the Balance Sheet of a Company.

37. Current Ratio 3:1 and Quick Ratio 1:1. Find the value of Current Assets and Quick Assets, if the
value of Inventory is Rs.40,000.

38. Current Ratio 3:1 and Working Capital is Rs.4,00,000. Find the value of Current Assets.

39. Under which major and sub head of Balance Sheet of a Company following items will be shown:

a) Loose Tools g) Securities Premium

b) Bank Loan ( 5 month maturity) h) Creditors
c) 10% Debentures i) 10% Preference Share Capital
d) Machinery j) Bank Overdraft
 e) Goodwill k) Statement of Profit and Loss
f) Stores and Spares l) Cash in Hand

40. Balance Sheet of A and B, who share profits and losses in 3:2 as on 31 st December 2023 as under :-
Liabilities Rs. Assets Rs.

Capital Accounts :- Furniture 1,00,000

A 4,00,000 10,00,000 Land 6,00,000
B 6,00,000 2,00,000 Machinery 2,00,000
Creditors 4,00,000 Debtors 4,10,000
General Reserves 80,000 Less : provision 10,000 4,00,000
Bills Payable 1,20,000 Furniture 3,00,000
Profits and Losses Account Stock 1,50,000
Goodwill 50,000

18,00,000 18,00,000

C is admitted with 1/5th share in the profit which he acquires from A only with the
following adjustments:-
1. He brings proportionate capital & Rs.60,000 as goodwill. Half of this withdrawn by partners.
2. Machinery is revalued at Rs.185,000.
3. Furniture was overvalued by Rs.15,000
4. Land is to be appreciated by 10%.
5. Maintain provision for doubtful debts @ 2% on debtors.
6. Half of the stock to be taken over by A and B equally and remaining revalued at Rs.80,000.
Prepare Revaluation Account ; Partner’s Capital Account

41. Balance Sheet of X , Y and Z ,who share profits and losses in 4:3:3 as on 31 st December 2023 as
under :-
Liabilities Rs. Assets Rs.

Capital Accounts :- Bank 10,000

X 4,00,000 Plant and Machinery 4,00,000
Y 3,,00,000 furniture 90,000
Z 2,00,000 9,00,000 Building 6,00,000
Creditors 1,00,000 Debtors 1,50,000
Bank overdraft 1,50,000 Less : provision 10,000 1,40,000
Bills Payable 50,000 Stock 1,60,000
Profits and Losses Account 3,00,000 Goodwill 1,00,000

15,00,000 15,00,000

W is admitted in the firm.

1. He will bring Rs.1,50,000 as capital and nothing for goodwill.
2. Goodwill of he firm is valued at Rs.3,00,000.
3. Plant & Machinery be depreciated by 10% and Building be appreciated by 20%.
4. Debtors are all good.
5. Stock is increased up to Rs.1,70,000 and furniture is reduced to Rs.70,000.
6. Capitals of the partners be adjusted on the basis of W’s capital and new profit sharing ratio
will be 4:3:2:1.
Prepare Revaluation Account; Partner’s Capital Account and Balance Sheet after W’s Admission.
42. The Balance Sheet of Arun anb Varun, who share profits and losses in 3:2, as on 31-12-2022 :-
Liabilities Rs. Assets Rs.

Capital Accounts :- Land 1,00,000

Arun 1,00,000
Varun 2,00,000 3,00,000
Creditors 40,000 Plant and Machinery 1,50,000

Mrs. Arun’s Loan 10,000 Stock 50,000

General Reserve 40.000 Debtors 50,000 49,000

Less: prov. 1.000
Varun’s Loan 39,000 Furniture 30,000

Workmen Compensation 25,000 Investments 40,000

Fund
Investment fluctuation 10,000 Profit and loss A/c 65,000
fund
Bank Loan 40,000 Cash at bank 25,000

Total 5,04,000 Total 5,04,000

the firm has been dissolved on the following adjustments :-

1. Arun agreed to pay his wife’s loan and took stock at 10% discount.
2. Furniture was sold to Varun at Rs.28,000.
3. Other assets realised :- half of the debtors at 5% discount ; Investments at Rs.1,000 less ; Plant
and Machinery at 10% more than book value and Land at Rs.1,20,000.
4. Creditors of Rs.10,000 were not traceable and balance were paid at 10% discount.
5. Arun was to bear all the expenses on realisation for which he was paid Rs.2,000. Actual
expenses amounted to Rs.2,500.
Prepare Realisation Account .
43. A, B and C were partners in a firm sharing profits and losses in 4:3:3. Their Balance Sheet as on
31-03-2022 as under :-
Liabilities Rs. Assets Rs.

Creditors 40,000 Cash in hand 25,000

Mrs. A’s Loan 50,000 Plant 65,000

B’s Loan 45,000 Motor Van 28,000

C’s Loan 38,000 Debtors 41,000 36,000

Less: prov. 5,000
General Reserve 82,000 Investment 34,000

Employees Provident 18,000 Stock 24,000

Fund
Bank Overdraft 10,000

Depreciation Reserve 5,000 Building 1,02,000

Bills Payable 32.000 Deferred Revenue 6,000

Expenses
Total 3,20,000 Total 3,20,000
 They decided to dissolve the firm on 01-04-2022 and C was appointed to realise the assets and
liabilities of the firm for which he is to receive commission of Rs.5,000 and to bear all the
expenses of realisation.
a) A took over half of the Investment at a profit of 10% and remaining realised at 5% less.
b) Creditors were settled at 90%.
c) Bank agreed to take over stock to discharge of overdraft.
d) Other assets realised :- Building Rs.1,10,000 ; Debtors at 10% more ; Plant at book value.
e) Motor Van was taken over by C at price 10% less than the book value.
f) Bills Payable were paid at 15% discount and Mrs. A’s Loan was paid by A.
g) The cost of winding up amounted to Rs.5,500.
Prepare Realisation Account .

44. A,B and C are partners in a firm sharing profits and losses in 5:3:2. Their Balance Sheet as on 31-
03-2023 was as under :-
Liabilities Rs. Assets Rs.

Capital Accounts :- Cash 15,000

A 1,00,000 Land 1,25,000
B 80,000 Furniture 45,000
C 60,000 2,40,000 Stock 35,000
General Reserve 45,000 Debtors 60,000
Profits and Losses 40,000 Machinery 40,000
Sundry Creditors 20,000 Goodwill 40,00
Bills payable 10,000 Advertisement Suspense 10,000
Workmen Compensation 15,000
Fund

3,70,000 3,70,000

C decided to retire from the firm with the following adjustments :-

1. Goodwill of the firm is valued at Rs.2,40,000 and C’s share is adjusted in profit sharing ratio.
2. Stock is depreciated by Rs.4,000 and furniture is reduced to Rs.30,500.
3. Create provision for doubtful debts @ 10% on debtors.
4. Land is revalued at Rs.1,10,000.
5. The claim on W.C.F. is determined as Rs.20,000.
6. Creditors of Rs.2,500 were to be written back.
7. Rs.30,000 was paid to C and balance transferred to his loss account.
8. The capitals of the remaining partners are to be adjusted in the profit sharing ratio by opening
current account.
Prepare Revaluation Account ; Partner’s Capital Account.

45. Arti , Bharti and Seema are partners sharing profits in the proportion of 3:2:1 and their Balance
Sheet on March 31 , 2022 stood as follows
Liabilities Amount(Rs.) Assets Amount(Rs.)
Bills Payable 12,000 Buildings 21,000
Creditors 14,000 Cash in Hand 12,000
General Reserve 12,000 Bank 13,700
Capitals : Debtors 12,000
Arti 20,000 Bills Receivable 4,300
Bharti 12,000 Stock 1,750
 Seema 8,000 40,000 Investment 13,250
78,000 78,000
Bharti died on June 12, 2022 and according to the deed of the said partnership her executors are
entitled to be paid as under:
(i) The capital to her credit at the time of her death and interest thereon @ 10% per annum.
(ii) Her proportionate share of Reserve Fund .
(iii) Her share of profits for the intervening period will be based on the sales during that period,
which were calculated as Rs.1,00,000. The rate of profit during past three years had been
10% on sales.
(iv) Goodwill of the firm is valued at Rs.4,00,000.
Prepare Bharti’s Capital Account

46. X, Y and Z are partners sharing profits and losses in 3:2:1. Their capitals are Rs.5,00,000 ;
Rs.3,00,000 ; Rs.4,00,000 respectively. Their drawings were Rs.1,20,000 ; Rs.1,30,000 ;Rs.1,40,000
respectively during the year. The deed provides the following:-
a) Rate of interest on capital is 10% p.a.
b) Rate of interest on drawings is 6% p.a.
c) X advanced a loan of Rs.1,20,000 on 30 th Sept. 2022 carrying interest @ 12% p.a.
d) Salary of X is Rs.10,000 p.m.
e) Y is get a bonus of Rs.60,000.
f) Z is to get a commission of 10% on net profit after charging interest on capital.
The profit for the year ended 31st March 2023 was amounted to Rs.10,00,000.
Prepare Profit and Loss Appropriation Account; Partner’s Capital Account.

47. A, B and C are partners sharing profits and losses in 2:2:1. Their capitals are Rs.3,00,000 ;
Rs.2,00,000 and Rs.3,00,000 respectively. They have drawn Rs.1,20,000 each for personal use.
Balance in Current Account:- A Rs.12,000 (Cr.) ; B Rs.15,000 ; C Rs.10,000 (Dr.). The partnership
deed provides the following :-
a) Rate of interest on capital is 8% p.a.
b) Rate of interest on drawings is 5%.
c) B is get salary of Rs.12,000 per quarter.
d) Manager is to get a commission of 20% on net profit after charging his commission.
The profit for the year ended 31st March 2023 was amounted to Rs.8,00,000.
Prepare Profit and Loss Appropriation Account; Partner’s Capital Account ; Partner’s Current
Account.
48. A, B and C are partners sharing profits and losses in 4:2:3. Their capitals are Rs.3,00,000 ;
Rs.2,00,000 and Rs.3,00,000 respectively. The partnership deed provides the following :-
a) Interest on capital is 10% p.a.
b) Salary of A is Rs.10,000 p.m. and B is Rs.5,000 p.m.
c) C is to get bonus of Rs.50,000
d) A is given a guarantee of minimum profit of Rs.1,50,000.
The profit for the year ended 31st March 2023 was mounted to Rs.6,00,000.
Prepare Profit and loss Appropriation Account.
49. X and Y are partners sharing profits in 3:2. Their capitals are Rs.4,00,000 and Rs.5,00,000
respectively. Rate of interest on capital is 10% p.a. the profit for the year amounted to Rs.72,000.
Show the distribution of Profit in each of the following cases:-
a) Interest on capital is provided.
b) Interest on capital is taken as a charge.
c) X and Y are partners sharing profits and losses in the ratio of 3 : 2. Their capital accounts
showed balances of Rs.1,50,000 and Rs.2,00,000 respectively on Jan 01, 2023.
50. Show the treatment of interest on capital for the year ending December 31, 2024 in each of the
following alternatives:
(a) If the partnership deed is silent as to the payment of interest on capital and the profit for the
year is Rs.50,000;
(b) If partnership deed provides for interest on capital @ 8% p.a. and the firm incurred a loss of
Rs.10,000 during the year;
(c) If partnership deed provides for interest on capital @ 8% p.a. and the firm earned a profit of
Rs.50,000 during the year;
(d) If the partnership deed provides for interest on capital @ 8% p.a. and the firm earned a profit of
Rs.14,000 during the year.
51. Amit withdrew Rs.6,000 in the beginning of every month for 7 months. Calculate interest on
drawings @ 6% p.a.
52. Sajan withdrew Rs.7,500 at the end of every month for the first 9 months. Calculate interest on
drawings @ 10% p.a.
53. Agam withdrew Rs.7,000 in the beginning of every month for 6 months. Calculate interest on
drawings @ 10%.
54. Wicket withdrew Rs.8,000 in the beginning of every quarter starting from 1st July, 2020. Calculate
interest on drawings @ 6% p.a., if accounts were closed on 31 st December every year.
55. Yatharth withdrew Rs.7,800 at the end of every quarter. Calculate interest on drawings @ 12%
p.a.
56. Xavier withdrew some amount in the beginning of every month for 8 months. Calculate the
amount of monthly drawings, if rate of interest is 6% p.a. and amount of interest on drawings is
amounted to Rs.900.
57. Brihul withdrew Rs.7,000 on 31st Aug.2021 ; Rs.12,000 on 1st Oct. ; Rs,15,000 on 1st Dec. ;
Rs.25,000 on 28th Feb. Calculate interest on drawings @ 12% p.a., if accounts were closed on 31 st
March every year.
58. X and Y are partners sharing profits and losses in 3:2. Their capitals are Rs.4,00,000 and
Rs.5,00,000 respectively. On 30th Sept. 2022, they decided that their capitals should be Rs.4,50,000
each. Calculate interest on capital @ 10% p.a., if accounts were closed on 31 st March every year.
59. X, Y and Z are partners sharing profits and losses in 5:3:2. Their capitals are Rs.6,00,000 ; Rs.5,00,000 and
Rs.4,00,000 respectively. Later on it was discovered that interest on capital @ 10% p.a. has been omitted.
Pass an adjustment entry.
60. Anil and Sunil are partners sharing profits in 3:1. Their drawings were Rs.80,000 and Rs.1,00,000
respectively. Interest on drawings @ 10% p.a. had not been charged. You are required to pass an adjustment
entry.