CA FOUNDATION

SUBJECT- ACCOUNT
Test Code – FJP 2409
(Date :)
(Marks - 100)
TOPIC : FULL COURSE PAPER

QUESTION : 1(A)

State with reasons whether the given statement is True or False

1. Part amount of entrance fees which is to be capitalized shall be disclosed in the income
and expenditure account.
2. In event of the dissolution of the firm, the business ceases to end. In event of
dissolution of the partnership, the partnership is reconstituted and the business is
continues.
3. Akash purchased a machine for Rs. 12,00,000. Estimated useful life is 10 years and
scrap value is Rs. 1,00,000. Depreciation for the first year using sum of the years digit
method shall be Rs. 2,00,000.
4. Raw Material Consumed = Opening inventory of Raw Materials + Purchases – Closing
inventory of Raw Materials.
(4 * 2 MARKS = 8)
QUESTION : 1(B)
Pass necessary Journal entries
2023 April
1. Mr. Vikas and Mrs. Vaibhavi who are husband and wife start consulting business by
bringing in their personal cash of Rs. 5,00,000 and Rs. 2,50,000 respectively.
10. Bought office furniture of Rs. 25,000 for cash. Bill No. - 2013/F/3
11.
Opened a current account with Punjab National Bank by depositing Rs. 1,00,000
15.
Paid office rent of Rs. 15,000 for the month by cheque to M/s Realtors Properties.
20.
Bought a motor car worth Rs. 4,50,000 from Millennium Motors by making a down
payment of Rs. 50,000 by cheque and the balance by taking a loan from HDFC Bank.
Voucher No. M/13/7
25
Vikas and Vaibhavi carried out a consulting assignment for Avon Pharmaceuticals and
raise a bill for Rs. 10,00,000 as consultancy fees. Bill No. B13/4/1 raised. Avon
Pharmaceuticals have immediately settled Rs. 2,50,000 by way of cheque and the
balance will be paid after 30 days. The cheque received is deposited into Bank.
30
Salary of one receptionist @ Rs. 5,000 per month and one officer @ Rs. 10,000 per
month. The salary for the current month is payable to them.

(4 MARKS)
 QUESTION: 1(C)
Prepare Returns Inward and Returns Outward Books from the transaction :
203
March 1 Mathur Bros., New Delhi, returned :
5 pairs of Shoes for being defective @ Rs. 500 per pair
Less : Trade Discount 10%
March 5 Returned to Kanpur Leather Private Ltd. Kanpur :
100 pairs of Chappals being not up to the approved sample @ Rs. 150 per pair
Less : Trade Discount 15%
March 12 Baluja Shoes Co., Delhi, returned 12 pairs of ladies chappals :
Rs. 200 per pair
Less: Trade Discount 10%
March 20 Returned to Bata Shoes Pvt. Ltd. Kolkata :
100 pairs B.S.C. Canvas Shoes @ 175 per pair
Less : Trade Discount 15%
March 24 Sethi Bros. Krishan Nagar, returned 10 pairs sandals :
@ Rs. 250 per pair

(4 MARKS)
QUESTION : 1(D)
A limited has the following balance on 1st April, 2003 :

Rs.
Machinery Account 2,00,000
Provision for Depreciation A/c Account 90,000

The company charged depreciation @ 10% p.a. on Straight Line Method. Accounts are
closed on 31st March every year. On 1st October, 2003 a part of machinery purchased on 1st
July, 2000 for Rs. 40,000 was sold for Rs. 18,400 and on the same date a new plant was for
Rs. 1,00,000.
Prepare ‘Machinery Account’ and ‘Provision for Depreciation Account’ for the year ended
2004.
(4 MARKS)
QUESTION : 2(A)
On 1st January, 2008, A sold goods to B for C Rs.1,00,000 received Rs.25,000 in cash and
drew two bills, first Rs.45,000 and second for Rs.30,000 of two months each. Both bills duly
accepted by B. First bill was endorsed to C in settlement of his account of Rs.45,000 and
second bill was discounted from the bank at the rate of 12% p.a. On the due date of these
bills, both bills were dishonoured. C has paid Rs. 100 and bank has paid Rs.80 as noting
charges.
Pass Journal entries in the books of A, B and C.
(10 MARKS)
QUESTION : 2(B)
From the following particulars, ascertain the bank balance as per Pass Book 31st March,
2015 (a) without correcting the Cash Book balance and (b) after correcting the Cash Book
balance:
(i) The bank balance as per Cash Book on 31st March, 2015 Rs. 40,000.
(ii) Cheques issued but not encashed up to 31st March, 2015 amounted to Rs.10,000.
(iii) Cheques paid into the bank, but not cleared up to 31st March, 2015 amounted to
Rs.15,000.
(iv) Interest on investments collected by the bank but not entered in the Cash Book
Rs.500.
(v) Cheques deposited in the bank but not entered in the Cash Book Rs.12,500.
(vi) Bank charges debited in the Pass Book but not entered in the Cash Book Rs.100.
(10 MARKS)

QUESTION : 3(A)
Correct the following errors found in the books of Mr. Dutt. The Trial Balance was out by Rs.
493 excess credit. The difference thus has been posted to a Suspense Account.
(a) An amount of Rs.100 was received from D. Das on 31st December, 2022 but has been
omitted to enter in the Cash Book.
(b) The total of Returns Inward Book for December has been casted short by Rs.100.
(c) The purchase of an office table costing Rs. 300 has been passed through the Purchases
Day Book.
(d) Rs. 375 paid for Wages to workmen for making show-cases had been charged to
“Wages Account”.
(e) A purchase of Rs. 67 had been posted to the trade payables’ account as Rs. 60.
(f) A cheque for Rs. 200 received from P. C. Joshi had been dishonoured and was passed
to the debit of “Allowances Account”.
(g) Rs. 1,000 paid for the purchase of a motor cycle for Mr. Dutt for his personal use had
been charged to “Miscellaneous Expenses Account”.
(h) Goods amounting to Rs.100 had been returned by customer and were taken into
inventory, but no entry in respect thereof, was made into the books.
(i) A sale of Rs. 200 to Singh & Co. was wrongly credited to their account. Entry was
correctly made in sales book.
(10 MARKS)
QUESTION : 3(B)
The Balance Sheet of a Partnership Firm M/s Alpha and Associates consisted of two partners
X and Y who were sharing Profits and Losses in the ratio of 5 : 3 respectively. The position as
on 31-03-2024 was as follows:
 Liabilities Rs. Assets Rs.
X's Capital 4,10,000 Land & Building 3,80,000
Y's Capital 3,30,000 Plant & Machinery 1,70,000
Profit & Loss A/c 1,12,000 Furniture 1,09,480
Trade Creditors 54,800 Stock 1,45,260
Sundry debtors 60,000
Cash at Bank. 42,060
9,06,800 9,06,800
On the above date, Z was admitted as a partner on the following terms:

th
(a) Z should get 1/5 of share of profits.
(b) Z brought Rs. 2,40,000 as his capital and Rs. 32,000 for his share of Goodwill.
Plant and Machinery would be depreciated by 15% and Land & Buildings would be
appreciated by 40%.
A provision for doubtful debts to be created at 5% on sundry debtors.
(c) An unrecorded liability of Rs. 6,000 for repairs to Buildings would be recorded in the
books of accounts.
(d) Immediately after Z’s admission, Goodwill brought by him would be adjusted among
old partners. Thereafter, the capital accounts of old partners would be adjusted
through the current accounts of partners in such a manner that the capital accounts
of all the partners would be in their profit sharing ratio.
Prepare Revaluation A/c, Capital Accounts of the partners, New profit sharing ratio and
Balance Sheet of the Firm after the admission of Z.
(10 MARKS)
QUESTION : 4(A)

Y. Ltd issued 20,000 shares of Rs. 10 each at premium of 20% per share.
Payables as following:
On Application Rs. 2 Per share
On Allotment Rs. 5 per share (including premium)
On First Call Rs. 3 per share
On Final Call Rs. 2 per share

Applications were received for 30,000 shares and pro-rata allotment was made to the
application for 24,000 shares. Any excess money paid on application was employed on
account of sum due on allotment.

Kamal, to whom 400 shares were allotted, failed to pay the allotment money and on
his subsequent failure to pay the first call his shares were forfeited.

Tamal, the holder of 600 shares, failed to pay the two calls, and his shares were
forfeited after the final call. Out of the shares forfeited, 800 shares were issued to Ramesh
Credited as fully paid for Rs. 9 per share, the whole of Kamal’s shares being included.

Pass the necessary journal entries to record the above transactions.

(10 MARKS)
QUESTION : 4(B)

The following is the trial balance of Mr. Pandit for the year ended 31st March, 2022:

Trial Balance as on 31st March 2022

Particulars Dr. Rs. Particulars Cr.Rs.

Opening Stock:

Raw Materials 1,50,000 Sundry Creditors 50,000

Finished goods 75,000 Purchase Returns 5,000

Purchase of Raw Materials 5,00,000 Capital 1,00,000

Land & Building 1,00,000 Bills Payable 24,000

Loose tools 30,000 Long-Term Loan 2,00,000

Plant & Machinery 30,000 Provision for Bad and 2,000

Doubtful Debts

Investments 25,000 Sales 8,50,000

Cash in Hand 20,000 Bank Overdraft 23,000

Cash at Bank 5,000

Furniture & Fixtures 15,000

Bills Receivable 15,000

Sundry Debtors 40,000

Drawings 20,000

Salaries 20,000

Coal and Fuel 15,000

Factory rent & rates 20,000

General Expenses 4,000

Advertisement 5,000

Sales Return 10,000

Bad Debts 4,000

Direct Wages (Factory) 80,000

Power 30,000

Interest Paid 7,000

 Discount Allowed 3,000

Carriage Inwards 15,00

Carriage Outwards 0
Commission Paid
7,00
0

9,00
0

12,54,00 12,54,00
0 0

Additional Information
Stock of finished goods at the end of the year Rs.1,00,000.
A provision for doubtful debts is to be created. at 5% on Sundry Debtors. Depreciation on
building Rs. 1,000 and Rs. 3,000 on Plant & Machinery to be provided.
Accrued commission of Rs. 12,500 is to be received for the year. Interest has accrued on
investment Rs. 15,000.
Salary Outstanding Rs. 2,000 and Prepaid Interest Rs. 1,500.
You are required to prepare Manufacturing, Trading and Profit and Loss Account for the year
ended 31st March, 2022.
(10 MARKS)
QUESTION : 5(A)
Libra Limited (a listed company) recently made a public issue in respect of which the
following information is available:
(a) No. of partly convertible debentures issued- 2,00,000; face value and issue price- Rs.
100 per debenture.
(b) Convertible portion per debenture- 60%, date of conversion- on expiry of 6 months
from the date of closing of issue.
(c) Date of closure of subscription lists- 1.5.2021, date of allotment- 1.6.2021, rate of
interest on debenture- 15% payable from the date of allotment, value of equity share
for the purpose of conversion- Rs. 60 (Face Value Rs. 10).
(d) No. of debentures applied for- 2,00,000.
(e) Interest payable on debentures half-yearly on 30th September and 31st March.
Write relevant journal entries for all transactions arising out of the above during the year
ended 31st March, 2022 (including cash and bank entries).
(10 MARKS)
QUESTION: 5(B)
Mr. A runs a business of readymade garments. He closes the books of accounts on 31st
March. The Balance Sheet as on 31st March, 2021 was as follows:

Liabilities Rs. Assets Rs.

A’s capital a/c 4,04,000 Furniture 40,000
Creditors 82,000 Stock 2,80,000
Debtors Cash 1,00,000
in hand Cash
28,000
at bank
38,000

4,86,000 4,86,000

You are furnished with the following information:

(1) His sales, for the year ended 31st March, 2022 were 20% higher than the sales of
previous year, out of which 20% sales was cash sales.
Total sales during the year 2020-21 were Rs. 5,00,000.

(2) Payments for all the purchases were made by cheques only.
(3) Goods were sold for cash and credit both. Credit customers pay be cheques only.
(4) Deprecation on furniture is to be charged 10% p.a.
(5) Mr. A sent to the bank the collection of the month at the last date of the each month
after paying salary of Rs. 2,000 to the clerk, office expenses Rs. 1,200 and
personal expenses Rs. 500.
Analysis of bank pass book for the year ending 31st March 2022 disclosed the following:

Rs.

Payment to creditors 3,00,000

Payment of rent up to 31st March, 2022 16,000

Cash deposited into the bank during the year 80,000

The following are the balances on 31st March, 2022:

Rs.

Stock 1,60,000

Debtors 1,20,000

Creditors for goods 1,46,000

On the evening of 31st March 2022, the cashier absconded with the available cash in the
cash book.

You are required to prepare Trading and Profit and Loss A/c for the year ended 31st March,
2022 and Balance Sheet as on that date. All the workings should form part of the answer.

(10 MARKS)
QUESTION : 6(A)
Calculate amount of subscriptions which will be treated as income for the year ended 31st
March, 2016 for each of the following cases :

Case Particulars Rs.

1. (i) Subscriptions collected during the year 2015 – 16 2,50,000

(ii) Subscriptions in arrears for the year 2015 – 16 6,000

(iii) Subscriptions received in advance for the year 2016 – 17 5,000

2. (i) Subscriptions collected during the year 2015 – 16 49,000

(ii) Subscriptions for the year 2015 – 16 collected in 2014 – 15 3,000

(iii) Subscriptions unpaid for the year 2015 – 16 2,000

3. (i) Subscriptions received during the year 2015 – 16 25,000

(ii) Subscriptions outstanding in the beginning of 2015 – 16 3,000

(iii) Subscriptions not yet collected for 2015 – 16 5,000

4. (i) Subscriptions received during the year 2015 – 16 80,000

(ii) Subscriptions outstanding in the beginning of 2015 – 16 5,000

(iii) Subscriptions not yet collected for 2015 – 16 8,000

5. (i) Subscriptions received during the year 2015 – 16 90,000

(ii) Subscriptions outstanding at the end of 2014 – 15 5,000

(iii) Subscriptions received in advance on 31st March 2015 3,000

(iv) Subscriptions received in advance on 31st March, 2015 4,000

(v) Subscriptions not yet collected for 2015 – 16 6,000

 (10 MARKS)

QUESTION : 6(B)
Write short notes on the following:
(i) Fundamental Accounting Assumptions.
(ii) Objectives of preparing Trial Balance.
(iii) Tangible Assets vs. Intangible Assets.
(iv) Liability of LLP and its Partners.
(v) Requirement to create Debenture Redemption Reserve.
(10 MARKS)