CONFEDERATION OF KERALA SAHODAYA COMPLEXES

COMMON MODEL TERM II EXAMINATION 2021-22

ACCOUNTANCY (055)- Marking Scheme (Set 2)
1 (i). When all the partners or all the partners except one become insolvent.
(ii) When the business of the firm becomes unlawful.
2. SUBSCRIPTION credited to I & E = 165000

Less: Outstanding for the year 2020-21 = (42000)

Add: outstanding subscription for 2019-20 = 35000

Add: advance for 21-22 = 12000

Less: advance in the previous year (7000)

Subscription debited to R & P = 163000

(1/2 mark for each step 4x ½ = 2)

3. George’s capital a/c Dr. 24,000

Suresh’s capital Dr 12,000;
To Sebastain’s capital a/c 36,000
---------------------------------------------------------------------------------
(i) P&L App. a/c Dr. 120,000;
To George’s capital a/c Cr. 85000;

To Suresh.’s capital a/c Cr. 35,000 (1+ 1= 2)

(DISTRIBUTION OF PROFIT IN THE GAINING RATIO 17:7)

4.(a) 4,80,000, (b) 31,20,000 (c ) 37,50,000.

OR
CREDITORS FOR MEDICINE ACCOUNT

By creditors in the 75000

To Opening advance 127000 beginning
To bank(paid during the 520000 By Purchases (Bal fig) ? 552000
year) By Advance (closing) 110000
To Closing creditors 90000

737000 737000
======== ========

Medicines consumed during the year to be debited to I & E =

190000+552000-50000-25000 = 6,67,000. Amount of discarded medicines
 will be deducted from medicines consumed and debited to Income &
Expenditure a/c as “Loss by damage”
5.

Bank a/c----Dr 20,00,000 Bank --- Dr 18,00,000

To 8% Debenture application 20,00,000 To Debenture Allotment 18,00,00
------------------------------------- ------------------------------------
Debenture application –Dr 20,00,000 Securities Premium ---Dr 3,00,000
To 8%Debentures Capital Reserve ---- Dr 2,00,000
20,00,000 Statement of profit &loss –Dr 1,00,00
-------------------------------------------- To Loss on issue of debentures
Debenture allotment – Dr 6,00,000
18,00,000 --------------------------------------
Loss on issue of Debentures Dr
6,00,000
To 8%Debentures 20,00,000
To Premium on redemption 4,00,000
-----------------------------------

OR

Method 1 : Bank a/c---Dr 45,00,000

To Bank Loan-45,00,000,
Debenture suspense –Dr 50,00,000
To Debentures-50,00,000
Method 2: No Journal Entry

Balance sheet
(i)Non Current liabilities. (ii) Non Current liabilities.
Long term Borrowings Long term Borrowings
HDFC Bank loan 45,00,000 HDFC Bank loan 45,00,000
(secured by 11% Debentures as collateral securities 11%Debenture 50,00,000
worth 50,00,000) Less debenture suspense 50,00,000 – NIL
---------------- --------------
4500000

6. (i) Kiran’s capital/c Dr 10000

To Gopan’s capital 10000
( adj entry for re valuation in the gaining ratio 1/5 :0 ) (1mark) ------------------
--------------------------------------------------------------------------------------
(ii) Kiran’s Capital/c Dr 6000
To Gopan’s Capital 6000
( adj entry for Gen reserve in the gaining ratio) (1mark)
-------------------------------------------------------------------------------------
(ii) Gopan’s capital a/c Dr 15000
To P&L Suspense a/c 15000
(share of loss) (1 Mark)
7. -------------------------------------------------------
(a) Realisation –Dr 1,45,000

To Bank 1,45,000 (d) Varun’s Capital --- Dr 20,000

------------------------------ To Bank 20,000

(b) Arun’s capital ---Dr 1,80,000 -----------------------------

To Realization 1,80,000 ( e ) Arun capital --- Dr 15,000

--------------------------------------- Varun capital ----Dr 15,000

(c ) Kiran’s Loan –Dr 2,00,000 Kiram capital ----Dr 15,000

To Realisation 1,85,000 To Realisation 45,000

To Bank 15,000

-----------------------------------

OR

Revaluation a/c-

Particulars Amount Particulars. Amount.

To Furniture 4,000 By Stock 1,900

To Land 6,000 By Machinery 3,300

To Provisions 1,700 By partners: Jain 3250

Gupta 1950

Malik 1,300 6,500

11,700 11,700
 Capital Accounts of partners

Particulars. Jain Gupta malik Particulars. Jain Gupta Malik

Jain’s capital 13,500 9,000 Balance b/d 40,000 60,000 20,000

Revaluation 3,250 1,950 1,300 Gupta’s cap 13,500

Bank 68,625 Malik’s cap 9,000

By Reserve 8,375 5,025 3,350

Balance c/d 90,750 40,500 By Bank 41,175 27,450

71,875 1,06,200 50,800 71,875 1,06,200 50,800

8. (a) No of debentures=45,00,000/150=30,000
(d) Machine ---Dr 50,00,000
To Vendor 50,00,000
--------------------------------------------------
Vendor----Dr 50,00,000
Loss on issue of debentures ------Dr 7,50,000
To Debenture 30,00,000
To Securities premium 15,00,000
To premium on redemption 7,50,000
To bank 5,00,000
( For consideration settled by issue of debentures & part payment)
-------------------------------------------------------------------------------------
Securities Premium -----Dr 7,50,000
To Loss on issue of debentures 750,000
(for loss written off)
--------------------------------------------------------
Loss on issue of debentures Account
Particulars. Amount Particulars Amount.

To premium on 7,50,000 By securities premium 7,50,000

redemption

7,50,000 7,50,000
9. Income & expenditure account for the year ending 31/3/21
Expenditure Amount Income Amount.

Rent 6000+1000 7000 Subscription83000-5000 +7000 85000

Salary 12000-2000 10,000 Interest on Investments 9,000

2000+7000
Postage 300 10,000
Profit on sale of investments
Electricity 6,000 200
Gain on sale of furniture
Help to needy students 22,000

SURPLUS. 58900

1,04,200 1,04,200

Balance sheet on 31/3/21

Liabilities Assets 31/3/21

Capital Fund 2,01,000 Cash 10,900

Add Surplus 58900 Bank 30,000

Life membership Books 3,000

5000
264900 Bonds 1,50,000

Advance Subscription Subscription outstanding 7,000

Rent Outstanding 3,000 Furniture 29,000

Investments 30,000

1,000 Salary advance 2,000

Interest on Bonds accrued 7,000

2,68,900 2,68,900
 PART B

10. 1. OPERATING 2. FINANCING 3. FINANCING 4. Operating (4 X ½ = 2)

11. Common size balance sheet of the company for the year ending 31/3/ 21

EQUITY & LIABILITIES. NOTE 31/3/20 31/3/21 % %

Shareholder’s Fund 25,00,000 40,00,000 45.45 50

Non-Current liabilities 1500,000 30,00,000 27.27 37.5

Current liabilities. 15,00,000 10,00,000 27.28 12.5

TOTAL 55,00,000 80,00,000 100 100

ASSETS :

Non-Current assets. 32,50,000 50,00,000 59.09 62.5

Current assets 22,50,000 30,00,000 40.91 37.5

55,00,000 80,00,000 100 100

OR

COMPARATIVE INCOME STATEMENT

Revenue from operation 20,00,000 40,00,000 20,00,000 100%

Purchase of stock in trade 12,00,000 24,00,000 12,00,000 100%

Change in inventories of stock in 2,40,000 6,00,000 3,60,000 150%

trade (% of purchase of stock in
trade)

Other expenses 1,60,000 2,00,000 40,000 25%

TOTAL EXPENSES 1600000 3200000 1600000 100%

 NET PROFIT 400000 800000 400000 100%

Tax 40% 160000 320000 160000 100%

Net profit after tax 240000 480000 240000 100%

12.
. Machinery account
Particulars Amount Particulars. Amount
To balance b/d 10,00,000 By Depreciation Provision 45,000
To Bank -purchase 11,50,000 By Bank 1,35,000
By Profit & Loss a/c 1,20,000
By Balance c/d 18,50,000

21,50,000 21,50,000
.
ACCUMULATED DEPRECIATION A/C
Particulars Amount Particulars. Amount
To Machinery a/c 45,000 By Balance b/d 1,00,000
To balance c/d 2,50,000 By Profit & loss 1,95,000

2,95,000 2,95,000

Net Profit before tax and EoI:

Statement of profit & Loss 1,00,000
Add Taxation provision – 80,000
1,80,000
========
Cash flow statement for the year ending 31st March 2021:
Particulars Amount Amount.

Net Profit Before Tax & EoI 1,80,000

ADD : Non Cash Non-Operating items : Depreciation 1,95,000
Loss on sale of machine 1,20,000
Goodwill written off 60,000
 OPERATING PROFIT BEFORE WORKING CAPITAL 5,55,000
CAHNGES.
ADD :Decrease in current assets and Increase in current 40,000
liabilities: Trade Payables
LESS : Increase in current assets & Decrease in current (50,000)
liabilities. Inventory (2,00,000)
Trade Receivables 3,45,000
CASH FROM OPERATING ACTIVITIES BEFORE TAX
LESS Tax paid 60,000

CASH GENERATED FROM OPERATING ACTIVITIES 2,85,000

INVESTING ACTIVITIES
Cash Inflow from sale of machine
Purchase of machines
NET CASH USED IN INVESTING ACTIVITIES. (10,15,000)
FINANCING ACTIVITIES.
Inflows from issue of share capital 135,000
Loans taken (11,50,000)
NET CASH INFLOW FROM FINANCING ACTIVITIES. 7,60,000
NET INCREASE IN CASH & CASH EQUIVALENTS. 30,000
ADD OPENING CASH EQUIVALENTS
60,000
CLOSING CASH & CASH EQUIVALENTS. 4,00,000

3,60,000 90,000