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Financial Accounting: [For B.com 1st Sem CCF] [2023-24]

S.no. Chapters Pg. no.

1. Final Account [Imp] [15 Marks] 01-08

2. Depreciation [Imp] [10 Marks] 09-11

3. Sectional and Self Balancing Ledger [Imp] [10 Marks] 12-16

4. Single Entry [Imp] [10-15 Marks ] 17-25

5. Rectification Of Errors [Imp] [5-10 Marks] 26-30

6. Sales On Approval [Imp] [5 Marks] 31-32

7. Introduction (Practical) [Imp] [5 Marks] 33-35

8. Introduction (Theory) [Imp] [5+5=10 Marks] 36

9. Not for Profit Organization [Imp] [10-15 Marks] 37-44

10. Inventory Valuation [Imp] [5-10 Marks] 45-47

11. Provision for Doubtful Debt [10 Marks] 48-49

12. Capital & Revenue Expenditure [5 Marks] 49

13. Adjustment Entries [5 Marks] —

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Final Account [Approx 15 Marks]
1. The following is the Trial Balance of Mr. Roy as on 31st March, 2019:
Debit Balance ₹ Credit Balance ₹
Plant and Machinery 3,10,000 Capital 4,20,000
Opening Stock 30.000 Sundry Creditors 20,000
Sundry Debtors 40,000 Sales 2,10,000
Wages 10,000 Return Outward 20,000
Salaries 15,000 Provision for Doubtful Debt 1,000

Rent (April 2018 to June 2019) 18,000 Interest 4,000

Purchases 1,50,000 F
Return Inward 10,000
Bad debt 9,000
Insurance 3,000
Office Expenses 5,000
Cash in hand 30,000
Cash at Bank 45,000
6,75,000 6,75,000
Additional Information:
(i) Stock on 31st March, 2019 was valued at 35,000.
(ii) Further bad-debt of 1,000 is to be written off and a provision for
doubtful debts @ 5% on Sundry Debtors is to be maintained.
(iii) Goods costing 5,000 have been distributed as free sample.
(iv) Purchase of machinery worth 20,000 on 01.10.2018 has been
wrongly included in Purchases Account. Depreciation @ 10% p.a. is
to be charged on machinery.
(v) Office expenses outstanding 500.
Prepare Trading Account, Profit & Loss Account for the year ended
on 31.03.2019 and Balance Sheet of Mr. Roy as on that date.

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2. The following Trial Balance was extracted from the books of Mr. Saptarshi
Chakraborty as on 31.03.2022.
Particulars Dr. (₹) Particulars Cr. (₹)
Plant and Machinery 2,50,000 Capital 5,00,000
Wages 20,000 Sundry Creditors 36,000
Salaries 36,000 12% Bank Loan (01.07.2021) 1.50,000
Carriage Inward 5000 Return 7,000
Carriage Outward 8000 Provision for Bad Debts 6,000
Buildings 3,00,000 Sales 11,10,000
General Expenses 33,000
Return 7,500
Sundry Debtors 56,000
Stock (01.04.2021) 40,000
Purchases 10,00,000
Bad Debt 3,500
Discount Allowed 1,500
Interest on Bank Loan 8.500
Cash at Bank 35,000
Cash in hand 5,000
18,09,000 18,09,000

Prepare the Trading and Profit & Loss Account for the year ended 31.03.2022 and
Balance Sheet as on that date taking into consideration the following information:
(a) Stock in hand as on 31.03.2022 was: Cost Price ₹48,000; Net realisable value
₹46,000.
(b) Depreciation Plant and Machinery at 10% p.a.

(c) ₹5,000 is due from Mr. Tanbir, as customer and at the same time ₹8,000 is
due to him, as supplier, Create provision for doubtful bet at 5% on general
debtors.
(d) Goods distributed as free sample worth 5,000.
(e) Cash found short by ₹ 500 at the time of cash counting.
(f) A cheque of 2,000 issued to supplier on 25.03.2022, correctly recorded in the
books but not encashed by the supplier till 31.03.2022.

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3. From the following balances, prepare Trading and Profit & Loss
Account for the year ended 31.12.2021 and Bal- ance Sheet as on
31.12.2021 in the books of Mr. Arijit Mukherjee, a trader.
Particulars Dr. (₹) Cr. (₹)
Capital 2,80,000
Opening Stock 1,00,000
Purchases 4,00,000
Salaries 70,000
Building 1,10,000
Cash in hand 2,000
Cash at Bank 1,35,000
Bills receivables 10,000
Rent, Rates and Taxes 8,000
Miscellaneous Receipts 10,000
Sales 7,20,000
Bad debt 3,250
Miscellaneous Expenses 13,450
Advertisement\ 22,900
Furniture 1,10,000
Debtors 1,45,000
Creditors 80,000
10% Loan on Mortgage 70,000
Interest paid on the loan 3,000
Pre-paid expenses 4,000
Drawings 30,200
Bills payable 30,000
Bank charges 3,200
Travelling expenses 10,000
Insurance 10,000
Total 11,90,000 11,90,000
contd. next page

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Additional Information:
(a) Closing Stock at cost 57,000 (Market value 56,000)
(b) 2,500 received as loan from Rahaman credited to Debtors.
(c) Outstanding salary 500.
(d) Goods worth ₹20,000 were destroyed by fire and Insurance claim
admitted ₹15,000
(e) Miscellaneous receipts represent sale of furniture on 30.06.2021
(WDV ₹12,000 on 01.01.2021)
(f) Depreciation on fixed asset @ 10% р.а.
(g) Provision for bad debt to be maintained @ 5%.

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4. The following is the Trial Balance of Mr. SK Sen as on 31st December, 2018:
Debit Balance ₹ Credit Balance ₹
Drawings 5,800 Capital 60,000
Stock 28,000 Returns 3,200
Returns 4,200 Sales 2,10,000
Purchases 1,75,000 Sundry Creditors 25.500
Freight and Carriage 9,700 Bank Loan @ 6% p.a. 20,000
Rent and Taxes 3,600 Misc. Income 500
Salaries and Wages 15,300 Discounts 1,600
Sundry Debtors 35,000
Interest on Bank Loan 1,000
Printing & Advertisement 7,800
Cash at Bank 6,000
Discounts 1.200
Furniture & Fittings 6,000
General Expenses 8,600
Insurance 2,800
Cash in hand 2,000
Postage & Telegram 480
Travelling Expenses 320
Machinery 8,000
3,20,800 3,20,800

Additional Information:
(i) Included amongst the Debtors is 4,000 due from R Das and Included
among the Creditors 3,000 due to him.
(II) Provision for doubtful debts be created @ 10% and provision for
discount 5% on debtors.
(iii) Personal purchases amounting 2,000 had been included in the
purchase day book.

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(iv) Depreciate furniture & fittings and machinery 10% and 15% p.a.
respectively.
(v) Interest on bank loan is outstanding for 2 months.
(vi) Stock on 31.12.2018 was ₹ 65.000.

5. The following Trial Balance has been extracted from the books of
Mr. Das as on 31st March, 2018:
Particulars ₹ Particulars ₹
Opening Stock 2,400 Capital 46,200
Building 2,10,000 Creditors 25,000
Bad Debt 3,500 10% Loan (Taken on 01.01.17) 24,000
Closing Stock 24,000 Commission Received 200
Furniture 10,000 Sales 1,28,700
Drawings 4,500 Outstanding Salaries 3,000
Wages 1,800 Provision for Bad Debt 2,100
Purchases (Less Closing Stock) 1,18,000
Advertisement 1,400
Debtors 9,000
Cash 3.200
Interest on Loan 400
Commission Paid 600
Office Equipment 18,000
Miscellaneous Expenses 700
Insurance Premium 800
Salaries 10,000
Patent 7,200
Rent 2,400
Carriage Inward 1,300
4,29,200 4,29,200
contd. next page

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Prepare Trading Account and Profit & Loss Account for the year ended
31st March, 2018 and a Balance Sheet as on date after considering the
following:
(a) Furniture costing 12,000 purchased on 01.10.2017 on credit was
recorded as credit purchase of goods.
(b) Mrs. Samanta, Debtors for 2,000 was declared insolvent, only 40
paise in the rupee was expected to realise from his estimate. Create
Provision for Doubtful Debts at 5% and Provision for Discount at 2%
on Debtors.
(c) Patent (acquired on 01.04.2015) having a useful life of ten years, is
to be amortised in 10 equal instalments over the years.
(d) Depreciate relevant fixed assets at 10% p.a.

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6. The following Trial Balance is extracted from the books of Mr. S.K.
Sen as on 31.03.2015.
Debit Balance Amount Credit Balance Amount
(₹) (₹)
Plant and Machinery 4.00,000 Capital 5,70,000
Opening Stock 45,000 Sundry Creditors 36,000
Sundry Debtors 50,000 Sales 2,40,000
Wages 15,000 Return Outward 30,000
Salaries 20,000 Provision for Doubtful Debts 2,000
Rent 22,000
Income Tax 2,500
Purchases 1,80,000
Return Inward 15,000
Bad Debt 12,500
Insurance 4,000
Office Expenses 7,000
Cash in Hand 45,000
Cash at Bank 60,000
8,78,000 8,78,000
Additional information:
(i) Stock as on 31.03.2015 ₹50,000.
(ii) Machinery purchased on 01.10.2014 for ₹40,000 was wrongly
debited in Purchases Account. Depreciation @15% p.a. to be charged
on machinery.
(iii) Outstanding office expenses amounted to ₹1,500,
(iv) Goods worth ₹7,000 was distributed as free sample.
(v) Create a provision for doubtful debts @5% on Sundry Debtors after
writing off ₹2,500 as further bad debts.
You are required to prepare Trading and Profit and Loss Account for
the year ended 31.03.2015 and Balance Sheet as on the same date.
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Depreciation [Approx 10 Marks]
1. On 01.01.2018, a new plant was purchased by Mrs. Basu for ₹
1,00,000 and a further sum of ₹ 5,000 was spent on its installation. On
01.06.2019, another plant was acquired for ₹ 65,000.
On 02.10.2020, the first plant was totally destroyed and the amount
of ₹ 2,500 only was realised by setting the scrap. It was not insured.
On 20.10.2020, a second hand plant was purchased for ₹ 75,000 and
a further sum of ₹ 7,500 was spent on repairs and ₹ 2,500 on its
erection. It came into use on 15.11.2020. Depreciation has been
provided at 10% on the original cost annually on 31st December. In
December 2020, it was decided to change the method of depreciation
and follow the rate of 15% on diminishing balance method.
Show Plant Account, Plant Disposal Account and Provision for
Depreciation Account for 3 years.

2. Use of Provision for Depreciation Account and Asset Disposal Account

The cost of machinery in use with a firm on 1st April, 1999, was ₹
3,00,000 against which the depreciation provision stood at ₹ 1,20,000
on that date. The firm provided depreciation at 10% p.a. on the
diminishing value.
On 31st December, 1999, two machines costing ₹ 30,000 and ₹ 20,000
respectively, both purchased on 1st October, 1996, had to be
discarded because of damage and had to be replaced by two new
machines costing ₹ 45,000 and ₹ 35,000 respectively. One of the
discarded machines was sold for ₹ 15,000; against the other it was
expected that ₹ 5,000 would be realised.

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Show the relevant accounts in the ledger of the firm of the year ended
31st March, 2000. [C.U. B.Com. (Hons)]
3. ABC Industries depreciates its machines @ 10% p.a. on straight
line basis. On 1st April, 2018 the balance in Machinery Account
was 17,00,000 (original cost ₹ 24,00,000). On 1st July, 2018 a new
machine was purchased for 50,000, On 31st December, 2018 an old
machine having WDV of 80,000 on 01.04.2018 (original cost
1,20,000) was sold for 60,000.
Show the Machinery Account for the year ended 31st March, 2019.

4. Plant and Machinery Raving Value of ₹ 1,00,000 was brought on

1st January, 2015. On 15th July, 2016 a new machine was
purchased for 40,000. Installation charges paid for this machine was
₹ 5,000. The machine (bought on 15th July, 2016) was sold at a
profit of 7,000 on 1st September, 2018.
Write up the Plant and Machinery Account for the four years ended
31st December, 2018 providing 10% p.a. depreciation under
Diminishing Balance Method.

5. Change in method of Depreciation [DBM to SLM]

X Ltd. purchased a Machine for 6,00,000 on 01.01.2014. It decided
to provide depreciation @ 10% p.a. under the diminishing balance
method and to close its books of accounts on 31st December each
year.
At the time of closing on 31.12.17 it decided to follow the fixed
instalment method. The residual value of the machine and its
remaining life were estimated as 8 years and 37,400 respectively.
Show the Machinery Account for the years between 2014 and 2017.

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6. Mr X. is engaged in car rental business. On 1.4.2014 he purchased 3
second hand motor cars at ₹ 3,00,000 each and ₹ 60,000 each for
overhauling and conditioning of the cars purchased, which was
completed on 30.04.2014. The cars were put to use from 1.5.2014.
He writes off depreciation @ 20% per annum on original cost from the
date cars were put to use and closes books on 31st December every
year.
On 1.10.2016 one car is completely destroyed in a road accident and a
sum of ₹ 1,70,000 is received from the Insurance company in
settlement of the claim.
On the same day he purchases 3 new cars at ₹ 6,00,000 each and puts
them to use from that date.
Prepare Motor car Account from 2014 to 2016 in the books of Mr. x.
Working notes should form part of the answer.
[CU B. Com (Hons.) 2017- (cc 1.1. ch.)]

7. ABC Ltd. purchased the following machines: ₹

On 1st January, 2018 40,000
On 1st July, 2018 20,000
On 1st October, 2019 10,000
Depreciation was provided @ 10% p.a. under the diminishing balance
method. The machine purchased on 1st July, 2018 was sold on 31st
March, 2019 at 15,000.
Show the Machinery accounts in the books of ABC Ltd. for the year 2018
and 2019 assuming that accounts are closed on 31st December every year.

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Sectional and Self Balancing Ledger (Approx 10 Marks)
1. From the following particulars, as extracted from the books of a
trader, prepare the General Ledger Adjustment Account as it would
appear in the Sales Ledger on 31.12.2022:
Particulars (₹)

January 01, 2022 Sales Ledger Balances (Dr.) 62,710

Provision for Doubtful Debt 1,720
December 31, 2022 Sales 1,08,290
Bills Accepted by Debtors 14,430
Bills Dishonoured 540
Cash and Cheque received from customers 88,625
Cheque Dishonoured 220
Goods Returned by Customers 4,710
Transfer from Bought Ledger 780
Bad-Debts written off 1,610
Cash Discount Allowed 2,400
Interest on Customers' Overdue Account 330
Carriage Charged to Customers 1,220
Bad-Debts previously written off now
recovered 850

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2. From the following particulars, prepare Debtors Ledger Adjustment
Account as it would appear in Nominal ledger for the year ended
31.03.2021 in the books of Manish Shaw.
₹
Debtors debit balance as on 01.04.2020 1,54,700
Debtors credit balance as on 01.04.2020 200
Total sales (including cash sales 3,400) 4,83,400
Return Inward 12,400
Cash received from debtors (after allowing discount at 3%) 3,00,700
Cash paid to debtors (refunded to excess amount received) 2,000
Bills receivables drawn 10,000
Bad debts 43,000
Provision for bad debt 1,300
Endorsed bill dishonoured 3.400
Debtors credit balance as on 31.03.2021 600
Included in debtors was an amount ₹ 10,500 due from Sekhar from
whom goods worth ₹ 8,400 were purchased.
Sekhar agreed to set off his claim against the amount due from him
and action was taken accordingly.

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3. From the following Information you are required to prepare the
Sales Ledger Adjustment Account as on 31.03.20:
Amount
₹
Debtors as on 01.03.20 55,842
Transaction during the month were as follows:
Sales (Including cash sales 10,000) 1,08,606
Cash received from Debtors 88,753
Discount allowed to Debtors 480
Acceptances received from Debtors 7,120
Return from Debtors 5,430
Bills receivable from Debtors 1,120
Bad debt written off 3,890
Sundry charges debited to customer 378
Transfer to bought ledger 100
Provision for doubtful debts 2,500
Bill endorsed 100

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4. Mr. V maintains his books of accounts under sectional balancing
system. From the following particulars prepare the Total Creditors
Account as would appear in the general ledger of Mr. V
₹ ₹
01.01.09 Opening Balance (Cr) 12,400 Returns (Debit) 380
(Dr) 270 Returns (Credit) 250
31.12.09 Purchases Bills Receivable Endorsed 480
(including Cash Purchases 4,000) 23,000 Bills Payable Dishonoured 300
Cash & Cheques Paid to Suppliers 18,500 Cheque Dishonoured 200
B/P Accepted 3,000 Endorsed Bill Dishonoured 240
Recovery of Bad Debts B/R Discounted 600
Previously written off 60 Discount Received 100
Interest Charged by Supplier
Transfer from Sales Ledger 300
Closing Balance (Dr) 150
[C.U. B.Com. (Hons.) 2010]

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5. From the following information, prepare Sales Ledger Adjustment
Account in the Nominal Ledger: ₹
01.04.17 Debtors Ledger Balance (Dr.) 45,000
01.04.17 Debtors Ledger Balance (Cr.) 1,000
31.03.18 Sales 4,10,000
Bad Debt 1,650
Miscellaneous Charges Debited 175
Cash Received from Debtors 3,20,000
Returns Inward 5,000
Bad Debt Recovered 450
Bills Received 30,000
Discount Allowed 7,500
Transfer from Bought Ledger 75

6. From the following information, prepare Sales Ledger Adjustment

Account and Bought Ledger Adjustment Account in the General Ledger.

On 1.4.1998 Balances in Bought Ledger: Debit ₹ 10,000 and Credit ₹ 96,000

Balances in Sales Ledger: Debit ₹ 1,41,880 and Credit ₹ 2,240

31.3.1999 ₹ 31.3.1999 ₹
Purchases 5,40,000 Discount Received 7,200
Purchase Returns 20,000 Bills Receivable Received 40,000
Total Sales 7,68,000 Bills Payable Issued 22,400
Cash Sales 40,000 Provision for Doubtful Debts 9,160
Sales Returns 10,000 Cash Paid to Customers 1,840
Cash Received from Customers 6,24,000 Bills Receivable Dishonoured 6,000
Discount Allowed 11,200 Bought Ledger Balance (Dr.) 10,400
Cash Paid to Suppliers 4,80,000 Sales Ledger Balance (Dr.) 1,83,200
Transfer from Sales Ledger
to Bought Ledger 20,800

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Single Entry (15 Marks Approx)
1. Mr. Roy does not maintain a proper books of account. However, he
maintains a record of his bank transactions and is also to give the
following Information from which you are requested to prepare his
Trading and Profit & Loss Account for the year ended 31.12.2022 and
Balance Sheet as on that date.
Particulars 01.01.2022 31.12.2022
(₹) (₹)
Debtors 1,02,500 ?
Creditors ? 46,000
Stock 50,000 62,500
Bank Balance ? 50,000
Fixed Assets 7,500 9,000
Details of his bank transactions were as follows:
Particulars (₹)
Received from Debtors 3,40,000
Additional Capital brought in 5,000
Sale of Fixed Assets (Book Value 2,500). 1,750
Pald to Creditors 2,80,000
Expenses Pald 49,250
Personal Drawings 25,000
Purchase of Fixed Assets 5,000

No cash transactions took place during the year. Goods are sold at cost
plus 25%. Cost of goods sold was ₹2,60,000.

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2. The following balance are available from the books of Somenath
Manna, a small trader, as on 31st December, 2020 and 2021:
Particulars 31.12.2020 31.12.2021
(₹) (₹)
Building 60,000 60,000
Equipment 1,20,000
Debtors 48,000
Creditors 32,000
Stock 34,000
Bank Loan 20,000 16,000
Cash 32,000 62,000
The transactions of Somenath during the year ended 31.12.2021 were
the following:

₹
Collection from Debtors 1,86,000
Payment to Creditors 1,22,000
Expenses 32,000
Drawings 6,000
Cash Purchase 40,000
Equipment purchased (01.10.2021) 14,000
Additional Information:
a) Cash sales amounted to 10% of total sales. Credit sales amounted to ₹
1,80,000.
b) Credit Purchases were 80% of total purchases.
1
(c) Somenath Manna sells goods at cost plus 33 %.
3

d) Equipment is to be depreciated by 10% per annum and Building by 2%.

(e) Difference in Cash Book, If any, is to be treated as drawings or
Introduction of Capital by the proprietor.
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3. Mr. T S Gupta kept no books of accounts for his business. An analysis of his
rough Cash Book for the calender year 2020 shows the following particulars:

Receipts Amount Payments Amount

₹ ₹
Received from Debtors 80,000 Overdraft (on. 01.01.2020 5,000
Further Capital Introduced 10,000 Pald to Creditors 42,000
Business expenses mob 12,000
Wages paid 17,500
Proprietor's drawings 5,000
Balance at bank (31.12.2020) 6,500
Cash in hand (31.12.2020) 2,000
90,000 90,000
The following particulars are also available:
31.12.19 31.12.20
₹ ₹
Debtors 60,000 90,000
Creditors 20,000 22,500
Stock in trade 16.000 18,000
Plant and Machinery 30,000 30,000
Furniture 2,000 2,000
All his sales and purchase were on credit.
From the above particulars, prepare Trading and Profit & Loss Account for the
year ended 31st December, 2020 and a Balance Sheet as on that date. Provide
depreciation on plant and machinery @10% p.a. and on furniture 5% p.a.

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4. Subal keeps his books on single entry method. On 1st January, 2018
his assets and liabilities were as follows:
Capital 61,000, Sundry Debtors 20,000, Plant and Machinery 31,000,
Furniture and Fittings 3,000, Stock 10,000 and Sundry Creditors 15,000.

The followings are the analysis of his Cash Book for the year 2018:
Receipts ₹ Payments ₹
Cash in Hand 12,000 Payment to Creditors 20,000
Received from Debtors 15,000 Wages 5,000
Cash Sales 20,000 Sundry Expenses 10,000
Drawings 5,000
Cash in hand 7,000
47,000 47,000
On 31st December, 2018 his assets and liabilities were as follows:
Sundry Debtors 25,000, Sundry Creditors 10,000, Plant and Machinery
31,000, Furniture and Fittings ₹3,000, Stock 22,000.
You are required to prepare a Trading and Profit & Loss Account for the
year ended 31st December, 2018 after providing
(a) Depreciation on Plant and Machinery 5% p.a. and Furniture and
Fittings @ 2% p.a.
(b) Provision for Bad and Doubtful Debts 5% on Sundry Debtors.

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5. Swati, a small trader, maintains her books under Single Entry system.
From the following information you are asked to prepare Trading Account,
Profit & Loss Account and Balance Sheet as on 31st December, 2018.

1st January, 2018 31st December, 2018

₹ ₹
Debtors 20,000 25,200
Creditors 15,000 14,100
Sewing Machine 15,000 14,200
Furniture 12,000 11.800
Bills Receivable 7,000 6,000
Bills Payable 3,000 5,000
Stock 4,000 3,000
Bank Summary

₹ ₹
Opening Balance 21,000 Payment to Creditors 42,000
Collection from 75,200 Bills Payable 2,800
Debtors 5,600 Rent 2,000
Bilis Receivable 13,000 Wages 2,000
Capital Printing 2,000
Drawings 24,000
Salaries 12,000
Closing Balance 28,000
1,14,800 1,14,800
Additional Information:
She allowed discount to debtors 2,400 and received discount from creditors
for ₹3,900. She endorsed bills receivable of 1,200 to her creditors.

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6. Mr. D. a trader, maintains an incomplete record for his business.
However, he keeps a detailed record of cash and bank transactions and
provides you the following summary of receipts and payments for the
year ended at 31.12.2016:
Receipts ₹ Payments ₹
Cash in hand on 1.1.16 3,600 Payment to Creditors 2,30,000
Cash at Bank on 1.1.16 62,000 Purchase of Furniture 12,000
(on 01.09.2016)
Collection from Debtors 2,20,000 Salaries 28,000
Cash Sales 70,000 General Expenses 8,000
Capital Introduced 60,000 Rent and Rates 15,000
Interest received on investment 5,000 Drawings 36,000
Cash Purchases 47,000
Cash in hand on 31.12.16 1,600
Cash at Bank on 31.12.16 43,000
4,20,600 4,20,600
Particulars of other assets and liabilities are as follows:
01.01.2016 31.12.2016
₹ ₹
Sundry Debtors 1,45,000 1,66,000
Sundry Creditors 2,90,000 2,23,000
Furniture 48,000 ?
Stock 57,000 70,000
Investment in 10% Bond 50,000 50,000
Debtors and Creditors balances on 31.12.2016 have been arrived at
after considering discount allowed and discount received amounting
to 9,000 and 7,000 respectively. Furniture is to be depreciated @ 10%
р.а. and a provision for doubtful debt is to be created for 3,300.

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Prepare a Trading and Profit & Loss Account for the year ended at 31st
December, 2016 and a Balance Sheet as on that date.
[C.U. B.Com. (1st Semester 2017) cc 1.1
7. Missing Information
Mr. X carries on a small business, but he does not maintain a
complete set of books of account. He banks all receipts and makes all
payments only by means of cheques. He maintains properly a Cash
Book, a Sales Ledger and a Purchase Ledger. He also makes a proper
record of the assets and liabilities as at the close of every accounting
year. From such records you are able to gather the following facts:
Receipts for the year ended March 31, 2004: ₹
From Sundry Debtors (Sales Ledger Account) 17,625
Cash Sales 4,125
Paid in by X, the proprietor 2,500
Payments made in the year ended at March 31, 2004: ₹
New Furniture Purchased 625
Drawings 1,500
Wages 6,725
Salaries 1,125
Interest Paid 75
Telephone 125
Rent 1,200
Light and Power 475
Sundry Expenses 2,125
Sundry Creditors (Purchase Ledger Accounts) 7,625

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Assets and Liabilities:
As on March As on March
31, 2003 31, 2004
Purchase Ledger Balance (Creditors) 2,525 2,400
Sales Ledger Balance (Debtors) 3,750 6,125
Bank 625
Stock 6,250 3,125
Furniture 7,500 7,315

From the above data prepare the Trading Account and Profit and Loss Account
for the year ended at March 31, 2004 and the Balance Sheet as on that date.
C.U. B.Com. (Hons.) 2005]

8. Calculation of Opening capital, (b) Calculation of Closing Capital

and Profit; (c) Preparation of Final Statement of Affairs.
A Trader as not kept proper books of accounts but from the following
details you are required to ascertain Profit or Loss made by him during
the year ending 31st December, 1994 and also to prepare a Statement
of his Affairs as on that date:
31st December 1993 31st December 1993
₹ ₹
Cash in hand 700 850
Cash at Bank 2,500 3,000
Stock-in-trade 25,000 30,000
Sundry Debtors 30,000 40,000
Sundry Creditors 15,000 12,000
Plant & Machinery 80,000 1,00,000
Furniture & Fixture 30,000 25,000
During the year the Trader has withdrawn ₹2,000 per month to meet
his family obligations.
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Depreciate Plant & Machinery @10% p.a. and Furniture & Fixture @
5% p.a. As regards the Debtors it is ascertained that ₹1,000 are
irrecoverable and a provision of 2% is to be created on Debtors.
[C.U. B.Com. (Pass) 1995]

9. Where Partners have fixed capitals

X and Y are partners in a firm. The books of the firm are kept on Single Entry
System. The position of the firm on 31st March, 1995 is as follows:
Liabilities ₹ Assets ₹
Capital Account: Plant 4,500
X 5,000 Furniture 1,500
Y 3,000 Stock 1,700
Current Account: Debtors 3,500
X 2,000 Bank 800
Creditors 3,000 Current Account: y 1,000
13,000 13,000
On 31st March, 1996, Cash at Bank was 1,100; Debtors 2,900; Stock
1,400; Creditors 2,300 and Y's loan (1.10.95) 200. Partner's Drawing
during the year were: X600 and Y700.
You are required to prepare a Profit & Loss Statement for the year ended
31st March, 1996 and a Statement of Affairs as at that date after taking
into consideration the following additional information:
(i) Plant and Furniture to be depreciated by 10% p.a.
(ii) Y to receive a salary of 300 for the year.
1
(iii) Interest on Partner's Capital to be allowed at 2 % p.a.
2

[C.U. B.Com.]

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Rectification Of Errors [Approx 10 Marks]
1. Rectifications after Trial Balance but before preparation of Final Accounts.

The Trial Balance of S. Kumar as on 31.12.1995 did not agree and the
difference was transferred to a Suspense Account.
Subsequently the following errors were detected:
(i) The total of one page of the Sales Day Book was carried forward to the
next page as ₹4,513 instead of ₹4,531.
(ii) The total of the Purchase Day Book was undercast by ₹400.

(iii) A Cash discount of ₹150 received from a creditor was debited to

Discount Account.
(iv) 1,450 spent on repairs of Delivery Van was debited to Motor Vehicles
Account.
(v) 300 received from M. Ghosh was debited to the Account of N. Ghosh in
the Sales Ledger.
(vi) Goods worth 700 returned by Islam was not entered in the books at all.
(vii) 211 interest on overdraft was credited to Interest Account.
[C.U. B.Com. Adapted]

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2. Rectification after preparation of Final Accounts.
A trader agreed his Trial Balance by putting the difference in a Suspense
Account and prepared Trading and Profit & Loss Account and a Balance Sheet.
On subsequent scrutiny, the books disclosed certain errors detailed below:
(i) A Sale of Goods to X for 350 had been credited to his account.
(ii) Goods purchased from Q for 750 was entered in the Purchase Day Book
hut omitted to be posted to his account in the Creditors Ledger.
(ii) Goods returned by Z of 500 was not debited to Return Inwards Account.
(iv) An office typewriter purchased for 1,500 had been debited to Purchase
Account.
(v) Repairs to office car for 750 were debited to office Car Account. (vi)
Goods returned to S. Sen of 75 were debited to P. Sen Account.
Rectify the above errors and ascertain the amount carried to Suspense
Account.
Will the above rectifications, affect the profit figure? If so, to what extent?
[C.U. B.Com. Hons. Adapted)

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3. The following errors were discovered in the books of a trader for the year
ended December 31, 1995:
(a) The total of the Purchase Day Book had been undercast by ₹100.
(b) The discount column of the debit side of the Cash Book had been posted
to the credit of the Discount Received Account ₹20.
(c) ₹76 paid for Repairs of Motor Van had been taken to Motor Van A/c.
(d) A cheque received from B ₹39 had been debited in Cash Book but the
double entry had not been completed.
(e) The Returns Outward Book had been overcast by ₹50.
Show the Rectification entries considering that the Final Accounts had
already been prepared and the net profit arrived at amounted ₹24,320
(before corrections). Show the calculation of the net profit for the year.
[C.U. B.Com. Hons.]
4. Errors detected after preparation of Final Accounts.
The Trial Balance extracted from a set of books showed a difference which
was placed in Suspense Account to prepare the Final Accounts at that time.
Subsequently, the following mistakes were detected:
(a) A dishonoured cheque for ₹500 received from A and returned by the
Bank has been credited to the Bank Account and debited to Sundry
Creditors Account.
(b) Several items of furniture sold for ₹2,500 had been entered in the Sales
Day Book.
(c) Goods purchased from X, a supplier for ₹155, had been posted to the
debit of his account as ₹150.
(d) ₹600 due from B had been omitted from the schedule of Sundry Debtors.
Show the necessary entries in the Journal properly ruled with suitable
narrations to rectify these errors.
Show also how non-detection of these errors affected last year's P & L A/c.
[C.U. B.Com. (Hons.)]
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5. The following errors were discovered after preparation of Trial
Balance but before preparation of Final Accounts. Show Journal
Entries to rectify the above errors:
(a) A sale of ₹ 3,400 made to Mr. X was correctly entered in the Sales
Day Book but wrongly posted to the debit of Mr. Y as ₹340.
(b) Goods of the value of ₹2,500 returned by Mr. Sengupta were
entered in the Sales Day Book and posted there from to the credit of
this account.
(c) A cheque of ₹5,348 received from Mr. Sarkar after allowing hm a
discount of ₹58 was endorsed to Mr. Karmakar in full settlement of
₹5,400. The cheque was finally dishonoured but no entries for
dishonour were passed in the books.
(d) A payment of ₹8,500 towards cost of stamps and registration of new
building acquired was posted to the Legal Charges Account as ₹5,800.
[C.U. B.Com. (Hons.) 2015]

6. The following errors were detected after preparing the Trial Balance
but before the preparation of Final Accounts in the books of Mr. Basu:
(a) The total of Return Inwards Books has been cast ₹1,000 short.
(b) A sum of ₹4,000 written off from machinery has not been posted
to Depreciation Account.
(c) The purchase of an office furniture costing ₹13,000 has been
passed through the Purchase Day Book.
(d) ₹600 received from Mr. Roy has been debited to Mr. Sen.
Show the Journal Entries for rectifying the above errors.
[C. U. B.Com. (Hons.) – 2016]

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7. Rectify the following errors after preparation of Trial Balance but
before preparing Final Accounts by passing necessary Journal entries:
(a) Goods taken by proprietor of ₹5,000 for gift to his son were not
recorded at all.
(b) ₹5,000 received from Bablu against debts previously written off as
bad debts have been credited to his personal account.
(c) A cheque received from Ashis, a debtor for ₹4,000 was directly received
by the Proprietor who deposited it into his personal bank account.

8. The Trial Balance of Mr. Saha did not agree as on 31.03.2018 and
the difference were put to suspense account and the following
mistakes were detected before preparation of final accounts:
(a) Purchases Day Book was over cast by ₹2,200.
(b) ₹12,000 paid to Sudipta was wrongly debited to Sudipa Account.
(c) ₹6,900 paid for replacement of a motherboard of a desktop,
debited to Repairing Charges Account as ₹900.
You are required to pass necessary journal entries to rectify the above errors.

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Sales On Approval [Approx 5 Marks]
1. A trader sends out goods on approval to some customers and
includes the same in the sales account. On 31.12.20, the Sundry
Debtors balance (₹2,50,000) includes ₹14,000 regarding goods sent on
approval against which no intimation was received as on 31.12.20.
These goods were sent out at 25% above cost price and were sent to
A-₹ 8,000 and B-₹6,000. Stock in trade In godown was valued at
₹50,000 on 31.12.20. A sent intimation of acceptance on 31.01.21 and
B returned the goods on 15.01.21.
Pass adjustment entries on 31.12.20. Show also the entries to be made
during January, 21.

2. A trader has credited certain items of sales on approval aggregating

₹10,000 to sales account. Of these, goods to the value of ₹3,000 have
been returned and taken in stock at ₹1,500 though record of return was
omitted in accounts; and in respect of another parcel of ₹1,000 (cost
being ₹500), the period of approval did not expire on the closing date.
Show adjustment and correcting entries in the books of the trader.

3. While preparing the Final Accounts of a Company it is found that the

amount of its Debtors, ₹5,00,000, includes ₹80,000 worth of goods sent
out on approval and debited to Customer's accounts in respect of which
the time for returning the goods had not yet expired. The goods had been
1
invoiced at 33 % above cost.
3

Show the Journal entries to be passed in preparing the final accounts and
also state the adjustments to be made in the final accounts.
[C.U. B.Com. (Pass)]

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4. M/s Prajapati Traders sends goods to its customer on sale or return basis.
The following transactions took place in January to December 2022.
Date Transactions ₹
10.07.2022 Sent goods to customer on sale or return basis at 20% profit on sale 40,000
15.07.2022 Goods returned by the customer 10,000
04.08.2022 Received letter of approval from the customer 20,000
31.12.2022 Goods with customer awaiting approval 10,000
Pass the necessary journal entries to record the above transaction in the
books of M/s Prajapati Traders.

5. M/S Bose Brothers, a trader sends goods to his customer on sale or

return basis. The following transactions took place during 2017:
25.09.17 Sent goods to customers on sale or return basis at cost plus 30% 1,50,000
23.10.17 Goods returned by customers 40,000
18.11.17 Received letters of approval from customers confirming Purchase goods. 71,000
31.12.17 Goods with customers awaiting approval 39,000
(date of return has not yet expired)
M/S Bose Brothers records sale or return transactions as ordinary sales. You
are required to pass necessary journal entries in the books of M/S Bose
Brothers assuming that accounting year closes on 31st December, 2017.
[C.U. B.Com. (Hons.) 2017 First Semester, Paper cc 1.1]

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Introduction (Practical) [Approx 5 Marks]
1. From the following information ascertain income for the year ended
31.3.2023 according to the cash basis of accounting.
(i) Income received in cash for the year ended 31.3.2023 ₹1,40,000
(ii) Accrued income as on 31.3.2023 ₹2,500
(iii) Income received in advance during the year ended 31.03.2023 ₹15,000
(iv) Outstanding expenses as on 31.3.2023 3,500
(v) Prepaid expenses as on 31.3.2023 ₹5,000
[C.U. B.Com. (Hons.) 2014-Adapted]

2. From the following information, ascertain the income for the year ended
31.03.2022 according to accrual basis of accounting.
(i) Income received in cash during the year ended 31.12.2022 ₹1,48,000
(ii) Income accrued as on 01.01.2022 ₹10,000
(iii) Accrued income as on 31.12.2022 ₹12,000
(iv) Income of 2022 received in 2021 ₹5,000
[C.U. B.Com. (Hons.) 2015-Adapted]

3. From the following particulars ascertain the net income of Mr. Roy for
the year ended 31.12.2022 according to Cash Basis of Accounting:
Amount (₹)
Income Received in Cash for the year ended 31.12.2022 45,000
Income Received in Advance during 2022 10,000
Accrued Income as on 31.12.2022 4,000
Accrued Income of 2021 received in 2022 6,500
[C.U. B.Com. (Hons.) 2016- Adapted]

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4. What is Asset? Using the accounting equation, calculate the value of total
assets from the following data:
Capital ₹2,00,000
Creditors ₹50,000
Revenue during the period ₹4,50,000
Expenses during the period ₹1,65,000

5. 1. Mr. Roy gives the following information relating to his income and
expenditures for the year ended 31.12.2020:
₹
Fees received in cash (gross) 50,500
Fees earned but not yet received 4,500
Fees received in advance 3,000
Fees for 2019 received 2,000
Staff Salaries paid (gross) 8,200
Salaries paid in advance 1,200
Salaries for 2019 paid 1,000
Rent paid for office (gross) 7,100
Outstanding office rent 600
Rent for 2019 paid 500
Telephone charges paid 1,600
Calculate the net income of Mr. Roy for the year 2020, under (1) Cash Basis,
and (ii) Accrual Basis.

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6. Dr. R K Das started his profession on 1st January, 2019 as medical
practitioner. His Incomes and expenses for the year 2019 relating to his
profession were as under:
Amount
(₹)
Fees received in cash 24,000
Fees accrued but not received 6,000
Rent paid for the Chamber 6,000
Outstanding Rent 2,000
Salary paid to Staff 6,000
Salary paid in advance to staff (included in the above) 1,000
Miscellaneous expenses paid 200
You are required to compute the net income of Dr. R K Das from his
profession for the year ended 31.12.2019 under (a) Cash Basis; (b) Accrual
Basis.

7. From the following information, ascertain income for the year ended
31.03.2019 according to accrual basis of accounting:
(a) Income received in cash for the year ended 31.03.2019 ₹2,00,000
(b) Accrued income as on 31.03.2019 ₹35,000
(c) Income received in advance during the year ended 31.03.2019 ₹20,000
(d) Outstanding Expenses as on 31.03.2019 ₹40,000
(e) Prepaid Expenses as on 31.03.2019 ₹30,000

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Introduction (Theory) [Approx 5+5= 10 Marks]
a) Users of accounting information
b) Qualitative characteristics of accounting information
c) Accounting Cycle
d) Periodicity concept, consistency concept, Conservatism Concept,
Matching concept & Materiality Concept.

1. Distinguish between capital expenditure and Revenue expenditure.

2. Distinguish between provision and Reserve.
3. Distinguish between capital reserve and Revenue reserve.
4. Distinguish between Self balancing and Sectional balancing ledger.

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Not for Profit Organization [Approx 10-15 Marks]
1. The following is the Receipt and Payment of Anandadhara Cultural
Club for the year ended on 31.12.2022
Particulars ₹ Particulars ₹
Cash in hand on 01.01.2022 1,500 Stationery 3,000
Subscription: 10,000 Salaries 7,900
2022 16,400 10% Investment 5,000
2023 250 (Purchased on 30.06.22)
Proceeds from Cultural Program 2,000 Office Expenses 1,420
Entrance Fees 1,020 Expenses for Cultural Program 800
Interest on Investment 250 Cash In hand on 31.12.2022 3,300
21,420 21,420

Additional Information:
(a) Depreciation premises by 5%
(b) Outstanding subscription for 2022: ₹1,200
(c) Entrance fees is to be capitalized 100%.
(d) Other information: 01.01.2022 31.12.2022

(₹) (₹)

Premises 20,000 20,000

Stock of Stationery 1,000 1,200
Creditors for Stationery 2,000 2,500
You are required to prepare Income and Expenditure Account for the
year ended 2022 and Balance Sheet as on that date.
6+4

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2. The following is the Receipts and Payments Account of The
Calcutta Football Club for the year ended 31.12.2020.
Receipts ₹ Payments ₹
01.01.2020 31.12.2020
Cash in hand 2,000 Remuneration to Club coach 5,000
Balance as per Bank P/s book Groundsmen's pay 2,500
Savings Account 19,300 Purchase of equipment 15,500
Current Account 6,000 Bar room expenses 2,000
31.12.2020 Ground Rent 2,500
Bank Interest 500 Club night expenses 3,800
Entrance fees 1,800 Printing & Stationery 3,000
Donation and Subscription 25,000 Repairs to equipment 5,000
Bar room receipts 4,000 Honorarium to Secretary for
Contribution to Club night 1,000 the yr. 2020 4,000
Sale of equipment 800 Balance at Bank as per P/s b
Net proceeds of Club night 7,800 Savings Account 20,400
Current Account 2,000
Cash in hand 2,500
68,200 68,200
You are given the following additional information (all figures in ₹)

01.01.2020 31.12.2020
(i) Subscription due from member 1,500 1,000
(ii) Sums due from Printing & Stationery 1,000 800
(iii) Unpresented Cheques on Current Account 3,000 2,500
(iv) Interest on Savings Bank Account, not entered in Passbook — 200
8,000 17,500
(v) Estimated value of equipment

(vi) For the year ended 31.12.2020, the Honorarium to Secretary are to be
increased by a total of ₹2,000 and the Groundsman is to receive a bonus of ₹2,000.

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You are required to prepare
(a) An Income and Expenditure Account for the year ended
31.12.2020, and
(b) A Balance Sheet as on that date.

3. A summary of receipts and payments of Medical Ald Society for

the year ended 31.12.2019 is given below:
Receipts Amount Payments Amount
₹ ₹
To Balance (01.01.2019) 7,000 By Payment for medicines 30,000
” Subscription 50,000 ” Honararium to doctor 10,000
” Donations 14,500 ” Salaries 27,500
” Interest on Investments ” Sundry Expenses 500
@7% p.a. 7,000 ” Equipment purchased 15,000
” Charity show proceeds 10,000 ” Charity show expenses 1,000
” Balance (31.12.2019) 4,500
88,500 88,500
Additional Information (in ₹):
01.01.19 31.12.19
Subscriptions due 500 1,000
Subscriptions received in advance 1,000 500
Stock of medicines 10,000 15,000
Amount due to medicine suppliers 8,000 12,000
Value of equipment 21,000 30,000
Value of Buildings 40,000 38,000
You are required to prepare Income and Expenditure Account for the year
ended on 31st December, 2019 and the Balance Sheet as on that date.

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4. The following is the Receipts and Payments Accounts of Calcutta
Football Club for the year ended 31.12.2018:
Receipts ₹ Payments ₹
Cash in Hand 2,500 Remuneration to Coach 6,000
Cash at Bank 22,300 Groundman's Salary 2,500
Bank Interest 500 Purchase of Equipments 15,500
Entrance Fees 5,000 Bar Room Expenses 2,000
Subscriptions 25,000 Ground Rent 4,500
Bar Room receipts 4,000 Night Club Expenses 4,800
Sale of Equipment 800 Printing and Stationery 2,500
Proceeds of Night Club 10,800 Repair to Equipment 4,500
Cash at Bank 25,600
Cash in hand 3,000
70,900 70,900
Additional Information:
01.01.2018 31.12.2018
₹ ₹
Subscription Due 1,500 1,000
Outstanding Expenses for Printing & Stationery 1,000 800
Equipment 8,000 17,500
You are required to prepare:
(a) An Income and Expenditure Account for the year ended 31.12.2018.
(b) A Balance Sheet as on that date.

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5. From the following information prepare Income & Expenditure Account
of Hugli Club for the year ended 31st December, 2018 and a Balance Sheet
as on that date.
(a) Subscriptions in arrear for 2018 ₹ 900 and received in advance for 2019 ₹350.
(b) Insurance Premium due ₹ 40.
(c) Miscellaneous expenses prepaid ₹90
(d) 50% of the donation to be capitalized.
(e) 75% of entrance fees are to be capitalized.
(f) 8% interest in accrued on investment for five months.
(g) Tennis Table was purchased in 2017 for ₹ 30,000. Only 22,000 was paid
for it till 31st December, 2017.
Receipts and Payments A/c for the year ended 31.12.2018
Receipts ₹ Payments ₹
Cash In Hand 4,000 Salary 2,000
Cash at Bank 10,000 Repairs 500
Donation 5,000 Furniture 6,000
Subscription 12,000 Misc. Expenses 500
Entrance Fees 1,000 Investment 6,000
Interest on Investment 100 Insurance Premium 200
Interest Received from Bank 400 Tennis Table 8,000
Sale of Old Newspaper 150 Stationeries 150
Sale of Drama Tickets 1,050 Drama Expenses 500
Cash in Hand 2,650
Cash at Bank 7,200
33,700 33,700

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6. Following is the Receipts and Payments Account of Viveknagar Social
Club for the year ended at 31st December, 2015:
Receipts ₹ Payments ₹
Balance as on 1.1.2015 3,560 Salaries 2,450
Subscriptions: Electricity 410
2014 180 Charity 1,680
2015 6,940 General Expenses 320
2016 240 Rent and Taxes 450
Donations 2,500 Expenses of Annual Function 2,300
Sale of Tickets of Annual Newspaper, etc. 460
Function 2,800 Investments 5,000
Sales of Waste Paper 130 Balance on 31st Dec, 2015 3,280
16,350 16,350
Additional Information:
(a) Salaries outstanding for the year 2015 are ₹150.
(b) Rent and Taxes include ₹75 for the year 2014.

(c) Value of building ₹12,000 as on 1.1.2015 and depreciation

@ 5% to be provided.
(d) Interest on investment is due for 3 months @ 10% p.a.
(e) The club has 360 members and subscription in ₹20 per annum.
Prepare an Income and Expenditure Account for the year ended 31st
December, 2015 and a Balance Sheet as on that date.
[C.U. B.Com. (Hons.)-2016]

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7. The following is the Receipts and Payments Account of Park View
Club in respect of the year ended at 31st March, 2017:
Receipts ₹ Payments ₹
Opening Balance 1,02,500 Salaries 2,08,000
Subscription Received: Stationery Purchased 40,000
2015-16 4,500 Rent 60,000
2016-17 2,11,000 Telephone Expenses 10,000
2017-18 7,500 2,23,000 Investments 1,25,000
Net Cash released from Sundry Expenses 92,500
Sports Meet 1,55,000 Closing balance 45,000
Income from Investment 1,00,000
5,80,500 5,80,500

Additional Information:
(a) There are 450 members each paying an annual subscription of
₹500. On 1st April, 2016, outstanding subscription was ₹5,000.
(b) There was an Outstanding Telephone Bill of ₹3,500 on 31st Mar, 17.
(c) Outstanding Sundry Expenses as on 31st March, 2016, totaled ₹ 7,000.
(d) Stock of stationery on 31st March, 2016 - ₹ 5,000 and on 31st
March, 2017 — ₹ 9,000.
(e) On 31st March, 2016, Building stood in the books at ₹ 10,00,000
and it was subject to Depreciation at 5% p.a.
(f) Investment on 31st March, 2016, stood at ₹ 20,00,000.
(g) On 31st March, 2017; Income accrued on Investments purchased
during the year amounted to ₹ 3,750.
Prepare an Income and Expenditure Account for the year ended 31st
March, 2017 and a Balance Sheet as on that date.
[C.U. B.Com. (Hons.) First Semester 2017 (cc 1.1.)]
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8. Preparation of Receipt & Payments Account and closing Balance Sheet
where Income & Expenditure and Opening Balance Sheet are given.

The Income & Expenditure Account of Ganga Boat Club for the year
ended on 31st December, 1995 stood follows:
Particulars ₹ Particulars ₹
To Salaries 19,500 By Subscriptions 38,000
” General Expenses 10,000 ” Entrance Fees 10,500
” Audit Fees 2,500 ” Donations 12,000
” Printing & Stationery 6,000 ” Sale of Periodicals 500
” Interests and Bank Charges 3,000
” Rent 3,000
” Periodicals 4,000
” Travelling Expenses 2,500
” Depreciation on Furniture 1,500
” Surplus 9,000
61,000 61,000
The following is the Balance Sheet of the club as at 31st December, 1994
Balance Sheet
Liabilities Assets
Liabilities for : Salaries 1,500 Furniture 7,500
Rent 500 Sports Equipment 10,000
Advance Subscriptions (1995) 1,000 Subscriptions Receivable 4,000
General Fund 37,000 Cash in hand & at Bank 18,500
40,000 40,000

Other details on 31.12.1995: Salaries Outstanding ₹2,500;

Subscriptions Outstanding- ₹3,000; Subscription Received in Advance
(1996) ₹1,000.
Prepare the Receipts & Payments Account for 1995 and the Balance
Sheet as at 31.12.1995.
[C.U. B.Com. (Hons.) Part-1, 1993-dates changed]
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Inventory Valuation {Approx 10 Marks]
1. X who was closing his books on 31.3.1996 failed to take the actual
stock which he did only on 9th April, 1996 when it was ascertained by
him to be worth ₹25,000.
It was found that sales are entered in the sales book on the same day
of dispatch and return inwards in the returns book as and when the
goods are received back. Purchases are entered in the Purchase Day
Book once the invoices are received.
It was found that sales between 31.3.1996 and 9.4.1996 as per the
sales day book are ₹1720. Purchases between 31.3.1996 and 9.4.1996
as per Purchase Day Book are ₹120, out of these goods amounting to
₹50 were not received until after the stock was taken.
Goods invoiced during the month of March, 1996 but goods received only
1
on 4th April, 1996 amounted to ₹100. Rate of Gross Profit is 33 % on cost.
3

Ascertain the value of stock as on 31.3.1996.

[C.A. Foundation Examination, May 1996]
[Similar to C.U. B.Com. (Hons.) Part 1, 2008]

2. Asim's financial year ends on 31st March, but actual stock has not
been taken till the 8th April, when it is ascertained at ₹12,500. You find
that –
(i) Sales are entered in the Sales Book on the day of dispatch and in the
Returns Inward Book on the day the goods are received back.
(ii) Purchases are entered in the Purchases Book on the day the
invoices are received.

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(iii) Sales between 31st March and 8th April as per Sales Day Book and
Cash Book ₹860.
(iv) Purchases between 31st March and 8th April as per the Purchases
Book are ₹600 but goods amounting to ₹200 are not received till the
stock was taken.
(v) Of goods invoiced during March, goods amounting to ₹500 were
not received till 31st March, of which goods worth ₹350 were received
between 31st March and 8th April.
1
(vi) Rate of Gross profit is 33 % on cost.
3

Ascertain the value of stock as on 31st March.

[C.U. B.Com. (Hons) 2006]

3. The value of physical stock was verified on December 23, 2022

₹4,50,000. Determine the value of closing stock as on 31.12.2022
given that the following transactions took place between 23.12.2022
and 31.12.2022:
(i) Out of purchases worth ₹60,000, goods worth ₹25,000 was
delivered on Jan. 8, 2023.
(ii) Out of the goods sent for consignment goods worth ₹15,000
remained unsold.
. [C.U. B.Com. (General) 2016—Adapted]

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4. The value of physical stock was verified on 04.04.2022 at ₹ 85,000.
Determine the value of closing stock as on 31.03.2022 for Balance
Sheet purpose given that the following transactions took place
between 01.04.2022 to 04.04.2022:
(a) Purchase between 01.04.2022 to 04.04.2022 amounted to ₹2,500,
but of these, goods worth ₹400 was not received till 04.04.2022.
(b) Sales between 01.04.2022 to 04.04.2022 amounted to ₹ 8,000.
(c) Arithmetical error in stock sheet on 04.04.2022 resulted in an
overvaluation of ₹ 700.
(d) Rate of gross profit is 25% on sales.

5. Pricing of Issue of Materials and Valuation of Stock

Use of LIFO, FIFO, Simple Average and Weighted Average method
From the following transactions work out the value of closing stock on
31 March, 2008 [assuming FIFO method of pricing issues]
Date Transaction Quantity Rate per unit
2008 (units) (₹)
March 1 Opening Stock 300 9.70
9 Purchases 250 9.80
15 Issues 400 —
25 Purchases 300 10.05
31 Issues 210 —

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Provision for Doubtful Debts {Approx 5 Marks}
Problem-1: From the following information, prepare Provision for Bad
debt A/c and Provision for Discount Allowed A/c in the Books of Tooba
Niyaz, a Merchant of Delhi:
Amt (Rs)
Debtors (31.12.2020) 5,00,000
Bad debt for the year 2020 10,000
Discount allowed for the year 2020 2,000
Provision for Bad Debt (01.01.2020) 5,000
Provision for Discount allowed (01.01.2020) 2,500
Additional information:
(a) Further Bad debt Rs. 2,000
(b) Cheque dishonoured Rs. 5,000
(c) Mr. Abhisekh Das included in the List of Debtors Rs. 10,000 and its
Creditors Rs. 8,000.
Create Provision for Bad debt @ 8% and Provision for Discount allowed
@5%.

Problem-2: Trial Balance as on 31.12.2020 of Mr. R. Sen contains the

following items:
Amt (Rs)
Sundry debtors 1,40,000
Bad debts written off 10,000
P.B.D (1.1. 2019) 15,000
On enquiry it was ascertained that Debtors include:
(i) ₹ 20,000 due from S. Roy and Creditors include Rs. 15,000 due to S. Roy.
(ii) Rs. 8,000 due on account of sale of furniture.

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(iii) Bad debts Rs. 8,000.
Prepare Provision for doubtful debt Account and debt Account.
Provision for doubtful debts is to be created at 5% on trade debtors.

Capital and Revenue Expenditure [5 Marks]

(a) Name the particular nature of expenditure in the following cases:
1. ₹25,000 incurred for overhauling the engine of a second hand car
purchased by him.
2. ₹20,000 paid to solicitors for preparing title deeds of a property
purchased.
3. ₹16,000 spent for removing stock to new business site.
4. Freight and carriage paid ₹2,000 on new machine.
5. ₹8,000 paid for dismantling an old machine and replacing it by a new
machine.
[Hints: (1) Capital, (2) Capital, (3) Revenue, (4) Capital, (5) Capital]

(b) State with reasons the nature of expenditure or receipts in each of

the following cases:
(a) Freight on new machine ₹4,000 and its installation cost ₹2,000.
(b) Old Furniture sold for ₹700 (cost ₹4,000 but written down value ₹900).
(c) ₹4,000 spent to double the production capacity of a machine.
(d) Compensation paid to a retrenched employee ₹2,000.
(e) 1,00,000 spent for increasing the sitting capacity of a cinema hall
and ₹5,000 paid for painting it.

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