Government of Karnataka

Department of School Education

(Pre-University)

REVISED QUESTION BANK

2024-25

Subject :
Accountancy (30)

I PUC
 REVISED QUESTION BANK
COMMITTEE MEMBERS
Coordinator
Sri. Mahabaleshwara Tunga
Principal, Soundarya Composite PU College, AN 0436
Havanur extension, Bengaluru-73

Members
Sri. L G Kumbar
Senior lecturer, Govt. P U College for Boys EE0025
Vijayapura

Sri.V L Kamakar
Senior lecturer, Govt. SSCA PU College - DD0201
K K Koppa, Taluk, District Balagavi.

Sri Sanjeeva
Selection Grade Lecturer - SU0055
Viveka PU College, Kota, Udupi.

Smt. Lakshmi M K
Senior Lecturer, Govt.P.U. College for Girls, Hiriyur – GG0299
Chitradurga District.

**********-------**********

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please mail at puebnewrevisedqb@gmail.com and academic.pue@gmail.com. There is no guarantee
that only the questions from this question bank would appear in the examination conducted by the
department.
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The copyrights of the question bank lies with the Director, Department of School Education
(Pre-University). The question bank is prepared for academic purpose only. No part of the question
bank is allowed to be used for commercial gains.
 INDEX

Chapter Name of Chapter Page No. Page No

No. From To

01. INTRODUCTION TO ACCOUNTING 01 04

02. THEORY BASE OF ACCOUNTING 05 08

03. RECORDING OF TRANSACTIONS – I 09 18

04. RECORDING OF TRANSACTIONS – II 19 48

05. BANK RECONCILIATION STATEMENT 49 60

06. TRIAL BALANCE AND

RECTIFICATION OF ERRORS 61 71

07. DEPRECIATION, PROVISIONS

AND RESERVES 72 81

08. FINANCIAL STATEMENTS – I 82 90

09. FINANCIAL STATEMENTS – II 91 110

*****-----*****
 CHAPTER - 01

INTRODUCTION TO ACCOUNTING

PART - A
One Mark Questions:
I. Multiple Choice Questions:
1] Which of the following is not a business transaction?
a] Bought furniture for `10,000 for business
b] Paid `5,000 as salaries of employees
c] Paid `20,000 towards son’s fees from Personal Bank account
d] Paid `2,000 towards son’s fees from the business

2] Deepti wants to buy a building for her business. Which of the following is
the relevant data for her decision?
a] Similar business acquired the required building in 2020 for `10,00,000
b] Building cost details of 2015
c] Building cost details of 2005
d] Similar building cost in August 2023 `25,00,000

3] Which is the last step of accounting as a process of information

a] Recording of data in books of accounts
b] Preparation of summaries in the form of financial statements
c] Communication of information
d] Analysis and interpretation of information

4] Which qualitative characteristics of accounting information is reflected when

accounting information is clearly presented?
a] Understandability
b] Relevance
c] Comparability
d] Reliability

5] Use of common unit of measurement and common format of reporting

promotes
a] Comparability
b] Understandability
c] Relevance
d] Reliability

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 6] Management accounting
a] Is a clerical work
b] Is accounting for future
c] Is a recording technique of management related transactions?
d] Is an analysis of the past business activities?

7] Which of the following shows the financial position of the business?

a] Profit and Loss account
b] Total Debtors account
c] Balance sheet
d] Funds flow statement

8] Functions of accounting include

a] Keeping systematic record
b] Protecting properties of the business
c] Ascertain the profit and loss
d] All of these

9] Accounting records transactions in terms of

a] Selling units
b] Monetary units
c] Production units
d] Marketing Units

10] It is the Language of business

a] Accounting
b] Financial statements
c] Accounting assumptions
d] Book-keeping

II. Fill in the blanks:

1] __________ is the first book on double entry book keeping.

2] The term ‘Debit’ comes from the Italian word____________

3] The term ‘Credit’ comes from the Italian word____________

4] Koutilya, a minister in Chandragupta’s Kingdom wrote a book on

economics named_____

5] Determining the transaction to be recorded is _________

6] Business Organization involves ___________ events.

7] Recording is made in a ________________ order

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 8] Accounting is the language of ______________

9] _________________ are the internal users of an organization.

10] Sub-disciplines within the accounting discipline are: financial accounting,

Cost accounting and ___________.

III. Match the following

A B

a] Economic Events i) Individual existence

b] Expenses ii) products

c] Discount iii) Costs incurred by a business

d] Goods iv) Payment of monthly rent to the landlord.

e] Documentary evidence v) deduction in the price of the goods

vi) Voucher

IV. Very Short Answer Questions:

1] Expand AICPA
2] Expand AAA
3] What is revenue?
4] What is transaction?
5] Write the meaning of capital.
6] State the meaning of gain.
7] What is loss?
8] Who are Debtors?
9] Who are Creditors?
10] What is trade discount?

1] It provides information for judging management’s ability to utilise resources

effectively in meeting goals. (State true or false)

2] Profit represents excess of revenue over expenses. (State true or false)

3] Entity is reality that has a definite individual existence. (State true or false)

4] Current assets are assets on a long-term basis. (State true or false)

5] Voucher is not a documentary evidence of a transaction. (State true or false)

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 PART-B
Two marks questions:
1] Define Accounting.
2] State any two objectives of Accounting.
3] Name any two users of Accounting
4] State the nature of Accounting information required by long term lenders
5] Enumerate any two information needs of management
6] Give any two examples of revenues.
7] Give two examples of short term liability
8] What are expenses?
9] What are fixed assets?
10] What are current assets?
11] What is capital?
12] What is revenue expenditure?

Key answer for short questions :

MCQ
1] c 2] d 3] c 4] a5] a 6] b 7] c 8] d 9] d 10] a

FILL IN THE BLANKS

1] Summa 2] Debito 3] credito
4] Arthashasthra 5] identification 6] economic
7] chronological 8] business 9] Management,
10] management accounting.

MATCH THE FOLLOWING

a] vi b] iii c] v d] ii e] vi.

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 CHAPTER - 02

THEORY BASE OF ACCOUNTING

PART - A
One Mark Questions:
I. Multiple Choice Questions:
1] According to which concept the owner of the business is considered creditor of
the business:
a] Money measurement concept
b] Dual Aspect concept
c] Separate entity concept
d] Going concern concept
2] A concept that a business enterprise will not be sold or liquidated in near future
is known as,
a] Going concern
b] Economic entity
c] Monetary unit
d] Non-monetary unit
3] According to the Going concern concept the time period of Business is,
a] For certain life time
b] For un- certain life time
c] Going to wind-up shortly
d] Going to windup permanently
4] Accounts are regularly made after a fixed period usually a year, this concept is
based on,
a] Accounting Period
b] Dual Aspect
c] Cost
d] Business entity
5] Accounting equation is based on,
a] Cost concept
b] Separate entity concept
c] Dual aspect concept
d] Accrual concept

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 6] The basis of accounting in which revenue and expenses are recognized in period
in which they are earned or incurred and not when money is received or paid,
a] Cash basis
b] Accrual basis
c] Mixed basis
d] All of the above
7] By the misuse of which convention ‘Secret Reserve’ is created.
a] Conservatism
b] Materiality
c] Consistency
d] Full Disclosure
8] Provision for bad & doubtful debts is created in anticipation of actual bad debts
on the basis of,
a] Business entity concept
b] Conservatism concept
c] Accrual concept
d] Full disclosure concept
9] Insignificant events are not recorded in the books of accounts due to,
a] Accrual concept
b] Conservatism concept
c] Money measurement concept
d] Materiality concept
10] According to which concept all expenses are matched with the revenue of that
period:
a] Realization concept
b] Money measurement concept
c] Matching concept
d] Business entity concept

II. Fill in the blanks:

1] In order to maintain uniformity and consistency in Accounting records, certain
_________have been developed which are generally accepted by the Accounting
profession.
2] The accounting records are made in the books of accounts from the point of view
of the _______and not that of the owner.

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 3] The Concept of going concern assumes that a business firm would continue to
carry out its _______indefinitely.
4] _________concept refers to the span of time at the end of which the financial
statements of enterprise are prepared.
5] The cost concept requires that all assets are recorded in the books of accounts at
their_________price.
6] Adoption of historical cost brings in _________in recording as the cost of acquisition
is easily verifiable from the purchase documents.
7] Assets = Liabilities + ________
8] Matching Concept states that expenses incurred in an accounting period should
be matched with ______during that period.
9] _____ Concept requires that all material and relevant facts of an enterprise must
be fully and completely disclosed in the financial statements.
10] _______system is not a complete system of maintaining records of financial
transactions.
11] The regulatory body for Standardization of accounting policies in the country is
_________
12] GST is a destination based tax on ____ of goods and services.

III. Match the following

A B
a] Accounting period i) Matching concept
b] GST ii) Basic assumptions
c] Focus on material facts iii) Destination based tax
d] ICAI iv) Materiality Concept
e] Accounting Concepts v) Regulatory body
vi) Basic Accounting Concepts
IV. Very Short Answer Questions:
1] State any one Basic Accounting Concept.
2] State the basic accounting equation.
3] State any one system of Accounting.
4] What is materiality concept?
5] Give the meaning of dual aspect concept.
6] Expand GAAP.
7] Expand ICAI.
8] Expand GST.
9] Expand CGST.
10] Expand SGST.

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 11] In accounting all economic events are recorded in the books of accounts.
(State True or False)
12] Accounting principles are in written statements. (State True or False)
13] Accounting standards are not creating uniformity in accounting system.
(State True or False)
14] Basis of Accounting are cash and credit. (State True or False)
15] GST is proposed to be levied at all stages from manufacture up to final
consumer. (State True or False)
PART - B
V. Two marks questions:
1] Write the meaning of theory base of accounting.
2] Give the meaning of GAAP.
3] What do you mean by Basic Accounting Concepts?
4] Mention any two Accounting concepts.
5] State the meaning of Business entity concept.
6] Write the meaning of matching concept.
7] What do you mean by basic accounting equation?
8] Give the meaning of Double entry system of accounting.
9] What is single entry system of accounting?
10] Give the meaning of cash basis of accounting.
11] What is Accrual basis of accounting?
12] What is GST?
13] What is CGST?
14] What is SGST?
16] What is IGST?

Key answer for short questions :

MCQ
1] c 2] a 3] b 4] a 5] c 6] b 7] d 8] b 9] d 10] c

FILL IN THE BLANKS

1] Principles 2] Business unit 3] Operations
4] Accounting period, 5] Cost 6] objectivity
7] Capital 8] Revenue 9] Full disclosure,
10] single entry 11] ICAI 12] Consumption.

MATCH THE FOLLOWING

a] vi b] iii c] iv d] v e] ii

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 CHAPTER - 03

RECORDING OF TRANSACTIONS - I

PART - A
One Mark Questions:
I. Multiple Choice Questions:
1] The L.F column of journal is used to
a] Record the date on which amount posted to a ledger account
b] Record the number of ledger account to which information is posted
c] Record the number of amounts posted to the ledger account
d] Record the page number of the ledger account
2] Out of the following equations which is correct?
a] C = A + L
b] C = A - L
c] A = L - C
d] L = C - A
3] Journal records the transactions of the firm in an
a] analytical manner
b] chronological manner
c] periodical manner
d] summarized manner
4] Ledger book is popularly known as
a] Secondary book of accounts
b] Principal book of accounts
c] Subsidiary books of accounts
d] None of the above
5] Ledger records transaction in
a] Chronological order
b] Analytical order
c] Both the above
d] Ascending order

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 6] Goods worth `50000 were sold to Manoj @15% discount on credit. Manoj’s
account will be debited
a] By `7500
b] By `42500
c] By `50000
d] By `57500
7] Debit signifies
a] Decrease in assets account
b] Increase in liabilities
c] Increase in expenses account
d] Increase in capital
8] What is the nature of drawing goods?
a] Income
b] Expense
c] Introduction of capital
d] Withdrawal of capital
9] Goods worth `21000 distributed as free sample. The account to be credited is
a] Purchase account
b] Sales account
c] Free sample account
d] P and L account
10] Income tax worth `5000 of the proprietor paid by a firm, the account to be
debited is
a] Income tax account
b] Bank account
c] Drawing account
d] Expenses account
11] Rent paid to landlord is credited to
a] Rent account
b] Landlord account
c] Cash account
d] Bank account
12] Voucher is prepared for
a] Cash received and paid
b] Cash/ credit sales
c] Cash/ credit purchase
d] All kind of recording

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 13] Voucher is prepared from
a] Documentary evidence
b] Journal
c] Ledger
d] Transaction
14] The book in which all accounts are maintained is known as
a] Cash book
b] Journal
c] Purchase book
d] Ledger
15] Journal entry to record salaries will include
a] Debit salaries, credit cash
b] Debit capital, credit cash
c] Debit cash, credit salary
d] Debit salary, credit creditor.

II Fill in the blanks:

1] Business transactions are exchanges of economic _______ between parties.
2] A document which provides evidence of the transactions is called the ______
3] A transaction with one debit and one credit is a_________ transaction.
4] Voucher which records a transaction that entails multiple debits/credits and one
credit/debit is called ___________ voucher.
5] Accounting equation signifies that the assets of a business are always equal to
the total of its liabilities and _________.
6] Every debit must have a corresponding ___________.
7] The process of recording transactions in a journal is called ___________.
8] The process of transferring journal entry to individual account is Called________.
9] Journal is a book of _____________.
10] A brief description of the transaction is called the ____________.
11] When only two accounts are involved to record a transaction, it is called a _____.
12] The goods account is divided into __________accounts.
13] When the number and accounts to be debited or credited is more than one the
transaction is called _________ journal entry.
14] All permanent accounts appear in the ________.
15] All revenue and expenses are ________ accounts.

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 III Match the following
A B
a] Liabilities i. Transaction with the multiple debits/credits
and one credit/debit transaction
b] Compound voucher ii. Claim outsiders
c] Increase in asset iii. GST
d] Central goods and service tax iv Debit
e] Goods and Service Tax v. Credit
vi. CGST

IV Very Short Answer Questions

1] Give an example of a voucher.
2] What is Ledger?
3] What is a debit voucher?
4] What is a credit voucher?
5] Write the meaning of the Balance sheet.
6] Who provides resources for the business?
7] What is capital?
8] State the meaning of the journal.
9] What is narration?
10] What do you mean by debit balance?
11] Business transactions have a single effect. (state true or false)
12] Vouchers must be preserved till the audit of the accounts. (state true or false)
13] The Balance Sheet is the statement of Assets, Liabilities and Capital.
(state true or false)
14] All accounts are divided into four categories. (state true or false)
15] L.F. is filled-up at the time of posting. (state true or false)

PART - B
V. Questions for Two marks:
1] What do you mean by source document or voucher?
2] What do you mean by compound voucher?
3] What do you mean by complex transaction?
4] What is double entry accounting?
5] Why is the evidence provided by the source document important to accounting?
6] Should a transaction be first recorded in a journal or ledger? Why?

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 7] Give the specimen of an Account.
8] Give the specimen of journal.
9] Give the journal entry for goods distributed as free samples.
10] Distinguish between source documents and vouchers.

PART - C
VI. Six Marks Questions:
1] State the rules of debit and credit for Incomes, Expenses, Capital, Liabilities and
Assets.
2] Prepare Accounting Equation on the basis of the following:
a] Harish started business with cash `2,00,000
b] Purchased goods from Naman for cash `1,40,000
c] Sold goods to Bhanu costing `10,000
3] Prepare Accounting Equation on the basis of the following:
a] Kunal started business with cash `2,50,000
b] He paid commission of `2,000
c] He sold goods (costing `20,000) for `22,000
4] Mohit has the following transactions, prepare Accounting Equation:
a] Business started with cash `1,00,000
b] Purchased office furniture for office use `10,000
c] Cash withdrawn for personal use `20,000
5] Rohit has the following transactions. Prepare Accounting Equation:
a] Commenced business with cash `2,00,000
b] Purchased machinery on credit `25,000 from Mohit Traders
c] Repair charge on machinery `2,500
6] Use Accounting Equation to show the effect of the following transactions of Ravi
Traders.
a] Started business with cash `1,00,000
b] Goods destroyed by fire `13,000
c] Paid for charity `200
7] Transactions of Mohan Traders are given below. Show the effects of these
transactions on assets, liabilities and capital with the help of Accounting
equation. (For Practice purposes only)
a] Business started with cash `1,00,000
b] Cash purchase `50,000

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 c] Cash sale of `60,000
d] Purchase furniture for cash `5,000
e] Paid rent `4,000
f] Bought from Ratan `8,000
8] Prepare accounting equation from the following transactions:
a] Started business with cash of `1,00,000
b] Bought from Navin Traders `50,000
c] Returned goods to Navin Traders `5,000
d] Cash paid to Navin Traders `43,000 in full settlement.
e] Opened Bank Account with `5,000
f] Withdrawn from Bank `2,000 for office use.
(For Practice purposes only)
9] Classify the following Accounts into Assets, Liabilities, Capital, Expenses/Losses
and revenue/gains:
a] Cash A/c b] Purchases A/c
c] Drawings A/c d] Computer A/c
e] Building A/c f] Salary A/c
g] Interest on Investment A/c h] Sales A/c
i] O/S salary A/c j] Creditors A/c
k] Purchases Returns A/c l] Bills Receivable A/c
10] Classify the following into Assets, Capital, Expenses/Losses and Revenue/Gains
under Accounting Equation Method
a] Furniture A/c b] O/S Rent A/c
c] Bad debt A/c d] Interest Receivables A/c
e] Rent received in advance f] Prepaid salary A/c
g] Capital A/c h] Bills Payable A/c
i] Investment A/c j] Sales return A/c
k] Bank Overdraft A/c l] Debtors A/c
11] Prepare the ledger Account from the following transactions and balance the
same. (For Practice purposes only)
01.01.2023 Started business with cash `10,000
10.01.2023 Cash purchases ` 5,000
20.01.2023 Goods sold for cash `8,000
25.01.2023 Deposited cash into bank `24,000.

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 PART – D
VII. Twelve marks problems:
1] Journalise the following transactions of Swaroop Traders:
2023 Jan 1) Business started with cash `1, 00,000
Jan 2) Opened bank Account with SBI ` 5000
Jan 5) Purchased goods for cash `10,000
Jan 8) Sold goods to Suma `20,000
Jan 10) Goods returned from Suma `2, 000
Jan 15) Cash received from Suma `17,500 in full settlement of
her Account
Jan 20) Paid for stationary `1,000
Jan 23) Paid rent by cheque `4,000
Jan 25) Drew for personal use `3,000
Jan 28) Purchased furniture on credit from Siddeshwar Steels,
Hubli `10, 000
Jan 30) Salary outstanding `60,000

2] Journalise the following transactions of Anant Traders:

2023 Jan 1) Started business with cash `80, 000
“ Jan 3) Cash Purchases `25,000
“ Jan 5) Cash Sales `20,000
“ Jan 8) Goods destroyed by fire `3,000
“ Jan 10) Sold goods for cash (costing `6,000) `9,000
“ Jan 12) Prepaid insurance `2,000
“ Jan 15) Sold goods to Ashu (Cost `7,000) `9,000
“ Jan 18) Cash received from Ashu `6,000
“ Jan 21) Invested in shares of Tata Co. Ltd `5, 000
“ Jan 23) Paid cash for household expenses `8,000
“ Jan 25) Bought computer for office use `10,000
“ Jan 28) Commission received in advance `7,000

3] Journalise the following transactions

a] Started business with Cash ` 2,30,000
Goods ` 1,00,000
Buildings ` 2,00,000
b] Bought goods for cash `5,000
c] Sold goods (costing `30,000) `35,000
d] Purchased goods from Rahul `55,000

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 e] Sold of goods to Varun (costing `50,000) `60,000
f] Paid cash to Rahul in full settlement `53,000
g] Received cash from Varun in full settlement `59,000
h] Depreciation charge on building `10,000
i] Fresh capital introduced `50,000

4] Journalise the following transaction in the books of Harpret Brothers

2023 Jan 1) Started business with cash `1, 65,000
“ Jan 2) Bought goods from Tara `22, 000
“ Jan 5) Cash paid to Tara `22, 000
“ Jan 8) Sold goods to Nariman `12, 000
“ Jan 10) Commission received `1, 000
“ Jan 11) Salary paid `5, 000
“ Jan 15) Goods issued for house hold purpose `2,000
“ Jan 18) Cash received from Nariman `11,700 and discount
allowed `300
“ Jan 20) Cheque given for Insurance premium `1000
“ Jan 22) Furniture purchased for cash `3,000
“ Jan 25) Goods destroyed by fire `800.

5] Journalise the following transactions:

2023 Jan, 01 Commenced business with cash `5,000, stock of good
`20,000, machinery `10,000 and bills payable `1,000
” Jan,02 Borrowed `5, 000 from Arun and `10, 000 from Bharat.
“ Jan,05 Purchased goods from Charan `4,000 and
from Dhanaraj `6,000
“ Jan,15 Sold goods to Hari `8,000 and to Govind `4,000
“ Jan,20 Received cash from Hari `7,500 and
allowed him discount `500
“ Jan,25 Paid salary `2, 000 and rent `1,000

6] Journalising the following transactions

2023 Jan,01 Started business with Cash `50,000
” Jan,05 Deposited in to bank `10,000
“ Jan,07 Purchased goods from Jagadish `5,000
“ Jan,09 Sold goods to Nagaraj for cash `10,000
“ Jan,11 Paid amount to Jagadish
“ Jan,13 Paid for travelling expenses `500

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 “ Jan,15 Took goods from business for domestic use at
Selling price `1,000
“ Jan,17 Outstanding salary `800
“ Jan,20 Took loan from bank `10,000
“ Jan,22 Paid for Advertisement `2,000
“ Jan,25 Paid in as further capital `12,000
“ Jan,27 Goods distributed as free samples `800

7] Journalising the following transactions:

2023 Jan,01 Business started with cash `25,000
“ Jan,03 Opened bank Account with SBM `5,000
“ Jan,05 Bought goods from Satish on credit `7,000
“ Jan,07 Returned goods to Satish `500
“ Jan,08 Issued cheque infavour of Satish `4,000
“ Jan,10 Gave charity `500
“ Jan,15 Paid Electricity bill `750
“ Jan,18 Bought office furniture `3,000
“ Jan,20 Drew cash from Bank for personal use
“ Jan,22 Bought Postage stamps `100
“ Jan,25 Drew cash for personal use `1,000
“ Jan,28 Commission received in advance `400

8] Journalising the following transactions in the books of Shree Raju:

2023 Jan,01 Commenced business with cash `40,000
“ Jan,05 Bought goods from Ravi `10,000
“ Jan,08 Sold goods to Vinayak `15,000
“ Jan,10 Returned goods to Ravi `300
“ Jan,12 Vinayak returned us goods `300
“ Jan,15 Paid Ravi `5,000 by cash and the balance through cheque
“ Jan,18 Received cheque from Vinayak `10,000 and
the balance received by cash
“ Jan,20 Withdrawn Cash of `1, 000 and
goods worth `500for domestic use.
“ Jan,25 Paid for printing charges `500

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 9] Journalising the following transactions in the books of Rama. Post them into
the ledger and balance the same. (For Practice purposes only)
2023 Jan,01 Started business with cash ` 50,000, bank balance ` 25,000
“ Jan,02 Bought goods worth ` 20,000 less trade discount at 10%
from Naveen Trade
” Jan,05 Raj and company bought goods from us worth ` 10,000
for which a cheque was received for ` 4,000(which is paid into
bank) balance being payable within 1month
“ Jan,07 Paid to Naveen Traders cash ` 10,000 and also ` 7,500
by cheque in full settlement of Account.
” Jan,09 Received commission ` 1,000 and Interest ` 500
“ Jan,11 Paid for Rent `1,000 and Cartage `300

10] Journalising the following transactions, post them into ledger and balance the
same. (For Practice purposes only)
2023 Jan,01 Commenced business with cash `1,00,000
“ Jan,02 Cash Purchases ` 25,000
“ Jan,05 Till takings ` 40,000
“ Jan,07 Deposited into Bank `20,000
“ Jan,09 Outstanding rent ` 1,000
“ Jan,15 Cash withdrawn for personal use `2,000
“ Jan,17 Prepaid insurance `500
“ Jan,18 Commission receivable ` 800
“ Jan,20 Bank charges ` 200
“ Jan,22 Interest on Capital ` 2,000
“ Jan,25 Goods given away by Charity ` 600
“ Jan,28 Drew for office use ` 2,000

Key answer for short questions :

MCQ
1] d 2] b 3] b 4] b 5] b 6] b 7] c 8] d 9] a 10] c
11] c 12] d 13] a 14] d 15] a.
FILL IN THE BLANKS
1] Consideration 2] Source document or voucher 3] Simple transaction
4] Compound voucher 5] Capital 6] Credit
7] journalizing 8] posting 9] original entry
10] narration 11] Simple journal entry 12] five
13] Compound 14] Balance sheet 15] temporary
MATCH THE FOLLOWING
a] ii b] i c] iv d] vi e] iii

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 CHAPTER - 04

RECORDING OF TRANSACTIONS - II

PART - A
One Mark Questions:
I. Multiple Choice Questions:
1] when a firm maintains a Cash book, it need not maintain:
a] Journal Proper
b] Purchases book
c] Sales book
d] Bank and cash account in the ledger.
2] Double column cash book records:
a] All transactions.
b] Cash and bank transactions
c] Only cash transactions
d] Only credit transactions.
3] Goods purchased on cash are recorded in the:
a] Purchases book
b] Sales book
c] Cash book
d] Purchases return book.
4] The balance on the debit side of the bank column in the cash book indicates:
a] The total amount withdrawn from bank.
b] The total amount deposited in the bank.
c] Cash at bank.
d] Cash in hand
5] Cash book is a
a] Subsidiary journal.
b] Subsidiary journal and a ledger account.
c] Ledger account.
d] Journal and ledger.

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 6] Cash book does not record transaction of:
a] Cash nature
b] Credit nature
c] Cash and credit nature
d] Credit and cash nature
7] Credit balance of bank account in cash book shows:
a] Overdraft
b] Cash deposited in bank
c] Cash withdrawn from bank
d] Bank balance.
8] Cash sales are recorded in:
a] Sales book
b] Cash book
c] Journal
d] journal proper.
9] The balance of petty cash book is:
a] a liability
b] an expense
c] a gain
d] an asset
10] Cash discount is provided on:
a] prompt payment
b] Sale
c] purchase
d] delayed payment.
11] The term imprest system is used in relation to:
a] Purchases book
b] Sales book
c] Cash book
d] Petty cash book.
12] Purchases book is maintained to record:
a] Purchases of goods
b] All cash purchases
c] All credit purchases
d] All credit purchases of goods.

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 13] Sales book is maintained to record:
a] credit sales of goods only
b] cash sales of goods only
c] all credit sales
d] credit sale of assets.
14] Returns inward book records:
a] Returns of goods from factory to the godown.
b] Returns of goods from show-room to godown.
c] Returns of goods from the customers
d] Returns of goods from the suppliers.
15] Returns outward book records
a] Goods returned to the suppliers
b] Goods returned to the stores
c] Goods returned to the customers
d] Goods returned by the owner.

II. Fill in the blanks:

1] Cash book is a ___________ journal(book).
2] Assets sold on credit are entered in ___________.
3] Cash book does not record the_____________ transactions.
4] While making entries in cash book the rule of ____________account is followed.
5] Cash book is a journal as well as the ____________ account.
6] Cash book maintained to record small expenses is called____________.
7] Petty cash book is also known as________ book.
8] ____________ Book is a journal as well as ledger.
9] In two column cash book records transaction relating to _______ and__________.
10] Credit note is the basis for recording ________________book.
11] Debit note is the basis for recording ____________book.
12] Invoice is the basis for recording ____________book.
13] Outward invoice is the basis for recording ______book.
14] Fixed assets purchased for cash are recorded in ______ book.
15] Adjusting entries are recorded in____________.

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 III. Match the followings
A B
a] Credit purchase of goods i. Journal proper
b] Paid into Bank ii. Claims of outsiders
c] Transactions cannot be recorded iii. Transfer by mere delivery
in any special journal
d] Bearer cheque iv. Petty cash book
e] Imprest system v. Purchases return book
vi. Purchases book
IV. Very Short Answer Questions:
1] What do you mean by discount?
2] Mention any one feature of cash book.
3] Name any one type of cash book.
4] What do you mean by petty cash book?
5] State any one type of petty cash book.
6] What type of transaction is recorded in the purchase book?
7] What type of transaction is recorded in the sales book?
8] Name any one transaction recorded in the purchases returns book.
9] State any one transaction recorded in the sales returns book.
10] Name any one type of transaction recorded in the journal proper.
11] Cash account is a real account. (State true or false)
12] Cash book is both a ledger account and subsidiary book. (State true or false)
13] Bank column of the cash book always shows a debit balance. (State true or false)
14] Trade discounts are not recorded in books of accounts. (State true or false)
15] Purchases book and Purchases account are synonymous. (State true or false)

PART- B
V. Short Answer Questions for Two marks:
1] Name any two types of subsidiary books.
2] What is a cash book?
3] Mention any two features of a cash book.
4] What is a two column cash book?
5] What are contra entries?
6] What is a petty cash book?
7] What is a columnar petty cash book?
8] What is the imprest system for a petty cash book?
9] Give the meaning of subsidiary books.

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 10] Write the meaning of the purchased book.
11] What is an invoice?
12] Why is a debit note prepared?
13] State the meaning of sales book?
14] When do you prepare a credit note?
15] What is Journal proper?
PART - C
VI. Six Marks Questions:
I. Simple cash Book/ single column cash book:
1] Enter the following transactions in a single column cash book for the month of
December- 2023 and balance the same:
2023 `
Dec-01 cash in hand 24,000
Dec-04 cash received from Vishnu 6,000
Dec-08 Purchased goods from Vishnu for cash 4,000
Dec-10 Paid insurance 2,000
Dec-15 Sold goods for cash 8,000
Dec-18 paid rent 500
Dec-22 Purchased stationary items 4,500
Dec-25 Received commission 1,000
Dec-27 Paid salaries 2,000
Dec-31 Paid to postage 400
(Ans: Cash in hand `25600/-)

2] Record the following transactions in a simple cash book for March 2023.
2023 `
Mar-01 Balance on hand 10,000
Mar-03 Paid to Mahesh on account 3,000
Mar-06 Cash received from Ramesh 5,500
Mar-10 Purchased goods for cash 2,500
Mar-12 Paid freight charges 400
Mar-15 Sold goods for cash 7,500
Mar-18 Paid for advertisement 1,500
Mar-20 Paid into Bank 2,000
Mar-24 Paid wages 1,200
Mar-30 Paid repair charges 1,800
( Ans: Cash in hand ` 10600/-)

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 3] Record the following transaction in a simple cash book of Mr.Sundar
2023 `
Jan-01 Sundar started business with capital 2,00,000
Jan-02 Purchased machinery 50,000
Jan-06 Purchased goods for cash 1,20,000
Jan-08 Sold goods for cash 1,64,000
Jan-12 Opened a current A/c in SBI 1,00,000
Jan -16 Cash sales 82,000
Jan-20 Advertising charges paid 50,000
Jan-23 Interest received 80,000
Jan-26 Paid to Kishore 20,000
Jan-31 Rent paid for the month 8,000
(Ans: Cash in hand `151000/-)

4] Enter the following transactions in the single column cash book of Mr. Ramlal
and balance the same at the end of Feb-2023
2023 `
Feb-01 Ramlal commenced business with cash 60,000
Feb-02 Cash purchases 30,000
Feb-05 Cash sales 40,000
Feb-08 Paid for general expenses 4,000
Feb-12 Received from Meera 8,400
Feb-15 Bought furniture 10,400
Feb-20 Paid to Deepashree 9,600
Feb-24 Paid into bank 4,000
Feb-28 Paid salaries for the month 6,000
Feb-28 Cash withdrawn from business for personal use 2,000
(Ans: Balance on hand `42400/-)

5] Prepare simple cash book from the following transactions:

2023 `
March-01 Cash in hand 75,000
March-03 Purchased furniture for cash 12,000
March-06 Sold goods for cash 32,500
March-10 Paid to Mohan on account 5,000
Mrach-15 Bought goods for cash 12,000

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 March-18 Paid for stationery 1,500
March-20 Sale of old type writer for cash 1,000
March-24 Deposited into bank 25,000
March-28 Paid salary to staff 1,200
March-31 Paid for carriage on purchase 800
(Ans: Cash in hand `51000/-)

6] Enter the following transaction in simple cash book for the month of November-
2023 and balance the same:
2023 `
Nov-01 Balance on hand 8,000
Nov-02 Further capital introduced 12,000
Nov-04 Spent for private use 2,000
Nov-08 Purchased goods for cash 3,000
Nov-12 Paid to Bhaskar 5,000
Nov-16 Paid to advertisement 1,000
Nov-20 Credit sales 10,000
Nov-23 Received from Anil 6,000
Nov-27 Purchased stationery 500
Nov-30 Paid salaries 2,500
(Ans: Cash in hand `12500/-)

7] On 1st March 2023 Mr. Sharma started business with cash `15000 of this pays
`5000 into his bank account. His transactions during the month were:
2023 `
March-05 Cash sales 12,000
March-08 Cash purchases 7,000
March-12 Withdrew from bank for office use 3,000
March-15 Paid for sundry expenses 2,500
March-18 Purchase of type writer 4,000
March-20 Withdrew cash for domestic use 5,000
March-26 Paid travelling expenses 1,500
March-30 Postage paid 400
(Ans: Cash in hand ` 4600/-)

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 8] Enter the following transactions in the single column cashbook
2023 `
April-01 Balance from the last month 16,750
April-04 Sold goods for cash 32,250
April-06 Purchased furniture 8,375
April-10 Paid electric bill 1,025
April-13 Purchased TV for domestic use 16,675
April-16 Paid charity 800
April-18 Paid to printing press 260
April-21 Received from Amar 2,200
April-25 Paid water bill 525
April-30 Sent money order to his son 1,000
(Ans: Balance on hand `22540/-)
9] Prepare a single column cash book for the month of January -2023 from the
following:
2023 `
Jan-01 Opening cash balance 15,280
Jan-03 Received from Rahul on account 4,550
Jan-06 Paid to Kiran on part settlement of his A/c 1,275
Jan-10 Repaid bank loan 6,000
Jan-12 Paid wages to house servant 1,250
Jan-15 Bought additional capital 5,000
Jan-18 Borrowed from vijaya bank 10,000
Jan-21 Purchased vehicle for office use 8,250
Jan-24 Sold goods to Dinesh at 10% discount 4,000
Jan-31 Deposited into vijaya bank 3,550
(Ans: Cash balance `18105/-)

10] Record the following transactions in a simple cash book:

Date Particulars `
01.01.2023 Balance of cash in hand 18,000
04.01.2023 Purchased goods for cash form Subbanna 3,000
08.01.2023 Sold goods to chadrappa for cash 4,000
10.01.2023 Cash received from Rajanna 1,000
15.01.2023 Paid power charges to KPTCL 500
18.01.2023 Paid commission to Ramappa 800
20.01.2023 Paid miscellaneous expenses to Gundappa 200
23.01.2023 Paid to Ranganath 4,500
26.01.2023 Paid salary to Rajakumar 1,500
31.01.2023 Paid rent to Rajanikanth 2,600

(Ans: Cash in hand `9900/-)

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 II. Problems on double column cash book
11] Enter the following transactions in double column cash book of M/S Naveen
Trades for March -2023:
Month Date Particulars `
March 01 Bank balance 4,400
March 01 Cash balance 17,000
March 03 Purchased furniture by cheque 12,000
March 08 Sold goods for cash 13,000
March 12 Purchased goods for cash 5,000
March 15 Cheque received from Rahul (Deposited same day) 9,500
March 20 Cash withdrew from bank 2500
March 25 Paid salary 3400
March 31 Rent paid by cheque 2,600
(Ans: Cash in hand `24100/- cash at bank `36400/-)
12] Prepare a double column cashbook with the help of the following transactions for
December-2023:
Month Date Particulars `
Dec 01 Cash in hand 22,500
Dec 01 Cash in bank 10,000
Dec 02 Purchased goods for cash 4,000
Dec 05 Paid insurance by cheque 2,000
Dec 09 Deposited in bank 5,000
Dec 13 Cash received for sale of goods 12,000
Dec 18 Received cheque from Joseph 3,000
Dec 24 Joseph’s cheque deposited into bank
Dec 30 Withdrew cash for personal use 1,000
(Ans: Cash in hand `24500/- Cash at bank `16000/-)

13] Record the following transactions in a double column cash book for January-
2023 and balance the same:
Month Date Particulars `
Jan 01 Commence business with cash 1,00,000
Jan 03 Opened a current A/C with SBI 50,000
Jan 05 Purchased goods for cash 10,000
Jan 10 Purchased machinery by cheque 15,000
Jan 15 Cash deposited into bank 4,000
Jan 18 Sold goods for cash 6,000
Jan 22 Paid cartage by cheque 2,000
Jan 31 Withdrew from bank for office use 3,000
(Ans: Cash in hand `45000/- Cash at bank `34000/-)

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 14] Prepare a double column cash book from the following transaction February-
2023:
Month Date Particulars `
Feb 01 Cash in hand 7,500
Feb 01 Bank overdraft 12,500
Feb 03 Paid wages 600
Feb 07 Goods purchased and paid by cheque 2,400
Feb 12 Cash paid into bank 5,000
Feb 16 Cash sales 8,000
Feb 21 Paid establishment expenses by cheque 1,500
Feb 28 Commission received 2,500
(Ans: Cash in hand `12400/- Bank overdraft `11400/-)

15] Record the following transactions in double column cash book and balance it:
Month Date Particulars `
Aug 2023 01 Cash balance 20,000
Bank Balance 15,000
Aug 08 Paid into bank 5,000
Aug 10 Cash sales 18,000
Cash discount 180
Aug 12 Paid telephone bill by cheque 1,500
Aug 21 Payment for cash purchases 4,000
Cash discount 40
(Ans: Cash in hand `29000/- Cash in bank `18500/-)
16] Prepare bank column cash book from the following transactions of
M/S modern Associates for the month of june-2023:
Month Date Details `
2023
June 01 Cash in hand 8,000
Bank overdraft 6,400
June 05 Purchased goods by cheque 4,000
June 10 Cash sales 14,000
June 15 Purchased type writer for office by cash 3,200
June 20 Withdrew from bank for personal use 1,800
June 24 Paid insurance premium by cheque 1,000
June 26 Paid rent 800
June 30 Interest charged by bank on overdraft 500
(Ans: Cash in hand `16200/- Cash at bank `11900/-)

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 17] Prepare two column cash book of M/s Unique Software LTD., for the month of
October-2023 from the following transactions:
Month Date Particulars `
Oct 01 Cash in hand 6,050
Cash in bank 13,760
Oct 06 Deposited into bank 2,250
Oct 10 Purchased goods for cash 5,750
Oct 14 Cash sales deposited into bank on the same day 3,460
Oct 19 Received cheque from Prema 4,440
Oct 22 Prema’s cheque deposited into bank
Oct 26 Paid trade expenses 250
Oct 31 Bank charges 150
(Ans: Cash in balance `1460/- Bank balance `20300/-)

18] Record the following transactions of M/S Surya and Arya in a double column
cash book for March-2023
Month Date Particulars `
March 01 Opening cash balance 25,000
Opening bank balance 31,000
March 04 Received cheque from Suresh and deposited 15,000
into bank
March 12 Sold goods to Anand for cash 7,500
March 15 Drew cash from office for household expenses 2,500
March 18 Suresh’s cheque returned dishonoured
March 21 Paid for carriage 1,200
March 27 Bought computer and issued cheque 18,000
March 31 Paid electric bill 1,800
(Ans: Cash Balance `27000/- Bank balance `13000/-)

19] Prepare double column cash book from the following transactions and balance
the same:
Month Date Particulars `
2023
Nov 01 Balance of cash in hand 15,000
Cash at bank 1,20,000

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 Nov 03 Received cash from Ramesh 20,000
Nov 08 Paid to Suresh by cheque 18,000
Nov 14 Drew for office use 10,000
Nov 19 Goods withdrawn from the business for
personal use 5,000
Nov 22 Paid rent to land lord 6,000
Nov 26 Cash sales 17,000
Nov 30 Paid salaries to staff 12,000
(Ans: Cash in hand `4400/- Cash at bank `92000/-)

20] Record the following transactions in double column cash book and balance it:
Month Date Particulars `
2023
Feb 01 Started business with cash 10,000
Feb 04 Opened a current A/C in Indian bank. 5,000
Feb 08 Purchased goods for cash 2,000
Feb 10 Sold goods on credit to Mohan 3,000
Feb 14 Paid for stationary by cheque 1,500
Feb 20 Cash sales deposited into bank 18,000
Feb 24 Bought furniture and payment made by cheque 6,000
Feb 28 Paid wages to watchman 1,200
Ans: Cash in hand `1800/- Cash at bank `23000/-

III. PROBLEMS AND PETTY CASH BOOK

21] Prepare a petty cash book from the following information.
The imprest amount is `1,000.
Date Particulars `
2023
Jan. 01 Paid cartage 60
Jan. 03 Postage 50
Jan. 06 Refreshments to customers 110
Jan. 10 Courier charges 80
Jan. 12 Pen pencil and rubber 30
Jan. 15 Telegram charges 115
Jan. 18 Miscellaneous expenses 50
Jan. 22 Fax charges 70
Jan. 26 Auto charges 65
Jan. 31 Purchased Stationary 90

(Ans: Petty cash balance `280/-)

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 22] Enter the following transactions in the petty cash book under the imprest
system and balance the same:
Date Particulars `

2023

August 01 Received an Imprest cheque worth 200

04 Paid for stationery 20

08 Purchased postal stamps 10

12 Paid cartage and coolie 16

15 Purchased paper and pencils 40

20 Paid taxi charges 50

24 Paid tips to peons 5

27 Register post charges 10

30 Tea charges 28

31 Sent telegrams 10

Ans: Petty cash balance `11/-)

23] Record the following transactions in the petty cash book under imprest
system:
Date Particulars `

2023
January 01 Received cash from head cashier 1,000
03 Spent for postage 58
07 Travelling expenses to the manager 75
09 Paid for office cleaning 98
12 Paid subscription to news papers 80
15 Messaging charges 30
18 Auto fare 25
20 Xerox charges 40
26 Refreshments to customers 50
31 Cartage 20
(Ans: Petty cash balance `524/-)

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 24] Enter the following transactions in the petty cash book under the Imprest
system and balance it.
Date Particulars `
2023
Feb 01 Received a cheque towards petty cash 500
02 Paid cartage on goods 25
06 Paid taxi fare 70
08 Postage and Telegram 30
12 Stationery purchased 65
15 Wages paid 50
17 Paid for repairs to chairs 75
20 Registered parcel charges 50
26 Bus fare 10
28 Coffee expenses 30
(Ans: Petty cash balance `95/-)
25] Prepare petty cash book from the following particulars under Imprest
system.
Date Particulars `
2023
July 01 Received cash from main cashier 120
03 Purchased stationery 20
06 Paid for charity 10
07 Paid newspaper bill 20
09 Paid coolie 12
12 Postal expenses 8
14 Paid for cart hire 4
25 Auto fare 18
30 Carriage expenses 5
31 Refreshment expenses 5
(Ans: petty cash balance `18/-)
26] Enter the following transactions in the petty cash book on the Imprest system
and balance the same:
Date Particulars `
2023
April 01 Received cheque from cashier 600
02 Paid for bus tickets 75
05 Paid for cleaning office floor 40
08 Purchase of envelopes 30
10 Courier charges 20
12 Sent telegram 45
16 Bought white sheets 25
19 Tea expenses 30
22 Paid coolie 50
30 Auto charges 20

(Ans: Petty cash balance `265/-)

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 27] Prepare petty cash book from the following particulars with imprest system
and balance the same:
Date Particulars `
2023
Sept 01 Main cashier issued a cheque to petty cashier 400
02 Paid electricity charges 30
06 Xerox charges 25
08 Trunk call charges 40
10 Paid railway fright 50
14 Bought post cards and inland letters 25
18 Paid for computer stationery 20
20 Coffee expenses 15
26 Paid charity 10
30 Paid cartage 25
(Ans: Petty cash balance `160/-)

28] Enter the following transactions in the petty cash book under Imprest system:
Date Particulars `
2023
Dec 01 Received cash from head cashier 300
04 Sent telegrams 25
08 Bought ink and pens 30
12 Auto fare 20
16 Courier charges 15
20 Paid for coolie 30
23 Travelling expenses 35
26 Tiffin charges 20
29 News paper bill 25
31 Tips to peons 10
(Ans: petty cash balance `90/-)
Note: It is advised to consider any 5 transactions including opening
balance for 6 marks

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 IV. PROBLEM ON PURCHASES BOOK
29] Enter the following transactions in the purchases book/journal of
M/S Jain traders:
Date Particulars `
2023
Jan 01 Purchased goods from Mr. Suresh 10,000
Jan 09 Credit purchases from Mr. Santhosh 20,000
Less 10% trade discount
Jan 11 Purchased from Mahesh traders 8,000
Jan 16 Purchased office furniture from Bengaluru
Furniture 15,000
Jan 26 Bought goods from Girish
Less 5% trade discount 28,000
Ans: `62,600.

30] Enter the following transactions in the purchases book of Samarth traders
Date Particulars
2023
Feb 01 Purchased from Mandya sugar mills,10 quintals
of sugar at `3500 per quintal
Feb 10 Bought 25 quintals of rice from Bharath mills,
Belgaum at `3000/-per quintal at 10% discount
Feb 20 Bought Furniture of `15,000 from Modern
furniture on credit
Feb 25 Bought wheat from Akhil and co., 15 quintals at
`2,500/- per quintal at 8% trade discount
Feb 28 Purchased 5 tins of coconut oil from Mangaluru
Stores at `2,000/- per tin
Ans: `1,47,000.

31] Prepare purchases book from the following transactions of Saraswathi Book
house.
2023
June 01 Purchased 50 Accountancy Books at `150 per book from
Sapna book house

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 June 05 Bought 25 business studies books at `100 per book and 50
Economics books at `100 per book from Matha publishers
at 5% discount.
June 12 Purchased 500 note books from siddi suppliers for `30 per
Note book at 10% discount.
June 18 Bought 10 packs of pens from Subhash book house
at `120 each for cash.
June 25 Bought 10 dictionaries at `100 each
from Chethan publications.
Ans: ` 29,125.

32] Record the following transactions in purchase journal of city stationeries For
the month of July 2023.
2023
July 01 Bought from Ravindra traders as per invoice no.431:
10 Note books at `25 each
20 Registers at `50 each, less trade discount @ 6%.
July 05 Purchased from Gokul stationeries as per Invoice no. 515:
20 colour books at `75 each
100 packs of pens at `40 each Trade discount 5%.
July 15 Purchased 20 colour pencil boxes from Ganga stationeries
@ `120 Per box.
July 18 Purchased Xerox machine of `20,000/- from
Adiswar electronics
July 22 Purchased 25 calculators from Global Electronics
at `100 each.
Ans: `11,300.

33] Enter the following transactions in the purchases book:

2023
April 01 Purchased from Mr. Balu, Bijapur, 10 quintals of jawar at
` 3,000/- Per quintal at 20% trade discount.
April 08 Shubha mills sold us 12 quintals of small rice at `3,500/- per
Quintal and paid transportation charges of `500.
April 14 Purchased from Bindhu mills 15 quintals of big rice at `500
Per quintal.
April 20 Purchased from Star mills 10 bags of wheat @ `3,000 per bag

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 35 | P a g e

 for Cash.
April 26 Bought 50 kg moong from Ganesh traders at `50 per kg.
Ans: `1,06,500.

34] Prepare purchases book for the month of January 2023.

2023
Jan 01 Purchased goods from Rajesh `8,000.
Jan 08 Bought goods from Ramesh `20,000/- less 5% trade discount.
Jan 10 Bought Vehicle from Maruti co. on credit
Jan 19 Purchased from Lakshmi traders for `5,000 on credit.
Jan 24 Purchased goods from Mr. A for `4,000 less 10% trade discount.
Ans: ` 45,600.

35] Prepare the purchases book for the month of March 2023 in the books of
Krishna provision stores
2023
March 02 Purchased 20 packs of Biscuit at `100 each from Sunfeast ltd.,
March 11 Bought 10 bags of Tea powder at `1000 each less trade
discount of 10%.
March 15 Bought 10 packs of chocolate at `250 each from
Lakshmi Chocolate stores at 2% discount.
March 21 Bought 10 bags of detergent powder at `500 per bag from
Hari traders.
March 28 Purchased 10 boxes of soap at `200/- per box from
Shiva Traders for cash.
Ans: ` 20,450.

36] Prepare the purchases book for the month of sept.2023 in the books of Pooja
stationeries.
2023
Sept.01 Purchased 10 dozens of note books from Geetha publishers
for `5,000 less 5% trade discount.
Sept.04 Bought pens and Pencils from Vasavi stores `1,500.
Sept.13 Cash purchases from Dhathri stores `4,000.
Sept.17 Bought from Mr.Kiran `6,000 at 10% discount.
Sept.24 Bought Charts and graphs from Sreenidhi publishers for `500.
Ans: `12,150.

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 37] Prepare purchases book from the following transactions:
2023
Dec.01 Purchased goods from Sundar for `8,000/- on account.
Dec.08 Bought goods from Pradeep for `4,000/-on credit at 10% discount.
Dec.11 Purchased one printer for `8,000 from New computers.
Dec.21 Bought goods from Ankith `3,500.
Dec.24 Purchased goods from Manjunath `8,000/.
Dec.27 Purchased goods from Nagendra for `2,500.
Ans: `25,600.
38] From the following transactions prepare purchases book for the month of
jan.2023 in the books of Janatha Furnitures.
2023
Jan.01 Purchased from New furnitures 10 tables at `2,500 each.
Jan.08 Purchased from Arun furnitures 20 chairs at `1,000/- each at
a 5% discount.
Jan.13 Bought 10 dining sets from Royal king furniture at `6,000 each
at a 10% discount.
Jan.20 Bought 10 Bureau from Lakshmi works at `10,000/- each for cash.
Jan.28 Varun Furnitures sold us 10 TV stands at `3,000/- each.
Ans: `1,28,000.

V. PROBLEMS ON SALES BOOK

39] From the following transactions prepare the sales book of Naveen Furniture
for the month of January 2023.
2023
Jan.04 Sold on credit to Raghu traders Hubli: 25 chairs of `500/- each
10 tables of `2,000/- each Trade discount @ 10%
Jan.09 Sold to Meghana traders: 2 tables of `1,500 each
4 bureaus of `8,000 each
Jan.16 Sold one old type writer to Janatha motors for `2,000.
Jan.23 Sold to Mr.Deepak one table for `1,500, and
4 chairs for `500 each at a trade discount of 2%.
Jan.27 Sold to Aravind Stores 10 chairs at `800 each.
Ans : `75,680.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 37 | P a g e

 40] Enter the following in the day book (sales book)
2023
Nov.01 Sold to Mr.Ravi for `6,000/- on credit
Nov.03 Mr. Keshav bought goods from us of `7,000/- on account.
Nov.09 Credit sales to Mr.Arun ` 10,000/-@ 2% discount.
Nov.12 Sold goods to Amul for `8,000 for cash.
Nov.24 Credit sales to Mr. Dhanu for `4,500/- and spent `200
for transportation.
Ans: ` 27,500.
41] Prepare the sales book for the month of February 2023 in the books of
Mahalakshmi traders.
2023
Feb.05 Sold 4 bags of wheat flour @ `500 each to Ashoka hotel
@ 5%trade discount.
Feb.12 Sold 2 boxes of spices at `800 per box to Amith on account and
also spent `200 for packing.
Feb.19 Vikas bought from us 5 kg coffee powder at `700 per kg
@ 8% trade discount.
Feb.20 Sold to Hema 5kg of sugar at `35 per kg. For cash.
Feb.28 Sold 4 bags of rice at `3,000 per bag to Rajesh.
Ans: `18,920.
42] Enter the following transactions in sales book.
2023
June 01 Sold goods to Aparna traders for `10,000/-@ 10% discount.
June 03 Sold goods to Rashmi traders of `7,000/- on credit.
June 11 Sold goods to Gagan and co. ` 8,000/- on credit.
June 20 Sold an old Motor car to Harsha on credit for `25,000.
June 25 Sold goods to Manu for `5,000/- at 5% trade discount.
Ans : `28,750.
43] Enter the following transactions in the sales book.
2023
Sept.01 Sold to Arun and co. 20 bags of rice @ `5,000/- per bag.
Sept.10 Mohan bought from us 10 bags of sugar of `3,000/- per bag
at 5% Trade discount.
Sept.15 Sold to Raju 2 bags of wheat at `2,000/ per bag for cash.
Sept.20 Sold to Bombay refreshments 5 bags of wheat flour at `700/
per bag at 10% discount.
Sept.25 Rahul bought from us 8 kg. Tea powder at `800/ per kg.
Ans : `1,36,550.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 38 | P a g e

 44] Prepare the sales book for the month of june 2016 in the books of Vidya book
stores:
2023
June 01 Sold 20 History books to Pooja book stores at `150 each
@10% trade discount.
June 06 Sold to Subhash book stores 15 dictionaries of `100 each.
June 10 Sold old furniture for `2,000/ for cash.
June 17 Sold 25 Accountancy text books for `100 each to
Saraswathy Book house.
June 26 Sold 10 English text books for `80 each to Samskruthi book
Stores at 3% discount.
Ans : `7,476.

45] Prepare the sales book from the following transactions:

2023
May 01 Sold 20 pen sets @ `150 per set to Samarth traders.
May 06 Sold 2 dozens of note books at `300 per dozen to
Sharadha book stores at 5% discount.
May 09 Sold to Guru publishers 15 roles of paper at `50 each.
May 17 Old motor car sold to Shiva motors for `80,000 on credit.
May 20 Sold to Nandish and co. 20 note books at `35 each; 15 note pads
at `10 each. Trade discount at 5%.
Ans: `5,127.

46] Enter the following transactions in the sales book of M/s Baldev Electronics:
2023
Nov.01 Sold to Nikhil traders as per bill no. 112, 10 radio sets at ₹500
each 20 earphone sets at `100 each, @ 10% trade discount.
Nov.08 Sold to Rahul traders as per bill no. 116:10 pen drives at `400
each 5 chargers at `120 each
Nov.13 Sold to Swathy Electronics as per bill no. 192 : 8 walkmans
at `500 each 5 tape recorders at `800 each
Nov.17 Sold to Mahadev : 10 TV sets at `10,000 each for cash.
Nov.18 Sold to Manya electronics ltd. As per bill no. 1340 :10 walkman
at `250 each 15 pocket radio at `200 each, at 10% trade discount.
Ans : `23,850.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 39 | P a g e

 47] Enter the following transactions in the books of Venkat stores:
2023
Dec.01 Sold to Anjali stores as per invoice no. 1314:
40 notebooks at `25 each
20 color pads at `50 each, trade discount at 10%
Dec.07 Sold to Girija stationeries as per invoice no. 1318:
20 staplers at `70 each
20 punching machines at `150 each
10 boxes of chalk pieces at `50 each Trade discount @ 5%.
Dec.12 Sold to Meghana stores as per invoice no.1413;
10 dozens of pens at `150 per dozen
20 dozens of pencils at `120 per dozen discount at 2%.
Dec.18 Sold to Gaurav Stores, 100 note books at `30 each for cash.
Ans : `10,199.

48] Record the following transactions in the sales book of Ganesh emporium,
Bangalore.
2023
April 01 Sold to Karnataka cloth center
10 shirts at `500 each
10 suits at `900 each at 20% trade discount.
April 06 Sold to Sagar cloth center
20 meter of woolen cloth at ` 50 per meter
10 blankets at `700 each,
April 12 Universal cloth center purchased from us
20 pants at `800 per pant
30 shirts at `700 per shirt, discount at 15%
April 20 Sold 10 blankets to Bhagya textiles at `300 per blanket for cash.
April 25 Sold 10 meters of cotton cloth to Anitha tailors
at `50 per meter on credit.
Ans : `53,550.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 40 | P a g e

 PART –D
Twelve Marks Problems:
PROBLEMS ON TWO COLUMN CASH BOOK
01] Record the following transactions of M/s tools India ltd. In two column cash
book:
Date Particulars `
2023
Jan.01 Bank balance 48,000
Cash balance 12,000
Jan.04 Purchased goods for cash 6,000
Jan.08 Bought goods by cheque 15,000
Jan.12 Sold goods for cash 11,000
Jan.15 Purchased machinery by cheque 7,500
Jan.16 Sold goods and received cheque and deposited in to the bank 8,500
Jan.18 Bought stationery by cheque 2,000
Jan.20 Cheque given to Rohith 3,500
Jan.21 Withdraw cash from bank for office purpose 10,000
Jan.27 Rent paid by cheque 3,000
Jan.31 Paid salary 4,000
Ans : cash balance `23,000. Bank balance `15,500.

02] Record the following transactions in two column cash book of Sagar and
balance it:
Date Particulars `
2023
Feb.01 Bank balance 50,000
Cash balance 10,000
Feb.02 Paid insurance premium by cheque 8,000
Feb.05 Cash sales 25,000
Feb.08 Cash purchases 18,000
Feb.10 Cash deposited in to the bank 19,000
Feb.12 Telephone bill paid by cheque 2,500
Feb.15 Withdrawn cash from the bank for personal use 5,000
Feb.16 Cash withdrawn from bank for office use 10,000
Feb.18 Received cheque from Anand for full settlement of his A/c of 10,500
`11,000 and deposited in to the bank
Feb.22 Cartage paid in cash 1,500
Feb.28 Cheque received from Kumar 5,000
Ans: Cash in hand `11,500; cash at bank `54,000.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 41 | P a g e

 03] Enter the following transactions in the double column cash book with bank
and Cash columns and balance it.
01. Cash at Office `18,500 and bank balance `79,850.
02. Mohan settled his account of `7,500, by giving the cheque of `7,300.
03. Mohan’s cheque deposited in to the bank
04. Mohan’s cheque returned dishonored
05. Paid for mobile bill `1,500
06. Purchased Furniture and paid by cheque `12,500
07. Bought goods and paid by cheque ` 20,000
08. Paid salary `6,000
09. Sold goods for cash `16,000
10. Insurance premium paid by cheque `2,500
11. Goods withdrawn for domestic use `3,500
12. Sold goods to Sindhu on credit `5,000.
13. cash deposited into the bank `15000.
Ans: cash in hand `12,000 cash at bank `59,850.

04] From the following transactions made by Ramanath traders, prepare Double
column cash book:
2023
Mar.01 Cash in hand `1,75,000 and at bank `6,500.
Mar.02 Deposited into the bank `1,05,000
Mar.03 Issued a Cheque for the furniture purchased `25,000
Mar.05 Purchased computer for `30,000
Mar.08 Loan taken from bank `3,00,000
Mar.09 Bought goods and paid by cheque `65,000
Mar.10 Bought computer for office use and paid by cheque `85,000.
Mar.11 Sold goods for `50,000 and received cheque from Govind
Mar.15 Purchased machinery from Hmt. Ltd. For `50,000 on credit
Mar.20 Settled Hmt’s account by transferring Govind’ cheque
Mar.23 Sold goods for cash to Sudhakar `24,000.
Mar.25 Stationery expenses paid `2,500.
Ans: cash in hand `61,500: cash at bank `2,36,500.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 42 | P a g e

 05] Record the following transactions in double column cash book and balance
it:
Date Particulars `
2023
April01 Cash balance 15,000
Bank balance 2,20,000
April02 Insurance premium paid by cheque 6,000
April04 Issued a cheque for goods purchased 28,000
April05 Sold goods and received cheque from Rahul 19,000
April08 Sold goods to Modi and get the amount transferred
to our bank account 36,000
April10 Paid rent by cheque 12,000
April11 Paid wages 3,500
April13 Bought goods from Amith 65,000
April15 Sold goods to mamatha and received a cheque 56,000
April20 Mamatha’s cheque deposited in to the bank
April28 Paid to Amith by cheque in full settlement of his account 64,000
Ans: cash in hand `25,500; cash at bank 2,02,000.

PROBLEMS ON SUBSIDIARY BOOKS

06] Enter the following transactions in the Purchases book, Purchases return
book,
Sales book, Sales return book:
2023
Jan 01 Goods sold to Sachin `5,000
Jan 04 Purchased from Kushal traders `2,480.
Jan 06 Sold goods to manish traders `2,100
Jan 07 Sachin returned goods `600
Jan 08 Rerurned to Kushal traders `280.
Jan 12 Purchased goods from Kunal traders `5,700 less 10% trade discount.
Jan 15 Sold to Sri chand brothers `6,600 less 5% trade discount.
Jan 20 Return outwards to Kunal traders `1,000 less 10% trade discount.
Jan 24 Bought of Naresh `4,060.
Jan 26 Furniture purchased from Tharun `3,200.
Jan 29 Chand brothers returned goods `500.
Jan 30 Sold to Mukesh `3,300.
Jan 31 Mukesh returned goods `300.
Ans: P.book `11,670; S.book `16670; P.R.book `1,180; S.R.book `1,400.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 43 | P a g e

 07] Enter the following transactions in the Purchases book, Purchases return
book,
Sales book, Sales return book of Mr. Kumar:
2023
Dec.01 Purchased goods from Prem for `20,000 less 5% trade discount.
Dec.03 Purchased goods from Sunil for `15,000 for cash.
Dec.05 Sold goods to Suresh for `12,000.
Dec.08 Sold goods to Karan `35,000 less discount 10%.
Dec.10 Purchased goods from Mohan for `15,000 less trade discount 10%.
Dec.13. Sold goods to Sundar for `30,000.
Dec.17 Goods returned by Sundar worth `5,000.
Dec.20 Goods returned to Prem `5,000.
Dec.22 Sold old newspapers to Thamos `200.
Dec.25 Purchased goods from Naveen for `20,000.
Dec.28 Returned goods worth `3,000 to Mohan.
Dec.30 Bought goods from Ajay `6,500.
Dec.31 Allowances claimed from Ajay for shortage `50.
Dec.31 Sold goods to Bimal `2,000.
Ans: P.book `74,000;S.book `75,500;P.R.book `8,000;S.R.book `5,050.

08] Enter the following transactions in the Purchases book, Purchases return
book,
Sales book, Sales return book:
2023
April 01 Goods sold to Manish `6,000.
April 02 Purchased goods from Ramesh `16,000.
April 03 Bought goods from Rahul `18,000 less trade discount 10%.
April 06 Goods returned to Ramesh `1,500.
April 08 Goods sold to Kushal `10,000 less discount 10%.
April 10 Goods purchased from Sheethal traders `7,000.
April 13 Returned goods from kushal `1,000.
April 15 Sold goods to Hari `6,000 less trade discount @ 5%.
April 18 Goods purchased from Naresh `5,000.
April 20 Goods returned from Hari `300.
April 22 Old machinery sold to Ramesh on credit `12,000.
April 24 Raju purchased goods from us `8,000.
April 28 Manish claimed for shortage of `500.
Ans: P.book `44,200; S.book `28,700; P.R.book `1,500;S.R.book `1,800.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 44 | P a g e

 09] Enter the following transactions in the Purchases book, Purchases return
book, Sales book, Sales return book:
2023
Aug. 01 Purchased goods from Sharath `3,500.
Aug. 02 Bought from Kiran `4,500 on account, less 10% trade discount.
Aug. 04 Sold goods to Aswin `4,500.
Aug. 06 Returned defective to Kiran `1,000 (gross).
Aug. 07 Sold goods to Sundar `4,000.
Aug. 10 Credit sales to Raju and sons `15,000.
Aug. 12 Returned defective goods from Sundar `1,000.
Aug. 15 Credit purchases from Anand `10,000.
Aug. 18 Dinesh bought goods from us on account `5,000.
Aug. 19 Cash sales to vinay `3,000.
Aug. 24 Sent a credit note to Dinesh `1,000.
Aug. 25 Bought 15 units from Jayanth at `200 per unit.
Aug. 31 Returned to Jayanth 2 damaged units.
Ans:P.book `20,550;S.book `28,500;P.R.book `1,300;S.R.book `2,000.

10] Record the following transactions in the Purchases book, Purchases return
book, Sales book, Sales return book of Unique provisional stores for the
month of June 2023.
June 01 Purchased 10 bags of rice from fine rice mills, Maddur @ `5,500
per bag.
June 02 Sold 2 bags of sugar to Ashoka hotel, Bengaluru @ `3,500 per bag.
June 05 Sent a debit note to Fine rice mills, Maddur for the over price of
`300 per bag.
June 07 Sold 20 kg of coffee powder to Janapriya hotel at `120 per kg.
June 10 Purchased 25 cases of tea powder from Tata tea suppliers for
` 6,250.
June 12 Sent a credit note by Janapriya hotel for short supply of 2 kg.
Coffee powder.
June 15 Returned 4 cases of defective tea powder to Tata tea suppliers.
June 18 Bought 15 bags of wheat flour from Panjab flour mills @ `2,000
Per bag.
June 21 Supplied two bags of rice and 3 bags of wheat flour to Reliance
stores @ `3,400 per bag and `2,600 per bag respectively.
June 23 Reliance stores returned wrong supply of one bag of rice.
June 26 Bought office furniture from Vishal furniture mart for `25,000
on credit.
June 27 Sold to Vishnu Darshini provisions of `10,000 on account, less
10% discount.
Ans : P.book `91,250; S.book `33,000;P.R.book `4,000;S.R.book `3,640.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 45 | P a g e

 11] Enter the following transactions of M/s Highlight fashions in purchases and
purchases returns book and post them to the ledger accounts for the month
of September 2023.
Date Details
2023
Sept.01 Purchase of the following goods on credit from M/s Rakesh traders
as per invoice no. 417:
50 shirts at `600 per shirt
20 pants at `700 per pant, less 10% trade discount.
Sept.08 Purchase of following goods on credit from Bombay fashion house as
per invoice no. 723:
10 fancy trousers at `1,000 per trouser
20 fancy hats at `100 per hat, less 5% trade discount.
Sept.10 Goods returned to Rakesh traders as per debit note no. 201:
3 shirts at `600 per shirt
1 pant at `700 per pant, less 10% trade discount.
Sept.15 Purchase of following goods on credit from M/s Royal fashions as per
invoice no. 1876:
20 jackets at `1,000 per jacket
10 plain shirts at `400 per shirt, less 15% trade discount.
Sept.20 Purchase of following goods on credit from M/s Brigade palace as per
invoice no. 6701:
25 fancy lengha @ `2,000 per lengha, less 5% trade discount.
Sept.24 Goods returned to Bombay fashion house as per debit note no.103:
02 fancy trousers @ `1,000 per trouser
04 fancy hats @ `100 per hat, less 5% trade discount.
Sept.28 Goods returned to M/s Brigade palace as per debit note no. 501:
02 fancy Lengha @ `2,000 per lengha
Less 5% trade discount.
Ans; P.book 1,18,900;P.R.book 8,330.

12] Enter the following transactions in the sales and sales returns book of
M/s Navaneeth stores:
Date Particulars
2023
Dec.01 Sold goods on credit to M/s Rajani stores as per bill no. 523:
60 kids books at `120 each
40 Animal books @ `100 each
Dec.05 Sold goods to M/s Meena stores as per invoice no.238:
200 greeting cards at `12 each
50 musical cards at `50 each, less 5% trade discount.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 46 | P a g e

 Dec.10 Sold goods on credit to M/s Noble stationeries as per invoice no.329:
100 writing pads at `40 each
100 colour books at `60 each
40 ink pads at `32 each
Dec.15 Goods returned from M/s Rajani stores as per credit note no.102:
04 kids books at `120 each
02 Animal books at `100 each
Dec.19 Sold goods on credit to M/s Abhi traders as per invoice no. 553:
500 rules note books at `20 each
250 plain note books at `25 each, less 5% trade discount.
Dec.22 Goods returned from M/s Noble stationeries as per credit note
no.204:
04 colour books @ `60 each
Dec.30 Goods returned from Abhi traders as per credit note no. 207:
20 ruled note books at `20 each
05 plain note books at ` 25 each, less 5% trade discount.

Ans: Sales.book 41,385; S.R.book 1,155l

13] Enter the following transactions in Purchase and Sales day book and prepare
only personal accounts in the ledger: (for practice purposes only)
2023
Mar.01 Purchased 50 Accountancy text books from Nuthan publishers at
` 100 per copy.

Mar.07 Sold to Bhaskar 10 accountancy text books at `110 per copy.

Mar.12 purchased 150 Business studies text books from Himalaya
publishers @ `100 each, Less discount @ 25%.
Mar.15 Sold to Mr. Dinesh stores 50 business studies text books at `100
each less 10% trade discount.
Mar.20 Bought 200 Economics note books from Abhiman publishers
at `80 each less 30% trade discount.
Mar. 26 Sold to MK book house, 100 economics text books at `75 each.
Ans: P.book 27,450;S.book 13,150.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 47 | P a g e

 Key answer for short questions :
MCQ
1] d 2] b 3] c 4] c 5] a 6] b 7] a 8] b 9] d 10] a 11] d 12] d
13] a 14] c 15] a

TRUE OR FALSE
11] t 12] t 13] f 14] t 15] f

FILL IN THE BLANKS

1] special 2] journal proper 3] credit 4] asset 5] ledger
6] petty cash book 7] analytical or columnar petty cash 8] cash
9] cash and Bank 10] sales returns book 11] purchase returns book
12] purchases 13] sales 14] Cash book
15] journal proper.

MATCH THE FOLLOWING

a] vi b] iv c] i d] ii e] iii

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 48 | P a g e

 CHAPTER - 05

BANK RECONCILIATION STATEMENT

PART - A
One Mark Questions:
I. Multiple Choice Questions:
1] A bank reconciliation statement is prepared by:
a] Creditors
b] bank
c] Account holder in a bank
d] Debtors
2] A bank reconciliation statement is prepared with the balance:
a] Passbook
b] Cashbook
c] Both passbook and cashbook
d] Purchase book
3] Passbook is a copy of
a] Customer Account
b] Bank column of cash book
c] Cash column of cash book
d] Receipts and Payments
4] Unfavourable bank balance means
a] Credit balance in pass book
b] Credit balance in cash book
c] Debit balance in cash book
d] Both (a) and (b)
5] Favourable bank balance means
a] Credit balance in the cash book
b] Credit balance in the pass book
c] Debit balance in the pass book
d] Both (a) and (b)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 49 | P a g e

 6] A bank reconciliation statement is mainly prepared for
a] Reconcile the cash balance of the cash book
b] Reconcile the difference between the bank balance shown by the
cash book and passbook
c] Both (a) and (b)
d] Reconcile the bank balance of the passbook
7] Cheque issued but not presented for payment is also known as
a] Uncollected cheques
b] Uncredited cheques
c] Outstanding cheques
d] Cheques deposited by customers
8] Bank reconciliation statement compares a bank statement with…..
a] Cash payments journal
b] Cash receipts
c] Financial statements
d] Cash book
9] ABC Ltd., receives a cheque for `100, records it in the cash book, and deposits
it on the same day. A statement sent by the bank that day does not show this
`100. How is this shown on the bank reconciliation statement?
a] As an uncredited deposits added to the bank statement balance
b] As an uncredited deposits deducted from the bank statement balance.
c] As an unpresented cheque added to bank statement balance.
d] As an unpresented cheque deducted from the bank statement balance.
10] Bank overdraft as per cash book is a___
a] Debit balance
b] Credit balance
c] Cash balance
d] Favourable balance

II. Fill in the blanks:

1] Passbook is a copy of ________as it appears in the ledger of the bank.
2] When money is withdrawn from the bank, the bank __________the account of
the customer.
3] Normally, the cash book shows a debit balance, passbook shows
_______balance.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 50 | P a g e

 4] Favourable balance as per the cashbook means _______ balance in the bank
column of the cash book.
5] If the cash book balance is taken as starting point the items which make the
cash book balance smaller than the passbook must be _____ for the purpose
of reconciliation.
6] If the passbook shows a favourable balance and if it is taken as the starting
point for the purpose of bank reconciliation statement, then cheques issued
but not presented for payment should be _____ to find out cash balance.
7] When the cheques are not presented for payment, favourable balance as per
the cash book is _______ than that of the passbook.
8] When a banker collet the bills and credits the account passbook overdraft
shows _____ balance.
9] If the overdraft as per the passbook is taken as the starting point, the cheques
issued but not presented are to be _____ in the bank reconciliation statement.
10] When the passbook balance is taken as the starting point items which makes
the passbook balance _______ then the balance in the cash book must be
deducted for the purpose of reconciliation.

III. Match the following:

A B
a] Passbook (i) withdrawal exceeds deposits
b] Dividend collected by the bank (ii) deposits held at the bank.
c] Favourable balance as per cash book (iii) copy of customer account
d] Overdraft (iv) debit balance in cash book
e] Favourable balance as per pass book (v) reason for difference between the
cashbook and pass book
(vi) over casting in Dr. side of cash book

IV. VERY SHORT ANSWER QUESTIONS:

1] What is passbook?
2] What is bank overdraft?
3] Give an example for errors committed by the firm in cash book.
4] State any one causes of difference between cash book balance and pass book
balance occurred due to Time difference.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 51 | P a g e

 5] Expand BOD.
6] Cheques issued but not presented for payment will reduce the balance as per
the passbook. (State true/false)
7] Cheques deposited but not collected will result in increasing the balance of
cash book when compared to passbook. (State true/false)
8] Overdraft as per the passbook is less than the overdraft as per the cashbook
when there are cheques deposited but not collected by the banker. (State
true/false)
9] The bank credits the customer accounts only when the amount of cheques are
actually realized (State true/false)
10] When payments made by the bank as per the standing instruction of the
customer the balance in the passbook will be more when compare to the cash.
(State true/false)

PART - B
TWO MARKS QUESTIONS:
1] What is Bank Reconciliation Statement?
2] Why is Bank Reconciliation Statement prepared?
3] State any two causes for the difference between cash book balance and pass
book balance.
4] Give any two examples for errors committed by the firm in cash book.
5] Give any two examples for errors committed by the bank in pass book.
6] What do you understand by the following?
a] Debit balance as per cash book. b] Credit balance as per cash book.
7] What do you understand by the following?
a] Debit balance as per pass book. b] Credit balance as per pass book
8] What do you understand by the following?
a] Favourable balance as per cash book
b] Unfavourable balance as per cash book
9] What do you understand by the following?
a] Favourable balance as per pass book
b] Unfavourable balance as per pass book
10] State any two factors which is caused by the time gap in recording the
transactions.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 52 | P a g e

 PART - C
Twelve marks problems:
Dealing with favourable balances:
1] From the following particulars of Mr. Shourya, prepare Bank Reconciliation
Statement as on March 31, 2024.
a] Bank balance as per cash book `50,000.
b] Cheques issued, but not presented for payment `6,000.
c] Dividend on shares collected by the bank and credited in the pass book
`8,000.
d] Bank charges debited in the pass book only `400.
e] A cheque deposited into bank, but not collected by the bank `5,000.
f] Interest credited in the pass book only `500.
g] Insurance premium paid directly by the bank understanding advice
`1,000.
(Ans: Balance as per pass book `58,100)

2] From the following particulars of Mr. Chidananda, prepare Bank

Reconciliation Statement as on Dec. 31, 2023.
a] Bank balance as per cash book `20,000.
b] Cheques issued, but not cashed prior to Dec. 31, 2023 `4,000.
c] Interest on investments collected by the bank and credited in the pass
book `2,000.
d] Bank charges debited in the pass book only `100.
e] Cheques paid into bank, but not cleared before Dec.31,2023 `3,000.
f] Interest credited in the pass book only `400.
g] Electricity bill paid by the bank unde standing order `300.
(Ans: Balance as per pass book `23,000)

3] From the following particulars of Mrs. Gowri kumar, prepare Bank

Reconciliation Statement as on June.30, 2023.
a] Bank balance as per cash book `80,000.
b] Out of cheques issued for `10,000, cheques for `2,000 cashed before
Jun. 30, 2023.
c] There was a wrong credit in the pass book for `5,000.
d] Bank charges debited in the pass book only `300.
e] Out of Cheques amounting to `8,000 deposited into bank, `3,000 only
collected before Jun.30, 2023.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 53 | P a g e

 f] Payment received from a customer directly by the bank `1,000
g] Bills discounted dishonoured `4,000.
(Ans: Balance as per pass book `84,700)

4] Prepare a Bank Reconciliation Statement as on May 31,2024.

a] The bank pass book of Mrs. Lakshmi showed a balance of `10,000 on
May 31, 2024.
b] Cheques issued, but not presented for payment `12,000.
c] The payments side of the cash book (bank column) was overcast by
`1000
d] Bank commission debited in the pass book only `100.
e] Cheques of `4,000 deposited into bank, of which `3,000 only collected
in May.
f] Interest on bank balance credited in the pass book only `200.
g] Club bill paid by the bank under Standing order `900.
(Ans: Overdraft as per Cash book `1200 )

5] Prepare a Bank Reconciliation Statement as on Jan.31,2024.

a] The bank passbook of Mr. Sanjay showed a balance of `55,000
on Jan.31, 2024.
b] Cheques issued before Jan. 31, 2024, but not presented for encashment
until that date `9,000
c] Two cheques of `3,900 and `2,100 were deposited into the bank on
Jan. 31,2024 but the bank gave credit for the same in Feb.2024
d] There was also a debit in the pass book of `2,500 in respect of a cheque
dishonoured on Jan. 31, 2024.
e] A bill receivable for `1,000 discounted with the bank was dishonoured.
f] Direct deposit into bank by a customer omitted in cash book `3,500
g] The debit side of the cash book (bank column) undercast by `1,000.
(Ans: Balance as per cash book `51,000)

6] From the following particulars, prepare a Bank Reconciliation Statement of

Mr. Vijay as on 30th April, 2024 and ascertain bank balance as it would
appear in cash book:
a] Bank pass book showed a balance of `25,000 on 30th April.
b] Bank charges of `250 has been debited in the pass book, but not entered
in the cash book.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 54 | P a g e

 c] There was a wrong debit in the pass book for `1,000.
d] Cheques issued, but not encashed prior to 30th April, amounted to
`1,500.
e] Cheques sent to bank for collection, but remained uncollected `2,500.
f] Interest on investments collected by the bank and credited in the pass
book `1,800.
g] Payment by a cheque `1,900 entered in cash book (bank column) as
`2,900.
(Ans: Balance as per cash book `24,450)

7] From the following particulars of Mr.Shreyas, prepare Bank Reconciliation

Statement as on Dec. 31, 2023.
a] Bank balance as per cash book `75,000.
b] Cheques issued, but not cashed prior to Dec. 31, 2023 `8,000.
c] Interest on investments collected by the bank and credited in the
pass book `6000.
d] Bank charges debited in the pass book only `500.
e] Cheques paid into bank, but not cleared before Dec.31,2023 `7,000.
f] Interest credited in the pass book only `1,000.
g] Electricity bill paid by the bank under standing order `800.
(Ans : Balance as per pass book `81,700)

8] From the following particulars of Mrs Padmavthi, prepare Bank

Reconciliation Statement as on Jan.31, 2024.
a] Bank balance as per cash book `40,000.
b] Out of cheques issued for `10,000, cheques for `6,000 cashed before
Jan. 31, 2024
c] There was a wrong credit in the pass book for `2,000.
d] Bank charges debited in the pass book only `400.
e] Out of Cheques amounting to `8,000 deposited into bank, `5,000 only
collected before Jan.31, 2024.
f] Payment received from a customer directly by the bank `2,000
g] Bills discounted dishonoured `5,000.
(Ans : Balance as per pass book `39,600)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 55 | P a g e

 9] From the following particulars, prepare Bank Reconciliation Statement as on
31st Mar. 2024:
a] Bank balance as per pass book `40,000.
b] Cheques issued, but not presented for payment `7,000.
c] Cheques paid into bank, but not collected by the bank `6,000.
d] Interest on investments amounting to `1,500 appeared only in the
pass book.
e] Direct deposit into the bank by a customer `2,000
f] Interest on bank deposits `4,300 credited in the pass book only.
g] Bank charges `300 debited in the pass book only.
(Ans: Balance as per cash book `31,500)

10] The cash book shows a bank balance of `7,800. On comparing the cash book
with passbook the following discrepancies were noted. Prepare Bank
Reconciliation Statement:
a] Cheque desposited into bank, but not credited `13,000
b] Cheque issued, but not yet presented for payment `1,500
c] Insurance premium paid by the bank `2,000
d] Bank interest credited by the bank `400
e] Bank charges `100 debited in the pass book.
f] Directly deposited by a customer `4,000
(Ans : Overdraft as per pass book `1400)

11] From the following particulars, prepare Bank Reconciliation Statement as on

31st Mar. 2024:
a] Bank balance as per pass book `30,000
b] Cheques issued, but not presented for payment `5,000.
c] Cheques deposited into bank, but not collected `4,000.
d] Dividend on shares collected by the bank and credited in the
pass book only ` 4,000.
e] Electricity bill is paid by the banker and debited in the pass book only
`1,000
f] Interest on bank deposits `2,500 and Bank charges `500 are recorded
in the pass book only.
(Ans: Balance as per cash book `24,000)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 56 | P a g e

 12] The bank pass book of Mr. Navarathna kumar showed a balance of `18,000 on
Jan.31, 2024.
a] Cheques issued before Jan. 31, 2024, but not presented for encashment
until that date `2,000
b] Two cheques of `1,600 and `1,400 were deposited into the bank on
Jan. 31,2024, but the bank gave credit for the same in Feb.2024
c] There was also a debit in the passbook of `1,500 in respect of a cheque
dishonoured on Jan. 31, 2024.
d] A bill receivable for `1,000 discounted with the bank was dishonoured.
e] Direct deposit into bank by a customer omitted in cash book `1,300
f] The credit side of the cash book (bank column) overcast by `200.
Prepare a Bank Reconciliation Statement as on Jan.31,2024.
(Ans: Balance as per cash book `20,000)

Dealing with overdraft (Unfavourable balance)

13] Overdraft shown by the pass book of Mr. Sheshank is `20,000. Prepare Bank
Reconciliation Statement as on July. 31, 2024.
a] Bank charges debited as per pass book `500.
b] Cheques received recorded in the cash book (bank column), but not sent
to the bank for collection `2,500.
c] Received a payment by bank directly from a customer `4, 600.
d] Cheque issued, but not presented for payment `6, 980.
e] Interest on overdraft debited by the bank `100.
f] Insurance premium paid by bank `2, 500.
g] Cheques deposited into the bank, but not collected `3, 500.
(Ans: Overdraft as per cash book `22,480)

14] On 31-03-2024 the pass book of Mr. Mohan showed a bank overdraft of
`12,000. From the following particulars, prepare a Bank Reconciliation
Statement as on 31-03-2024.
a] Out of total cheques amounting to `6,000 issued on 10-03-2024,
cheques of `4,000 only were cashed so far.
b] Cheques paid into bank, but not cleared before 31-03-2024 amounted to
`3,000.
c] There was a wrong debit of `2,000 given in the pass book
d] One of the customers directly deposited `1,000 into bank for which there
was no entry in the cash book.
e] Dividend on shares collected by the bank and credited in the pass book
amounted to `1,500.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 57 | P a g e

 f] There was a debit of `500 in the pass book in respect of dishonoured
cheque, but there was no corresponding entry in the cash book.
(Ans: Overdraft as per cash book `11,000)

15] From the following particulars of Mr.Gopi, prepare Bank Reconciliation

Statement as on July 31, 2023.
a] Bank overdraft as per cash book `10,000.
b] Cheques issued, but not presented for payment `13,000.
c] Dividend on shares collected by the bank and credited in the pass book
`2,000.
d] Interest on overdraft debited in the pass book only `500.
e] A cheques deposited into bank, but not collected by the bank `5,000.
f] Direct deposit into bank by a customer `4,000 for which no entry was
made in cash book
g] Insurance premium paid directly by the bank understanding order
`1,500.
(Ans: Bank balance as per pass book `2000)

16] From the following particulars of Mr.Tejas, prepare Bank Reconciliation

statement as on Aug. 31, 2023.
a] Bank overdraft as per cash book `20,000.
b] Cheques issued, but not cashed prior to Aug. 31, 2023 ` 6,000.
c] Interest on investments collected by the bank and credited in the
pass book `3,000.
d] Bank charges debited in the pass book only `100.
e] Cheques paid into bank, but not cleared before Aug.31,2023 `2,000.
f] Credit side of the cash book (bank column) overcast by `600.
g] Bills discounted dishonoured `1,000
(Ans: Overdraft as per pass book `13,500)

17] From the following particulars of Asha & Co, prepare a Bank Reconciliation
Statement on Oct. 31, 2023:
`
Overdraft as per pass book 20,000
Interest on overdraft debited in passbook only 2,000
Insurance Premium paid by the bank 200

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 58 | P a g e

 Cheques issued, but not presented for payment 6,500
Cheques deposited, but not yet cleared 6,000
Wrongly debited by the bank 500
The receipt side of the cash book (bank column) was under-cast by 100
(Ans: Overdraft as per cash book `17,900)

18] On 31-03-2024 the pass book of Mr. Swamy showed a bank overdraft of
`6,000. From the following particulars, prepare a Bank Reconciliation
Statement as on 31-03-2024.
a] Out of total cheques amounting to `3,800 issued on 28-03-2024, cheques
of `2,000 only were cashed so far.
b] Cheques paid into bank but not cleared before 31-03-2024 amounted to
`1,000.
c] There was a wrong debit of `100 given in the pass book
d] One of the customers directly deposited `300 into bank for which there
was no entry in the cash book.
e] Dividend on shares collected by the bank and credited in the pass book
amounted to `200.
f] There was a debit of `500 in the pass book in respect of dishonoured
cheque, but there was no corresponding entry in the cash book.
(Ans: Overdraft as per cash book `6700)

19] Prepare Bank Reconciliation Statement from the following particulars.

a] Overdraft shown as per cash book on September 30, 2024 `10,000.
b] Bank charges debited in the passbook `100
c] Interest on overdraft for six months ending September 30, 2024 `380
debited in the passbook.
d] Cheques issued, but not encashed prior to September 30, 2024
amounted to `2,150.
e] Interest on investment collected by the bank and credited in the
passbook `600.
f] Cheques paid into bank, but not cleared before Septermber 30th 2024
were `1,100.
g] There was a wrong credit in the pass book for `830
Ans : overdraft as per pass book ` 8,000).

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 59 | P a g e

 20] On December 31, 2023 the cash book of Mr.Puneeth showed an overdraft of
`6,920. From the following particulars prepare a Bank Reconciliation
Statement and ascertain the balance as per pass book.
a] Debited by bank for `200 on account of interest on overdraft and `50 on
account of charges for collecting bills.
b] Cheques drawn, but not enchased before Dec. 31, 2023 for `4,000.
c] The bank has collected interest and has credited `600 in passbook.
d] A bill receivable for `700 previously discounted with the bank had been
dishonoured and debited in the passbook.
e] Cheques paid into bank, but not collected and credited before Dec. 31,
2023 amounted `6,000.
f] The debit side of the cash book (bank column) was under cast by `270.
(Ans: Overdraft as per Pass book `9,000)

21] Prepare a bank reconciliation statement.

a] Overdraft shown as per cash book as on March 31,2023 `10,000
b] Bank charges debited in Pass book `100
c] Interest on overdraft debited in passbook `380
d] Interest on investment collected by the bank `600
e] Cheques issued but not cashed before 31.03.2023 `2150
f] Cheques paid into bank but not cleared before 31.03.2023 `1,100
g] Direct deposit into bank by a customer `11,000
(Ans: Bank balance as per Pass book `2,170)

Key answer for short questions :

MCQ
1] c 2] c 3] a 4] b 5] b 6] b 7] c 8] d 9] a 10] b

FILL IN THE BLANKS

1] Customer Account 2] Debit 3] Credit 4] Debit 5] Added
6] Deducted 7] Less 8] Less 9] Added 10] Higher.

MATCH THE FOLLOWING

a] iii b] v c] iv d] i e] iv

TRUE OR FALSE
6] False 7] True 8] False 9] True 10] False

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 60 | P a g e

 CHAPTER - 06

TRIAL BALANCE AND

RECTIFICATION OF ERRORS

PART - A
One Mark Questions:
I. Multiple Choice Questions:
1] Agreement of trial balance is affected by:
a] One sided errors only
b] Two sided errors only.
c] Both a and b
d] None of the above.
2] Which of the following is not an error of principle?
a] Purchase of furniture debited to purchases account.
b] Repairs on the overhauling of second hand machinery purchased
debited to repairs account.
c] Cash received from Manoj posted to Saroj.
d] Sale of old car credited to sales account.
3] Which of the following is not an error of commission:
a] Over casting of sales book.
b] Credit sales to Ramesh `5000 credited to his account.
c] Wrong balancing of machinery account.
d] Cash sales not recorded in cash book
4] Which of the following errors will be rectified through suspense account:
a] Sales return book was under cast by `1,000.
b] Sales return by Madhu `1,000 not recorded.
c] Sales return by Madhu `1,000 recorded as `100.
d] Sales return by Madhu `1,000 recorded through purchases
returns book.
5] If the trial balance agrees generally, it implies that:
a] The posting of the ledger is arithmetically correct.
b] There may be two sided errors in the books.
c] There may be one sided errors in the books.
d] There may be both two sided and one sided errors in the books.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 61 | P a g e

 6] If the suspense account does not balance even after rectification of errors, it
implies that :
a] There are some one sided errors only in the books yet to be located.
b] There are no more errors yet to be located.
c] There are some two sided errors only yet to be located.
d] There mus be both one sided errors and two sided errors yet to
be located.
7] If wages paid for installation of new machinery is debited to wages account,
it is:
a] An error of commission.
b] An error of principle.
c] A compensating error.
d] An error of omission
8] Trial balance is:
a] An account.
b] A statement.
c] A subsidiary book.
d] A principal book.
9] A trial balance is prepared:
a] After preparation of financial statements.
b] After recording transactions in subsidiary books.
c] After posting to the ledger is completed.
d] After posting to ledger is completed and accounts have been balanced.
10] Objective of preparing trial balance is:
a] To know the accuracy of account.
b] To know the financial position of the business.
c] To know the profit or loss.
d] To know the arithmetical accuracy of books of accounts.

II Fill in the blanks:-

1] The Trial balance is usually prepared with the ______________of accounts.
2] Trial balance is normally prepared at the ____________of the accounting year.
3] Trial balance is a list of ______________and its balances.
4] When a transaction is completely omitted from recording in the books of
original records, it is an error of ______________________.
5] Accounting entries are not recorded as per the generally accepted accounting
principles is known as error of ______________________.
6] When two or more errors are committed in such a way that the net effect of
these errors on the debit and credit of account is nil, such errors are called
__________________ errors.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 62 | P a g e

 7] Capital account balance is a ___________ balance.
8] Drawings account balance is a__________ balance.
9] Assets account balances are _________balances.
10] Liabilities account balances are ________balances.
11] Expenses account balances are ________balances.
12] Incomes account balances are _________balances.

III. Match the following:

A B
a Trial balance i Error of commission
b Objectives of Trial balance ii Error of ommission
c Capital account iii Error of principle
d Drawings account iv Statement
e Overcasting v Debit balance
f Transaction omitted to record in vi Compensating errors
books
g Entries not recorded as per GAAPs vii Locating errors
h Errors do not affect the arrangement viii Suspense account
of trial balance
i Difference in Trial balance ix Credit balance

IV. Very Short Answer Questions: -

1] What is Trial balance?
2] State one objective of Trial Balance.
3] Name one method of preparing the Trial Balance.
4] State any one classification of error.
5] Give an example for error of commission.
6] Give an example for error of omission.
7] Give an example for error of principle.
8] Give an example for compensating errors.
9] Give an example for error which affects the trial balance.
10] Give an example for error which does not affects the trial balance.
11] When a suspense account is opened?

State true or false in the following cases:

12] Trial Balance is a statement of ledger account balances on a particular date.
13] Trial balance is a part of book-keeping.
14] Trial balance is just a statement and not an account.
15] Object of preparing the trial balance is to know profit or loss of the business.
16] The difference of trial balance is transferred to capital account.
17] Generally trial balance does not include the closing stock.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 63 | P a g e

 18] When one error compensates the other mistakes it is called error of principle.
19] Error of omission affects the agreement of Trial balance.
20] Compensating error does not affect the totals of Trial balance.
21] Trial Balance cannot trace the error of principle.
22] Preparation of trial balance is compulsory.

PART - C
Six marks Questions/Short problems
Preparation of Trial Balance:
1] Prepare a trial balance from the following balances as on 31-03-2024:
Capital `25,000
Bills Payable `1,850
Bills Receivable `4,400
Stock on1.4.2023 `8,500
Furniture `2,600
Purchases `8,950
Sales `22,500
Discount earned `970
Carriage `300
Cash at Bank `25,570
(Ans. Total `50,320)

2] Mr. Ganesh’s ledger shows the following balances, prepare a Trial balance
using balances method.
Sl.No. NAME OF ACCOUNTS Balance (`)
1 Ganesh’s capital account 50,000
2 Manu’s Account (credit) 40,000
3 Machinery Account 17000
4 Ravi’s Account (Debit) 15,000
5 Sales Account 60,000
6 Wages Account 5,000
7 Purchases Account 76,000
8 Cash Account 41,000
9 Debtors 10,500
10 Creditors 14,500
(Ans: Total `1,64,500)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 64 | P a g e

 3] From the following particulars given below prepare a Trial Balance as on
31-03-2024
Sl.NO Particulars Balance (`)
1 Purchases 95,000
2 Sales 1,36,000
3 Bank loan 20,000
4 Machinery 50,000
5 Cash 46,000
6 Capital 1,00,000
7 Debtors 80,000
8 Creditors 17,000
9 Bills receivable 4,000
10 Bills payable 2,000

(Ans: Total ` 2,75,000)

4] Prepare a Trial balance from the following balances relating to Mrs. Sridevi as on
31-03-2024:
Sl. No Particulars Balance (`)
1 Mrs. Sridevi ’s Capital 1,45,000
2 Stock of goods 70,000
3 Motor car 1,20,000
4 Bad debts 7,000
5 Sales 2,00,000
6 Cash at bank 90,000
7 Cash in hand 12,000
8 Rent 35,000
9 Discount earned 4,000
10 Carriage 15,000
(Ans: Total `3,49,000)

5] Prepare a trial balance from the following ledger balances extracted from the
books of Mr. Harsha Traders, Tumakuru as on 31-03-2024.

Sl. No Particulars Balance (`)

1 Opening stock 18,000
2 Capital 4,72,000
3 Buildings 46,000
4 Plant 33,860
5 Carriage 2,000
6 Sales 3,60,000

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 65 | P a g e

 7 Purchases 3,08,600
8 Sales returns 3,640
9 Machinery 4,21,880
10 Interest received 1,980

(Ans: Total `8,33,980)

6] From the following ledger balances of Mrs. Arpitha, prepare Trial balance as
on 31-03-2024

Sl. No Particulars Balance (`)

1 Stock (01-04-2023) 15,000
2 Purchases 30,000
3 Sales 40,000
4 Capital 45,000
5 Drawings 10,000
6 Debtors 18,000
7 Creditors 10,000
8 Investments 15,000
9 Legal Charges 2,000
10 Cash in hand 5,000

(Ans: Total `95,000)

7] From the following particulars of Mr. Arjun, prepare Trial balance as on

31-03-2024:

Sl. No. Particulars Balance(`)

1 Capital 2,33,000
2 Stock of goods 60,000
3 Motor Car 89,000
4 Discount earned 4,000
5 Sales 4,00,000
6 Cash at Bank 46,000
7 Rent paid 40,000
8 Wages 97,000
9 Purchases 3,50,000
10 Trade Creditors 45,000

(Ans: Total ` 6,82,000)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 66 | P a g e

 8] From the following particulars of Mr.Mallik, prepare Trial balance
as on 31-03-2024:

Sl.No. Particulars Balance (`)

1 Mallik’s Capital 4,00,000
2 Mallik’s Drawings 20,000
3 Land and Biulding 3,79,500
4 Stock on 01-04-2023 1,25,000
5 Sundry Debtors 22,000
6 Sundry Creditors 27,500
7 Purchases 2,37,000
8 Sales 3,84,000
9 Carriage inwards 2,000
10 Postage and Telephone 26,000

(Ans: Total `8,11,500)

9] From the following particulars of Mr.Amith, prepare Trial balance

as on 31-03-2024

Sl.No. Particulars Balance(`)

1 Opening stock 24,520
2 Capital 4,72,000
3 Buildings 81,440
4 Sales 3,60,000
5 Purchases 3,64,600
6 Sales return 3,640
7 Machinery 3,72,300
8 Discount allowed 15,800
9 Loan from Manu 16,000
10 Bank overdraft 14,300
(Ans: Total `8,62,300)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 67 | P a g e

 10] From the following particulars of Mr.Purushotham, prepare Trial balance
as on 31-03-2024

Sl.No. Particulars Balance(`)

1 Mr.Purushotham’s Capital 15,16,000
2 Debtors 1,00,000
3 Purchases 5,00,000
4 Sales 6,00,000
5 Return inwards 4,000
6 Land and Buildings 12,60,000
7 Loan to employees 1,00,000
8 Interest received 18,000
9 Opening stock 1,20,000
10 Goodwill 50,000
(Ans: Total `21,34,000)

PART - C
6 Marks problems on Rectification of Errors:

1] Rectify the following errors:

a] An amount of `1,000 spent on repairs to machinery has been debited to
machinery account.
b] An amount of `2,000 withdrawn by the proprietor has been debited to
office expenses account.
c] A sum of `3,000 received from Radha has been credited to Sudha.
d] An amount paid towards salary of `4,000 has been debited to Rent
account.
e] Extension to building `50,000 has been debited to repairs account.
f] Furniture purchased for ` 10,000 has been debited to Purchases
account.

2] Rectify the following errors :

a] Salary paid `5,000 was debited to employee’s personal account.
b] Rent paid ` 4,000 was posted to landlord’s personal account.
c] Goods withdrawn by proprietor for personal use `1,000 were debited
to sundry expenses account.
d] Cash received from Kohli `2,000 was posted to Kapur’s account.
e] Cash paid to Babu `1,500 was posted to Sabu’s account.
f] Credit sales to Mohan ` 7,000 were not recorded.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 68 | P a g e

 3] Rectify the following errors:
a] Furniture purchased for `10,000 wrongly debited to Purchases account.
b] Machinery purchased on credit from Raman for `20,000 was recorded
through Purchases book.
c] Repairs on Machinery `1,400 debited to Machinery Account.
d] Repairs on overhauling of second hand machinery purchased `2,000
was debited to Repairs Account.
e] Sale of old machinery at book value of `3,000 was credited to Sales
Account.
f] Credit purchases from Rohan ` 9,000 were not recorded.

4] Rectify the following errors:

a] Depreciation provided on machinery `4,000 was not posted.
b] Bad debts written off `5,000 were not posted.
c] Discount allowed to a debtor `100 on receiving cash from him was not
posted to discount account.
d] Bill receivable for `2,000 received from a debtor was not posted.
e] Goods returned to Rakesh `4,000 were not recorded.
f] Credit sales to Mohan ` 7,000 were recorded as `700.

5] Rectify the following errors :

a] Credit sales to Mohan `7,000 were recorded in purchases book.
b] Goods returned to Rakesh `4,000 were recorded in the sales
return book.
c] Goods returned from Mahesh ` 1,000 were recorded in purchases
returns book.
d] Goods returned from Naresh ` 2,000 were recorded in purchases book.
e] Wages paid for installation of machinery `5,000 was posted to wages
account.

6] Rectify the following errors :

a] Credit sales to Mohan `7,000 were posted to Karan.
b] Credit Purchases from Rohan `9,000 were posted to Govind.
c] Goods returned to Rakesh `4,000 were posted to Naresh.
d] Goods returned from Mahesh `1,000 were posted to Manish.
e] Cash sales `2,000 were posted to commission account.
f] Cash received from Mandira `5,000 was not entered.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 69 | P a g e

 Rectification of errors after putting the difference in Trial balance as
suspense account:

7] Rectify the following errors assuming that the errors detected after the
difference in trial balance is placed to suspense account:
a] A credit purchase of `2,000 from Mahesh has been debited to his account.
b] A sum of `1,000 received from Vishnu has been debited to his account.
c] The total of sales return book has been overcast by `1000.
d] A sum of `800 paid to Krishna has been debited to his account as `80.
e] A credit sale of `4,000 to Anju has been credited to Anju’s account.
f] Payment of rent ` 2,500 has been posted twice to rent account

8] Rectify the following errors assuming that the errors detected after the
difference in trial balance is placed to Suspense Account:
a] Credit sales to Mohan `7,000 were not posted to his account.
b] Credit Purchases from Rohan `9,000 were recorded through Sales book.
c] Goods returned to Rakesh `4,000 were not posted.
d] Goods returned from Mahesh `1,000 were not posted.
e] Cash paid to Ganesh `3,000 was not posted.

9] Trial balance of Raju showed an excess debit of `6,000. He put the

difference to Suspense Account and discovered the following errors.
a] Depreciation written-off on the furniture `6,000 was not posted to
furniture account.
b] Credit sales to Rupam `10,000 is posted to his account as `7,000.
c] Purchases book undercast by `2,000.
d] Cash sales to Rana `5,000 were not posted to sales account.
e] Old machinery sold for `7,000 was credited to Sales Account.
f] Discount received `800 from Kanan on paying cash to him was not
posted at all.
Rectify the above errors.

10] Trial balance of Anuj did not agree. It showed an excess credit of `6,000.
He put the difference to Suspense Account. He discovered the following errors.
a] Cash received from Ravish `8,000 posted to his account as `6,000.

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 b] Returns inwards book overcast by `1,000.
c] Total of sales book `10,000 was not posted to sales account.
d] Machinery purchased for `10,000 was posted to purchases account
as `5,000
e] Credit purchases from Nayak `7,000 were recorded in sales book.
However, Nayak’s account was correctly credited.
Rectify the above errors.

Key Answers
Multiple Choice Fill in Blanks Matching True or False
Q.No Ans Q.No Ans Q.No Ans Q.No Ans
1 a 1 Balance a iv 12 True
2 c 2 End b vii 13 False
3 d 3 Accounts c ix 14 True
4 a 4 Omission d v 15 False
5 a 5 Principle e i 16 False
6 a 6 Compensating f ii 17 True
7 b 7 Credit g iii 18 False
8 b 8 Debit h vi 19 False
9 d 9 Debit i viii 20 True
10 d 10 Credit 21 True
11 Debit 22 False
12 credit

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 71 | P a g e

 CHAPTER - 07

DEPRECIATION, PROVISIONS AND RESERVES

PART - A
One Mark Questions:
I. Multiple Choice Questions:
1] What is the purpose of making a provision for depreciation in the accounts?
a] To ascertaining true net profit.
b] To show the current market value of fixed asset.
c] To make cash available to replace fixed asset.
d] To make a provision for repairs.
2] According to straight line method of providing depreciation, the depreciation
amount;
a] Remains constant
b] Increase each year
c] Decrease each year
d] May increase or decrease
3] Total amount of depreciation of an asset cannot exceed its
a] Depreciable value
b] Scrap value
c] Market value
d] Realisable value
4] According to fixed instalment method, the depreciation is calculated on;
a] Balance amount
b] Original cost
c] Scrap value
d] Market value
5] Salvage value means;
a] Definite sale price of the asset
b] Cash to be received when life of the asset ends
c] Cash to be paid when asset is disposed off
d] Estimated disposal value of the asset
6] Depreciation amount charged on a machinery will be debited to;
a] Repairs account
b] Cash account
c] Depreciation account
d] Machinery account

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 7] In accounting, becoming out of date or obsolete is known as;
a] Amortisation
b] Obsolescence
c] Depletion
d] Physical deterioration
8] Depreciation is charged on;
a] Tangible fixed asset
b] Intangible fixed asset
c] Current asset
d] Both (a) and (b)
9] Which of the following asset generally assumed not to depreciate?
a] Machinery
b] Building
c] Land
d] Vehicle
10] Under the diminishing balance method, the amount of depreciation is
calculated on;
a] Written down value of the asset
b] Market value of the asset
c] Original cost of the asset
d] Expected realisable value of the asset
11] Depreciation charges are;
a] Cash expenses
b] Financial expenses
c] Non-cash expenses
d] Non-operating expenses
12] Book value means;
a] Expected sale price
b] Current market price
c] Value as shown in the books of accounts
d] Original acquisition price
13] The book value after two years of an asset costing ₹10,000 depreciated at
10% on fixed instalment method is;
a] ₹9,000
b] ₹8,000
c] ₹1,000
d] ₹2,000

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 14] A machinery was purchased on 01-04-2020. Its installation was completed on
01-05-2020 and was put to use after its trial run on 01-06-2020. The effective
period for calculation of depreciation for the year 2020-21 is;
a] 12 months
b] 11 months
c] 10 months
d] 7 months
15] The estimated value of depreciable asset after its useful life is called;
a] Actual value
b] Replacement value
c] Residual value
d] Current value
16] In the books of X company. Ltd., the machine account shows a debit balance
of ₹50,000 on 01-04-2020. The machine was sold on 30-09-2021 for ₹40,000.
The company charges depreciation at 10% p.a on diminishing balance method.
What is the profit or loss on sale of machinery?
a] ₹2,500 profit
b] ₹2,500 loss
c] ₹2,750 loss
d] ₹2,750 profit
17] Original cost of asset is ₹10,000. Estimated life is 10 years. Expected solvage
value will be ₹2,000. What is the rate of depreciation under fixed instalment
method?
a] 10% p.a.
b] 9% p.a.
c] 8% p.a.
d] 7% p.a.
18] Accumlated depreciation account shows;
a] Debit balance
b] Credit balance
c] Nil balance
d] (a) or (b)
19] An increase in the value of asset is referred as;
a] Depreciation
b] Appreciation
c] Reverse depreciation
d] Reverse appreciation

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 20] Which of the following method of depreciation is not recognised by Income tax
law?
a] Straight line method
b] Diminishing balance method
c] Both
d] None of these
21] Which of the following is an example for capital reserve?
a] Workmen compensation fund
b] General reserve
c] Profit on sale of fixed assets
d] Dividend equilisation reserve
22] Which of the following is an example for revenue reserve?
a] Profit on sale of fixed assets
b] Profit on revaluation of fixed assets
c] Investment fluctuation fund
d] Profit prior to incorporation
23] Dividend equilisation reserve is;
a] Specific reserve
b] Secret reserve
c] General reserve
d] (b) or (c)

II. Fill in the blanks:

1] Depreciation amount remains fixed under_____ method of calculating
depreciation.
2] Depreciation amount is reducing year by year under _____ method of
calculating depreciation amount.
3] ___________method is not recognised by Income tax law.
4] __________refers to writing-off the cost of intangible assets.
5] The term __________is used in the context of extraction of natural resources.
6] Depreciation is a _______expense.
7] Provision for depreciation account is also known as__________account.
8] A part of profit set aside to meet future contingencies is called______.
9] ______is a charge against the revenue of the current period.
10] __________reserve is a reserve which does not appear in the balance sheet.

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 III. Match the following:
A B
a Amortization i Depreciation amount remain fixed
b Depletion ii Free reserve
c Straight line method iii Main cause for depreciation
d Diminishing balance method iv Writing off the intangible asset
e Wear and tear v Out-of-date
f Obsolescence vi Appropriation of profit
g Provision for depreciation vii Extraction of natural resources
h Provision viii Accumulated depreciation
i Reserve ix Depreciation amount reduces
j General reserve x Not shown in the balance sheet
k Secret reserve xi Charge against profit

IV. Very short answer type questions:

1] What is depreciation?
2] Which accounting standard is applicable to accounting for depreciation?
3] State any one cause of depreciation.
4] Expand ICMA.
5] Which method of providing depreciation is recognised by Income tax law?
6] The balance in the asset disposal account is transferred to which account?
7] What is provision?
8] What is reserve?
9] Give an example for revenue reserve.
10] Give an example for capital reserve.

State true or false in the following cases:

11] Depreciation is also charged on current assets
12] Depreciation is decline in the market value of tangible fixed assets
13] The main cause of depreciation is wear and tear caused by its usage
14] Depreciation must be charged so as to ascertain true profit or loss of the
business
15] Depletion term is used in case of intangible assets
16] Depreciation provides fund for replacement
17] When market value of an asset is higher than book value, depreciation is not
charged

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 18] Depreciation is charged to reduce the value of asset to its market value
19] If adequate maintenance expenditure is incurred, depreciation need not be
charged
20] General reserve is not to be shown in the balance sheet
21] Secret reserve is to be shown in the balance sheet

PART-D
Twelve Marks Problems:-
Straight Line Method:
1] X Co Ltd., acquired a Machine for `80,000 on 01.07.2021 and spent
`20,000 for its installation. On 01.04.2022 it sold the Machine for `80,000
and on the same day it purchased another Machine for `70,000. The
Company writes off depreciation at the rate of 10% on original cost every
year. The books of accounts closed on March 31st every year. The company
charges depreciation to Asset Account.
Preapre Machinery Account and Depreciation Account for first four years.
(Ans- Balance of Machinery Account on 31.03.2024 `56,000/- and
Loss on sale of Machine `2,500)

2] On 1st April 2021, Someshwar Co. Ltd., purchased a Machine for ` 2,00,000
and spent ` 20,000 on its installation. On 30.09.2022 it purchased another
machine for `1,00,000. On 01.01.2024, it sold the Machine which was
purchased on 30.09.2022 for `90,000. The company charges depreciation at
10% p.a on Straight Line Method.
The accounts are closed on 31st March every year.
Prepare Machine Account and Depreciation Account for first three years.
(Ans- Balance of Machine Account on 31.03.2024 ` 1,54,000/-
and Profit on sale of Machine `2,500)

3] On 01-01-2021, a firm purchased Machine costing ` 80,000. On 01-07-

2023, it sold the Machine for ` 60,000 and on same date a new machine was
purchased for `20,000. Depreciation was charged annually @ 10% per annum
on Straight Line Method. Accounts are closed on 31st March every year.
Show Machinery Account and Depreciation Account for first four years.
(Ans- Balance of Machinery A/c as on 31.12.2024 `18,500/-
Profit /loss on sale of machine is Nil)

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 4] On 01-04-2021, Avinash Ltd. purchased Machine costing `50,000 and
spent `10,000 for its installation. On 30-06-2022, it purchased new Machine
costing ` 40,000. On 30-09-2023, the machine which was purchased on 1-4-
2021 was sold for `42,300. Depreciation charged at 10% p.a. on Straight line
method. Accounts are closed on 31st March every year.
Show Machinery Account and Depreciation Account for first 3 years.
(Ans- Balance of Machinery A/c as on 31.03.2024 `33,000/-
and Loss on sale of machine `2,700)

5] M/s Ganesh transport company Ltd. purchased a Truck for ` 3,60,000 on

1-10-2021 and spent `40,000 for its body building work. On 01.04.2022, the
firm purchased another second hand Truck for `2,50,000. On 31.12.2023 it
sold the Truck which was purchased on 01.10.2021 for `2,95,000. Company
charges depreciation at the rate of 10% p.a. on Straight Line Method. The
books of accounts are closed on 31st March every year.
Prepare Truck A/c and Depreciation A/c for first 3 years.
(Ans- Balance of Truck A/c as on 31.03.2024 `2,00,000/-
Loss on sale of Truck `15,000)

6] On 1-4-2021, Sanket Co. Ltd purchased a Plant costing `80,000 and

spent `20,000 for its erection. On 31-12-2023, the plant was sold for
`65,000. On 01-01-2024, a new plant was purchased for `80,000. The
Company charges depreciation at 10% p.a. under traight Line Method.
Accounts are closed on 31st March every year.
Prepare Plant Account and Depreciation Account for first 3 years.
(Ans- Balance of Plant A/c as on 31-03-2024 `78,000/-,
Loss on sale of plant `7,500)

7] On 01.04.2021, Jain and co. Ltd., purchased a Machinery for `2,00,000 and
spent `25,000 for its transportation and installation. On 30.09.2023, the
Machinery was burnt by fire and the Insurance company settled the claims at
`85,000 as compensation. On the same day, new Machinery was installed at
a cost of `1,00,000. The company charges depreciation at 20% p.a. under
original cost method. Accounts are closed on 31st March every year.
Prepare Machinery A/c and Depreciation A/c for first 3 years.
Ans: Loss on Insurance claims: `27,500 Balance of Machinery A/c as on
31-03-2024: `90,000

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 8] On 01.04.2021, a company purchased Furniture for ` 60,000. On
30.09.2022, a part of the Furniture which was purchased on 01.04.2021
costing `10,000 was sold for `7,000. On 01.04.2023 additional Furniture
were purchased for `20,000. Depreciation was charged at 10% p.a. on
Straight line method. Accounts are closed on 31st march every year.
Show Furniture A/c and Depreciation A/c for first 3 years.
Ans: Loss on sale of Furniture: `1,500 and Balance of Furniture A/c as
on 31-03-2024: `53,000

Diminishing Balance Method:

9] M/s Shaha & Sons acquired a Machine for `90,000 on 01.07.2021 and spent
`10,000 for its installation. On 01.10.2023, they purchased another machine
for `60,000. On 30-11-2023 they sold the Machine which was purchased
01-07- 2021 for `75,000. The firm writes off depreciation at the rate of 10%
p.a. under Reducing Balance Method. Books of accounts are closed on 31st
March every year.
Prepare Machinery Account and Depreciation A/c the first 3 years
(Ans : Balance of Machinery A/c as on 31.03.2024 `57,000 and
Loss on sale of machine `2,700)

10] On 01-04-2020, Shastri Co. Ltd., purchased a Machinery costing `45,000

and spent `5,000 for its installation. On 31-03-2022 the machinery was
sold for `40,000. On 01-04-2022, the new machinery was bought for
`85,000. Depreciation was charged at 10% p.a. under Diminishing Balance
Method. Accounts are closed on 31st March every year.
Prepare - i) Machinery A/c and ii) Depreciation A/c for first 4 years.
(Ans- Balance of Machinery A/c on 31.03.2024 `68,850/-
Loss on Sale of Machinery ` 500

11] M/s Naresh Ltd. purchased a Truck for `3,00,000 on 01.01.2021. It was
decided to depreciate at 10.% p.a. on Reducing Balance Method. On
31.03.2022 Truck was sold for `2,60,000. On 01.04.2022, a new Truck was
purchased for `4,00,000. Accounts are closed on 31st March every year.
Prepare : i)Truck A/c ii) Depreciation A/c for first 4 years
Ans- Balance of Truck A/c on 31-03-2024 `3,24,000/- , and
Loss on sale of truck `3,250 )

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 12] M/s Patil and Company acquired a Machinery for `5,00,000 on 01-04-2020.
On 01-04-2023 it purchased another machinery for `1,50,000. On 30-09-
2023 it sold the machinery which was purchased on 01-04 -2021 for
`3,70,000. Depreciation is charged @ 10 % p.a. under Written Down value
Method.
Prepare Machinery A/c and Depreciation A/c for first 3 years.
(Ans- Balance of Machinery A/c on 31.03.2024, `1,35,000.
Profit on sale of Machinery `5,500 )

13] M/s Diwakar and Company purchased Machine ‘A’ for `2,00,000 on
01-04-2021. On 01-10-2021 Machine ‘B’ was purchased for `1,00,000. On
31-07-2023 Machine ‘B’ was sold for `82,000. It was decided to depreciate
the machines @ 10% p.a. under Diminishing Balance Method.
Prepare Machinery A/c and Depreciation A/c for first 3 years.
(Ans- Balance of machinery A/c on 31-03-2024 `1,45,800
Loss on sale of machine ‘B’ `650)

14] From the following particulars, prepare Machinery A/c and Depreciation A/c
for first three years ending on 31-03-2024 assuming that depreciation is
charged at 10% p.a. under Diminishing Cost Method.
a) Machine ‘X’ bought on 01-10-2021 for `45,000.
b) Machine ‘Y’ bought on 01-07-2022 for `30,000.
c) Machine ‘X’ was sold on 30-11-2023 for `36,500.
(Ans- Balance of machinery A/c on 31-03-2024 `24,975,
Profit on sale of machine ‘X’ `590)

15] On 01.04.2020, Praveen company Ltd., purchased Machinery for ``60,000.

On 01.04.2022, the Machinery was destroyed by fire and the insurance
company settled the claims at `40,000. On the same day, a new Machinery
was installed at a cost of `50,000. The company charges depreciation at 10%
p.a under diminishing balance method. Accounts are closed on 31st March
every year.
Show Machinery A/c and Depreciation A/c for first 4 years.
Ans: Loss on Insurance claims: `8,600 Balance of Machinery
A/c as on 31-03-2024: `40,500

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 Key Answers
Multiple Fill in Blanks Matching True or False
Choice
Q.No Ans Q.No Ans Q.No Ans Q.No Ans
1 a 2 Original cost/Straight a iv 11 False
line/Fixed instalment
2 a 3 Diminishing b vii 12 False
balance/Reducing
balance/Diminishing
cost/Written down value
3 a 4 Straight line c i 13 True
4 b 5 Amortisation d ix 14 True
5 d 6 Depletion e iii 15 False
6 c 7 Non-cash f v 16 True
7 b Accumlated depreciation g viii 17 False
8 a 9 Reserves h xi 18 False
9 c 10 Provision i vi 19 False
19 a secret j ii 20 False
11 c k x 21 False
12 c
13 b
14 c
15 c
16 c
17 c
18 b
19 b
20 a
21 c
22 c
23 a

******

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 CHAPTER - 08

FINANCIAL STATEMENTS - I

PART - A
One Mark Questions:
I. Multiple Choice Questions:
1] The financial statements consist of :
a] Trail balance
b] Profit and Loss Account
c] Balance Sheet
d] b and c
2] Choose the correct chronological order of ascertainment of the following
profits from the profit and loss account:
a] Operating profit ,Net profit, Gross Profit
b] Operating profit ,Gross profit, Net Profit
c] Gross profit, Operating profit, Net Profit
d] Gross profit, Net Profit ,Operating profit
3] While calculating operating profit, the following are not taken into account
a] Administrative expenses
b] Selling expenses
c] Finance expenses
d] Distribution expenses
4] Which of the following is correct?
a] Operating profit = Operating profit – Non Operating expenses -
Non operating incomes
b] Operating profit = Net profit + Non Operating expenses +
Non Operating incomes
c] Operating profit = Net profit +Non Operating expenses -
Non Operating incomes
d] Operating profit = Net profit – Non Operating expenses +
Non Operating incomes
5] Following forms the basis for preparing financial statements :
a] Trading Account
b] Profit & Loss Account
c] Trial Balance
d] Balance sheet

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 6] Among following, who is internal user of financial statements?
a] Bank
b] Government
c] Society
d] Owner
7] Among following, who is external user of financial statements?
a] Owner
b] Creditor
c] Manager
d] Employee
8] When benefit of an expenditure exhausted within one year, it is called as:
a] Capital Expenditure
b] Revenue Receipt
c] Revenue Expenditure
d] Capital Receipt
9] Following is example for a Capital Receipt:
a] Additional Capital
b] Rent received
c] Salary paid
d] Interest received
10] Sales Returns Account is closed by transferring its balance to____________
a] P&L A/c
b] Trading A/c
c] Sales A/c
d] Sales Return A/c
11] Purchases Returns A/c is closed by transferring its balance to____________
a] Trading A/c
b] Purchases A/c
c] Profit and Loss A/c
d] Purchases Returns A/c
12] Salary paid to salesmen is debited ____________
a] Trading A/c
b] Profit and Loss A/c
c] Cash A/c
d] Salesmen A/c .

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 II. Fill in the blanks:
1] Operating profit is the _______ of Operating revenue over operating expenses.
2] _______ is a list of all assets, Liabilities & Capital.
3] Arrangement of Assets &Liabilities in a particular order is known as_______
4] _______is any person associated with business.
5] Bank loan repayment is example for_______
6] Interest on Investment received by the business should be treated as_______
7] Unsold goods lying in the business at the end of the year is termed as_______
8] A Balance Sheet is prepared to know the _______position.
9] Net profit is transferred_______account.
10] Generally the beginning item on the debit side of Trading A/c will be_______
11] Rent received is credited to _______A/c.
12] Repairs are usually related to _______assets.

III. Match the Following:

A B
a] Closing Stock i. Internal user
b] Net Loss ii. External user
c] Current owner iii. Revenue Receipt< Revenue expenditure
d] Prospective owner iv. Credited to Trading account
e] Salary paid v. Capital Expenditure
f] Machinery purchased vi. Revenue Expenditure
g] Commission received vii. Debited to Trading account
h] Loan from Akash viii. Revenue receipt
i] Direct Expenses ix. Capital receipt
j] P&L Account x. Position statement
k] Balance sheet xi. Income statement
l] Drawings xii. Deferred revenue expenditure
xiii. Deducted from capital

IV. Very Short Answer Questions:

1] Gross profit is Total Revenue. (State True/False)
2] Rent, Rates & Taxes is an example of direct expenses. (State True/False)
3] If the total of the credit side of Profit & Loss A/c is more than total of the
debit side, the difference is net profit. (State True/False)
4] Financial position is determined by Balance Sheet. (State True/False)
5] Government is an internal user of financial statements. (State True/False)
6] Bank is an external user of financial statements. (State True/False)

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 7] Expand : C O G S.
8] What is Operating Profit?
9] Give the meaning of Balance sheet.
10] Name any one financial statement.
11] State an example for Capital Receipts.
12] State an example for Revenue Expenditure.
13] State the account which ascertain the result of basic operational activities of
business.
14] What is Profit & Loss Account?
15] Expand E B I T.

PART-B
V. Short Answer Questions for Two marks:
1] What do you mean by Closing entries?
2] What is Capital expenditure?
3] Give two examples of Capital expenditure.
4] Give the meaning of Gross Profit.
5] State two basic objectives of preparing financial statements.
6] Why do you prepare Trading and Profit and Loss Account?
7] What do you mean by ‘Cost of goods sold’?
8] What is Capital receipt?
9] Give two examples of capital receipt.
10] What is revenue receipt?
11] State any two distinction between capital receipts and revenue receipts.
12] State any two distinction between capital expenditure and revenue
expenditure.
13] What do you mean by revenue expenditure?
14] What is meant by Marshalling of Assets and Liabilities in the Balance
Sheet?.
15] State any two differences between Profit & Loss A/c and Balance Sheet.
16] What is Operating profit?
17] Name the two financial statements.
18] State any two internal users of financial statements.
19] Give two examples for revenue receipts.
20] Give two examples for revenue expenditure.
21] State any two external users of financial statements.
22] Pass closing journal entry for Closing Stock .
23] Pass closing journal entry for Drawings.

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 24] Calculate Cost of goods sold : Purchases `150,000 ;Direct expenses
`30,000 ; Closing stock `50,000.
25] Calculate Net profit : Gross profit `200,000 ;Indirect expenses
`140,000 ; Interest received `20,000.

PART – C
VI. Six Marks Questions/Short Problems: -
1] Compute cost of goods sold for the year 2023-24 with the help of the
following information.
`
Stock on 1st April, 2023 3,00,000
Stock on 31st March, 2024 4,00,000
Purchases during the year 15,00,000
Sales during the year 20,00,000
Wages 1,20,000
( Ans : ` 15,20,000)

2] From the following balances obtained from the records of Mr. Shankar,
prepare the Trading Account for the year ending 31st March ,2024:
`
Opening Stock 2,00,000
Purchases for the year 20,00,000
Sales for the year 35,00,000
Carriage inwards 10,000
Closing stock is valued 5,00,000
( Ans : Gross profit ` 17,90,000)

3] From the following balances of Sri Narayan, prepare Trading Account for the
year ended 31-3-2024.
` `
Cash purchases 10,000 Credit purchases 2,00,000
Cash sales 1,00,000 Credit Sales 2,20,000
Freight charges 10,000 Carriage inwards 2,000
Import duty 15,000 Stock on 31-3-2024 25,000
Stock 1.4.2023 30,000 Wages 5,000
( Ans : Gross profit `73,000)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 86 | P a g e

 4] Prepare a Trading Account of Naveen from the following information for the year
ending March 31, 2024.
` `
Opening stock 1,30,000 Factory rent 40,000
Purchases 6,50,000 Dock & clearing charges 95,000
Sales 15,00,000 Freight 15,000
Coal, gas & water 20,000 Closing stock 50,000
Carriage inwards 25,000 Import duty 10,000
(Ans: Gross profit `5,65,000)

5] From the following particulars, prepare Trading A/c.

` `
Sales 200,000 Opening stock 30,000
Purchases 92,000 Sales Returns 5,000
Wages 15,000 Closing Stock 20,000
Carriage Inward 10,000 Purchases Returns 2,000
Other direct expenses 5,000
(Ans: Gross Profit `65,000)

6] From the following information, calculate Gross Profit and Operating profit for
the year ending 31st March ,2024:
`
Opening Stock 1,00,000
Net Sales 24,00,000
Net Purchases 12,00,000
Direct expenses 1,20,000
Operating expenses 2,20,000
Closing Stock 1,40,000
( Ans : Gross Profit `11,20,000 Operating profit `9,00,000)

7] From the following particulars, prepare a Profit and Loss A/c for the year ending
31st March, 2024:
` `
Gross Profit 1,20,000 Salaries 20,000
Rents & Taxes 8,000 Insurance premium 2,000
Printing, Stationery & Postage 600 Advertisement 1,400
Office lighting 1,000 Depreciation on fixed asset 1,000
General expenses 600 Discount received 200
(Ans: Net Profit `85,600)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 87 | P a g e

 8] Prepare Profit & Loss A/c of Ramesh for the year ending 31st March, 2024:
` `
Gross Profit 1,30,000 Salaries 45,000
Rent & taxes 3,000 Printing & Stationery 5,000
Insurance 1,000 Depreciation on fixed assets 6,000
Bad debts 1,500 Discount received 4,500
Audit fees 400 Rent received 1,500
(Ans: Net Profit `74,100)

9] Prepare a Profit and Loss A/c for the year ending 31-3-2024 of Srinivas.
` `
Gross Loss 8,000 Rent received 64,000
General expenses 2,000 Bad debts recovered 3,000
Repairs & renewals 1,000 Salaries 12,000
Audit fees 1,000 Discount allowed 2,000
Depreciation 6,000 Advertisement 4,000
(Ans: Net Profit `31,000)

10] From the following particulars, prepare Profit & Loss A/c.
` `
Gross profit 60,000 Salary 4,500
Repairs 9,000 Rent received 7,000
Lighting 6,500 Interest received 4,000
Office Expenses 4,000 Commission paid 3,000
Discount allowed 8,500 Discount earned 2,000
( Ans : Net Profit `37,500)

11] Prepare Profit & Loss A/c:

` `
Gross Loss 15,000 Insurance 7,000
Commission received 4,000 Selling expenses 9,000
Discount earned 5,000 Bad debts 2,500
Interest received 5,500 Other operating expenses 8,000
Other operating incomes 6,000 Postage 2,000
( Ans : Net Loss `23,000)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 88 | P a g e

 12] Prepare a Balance Sheet of Mr. Narahari as on 31-3-2024.
` `
Capital 50,000 Drawings 10,000
Land & Building 20,000 Machinery 20,000
Furniture 10,000 Bills receivable 5,000
Cash in hand 5,000 Bank OD 6,000
Sundry creditors 10,000 Closing stock 11,000
Bank loan 10,000 Net Profit 5,000
(Ans: Total `71,000)

13] Prepare a Balance sheet as on 31-3-2024 of Sunil.

` `
Capital 14,000 Loan from bank 4,000
Creditors 2,400 Cash in hand 600
Plant & Machinery 7,520 Sundry Debtors 6,700
Drawings 2,000 Closing stock 9,160
Net Profit 5,580 Bank OD 16,000
Loan from Shankar 4,000 Investments 20,000
(Ans: Total `43,980)

14] Prepare Balance Sheet.

` `
Debtors 27,000 Bank balance(SBI) 3,500
Capital 90,000 Creditors 45,000
Machinery 60,000 Cash in hand 8,500
Closing stock 24,000 Bank OD ( Canara ) 42,000
Bills Receivables 12,000 Computers 75,000
Loan from friend 20,000 Bills Payables 13,000
( Ans : Total `2,10,000)

15] Prepare Balance Sheet.

` `
Closing stock 57,000 Sundry debtors 90,000
Cash 50,000 Capital 1,85,000
Sundry creditors 75,000 Fixed deposit 25,000
Drawings 7,000 Bank loan 37,000
Land 90,000 Loan to Ganesh 5,000
Net profit 47,000 Investments 20,000
( Ans : Total `3,37,000)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 89 | P a g e

 Key answer for short questions :
MCQs:
1.(d), 2.(c), 3.(c), 4.(c), 5.(c), 6.(d), 7.(b), 8.(c), 9.(a), 10.(c), 11.(b), 12.(b).

FILL IN THE BLANKS:

1. excess 2.Balance Sheet 3.marshalling
4. stakeholder 5. Capital expenditure 6.Revenue receipt
7. closing stock 8. financial 9.Capital
10. opening stock 11. Profit and Loss 12.fixed.

MATCH THE FOLLOWING:

a. (iv) b. (iii) c. (i) d. (ii) e. (vi) f. (v)
g. (viii) h. (ix) i. (vii) j. (xi) k. (x) l. (xiii).

TRUE OR FALSE:
1.False, 2.False, 3.True, 4.True, 5.False, 6.True

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 90 | P a g e

 CHAPTER - 09

FINANCIAL STATEMENTS - II

PART - A
One Mark Questions:
I. Multiple Choice Questions:
1] Closing stock is valued at __________
a] Cost price
b] Market price
c] Sales price
d] Cost price or Market price whichever is lower
2] Opening Stock appearing in the Trail Balance will be shown in __________
a] Trading account
b] Profit and Loss account
c] Balance sheet
d] Trading A/c and also in Balance sheet
3] Stock appearing outside the trail balance will be shown in __________
a] Trading account
b] Balance sheet
c] Trading A/c and Balance Sheet
d] Profit and Loss account
4] Liabilities have __________ balance
a] Debit
b] Credit
c] Either debit or credit
d] No balance
5] Outstanding expense is __________of the business
a] A Liability
b] An Asset
c] An Expense
d] An extraordinary loss
6] Capital is the difference between __________
a] Income and Expenses
b] Sales and cost of goods sold
c] Assets and liabilities
d] Operating Incomes and Expenses

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 91 | P a g e

 7] Interest on capital is __________ for the business.
a] Revenue
b] Expense
c] Gain
d] Income
8] Property tax payable is a __________
a] Current asset
b] Capital account
c] Expenses account
d] Liability account
9] Where do you show the Bad debts given in the Trail Balance at the time of
preparation of Financial Statements?
a] Trading A/c
b] Profit and Loss A/c
c] Balance Sheet
d] Not at all shown
10] In which account do you show the depreciation given in the Trail Balance
at the time of preparation of Financial Statements?
a] Profit and Loss account
b] Trading Account
c] Balance Sheet
d] Both in (a) and (c)
11] Bank overdraft is shown as a __________
a] Current liability
b] Contingent liability
c) Unsecured Loan
d] Provision
12] Full claim accepted by Insurance Company on the Loss of goods by fire is
credited to __________ A/c
a] Trading A/c
b] Profit and Loss A/c
c] Insurance Company A/c
d] Cash/Bank A/c
13] A surplus of revenue over its cost is known as __________ of the business
a] Capital
b] Profit
c] Asset
d] Loss

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 92 | P a g e

 14] Net profit is equal to __________
a] Sales - cost of goods sold
b] Sales – closing stock + purchases
c] Opening stock + purchases- closing stock
d] Gross Profit- Administrative and selling expenses
15] Which one show the business results of the concern for a period?
a] Trading A/c
b] Profit and Loss A/c
c] Balance Sheet
d] Trial Balance
16] Which of the following is not an intangible asset?
a] Account Receivable
b] Trade mark
c] Franchise
d] Goodwill
17] If the insurance premium paid is `1,000 and pre-paid insurance is `300,
the total amount of insurance shown in profit and loss A/c will be;
a] `1,300
b] `1,000
c] `300
d] `700

II. Fill in the blanks:

1] Closing stock is valued at cost or market price whichever is _______
2] Trading Account is prepared to ascertain _______
3] Profit and loss Account shows _______.of the business.
4] Balance sheet shows _______position .of the business enterprise.
5] Assets-Capital = _______.
6] Decrease in the value of fixed assets is called_______.
7] Bad debts recovered is recorded in _______.Account.
8] Patent is an _______.Asset.
9] Profit on sale of fixed asset is known as_______ Income.
10] Incomes earned but not received are called as_______incomes.
11] The expenses paid which are related to the next year are called-
_______expenses_
12] The expenses incurred but not paid up to the end of financial year are called
as_______expenses.
13] Incomes received but not earned are called as_______incomes

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 93 | P a g e

 14] Interest on capital is _______ to capital in Balance sheet.
15] Drawings are _______ from capital in Balance sheet.

III. Match the following:

A B
a. Closing Stock i. Added to Capital
b. Interest on Capital ii. Income
c. Drawings iii. Appear twice
d. Net Profit iv. Expense
e. Expenses Payable v. Financial position
f. Bad debts recovered vi. Financial performance
g. Trial Balance items vii. Intangible asset
h. Adjustment items viii. Appear once
i. Balance Sheet ix. Tangible asset
j. Trading and P & L A/c x. Long term liability
k. Trademarks xi. Current liability
l. Loan from Bank xii. Deducted from Capital
xiii. Appear thrice

IV. Very Short Answer Questions:

1] Give the meaning of adjustment.
2] State any one adjustment.
3] What is closing stock?
4] What is Outstanding expense?
5] On which side of the balance sheet, Prepaid expenses are shown?
6] Give the meaning of prepaid expenses.
8] What is meant by an Accrued income?
9] What is meant by Interest on capital?
10] Give the meaning of Provision for doubtful debts.
11] Write the meaning of Provision for discount on debtors.
12] What are Bad debts?
13] What is unearned income (Income received in advance)?
14] How do you treat, Provision for discount on debtors given in Adjustments,
while preparing Financial statements?
15] How will you treat accrued income given in adjustments while preparing
financial statements?
16] Prepaid expenses are assets of the business. (State True or False)
17] Unearned income is the liability of the business. (State True or False)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 94 | P a g e

 18] Accrued income or income due but not received are two different things.
(State True or False)
19] Unearned income means income received in advance. (State True or False)
20] Outstanding expenses account is a liability account. (State True or False)
21] Provision for discount on debtor is created only on good debtors.
(State True or False )
22] Bad debts are recoverable from the debtors. (State True or False)
23] Depreciation is the decline in the value of fixed assets due to wear and tear,
passage of time etc., (State True or False )
24] Interest on capital is an income of the business. (State True or False)
25] The statement of assets and liabilities is balance sheet. (State True or False)
26] Balance sheet discloses financial position of the business.
(State True or False )
27] A person to whom the business owes is called Debtor. (State True or False)
28] Provision for discount on debtors can be estimated only after computing the
provision for doubtful debts. (State True or False )
29] Balance sheet is an account. (State True or False )
30] Life insurance premium is treated as business expenses. (State True or False)

PART – B
V. Two Marks Questions:
1] Write adjustment entry for closing stock.
2] Write adjustment entry for expenses payable.
3] Pass journal entry for expenses paid in advance.
4] Pass journal entry for pre-received incomes.
5] Write journal entry for accrued incomes.
6] Give journal for rent unpaid for one month at `6,000 per annum.
7] Write journal entry for insurance prepaid for a quarter at `16,000 per
annum.
8] Give journal entry for outstanding salary ` 5,000.
9] State any two adjustments to be made while preparing financial statements.
10] Write journal entry for interest received in advance for one month at
`12,000 per annum.
11] Give journal entry for commission receivable for one month at `500.
12] What is adjustment entry?

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 95 | P a g e

 PART –D
VII. Twelve Marks Problems.
1] From the following Trail Balance, prepare Trading and Profit and Loss
Account for the year ending 31-3-2024 and the Balance Sheet as on that
date.
Name of the Account Debit (`) Credit (`)
Capital 30,000
Drawings 1,760
Purchases and Sales 8,900 15,000
Stock (on 1-4-2023) 1,200
Returns 280 450
Wages 800
Buildings 22,000
Freight charges 2,000
Trade expenses 200
Advertisement 240
Interest 650
Taxes and Insurance 430
Debtors and Creditors 6,500 1,200
Bills receivable and bills payable 1,500 700
Cash at bank 1,200
Cash in hand 190
Salaries 800
Total 48,000 48,000

Adjustments:
1] Stock on 31-3-2024 was valued at `10,000.
2] Insurance prepaid to the extent of `100.
3] Outstanding salaries `200.
4] Depreciate buildings by 5%.
5] Provide PDD at 5% on debtors.
(Ans: Gross Profit `12,270; Net Profit `9,725;
Balance Sheet Total `40,065)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 96 | P a g e

 2] From the following Trail Balance, prepare financial statements for the year
ended March 31st, 2024.
Debit Balances ` Credit Balances `
Machinery 8,000 Capital 18,000
Cash at Bank 2,000 Sales 32,000
Cash in hand 1,000 Sundry Creditors 9,000
Wages 2,000 Commission received 600
Purchases 16,000
Stock on 1-4-2023 12,000
Sundry Debtors 8,800
Bills Receivable 5,800
Rent 900
Legal expense 500
General expenses 1,600
Bad debts 1,000
Total 59,600 59,600
Adjustments:
1] Stock on 31-3-2024 `16,000.
2] Depreciate machinery at 10%
3] Rent prepaid `200.
4] Provide PDD at 5% on sundry debtors.
5] Commission received in advance `400.
(Ans: Gross Profit `18,000; Net Profit `13,160;
Balance Sheet Total `40,560)

3] Prepare the Trading and Profit and Loss Account and a Balance Sheet of
M/s Shine Stores, from the following particulars.
Account Title ` Account Title `
Sundry debtors 21,000 Bills Payables 18,000
Bad debts 2,000 Sundry Creditors 10,000
Printing and stationary 4,000 Return outwards 5,000
Freight 3,000 Capital 1,00,000
Sales returns 2,000 Sales 1,22,000
Motor car 20,000 Discount received 1,000

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 97 | P a g e

 Opening stock 25,000 Interest received 8,000

Furniture and fixtures 15,000

Purchases 75,000

Drawings 10,000
Cash in hand 7,000
Investments 80,000
Total 2,64,000 2,64,000

Adjustments:
1] Closing stock was valued at `30,000.
2] Further bad debts `1,000. Make a provision for bad debts at 5%
on sundry Debtors.
3] Depreciate motor car by 10% and furniture and fixture by 5%.
4] Accrued interest on investments `2,000.
5] Provide interest on capital at 5%.
(Ans: Gross Profit `52,000; Net Profit `47,250;
Balance Sheet Total `1,70,250)

4] The following balances have been extracted from the ledger accounts of M/s
Kolkata Stores, Davanagere. You are required to prepare the Trading and
Profit and Loss Account for the year ended 31/3/2024 and prepare Balance
Sheet on that date.
Debit balance ` Credit balance `
Opening stock 20,000 Capital 64,000
Furniture 10,000 Sales 1,10,000
Drawings on 10,000 Bank overdraft 10,000
Purchases 95,000 Bad debts provision 5,000
Bad debts 2,000 Bills Payable 6,000
Carriage 5,000 Apprenticeship premium 2,000
Bank deposit 15,000
Bank charges 1,000
Coal, gas and water 8,000
Trade expenses 4,000
Rent, rates and taxes 7,000
Debtors 20,000
Total 1,97,000 Total 1,97,000

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 98 | P a g e

Adjustments:
1] Closing stock `10,000.
2] Further bad debts `2,000. New Provision at 5% on debtors
for doubtful debts.
3] Depreciate furniture at 10 % .
4] Apprenticeship premium received in advance `500.
5] Interest receivable `400.
(Ans: Gross Loss `8,000; Net Loss `19,000;
Balance Sheet Total ` 51,500)

5] The following were the balances extracted from the books of Ramesh
Traders as on March 31st 2024.
Name of the accounts Debit Credit
balance (`) balance(`)
Purchases and Sales 50,000 1,23,000
Returns 3,000 2,000
Debtors and Creditors 32,000 9,000
Fuel and power 8,000
Carriage on purchases 2,000
Carriage on sales 5,000
Opening Stock 14,000
Freehold Land 30,000
Machinery 25,000
Patents 15,000
Drawings and capitals 12,000 95,000
Sundry expenses 3,000
Salaries 7,000
Bills Receivable and Bills Payable 13,500 5,000
Repair and Renewals 14,500
Total 2,34,000 2,34,000

Taking in to account the following adjustments, prepare Trading and Profit

and Loss Account and Balance Sheet on March 31st, 2024.
1] Closing stock `30,000.
2] O/S salaries `500.
3] Rent accrued but not received `500
4] Depreciate machinery at 10%.
5] Provide for the manager commission at 5% on net profit after charging
such commission.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 99 | P a g e

 (Ans: Gross Profit `78,000; Net Profit `43,810;
Balance Sheet Total `1,43,500)

6] From the following Trial Balance of Shri Narendra, prepare his Trading and
Profit and Loss Account for the year ended 31stMarch. 2024, and Balance
Sheet on that date.
Name of the accounts Debit Credit
` `
Opening stock 36,000
Purchases and sales 204,000 3,26,000
Drawings and capital 24,000 1,25,000
Carriage outwards 8,000
Bills Receivable and bills payable 18,000 20,000
Investments 10,000
Salaries 38,000
Wages 33,000
Sundry debtors and creditors 40,000 50,000
Buildings 50,000
Insurance and taxes 8,000
Commission 7,000
Returns 6,000 4,000
Plant and machinery 60,000
Cash and bank 17,000
Bank over draft 20,000
Total 5,52,000 5,52,000

Adjustments:
1] Closing stock valued at `52,000.
2] Outstanding Expenses: Interest on bank over draft `1,000 and
salary `2,000.
3] Commission accrued `1,000.
4] Depreciate plant and machinery by 10%.
5] Provide discount on debtors at 5%.
(Ans: Gross Profit `1,03,000; Net Profit `46,000;
Balance Sheet Total `2,40,000)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 100 | P a g e

 7] Prepare Financial Statements for the year ending March 31st, 2024, from the
Trail Balance and adjustments given below.

Trail Balance as on 31-3-2024

Name of accounts Debit Credit
` `
Drawings and capital 5,000 30,000
Opening Stock 13,200
Purchases and sales 40,000 60,000
Debtors and creditors 10,000 8,500
Salary 500
Bad debts 300
Printing and stationary 1,200
Wages 1,000
Postage 800
Bills Receivables and Bills Payables 3,000 3,000
Furniture 7,500
Cash in hand 1,500
Bank overdraft 2,000
Machinery 18,000
Commission received 1,500
Advertisement 3,000
Total 1,05,000 1,05,000

Adjustments:
1] Closing stock `10,300.
2] Depreciate machinery at 5% and furniture at 10%.
3] Create provision for doubtful debts at 5% on debtors and discount
on debtors at 2%.
4] Interest on capital at 5%.
5] Provide for the manager commission at 10% on net profit before
charging such commission.

(Ans: Gross Profit `16,100; Net Profit `7,164;

Balance Sheet Total `47,960 )

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 101 | P a g e

 8] From the following Trail Balance of Shri Krishna, prepare his Trading and
Profit and Loss Account for the ended 31/03/2024 and Balance Sheet as on
that date.
Name of the accounts Debit Credit
` `
Commission received 3,000
Cash at bank 3,500
Purchases and Sales 41,000 99,000
Returns 4,000 1,000
Wages 12,500
Carriage inward 2,000
Carriage on sales 3,500
Opening stock 6,000
Buildings 40,000
Machinery 20,000
Capital 60,000
Salary 15,000
Sundry debtors and creditors 22,500 8,000
General expenses 3,000
Insurance 2,000
Rent received 5,000
Drawings 5,000
Provision for doubtful debts 4,000
Total 1,80,000 1,80,000

Adjustments:
1] Outstanding salary for the month of March 2024, `1,000.
2] Rent due but not received `2,000.
3] Further bad debts `1,000 and make provision for doubtful debts
at 5% on debtors.
4] Stock was valued on 31/03/2024, `7,000.
5] Depreciate machinery at 10% and building by 5%.
(Ans: Gross Profit `41,500; Net Profit `24,925;
Balance Sheet Total `88,925)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 102 | P a g e

 9] From the following Trail Balance of M/s Natural Device Bengaluru, prepare
the Trading and Profit and Loss Account f.y.e.March 31st,2024 and Balance
Sheet as on that date.
Trial Balance as on 31-03-2024

Account Title Debit Credit

` `
Drawings and Capital 19,530 67,500
Purchases and Sales 45,000 1,12,500
Salary and Commission 25,470 1,575
Wages 13,915
Plant and Machinery 27,000
Furniture 6,800
Opening Stock 42,300
Insurance premium 2,700
Interest 7,425
Bank over draft 24,660
Carriage outwards 3,645
Returns 2,385 1,440
Debtors and creditors 36,000 58,500
General expenses 6,925
Octroi 530
Investments 41,400
Total 2,73,600 2,73,600

Adjustments:

1] Interest on capital at 10%.

2] Closing stock valued `19,940.

3] Outstanding Expenses were: Wages `50 and Salary ` 20.

4] Make provision for doubtful debts on debtors at 5%.

5] Depreciate plant and machinery at 5%.

(Ans: Gross Profit `29,700; Net Loss `9,960;

Balance Sheet Total `1,27,990 )

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 103 | P a g e

 10] Prepare the Trading and Profit and Loss Account and Balance Sheet of
Naveen Traders, Vijayapur from the following particulars.
Trial balance as on 31/3/2024
Account Title Debit Credit
` `
Sundry Debtors and Creditors 100,000 25,000
Bad debts 3,000
Printing and Stationery 7,500
Rent ,Rates and Taxes 3,450
Freight 2,250
Returns 6,000 4,500
Motor car 25,000
Openings Stock 75,550
Furniture 15,500
Purchases and Sales 75,000 1,00,000
Drawings and Capital 13,560 2,50,000
Investments 65,500
Cash at Bank 89,000
Bills Payable 85,550
Provision for bad debts 1,500
Interest Received 11,260
Discount Received 3,500
Total 4,81,310 4,81,310

Adjustments:
1] Closing stock was valued `35,000.
2] Depreciate furniture at 5% and motor car at 10%.
3] Further bad debts `1,000 and make a provision for bad debts at 2%.
4] Commission earned but not received `555.
5] O/S Rent, Rate and Taxes `200.
(Ans: Gross Loss `19,300; Net Loss `22,890;
Balance Sheet Total `3,24,300)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 104 | P a g e

 11] From the following Trail Balance of a Trader, prepare Trading and Profit and
Loss Account for the year ending 31/3/2024 and Balance Sheet as on that
date.
Trial balance as on 31/3/2024

Name of the Accounts Debit Credit

` `
Capital 20,000
Drawings 1,700
Machinery 12,000
Scooter 2,600
Debtors and Creditors 3,600 2,600
Purchases and Sales 2,000 4,200
Wages 800
Cash 2,600
Salaries 800
Repairs 190
Stock on 1/4/2023 1,600
Rent 450
Manufacturing Expenses 150
Bills Payable 2,350
Bad debts 500
Carriage on Sales 160
Total 29,150 29,150

Adjustments :
1] Closing stock as on 31/3/2024 `1,600.
2] Depreciate machinery by 10% and scooter by 15%.
3] `150 are due for wages.
4] Paid rent `50 in advance.
(Ans: Gross Profit `1,100; Net Loss `2,540;
Balance Sheet Total `20,860)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 105 | P a g e

 12] From the following Trial Balance of Mahesh as on 31/3/2024, prepare
Financial Statements:
Trial balance as on 31/3/2024
Name of the accounts Debit Credit
` `
Capital 1,20,000
Drawings 15,000
Bills Receivable 22,000
Machinery 20,000
Debtors and Creditors 60,000 58,000
Wages 39,000
Purchases and Sales 2,52,000 3,55,000
Commission 5,500
Rent and Taxes 6,000
Stock on 1/4/2023 90,000
Salaries 10,500
Travelling expenses 2,000
Insurance 600
Repairs 3,400
Bad debts 3,500
Furniture 9,000
Returns 5,000 2,000
Cash in Hand 500
Cash at Bank 2,000
Total 5,40,500 5,40,500

Adjustments:

1] Stock on hand on 31/3/2024 was `1,00,000.

2] Create 5% provision on debtors.

3] Commission earned but not received `500.

4] O/S wages `1000 and salaries `1,500 .

5] Depreciate machinery by 5% and furniture by 10%.

(Ans: Gross Profit `70,000; Net Profit `43,600;

Balance Sheet Total `2,09,100)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 106 | P a g e

 13] From the following Trail Balance, prepare a Trading, Profit and Loss Account
and Balance Sheet after taking into account the adjustments given here
under.
1] Stock as on 31/03/2024 was valued at `18,400.
2] Write off further bad debts `300 and provision for doubtful debts
at 5% on debtors.
3] Outstanding expenses were :Rent `200 and salaries `500.
4] Unexpired insurance amounted to `400.
5] Depreciate plant and machinery by 5% and furniture and fittings
by 10%.
Trail balance as at 31/03/2024.
Name of the Accounts Debit Credit
` `
Drawings and Capital 9,000 40,000
10% investments 10,000
Interest on Investment 900
Opening Stock 14,000
Purchases and Sales 65,000 96,500
Carriage 1,400
Return Inwards 1,500
Sundry Debtors and Creditors 10,300 8,000
B/R and B/P 5,000 6,600
Salaries 7,000
Wages 4,000
Plant and Machinery 12,000
Furniture and Fittings 4,000
Trade expenses 700
Rent, Taxes and Insurance 2,300
Discount 200
Cash in Hand 600
Cash at Bank 4,600
Bad debts 400
Total 1,52,000 1,52,000

(Ans: Gross Profit `29,000; Net Profit `17,300;

Balance Sheet Total `63,600)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 107 | P a g e

 14] From the following Trail Balance of Sri Chandan Traders Mysore, prepare
the Financial Statements for the year ending 31/03/2024.

Name of the Accounts Debit Credit

` `
Capital 25,000
Drawings 2,500
Land and Buildings 5,000
Plant and Machinery 3,000
Purchases and Sales 40,000 50,000
Returns 5,000 4,000
Stock on 1/4/2023 7,500
Furniture 5,000
Salaries 1,150
Insurance 200
Debtors and Creditors 7,600 5,500
B/R and B/P 2,400 2,000
Commission 300
Interest 100
Carriage Inwards 300
Wages 1,200
Investments 2,000
Printing and Stationary 800
Cash in Hand 3,250
Total 86,900 86,900

Adjustments:
1] Closing stock was valued at `13,000.
2] O/S Liabilities were: wages `400 and salaries `500.
3] Insurance was prepaid to the extent of `50.
4] Depreciate land and building at 5% and plant and machinery at 10%.
5] Make provision for doubtful debts at 5% on debtors.
(Ans: Gross Profit `12,600; Net Profit `9,470;
Balance Sheet Total `40,370)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 108 | P a g e

 15] From the following particulars of Ledger Balances of Sri Vignesha retailer,
Bagalkot for the year ending 31/03/2024, prepare the Trading and Profit
and Loss account and Balance Sheet as on that date.
Trail Balance as on 31/03/2024.
Name of the accounts Debit Credit
` `
Capitals 30,000
Drawings 2,500
Loan from Narayan 2,000
Sundry Debtors and Creditors 40,000 25,000
Purchases 75,000
Sales 135,000
Stock on 1/4/2023 30,000
Purchase Return 2,000
Sales Return 3,000
Commission 1,000
Bills Payables 10,000
Salaries 7,500
Advertisement 1,000
Bad Debts 300
Rent 800
Land and Building 25,000
Furniture 5,000
Govt Securities 10,000
Cash at Bank 4,900
Total 2,05,000 2,05,000

Adjustments:
1] Stock on 31/03/2024 `20,000.
2] Interest at 5% on Govt securities earned but not received
3] Depreciate land and building at 2% and furniture at 10%
4] O/S salaries `500.
5] Make provision for doubtful debts at 2% on debtors.
(Ans: Gross Profit `49,000; Net Profit `38,600;
Balance Sheet Total `1,03,600)

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 109 | P a g e

 Key Answers to:
MCQs:
1.(d), 2.(a), 3.(c), 4.(b), 5.(a), 6.(c), 7.(c), 8.(d), 9.(b), 10.(a),
11.(a), 12.(a), 13.(b), 14.(d), 15.(b), 16.(a), 17. (d) .

Fill in the Blanks:

1. less 2.Gross Profit 3.result 4.financial 5. Liabilities
6. depreciation 7.Profit and Loss 8.intangible
9. Non operating 10. Accrued 11.prepaid
12. outstanding 13. pre received 14.added
15.deducted.

Match the following:

a.(ix) b.(iv) c-(xii) d-(i) e-(xi) f-(ii)
g-(viii) h-(iii) i-(v) j-(vi) k.(vii) l.(x).

True or False:
16. True 17. True 18.False 19.True 20.True 21.True
22.False 23. True 24.False 25.True 26.True 27.False
28.True 29.False 30.False.

REVIESED QUESTION BANK (DPUE)– 2024-25 I - PUC 110 | P a g e