General Instructions:

1. This question paper contains 34 questions. All questions are compulsory.

2. This question paper is divided into two parts, Part A and B.
3. Question 1 to 17 and 27 to 29 carries 1 mark each.
4. Questions 18 to 20 and 30 to 32 carries 3 marks each.
5. Questions from 21 to 23 carries 4 marks each.
6. Questions from 24 to 26, 33 and 34 carries 6 marks each.

Part A
1. Cash memo is prepared when goods are sold [1]

a) both on credit and cash b) on credit

c) On transfer d) on cash

2. Assertion (A): Accounting is merely concerned with recording of the financial events.
[1]
Reason (R): Accounting also provides insightful information that helps businesses
in their decision making process.

a) Both A and R are true and R is the correct b) Both A and R are true but R is
not the explanation of A. correct explanation of A.

c) A is true but R is false. d) A is false but R is true.

3. Debit mean [1]

a) a decrease in asset b) an increase in the proprietor’s equity

c) an increase in asset d) an increase in liability

4. Goods costing Rs.15,000 were sold for cash at a profit of 20%. By what amount cash
increase [1]

a) Rs.13,000 b) Rs.12,000

c) Rs.18,000 d) Rs.15,000
 OR
Goods costing Rs. 15,000 were sold for cash at a profit of 20%. By what amount stock
account will decrease:

a) Rs.20,500 b) Rs.15,000

c) Rs.25,000 d) Rs.1,500

5. Pulkit has returned goods worth ₹20,000 to Mohan as he found it defective. Which
document will be prepared [1] by Mohan?

a) Credit note b) Debit note

c) Invoice/bill d) Credit voucher

6. ________ need the information to form policies at the macro level and for providing
subsidies. [1]

a) Competitors b) Management

c) Tax authorities d) Government and its agencies

OR
Stores is one of the accounting terms used to describe certain kind of materials in the
production process. Which of the following is an example of stores?

a) Lubricants b) Packing materials

c) All of these d) Spare parts of machinery

7. Reserve is created from: [1]

a) Liabilities b) Assets

c) Profits d) Losses

8. The data is classified for creating groups of accounts in the heads of: [1]

a) Assets, Liabilities and Capital b) Assets, Owners’ equity, Revenue and

Expenses

c) Assets, Capital, Liabilities, Revenue and Expenses

d) Capital, Revenue and Expenses
OR
Sundry Creditors Account is a:
 a) Liability Account b) Asset account

c) Capital Account d) Revenue Account

9. To promote worldwide uniformity in published accounts, the International

Accounting Standards Committee (IASC) has been set up in June

a) 1975 b) 1972

c) 1973 d) 1971

10. According to the Convention of Conservatism: [1]

a) Recording is made of outstanding expenses b) Depreciation is charged on assets

c) Provision is made for bad and doubtful d) All of these debts

11. Reserves are important because they help in: [1]

A. meeting the future contingencies
B. strengthening the financial position of the business
C. redemption of liabilities like debenture

a) (A) b) All of these

c) (B) d) (C)
12.Which of the following is an asset? [1]

a) Sales Return b) Purchases

c) Interest Received d) Machinery

13. If XYZ Electronics Ltd. purchases 20 TV @ ₹2,000 per piece and 15 tape recorders @
₹12,500 per piece. There [1] was a trade discount of 20%. What will be the amount
recorded in the purchase book?
a) ₹2,27,500 b) ₹1,87,500

c) ₹40,000 d) ₹1,82,000

14.Payment to a creditor means

a) Increase in asset and increase in liability b) Increase in asset and decrease in liability.
c) Decrease in asset and increase in liability. d) Decrease in asset and decrease in liability.
[1]

15. Which of the following is Revenue Expenditure? [1]

a) Purchase of Investments b) Expenses on purchase of Machinery
c) Building Construction Expenses d) Repair Expenses

OR
The amount invested by the proprietor in a business is called ________.

a) capital b) revenues

c) cash d) loan

16. ________ is not a subsidiary book. [1]

a) Sales Book b) Ledger

c) Purchase Return Book d) Purchase Book

17. To whom do the reserves belong to: [1]

a) Debtor b) Creditors

c) Seller d) Proprietor

18. Write the process of preparing ledger from a journal. [3]

OR

Purchased goods from Ajay for ₹ 15,000.

Goods costing ₹ 12,000 sold to Mr. X, issued an invoice at 25% above cost less 10% trade discount.

OR
Production at a factory had to stop for a week due to a labour strike. The owner
estimated the loss of production and the likely loss of profit arising out of the
 situation. He directed the accountant to record the loss in the books of account. Is the
owner correct in recording the likely loss? Give reasons.
20. Distinguish between Loss and Expense. [3]
21. From the following information, draw up a Trial Balance in the books of Shri Haridas
Chaki as on 31st March, 2023:
Capital ₹ 1,40,000; Purchases ₹ 36,000; Discount Allowed ₹ 1,200; Carriage Inwards ₹
11,000; Sales ₹ 60,000;
Returns Inward ₹ 300; Returns Outward ₹ 700; Plant and Machinery ₹ 1,15,300; Stock
on 1st April, 2022 ₹
16,700; Sundry Debtors ₹ 20,200; Sundry Creditors ₹ 12,000; Investments ₹ 3,600;
Commission Received ₹ 1,800; Cash in Hand ₹ 100; Cash at Bank ₹ 10,100 and Stock
on 31st March, 2023 (not adjusted) ₹ 20,500. [4]

22. Prepare double column cash book from the following transactions for the year August
2017: [4]
i. Balance as per the Passbook ₹ 50,000

ii. Three cheques for ₹ 6,000, ₹ 3,937 and ₹ 1,525 issued in last week July 2023 were

presented for payment to the bank in August 2023.

iii. Two cheques of ₹ 500 and ₹ 650 sent to the bank for collection were not entered in

the Pass Book by July 31, 2023.

iv. The bank charged ₹ 460 for its commission and allowed interest ₹ 100 which were

not mentioned in the Bank Column of the Cash Book.

OR
The credit balance as per cash book is Rs 1,500. Cheques for Rs 400 were deposited
but were not collected. The cheques issued but not presented were Rs 100, Rs 125 and
Rs 50. Balance as per pass book will be.
24.Journalise the following transactions of Govind: [6]

OR
Pass the Journal entries for the following transactions of Suraj:
 Sold goods to Ritik against cheque

Received cheque from Ramesh and allowed 2% Cash Discount

25. There was an error in the Trial Balance of Ravi Gupta on 31st March 2023 and the
difference in books was carried to the Suspense Account. On going through the books
you find that.

i. ₹ 540 received from Madhav was posted to the debit side of his account.

ii. ₹ 100 being purchases returns was posted to the debit of Purchases Account.

iii. Discount of ₹ 300 received were posted to the debit of Discount allowed Account.

iv. ₹ 374 paid for motor car repairs was debited to Motor Car Account as ₹ 174.
 v. ₹ 400 paid to Nitin was debited to the account of Mahesh.
Pass the Journal Entries to rectify the above errors, and state what amount was
carried to the Suspense Account.
[6]
OR
Trial Balance of Anurag did not agree. It showed an excess credit ₹ 10,000. Anurag
put the difference to suspense account. He located the following errors:
i. Sales Returns book overcast by ₹ 1,000.
ii. Purchases book was undercast by ₹ 600.
iii. In the sales book, a total of page No. 4 was carried forward to page No. 5 as ₹ 1,000

instead of ₹ 1,200 and total of page No. 8 was carried forward to page No. 9 as ₹
5,600 instead of ₹ 5,000.
iv. Goods returned to Ram ₹ 1,000 were recorded through Sales Book.

v. Credit purchases from M & Co. ₹ 8,000 were recorded through Sales Book.

vi. Credit purchases from S & Co. ₹ 5,000 were recorded through sales Book.

However, S & Co. were correctly credited.

vii. Salary paid ₹ 2,000 was debited to Employee's Personal Account.

26. Calculate annual depreciation and rate of depreciation under Straight Line
Method
in each of the alternative
 OR
The cost of the Machinery in use with Pramod & Co. on 1st April 2013 was Rs 3,00,000
against which the depreciation provision stood at Rs 1,00,000 on that date. The firm
provided depreciation at 10% on the diminishing value.
On 1st October 2013, a machine costing Rs 40,000 purchased on 1st April 2011 was
sold for Rs 32,000 and on the same date, another machine was purchased for 50,000.
Show the following accounts in the books of Pramod & Co.
for the year 2013-14:
i. Machinery Account
ii. Provision for Depreciation Account iii. Machinery
Disposal Account
Part B
27. Calculate Drawing from the following information: Profit: Rs.4,000,
Opening capital-Rs.30,000, Closing capital- Rs.35,000, fresh capital-Rs.6,000
a) Rs.12,000 b) Rs.5,000
c) Rs.500 d) Rs.16,000
OR
Capital in the beginning - Rs.16,000, profit made during the year - Rs.6,000, capital at
the end - Rs.26,000, Capital introduced during the year- Rs. 8,000. Calculate drawings:
a) Rs.8,000 b) Rs.10,000

c) Rs.20,000 d) Rs.4,000

28. Preliminary expenses are [1]

a) Fictitious asset b) Revenue receipt.

c) Deferred capital receipt. d) Deferred revenue receipt

29. A machine was purchased in U.P. During transit, the machine was damaged and the
cost of repairs incurred is ₹ 20,000. This expense is treated as:
a) Capital expense b) Revenue expense
c) cost d) Deferred Revenue expense
Income tax in case of sole trader is treated as OR
a) Business expenses b) Personal expenses
c) Owner expense d) Debtors expenses
30. State with reasons whether following are Capital or Revenue Expenditures: [3]
 i. Customs duty paid on import of machinery.

ii. ₹ 5,000 spent on repainting the factory.

iii. Repairs for ₹ 2,000 of the machine.

iv. ₹ 10,000 paid for the electricity bill.

31. Explain the objects of preparing Profit and Loss Account. [3]
32. Give Journal entries for the following adjustments in final accounts:

i. New Machinery was purchased for ₹ 1,00,000, paid as follows:

ii. An old machine valued at ₹ 10,000 (Book Value Nil) was given in exchange.

a. Balance amount by cheque.

b. The new machine was recorded at the net amount.

iii. New furniture was purchased for ₹ 50,000 and in exchange old furniture valued

at ₹ 5,000 (Book Value ₹ 2,000) was given. Entry for purchase was recorded at ₹
45,000 in the books of account. iv. A new car for ₹ 5,00,000 was purchased and
Amar (proprietor) gave his personal car valued at ₹ 1,00,000 in exchange. Car
was recorded in the books of account at ₹ 4,00,000.
v. The advance of ₹ 50,000 for the purchase of a building remained unadjusted.

vi. An old discarded asset was sold for ₹ 5,000 against cash which was used by the

proprietor for his personal use. ₹ 5,000 was included in Cash-in-Hand.

vii. Amrish, proprietor of Amrish & Co. sold his old car for ₹ 2,00,000 against cheque

which is deposited in his savings account.

33. Gopal Sharma maintains incomplete records of his business. He wants to know the
result of his business on 31st [6]

Cash in hand

Creditors
 Personal expenses of Gopal Sharma paid from business account amounted to ₹
4,80,000 and goods worth ₹ 20,000 were withdrawn by him for personal use. He
sold ornaments of his wife for ₹ 3,50,000 and invested that amount into the
business. Calculate his profit or loss.
OR
Mr. A started business with a capital ₹ 5,00,000. At the end of the year his position
was:

Cash in hand

Cash at bank

Sundry creditors on this date totalled ₹ 80,000. During the year, he introduced a
further capital of ₹ 1,50,000 and withdrew for household expenses ₹ 90,000.
You are required to calculate profit or loss during the year.

34. From the following figures prepare the Trading and Profit and Loss Account for the year
ended 31st March, 2023 and the Balance Sheet as at that date:-
Adjustments:-
i. Commission include ₹ 1,600 being commission received in advance.
ii. Write off ₹ 2,000 as further Bad-debts and maintain Bad-debts provision
at 5% on debtors. iii. Expenses paid in advance are: Wages ₹ 5,000 and
Insurance ₹ 1,200. iv. Rent and Salaries have been paid for 11 months.
v. Loan from X has been taken at 18% p.a. interest.

vi. Depreciate furniture by 15% p.a. and Motor Car by 20% p.a.

vii. Closing Stock was valued at ₹ 60,000.

OR
From the following particulars taken out from the books of Anand General Store,
prepare trading and profit and loss account for the year ended 31st March 2013 and
balance sheet as on that date.
Plant and machinery on 1st April
Rent

Additional Information
i. Closing stock Rs 1,10,000 stock valued at Rs 20,000 was

destroyed by fire on 18th March, 2013 but the insurance

company admitted a claim of Rs 13,600 only which was
received in April, 2013.
ii. Stationery for Rs 300 was consumed by the proprietor. iii.

Goods costing Rs 2,400 were given away as charity. iv. A new

signboard costing Rs 3,000 is included in advertising.
v. Rent is to be allocated 2/3rd to factory and 1/3rd to office.

vi. Depreciate machinery by 10% and motor car by 20%.