Page 1 of 7 ST. JOSEPH’S COLLEGE OF COMMERCE (AUTONOMOUS)
END SEMESTER EXAMINATION – SEPT/OCT. 2018 B.Com (T.T.)- I SEMESTER
C2 17 MC 101: FINANCIAL ACCOUNTING
Duration: 3 Hours Max. Marks: 70 SECTION - A
I) Answer any TEN questions. Each carries 1 mark. (10x1=10) 1. Classify the following into assets/liabilities/ expense/income/equity:
Patents
Goodwill written off Dividend received Long term borrowings
2. State any two objectives of Trial Balance?
3. What is meant by trend analysis?
4. Give any 2 limitations of ratio analysis?
5. State any two challenges in implementation of Ind AS?
6. Explain the treatment of the following adjustments while preparing final accounts :
a. Unearned income b. Accrued Income
7. Bring out any 2 points of resemblance between Trial Balance and Balance sheet.
8. Average stock of a firm is Rs. 1,00,000 and its opening stock is Rs. 10,000 less than closing stock. Calculate its opening and closing stock.
9. Write a note on turnover ratio.
10. A machine is purchased for Rs. 4,000 in cash. The machine was delivered on the same day as the payment was made. It is expected to be used over a 4- year period to make widgets that will be sold profitably. At the end of the 4-year period, the asset will be scrapped.
Required: How should the purchase of the machine be recognised and measured.
11. Name any two types of errors with an example.
12. What is a cash flow statement?
SECTION - B
II) Answer any THREE questions. Each carries 6 marks. (3x6=18) 13.
S.
No Items Financing
Enterprise Non Financing Enterprise 1 Purchase of securities of a Company
2 Brokerage paid for the purchase of securities
REG NO:
Page 2 of 7 3 Sale of securities of a company
4 Loans and advances given 5 Receipts from the repayments of
loans and advances
6 Interest received on securities
Classify the above activities into a. Operating activities b. Investing activities C. Financial activities.
14. a) Briefly explain the four pillar of accounting? (4 Marks) b) From the following information, you are required to calculate Equity of a Company. (2 Marks)
Equity Share Capital = Rs. 22,00,000
12% Preference Share Capital = Rs. 11,00,000 Securities Premium = Rs. 50,000
Capital Reserve = Rs. 1,50,000 Revaluation Reserve = Rs. 3,00,000 Profit and Loss A/c = Rs. 50,000 (Dr) 10% Debentures = Rs. 15,00,000 Trade Payables = Rs. 12,00,000
15. Information relating to Asta Traders is given below.
Gross profit ratio = 25%
Net profit ratio = 20%
Sales to inventory ratio = 8 times
Fixed assets to total current assets = 3 /4 Fixed assets to total capital = 3/2
Capital to total outside liabilities = 2/5 Fixed assets = Rs. 15, 00,000
Closing stock = Rs. 2, 00,000
With the above information find out:
1) Cost of sales 2) Gross profit 3) Net Profit
4) Value of Current Assets 5) Amount of Capital 6) Amount of Liabilities
Page 3 of 7 16. There was a difference of Rs. 1,050 in a Trial Balance. It has been
transferred to credit side of Suspense a/c. Later on following errors were discovered. Pass the rectification entries and prepare the suspense account.
An amount of Rs. 750 has been posted on the debit side of commission account instead of Rs. 550.
Goods of Rs. 400 purchased from Mohan Lal has been posted to his account as Rs. 450.
Total sales returns book was overcast by Rs. 950.
Only Rs. 40 were recorded in bills receivable book instead of Rs. 400
Goods of Rs. 600 were sold to Rajesh, but it was recorded in Purchase book.
17. Write a Short Note on:
a) Ind AS 8 b) Ind AS 10
SECTION - C
III) Answer any TWO questions. Each carries 15 marks. (2x15=30) 18. You are given the following figures:
Current ratio – 2.5 Liquidity ratio – 1.5
Net working capital – Rs. 6,00,000
Fixed asset turnover ratio (on cost of sales) – 2 times Average debt collection period – 2 months
Stock turn over ratio (on cost of sales/closing stock) – 6 times Gross profit ratio – 20%
Fixed assets/shareholders’ net worth – 0.80 Reserves and surplus/capital - 0.50
Draw up the balance sheet of the company.
19. Journalize the following transactions in the books of Mr. Ram Naresh:
October 1st, 2017 – Assets: Furniture Rs.5,000; Machinery Rs. 10,000; Stock Rs. 4,000; Cash in Hand Rs.550; Cash at Bank Rs.7,450; Amount due from Ramesh Rs.1,000; Amount due from Suresh Rs.2,000.
Liabilities: Amount due to Ram & Co. Rs.4,500; Amount due to Ranjeet &
Co. Rs.2,000; Amount due to Shama Rs.1,500.
Following are the transactions for the month of October 2017.
Date Transactions Amount
Rs.
Oct 1 Purchased goods from Ajay. 4,500
Oct 3 Sold goods for cash 1,500
Oct 5 Paid to Himanshu by Cheque. 5,500
Oct 10 Deposited in bank. 2,800
Oct 13 Sold goods on credit to Mukesh. 1,700
Page 4 of 7
Oct 15 Paid for Postage. 100
Oct 16 Received cash from Rakesh. 2,200
Oct 17 Paid telephone charges. 250
Oct 18 Cash sales. 1,500
Oct 20 Purchase of Govt. Securities. 5,000
Oct 22 Purchased goods worth Rs.16,000, less 20% trade discount and 5% cash discount from Malhotra &
Co., for cash and supplied them to Ramesh &Co., at list price less 10% trade discount.
Oct 25 Cash purchases 16,500
Oct 27 Goods worth Rs.500 were damaged in transit; a claim was made on the railway authorities for the same.
Oct 28 Suresh is declared insolvent and a dividend of 50 paisa in 1 rupee is received from him in full settlement.
20. The comparative Balance Sheets for X Ltd are given below:
Balance Sheet as at 31.12.2009
Particulars Note
No. 31.12.2009 31.12.2008
I. EQUITY AND LIABILITIES:
(1) Shareholders' Funds:
(a) Share Capital
1,90,000 90,000
(b) Reserves and Surplus 1
3,02,000 2,36,000 (2) Share Application Money
pending allotment
(3) Non-current Liabilities:
(a) Long-term borrowings
(Debentures)
1,02,000 1,02,000 ( b) Long-term provisions
(Premium on Redemption of
Debentures)
18,000 18,000
(4) Current Liabilities:
(a) Short-term borrowings
(b) Trade Payables (Creditors)
24,000 14,000
( c) Other current liabilities
( d) Short-term provisions
TOTAL
6,36,000
4,60,000
Page 5 of 7 II. ASSETS:
(1) Non-current assets:
(a) Fixed Assets:
(i) Tangible Assets 2
2,80,000 3,00,000 (ii) Intangible Assets
(Goodwill)
36,000 40,000
(b) Non-current Investments
(2) Current Assets:
(a) Current Investments
(b) Inventories
1,12,000
60,000
( c) Trade Receivables
(debtors)
1,04,000
24,000
( d) Cash and Cash
Equivalents (Cash)
82,000
22,000
(e) Short-term Loans and
Advances
(f) Other Current Assets
(Prepaid Expenses.)
22,000 14,000
TOTAL
6,36,000
4,60,000 Note: 1:
Reserves and Surplus 31.12.2009 31.12.2008
Share Premium
30,000 -
Reserves
2,72,000
2,36,000
3,02,000
2,36,000 Note: 2:
Tangible Assets 31.12.2009 31.12.2008
Plant and Machinery
3,80,000 3,60,000 Acc. Depreciation on Plant and
Machinery
- 1,00,000
- 60,000
2,80,000
3,00,000
Page 6 of 7 Additional information:
a. Dividend paid Rs.6,000
You are required to calculate Cash from operating, investing and financing activities.
21. Mr. A Commenced Business on 1st April, 2017 introducing the following initial capital:
Bank balance Rs. 8,000; Land Rs. 20,000; Building Rs. 11,200; Furniture Rs.
800; motor Van Rs. 2,400.
In addition to the above, the following balances have been extracted from his books:
Motor expenses – Rs.6,400 Sunder Debtors – Rs.7,888 Sales – Rs.3,88,000
Purchases – Rs.3,54,560 Salaries – Rs.8,304
Discount Received – Rs.6,416 Rates – Rs.1,104
Addition to building (as on 1/4/2017) – Rs.6,720 Repairs to buildings – Rs.944
Rent received – Rs.2,743 Light and fans – Rs.1,472 Telephone – Rs.816 Insurance – Rs.672
Balance at bank – Rs.16,000 Cash in hand – Rs.256
Sundry creditors – Rs.20,000
Addition to Motor Van (as on 1/4/2017) – Rs.4,160 Sundry expenses – Rs.3,863
Drawings – Rs.11,200
Income tax advance – Rs.800
Prepare trading and profit and loss account for the year ending 31st March, 2018.
a) Stock as on 31st March 2018 Rs. 54,000;
b) Depreciation: building 5% p.a, Furniture 6% p.a., Motor van 20% p.a.
d) Amount paid in advance for insurance Rs. 240 f) Write off further bad debts Rs. 888.
g) Make provision for doubtful debts @ 5%
SECTION - D
IV) Case Study – Compulsory question. (1x12=12) 22. a) From the following information extracted from the Balance Sheets of Star
Ltd. For four previous financial years, prepare Trend Analysis: (4 Marks)
Page 7 of 7 2014-15 2015-16 2016-17 2017-18 Current Assets:
Cash Bank Debtors Stock
Fixed assets:
Building
Plant and machinery Total
200 260 400 800 1,000 2,000 4,660
240 300 600 1,200 1,200 2,400 5,940
400 200 1,000 1,800 1,200 2,400 7000
220 240 1,600 2,000 1,200 2,800 8,060 b)The Balance sheet on the 1st day is as follows (as per US firm). You are a dealer in software (8 Marks)
Liabilities Amount Assets Amount
Cash
Inventory 25,00,000
5,00,000 Capital 30,00,000
On the second day computers (Hardware) purchased worth Rs. 10,00,000 for cash. On the third day plant and machinery purchased for cash Rs.
10,00,000. On the fourth day loan of Rs. 5,00,000 received from SBM. On the fifth day purchased stationery for Rs. 1,50,000 for cash. On the sixth day goods sold for cash Rs. 3,00,000 (cost Rs. 2,00,000).
Answer the following questions:
1. Profit earned during the first week is _____________.
2. If debit total is more than credit total of an account ,we enter the balance on credit side, therefore the balance is a ________ .
3. On the second the day the Journal entry for purchase of computer is _________.
4. If trial balance does not tally, we open __________ account.
5. Identify the 1st day transaction and pass the Journal entry: ________.
6. The balance sheet total on the asset side at the beginning of the 5th day is ___________.
7. We believe that the business will go on for a reasonable period of time. This assumption is called ________ concept.
8. The balance sheet total at the beginning of the 3rd day is _______.
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![Assets = Liabilities + Shareholders equity [2.1] Revenues Expenses = Income [2.2]](https://data01.123doks.com/thumbv2/123dok_us/002/404/2404973/cover.webp)
![Assets = Liabilities + Shareholders equity [2.1] Revenues Expenses = Income [2.2]](https://data01.123doks.com/thumbv2/123dok_us/002/404/2404974/cover.webp)
