Exemplar Classes

Time : 3 Hours Maximum Marks : 60

Class : 12 (CBSE Accountancy part 1) || Test - 02
General Instructions :
1. All questions are compulsory.
2. The question paper consist of 15 questions divided in to four sections A, B,
C,D and E. Section - A comprises of 3 questions of 1 mark each, Section -
B comprises of 3 questions of 3 marks each, Section - C comprises of 5
questions of 4 marks each, Section D comprises of 2 questions of 6 marks
Exemplar Classes , Test conducted by Gunjan Thakur for CBSE Board 2018

each and Section E comprises of 2 questions of 8 marks each

3. Use of calculation is not permitted.
4. An additional 15 minutes time gas been allotted to read this question paper
only.
SECTION A

1. What advantage does a firm perceive in having a partnership deed?

2. State any two items of deduction that may have to be made from the
amount payable to a retiring partner.

3. Firm had an unrecorded asset which was valued at Rs 5000. This was
accepted by creditors of Rs 7000, in full settlement of their claims.

SECTION B
4. Mannu and Shristhi are partners in a firm sharing profit in the ratio of 3:2.
Following in the balance sheet of the firm as on March 31st, 2006.
BALANCE SHEET as at 31st March, 2006
Liability Amt (Rs) Asset Amt (Rs)
Capital a/cs: Drawing:
Mannu 30,000 Mannu 4,000
Shristhi 10,000 40,000 Shristhi 2,000 6,000
Other asset 34,000
40,000 40,000

Profit for the year ended march 31st, 2006 was Rs 5,000 which was divided in the
agreed ratio but interest @ 5% p.a. on capital and @ 6 % p.a. on drawing was
inadvertently omitted. Adjust interest on drawing on an average basis for 6 months.
Give the adjustment entry.

5. Pass the necessary journal entries for the following transactions on the dissolution
on the firm of Sudha and Shiva after the various assets (other than cash) and
outside liabilities have been transferred to Realisation Account:
i. Sudha agreed to pay off her husbands loan Rs 19,000.
ii. A debtor whose debt of Rs 9,300 was written off as bad in the books paid Rs
7,500 in the full settlement.
iii. Shiva took over all investments at 13,300.
iv. Sundry creditors Rs 10,000 was paid at 9% discount.
v. Realisation expenses Rs 3,400 were paid by Sudha for which she was allowed
Rs 3,000.
Loss on realisation Rs 9,400 was divided between Sudha and Shiva in 3:2 ratios.

6. A, B, C and D are partners sharing profit in the ratio of 3:3:2:2 respectively. D

 retiring and A, B and C decided to share the future profit in the ratio 3:2:1.
Goodwill of the firm is valued at Rs 6,00,000. Goodwill already appears in the books
at 4,50,000. The profit for the first year after Ds retirement amount to Rs 1,20,000.
Give the necessary Journal entries to record Goodwill and to distribute the profits.
Show your calculations clearly.

SECTION C
7. Ram and Shyam are partners in a firm sharing profits in the ratio 3:1. Their balance
sheet as at 31st March 2006 was as follows:
Liability Amt (Rs) Asset Amt (Rs)
Creditor 2,800 Cash at Bank 2,000
Workman compensation fund 1,200 Debtors 6,500
General reservation 2,000 Less: Provision for 500 6,000
doubtful debts
Capital A/cs: Stocks 3,000
Ram 6,000 Investment 5,000
Shyam 4,000 10,000
16,000 16,000

They decided to admit Mohan as partner in the firm in 1st April, 2006 for 1/5th share
on the following terms:
a) Mohan shall bring in Rs 6,000 as his share of premium.
b) That unaccounted accrued income of Rs 100 be provided for.
c) The market value for investment was Rs 4,500.
d) A debtor whose due of Rs 500 was written off as bad debts paid Rs 400 in full
settlement.
e) A claim of Rs 200 on account of workmen compensation to be provided for.
f) Mohan to bring to Rs 5,000 as his share of capital.
Prepare revaluation A/c, partners capital account and the balance sheet of the firm
to give effect to the above arrangements.
8. Ram and Shyam are partners sharing profits and losses in the ratio 3:1. They agreed
to admit their manager, Hari as a partner with effect from 1st January, 2014 for 1/4th
share in of profit. Hari has deposited Rs 30,000 as security. He was getting a salary
of Rs 24,000 per annum and a commission of 10% on the net profit after charging
his salary and commission. As per partnership deed, the security deposited by Hari
is to be treated as his shares of capital. Any excess amount which Hari will get as a
partner over the receipt as a manager would be borne by Ram and Shyam in the
ratio of 3:2. Profit for the year 2014 was Rs 2,00,000 before payment of salary and
commission to Hari. Prepare profit and loss appropriation account of the firm
during 2014.
9. A, B and C were partners in a firm sharing profits in the ratio 2:2:1. Their balance
sheet as at March 31, 2016 was as follows :
Liability Amt (Rs) Asset Amt (Rs)
Creditor 30,000 Land 85,000
Bills payable 20,000 Building 50,000
Outstanding 25,000 Plant 1,00,000
expenses
General reserve 50,000 Stock 40,000
Capital : Debtors 25,000
A 50,000 Cash 5,000
B 60,000
C 70,000 1,80,000
3,05,000 3,05,000
 From April 1, 2016 the partners decided to share profits in the ratio of 1:2:3. For this
purpose it was agreed that :
i. The goodwill of the firm should be valued at Rs 60,000.
ii. Land should be revalued at Rs 1,00,000. Building should be depreciated by
6%.
iii. Creditors amounting to Rs3,000 were not to be paid.
You are required to :
i. Record the necessary journal entries to give effect to the above agreement.
ii. Prepare capital accounts of the partners.
iii. Prepare the balance sheet of the reconstituted firm.
Partners decided that General Reserve will be transferred to capital accounts
whereas revised values of assets and liabilities are not to be recorded in the books.
10. X, Y and Z were partners in a firm sharing profits as in the ratio of 5: 3: 2. On 31-03-
2015 their balance sheet was as follows:
Liabilities Rs Asset Rs
Creditors 21,000 Land and building 62,000
Investment fluctuation fund 10,000 Motor vans 20,000
Profit and loss account 40,000 Investments 19,000
Capitals: Machinery 12,000
X 50,000 Stocks 15,000
Y 40,000 Debtors 40,000
Z 20,000 1,00,000 Less: Provision 3,000 37,000
Cash 16,000
1,81,000 1,81,000

On the above date, Y retired and X and Z agreed to continue the business on the
following terms:
i. Goodwill of the firm was valued at Rs 51,000.
ii. There was a claim of Rs 4,000 for workmens compensation.
iii. Provision for bad debts was to be reduced by Rs 1,000.
iv. Y will be paid Rs 8,200 in cash and the balance will be transferred in his loan
account which will be paid in four equal yearly instalments together with
interest @ 10% p.a.
v. The new profit sharing ratio between X and Z will be 3:2 and their capitals
will be in their new profit sharing ratio. The capital adjustment will be done
by opening current accounts.
Prepare revaluation account, partners capital accounts and the balance sheet of the
reconstituted firm.
11 Parul, Payal and Priyanka are partners. They decided to dissolve their firm. Pass
necessary journal entries for the following after various assets (other than cash and
bank) and the third party liabilities have been transferred to realisation account :
a) There were total debtors of Rs 76,000. A provision of bad and doubtful debts
Exemplar Classes

also stood in the books at 6,000. Rs 12,000 debtors proved bad and rest paid
the amount due.
b) Parul agreed to pay off her husbands loan of Rs 7,000 at the discount of 5%.
c) A machine which was not recorded in the books was taken over by Payal at
Rs 3,000, whereas its expected value was Rs 5,000.
d) A contingent liability (not provided for) of Rs 4,000 was also discharged.
e) Priyanka paid the realisation expenses of Rs 15,000 out of her pocket and she
was to get a fixed remuneration of Rs 18,000 for completing the dissolution
process.
 SECTION D
12. A and B are in partnership sharing profits and losses in ratio of 3:2. They decided to
admit C, their manager, as a partner with effect from 1st April, 2016, giving one-
fourth share of profits.
C, while a manager, was in receipt of salary of Rs 27,000 per annum and a
commission of 10% of the net profits after charging such salary and commission.
In term of the partnership deed, any excess amount which C will be entitled to
receive as a partner over the amount which would have been due to him if he
continued to be the manager would have to be personally borne by A out of this
share of profit. Profit for the year ended 31st March, 2017, amounted to Rs 2,25,000,
before payment of salary and commission.
You are required to show the profit and loss appropriation account for the year
ended 31st March, 2017.
13. Arnab, Ragini and Dhrupad were partners sharing profits in the ratio of 3: 1:1. On
31st March, 2015, they decided to dissolve their firm. On that date their Balance
Sheet was as under :
Liabilities Rs Asset Rs
Creditors 60,000 Bank 50,000
Arnabs brothers loan 95,000 Debtors 1,70,000
Dhrupads Loan 1,00,000 Less: provision
for Bad debt 20,000 1,50,000
Investment fluctuation fund 50,000 Stock 1,50,000
Capitals: Investments 2,50,000
Arnab 2,75,000 Building 3,00,000
Ragini 2,00,000 Profit and loss
account 50,000
Dhrupad 1,70,000 6,45,000

9,50,000 9,50,000
The asset were realised and the liabilities were paid as under :
i. Arnab agreed to pay his brothers loan.
ii. Investment realised 20% less.
iii. Creditors were paid at 10% less.
iv. Building was auctioned for Rs 3,55,000. Commission on auction was Rs
5,000.
v. 50% of the stocks was taken over by Ragini at market price which was 20%
less than the book value and the remaining was sold at market price.
vi. Dissolution expenses were Rs 8000. Rs 3000 were to be borne by the firm and
the balance by Dhrupad. The expenses were paid by him.
Prepare realisation account, Bank account and partners capital accounts.
SECTION E
14. Ramesh, Naresh and Sudesh were partners in a firm sharing profits in the ratio of
2:2:1. On 31st December, 2008, their balance sheet was as follows:
Liabilities Rs Asset Rs
Creditors 60,000 Bank 90,000
Bills payable 40,000 Stock 70,000
General reserve 30,000 Debtors 40,000
Capital A/cs: Land and buildings 5,00,000
Ramesh 3,00,000 Profit and loss account 1,60,000
Naresh 3,00,000
Sudesh 1,30,000 7,30,000

8,60,000 8,60,000
 Naresh died on 31st March, 2009. The partnership deed provided for the following
on the death of a partner:
i. Goodwill of the firm was to be valued at 2 years purchase of the average
profit last 5 years. The profit the year ended 31st December, 2007, 31st
December, 2006, 31st December, 2005 and 31st December, 2004 were Rs
50,000; Rs 80,000; Rs 1,10,000 and Rs 2,20,000 respectively.
ii. Nareshs share of the profit or loss till the date of his death was to be
calculated on the basis of the profit or loss for the year ended 31 st
December, 2008.
You are required to calculate the following:
a) Goodwill of the firm an Nareshs share of goodwill at the time of his death.
b) Nareshs share in the profit or loss of the firm till the date of his deatch.
c) Prepare Nareshs capital account at the time his death to be presented to his
executors.
15. On 31 March, 2010 the Balance sheet of W and R who shared profits in 3:2 ratio
st

was as follows:
Liabilities Rs Asset Rs
Creditors 20,000 Cash 5,000
Profit and loss account 15,000 Sundry debtors 20,000
Capital Accounts Less: provision 7,00 19,300
Stock 25,000
Capitals: Plants and machinery 35,000
W 40,000 Plants 20,700
R 30,000
1,05,000 1,05,000

On 1st April, 2010 B was admitted as a partner on the following conditions:

a) B will get 4/15th share of the profits
b) B had to bring Rs 30,000 as his capital to which amount other partners
capitals shall have to be adjusted.
c) He would pay for his share of goodwill which would be based on years
purchase of average profits of past 4 years.
d) The asset would be revalued as under:
Sundry debtors at book value less 5% provision for bad debts. Stocks at Rs
20,000, plant and machinery at 40,000.
e) The profit for the firm for the years 2007, 2008 and 2009 were Rs 20,000; Rs
14,000 and Rs 17,000 respectively.
Prepare revaluation accounts, partners capital accounts and the balance sheet of
the new firm.

Exemplar Classes , Test conducted by Gunjan Thakur for CBSE Board 2018