SPECIMEN QUESTIONS WITH ANSWERS

1.7           SPECIMEN QUESTIONS WITH ANSWERS

Question 1 :

The following details were available from the books of Robin Singh in respect of Petty Cash Account for the year 2002-2003 :

		Rs.
Opening Balance		10.20
Total sums debited to Petty Cash Account		1,112.80
Postage	Rs.
	220.30
Stationery	334.65
Conveyance	167.30
Tea	90.35
Coolly and cartage	134.80
Miscellaneous expenses	125.60	1,073.00

Expenses have not been charged to the respective accounts.

Pass necessary entries at the time of finalisation and show the Petty Cash Account in the ledger.

Answer :

Particulars		Dr.(Rs).	Cr.(Rs.)
Sundries :
Postage A/c	Dr.	220.30
Stationery A/c	Dr.	334.65
Conveyance A/c	Dr.	167.30
Tea A/c	Dr.	90.35
Coolly & Cartage A/c	Dr.	134.80
Miscellaneous Expenses A/c	Dr.	125.60
To Petty Cash	Cr.		1,073.00

(Being petty expenses during the year as per Summary from Petty Book)

  

LEDGER

Dr.		Petty Cash Account			Cr.
	Particulars	Rs.		Particulars	Rs.
To	Balance b/d	10.20	By Postage		220.30
’’	Cash (Total)	1,112.80	’’	Stationery	334.65
			’’	Conveyance	167.30
			’’	Tea	90.35
			’’	Coolly & Cartage	134.80
			’’	Miscellaneous expenses	125.60
			’’	Balance	50.00
		1,123.00			1,123.00

Question 2 :

Samson furnishes you with his statement of affairs (in Rs.) as on 30th Nov., 2000 and 1999 :

	30.11.2000	30.11.1999
Assets owned :
Fixed assets : Cost	8,00,000	7,00,000
Less : Depreciation provision	3,50,000	3,00,000
	4,50,000	4,00,000
Inventory at cost	40,000	60,000
Customers dues	6,10,000	5,40,000
Bank	50,000	—
Less : Liabilities owned :	11,50,000	10,00,000
Creditors	2,00,000	3,00,000
Bank	—	75,000
Loan from Goliath	2,00,000	—
	4,00,000	3,75,000
Net worth	7,50,000	6,25,000

His revenue statement for the year ended 30th November, 2000 was as under :

	Rs.	Rs.	Rs.
Sales
39,00,000
Less :	Cost of Sales :
Opening stock		60,000
Purchases		34,90,000
Less : Closing stock		35,50,000	35,10,000
		40,000
Gross margin			3,90,000

  

Less : Expenses		1,00,000
Interest to :  Bank	16,000
Goliath	24,000	40,000	1,40,000
Cash profit			2,50,000
Less : Depreciation			50,000
Net profit			2,00,000

Samson asks you to show his ledger accounts for the year ended 30th November, 2000.

Answer :

Samson’s ledger for the year ended 30th November, 2000. (Figures in Rs.)

			Dr.	Cr.		Balance
	Fixed Assets
Dec 01, 1999	To	Balance b/d	7,00,000		Dr.	7,00,000
	To	Bank	*1,00,000		Dr.	8,00,000
Nov 30, 2000	By	Balance c/d		8,00,000
	Provision for depreciation		8,00,000	8,00,000
Dec 01, 1999	By	Balance b/d		3,00,000	Cr.	3,00,000
Nov. 30, 2000	By	Depreciation	*	50,000	Cr.	3,50,000
’’	To	Balance c/d	3,50,000
	Depreciation		3,50,000	3,50,000
Nov. 30, 2000	To	Provision for Deprn.	50,000		Dr.	50,000
’’	By	Profit & Loss A/c		50,000
	Inventory		50,000	50,000
Dec. 01, 1999			60,000		Dr.	60,000
	To	Balance b/d
	By	Trading A/c		60,000		Nil
Nov. 30, 2000	To	Trading A/c	40,000		Dr.	40,000
’’	By	Balance c/d	1,00,000	40,000		Nil
	Customers			1,00,000
Dec. 01, 1999	To	Balance b/d	5,40,000		Dr.	5,40,000
	To	Sales	39,00,000		Dr.	44,40,000
	By	Bank	*	38,30,000	Dr.	6,10,000
Nov. 30, 2000	By	Balance c/d		6,10,000
	Suppliers		44,40,000	44,40,000
Dec. 01, 1999	By	Balance c/d		3,00,000	Cr.	3,00,000
	By	Purchases		34,90,000	Cr.	37,90,000
	To	Bank	*35,90,000		Cr.	2,00,000
Nov. 30, 2000	To	Balance c/d	2,00,000
			37,90,000	37,90,000

	Goliath’s loan
	By	Bank	*	2,00,000	Cr.	2,00,000
Nov. 30, 2000	To	Balance c/d	2,00,000
	Sales A/c		2,00,000	2,00,000
	By	Customers		39,00,000	Cr.	39,00,000
Nov. 30, 2000	To	Trading A/c	39,00,000
	Purchases A/c		39,00,000	39,00,000
	To	Suppliers	34,90,000		Dr.	34,90,000
Nov. 30, 2000	To	Trading A/c		34,90,000
	Expenses A/c		34,90,000	34,90,000
	To	Bank	1,00,000		Dr.	1,00,000
Nov. 30, 2000	By	Profit & Loss A/c		1,00,000
	Interest A/c		1,00,000	1,00,000
	To	Bank - Bank	*16,000		Dr.	16,000
	To	Bank - Goliath	24,000		Dr.	40,000
Nov. 30, 2000	By	Profit & Loss A/c		40,000
	Capital A/c		40,000	40,000
Dec. 01, 1999	By	Balance b/d		6,25,000	Cr.	6,25,000
	By	Net Profit		2,00,000	Cr.	8,25,000
	To	Drawings - Bank	*75,000		Cr.	7,50,000
Nov. 30, 2000	To	Balance c/d	7,50,000
	Bank A/c		8,25,000	8,25,000
Dec. 01, 1999	By	Balance b/d		75,000	Cr.	75,000
	By	Fixed Assets		1,00,000	Cr.	1,75,000
	To	Customers	38,30,000		Dr.	36,55,000
	By	Suppliers		35,90,000	Dr.	65,000
	To	Goliath’s Loan A/c	2,00,000		Dr.	2,65,000
	By	Expenses		1,00,000	Dr.	1,65,000
	By	Interest - Bank		16,000	Dr.	1,49,000
	By	Interest - Goliath		24,000	Dr.	1,25,000
	By	Capital - Drawings		75,000	Dr.	50,000
Nov. 30, 2000	By	Balance c/d		50,000
	Trading A/c		40,30,000	40,30,000
	To	Opening stock	60,000		Dr.	60,000
	By	Closing stock		40,000	Dr.	20,000
	To	Purchases	34,90,000		Dr.	35,10,000
	By	Sales		39,00,000	Cr.	3,90,000
	To	P & L A/c – Gross Profit	3,90,000
			39,40,000	39,40,000

	Profit & Loss A/c			3,90,000	Cr.	3,90,000
	By	Trading A/c - Gross Profit
	To	Expenses	1,00,000		Cr.	2,90,000
	To	Interest to bank	16,000		Cr.	2,74,000
	To	Interest to Goliath	24,000		Cr.	2,50,000
	To	Depreciation	50,000		Cr.	2,00,000
		Capital A/c	2,00,000
			3,90,000	3,90,000

*  Balancing figures

1.8           SELF-EXAMINATION QUESTIONS

1.        State the nature and purpose of accounting.

2.        Indicate briefly the concepts and conventions in accounting.

3.        State the Golden Rules of Accounting with examples.

4.        What is a Journal ? Indicate the different types of Journals or Subsiduary Books.

5.        What is a Ledger ? Draw two alternative types of Ledgers.

5.        What is a Petty Cash Book ? State the advantages of Petty Cash Book.

6.        What is a Trial Balance ? What errors are not detected by Trial Balance ?

7.        From the following particulars prepare Journal, Ledger accounts and trial balance of ‘‘P’’ as on 30th June 2002 –

2002 June

1   Started business with cash Rs. 10,000.

7       Paid rent by cheque Rs. 550, purchased furniture Rs. 420, sold goods for cash Rs. 3,500.

15 Purchased goods on credit from A Rs. 6,000, Sold goods on credit Rs. 10,000. 21 Deposited cash into bank Rs. 500. Received from B Rs. 6,000 & paid to A Rs. 600. 23 Returned goods to A Rs. 500 and Returns from B Rs. 600.

27  Received bill from B Rs. 1,000 accepted bill of A Rs. 1,500.