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Dibrugarh University Question Papers: Financial Accounting (Nov' 2017)

2017
COMMERCE
(General / Speciality)
Course: 103
(New course)
Financial Accounting
Full marks: 80
Pass marks: 24
Time: 3 hours
1.       (a) Write ‘True’ or ‘False’                                                                                                      1x4=4
a)      Sales – Gross Profit = Cost of goods sold
b)      There is no difference between Hire Purchase System and Instalment Purchase system.
c)       Under debtors system, Branch Account discloses profit or loss of the branch
d)      Royalty account is closed by transferring it to the Landlord’s account.
(b) Fill in the blanks:                                                                                                        1x4=4
a)   Accounting Standard Board was set up in India in the year __________.
b)   In hire purchase system, the buyer charges depreciation on the __________Price.
c)    Selling expenses should be divided among the different departments on the basis of _____________.
d)   Short working is the excess of_________ over actual royalty.

2.       Write short notes on (any four)                                                                                4x4=16
a)      The provisions of Accounting Standard-6
b)      Termination of hire purchase agreement
c)       Goods in transit
d)      Objectives of Departmental Accounts
e)      Minimum rent
f)       Independent branch
3. (a) Das Co. purchased two machines of Rs. 5,250 each from Bharat Machine Co. on 1st January, 2011 on hire purchase system. As per agreement, payment to be made Rs. 3,000 down and the balance in three equal annual instalments along with interest @ 55 per annum. Das co. writes off depreciation @ 10% per annum on written down value method. After having paid the first instalment, the buyer could not pay the second instalment and the seller took possession of one machine adjusting the value of other against the amount due taking the machine @ 20% depreciation on diminishing balance method. Seller, after spending Rs. 100 on repairs, sold it away for Rs. 4,000. Show the Ledger A/c in the books of both the parties. Books are closed on 31st December each year.                4+4+4+2=14
OR
(b) What is hire purchase system? Mention its chief features. Should depreciation on assets be provided for under hire purchase system? Discuss                                                            3+7+4=14

4. (a) What do you mean by accounting Standards? Mention the procedure for issuing Accounting Standards. Distinguish between Accounting Standards and   Accounting Principles                                          3+6+5=14
OR
(b) The following is the trial Balance of M/s Arun and Barun, a partnership firm, as on 31st march, 2017 and a Balance Sheet as on that date                                                  4+5+5=14
Trial balance
Dr. Balance
Rs.
Cr. balance
Rs.
Purchases
Advertisement
Wages
Bills Receivable
Printing and Stationery
Trade Expenses
Machinery
Sundry Debtors
Goodwill
Fuel
Opening Stock
Rent and Taxes
Land and Building
Interest on Loan
Cash in Hand
Depreciation on Machinery
Discount
Bad Debts
Furniture
2,50,000
11,000
1,50,000
10,000
5,000
13,000
72,000
78,000
85,000
24,000
90,000
19,000
1,65,000
8,000
32,000
8,000
4,000
3,000
20,000
Sales
Bills Payable
10% IDBI Loan(01.10.2016)
Sundry Creditors
Capital:
      Arun
      Barun
Commission

5,50,000
47,000
2,00,000
48,000

1,00,000
1,00,000
2,000

10,47,000

10,47,000
Necessary adjustment:
a)      Value of Closing Stock – Rs. 75,000
b)      Allow interest on capital of the partners @ 5% pa
c)       During the year, goods worth Rs. 10,000 has been destroyed by fire. But the insurance company agreed to a claim of Rs. 7,000 only.

5. (a) (i) Distinguish between Branch Accounts and Departmental Accounts                         5
(ii) How are the inter departmental transactions recorded in Departmental Accounts?   3
(iii) Explain the basis of allocation of common expenses over the various departments in Departmental Accounts. 6
OR
 (b) Dipali Electronics Ltd. Opened a branch at Dibrugarh on 1st April, 2016. From the following figures relating to Dibrugarh branch, prepare Dibrugarh Branch a/c and Goods Sent to Branch A/c for the year ended 31st March, 2017:

Rs.
Goods sent to branch
Cash sent to branch for:
            Rent
            Salaries
Cash Sales
Credit Sales
Cash collected from debtors
Stock(31.03.2017)
Petty cash (31.03.2017)
Goods returned by customers
Discount allowed to customers
42,000

1,800
4,000
15,000
29,000
23,000
5,200
120
1,700
1,300

6. (a) What is royalty? What are its different types? Why is minimum rent important in Royalty A/c? Distinguish between Rent and Royalty.                                                            2+3+4+5=14
OR


(b) Sri Amit Phukan took a colliery on lease from Sri Mohan Singh for a period of 20 years from 1st January, 2011 on a royalty of Rs. 16 per ton of coal raised with a minimum rent of Rs. 80,000 per annum and power to recoup short workings was first four years of the lease. The annual coal raised were:                      4+5+5=14
Year
Output(in tons)
2011
2012
2013
2014
2015
3000
3500
5000
9000
10000
From the above particulars, prepare the following in the books of Sri Amrit Phukan:
a)      Royalty A/c
b)      Short workings A/c
c)       Mohan Singh’s A/c

(Old course)
Full marks: 80
Pass marks: 32
1.       (a) Fill in the blanks:                                                                                        1x4=4
a)      Revenue is generally recognized at the point of _________________.
b)      In hire purchase system, the buyer charges depreciation on_________ price.
c)       Royalty paid on sales is debited to_______________ Account.
d)      After making payment to third parties, the __________ due to a partner is paid.
(b) Write True and False:                                              1x4=4
a)      Accounting Standard Board was set up in India in the year 1977.
b)      The buyer has no option to return the goods in case of hire purchase
c)       Branch Stock A/c is always prepared at cost price.
d)      When a partner is not able to meet his liabilities, he is said to be insolvent.
2. Write short notes on (any four):                           4x4=16
a)      IFR Standards
b)      Features of Instalment Purchase System
c)       Sub lease
d)      Independent Branch
e)      Realization Account
3. (a) The following is the Trial Balance of Mr. Arup Baruah’s business as on 31st march 2017
Trial Balance
Dr. balance
Rs.
Cr. balance
Rs.
Opening stock
Purchases
Bills Receivable
Cash in Hand
Bad Debts
Machinery
Advertisement
Sundry Debtors
Goodwill
Land and Building
Fuel
Wages and Salaries
Rent and Taxes
Discount
Interest
Furniture
1,60,000
4,00,000
4,000
26,000
2,000
1,32,000
16,000
1,00,000
1,40,000
4,50,000
30,000
80,000
40,000
17,200
20,000
30,000
Sundry creditors
Bank Loan
Sales
Bills Payable
Commission
Capital
1,50,000
87,200
8,40,000
40,000
10,000
5,20,000



16,47,200
From the following additional information, you are required to prepare a Trading and Profit & Loss A/c for the year ended 31st March, 2017 and a Balance Sheet as on that date:                                     3+4+5=12
a)   Closing Stock as on 31st March 2017 Rs. 1,20,000.
b)   Depreciation machinery by 10% and furniture by 5%
c)    Create a reserve of 5% on sundry debtors for doubtful debts
d)   Write off ¼ th of the advertisement
OR
(b) What are Accounting Standards? State the objectives and scope of Accounting Standards.    3+4+5=12
4. (a) Distinguish between Hire purchase system of sales and Ordinary Credit sales. Mention any three rights of hire vendor and three rights of hire purchaser as laid down in the Hire purchase act,1972.     5+3+3=11
OR
(b) Domdom store purchased a generator from M/s Bimal Brothers on instalment purchase system. Rs. 12,000 was payable on delivery on 1st April, 2012 and the balance in four annual instalments of Rs. 12,000 each on 31st March every year. The seller charges 5% interest per annum on the yearly balance. The cash price of the generator on the date of delivery was Rs. 54,551. Depreciation @ 10% per annum on diminishing balance was written off each year. From the above particulars, prepare the following Ledger Accounts in the books of Domdom Store: 4+4+3=11
a)      Generator’s a/c
b)      M/s Bimal brothers A/c
c)       Interest Suspense A/c
5. (a) What do you mean by Branch Accounting? Discuss the Objects and advantages of Branch Accounting. 3+4+4=11
OR
(b) Luit Ltd. Has a branch at Duliajan which sells goods at cost plus 25%. From the following particulars, calculate the value of closing stock and prepare Duliajan Branch A/c for the year ended 31st March 2017:           3+8=11

Rs.
Stock at branch on 01.04.2016
Goods sent to branch
Cash Sales at branch
Expenses paid by Head Office:
         Salaries                                                                              5,000
         Advertisement                                                                 2,000
22,000
1,78,000
2,00,000


7,000
A commission of 10% on the net profit after charging such commission is to be created to Branch Manager.
6. (a) A took a lease of a colliery with a minimum rent of Rs. 30,000 per annum merging into a royalty of Rs. 5 per ton of coal raised with a right to recoup short workings within the first four years of lease. The output for first five years was given below:
Year
Output (in tons)
1st
2nd
3rd
4th
5th
Nil
3000
5000
7000
8000
Prepare necessary Ledger A/c in the books of the lessee.                                                             11
OR
(b) What is royalty? State its different types. How does royalty differ from rent?               3+3+5=11
7. (a) What do you mean by dissolution of a partnership firm? How and under what circumstances a partnership firm may be dissolved? Discuss                     3+8=11
OR
(b) X and Y are two sole traders. They desire to amalgamate their business and form a new form. The Balance Sheets of their business as on 31st March,2017 were as follows:
Balance Sheet of X as on 31st March, 2017
Liabilities
Rs.
Assets
Rs.
Sundry creditors
Capital
Profit & Loss a/c
50,000
2,00,000
30,000
Furniture
Stock
Cash
1,10,000
1,20,000
50,000

2,80,000

2,80,000
Balance Sheet of Y as on 31st March, 2017
Liabilities
Rs.
Assets
Rs.
Sundry creditors
Capital

1,10,000
2,60,000
Furniture
Stock
Cash
Profit & Loss A/c
1,60,000
1,80,000
6,000
24,000

3,70,000

3,70,000
You are required to:
a)      Close the books of X;
b)      Close the books of y;
c)       Draw up the Balance Sheet of the new firm                                 4+4+3=11

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