Thursday, November 07, 2019

Dibrugarh University Question Papers: Advanced Financial Accounting (Nov' 2018)


2018 (November)
COMMERCE (Speciality)
Course: 301 (Advanced Financial Accounting)
The figures in the margin indicate full marks for the questions
(NEW COURSE)
Full Marks: 80
Pass Marks: 24
Time: 3 hours
1. (a) Fill in the blanks:                                              1x4=4
1)         A Non Performing asset is an asset that ceases to generate income for the bank.
2)         Consideration for annuities granted is a source of income for a life insurance company.
3)         In case of marine insurance, the provision against unexpired risk is maintained at 100 % of net premium.
4)         Investments are freely bought and sold in the stock exchange through banks and brokers.
(b) Write True or False:                                             1x4=4

1)         Rebate on bills discounted for a banking company is an income.      False, advance income
2)         Balance Sheet of a life insurance business is prepared in the prescribed from A-BS of the Insurance Act.  True
3)         Revenue Account of a general insurance company has five Schedules.         False, 4
4)         Brokerage is added in the cost of investment in the books of purchaser of investment.        True
2. Write short notes on any four of the following:                              4x4=16
a)         Money at Call and Short Notice.
b)         Double Insurance.
c)          Fire Insurance Revenue Account.
d)         Cub-dividend and EX-dividend.
e)         Columnar Investment Accounts.
3. (a) What is bank accounting? What are the main features of bank’s accounting system? Point out the main advantages and disadvantages of slip system of posting in Bank Accounts.     2+6+3+3=14
Or
(b) The following are the figures extracted from the books of XYZ Bank Ltd. as on 31st March, 2018: 14

Rs.
Interest and Discount received
Interest paid on Deposits
Issued and Subscribed Capital
Reserve under Section 17
Commission, Exchange and Brokerage
Rent Received
Profit on Sale of Investment
Salaries and Allowances
Director’s Fees and Allowances
Rent and Taxes paid
Stationery and Printing
Postage, Telephone and Internet Charges
Audit Fees
Depreciation on Bank’s Properties
Other Expenses
20,30,000
12,02,000
5,00,000
3,50,000
90,000
30,000
95,000
1,05,000
12,000
54,000
12,000
25,000
4,000
12,500
12,000
Other Information:
1)         A customer to whom a sum of Rs. 2,50,000 has been advanced, has become insolvent and it is expected that 40% of the sum can be recovered from his estate. Interest due at 15% on his debt has not been provided in the books.
2)         Provision for bad and doubtful debts on other debts necessary Rs. 50,000.
3)         Provide Rs. 3,50,000 for Income-tax.
4)         The directors desire to declare 10% dividend.
Make the necessary assumptions and prepare the Profit and Loss Account of XYZ Bank Ltd. in accordance with law.
4. (a) (1) Draw a proforma of Revenue Account of life insurance company with imaginary figures. 10
(2) How is bonus is reduction of premium treated in the Revenue Account?
Or
(b) The Young India Life Assurance Co. Ltd. had a paid-up share capital of Rs. 25,00,000 dividend into 25,000 equity shares of Rs. 100 each. Its net liability on all contracts in force as on 31st March, 2018 was Rs. 2,25,00,000 and on 31st March, 2017, this liability was Rs. 2,00,00,000. From the following figures, extracted from the books of the company for the year ended 31st March, 2018, prepare Revenue Account. The company has paid an interim bonus of Rs. 11,00,000 and 20% of the surplus is to be allocated to shareholders, 10% to catastrophe reserve and the balance being carried forward:                                                                        14

Rs.
Life fund as on 1st April, 2017
Premium less re-insurance
Interest, dividend and rent
Fines and fees
Income-tax
Management expenses
Annuities paid
Commission
Surrenders
Bad debts
Claims less re-insurance claims
Consideration for annuities granted
2,45,00,000
1,38,00,000
75,00,000
40,000
11,80,000
17,50,000
1,00,000
5,40,000
8,50,000
10,000
89,00,000
4,90,000
5. (a) Point out the main features of accounts of general insurance companies. What statutory books are required to be maintained by a general insurance company under the Insurance Act?   6+8=14
Or
(b) From the following particulars, you are required to prepare Fire Revenue Account for the year ended 31st March, 2018:                 14

Rs.
Reserve for unexpired risk as on 1st April, 2017
Additional reserve as on 1st April, 2017
Claims paid
Management expenses
Insurance Premium
Interest and dividends
Income-tax on interest and dividends
Re-insurance premium
Profit on sale of investments
Legal charges regarding claims
Re-insurance claims recoveries
Commission on direct business
Commission on re-insurance ceded
Commission on re-insurance accepted
Outstanding claims:
On 31st March, 2018
On 31st March, 2017
52,000
12,000
65,000
28,250
1,14,000
6,400
800
7,000
1,600
400
2,800
11,200
600
400

7,000
9,000
The company calculates the Reserve for unexpired risks @ 50% of the net premium each year and increase additional reserve by 5% of net premium annually.
6. (a) What is Investment Account? Explain about the nature and purposes of an Investment Account. How are Investment Accounts prepared when there is issue of bonus shares and right shares by the company?          2+3+3+6=14
Or
(b) Mr. Investor furnishes the following details relating to his holding in 6% Government Bonds of Rs. 100 each:
Opening balance face value Rs. 60,000 (cost Rs. 59,000)
1.3.2017 100 units purchased ex-interest at Rs. 98.
1.7.2017 Sold 200 units ex-interest of the original holding at Rs. 100.
1.10.2017 Purchased 50 units at Rs. 98 cum-interest.
1.11.2017 Sold 200 units ex-interest at Rs. 99 out of the original holdings.
Interest dates are 30th September and 31st March. Mr. Investor closes his books every 31st December. Show the Investment Account as it would appear in his books.       14
 (OLD COURSE)
Full Marks: 80
Pass Marks: 32
Time: 3 hours
The figures in the margin indicate full marks for the questions
1. (a) Fill in the blanks:                                                                    1x4=4
1)         Banks in India are under the general supervision of the RBI.
2)         In the contract of insurance, there are two parties namely the insurer and the insured.
3)         All properties of the insolvent, both movable and immovable are shown under ___ of Statement of Affairs.
4)         Changes in the price level are not taken into account in the preparation of _______ Accounts.
(b) Write True or False:                                       1x4=4
1)         Rebate on bills discounted for a banking company is an income.      False, advance income
2)         General insurance includes all types of insurance. false
3)         The insolvency proceedings begin with an insolvency petition field in a proper court of law.
4)         In an Investment Account, cum-interest means including accrued interest on an investment.  True
2. Write short notes on any four of the following:                             4x4=16
a)         Slip System of Posting.
b)         Bonus in Reduction of Premium.
c)          Statement of Affairs.
d)         Cum-dividend and Ex-dividend.
e)         General Price Level Accounting.
3. (a) From the following particulars, prepare Profit and Loss Account of Safety Bank Ltd. for the year ended on 31st March, 2018:                                                                     12

Rs. (‘000)
Interest on Deposits
Commission (Cr.)
Interest on Loans
Sundry Charges (Dr.)
Rent and Taxes
Payment to Employees
Discount on Bills Discounted
Interest on Overdrafts
Interest on Cash-credit
Auditor’s fees
Director’s fees
Bad debts to be written off
3,200
100
2,490
100
200
500
1,490
1,600
2,320
30
20
130
Or
(b) Give a proforma of Balance Sheet of a banking company, showing imaginary figures.                                               12
4. (a) What is general insurance? How does it differ from life insurance? Explain ‘Reserve for Unexpired Risk’ in case of general insurance.                                           2+4+5=11
Or
(b) From the following particular, prepare a Fire Revenue A/c of Tinsukia Fire Insurance Company for the year ended on 31st March, 2018:                                              11

Rs.
Reserve for unexpired risk on 1st April, 2017
Additional Reserve as on 1st April, 2017
Claims paid
Re-insurance claim
Management expenses
Premium
Re-insurance premium
Commission on direct business
Commission on re-insurance ceded
Commission on re-insurance accepted
Legal charges regarding claim
Survey expenses
Profit on sale of investments
Interest and Dividend
Income-tax thereon
Contribution to fire brigade
Outstanding claims
1,40,000
30,000
80,000
10,000
20,000
2,00,000
12,000
20,000
2,000
1,000
2,000
1,000
1,000
20,000
2,000
1,000
5,000
The company calculates its reserve for unexpired risks at 50% of the net premium each year and maintain additional reserve same as in the last year.
5. (a) (1) Mention the various lists that have to be prepared in support of the Statement of Affairs, prepared under the Indian Insolvency Act, giving short particulars as to the contents of each of them.                                             6
(2) Distinguish between a Statement of Affairs and a Balance Sheet.                                                           5
Or
(b) From the following information prepare a Statement of Affairs of Mr. Dukhi Ram who is declared insolvent on 31st March, 2018:                                                                      11

Rs.
Cash in hand
Debtors:
Good                                                                                             12,500
Doubtful (expected to realize Rs. 2,000)                                  6,000
Bad                                                                                                10,000
Shares in X Ltd.
Bills receivable (Good)
Other securities (Rs. 30,000 pledged with partly secured creditors and the balance with fully secured creditors)
Drawings
Trade expenses
Creditors (unsecured)
Creditors (partly secured)
Creditors (fully secured)
Preferential claims
2,500



28,500
50,000
42,500

2,80,000
1,74,000
74,000
2,50,000
1,70,000
2,37,000
7,500
6. (a) (1) Discuss about the nature and purposes of an Investment Account.                                        3+4=7
(2) Distinguish between Cum-interest and Ex-interest.                                                  4
Or
(b) On 1.1.2017, 6% 200 debentures of Rs. 100 each in Y Ltd. were held as investments by X Ltd. at a cost of Rs. 18,200. Interest is payable on 31st December. On 1.4.2017, Rs. 4,000 of such debentures were purchased by X Ltd. @ Rs. 98 cum-interest and on 1.9.2017, Rs. 6,000 debentures were sold @ Rs. 96 ex-interest. On 1.12.2017, Rs. 8,000 debentures were sold @ Rs. 99 cum-interest. On 31.12.2017, X Ltd. sold Rs. 10,000 debentures @ Rs. 95 ex-interest. Prepare Investment Account for 6% Debentures in Y Ltd. in the books of X Ltd. Ignore income-tax (apply FIFO method). 11
7. (a) What is Inflation Accounting? What are its objectives? Discuss in brief the CPP method of Inflation Accounting. 2+4+5=11
Or
(b) The Balance Sheet of PK Ltd. revealed the following among other things:

31.3.2016 (Rs.)
31.3.2017 (Rs.)
Investments
Book Debts
Cash at Bank
Advances for supply of Materials
Due to Suppliers
5,50,000
4,50,000
60,000
1,00,000
2,50,000
6,10,000
5,50,000
80,000
1,26,500
3,22,000
During 2016 – 17, material prices rose by 15% and those of finished goods by 10%. Calculate the Monetary Working Capital Adjustment to be made under Current Cost Accounting System.                              11

No comments:

Post a Comment

Kindly give your valuable feedback to improve this website.

Popular Posts for the Day