XII Accounting

(Private)

Note: Attempt any Four questions.All questions carry equal mark.

1. Single Entry

Given

Mr.Waqar keeps his business record on single entry basis and uses a cash book only. A summary of his cash receipts and payments during the year ended March 31,2003 is as follows:

Receipts ……………………………… Payments
Capital………2,50,000 …………Furniture 60,000
Notes Payable..1,00,000 ……..Salaries Expense 30,000
Commission Income.1,60,000 .Rent Expense 20,000
……………………………………..Other Expense 10,000
……………………………………..Drawing 40,000
Adjustment data at year end:
i) Commission income Rs. 1,50,000.
ii) Accrued salaries Rs. 6,000.
iii) Prepaid rent Rs. 2,000.
iv) Depreciation on furniture Rs. 3,000.

Required
a) Prepare cash on hand on March 31.(5)
b) Prepare statement of profit and loss.(10)
c) Prepare statement of Affairs.(10)

2. Depreciation

a) Given:

On July 1,2002 Zaidi Company purchased a machine for cash at list price of Rs. 50,000 subject to a trade discount of 10%. On July 5,2002 the company paid Rs. 6,000 against fine insurance for the next two years, and Rs. 3,000 as installation charges of the machine. On Dec. 31,2002 its depreciation at Rs.4,000.

Required
i) Cost of machine.(4)
ii) Dated general journal entries from July 1, to Dec. 31,2002, including adjusting and closing entries.(9)
iii) Partial balance sheet on Dec. 31,2002, showing machine and its related allowance for depreciation.(4)

b) Given: A computer was purchased on June 30,2001 at a cost of Rs. 48,000. Its salvage value was estimated at Rs. 8,000 and useful life to be 4 years. Accounting period ends on Dec. 31, each year.

Required
Depreciation for 2001 and 2002 ,under:
i) Straight Line (4)
ii) Diminishing balance @ 50 percent(4)

3. Partnership-Profit/Loss Distribution

Given:

Akram and Ayaz partners with capital of Rs. 150,000 and Rs.250,000 respectively. Their partnership agreement provides that each partner be allowed 10% of his capital as markup, and the remaining profit/loss be divided equally.

Required
Profit/Loss Distribution Summary and general Journal entries for:
i) Net income of Rs. 4,000.(13)
ii) Net loss of Rs. 4,000.(12)

4. Partnership Admission

Given:

Asma and Sultana are partners with capitals of Rs. 2,00,000 and Rs. 3,00,00 respectively, sharing profit/loss equally. They decide to admit Khalida as a new partner for 1/5 interest in capital of the firm.

Required
General Journal entries in each of the following cases:
i) Khalida purchases share from Sultana for Rs. 110,000 paying cash.(6)
ii) Khalida invests in the firm sufficient cash.(6)
iii) Khalida invests in the firm Rs. 100,000 cash in total capital of Rs. 6,00,000.(6)
iv) Khalida invests in the firm Rs. 150,000 cash her capital account is to be credited with the same amount.(7)

OR

Partnership-Retirement

Given:

Balance sheet data of the partnership firm of Naila, Huma and Shahida on Dec.31,2002 were as follows:

Debit ……………………. Credit
Cash……………..10,000
Merchandise……….42,000…Allowance for Depreciation (Furniture) 12,000
Furniture…………30,000…Accounts Payable 20,000
…………………………Naila Capital 20,000
…………………………Huma Capital 20,000
…………………………Shahida Capital 10,000
On the above date Shahida withdrew from the partnership.Before her withdrewal merchandise and furniture were revalued at Rs. 32,000 and Rs. 13,000 respectively, and goodwill of the firm was recognized at Rs. 25,000.Then Shahida received a six-month 12% note of Rs.5,000,merchandise worth Rs. 5,000 and cash Rs. 2,000 in settlement of her account.The partners share profit/loss in their capital ratio.

Required
i) General Journal entries for the above.(18)
ii) Balance sheet after retirement of Shahida.(7)

5. Partnership-Dissolution

Given:

Balance sheet data of the partnership firm of Shamim and Fahim on March 31,2003 are as follows:
Assets: Cash Rs. 2,000; Merchandise Rs. 90,000; Land Rs.40,000; Goodwill Rs.18,000.
Equities: Accounts Payable Rs. 30,000; Shamim’s Capital Rs.40,000; Fahims Capital Rs.80,000.
On this date Shamim and Fahim decided to dissolve the partnership firm. They sold merchandise and land for Rs.36,000 and Rs.46,000 respectively and paid Rs.27,000 in full settlement of accounts payable. The partners share profit/loss in the ratio of their capital.

Required: Prepare
i) General Journal entries(20)
ii) Partners Capital accounts and cash accounts.(5)

6. Company-Issue of Shares

Given:

The following are transactions,completed by Abdul Sattar and Company.
i) Received applications for Rs. 50,000 ordinary shares of Rs. 10 each @ Rs. 12 per share.
ii) Allowed 40,000 ordinary shares of Rs. 10 each at a premium of Rs. 2 per share.
iii) Refunded application money on 10,000 ordinary shares @ Rs. 12 per share.
iv) Paid preliminary expenses Rs. 20,000.
v) Allowed 5,000 ordinary shares of Rs. 10 each against land costing Rs. 60,000.
vi) Allowed 5,000 ordinary shares of Rs. 10 each to the promoters of the company for their services.

Required
Prepare General Journal entries for the above transactions.(25)

7.a) Reserve and Fund

Given:

Rafat Limited had a debit balance of Rs. 35,000 in cash account and a credit balance of Rs. 50,000 in Retained Earnings account. It appropriated Rs.20,000 for debenture redemption, and set aside an equal amount of cash for this purpose.

Required: Prepare:
i) General Journal entries for the creation of reserve and fund.(8)
ii) Partial balance sheet,reporting the relevant data.(4)

7.b) Accounting for Non-Profitable Concern

Given:

The following is the Receipts and Payments account of Ajmeera Welfare Trust for 2002:

Receipts …………………………………………………. Payments
Opening Bank Balance…..16,500……Salaries Expense 26,000
Subscription Fees………..64,000……Repairs Expense 2,000
Rent Revenue…………….6,000……Utilities Expense 8,000
Other Revenue…………..11,000……Other Expense 21,000
……………………………………………Furniture 20,000
……………………………………………Closing Bank Balance 20,500
Adjusment data at December 31,are as follows:
i) Accrued subscription fees Rs. 3,000.
ii) Prepaid Salaries Rs. 2,000.
iii) Accrued Utilities Rs. 1,000.
iv) Dereciation of furniture Rs. 1,000.

Required
Income and Expenditure account.(13)