2551 + Interview Questions in Accountancy Page 46 InterviewSolution

2251.	Q11. Consider the following statements about E Sahyog: 1. It is a Project of the Income-Tax Department to Facilitate Taxpayers which reduces the need for the taxpayer to physically appear before tax authorities. 2. It is aimed at reducing compliance cost, especially for small taxpayers. Which of the above statements are correct?
Answer» Q11. Consider the following statements about E Sahyog: 1. It is a Project of the Income-Tax Department to Facilitate Taxpayers which reduces the need for the taxpayer to physically appear before tax authorities. 2. It is aimed at reducing compliance cost, especially for small taxpayers. Which of the above statements are correct?

2251.

Q11. Consider the following statements about E Sahyog: 1. It is a Project of the Income-Tax Department to Facilitate Taxpayers which reduces the need for the taxpayer to physically appear before tax authorities. 2. It is aimed at reducing compliance cost, especially for small taxpayers. Which of the above statements are correct?

Answer»

Q11. Consider the following statements about E Sahyog:

1. It is a Project of the Income-Tax Department to Facilitate Taxpayers which reduces the need for the taxpayer to physically appear before tax authorities.

2. It is aimed at reducing compliance cost, especially for small taxpayers.

Which of the above statements are correct?

Discussion

2252.	The standard format of journal does not include which of the following?
Answer» The standard format of journal does not include which of the following?

Discussion

2253.	A firm purchased on 1st January, 2013 a second-hand machinery for Rs.36,000 and spent Rs.4,000 on its installation. On 1st July in the same year, another machinery costing Rs.20,000 was purchased. On 1st July, 2015 machinery brought on 1st January, 2013 was sold for Rs. 12,000 and a new machine purchased for Rs. 64,000 on the same date. Depreciation is provided annually on 31st December 10 % per annum on the written down value method. Show the machinery account from 2013 to 2015.
Answer» A firm purchased on 1st January, 2013 a second-hand machinery for Rs.36,000 and spent Rs.4,000 on its installation. On 1st July in the same year, another machinery costing Rs.20,000 was purchased. On 1st July, 2015 machinery brought on 1st January, 2013 was sold for Rs. 12,000 and a new machine purchased for Rs. 64,000 on the same date. Depreciation is provided annually on 31st December 10 % per annum on the written down value method. Show the machinery account from 2013 to 2015.

Discussion

2254.	Which basis of accounting gives a correct picture of operating results and financial position of a firm?
Answer» Which basis of accounting gives a correct picture of operating results and financial position of a firm?

Discussion

2255.	Non-economic events are not recorded in the books of account. This is according to which concept?
Answer» Non-economic events are not recorded in the books of account. This is according to which concept?

Discussion

2256.	While making the provision for tax in the books, which account is debited?
Answer» While making the provision for tax in the books, which account is debited?

Discussion

2257.	The preparation of adjusting entries is an application of the ___ concept of accounting.
Answer» The preparation of adjusting entries is an application of the ___ concept of accounting.

Discussion

2258.	Original cost of machine is Rs. 4,00,000 with a scrap value of Rs. 25,000 after 4 years. Calculate rate of Depreciation.
Answer» Original cost of machine is Rs. 4,00,000 with a scrap value of Rs. 25,000 after 4 years. Calculate rate of Depreciation.

Discussion

2259.	The Historical cost or cost principle is not applicable to which of the following assets:
Answer» The Historical cost or cost principle is not applicable to which of the following assets:

Discussion

2260.	State when cash book balance is lower than pass book balance.
Answer» State when cash book balance is lower than pass book balance.

Discussion

2261.	Prepare accounting equation from the following (i) Started business with cash Rs. 1,00,000 and machinery Rs. 80,000. (ii) Purchased goods for cash Rs. 20,000 and on credit Rs. 30,000. (iii) Sold goods for cash costing Rs. 10,000 and on credit costing Rs. 15,000 both at a profit of 20% (iv) Cash withdrawn for personal use Rs. 10,000. (v) Accrud interest Rs. 2,000. (vi) Rent received in advance Rs. 1,000. (vii) Interest on capital 10% (only on cash introduced as capital). (viii) Interest on drawings charged 5% (Total drawings till now is Rs. 10,000). (ix) Depreciation on machinery provided 10%. (x) Rent paid in cash Rs. 1,000 and rent outstanding Rs. 500. (xi) Prepaid insurance Rs. 1,000. (xii) Bad debts written off Rs. 1,000.
Answer» Prepare accounting equation from the following (i) Started business with cash Rs. 1,00,000 and machinery Rs. 80,000. (ii) Purchased goods for cash Rs. 20,000 and on credit Rs. 30,000. (iii) Sold goods for cash costing Rs. 10,000 and on credit costing Rs. 15,000 both at a profit of 20% (iv) Cash withdrawn for personal use Rs. 10,000. (v) Accrud interest Rs. 2,000. (vi) Rent received in advance Rs. 1,000. (vii) Interest on capital 10% (only on cash introduced as capital). (viii) Interest on drawings charged 5% (Total drawings till now is Rs. 10,000). (ix) Depreciation on machinery provided 10%. (x) Rent paid in cash Rs. 1,000 and rent outstanding Rs. 500. (xi) Prepaid insurance Rs. 1,000. (xii) Bad debts written off Rs. 1,000.

Discussion

2262.	An alternative term used for accumulated depreciation expenses?
Answer» An alternative term used for accumulated depreciation expenses?

Discussion

2263.	A draws a bill on B for Rs. 60,000 on 1st January, 2016, X accepts the same on 4th January, 2016 for period of 3 months after date. What will be the maturity date of the bill?
Answer» A draws a bill on B for Rs. 60,000 on 1st January, 2016, X accepts the same on 4th January, 2016 for period of 3 months after date. What will be the maturity date of the bill?

Discussion

2264.	Charging the whole cost of asset in the first year itself is not correct. Why?
Answer» Charging the whole cost of asset in the first year itself is not correct. Why?

Discussion

2265.

Find the amount of credit purchases from the below mentioned details Particulars Rs. Opening Balance of Creditors 20,000 Closing Balance of Creditors 25,000 Payment to Creditors 1,40,000 Return Inwards 2,000

Answer»

Find the amount of credit purchases from the below mentioned details

Particulars	Rs.
Opening Balance of Creditors	20,000
Closing Balance of Creditors	25,000
Payment to Creditors	1,40,000
Return Inwards	2,000

Discussion

2266.	The owner writes a cheque in favor of school for payment of fees of his child. Which account shall be debited in this case?
Answer» The owner writes a cheque in favor of school for payment of fees of his child. Which account shall be debited in this case?

Discussion

2267.	Which of the following is incorrect with regard to goods?
Answer» Which of the following is incorrect with regard to goods?

Discussion

2268.	The sales income (Credit and Cash) of a business during a given period is called _______.
Answer» The sales income (Credit and Cash) of a business during a given period is called _______.

Discussion

2269.	On scrutiny of the books of account, accountant found that, purchase return of Rs 1000 was omitted to be entered in the books of a/c. What shall be the rectifying entry for the same error.
Answer» On scrutiny of the books of account, accountant found that, purchase return of Rs 1000 was omitted to be entered in the books of a/c. What shall be the rectifying entry for the same error.

Discussion

2270.	When a building is bought by paying cash, what will be the impact on accounting equation?
Answer» When a building is bought by paying cash, what will be the impact on accounting equation?

Discussion

2271.	What practical difficulties are encountered by a trader due to incompleteness of accounting records?
Answer» What practical difficulties are encountered by a trader due to incompleteness of accounting records?

Discussion

2272.	In a Journal Entry, ___ is used before the name of the account to be credited.
Answer» In a Journal Entry, ___ is used before the name of the account to be credited.

Discussion

2273.	What do you understand by ledger folio?
Answer» What do you understand by ledger folio?

Discussion

2274.	Which of the following would not appear in the profit and loss account?
Answer» Which of the following would not appear in the profit and loss account?

Discussion

2275.	Explain the dual aspect principle with the help of an example.
Answer» Explain the dual aspect principle with the help of an example.

Discussion

2276.	A company bought machinery for Rs. 50000 and depreciation rate is 18%. Which account shall be credited?
Answer» A company bought machinery for Rs. 50000 and depreciation rate is 18%. Which account shall be credited?

Discussion

2277.	Write any three objectives of Book-keeping.
Answer» Write any three objectives of Book-keeping.

Discussion

2278.	Aman and Harsh were partners in a firm. They decided to dissolve their firm. Pass necessary journal entries for the following after various assets (other than Cash and Bank) and third party liabilities have been transferred to Realisation A/c. (a) There was furniture worth Rs. 50,000. Aman took over 50% of the furniture at 10% discount and the remaining furniture was sold at 30% profit on book value. (b) Profit and Loss Account was showing a credit balance of Rs. 15,000 which was distributed between the partners. (c) Harsh's loan of Rs. 6,000 was discharged at R.s 6,200. (d) The firm paid realization expenses amounting to Rs. 5,000 on behalf of Harsh who had to bear these expenses. (e) There was a bill for Rs. 1,200 under discount. The bill was received from Soham who proved insolvent and a first and final dividend of 25% of bill amount was received from his estate. (f) Creditors, to whom the firm owed Rs. 6,000, accepted stock of Rs. 5,000 at a discount of 5% and the balance in cash. (g) The loss on dissolution was Rs. 8,000.
Answer» Aman and Harsh were partners in a firm. They decided to dissolve their firm. Pass necessary journal entries for the following after various assets (other than Cash and Bank) and third party liabilities have been transferred to Realisation A/c. (a) There was furniture worth Rs. 50,000. Aman took over 50% of the furniture at 10% discount and the remaining furniture was sold at 30% profit on book value. (b) Profit and Loss Account was showing a credit balance of Rs. 15,000 which was distributed between the partners. (c) Harsh's loan of Rs. 6,000 was discharged at R.s 6,200. (d) The firm paid realization expenses amounting to Rs. 5,000 on behalf of Harsh who had to bear these expenses. (e) There was a bill for Rs. 1,200 under discount. The bill was received from Soham who proved insolvent and a first and final dividend of 25% of bill amount was received from his estate. (f) Creditors, to whom the firm owed Rs. 6,000, accepted stock of Rs. 5,000 at a discount of 5% and the balance in cash. (g) The loss on dissolution was Rs. 8,000.

2278.

Aman and Harsh were partners in a firm. They decided to dissolve their firm. Pass necessary journal entries for the following after various assets (other than Cash and Bank) and third party liabilities have been transferred to Realisation A/c. (a) There was furniture worth Rs. 50,000. Aman took over 50% of the furniture at 10% discount and the remaining furniture was sold at 30% profit on book value. (b) Profit and Loss Account was showing a credit balance of Rs. 15,000 which was distributed between the partners. (c) Harsh's loan of Rs. 6,000 was discharged at R.s 6,200. (d) The firm paid realization expenses amounting to Rs. 5,000 on behalf of Harsh who had to bear these expenses. (e) There was a bill for Rs. 1,200 under discount. The bill was received from Soham who proved insolvent and a first and final dividend of 25% of bill amount was received from his estate. (f) Creditors, to whom the firm owed Rs. 6,000, accepted stock of Rs. 5,000 at a discount of 5% and the balance in cash. (g) The loss on dissolution was Rs. 8,000.

Answer»

Aman and Harsh were partners in a firm. They decided to dissolve their firm. Pass necessary journal entries for the following after various assets (other than Cash and Bank) and third party liabilities have been transferred to Realisation A/c.

(a) There was furniture worth Rs. 50,000. Aman took over 50% of the furniture at 10% discount and the remaining furniture was sold at 30% profit on book value.

(b) Profit and Loss Account was showing a credit balance of Rs. 15,000 which was distributed between the partners.

(c) Harsh's loan of Rs. 6,000 was discharged at R.s 6,200.

(d) The firm paid realization expenses amounting to Rs. 5,000 on behalf of Harsh who had to bear these expenses.

(e) There was a bill for Rs. 1,200 under discount. The bill was received from Soham who proved insolvent and a first and final dividend of 25% of bill amount was received from his estate.

(f) Creditors, to whom the firm owed Rs. 6,000, accepted stock of Rs. 5,000 at a discount of 5% and the balance in cash.

(g) The loss on dissolution was Rs. 8,000.

Discussion

2279.	Why are duplicate tuples not allowed in a relation?
Answer» Why are duplicate tuples not allowed in a relation?

Discussion

2280.	Prepaid expenses are considered as ________
Answer» Prepaid expenses are considered as ________

Discussion

2281.	Why it is necessary for accountants to assume that a business entity will remain a going concern?
Answer» Why it is necessary for accountants to assume that a business entity will remain a going concern?

Discussion

2282.	In which method, the depreciation is constant and in which method, the depreciation is higher in initial years when compared to later years?
Answer» In which method, the depreciation is constant and in which method, the depreciation is higher in initial years when compared to later years?

Discussion

2283.	Give any two differences between Reserve and Provision.
Answer» Give any two differences between Reserve and Provision.

Discussion

2284.	Balance in books of accounts for preparation of bank reconciliation statement shall be taken from?
Answer» Balance in books of accounts for preparation of bank reconciliation statement shall be taken from?

Discussion

2285.	Q39)Statements: I. The local co-operative credit society has decided to stop giving loans to farmers with immediate effect. II. A large number of credit society members have withdrawn major part of their deposits from the credit society.
Answer» Q39)Statements: I. The local co-operative credit society has decided to stop giving loans to farmers with immediate effect. II. A large number of credit society members have withdrawn major part of their deposits from the credit society.

2285.

Q39)Statements: I. The local co-operative credit society has decided to stop giving loans to farmers with immediate effect. II. A large number of credit society members have withdrawn major part of their deposits from the credit society.

Answer»

Q39)Statements:

I. The local co-operative credit society has decided to stop giving loans to farmers with immediate effect.

II. A large number of credit society members have withdrawn major part of their deposits from the credit society.

Discussion

2286.	Which of the following is a benefit of preparing BRS?
Answer» Which of the following is a benefit of preparing BRS?

Discussion

2287.	Following are the advantages of bill of exchange?
Answer» Following are the advantages of bill of exchange?

Discussion

2288.	What is a contra entry? How can you deal with this entry while preparing a double column cash book?
Answer» What is a contra entry? How can you deal with this entry while preparing a double column cash book?

Discussion

2289.	What is 'Depreciation'?
Answer» What is 'Depreciation'?

Discussion

2290.	Opening debtors = Rs. 1,20,000, Closing debtors = Rs. 2,40,000, Receipts from debtors = Rs. 52,000. What is the amount of credit sales during the year?
Answer» Opening debtors = Rs. 1,20,000, Closing debtors = Rs. 2,40,000, Receipts from debtors = Rs. 52,000. What is the amount of credit sales during the year?

Discussion

2291.	Match the following Interested Users with their need to use the Financial Information of any company. A) Management B) Customers C) Employees D) Lenders 1. To estimate the ability of the borrower to pay back all loaned funds and related interest charges. 2. To increase the level of employee involvement in and understanding of the business. 3. To make operational and financing decisions about the business. 4. To judge the financial ability of a supplier to remain in business long enough to provide the goods or services mandated in the contract.
Answer» Match the following Interested Users with their need to use the Financial Information of any company. A) Management B) Customers C) Employees D) Lenders 1. To estimate the ability of the borrower to pay back all loaned funds and related interest charges. 2. To increase the level of employee involvement in and understanding of the business. 3. To make operational and financing decisions about the business. 4. To judge the financial ability of a supplier to remain in business long enough to provide the goods or services mandated in the contract.

Discussion

2292.	Bansal Traders allow a trade discount of 10% on the list price of the goods purchased from them. Mohan traders, who run a retail shop made the following purchase from Bansal Traders. Date Amt. (Rs) Dec 21, 2005 1,000 Dec 26, 2005 1,200 Dec 18, 2005 2,000 Dec 31, 2005 5,000 For all the purchase, Mohan Traders drew a promissory note in favour of Bansal Traders payable after 30 days. The promissory note for the sale of December 21, 2010, was retained by Bansal Traders with them till the date of its maturity. The promissory note drawn on 26.12.2010 was discounted by Bansal Traders from their bank at 12% per annum. The promissory note drawn on December 28, 2010, was endorsed by Bansal Traders in favour of their creditor Dream Soaps in full settlement of a purchase amounting to Rs. 1,900. On 25.01.2011, Bansal Traders sent the promissory note drawn on December 31, 2010, to their bank for collection. All the promissory notes were met by Mohan Traders. Record the necessary journal entries for the above transactions in the books of Bansal Traders and Mohan Traders and prepare Mohan Traders account in the books of Bansal Traders and Bansal Traders account in the books of Mohan Traders.
Answer» Bansal Traders allow a trade discount of 10% on the list price of the goods purchased from them. Mohan traders, who run a retail shop made the following purchase from Bansal Traders. Date Amt. (Rs) Dec 21, 2005 1,000 Dec 26, 2005 1,200 Dec 18, 2005 2,000 Dec 31, 2005 5,000 For all the purchase, Mohan Traders drew a promissory note in favour of Bansal Traders payable after 30 days. The promissory note for the sale of December 21, 2010, was retained by Bansal Traders with them till the date of its maturity. The promissory note drawn on 26.12.2010 was discounted by Bansal Traders from their bank at 12% per annum. The promissory note drawn on December 28, 2010, was endorsed by Bansal Traders in favour of their creditor Dream Soaps in full settlement of a purchase amounting to Rs. 1,900. On 25.01.2011, Bansal Traders sent the promissory note drawn on December 31, 2010, to their bank for collection. All the promissory notes were met by Mohan Traders. Record the necessary journal entries for the above transactions in the books of Bansal Traders and Mohan Traders and prepare Mohan Traders account in the books of Bansal Traders and Bansal Traders account in the books of Mohan Traders.

2292.

Bansal Traders allow a trade discount of 10% on the list price of the goods purchased from them. Mohan traders, who run a retail shop made the following purchase from Bansal Traders. Date Amt. (Rs) Dec 21, 2005 1,000 Dec 26, 2005 1,200 Dec 18, 2005 2,000 Dec 31, 2005 5,000 For all the purchase, Mohan Traders drew a promissory note in favour of Bansal Traders payable after 30 days. The promissory note for the sale of December 21, 2010, was retained by Bansal Traders with them till the date of its maturity. The promissory note drawn on 26.12.2010 was discounted by Bansal Traders from their bank at 12% per annum. The promissory note drawn on December 28, 2010, was endorsed by Bansal Traders in favour of their creditor Dream Soaps in full settlement of a purchase amounting to Rs. 1,900. On 25.01.2011, Bansal Traders sent the promissory note drawn on December 31, 2010, to their bank for collection. All the promissory notes were met by Mohan Traders. Record the necessary journal entries for the above transactions in the books of Bansal Traders and Mohan Traders and prepare Mohan Traders account in the books of Bansal Traders and Bansal Traders account in the books of Mohan Traders.

Answer»

Bansal Traders allow a trade discount of 10% on the list price of the goods purchased from them. Mohan traders, who run a retail shop made the following purchase from Bansal Traders.

Date Amt. (Rs)

Dec 21, 2005 1,000

Dec 26, 2005 1,200

Dec 18, 2005 2,000

Dec 31, 2005 5,000

For all the purchase, Mohan Traders drew a promissory note in favour of Bansal Traders payable after 30 days. The promissory note for the sale of December 21, 2010, was retained by Bansal Traders with them till the date of its maturity. The promissory note drawn on 26.12.2010 was discounted by Bansal Traders from their bank at 12% per annum. The promissory note drawn on December 28, 2010, was endorsed by Bansal Traders in favour of their creditor Dream Soaps in full settlement of a purchase amounting to Rs. 1,900. On 25.01.2011, Bansal Traders sent the promissory note drawn on December 31, 2010, to their bank for collection.

All the promissory notes were met by Mohan Traders. Record the necessary journal entries for the above transactions in the books of Bansal Traders and Mohan Traders and prepare Mohan Traders account in the books of Bansal Traders and Bansal Traders account in the books of Mohan Traders.

Discussion

2293.	Is bank reconciliation statement, a part of double entry system?
Answer» Is bank reconciliation statement, a part of double entry system?

Discussion

2294.	On 01.01.2012, X draws a bill on Y for Rs. 30,000. At maturity, the bill is dishonoured and Y requests X to draw a fresh bill for 2 months together with 12 % p.a interest. Noting charges amount to Rs. 100. The amount of interest will be:
Answer» On 01.01.2012, X draws a bill on Y for Rs. 30,000. At maturity, the bill is dishonoured and Y requests X to draw a fresh bill for 2 months together with 12 % p.a interest. Noting charges amount to Rs. 100. The amount of interest will be:

Discussion

2295.	What is the correct adjustment entry for accrued interest on investments of Rs 1,000?
Answer» What is the correct adjustment entry for accrued interest on investments of Rs 1,000?

Discussion

2296.	Company pays for the purchase of office equipments last month. Which account shall be debited in this case?
Answer» Company pays for the purchase of office equipments last month. Which account shall be debited in this case?

Discussion

2297.	Who are the external users of information?
Answer» Who are the external users of information?

Discussion

2298.	Prepare Trading and Profit & Loss Account and Balance sheet from the following Trial Balance as on March 31, 2012. Trial Balance Head of AccountsDr.BalanceCr.Balance(Rs) (Rs) Purchase and Sales3,20,0005,30,000Purchase Returns and Sales Returns30,00020,000Opening Stock40,000−Wages15,000−Power Charges30,000−Salaries28,000−Apprenticeship Premium−15,000Rent16,000−Rent Outstanding−4,000October 1,201182,000−Bills Receivable68,000−Bills payable−16,000Plant and Machinery1,60,000−Debtors and Creditors90,00050,000Cash in Hand11,000−Cash at Bank70,000−Capital−3,15,000¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯9,50,000––––––––––¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯9,50,000–––––––––– Additional Information: (a) Closing stock is valued at Rs 25,000. (b) Goods costing Rs 32,000 purchased from Agra are still in transit. (c) Apprenticeship premium is for two years. For one year, it is in advance. (d) Depreciate Plant and Machinery 10% and Furniture 20%. (e) Wages of Rs 5,000 are outstanding. Or The following is the trial balance of Mr. Rajeev Gautam on 31st March, 2012. ParticularsDr.AmountCr.Amount(Rs) (Rs) Cash in Hand10,800−Cash at Bank52,600−Purchases8,13,500−Sales−19,75,600Returns Outward−10,000Wages2,09,600−Fuel and Power94,600−Carriage Outwards64,000−Carriage Inwards40,800−Stock(1st April,2011)1,15,200−Building6,00,000−Freehold Land2,00,000−Machinery4,00,000−Salaries3,00,000−Patents1,50,000−General Expenses60,000−Insurance12,000−Capital−14,20,000Drawings1,04,900−Sundry Debtors2,90,000−Sundry Creditors −–––––––––– 1,26,000–––––––––––35,31,600–––––––––––35,31,600––––––––––– Taking into account the following adjustments, prepare Trading and Profit & Loss Account and the Balance Sheet: (a) Stock on hand on 31st March, 2011 is Rs 1,36,000. (b) Machinery is to be depreciated 10% and patents 20%. (c) Salary for the month of March, 2012 amounting to Rs 30,000 were unpaid. (d) Insurance includes a premium of Rs 1,700 due in next year. (e) Wages include a sum of Rs 40,000 spent on the erection of cycle shed for employees and customers. (f) A provision for bad debts is to be created to the extent of 5% on Sundry debtors.
Answer» Prepare Trading and Profit & Loss Account and Balance sheet from the following Trial Balance as on March 31, 2012. Trial Balance $\begin{matrix} Head of Accounts & Dr.Balance & Cr.Balance (Rs) & (Rs) Purchase and Sales & 3, 20, 000 & 5, 30, 000 Purchase Returns and Sales Returns & 30, 000 & 20, 000 Opening Stock & 40, 000 & - Wages & 15, 000 & - Power Charges & 30, 000 & - Salaries & 28, 000 & - Apprenticeship Premium & - & 15, 000 Rent & 16, 000 & - Rent Outstanding & - & 4, 000 October 1,2011 & 82, 000 & - Bills Receivable & 68, 000 & - Bills payable & - & 16, 000 Plant and Machinery & 1, 60, 000 & - Debtors and Creditors & 90, 000 & 50, 000 Cash in Hand & 11, 000 & - Cash at Bank & 70, 000 & - Capital & - & 3, 15, 000 ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 9, 50, 000 - -------- - & ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 9, 50, 000 - -------- - \end{matrix}$ Additional Information: (a) Closing stock is valued at Rs 25,000. (b) Goods costing Rs 32,000 purchased from Agra are still in transit. (c) Apprenticeship premium is for two years. For one year, it is in advance. (d) Depreciate Plant and Machinery 10% and Furniture 20%. (e) Wages of Rs 5,000 are outstanding. Or The following is the trial balance of Mr. Rajeev Gautam on 31st March, 2012. $\begin{matrix} Particulars & Dr.Amount & Cr.Amount (Rs) & (Rs) Cash in Hand & 10, 800 & - Cash at Bank & 52, 600 & - Purchases & 8, 13, 500 & - Sales & - & 19, 75, 600 Returns Outward & - & 10, 000 Wages & 2, 09, 600 & - Fuel and Power & 94, 600 & - Carriage Outwards & 64, 000 & - Carriage Inwards & 40, 800 & - Stock(1st April,2011) & 1, 15, 200 & - Building & 6, 00, 000 & - Freehold Land & 2, 00, 000 & - Machinery & 4, 00, 000 & - Salaries & 3, 00, 000 & - Patents & 1, 50, 000 & - General Expenses & 60, 000 & - Insurance & 12, 000 & - Capital & - & 14, 20, 000 Drawings & 1, 04, 900 & - Sundry Debtors & 2, 90, 000 & - Sundry Creditors & - - -------- - & 1, 26, 000 - --------- - 35, 31, 600 - --------- - & 35, 31, 600 - --------- - \end{matrix}$ Taking into account the following adjustments, prepare Trading and Profit & Loss Account and the Balance Sheet: (a) Stock on hand on 31st March, 2011 is Rs 1,36,000. (b) Machinery is to be depreciated 10% and patents 20%. (c) Salary for the month of March, 2012 amounting to Rs 30,000 were unpaid. (d) Insurance includes a premium of Rs 1,700 due in next year. (e) Wages include a sum of Rs 40,000 spent on the erection of cycle shed for employees and customers. (f) A provision for bad debts is to be created to the extent of 5% on Sundry debtors.

2298.

Prepare Trading and Profit & Loss Account and Balance sheet from the following Trial Balance as on March 31, 2012. Trial Balance Head of AccountsDr.BalanceCr.Balance(Rs) (Rs) Purchase and Sales3,20,0005,30,000Purchase Returns and Sales Returns30,00020,000Opening Stock40,000−Wages15,000−Power Charges30,000−Salaries28,000−Apprenticeship Premium−15,000Rent16,000−Rent Outstanding−4,000October 1,201182,000−Bills Receivable68,000−Bills payable−16,000Plant and Machinery1,60,000−Debtors and Creditors90,00050,000Cash in Hand11,000−Cash at Bank70,000−Capital−3,15,000¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯9,50,000––––––––––¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯9,50,000–––––––––– Additional Information: (a) Closing stock is valued at Rs 25,000. (b) Goods costing Rs 32,000 purchased from Agra are still in transit. (c) Apprenticeship premium is for two years. For one year, it is in advance. (d) Depreciate Plant and Machinery 10% and Furniture 20%. (e) Wages of Rs 5,000 are outstanding. Or The following is the trial balance of Mr. Rajeev Gautam on 31st March, 2012. ParticularsDr.AmountCr.Amount(Rs) (Rs) Cash in Hand10,800−Cash at Bank52,600−Purchases8,13,500−Sales−19,75,600Returns Outward−10,000Wages2,09,600−Fuel and Power94,600−Carriage Outwards64,000−Carriage Inwards40,800−Stock(1st April,2011)1,15,200−Building6,00,000−Freehold Land2,00,000−Machinery4,00,000−Salaries3,00,000−Patents1,50,000−General Expenses60,000−Insurance12,000−Capital−14,20,000Drawings1,04,900−Sundry Debtors2,90,000−Sundry Creditors −–––––––––– 1,26,000–––––––––––35,31,600–––––––––––35,31,600––––––––––– Taking into account the following adjustments, prepare Trading and Profit & Loss Account and the Balance Sheet: (a) Stock on hand on 31st March, 2011 is Rs 1,36,000. (b) Machinery is to be depreciated 10% and patents 20%. (c) Salary for the month of March, 2012 amounting to Rs 30,000 were unpaid. (d) Insurance includes a premium of Rs 1,700 due in next year. (e) Wages include a sum of Rs 40,000 spent on the erection of cycle shed for employees and customers. (f) A provision for bad debts is to be created to the extent of 5% on Sundry debtors.

Answer»

Prepare Trading and Profit & Loss Account and Balance sheet from the following Trial Balance as on March 31, 2012.

Trial Balance

$\begin{matrix} Head of Accounts & Dr.Balance & Cr.Balance (Rs) & (Rs) Purchase and Sales & 3, 20, 000 & 5, 30, 000 Purchase Returns and Sales Returns & 30, 000 & 20, 000 Opening Stock & 40, 000 & - Wages & 15, 000 & - Power Charges & 30, 000 & - Salaries & 28, 000 & - Apprenticeship Premium & - & 15, 000 Rent & 16, 000 & - Rent Outstanding & - & 4, 000 October 1,2011 & 82, 000 & - Bills Receivable & 68, 000 & - Bills payable & - & 16, 000 Plant and Machinery & 1, 60, 000 & - Debtors and Creditors & 90, 000 & 50, 000 Cash in Hand & 11, 000 & - Cash at Bank & 70, 000 & - Capital & - & 3, 15, 000 ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 9, 50, 000 - -------- - & ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 9, 50, 000 - -------- - \end{matrix}$

Additional Information:

(a) Closing stock is valued at Rs 25,000.
(b) Goods costing Rs 32,000 purchased from Agra are still in transit.
(c) Apprenticeship premium is for two years. For one year, it is in advance.
(d) Depreciate Plant and Machinery 10% and Furniture 20%.
(e) Wages of Rs 5,000 are outstanding.

Or

The following is the trial balance of Mr. Rajeev Gautam on 31st March, 2012.

$\begin{matrix} Particulars & Dr.Amount & Cr.Amount (Rs) & (Rs) Cash in Hand & 10, 800 & - Cash at Bank & 52, 600 & - Purchases & 8, 13, 500 & - Sales & - & 19, 75, 600 Returns Outward & - & 10, 000 Wages & 2, 09, 600 & - Fuel and Power & 94, 600 & - Carriage Outwards & 64, 000 & - Carriage Inwards & 40, 800 & - Stock(1st April,2011) & 1, 15, 200 & - Building & 6, 00, 000 & - Freehold Land & 2, 00, 000 & - Machinery & 4, 00, 000 & - Salaries & 3, 00, 000 & - Patents & 1, 50, 000 & - General Expenses & 60, 000 & - Insurance & 12, 000 & - Capital & - & 14, 20, 000 Drawings & 1, 04, 900 & - Sundry Debtors & 2, 90, 000 & - Sundry Creditors & - - -------- - & 1, 26, 000 - --------- - 35, 31, 600 - --------- - & 35, 31, 600 - --------- - \end{matrix}$

Taking into account the following adjustments, prepare Trading and Profit & Loss Account and the Balance Sheet:

(a) Stock on hand on 31st March, 2011 is Rs 1,36,000.
(b) Machinery is to be depreciated 10% and patents 20%.
(c) Salary for the month of March, 2012 amounting to Rs 30,000 were unpaid.
(d) Insurance includes a premium of Rs 1,700 due in next year.
(e) Wages include a sum of Rs 40,000 spent on the erection of cycle shed for employees and customers.
(f) A provision for bad debts is to be created to the extent of 5% on Sundry debtors.

Discussion

2299.	Which of the following best completes the passage below? One tax-reform proposal that has gained increasing support in recent years is the flat tax, which would impose a uniform tax rate on incomes at every level. Opponents of the flat tax say that a progressive tax system, which levies a higher rate of taxes on higher-income taxpayers, is fairer, placing the greater burden on those better able to bear it. However, the present crazy quilt of tax deductions, exemptions, credits, and loopholes benefits primarily the high-income taxpayer, who is consequently able to reduce his or her effective tax rate, often to a level below that paid by the lower-income taxpayer. Therefore, ___.
Answer» Which of the following best completes the passage below? One tax-reform proposal that has gained increasing support in recent years is the flat tax, which would impose a uniform tax rate on incomes at every level. Opponents of the flat tax say that a progressive tax system, which levies a higher rate of taxes on higher-income taxpayers, is fairer, placing the greater burden on those better able to bear it. However, the present crazy quilt of tax deductions, exemptions, credits, and loopholes benefits primarily the high-income taxpayer, who is consequently able to reduce his or her effective tax rate, often to a level below that paid by the lower-income taxpayer. Therefore, ___.

Discussion

2300.	If closing inventory is accounted for as Rs. 2,40,000 instead of Rs. 1,80,000:
Answer» If closing inventory is accounted for as Rs. 2,40,000 instead of Rs. 1,80,000:

Discussion

Explore topic-wise InterviewSolutions in .

The standard format of journal does not include which of the following?

Which basis of accounting gives a correct picture of operating results and financial position of a firm?

Non-economic events are not recorded in the books of account. This is according to which concept?

While making the provision for tax in the books, which account is debited?

The preparation of adjusting entries is an application of the ___ concept of accounting.

Original cost of machine is Rs. 4,00,000 with a scrap value of Rs. 25,000 after 4 years. Calculate rate of Depreciation.

The Historical cost or cost principle is not applicable to which of the following assets:

State when cash book balance is lower than pass book balance.

An alternative term used for accumulated depreciation expenses?

A draws a bill on B for Rs. 60,000 on 1st January, 2016, X accepts the same on 4th January, 2016 for period of 3 months after date. What will be the maturity date of the bill?

Charging the whole cost of asset in the first year itself is not correct. Why?

Find the amount of credit purchases from the below mentioned details Particulars Rs. Opening Balance of Creditors 20,000 Closing Balance of Creditors 25,000 Payment to Creditors 1,40,000 Return Inwards 2,000

The owner writes a cheque in favor of school for payment of fees of his child. Which account shall be debited in this case?

Which of the following is incorrect with regard to goods?

The sales income (Credit and Cash) of a business during a given period is called _______.

On scrutiny of the books of account, accountant found that, purchase return of Rs 1000 was omitted to be entered in the books of a/c. What shall be the rectifying entry for the same error.

When a building is bought by paying cash, what will be the impact on accounting equation?

What practical difficulties are encountered by a trader due to incompleteness of accounting records?

In a Journal Entry, ___ is used before the name of the account to be credited.

What do you understand by ledger folio?

Which of the following would not appear in the profit and loss account?

Explain the dual aspect principle with the help of an example.

A company bought machinery for Rs. 50000 and depreciation rate is 18%. Which account shall be credited?

Write any three objectives of Book-keeping.

Why are duplicate tuples not allowed in a relation?

Prepaid expenses are considered as ________

Why it is necessary for accountants to assume that a business entity will remain a going concern?

In which method, the depreciation is constant and in which method, the depreciation is higher in initial years when compared to later years?

Give any two differences between Reserve and Provision.

Balance in books of accounts for preparation of bank reconciliation statement shall be taken from?

Q39)Statements: I. The local co-operative credit society has decided to stop giving loans to farmers with immediate effect. II. A large number of credit society members have withdrawn major part of their deposits from the credit society.

Which of the following is a benefit of preparing BRS?

Following are the advantages of bill of exchange?

What is a contra entry? How can you deal with this entry while preparing a double column cash book?

What is 'Depreciation'?

Opening debtors = Rs. 1,20,000, Closing debtors = Rs. 2,40,000, Receipts from debtors = Rs. 52,000. What is the amount of credit sales during the year?

Is bank reconciliation statement, a part of double entry system?

On 01.01.2012, X draws a bill on Y for Rs. 30,000. At maturity, the bill is dishonoured and Y requests X to draw a fresh bill for 2 months together with 12 % p.a interest. Noting charges amount to Rs. 100. The amount of interest will be:

What is the correct adjustment entry for accrued interest on investments of Rs 1,000?

Company pays for the purchase of office equipments last month. Which account shall be debited in this case?

Who are the external users of information?

If closing inventory is accounted for as Rs. 2,40,000 instead of Rs. 1,80,000: