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InterviewSolution
This section includes InterviewSolutions, each offering curated multiple-choice questions to sharpen your knowledge and support exam preparation. Choose a topic below to get started.
| 51. |
X Y and Zare partnersin afirmsharingprofits and lossesin theratio of 5:3,2 their fixed capitalswere Rs. 3,00,000 Rs. 2,00,000 and1,00,000respectively for the yearended31st March2019 interestoncapitalwascredited to them @ 10% p.a insteadof 8%p.aShowingyourworking notesclearly passneecessary adjusment journalenttry . |
Answer» SOLUTION : Lowrateof INTERESTON capitalwillincrease theprofit of the firmby RS. 12,000-Rs.48,000) whichis divisibleamong PARTNERS . |
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| 52. |
X, Y and Z are partners in a firm sharing profits and losses as 5:4:3. Their Balance Sheet as at 31st March, 2019 was : From 1st April, 2019, they agree to alter their profit-sharing ratio as 4:3:2. It is also decided that : (a) Furniture be taken at 80% of its value. (b) Stock be appreciated by 20 %. (c) Plant and Machinery be valued at ₹ 4,00,000. (d) Outstandig Expenses be increased by ₹ 13,000. Partners agreed that altered values are not to be recorded in the books and they also do not want to distribute the General Reserve. You are required to pass a single Journal entry to give effect to the above. Also, prepare Balance Sheet of the new firm. |
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Answer» |
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| 53. |
X Ltd. with a nominal capital of Rs. 50,00,000 in equity shares of Rs. 10 each, issued 2,00,000 shares payable Rs. 2.50 per share on application, Rs. 2.50 per share on allotment and Rs. 5 per share on first and final call three months later. All moneys payable on allotment were duly received but one shareholder failed to pay the amount due on allotment on his 2,500 shares, while another shareholder who held 2,000 shares paid for the shares and final call also. Make the necessary Journal entries in the company's books to record the above transactions upto allotment of shares and show the company's Balance Sheet. |
| Answer» Solution :Cash at BANK Rs. 10,03,750, Cash received on allotmetn Rs. 5,03,750 (Rs. 5,00,000 - Rs. 6,250 + Rs. 10,000). BALANCE SHEET Total Rs. 10,03,750. | |
| 54. |
X Ltd.wants to redeem 5,000, 5% Debentures of Rs. 100 each at 5% premium. How much amount it must transfer to Debenture Redemption Reserve, if it has already a balance of Rs. 1,00,000 in Debenture Redemption Reserve Account? |
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Answer» RS. 4,00,000 |
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| 55. |
X ltd. Purchased a running business from G Ltd. for a sum of Rs. 18,00,000 payable by issue of equity shares of Rs. 100 each at a premium of Rs. 20 per share. The assets and liabilities consisted of thefollowing: Plant - 3,50,000, Land - Rs. 6,00,000, Stock - Rs. 4,50,000 and Creditors - Rs. 1,00,000. Pass necessary Journal entries in thebooks of X Ltd. for theabove transactions. |
Answer» SOLUTION : NOTE: No. of Equity Shares shares to be ISSUED = Rs. 18,00,000/Rs. 120 = 15,000 shares. |
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| 56. |
X Ltd. purchased furniture of Rs. 10,00,000 from Y Ltd.and paid 20% of the amount by accepting a bill of exchange in favour of Y Led. The remaining amount was paid by issuing equity shares of Rs. 100 each at a premium of 25% to Y Led. Showing your working notes clearly, passnecessary Journal entries for the above transactions in the books of X Ltd. |
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Answer» Solution :(i) Dr. Furniture A/c and Cr. Y Ltd. By Rs. 10,00,000. (II) Dr. Y Ltd. - Rs. 10,00,000, Cr. Bills Payable A/c - Rs. 2,00,000, Equity Share Capital A/c - Rs. 6,40,000 and Securities PREMIUM Reserve A/c - Rs. 1,60,000. NOTE: No. of Equity Shares to be Issued = (Purchase Price- Payment through Bill of Exchange) `DIV` Issue Price = (Rs. 10,00,000 - Rs. 2,00,000)` div` Rs. 125 = 6,400 shares. |
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| 57. |
X Ltd. Issued Rs.80,00,000, 8% debentures of Rs.100 each on 1st April, 2007. The terms of issue stated that the debentures were to be redeemed at a premium of 5% on 30th June, 2015. The company decided to transfer out of profits Rs.10,00,000 to Debenture Redemption Reserve on 31st March, 2014 and Rs.10,00,000 and 31st March, 2015. Pass the necessary Journal entries regarding the issue and redemption of debentures, without providing for either the interest or loss on issue of debentures. |
| Answer» SOLUTION :DRR TRANSFERRED to GENERAL RESERVE Rs.20,00,000, Debenture Redemption InvestmentRs.12,00,000. | |
| 58. |
X Ltd. Purchased a buildingfor .Rs 60,00,000 payable as 20 % in Cash and balance by allotment of 8% debentures of .Rs 500 each at a premium of 20% Number of debentures issued will be : |
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Answer» `9,600` |
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| 59. |
X Ltd. Wants to redeem 5,000, 5% Debentures of Rs.100 each at 5% premium. How much amount it must transfer to Debenture Redemption Reserve, if it has already a balance of Rs.1,00,000 in Debenture Redemption Reserve Account? |
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Answer» Rs.4,00,000 |
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| 60. |
X Ltd. issued for Public subscription 1,00,000 equity shares of Rs. 10 each at a premium of Rs. 5 per share payable as under : {:("On Application","Rs. 5"),("On Allotment","Rs. 7 (including premium Rs. 5)"),("On First &Final Call","Rs. 3"):} Applications were received for 1,50,000 shares. Allotment was made pro-rata to all the applicants and the money overpaid on application was utilised towards sums due on allotment. Suruchi, who applied for 1,800 shares failed to pay the allotment and call money and the shares were subsequently forfeited. Two - third of the forfeited shares were re-issued to Supriya as fully paid up at Rs. 8 per share. Show the journal entries to record the above transactions. |
Answer» SOLUTION :  
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| 61. |
X Ltd., issued 50,000 shares of Rs. 10 each at a premium of Rs. 2 per share payable as follows : Rs. 3 on Application Rs. 6 on Allotment (including premium) and Rs. 3 on call. Applications were received for 75,000 shares and pro-rata allotment was made as follows : To the applicants of 40,000 shares, 30,000 shares were issued and for the rest 20,000 shares were issued. All moneys due were received except the allotment and call money from Ram who had applied for 1,200 shares (out of the group of 40,000 shares). All his shares were forfeited. The forfeited shares were re-issued Rs. 7 per share fully paid-up.Pass necessary journal entries for the above transactions. |
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Answer» Solution :Amount RECEIVED on allotment Rs. 2,20,500, Amount received on first & final call Rs. 1,47,300, Amount transferred to Capital Reserve Rs. 900. HINT : Scheme of Allotment : `{:(,"APPLIED","Allotted"),(,"40,000Shares","30,000Shares"),("Remaining",ul("35,000") "Shares",ul("20,000") "Shares"),(,ul("75,000"),ul("50,000")):}` |
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| 62. |
X Ltd., issued 40,000 Equity Shares of Rs. 10 each at a premium of Rs. 2.50 per share. The amount was payable as follows : {:("On Application","Rs. 2 per share"),("On Allotment","Rs. 4.50 per share (including premium)"),("On Call","Rs. 6 per share"):} Owing to heavy subscription the allotment was made on pro-rata baiss as follows : (a) Applicants for 20,000 shares were allotted 10,000 shares. (b) Applicants for 56,000 shares were allotted 14,000 shares. (c ) Applicants for 48,000 shares were allotted 16,000 shares. It was decided that excess amount received on applications would be utilized on allotment and the surplus would be refunded. Ram, to whom 1,000 shares were allotted, who belong to catogry (a), gailed to pay allotment money. His shares were forfeited after the call.Pass the necessary Journal entries in the books of X Ltd. for the above transactions. |
| Answer» SOLUTION :AMOUNT received on allotment Rs. 30,500, Amount received on FIRST & Final Call Rs. 2,34,000, Forfeited Shares ACCOUNT Rs. 4,000. | |
| 63. |
X Ltd. invited applied for issuing 75,000 equity shares of Rs. 10 each at a premium of Rs. 5 per share. The amount was payable as follows : On application and allotment - Rs. 9 per share (including premium) On first and fina lcall - the balance amount. Applications for 3,00,000 shares were received. Applications for 2,00,000 shares were rejected and money refunded. Shares were allotted on pro-rata basis to the remaining applicants. The first and final call was made. The amount was duly received except on 1,500 shares applied by Ravi. His share were forfeited. The forfeited shares were re-issued at a discount of Rs. 4 per share. Excess application and allotment money can be utilised for calls. Pass necessary journal entries for the above transactions in the books of X Ltd. |
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Answer» SOLUTION :Amount RECEIVED on First and Final Call RS. 2,21,625, Capital RESERVE Rs. 3,375. Hint : Securities Premium Reserve A/c will not be DEBITED at the time of forfeiture of shares. |
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| 64. |
X Ltd., invited applications for the issue of 10,00,000 equity shares of Rs. 10 each payable as follows : {:("On application and allotment","Rs. 3 per share"),("On first call","Rs. 4 per share"),("On second and final call","Rs. 3 per share"):} Applications for 15,00,000 shares were received and pro-rata allotment was made to all the applicants. Excess application money was adjusted on the sums due on first call. When the first call was made one shareholder who had applied for 15,000 shares did not pay the first call money.Pass necessary journal entries in the books of the company. |
| Answer» Solution :Net amount received on Ist CALL in cash RS. 24,75,000. | |
| 65. |
X Ltd. invited applications for issuing 50,000 equiuty shares of Rs. 10 each. The amount was payable as follows: {:("On Application",,-,,"Rs. 2 per share,"),("On Allotment",,-,,"Rs. 2 per share,"),("On First Call",,-,,"Rs. 3 per share,"),("On Second and Final Call",,-,,"Balance amount."):} Applications for 70,000 shares were received. Applications for 10,000 shares were rejected and the application money was refunded. Shares were allotted to the remaining applicants on a pro rata basis and excess monay received with applications was transferred towards sums due on allotment and calls, if any. Gopal, who applied for 600 shares, paid his entire share money with application. Ghosh, who had applied for 6,000 shares, failed to pay theallotment money and his shares were immediately forfeited. These forfeited. shares were reissued to Sultan for Rs. 20,000, Rs. 4 per share paid-up. The first call money andthesecond andfinal call money was called and duly received. Pass necessary Journal entries for theabove transactions in thebooks of X Ltd. Open Calls-in-Advance Account and Calls-in-Arrears Account wherever necessary. |
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Answer» Solution :ALLOTMENT money due but not paid by Ghosh: Rs. 8,000. Gain on reissue of forfeited shares transferred to CAPITAL RESERVE: Rs. 12,000. JOURNAL Entry For Adjustment of Application Money: Dr. Equity Shares Application A/c: Rs. 1,44,800 Cr. Equity Share Capital A/c (50,000`xx`Rs. 2): Rs. 1,00,000 Equity Shares Allotment A/c [Rs. 19,800 + (500`xx` Rs. 2)]: Rs. 20,800 Bank A/c: Rs. 21,000 and Calls-in-Advance A/c: Rs. 3,000.] |
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| 66. |
X Ltd., invited applications for issuing 80,000 equity shares of Rs. 10 each at a premium of Rs. 2 share. The amount wass payable as follows : On application Rs. 6 (including premium) per share. On allotment Rs. 3 per share. Balance of first and final call. Applications for 90,000 shares were received. Applications for 5,000 shares were rejected and pro-rata allotment was made to the remaining applications. Over payaments received on application was adjusted towards sums due on allotment. All calls were allotted to Vijay. These shares were forfeited and the forfeited shares were re-issued for Rs. 18,400 fully paid up. Pass necessary journal entries in the books of the company. |
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Answer» Solution :Amount received on allotment RS. 2,05,800, CAPITAL RESERVE Rs. 7,000. Hint : SECURITIES Premium Reserve will not be debited at the time of forfeiture of shares. |
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| 67. |
X Ltd. invited applications for issuing 5,00,000 equity shares of Rs. 10 each at per.The amount per share was payable as follows: {:("On Application",-,"Rs.1 per share,"),("On Allotment",-,"Rs. 2 per share,"),("On First call",-,"Rs.3 per share,"),("On Second and Final call",-,"Balance."):} Applications for 8,00,000 shares were received. Applications for 1,00,000 shares were rejected and pro rata allotment was made to the remaining applicants. Excess money received with applications was adjusted sums due on allotment. All calls were made. Ashok, a shareholder holding 5,000 shares, failed to pay the allotment and the call money. Mohan, a shareholder who had applied for 7,000 shares, failed to pay the first and second and final call. Shares of Ashok and Mohan were forfeited after the second and final call. Of the forfeited shares 8,000 shares were reissued at Rs. 12 per share fully paid-up . The reissued shares included all the forfeited shares of Ashok. Pass necessary Journal entries for theabove transactions in the books of X Ltd. |
Answer» Solution :  1. Calculation of allotment money not paid by Ashok: `{:((i),"Total No. of shares applied by Ashok = 7,00,000/5,000=7,000 shares.",Rs.),((ii),"Application money received on shares applied (7,000"xx"Rs.1)","7,000"),((iii),"Excess Application money adjusted on allotment[Rs. 7,000-(5,000"xx"Rs.1)]","2,000"),((iv),"Allotment money due on shares allotted(5,000"xx"Rs. 2)","10,000"),((v),"Allotment money due but not paid by Ashok (Rs.10,000 - Rs.2,000)","8,000"):}` `{:(" 2. Calculation of allotment money received later:",,""Rs.,,""Rs.),("Total allotment money due (5,00,000"xx"Rs.2)",,,,"10,00,000"),("Less: (a) Excess application money to be adjusted on allotment",,"2,00,000",,),("(B) Not received from Ashok(WN 1)",,UL(8,000),,ul(2,08,000)),(,,,,ul(ul(7,92,000))):}` `{:(" 3. Calculation of GAIN (Profit) on REISSUE to be transferred to Capital Reserve:",,Rs.),("Amount FORFEITED on Ashok's 5,000 shares",,"7,000"),("Amount forfeitedon Mohan's 3,000 shares (Rs.15,000"xx"3,000/5,000)",,"9,000"),("Gain (Profit)on reissue to be transferred to Capital Reserve",,bar(ul(ul(16,000)))),(,,):}` |
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| 68. |
X Ltd. invited applications for issuing 50,000 equity shares of Rs. 10 each. The amount was payable as follows: {:("On Application","Rs. 2 per share"),("On Allotment","Rs. 2 per share"),("On First Call","Rs. 3 per share"),("On Second and Final Call","Balance Amount"):} Applications for 70,000 shares were received. Applications for 10,000 shares were rejected and the application money was refunded. Shares were allotted to the remaining applicants on a pro-rata basis and excess money received with applications was transfered towards sums due on allotment and calls, if any. Gopal, who applied for 600 shares, paid his entire share money with application. Ghosh, who had applied for 6,000 shares, failed to pay the allotment money and his shares were immediately forfeited. These forfeited shares were re-issued to Sultan for Rs. 20,000, Rs. 4 per share paidup. The first call money and the second and final call money was called and duly received. Pass necessary journal entries for the above transactions in the books of X Ltd. Open Calls-in-Advance Account and Calls-in-Arrears Account wherever necessary. |
Answer» SOLUTION : 
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| 69. |
X Ltd., invited applications for issuing 5,00,000 equity shares of Rs. 10 each at par. The amount per share was payable as follows : On Application Rs. 1 per share On Allotment Rs. 2 per share On First call Rs. 3 per share On Second and Final Call - Balance. Applications for 8,00,000 shares were received. Applications for 1,00,000 shares were rejected and pro-rata allotment was made to the remaining applicants. Excess money received with applications was adjusted towards sumsdue on allotment. All calls were made. Ashok, a shareholder holding 5,000 shares failed to pay the allotment and the call money. Mohan, a shareholder who had applied for 7,000 shares, failed to pay the first and second and final call. Shares of Ashok and Mohan were forfeited after the second and final call. Of the forfeited shares 8,000 shares were re-issued at Rs. 12 per share fully paid up. The re-issued shares included all the forfeited shares of Ashok. Pass necessary journal entries for the above transactions in the books of X Ltd. |
| Answer» SOLUTION :AMOUNT received on ALLOTMENT RS. 7,92,000, Capital Reserve Rs. 16,000. | |
| 70. |
X Ltd. invited applications for 50,000 shares of Rs. 10 each at 10% premium, payable as Rs. 3 on application, Rs. 3 on allotment and balance amount on first and final call. Applications were received for 1,20,000 shares and shares were allotted on pro-rata basis. The excess money received on application was to be adjusted against allotment only. A shareholder who applied for 6,000 shares, could not pay the call money and his shares were accordingly forfeited. Pass necessary journal entries. |
Answer» SOLUTION : 
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| 71. |
X Ltd.' invited applications for issuing 10,000 Equity Shares of Rs. 100 each at a premium of Rs. 100 per share. The amount was payable as follows: {:("On application and allotment", - ,"Rs. 100 per share (including Rs. 50 premium)"),( "On first and final call", -, " The balance."):}The issue was fully subscribed. A shareholder holding 500 shares paid thefullshare money with application. Another shareholder holding 200 shares failed to paythe first and final call money. His shares were forfeited. The forfeited shares were reissued for Rs. 19,000 as fully paid-up. Pass necessary Journal entries for the above transactions in the books of thecompany. |
| Answer» Solution :AMOUNT TRANSFERRED to CAPITAL RESERVE RS. 9,000. | |
| 72. |
X Ltd., invited applications for 50,000 Equity Shares of Rs. 10 each, payable Rs. 3.50 on application, Rs. 5 on allotment (including premium Rs. 2.50), and Rs. 4 on first and final call. The company received applications for 65,000 shares. It was decided : (a) to refuse allotment to the applicants for 5,000 shares, (b) to allot in full to the applicants for 20,000 shares, (c ) to allot balance of the available shares pro-rata among the other applicants, and (d) to utilise the excess application money in part payament of allotment money. All the money due was received except from one applicant to whom shares had been allotted on pro-rata basis. He failed to pay allotment and call money and his 300 shares were forfeited. These shares were re-issued at Rs. 9 as fully paid. Give journal entries to record the above transactions in the books of the company. |
| Answer» SOLUTION :CASH received on Allotment RS. 2,13,850, Balance of SHARE Forfeiture A/c transferred to Capital Reserve Rs. 1,400 - Rs. 300 = Rs. 1,100. | |
| 73. |
X Ltd. invited applications for 4,00,000 shares of Rs. 10 each. The shares were issued at a premium of Rs. 7 per share. The amount was payable as follows : {:("On Application & Allotment",:,"Rs. 9 per share (including premium Rs. 4)"),("On First & Final Call",:,"The balance amount (including premium)"):} Applications were received for 5,70,000 shares and the allotment was made as under : {:("(i)To applicants for 3,50,000 shares",:,"2,50,000 shares on pro-rata basis"),("(ii)To applicants for 2,00,000 shares",:,"1,50,000 shares on paro-rata basis"),("(iii)To applicants for 20,000 shares",:,"NIL"):} Excess application and allotment money colud be utilized for calls. A, who belonged to the first category and was allotted 500 shares, failed to pay the first call money. B, who belonged to the second category and was allotted 300 shares also failed to pay the first call money. Their shares were forfeited and were re-issued @ Rs. 15 per share fully paid-up. Pass necessary Cash-Book and Journal entries. |
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Answer» Solution :Cash received on first call Rs. 18,46,300, CAPITAL Reserve Rs. 6,700, Cash at Bank Rs. 68,08,300. Note. It has been assumed that the entire excess application and ALLOTMENT MONEY is exclusively for share capital and hence 'Securities Premium Reserve Account' has been DEBITED in the entry for forfeiture. |
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| 74. |
X Ltd. invited applications for 40,000 shares of Rs. 10 each at 5% premium, payable as Rs. 3 on application, Rs. 3.50 on allotment (includin premium) and balance on first and final call. Applications were received on application was to be adjusted against allotment only. A shareholder who applied for 4,500 shares, could not pay the call money and his shares were accordingly forfeited. Pass necesary journal entries and show the items in company's Balance Sheet. |
| Answer» Solution :AMOUNT CREDITED to SHARE Forfeiture ACCOUNT on forfeiture of shares Rs. 12,000. | |
| 75. |
X Ltd. has Rs. 8,00,000, 9% Debentures due to be redeemed out of profits on 1st October, 2015 at a premium of 5%. The company had a Debenture Redemption Reserve of Rs. 4,14,000. Pass necessary Journal entries at the time of redemption. |
Answer» SOLUTION :
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| 76. |
X Ltd. invited applications for 1,000, 9% Debentures of Rs. 100 each at a discount of 6%. Applications for 1,200 debentures were received.Pro rata allotment was made to all theapplicants. Pass necessary Journal entries for the issue of debentures assuming that whole amount was payable with applications. |
Answer» Solution : NOTE: Question requires entires for ISSUE of Debenturs. Thus, ENTRY for writing off Discount on Issue of Debentures is not passed. |
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| 77. |
X Ltd., had issued Rs.8,00,000, 9% debentures which are due to be redeemed out of profits on 1st Oct. 2015 at a premium of 5%. The company had a Debenture Redemption Reserve of Rs.4,14,000. The Company invested the required amount in fixed deposit in a Bank on 30th April, 2015 earning interest at 10% p.a. Pass necessary journal entries for the redemption of debentures. |
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Answer» SOLUTION :Amount transferred to Debenture Redemption Reserve RS.3,86,000 on 31ST MARCH, 2015. Debenture Redemption Investment Rs.1,20,000 on 30th April, 2015, INTEREST received for five months Rs.5,000. Since the debentures are to be redeemed fully out of profits, debenture redemption reserve will be created with an amount equal to 100% of debentures redeemed. |
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| 78. |
X Ltd. Has a Current Ratio of 3 : 1 and Quick Ratio of 2 : 1. If the excess of current assets over quick assets as represented by stock is Rs. 40,000, calculate current assets and current liabilities. |
| Answer» SOLUTION :CURRENT ASSETS = RS. 1,20,000, Current LIABILITIES= Rs. 40,000. | |
| 79. |
X Ltd. Had issued Rs.10,00,000, 9% debentures which are due to be redeemed out of profits on 1st October 2018 at a premium of 5%. The company had a Debenture Redemption Reserve of Rs.4,14,000. It was decided to invest the required amount in Debenture Redemption Investment. Pass necessary journal entries for the redemption of debentures. |
Answer» Solution : Notes : (1) SINCE the debentures are to be redeembed purely out of PROFITS, an AMOUNT equal to 100% of DEBENTURE redeemed i.e., Rs.10,00,000 is transferred to Debenture Redemption Reserve. If such Reserve is created only with 25%of the total amount of debentures redeemed, it would mean that remaining 75% of the debentures have been redeemed out of CAPITAL. 
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| 80. |
X Ltd. Forfeited 2,000 hares of Rs 10 each (which were issued at par) held by Naresh for non-payment of allotment money of Rs 4 per share. The called-up value per share was Rs 9. On forfeiture, the amount debited to Share Capital Account will be |
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Answer» RS 10,000 |
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| 81. |
X Ltd . Forfeited 2,000 shares of Rs.10 each (which were issued at par) held by naresh for non - payment of allotment money of Rs.4 per share . The called - up value per share was Rs.9. On forfeiture, the amount debited to shares Capital Account will be |
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Answer» Rs.10,000. |
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| 82. |
X Ltd. acquired assets of .Rs 20 lakhs and took over creditors of .Rs 20 thousand from Y Ltd. X.Ltd. Issued 8% debentures of .Rs 200 each at a discount of 10% as purchase consideration. Number of debentures issued will be : |
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Answer» `11,000` |
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| 83. |
X Limited offed to the public 10,000 equity shares of Rs. 10 each at a premium of Rs. 2 per share payable as follows : On application Rs. 3, On allotment (including premium) Rs. 4, On first call Rs. 3 and on second and final call Rs. 2. Applications were received for 15,000 shares. All applications were placed under four categories and allotment was made as follows : {:("Category A : to applicants of 4,000 share","in full"),("Category B : to applicants of 6,000 share","4,000 shares"),("Category C : to applicants of 3,000 shares","2,000 shares"),("Category D : to applications of 2,000 shares","Nil"):} Except in the cases where applications were wholly rejected, excess application money was not to be refunded to be adjusted against moneys due on allotment and calls. A, an applicant under category B to whom 400 shares were allotted failed to pay the allotment money and on his failure to pay the first call his shares were forfeited. B, an applicant under category C to whom 300 shares were allotted failed to pay both the calls and his shares were also forfeited. 500 of the shares thus forfeited were re-issued to C as fully paid for Rs. 8 per share. Show Cash Bok, Journal entries and prepare the Balance Sheet in the books of the company, you are to assume that the whole of the A's shares were issued to C. |
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Answer» SOLUTION :CASH RECEIVED on allotment Rs. 30,000, Balance of Share Forfeiture A/c Rs. 1,000, Capital Reserve Rs. 1,300, Securities PREMIUM Reserve Rs. 19,200, Cash at Bank Rs. 1,19,500, Balance Sheet Total Rs. 1,19,500. HINT : Premium will be debited at the time forfeiture of A's Shares. |
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| 84. |
X and Y were partners sharing profits in the ratio of3:2 . Give Journal entries under following situation at the time of dissolution of firm : (i) Workmen Compensation Reserve in the Balance Sheet was ₹ 75,000 and there was no liability towards Workmen Compensation . (ii) Workmen Compensation Reserve was ₹ 60 , 000 and liability was ₹ 75, 000 . (iii) Workmen Compensation Reserve was ₹ 60, 000 and liability was ₹ 75 , 000 . (iv) Workmen Compensation Reserve was ₹60 , 000 and liability was ₹ 60 , 000 . (v) Workmen Compensation Reserve was nil and liability was ₹ 15 , 000 . |
Answer» SOLUTION :
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| 85. |
X andYare partner in a firmsharingprofitin theratio of 4:1 theydecidetoadmit Z, theirmaggeras a partner witheffectfrom2atapril, 2018 for 1/8 thsharein profit,Z asa manager ,wasgettingsalaryfo Rs.8,000 per monthandcommissionof5%of thenet profits afterchargingsuch salaryandcommission . As perthetermsof thepartnershipDeedany excess amountwhichZshallbeentitled toreceiveas apartner overthe amountwhichhavebeen dueto himas amanager , would bebornebyX outof hisshareof profit.profitfor theyearended31 st march, 2019Amountedto Rs. 13.56.000beforesalary andcommissionpreparetheprofitand loss approperiationAccountfor thepeiod ending31 st March , 2019 |
Answer» Solution : workingnote :`{:("distributionof PROFIT before admissionof Z as a PARTNERS: ",Rs,Rs),("profitbeforemanger'sSalary and COMMISSION ",,13.56.000),("LESS :AmountDueto Z asManager:" ,,),("Salary (Rs. 8.000"xx"12)",96.000,),( "Commission[5//105(Rs. 13.56.000-Rs. 96.000]",underline (60.000),1.56.000),( "Net DivisibleProfit ",,underlineunderlineoverline (12.00.000)),( "X'ssharein profit =Rs. 12.00.000"xx"4/5=Rs.9.60.000,and",,),("Y'shasin profit=Rs. 12.00.000 "xx"1/5=Rs.2.40.000",,):}` As Zhas been ADMITTED as apartner , heis notentiledto getsalaryof Rs.96,000andcommisionof Rs. 60.000 Instead he willget1 / 8thsharein theprofit=Rs.13.56.000 `xx` 1/8 =RS. 1.69.500 . thedeficiencyfo Rs.13.500 (i.e., 1.69.500-Rs. 1.69.500-Rs. 1.56.000 ) willbeborneby Xpersonallly .thusFinalsharein profit: X'sshare=Rs. 9.60.000 -Rs. 13.500 =Rs.9.69.500,Y 's share=Rs. 2,40,000, andZ'sshare =Rs. 1,69,500. |
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| 86. |
Xand Ystartedbusinesson 1stApril, 2018 withcapitalsof Rs. 5.00.000 eachasperthepartnershipDeedbthX and yare togetMonthlysalary of Rs. 10.00.000, interestin capitals@ 10%p.aDrawing s duringthe yearwere X- Rs. 60.000 andY- Rs. 1.00.000, intereston srawingbeingcharged @ 10 %p.a Duringthefrimincurred a lossof Rs. 2.00.000. passjournalenterisfor theaboveand prepare profitand lossappropritaionAccount , thefirm losesitsAccoutnson 31st March. everyYear. |
Answer» SOLUTION : 1, in the absenceof datesof drawings, intereston has beencalculatedfor theaverage periodof6 monthsthus . intereston X'S Drawings `=Rs. 60,000xx10//100xx6//12=Rs. 3,000,` INTEREST on Y'sDrawings =Rs. 1,00,000xx10//100xx6//12=Rs. 5,000.` 2. SALARYTO partnersandintereston capitals are not allowedbeceusethe firmhas incurredloss . |
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| 87. |
XandYshared profits and losses in the ratio of3:2 With effect from 1st April , 2019, they agreed to share profits equally . Goodwill of the firm was valued at Rs. 60,000.The necessary single adjustment entry will be : |
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Answer» DR. CAPITAL A/c and CR,X's Capital A/c with RS. 6,000. |
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| 88. |
Xand Y shared profits and losses in the ratio of 3 :2. With effect from 1st April, 2019 they agre share profits equally. The goodwill of the firm was valued at ₹60,000. The adjustment entry will be : |
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Answer» Dr.Yand CR.X with ₹6,000. |
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| 89. |
X and Y share profits in the ratio of 3:2.Z wad admitted as a partner who sets 1/5 share. New profits sharing ratio, if Z acquires, if Z acquires 3/20 from X and 1/20 from Y would be: |
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Answer» `9:7:4` |
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| 90. |
X and Yenteredinto partnership on 1st April ,2017theircapitals as on 1st April,2018wereRs. 2,00,000 andRs. 1,50,000 respecttivalyon 1st October,2018X gaveRs, 50,000as loanto thefirmAs per theprovisionsof the partnership Deed : (i )20%of profitbefore chargingintereston drawings butaftermakingappropriationwasto betransferred o general Reserve .(ii)intereston capital at 12% p.a andintereston drawing@10% p.a(iii)X to get monthlysalaryofRs. 5,000and Yto getsalaryfo Rs. 22,500 perquarter . (iv)X is entitledto a commissionof 5%on salessalesforthe yearwereRs. 3,50,000 (v)profitto be sharedin theratioof thiercapitals up to Rs. 1,75,000andbalanceequallyprofitfor theyearended31st March,2019beforeallowingor charginginterestwas Rs.4,61,000thedrawings of Xand YwereRs., 1,00,000and Rs, 1,25,000respectively passthe necessaryjournalenterisrelatingtoappropritaionoutprofit prepareprofit and Lossappropriation Account and thepartners capitals accounts . |
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Answer» x0-Rs. 17,500 ; interest on Drawings s;X-Rs. 5,000 ;Y -Rs. 6,250; share OFPROFIT ;X-Rs. 1,18,125; Y- Rs. 93,125 ; Capital Balance ;X-Rs. 3,14,625 ;Y Rs. 2,19,875; intereston X'sLoan;Rs. 1,500 transferto generalreserve-Rs, 50,000. |
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| 91. |
X and Yare partnesrs in afirmXisto get commissionof 10 %of net profitbeforecharginganycommissionY is togeta com missionof 10%on netprofitagtercahrgingall commissions .Netprofitfor the yearended31stMarch,2019wasRs. 55.000 Findthecommissionof X and YAlsoshowthedistribution of profit . |
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Answer»
NOTE :-the abovestated amountof Y'scommissioncan beverifiedAfterchargingcommissionsnetprofitcomesto Rs. 45.000 [i.e.,Rs. 5.500+Rs.4.500)] thereforeY'scommission@ 10%of Rs. 45.000. |
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| 92. |
X and Yare partnessharingsprofitsin theratioof 3:2 withcapitals of Rs. 8,00,000and Rs. 6,00,000Respectivelyinterestcapital isafreed @5%p.aYis tobeallowedan annualsalaryfo Rs. 6,00,000 whichhasnotbeenwithdrawn , profitfor theyearended 31st March,2019 beforeintereston capital but after chargedchargingY'sSalary amounted to Rs, 2,40,000 A provisionsof 5%of theprofitis bemadein respectof commissionto themagagerprepanean aaccountshowingthe allocation of profits . |
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Answer» |
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| 93. |
X and Y are partners. Y wants to admit his son K into business. Can K become the partner of the Firm? Give reason. |
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Answer» Solution :K, cannot BECOME th epartner of the FIRM. Reason: As per Section 31(1) of the Indian PARTNERSHIP ACT, 1932, a person can be admitted as a partner only with the consent of all the existing partneers unless otherwise agreed upon. |
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| 94. |
X and Y arepartnerssharingsprofitsand lossesin theratioemployedZ astheirmanagertoehomtheypaida salary of Rs. 7,500 permonth Z haddepositedRs. 2,00,000onwhichinterestwas payble@9% p.aAtthe endof theaccounting year (i,e., 31stMarch 2018 ) 2017 -18(after divisionof theyear'sprofits )itwas decidedthat Z shouldbe treatedas apartner withfrom 1st April2014with1/6 th shareof profits hisdepositbeing consided as capitalcaryyinginterest@65 p. a likecapitals of otherpartners the firm'sprofitsand losses afterallowing intereston capitals were - 2014-15: profit Rs. 5,90,000,2015-16: profitRs. 6,26,000: 2016 -17: lossRs. 40,000and 2017-18 , profit Rs, 7,80,000 recordnecessaryjournalon capitalentriesto giveeffectto theabove . |
| Answer» SOLUTION :debitXby RS, 3,600 Y by Rs, 2,400andcreditZ by Rs, 6,000 | |
| 95. |
X and Y are partners with capitals ofRs6,50,000 andRs5,50,000 respectively. They admit Z as a partner with 1/4th share in the profit of the firm. Fill in the missing figures torecord capital and goodwill: |
Answer» Solution : Working Notes: (i) Total CAPITAL of the Firm on the basis of Z's Capital `=Rs6,50,000 XX 4//1 =RS 26,00,000` (ii) Acutal Capital of NEW Firm `=Rs6,50,000 +Rs 5,50,000+Rs 6,50,000 =Rs 18,50,000` (III) Firm's Goodwill [(i)-(ii)] =Rs 26,00,000-Rs 18,50,000 =Rs 7,50,000 Z's Share of Goodwill `=Rs7,50,000 xx 1//4=Rs 1,87,500.` |
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| 96. |
X and Y are partners sharing profits losses in theratio of 5:3:2. Theydecide to share future profits and losses in the ratio of 2:3:5 witheffectfrom1st April, 2019. Followingitems appear in theBalance sheet as a 31st March, 2019: {:(,,"₹",,"₹"),(,"Genral Reserve","75,000","Advertisement Suspense A/c (Dr.)","50,00"),(,"Workmen Compenstion Reserve ","12,500","Profit andLoss Account(Cr.)","37,500"):} |
Answer» SOLUTION :
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| 97. |
X andY arepartners sharingprofitsin the ratioof 2:1 . On31st March, 2019, theirBalancesheet showedGenral Reseve of ₹60,000. It wasdecided that in future they willshare profitsthey willshare profits andlosses in theratioof 3:2 .Pass necessary Journal enrtryin eachof the followingalternativecases: (i) WhenGeneralReserveisnotto be shownin thenewBalance Sheet. (ii)When General Reserve is tobe shown in theshown in thenew Balance Sheet. |
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Answer» |
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| 98. |
X and Yarepartners sharingprofits in theratio of 3:2 On 31 stMarch.2019afterclossingthebooks ofaccount theircapitalsare Rs, 10.00.000andRs. 12.50.000 respectively,On1stMay2018X hadintroducedan additionalcapaitalof rs. 12.50.000RepectivelyOn .1stMay2018X hadintroduced2018Xhad introducedan additional capital of Rs. 2,50,000and Y withdrew RS. 1,25,000formhis cpital on 1st october , 2018 x, withdew Rs. 5,00,000fromhiscapitaland Yintrouced Rs, 6,25,000 Afterclosing the accounts , it wasnoticedthatintereston capital@6% p.ahas been omitteed During the year ended 31st MArch ,2019 X's drawing and Y'sdrawigs were RS. 2,50,000 and Rs. 1,25,000 profits (before intereston capital ) during the yearwere Rs. 5,00,000 Calculate intereston capitalif thecapitalsare (A) fixed and (b)Fluctuating |
Answer» SOLUTION : (B)whencapitalsareFluctating : 
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| 99. |
X and Y are partners sharing profits in the ratio of 2 : 1. They admit Z into the parnership for 1/4th share in profits for which he brings in RS. 20,000 as his share of capital. Hence, the adjusted capital of X and Y will be |
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Answer» RS.40,000 and RS.20,000 RESPECTIVELY. |
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| 100. |
X and Yarepartnerssharing profitsand lossesin theratioof 2:3withcapitalsof2,00,000 andRs. 3,00,000respectivelyon1stoctober, 2018X and Ygaveloans of Rs. 80,000andRs,. 40,000respectively to the followingalternativecases : Case1. if theprofitbefore interestfor the yearamounted to Rs. 21,000 . Case 2.if theprofit beforeinterestfor theyearamountedto Rs. 3,000. Case 3.if theprofits before interestfo theyear amounted to Rs. 5,000. case 4.if thelossbeforeinterestfor theyearamounted to Rs. 1,400. |
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Answer» |
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