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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.
| 1451. |
Mohan and Shyam are partners in a firm. State whether the claim is valid if the partnership agreement is silent in the following matters: (i) Mohan is an active partner. He wants a salary of Rs. 10,000 per year, (ii) Shyam had advanced a loan to the firm. He claims interest@ 10%per annum, (iii) Mohan has contributed Rs. 20,000 and Shyam Rs. 50,000 as capital. Mohan wants equal share in profits. (iv) Shyam wants interest on capital to be credited@ 6% per annum. |
| Answer» SOLUTION :(i) Invalid, (ii) Invalid, (III) VALID, (iv) Invalid | |
| 1452. |
Mohan and Mahesh were partners in a firm sharing profits in the ratio of 3:2. On 1st April, 2012, they admitted Nusrat as a partner in the firm. The Balance Sheet of Mohan and Mahesh on that date was as under. It was agreed that: (i) The value of Building and Stock be appreciated to Rs 3,80,000 and Rs 1,60,000 respectively (ii) The liavilities of Workmen's Compensation Fund was determined at Rs 2,30,000. (iii) Nusrat brought in her share of goodwill Rs 1,00,000 in cash. (iv) Nusrat was to bring further cash as would make her capital equal to 20% of the combined capital of Mohan and Mahesh after above revaluation and adjustments are carried out, (v) The future profit-sharing ratio will be Mohan 2/5th, Mahesh 2/5th, Nusrat 1/5th. Prepare Revaluation Account, Partners' Capital Account and Balacne Sheet of the new firm. Also show clearly the calculation of Capital brought by Nusrat. |
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Answer» Solution :Gain (Profit) on Revalution-Rs 1,40,000, Partners' CAPITAL Accounts, Mohan-Rs 3,92,000, Mahesh-Rs 2,08,000, Nusrat-Rs 1,20,000, Balance SHEET Total-Rs 11,60,000. NOTE: Amount of GOODWILL has been credited to Mohan's Capital ACCOUNT since only he has sacrificed his share of profit. |
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| 1453. |
Modern Ltd. with paid-up share capital of Rs. 10,00,000 has a balance of Rs. 2,50,000 in Securities Premium Reserve Account. Suggest the method for utilising Securities Premium Reserve that would maximum the return to shareholders. |
| Answer» Solution :Securitiespermium reserve can be utilisedin ACCORDANCEWITH the provisions of Section 52(2) of Companies Act, 2013. The management may utilise the securities premium reserve of Rs. 2,50,000 by issue of FULLY PAID bonus shares to the shareholders in the ratio of 1:4 (i.e, one bonus share for every four shares held). | |
| 1454. |
Modern Ltd. issued a prospectus inviting applications for 2,00,000 shares of Rs. 10 each at a premium of Rs. 6 per share, payable as follows : {:("On Application","Rs. 5 (including premium Rs. 2)"),("On Allotment","Rs. 5 (including premium Rs. 2)"),("On Ist Call","Rs. 3 (including premium Rs. 1)"),("On IInd & Finasl Call","Rs. 3 (including premium Rs. 1)"):} Applications were received for 2,60,000 shares and pro-rata allotment was made to the applicants for 2,50,000 shares. Excess money paid on applications for these shares was utilised towards allotment. A, who applied for 1,000 shares, failed to pay the allotment money and his shares were forfeited after allotment. B, who applied for 1,500 shares, failed to pay the two calls and his shares were also forfeited. Of the shares forefeited, 1,800 shares were re-issued as fully paid up for Rs. 15 per shares, the whole of B's share being included. Prepare Cash Book and Journal. |
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Answer» Solution :Cash at BANK RS. 32,12,000, Cash received on allotment Rs. 7,47,000, Balance of Share FORFEITURE A/c Rs. 850, CAPITAL Reserve Rs. 9,750, Balance of Securities Premium Reserve A/c Rs. 12,03,400. Hint : Securities Premium Reserve A/c will be debited from Rs. 1,600 at the time of forfeiture of A' s SHARES and from Rs. 2,400 at the time of forfeiture of B' s shares. |
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| 1455. |
Mitali, Indu and Geeta are partners sharing profits and losses in the ratio of 5 : 3 : 2 respectively. On March 31, 2017, their Balance Sheet was as under:Geeta retires on the above date. It was agreed that Machinery be valued at Rs. 1,40,000, Patents at Rs. 40,000, and Buildings at Rs. 1,25,000. Record the necessary journal entries and Prepare the Revaluation Account. |
Answer» SOLUTION : 
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| 1456. |
Mita and ushaarepartners in afirmsharing profitsin theratioof 2:3heircapitalAccountsas on 1st April,2015 showedbalances of Rs.1,40,000andRs. 1,20,000 respeceively, thedrawingof mita andushaduring the year2015-16were Rs. 32,000 and Rs. 24,000respectievly boththeamounts werewithdrawnon1s january2016 ,itwassubsequentlyfoundthat thefollowingiterms hadbeen omitted whilepreparingth e finalaccountsfor thethe yearended31st March2016 (a)interestoncapital@6% p.a (b) interest on drawings @6% p.a ( C)mita was entitled to a commissionfo Rs. 8,000 for thewholeyearshowing yourworkingcleasrlypassa rectifity passa rectifyingentryin the books of the firm . |
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| 1457. |
MIG Ltd. Forfeited 40 shares of Rs.10 each issued at a premium of 4% to Raj had applied for 48 shares . After having paid Rs. (including Rs.2 premium), he did not pay allotment money of Rs.2 (including Rs.1premium) and on his subsequent failure topay the first call of Rs. 3 (including Rs. 1 Premium ) his shares were forfeited. the amount to credited to Forfeited shares Account is |
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Answer» Rs.288. |
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| 1458. |
Mining Right are |
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Answer» TANGIBLE FIXED ASSETS |
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| 1459. |
Mian Bank Ltd . Issued 1,00,000 , 9% Debentures of Rs.100 each for subscription . Issue was subscribed . Theamount of receipt will be shown as |
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Answer» OPERATING ACTIVITY. |
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| 1460. |
MIG Ltd. Forfeited 40 shares of Rs 10 each issued at a premium of 40 % to Raj who pad applled for 48 shares. After having paid Rs 6 (including Rs 2 premium), he did not pay allotment money of Rs 2 (including Rs 1 premium) and on his subsequent failure to pay the first call of Rs 3 (including Rs 1 premium) his shares were forfeited. The amount to be credited to Forfeited Share Account is |
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Answer» RS 288 |
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| 1461. |
Mention the net amount of 'Source' or 'Use' of cash when a fixed asset having book value of Rs 15,000 is sold at a loss of Rs 5,000. |
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Answer» USE RS 5,000 |
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| 1462. |
Mention, in brief, SEBI Guideline regarding Debenture Redemption Reserve. |
| Answer» Solution :As PER SEBI Guidelines, a COMPANY shall create DRR equivalent to at least 25% of the AMOUNT of debentures issued before starting the REDEMPTION of debentures. | |
| 1463. |
Mention four iterns of Current Assets and two items of Current Liabilities. |
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Answer» Solution : CURRENT Assets: 1.Stock, 2. Debtors, 3.Cash in Hand,4.Prepaid Expenses. Current LIABILITIES: 1. Bank Overdraft, 2.SundryCreditors |
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| 1464. |
Mention any two items of Contingent Liability of a company. |
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Answer» SOLUTION :(i) CLAIMS against company that are not accepted. (II) Proposed DIVIDEND for the Current Year. |
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| 1465. |
Meena Ltd. issued 60,000 shares of Rs. 10 each at a premium of Rs. 2 per share payable as Rs. 3 on Application, Rs. 5 (Including Premium) on allotment and the balance on first and final call. Applications were received for 1,02,000 shares. The Directors resolved to allot as follows : (A) Applicants of 60,000 shares - 30,000 shares (B) Applicants of 40,000 shares - 30,000 shares (C) Applicants of 2,000 shares - Nil Nikhil who had appled for 1,000 shares in category A, and Vish who was allotted 600 Shares in category B failed to pay the allotment money. Calculate the amount received on Allotment. |
Answer» SOLUTION :
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| 1467. |
Manvet Ltd. Invited applications for issuing 10,00,000 equity shares of Rs. 10 each payable as follows : On application and allotment Rs. 4per share (including premium Rs. 1), 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 calls. A shareholder who had applied for 6,000 shares did not pay the first, and the second and final call. His shares were forfeited. 90% of the forfeited shares were reissued at Rs. 8 per share fully paid up. Pass necessary journal entries for the above transactions in the books of the company. |
Answer» Solution :  Working Notes: (1) (A) Applicant for 6,000 shares must have been ALLOTED `(10,00,000)/(15,000,000) xx6,000` `=4,000` shares Excess AMOUNT recieved from him on application =6,000 Shares - 4,000 Shares =2,000 Shares x Rs 4 =Rs 8,000 
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| 1468. |
Manvet Ltd. invited applications for issuing 10,00,000 equity shares of Rs. 10 each payable as follows: {:("On application and allotment",-,"Rs. 4 per share (including premium Rs. 1),"),("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 calls. A shareholder who had applied for 6,000 shares did not pay the first, and the second and final call. His shares were forfeited. 90% of theforfeited shares were reissued at Rs. 8 per share fully paid-up. Pass necessary Journal entries for the above transactions in the books of the company. |
Answer» SOLUTION :  1. CALCULATION of first call money not received: Number of shares allotted to the defaulting shareholder = `(10,00,000)/(15,00,000) xx 6,000 = 4,000` shares: `{:("Excess APPLICATION and Allotment money received (2,000"xx"Rs.4)=Rs.8,000",,Rs.),("First call money due (4,000"xx"Rs.4)",,"16,000"),("Less: Excess Application and Allotment Money adjusted",," 8,000"),("First Call Money due but not received",,bar(ul(ul(8,000)))):}` `{:(" 2. Calculation of first call money received later:",,Rs.,,Rs.),("First call money due (10,00,000"xx"Rs. 4)",,,,"40,00,000"),("Less: Excess Application and Allotment money adjusted on call",,"20,00,000",,),("Money not paid by defaulting shareholder(WN 1)" ,,ul(""8,000),,ul(20,08,000)),(,,,,ul(ul(19,92,000))):}` `{:(" 3. Calculation of gain on reissue of forfeited shares to be ransferred to Capital Reserve:",,Rs.),("Amount forfeited on forfeited shares (Rs.20,000/4,000"xx"3,600)",,"18,000"),("Less: Reissue DISCOUNT (3,600"xx"Rs. 2)",," 7,200"),("Gain on reissue to be transferred to Capital Reserve",,bar(ul(ul(10,800)))),(,,):}` |
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| 1470. |
Manu, Harry and Ali are partners in a firm sharing profits and losses equally. Harry and Ali withdrew the following amounts from the firm, for their personal use, during 2015. Calculate interest on drawings if the rate of interest to be charged is 10 per cent, and the books are closed on December 31 every year. |
Answer» Solution :  Amount of Interest `"MANNU"=Rs. (1","56","000xx10xx1)/(100xx12)=Rs. 1","300` `"ALI"=Rs.(1","50","000xx10xx1)/(100xx12)=Rs. 1","250` |
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| 1471. |
Mannu andshrishi are partnersin firmsharingprofitsin theratioof 3:2 following informationis of thefirm as on31st March2019 . profitfor theyear ended31st March,2019was Rs. 5,000whichwasdividedin theagreed ratio but interest@2%p.aon capital and@6%p,aon drawingswasindvertentlyomitteed Adjustintereston drawingson anaveragebasisfor6 monthsGivethe adjustmententry . |
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| 1472. |
Mannu andShrishi arepartners in a firm sharing profits in theratioof 3:2 Followingis theBalancesheet of thefirm as on 31 St March ,2019: Profitfor theyearended31st March , 2019 Was Rs.5,000whichwasdivided in theagreed ratio ,butinterest @5%p.aon capitaland6%p.a on drawingsWasindvetently omittedintereston drwingson anaveragebasisfor6 months Givethe adjustemententry . |
Answer» SOLUTION : Working Notes : 1.For thecalculationof intereston capital ,openingcapitaliscalculated .  Forcalculatingopeningcapital,drawings areHowever ,Drewings of MANNU andshristhi appearin THEBALANCESHEET, itmeans thattheircapital Accountshavenot beenadjustementfor dreawingstherefore, theirdrawingshavenotbeenaddedback . 2. Calculationof intereston Drawings: Datesof drawingsarae not giventhereforeintereston drewings willbechargedfor theaverageperiodi.e.,6 MONTHS interestOn Drawngs: Mannu =Rs. 4,000`XX`6/12`xx`6/100=Rs.120,shristhi `=Rs. 2,000xx6/12xx6//100`=Rs. 60. 
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| 1473. |
Mandeep, Vinod and Abbas are partners sharing profts and losses in the ratio of 3:2:1. From 1st April,2019 they decided to share profis equally. The Partnership Deed provides that in the event of any change in profit-sharing ratio, goodwill shall be valued at three years' pruchase of average profit of last five years. The profits and Iosses of past five years are Profit-Year erded 31st March, 2015 - ₹1,00,000,2016 - ₹1,50,000, 2018- ₹2,00,000, 2019- ₹2,00,000. Loss-Year ended 31st March, 2017- ₹50,000. |
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| 1474. |
Mala, Neela and Kala were partners sharing profits in the ratio of 3:2:1. On 1st March, 2015, their firm was dissolved. The assets were realised and liabilities were paid off. The accountant prepared Realisation Account, Partners' Capital Accounts and Cash Account, but forgot to post few amounts in these accounts. You ar required to complete these below given accounts by posting correct amounts. |
Answer» SOLUTION :  Notes: 1. Loss on reallisation of Rs 18,000 is CALCULATED as the BALANCING figure of Realisation Account. This loss is distributed among the partners in their profit-sharing ratio, i.e., `3:2:1.` and debited to their Capital Account . 2. Investment is taken by MALA of Rs 2,000. This amount is transferred from realisation Account to the debit of her Capital Account. 3. Sheela's Lone of Rs 13,000 (a liability) is taken by Mala. This amount is credited to her Capital Account. 4. Realisation Expenses credited to Cash Account. |
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| 1475. |
Main source of Income for a Not - for Profit Organisation is |
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Answer» Rent. |
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| 1476. |
Main objective of analysis of financial statements is |
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Answer» To KNOW thefinancial strength |
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| 1477. |
Main source of Income for a Not-for -Profit Organisation is |
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Answer» Rent |
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| 1478. |
Main limitation of financial analysis is : |
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Answer» To KNOW earning capacity |
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| 1479. |
Main Bank Ltd. Issued 1,00,000, 9% Debentures of Rs 100 each for subscription. Issue was subscribed. The amount of receipt will be shown as |
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Answer» OPERATING ACTIVITIES |
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| 1480. |
Main limitation of analysis of financial statements is |
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Answer» AFFECTED bywindow dressing |
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| 1481. |
Mahesha partherin M/sMsH &co .,hasadvanced loanof Rs.1,00,000 to thefirm,Rateofinterestwasnotdecided butMahesh Demandsinterest@12%p.a at theyearendgivingthe reasnthat hetakenloanformBank @12% p.aNaresh, theotherpartner,doesnotagreeto payinterest, whointerestwhois correctand Why ? |
| Answer» SOLUTION :Both mahesh ans Naresh are incorrectin the absenceof PARTNERSHIP Deed the indian partnersship Act 1932 will applyit providesthatinterestthatinterest @6% p.a will be paidon partners 's loanin theabsence of partnershipDeedthereforemahesh is notcorrectin DEMANDING interest@12% p.a andnaresh in not correct in denying interest . | |
| 1482. |
Mahadev Ltd., with an authorised capital of Rs. 5,00,000 divided into 50,000 equity shares of Rs. 10 each, issues the entire amount of the shares payable as follows : Rs. 5 on Application (including premium of Rs. 3 per share) Rs. 4 on Allotment, and Rs. 4 on Call. All share money is received in full with the exception of the allotment of 200 shares and the call money on 500 shares (including the 200 shares on which the allotment money has not been paid).The above 500 shares are duly forfeited 400 of these (including the 200 shares on which allotment money has not been paid) are re-issued at Rs. 8 per share as fully paid up. Pass journal entries (including cash transactions) and show the balances in the Balance Sheet giving effect to the above transactions. |
| Answer» SOLUTION :Share CAPITAL Rs. 4,99,600, Capital Reserve Rs. 800, SECURITIES PREMIUM Reserve Rs. 1,50,00, CASH at Bank Rs. 6,50,400. | |
| 1483. |
Madhur Ltd.took over the assets of Rs. 3,90,000 and liabilities of Rs. 40,000 of Rasova Ltd. for a consideration of Rs. 4,00,000. 20% was paid by a cheque andthebalance byissue of fully paid equity shares of Rs. 100 each at a premium of 60%. Show necessary Journall entries for these transactions in the books of Madhur Ltd. |
Answer» Solution : Note: NUMBER of EQUITY SHARES to be ISSUED = `(Rs. 3,20,000)/(Rs.(100+60))=2,000` shares. |
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| 1484. |
Madhu, Neha and Tina are partners sharing profits in the ratio of 5:3:2. Calculate new profit sharing ratio and gaining ratio if1. Madhu retires2. Neha retires3. Tina retires. |
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Answer» Solution :GIVEN old ratio among Madhu : NEHA Tina as `5 : 3: 2` 1 If Madhu retires, NEW profit sharing Ratio between Neha and Tina will be Neha : Tina = `3 : 2` and GAINING Ratio of Neha and Tina = `3 : 2` 2. If Neha retires new profit sharing Ratio between Madhu and Tina will be Madhu : Tina = `5 : 2` Gaining Ratio of Madhu and Tina = `5 : 2` 3. If Tina retires, new profit sharing ratio between Madhu and Neha will be: Madhu : Neha = `5 : 3` Gaining ratio of Madhu and Neha = 5 : 3` |
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| 1485. |
Maanika, Bhavi and Komal are partners sharing profits in the ratio of 6:4:1. Komal is guaranteed a minimum profit of ₹ 2,00,000. The firm incurred a loss of ₹22,00,000 for the year ended 31st March,2018. Pass necessary journal entry regarding deficiency borne by Maanika and Bhavi and prepare Profit and Loss Appropriation Account. |
Answer» SOLUTION : Working NOTE: Loss of the firm : 22,00,000 Komal's share of loss =`22,00,000xx1//11=2,00,000` Guaranteed MINIMUM PROFIT =2,00,000 |
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| 1486. |
M/s ABC&co . Isadvisedto dibit salaryandcommission, whoof partnersto thepartnersto theprofitand lossApptopriationAccount, whydo youthinkthatitshuldnotbedebitedto theprofitandLossAccount ? |
| Answer» SOLUTION :SALARY and commissionto PARTNERS is anappropriationof profitand nota chrgeit is because of this reason that the profit and LOSS appropriation account shouldbe debited | |
| 1487. |
Luxor pens Ltd. Issued 10,000, 7% Debentures of Rs.100 each at a discount of Rs.4 redeemable at a premium of Rs. 6 .It will write off Loss on Issue of Debentures |
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Answer» from SECURITIES PREMIUM Reserve. |
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| 1488. |
Luxor Pens Ltd. Issued 10,000, 7% Debentures of Rs 100 each at a discount of Rs 4 redeemable at a premium of Rs 6. It will write off Loss on Issue of Debentures |
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Answer» from SECURITIES Premium Reserve |
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| 1489. |
Loss on sale of Marketable Securities debited to Statement of Profit and Loss will |
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Answer» be added to NET profit before TAX and extraordinary items and REDUCED from Cash and Cash EQUIVALENTS |
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| 1490. |
Loss on sale of Maeketable Securities debited to Stater of Profit Loss will |
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Answer» be ADDED to net PROFIT before tax and extraordinary ITEMS and reduced from Cash and Cash Equivalents. |
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| 1491. |
Lokesh, Mansoor and Nihal were partners in a firm sharing profits as 50% 30% and 20% respectively. On 31st March, 2014, their Balance Sheet was as follows: On the above date, mansoor retired and Lokesh and Nihal agreed to continue on the following terms: (i) Firm's goodwill was valued at Rs 1,02,000 and it was decided to adjust Mansoor's share of goodwill into the Capital Accounts of the continuing partners. (ii) There was a claim for Workmen's Compensation to the extent of Rs 12,000 and investments were brought down to Rs 30,000. (iii) Provision for Bad Debts was to be reduced by Rs 2,000. (iv) Mansoor was to be paid Rs 20,600 in cash and the balance will be transferred to his Lone Account wihic was paid in two equal instalments together with interest @10% per annum. (v) Lokesh's and Nihal's capital were to be adjusted in their new profit-sharing ratio by brining in or paying off cash as the case may be. Prepare Revaluation Account and Partner's Capital Accounts. |
| Answer» Solution :Manossor's Share of Goodwill = Rs `1,02,000xx3//10=Rs 30,600,` which is CONTRIBUTED by Lokesh and Nihal in their GAINING ratio, i.e., `5:2.` Loss on Revaluation-Rs 40,000, Partners' CAPITAL Nihal-Rs 4,286 and Cash WITHDRAWN by Lokesh-Rs 4,286. | |
| 1492. |
Loss on Issue of Debentures is written off : |
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Answer» In the YEAR of the issue of debentures |
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| 1493. |
Lokesh and Azad are partners sharing profits in the ratio 3:2, with capitals of Rs. 50,000 and 30,000, respectively. Interest on capital is agreed to be paid@ 6%p.a. Azad is allowed a salary of Rs. 2,500 p.a. During 2016, the profits prior to the calculation of interest on capital but after charging Azad’s salary amounted to Rs. 12,500. A provision of 5% of profits is to be made in respect of manager’s commission. Prepare accounts showing the allocation of profits and partner’s capital accounts. |
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| 1494. |
(Long-term Borrowings). Name any four items that are shown under Long-term Borrowings. |
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Answer» (ii) Term-loan from bank/other parties, (III) DEPOSITS, and (iv) Long-term LOANS and ADVANCES. |
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| 1495. |
Long term solvency is indicated by: |
| Answer» Answer :D | |
| 1496. |
Loans and advances granted' by a company will be considered, as which type of activity while preparing Cash Flow Statement. |
| Answer» SOLUTION :Loans and ADVANCES GRANTED' by a company will be considered as INVESTING activity. | |
| 1497. |
List the sub-headings which are shown under the heading 'Current Assets' in the Balance Sheet of a company as per Schedule III, Part I of the Companies Act, 2013. |
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Answer» Solution :(i) CURRENT Investments(ii) INVENTORIES (iii) TRADE Receivables(IV) Cash and Cash EQUIVALENTS (v) Short-term Loans and Advances(vi) Other Current Assets. |
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| 1498. |
List three items that are shown as Other Income in the case of non-financial companies. |
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| 1499. |
List three items that are shown under Other Current Assets. |
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| 1500. |
List the major heads of assets side of a company's Balance Sheet as per Schedule III, Part I of Companies Act, 2013. |
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