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 Series ARSP/06 Set ~ 6
Roll No. Q.P Code 15/6/6
Candidates must write the Q.P Code
on the title page of the answer-book.

 Please check that this question paper contains 10 printed pages.

 Q.P. Code given on the right hand side of the question paper should be written
on the title page of the answer-book by the candidate.
 Please check that this question paper contains 34 questions.
 Please write down the serial number of the question in the answer-book
before attempting it.
 15 Minute times has been allotted to read this question paper. The question
paper will be distributed at 10:15 a.m. From 10.15 a.m to 10.30 a.m, the students
will read the question paper only and will not write any answer on the answer –
book during this period.

ACCOUNTANCY

Time allowed: 3 hours Maximum Marks: 80

General Instructions:
1. This question paper contains 34 questions. All questions are compulsory.

2. This question paper is divided into two parts, Part A and B.

3. Question 1 to 17 and 27 to 29 carries 1 mark each.

4. Questions 18 to 20 and 30 to 32 carries 3 marks each.

5. Questions from 21 to 23 carries 4 marks each.

6. Questions from 24 to 26, 33 and 34 carries 6 marks each.

Part A
1. A ________ is a document evidencing a debit to be raised against a party for reasons other than sale on credit. [1]

a) credit note b) written note

c) debit note d) Oral

2. Assertion (A): Environmental protection groups are one of the multiple external users of accounting [1]
information.
Reason (R): Social responsibility groups want to know the impact of business on the environment and steps
taken by an enterprise for the protection of the environment.

a) Both A and R are true and R is the correct b) Both A and R are true but R is not the
explanation of A. correct explanation of A.

c) A is true but R is false. d) A is false but R is true.

3. Goods purchased on credit will increase the [1]

a) Debtor b) Capital

c) liability d) Drawings
4. Source Documents of Accounting are: [1]

a) Cheque b) All of these

c) Cash Memo d) Invoice and Bills

OR
Which equation is incorrect out of the following:

a) Liabilities = Assets - Capital b) Assets = Liabilities - Capital

c) Assets = Liabilities + Capital d) Capital = Assets - Liabilities

5. Which of the following statements about source document is incorrect? [1]
 i. They are required for audit and tax assessments.
ii. They do not serve as legal evidence in case of a dispute.
iii. These documents are written and authentic proof of the correctness of the recorded transaction.

a) only these documents are written and b) all of these

authentic proof of the correctness of the
recorded transaction.

c) They do not serve as legal evidence in case d) only they do not serve as legal evidence in
of a dispute and these documents are written case of a dispute
and authentic proof of the correctness of the
recorded transaction.
6. Accounting is ________. [1]

a) profit of business b) language of business

c) objective of business d) life of business

OR
Cost of Goods Manufactured is determined by:

a) Cost Accounting b) Human Resource Accounting

c) Financial Accounting d) Management Accounting

7. Profit on sale of fixed asset is used to create: [1]

a) Capital Reserve b) Specific Reserve

c) Reserve Capital d) General Reserve

8. Rule of Debit and Credit for Impersonal account is [1]

a) Dr. the receiver and Cr. the giver b) Dr. all expenses and Cr. all gains & Dr. what
goes out and Cr. what comes in

c) Dr. all expenses and Cr. all gains d) Dr. what goes out and Cr. what comes in
OR
Bank account is a:

a) Real account b) Nominal account

c) Personal account d) Revenue account

9. On inter-state (i.e., outside the state) purchase of goods, which of the following GST is levied? [1]

a) IGST b) IGST and CGST

c) SGST d) CGST
10. It is necessary to assume the Going Concern Concept as it [1]

a) Both bifurcate revenue expenditure b) Helps to bifurcate revenue expenditure

and capital expenditure

c) Helps to bifurcate capital expenditure d) Helps to bifurcate expenses

11. Which of the following does not correctly differentiate between revenue reserve and capital reserve? [1]
 a) Revenue reserve is created to strengthen the b) Revenue reserve is created out of revenue
financial position, to meet unforeseen profits where as capital reserve is created
contingencies or for some specific purposes. primarily out of capital profit.
Whereas capital reserve is created for
compliance of legal requirements or
accounting practices.

c) Workmen compensation fund d) Revenue reserve can be utilised only for a

specific purpose whereas capital reserve can
be utilised for any purpose.
12. Current Liabilities do not include [1]

a) Bills Payable b) Prepaid Insurance

c) Outstanding Salaries d) Sundry Creditors

13. The periodic total of Sales Return Journal is posted to the: [1]

a) Sales Account b) Sales Return Account

c) Goods Account d) Capital Account

14. Collection of account receivable will: [1]

a) Increase assets and decrease assets b) Decrease assets and Increase liabilities

c) Decrease assets only d) Increase assets and decrease liabilities

15. ________ represents the excess of assets over liabilities. [1]

a) Stock b) All of these

c) Capital d) Goodwill
OR
The expense that has been incurred but has not been paid is called:

a) Prepaid expenses b) Loss

c) Revenue d) Outstanding expenses

16. A separate column is made for Credit Note No. in [1]

a) Purchases Book b) Purchases Return Book

c) Sales Book d) Sales Return Book

17. Identify specific reserves from the following [1]
i. Dividend equalisation reserve
ii. Provision for depreciation
iii. Workmen compensation fund
iv. Investment fluctuation fund

a) (i), (ii) and (iv) b) (i) and (ii)

c) (i) and (iii) d) (i), (iii) and (iv)

18. What is an Account? [3]
OR
 Pass journal entries for the following transactions:
i. Bought goods from Raj of the list price of Rs 30,000 at 15% trade discount.
ii. Settled the account of Raj by paying cash, under a discount of 4%.
iii. Bought goods for cash of the list price of Rs 1,50,000 at 20% trade discount and 5% cash discount.
iv. Sold goods for cash of the list price of Rs 60,000 at 10% trade discount and 3% cash discount.
19. Explain the accounting principle of matching. [3]
OR
Explain the accounting principle of verifiability and objectivity of evidence.
20. Define the basic accounting terms with an example: [3]
i. Stock
ii. Business transactions
21. Following balances were extracted from the books of Ritesh on 31st March, 2023. You are required to prepare a [4]
Trial Balance. The amount required to balance should be entered as capital.

₹ ₹

Purchases 1,70,000 Drawings 7,700

Stock (1st April, 2022) 24,000 Returns Inward 3,500

Sales 1,05,000 Premises 5,28,000

Sundry Debtors 23,800 Sundry Creditors 16,100

Discount Received 3,500 Discount Allowed 2,800

Carriage Outwards 700 Carriage Inwards 1,400

Cash in Hand 3,500 Cash at Bank 17,500

Machinery 1,24,500 General Expenses 2,100

Provision for Depreciation on Machinery 24,200 Bad Debts Written off 2,450

Provision for Doubtful Debts 2,380

22. From the following transactions, prepare Cash Book with Cash and Bank columns: [4]
Feb. 1 Cash-in-hand Rs 7,500, Cash-at-bank Rs 8,000
Feb. 3 Discount a bill receivable for Rs 6,000 at 2% through Bank
Feb. 5 Bought goods for Rs 2,000 and paid by cheque
Feb. 15 Paid Trade expenses Rs 120
Feb. 16 Drew from Bank for office use Rs 1,000
Feb. 17 Sold goods for Rs 12,500 and received a cheque
Feb. 25 Paid Insurance Rs 100
Feb. 27 Cheque received on 17th deposited in Bank
Feb. 28 Received a cheque from John & Co. Rs 6,000
Feb. 28 Purchased 100 NSC for Rs 100 at Rs 95 each and paid by cheque.
23. On 31st December, 2023 my Cash Book showed a credit balance of ₹ 8,800. I had paid into Bank three cheques [4]
amounting to ₹ 6,000 on 24th December of which I found ₹ 3,200 have been credited in the Pass Book under
date 5th January 2024. I had issued cheques amounting to ₹ 8,000 before 31st December of which I found ₹
 2,500, have been debited in the Pass Book after 1st January 2024. I find a debit of ₹ 50 in respect of bank
charges in the Pass Book which I have adjusted in the Cash Book on 31st Dec. There is a credit of ₹ 360 for
interest on securities in the Pass Book which remains to be adjusted. A cheque of ₹ 1,200 deposited into bank
has been dishonoured. Prepare Bank Reconciliation Statement as on 31st Dec. 2023.
OR
A Bank Reconciliation Statement is prepared as on 31st March, 2023 starting with debit balance as per Cash Book.
State whether the following transactions will be shown in the Bank Reconciliation Statement by adding or deducting
these from the given balance giving reason:
i. Bank had wrongly debited the account by ₹ 25,000 on 1st March, 2023 and reversed on 3rd April, 2023.
ii. Receipts Side of the Cash Book was overcast by ₹ 500.
iii. Payments Side of the Cash Book was overcast by ₹ 5,000.
iv. Receipts Side of the Cash Book was undercast by ₹ 5,000.
v. Payments Side of the Cash Book was undercast by ₹ 20,000.
vi. Cheque for ₹ 10,000 issued but was not recorded in the Cash Book.
vii. A cheque of ₹ 5,000 deposited was not recorded in the Cash Book.
24. Pass necessary Journal entries for the following transactions: [6]

2023 ₹

April
Deposited in bank for opening a Current Account 10,000
1

April
Withdrawn from bank 5,000
2

April Received a cheque from Rohan to whom goods were sold for ₹ 12,000 last year. Allowed him
5 1% discount on payment

April
Rohan's cheque deposited in bank
7

April
Rohan's cheque dishonoured (bank charges ₹ 20)
9

April
Rohan settled his account by issuing cheque including ₹ 60 for interest 12,080
20

April
Cash directly deposited by Ram (Customer) in bank account 8,000
21

April
Bank draft got issued in favour of M/s Gupta & Sons ₹ 5,000. Bank charges ₹ 700
23

April
A cheque of ₹ 4,000 (due after one month) discounted from bank for ₹ 3,800
28

April
Received a cheque of ₹ 1,000 from Suraj after banking hours
30

April Goods sold for cash ₹ 7,000 and half of the sale proceeds deposited in bank
 30

OR
Pass Journal Entries for the following:
2023 March 2 Purchased an Iron Safe for business for ₹ 1,00,000 and payment made by cheque.
2023 March 3 Purchased filing cabinet for office use ₹ 40,000 and paid ₹ 200 as cartage on it.
2023 March 4 Purchased a Computer from Shyam & Co. for ₹ 80,000 on credit.
2023 March 5 Purchased an electric fan for ₹ 20,000.
2023 March 6 Purchased a Horse for business for ₹ 1,50,000 and payment made by cheque.
2023 March 7 Purchased Post Cards for ₹ 250; Envelopes for ₹ 500 and Stamps for ₹ 1,000.
2023 March 8 Purchased office stationery for ₹ 4,000.
2023 March 15 Gave as Charity - Cash ₹ 2,000 and Goods ₹ 4,000.
2023 March 20 The horse bought on March 6 died, its carcass was sold for ₹ 10,000.
2023 March 25 Sold household furniture for ₹ 1,00,000 and paid the money into the business.
2023 March 31 Paid to the landlord by cheque ₹ 1,20,000 for rent. One-third of the building is occupied by the
proprietor for residential use.
25. The accountant of a firm finds that the Trial Balances as on 31st March 2023 is out-by an excess debit of ₹ 283. [6]
He placed the amount in the Suspense Account. In the first week of April, 2023 he discovered the following
errors. Pass the Journal entries necessary to rectify these errors and show the Suspenses Account as it would
appear at the end of the week. Have you any comment to make?
i. Cash paid to Amit Verma, ₹ 75, was posted to the credit of Amit Kapoor's Account as ₹ 57.
ii. Discount allowed by Lokesh of ₹ 5 was not entered in the Cash Book, but Lokesh stands debited correctly.
iii. No entry was made for goods worth ₹ 40 taken away by proprietor for personal use.
iv. ₹ 500 received from Malhotra Sons, for interest on loan advanced to them were recorded in the Cash Book.
But the entry was not posted in the Ledger.
v. The total of Returns Outward Book was short by ₹ 100.
OR
Rectify the following errors assuming that suspense account was opened. Ascertain the difference in trial balance.
a. Depreciation provided on machinery ₹ 4,000 was not posted to depreciation account.
b. Bad debts written-off ₹ 5,000 were not posted to debtor's account.
c. Discount allowed to a debtor ₹ 100 on receiving cash from him was not posted to discount allowed account.
d. Goods withdrawn by proprietor for personal use ₹ 800 were not posted to drawings account.
e. Bill receivable for ₹ 2,000 received from a debtor was not posted to bills receivable account.

26. Arora Construction Ltd purchased a machine on 1st October, 2020 for₹ 6,55,000. On 1st March, 2021, it [6]

purchased another machine for ₹ 2,40,000. On 1st July, 2022 it sold off the first machine purchased in 2020, for
₹ 5,24,000. Accumulated depreciation account is maintained charging depreciation at 10% per annum on straight
line method. Accounts are closed each year on 31st March, prepare machinery account and accumulated

depreciation account for the year ended on 31st March, 2021,2022 and 2023. Also prepare machinery disposal
account.
OR
A firm purchased on 1st April 2015 certain machinery for Rs.5,82,000 and spent Rs.18,000 on its installation. On 1st
October 2015, additional machinery costing Rs.2,00,000 was purchased. On 1st October 2017, the machinery
 purchased on 1st April 2015 was auctioned for Rs.2,86,000 plus CGST and SGST @ 6% each and new machinery
for Rs.4,00,000, plus IGST @ 12% was purchased on the same date. Depreciation was provided annually on 31st
March at the rate of 10% on the Written Down Value Method. Prepare the Machinery Account for the three years
ended 31st March 2018.
Part B
27. Calculate profit from the following information: Opening capital: Rs.5,000, Closing capital-Rs.7,000, [1]
Withdrawn- Rs.1,000, Fresh capital-Rs.500

a) Rs.2,700 b) Rs.2,500

c) Rs.2,000 d) Rs.3,500
OR
Calculate the profit from the following information: Opening capital: Rs.1,20,000, closing capital - Rs.1,80,000,
Drawings - Rs.10,000, capital added during the year-Rs.20,000.

a) Rs.60,000 b) Rs.40,000

c) Rs.50,000 d) Rs.45,000
28. Balance Sheet is prepared: [1]

a) On a particular date b) for the whole year

c) for the some part of year d) For a particular period

29. Depreciation for current year in the Trial Balance is shown in [1]

a) Debit side of Profit & Loss Account and it is b) Debit side of Trading Account.
deducted from that particular asset in the
Balance Sheet.

c) Debit side of Profit & Loss Account. d) Assets side of Balance Sheet as a deduction
from the concerned Asset.
OR
Sundry Debtors given in the Trial Balance are ₹ 20,000. Further bad debts amounted to ₹ 1,000 and it is desired to
create a provision of 5% on debtors for doubtful debts and 2% for discount. Sundry Debtors will appear in the
Balance Sheet at a figure of:

a) ₹ 17,689 b) ₹ 18,600

c) ₹ 17,670 d) ₹ 18,620
30. Arrange assets in the order of permanence: [3]
Sundry Debtors, Stock, Investment, Land and Building, Cash in Hand, Motor Vehicle, Cash at Bank, Goodwill,
Plant and Machinery, Furniture, Loose Tools, Marketable Securities.
31. From the following information, prepare the Trading Account for the year ended 31st March, 2023: [3]
Adjusted Purchases ₹ 15,00,000; Sales ₹ 21,40,000; Returns Inwards ₹ 40,000; Freight and Packing ₹ 15,000;
Packing Expenses on Sales ₹ 20,000; Depreciation ₹ 36,000; Factory Expenses ₹ 60,000; Closing Stock ₹
1,20,000.
32. Ajay started business with capital of ₹ 5,00,000 on 1st April, 2022. He introduced additional capital of ₹ [3]

3,00,000 on 1st October, 2022. He charged interest on capital @ 10% p.a. Calculate the amount of interest on
capital and show it in the final accounts.
33. The following information is available from Sahil, who maintains books of accounts on a single entry system: [6]

1 st April, 2022 (₹) 31 st March, 2023 (₹)

Cash and Bank 20,000 21,000

Sundry Debtors 17,000 25,000

Stock 40,000 60,000

Furniture 29,000 29,000

Sundry Creditors 32,000 22,000

10% Loan from Mrs. Sahil 30,000 30,000

Sahil withdrew ₹ 5,000 from the business every month for meeting his household expenses. During the year, he
sold investments held by him privately for ₹ 35,000 and invested the amount in his business.
At the end of the year 2022-23, it was found that the full year’s interest on loan from Mrs. Sahil had not been
paid. Depreciation @ 10% per annum was to be provided on furniture for the full year. Shop assistant was to be
given a share of 5% on the profits ascertained before charging such share.
Calculate profit earned during the year ended 31st March, 2023 by Sahil.
OR
Manu started business with a capital of Rs.4,00,000 on 1st October, 2005. He borrowed from his friend a sum of
Rs.1,00,000. He brought further Rs.75,000 as capital on 31st March 2006, his position was:
Cash : Rs.30,000; Stock: Rs.4,70,000; Debtors: Rs.3,50,000 and Creditors: Rs.3,00,00. He withdrew Rs.8,000 per
month during this period. Calculate profit or loss for the period.
34. The following Trial Balance was extracted from the books of Mr. Sharma as at 31st March, 2023: [6]

Amount Amount
Dr. Balances Cr. Balances
(₹) (₹)

Stock on 1-4-2022 65,000 Capital 2,50,000

Purchases 7,10,000 Rent Received 3,900

Wages 22,000 Loan from Mr. Kumar @ 15% p.a. 20,000

Trade Expenses 5,000 Sales 9,50,000

Freight and Dock Charges 8,000 Discount 600

Travelling Expenses 3,800 Outstanding Wages 2,000

Lighting and Heating (Factory) 7,200 Trade Expenses accrued but not paid 500

Stores Consumed 2,000 Sundry Creditors 80,000

Rent Paid 16,500

Establishment Charges 18,000

Interest on Mr. Kumar’s Loan 1,500

Sundry Debtors 1,42,000

Cash 6,000
 Fixed Assets 3,00,000

Adjustments:-
i. Goods costing ₹ 20,000 were purchased and included into stock but no entry was passed to record the
purchase.
ii. Loan from Mr. Kumar was taken on 1st June, 2022.
iii. Sundry Debtors include an amount of ₹ 2,000 due from a customer who has become insolvent and nothing is
recoverable from his estate.
iv. Create a provision of 5% for Doubtful Debts and 2% for discount on Debtors.
v. Three months lighting and heating bill due but not paid ₹ 3,000.
vi. Rent is paid for 11 months but is received for 13 months.
vii. Stock amounted to ₹ 90,000 on 31st March, 2023.

Prepare Trading and Profit & Loss Account for the year ended 31st March, 2023 and a Balance Sheet as at that
date.
OR
From the following balances extracted from the books of Karan and the additional information, prepare the trading
and profit and loss account for the year ended 31st March, 2013 and also show the balance sheet as on that date.

Debit Credit
Name of Accounts Amount Amount
(Rs. in 000's) (Rs. in 000's)

Stock on 1st April 2012 625

Purchases and sales 903 1,372

Returns 22 13

Capital A/c 300

Drawings 45

Land and Buildings 300

Furniture and fittings 80

Trade debtors and trade creditors 250 450

Cash in hand 35

Investments 100

Interest 5

Commission 30

Direct expenses 75

Postage, stationery, and telephone 25

Fire insurance premium 20

Salaries 90

Bank overdraft 400

 2,570 2,570
====== ======

Additional Information
i. Closing stock on 31st March 2013 is valued at Rs 6,50,000. Goods worth Rs 5,000 are reported to have been
taken away by the proprietor for his personal use at home during the year.
ii. Interest on investments Rs 500 is yet to be received while Rs 10,000 of the commission received is yet to be
earned.
iii. Rs 5,000 of the fire insurance premium paid is in respect of the quarter ending 30th June 2013.
iv. Salaries Rs 10,000 for March 2013 and bank overdraft interest estimated at Rs 20,000 are yet to be recorded as
outstanding charges.
v. Depreciation is to be provided on land and buildings @ 5% per annum and on furniture and fittings @ 10% per
annum.
vi. Make a provision for doubtful debts @ 5% of trade debtors