CLASS: XII C MARKS: 80

DATE : ROLL NO: TIME : 3 Hr.

GENERAL INSTRUCTIONS:
i. This question paper contains 34 questions. All questions are compulsory.
ii. This question paper is divided into two parts, Part A and B.
iii. Part - A is compulsory for all the candidates.
iv. Question Nos.1 to 16 and 27 to 30 carries 1 mark each.
v. Questions Nos. 17 to 20, 31and 32 carries 3 marks each.
vi. Questions Nos. from 21 ,22 and 33 carries 4 marks each
vii. Questions Nos. from 23 to 26 and 34 carries 6 marks each
There is no overall choice. However, an internal choice has been provided in 7
questions of one mark, 2 questions of three marks, 1 question of four marks and 2
questions of six marks.
S.NO PART A MARKS

ACCOUNTING FOR PARTNERSHIP FIRMS AND COMPANIES

1. Kumar, Verma and Naresh were partners in a firm sharing profit and loss in 1
the ratio of 3:2:2. On 23rd January, 2015 Verma died. Verma’s share of
profit till the date of his death was calculated at ₹ 2,350.
Pass necessary journal entry for the same in the books of the firm.

2. There are two statements marked as Assertion (A) and Reason (R.). Read 1
the statement and choose the appropriate option from the options given
below:
Assertion (A): On dissolution, goodwill account is transferred to
Realisation Account.
Reason (R): Goodwill is an Asset which cannot be seen or touched.
a) Both A and R are true and R is the correct explanation of A
b) a) Both A and R are true and R is not the correct explanation of A
c)A is true but R is false
d)A is false but R is true
3. A Ltd. forfeited 100 equity shares of ₹ 10 each for the non-payment of 1
final call of ₹ 3.State the minimum reissue price at which these shares can
be re-issued:
(a) ₹ 700 (b) ₹ 300 (c) ₹ 400 (d) ₹ 1,000
4. P, Q and R sharing profit and losses in the ratio of 8:5:3. Q retires from the 1
firm. P takes 3/16 from Q and R takes 5/16 from Q. New profit-sharing

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 ratio between Q & R will be:
(a) 11:5 (b) 10:6 (c) 9:7 (d) 5:3
OR
In case of Workmen Compensation Reserve, if the amount claimed is more
than the amount lying in WCR, then the shortfall will be recorded in:
(a)Revaluation account (b)Partner’s capital account

(c) Balance sheet (d)None of these

5. Which one of the following items cannot be recorded in the profit and loss 1
appropriation account?
(a) Interest on capital (b) Interest on drawings
(c) Rent paid to partners (d) Partner’s salary
6. ABC took over the assets of Rs 7, 60,000 and liabilities of Rs 80,000 of Y 1
limited for purchase consideration of Rs 5, 85,000 payable by the issue of
12% debentures of Rs 100 each at a discount of 10%. The number of
debentures to be issued is:
(a) 6,600 (b) 6,500 (c) 4,500 (d) 5,400.
OR
Premium received on issue of debentures may be utilised for writing off:
(a) Premium allowed on redemption of debentures
(b) Writing off preliminary expenses
(c) Writing off discount allowed on issue of debentures
(d) All of the above.

7. Luxor Ltd. issued 10,000, 7% debentures of Rs. 100 each at a discount of 1

Rs. 4 redeemable at a premium of Rs. 6. It will write off loss on Issue of
debentures from:
(a) Securities Premium Reserve
(b) Statement of Profit and Loss Account
(c )Capital Reserve
(d) General Reserve
8. A and B share profits in the ratio of 2:1. C is admitted with 1/4 share in 1
profits. C acquires 3/4 of his share from A and 1/4 of his share from B. The
new ratio will be:
(a) 2:1:1 (b) 23:13:12 (c) 3:1:1 (d) 13 : 23 : 12
OR

A and B are partners. The net divisible profits as per Profit & Loss
appropriation account is Rs 2, 50, 000.The total interest on drawings is Rs
4,000.A’s salary is Rs 4,000 per quarter and B’s salary is Rs 40,000 p.a.
The net profit/loss during the year was ………..

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 9. A Company got its mining right recently. You are required to show this 1
right in financial statements of the company as
(a) Expense (b) intangible assets
(c)current assets (d) non-current liability
10. Ambrish Ltd offered 2, 00,000 Equity Shares of ₹ 10 each, of these 1, 1
98,000 shares were subscribed. The amount was payable as ₹ 3 on
application, ₹ 4 an allotment and balance on first call. If a shareholder
holding 3,000 shares has defaulted on first call, what is the
amount of money received on first call?
(a) ₹ 9,000. (b) ₹ 5, 85,000.
(c) ₹ 5, 91,000. (d) ₹ 6, 09,000.
11. Arun and Vijay are partners in a firm sharing profits and losses in the ratio 1
of 5:1.
Balance Sheet (Extract)

Liabilities amount assets amounts

Machinery 40,000

If the value of machinery reflected in the balance sheet is overvalued by

33%, find out the value of Machinery to be shown in the new Balance
Sheet:
(a) ₹ 44,000 (b) ₹ 48,000 (c) ₹ 32,000 (d) ₹ 30,000
12. Balance of Share Forfeiture account is shown in the balance sheet under the 1
item:
(a) Current Liabilities & Provisions (b) Reserve & surplus
(c ) share capital (d)unsecured loans
13. ABC limited issues 10,000 9% debentures of ₹ 100 each at a premium of 1
5% repayable at a premium of 10%, the loss on issue of debentures
account will be debited to by:
(a) ₹ 10,00,000 (b) ₹ 1,00,000 (c) ₹ 10,50,000 (d) ₹ 1,05,000
14. E, F and G are partners sharing profits in the ratio of 3:3:2. According to 1
the partnership agreement, G is to get a minimum amount of ₹80,000 as his
share of profits every year and any deficiency on this account is to be
personally borne by E. The net profit for the year ended 31st March 2021
amounted to ₹ 3, 12, 000. Calculate the amount of deficiency to be borne
by E?
(a) ₹ 1,000 (b) ₹ 4,000 (c) ₹ 8,000 (d) ₹ 2,000
15. Vee and Anu are partners in a firm sharing profits and losses in the ratio 1
2:1. Their capital balances were ₹. 10, 00,000 and 8, 00,000 respectively.
The firm made a profit during the year amounted to ₹.3,45,000. Both
partners are allowed a salary of ₹.2,500 per month. Interest on capital is

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 allowed @ 5% on capital balance. Calculate the Capital balance of Anu.
(a) ₹ 9,35,000 (b) ₹9,10,000
(c ) ₹ 9,85,000 (d) none of these
OR
N, P and S are equal partners At the time of N’s retirement. Workmen
compensation Reserve (WCR) appears in the books at ₹. 70,000 and the
claim of ₹. 25,000 was against it. The amount of WCR credited to N’s
Capital account will be ………..
16. At the time of dissolution total assets are worth ₹ 3, 00,000 and external 1
liabilities are worth ₹ 1, 20,000. If assets realized 120% and realization
expenses paid were ₹ 4,000, then profit/loss on realization will be:
(a) Profit ₹ 60,000 (b) Loss ₹ 60,000
(c) Loss ₹ 56,000 (d) Profit ₹ 56,000
17. Arjun, Bhim and Nakul are partner sharing profits and losses in the ratio of 3
14:5:6 respectively. Bhim retires and surrender his 5/25th share in favour
of Arjun. The goodwill of the firm is valued at 2 year Purchase of super
profits based on average Profits of last 3 year. The profits for the last 3 year
are ₹ 50,000, ₹ 55,000 and ₹ 60,000 respectively. The normal profits for
the similar firm are ₹ 30,000. Goodwill already appear in the books of the
firm at ₹ 75,000.
The Profit for the first year after Bhim’s retirement was ₹ 1, 00,000.
Give the necessary Journal Entries to adjust Goodwill and distribute
Profits showing your working.
18. A, B and C are partner in a firm sharing profits and losses in the ratio of 3
3:3:2.The partnership deed provided for the following:
(i) Salary of ₹ 2,000 per quarter to A and B.
(ii) C was entitled to a commission of ₹ 8,000.
(iii) B was guaranteed a profit of ₹ 50,000 p.a.
The profit of the firm for the year ended 31st March, 2019 was ₹1,50,000
which was distributed among A, B and C in the ratio of 2:2:1, without
taking into consideration the provisions of partnership deed.
Pass necessary rectifying entry for the above adjustments in the books of
the firm. Show your working clearly.
OR
A and B are partner in a firm sharing profits and losses in the ratio of 7:3.
Their fixed capitals were: A ₹ 9, 00,000 and B ₹ 4, 00,000. The
partnership deed provided the following:
(i) Interest on Capital @ 10% p.a
(ii) A’s salary ₹ 50,000 per year and B’s salary ₹ 3,000 per month.

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 Profit for the year ended 31st March, 2019 ₹ 2,78,000 was distributed
without providing for interest on capital and partner’s salary.
Showing your working clearly, pass the necessary adjustment entry for the
above omission
19. Lemon Ltd. purchased from C. Ltd., compute₹ of ₹. 3,00,000 and software 3
for ₹5,00,000 payable ₹. 80,000 by cheque and balance by issue of 7%
Debentures of ₹.100 each at a discount of 10%. The company has balance
in Securities Premium Reserve of ₹. 40,000 and in Capital Reserve of
₹.25,000. Pass the journal entries in the books of Lemon Ltd.
OR
Y Ltd took over the assets of ₹.15, 00,000 and liabilities of ₹2,00,000 of
Pranav. Ltd. with purchase consideration of ₹13, 68,500. ₹ 25,500 were
paid by issuing a promissory note in favour of P Ltd. payable after two
months and the balance was paid by issue of Equity shares of ₹100 each at
a premium of 25%. Pass necessary journal entries for the above
transaction I the books of Y Ltd.

20. (a) Give journal entries for the issue of debentures in the following 3
conditions:
(i) Issued 3,000, 12% debentures of ₹ 100 each at a premium of 5%,
redeemable at par.
(ii) Issued 4,000, 12% debentures of ₹ 100 each at a premium of 5%,
redeemable at a premium of 10%.
(b) On 1st April, 2015, X Ltd. took a long-term loan of ₹ 4, 00,000 from
SBI Bank and issued 5,000; 10% Debentures of ₹ 100 each as collateral
security. Show the entry passed for issue of debenture as collateral security.
21. Maanika, Bhavi and Komal are partner sharing profits in the ratio of 6:4:1. 4
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.
22. P, Q and R were partner in a firm sharing profits and losses in the ratio of 4
2:2:1. The firm was dissolved on 31st March, 2019. After the transfer of
assets (other than cash) and external liabilities to the realization account,
the following transactions took place:
(i) A debtor whose debt of ₹. 90,000 had been written off as bad, paid
₹88,000 in full settlement.
(ii) Creditor to whom ₹.1, 21,000 were due to be paid, accepted stock at

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 ₹71,000 and the balance was paid to them by a cheque.
(iii) Q had given a loan to the firm of ₹ 18,000. He was paid ₹. 17,000 in
full settlement of his loan.
(iv) Profit & loss A/c were showing a debit balance of ₹. 15,000 on the
date of dissolution.
Pass necessary Journal entries for the above transactions in the books of the
firm

23. Guru Limited invited applications for issuing 80,000 equity shares of ₹ 10 6
each at a premium of ₹ 10 per shares. The amount was payable as follows:
On Application and Allotment: ₹ 10 (including ₹ 5 premium)
On First and Final Call : ₹ 10 (including ₹ 5 premium)
Application for 100,000 shares were received. Applications for 10,000
shares were rejected and Application money was refunded. Shares were
allotted on pro-rata basis to the remaining applicants.
Excess application money received from applicants to whom shares were
allotted on pro-rata basis was adjusted towards sums due on first and final
call. All calls were made and were duly received except the first and final
call money from Kumar who had applied for 1,800 shares. His shares were
forfeited.
The forfeited shares were reissued at ₹ 9 per share fully paid-up.
Pass necessary journal entries for the above transactions in the books of
Guru Limited.
OR
(a) N Ltd .issued 2,000 shares of ₹ 100 each. All the money was received
except on 200 shares on which only ₹ 90 were received. These shares were
forfeited and out of the forfeited shares 100 shares were reissued at ₹ 80
each as fully paid up.
Pass necessary journal entries for the forfeiture and re-issue of shares.

(b) Complete the following Entries:

Date Particulars Debit (₹) Credit (₹)

i. ………………..Dr. ……
To …………. ……..
To ………….. ……..
(Being the forfeiture of 1000 shares of ₹ 10
each ,₹ 8 Called up, on which allotment
money of ₹ 2 and First Call
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 of ₹ 3 has not been received)
ii ………………..Dr. ……
To …………. ……..
To ………….. ……..

(Being reissue of 1000 forfeited shares

fully paid up at ₹ 11 per share)
iii ………………..Dr. ……
To …………. ……..
(Being gain on forfeiture and reissue of shares
transferred. to Capital reserve Account)
24. ‘A’ and ‘B’ are partner in a firm sharing profits in the ratio of 3:2. On C’s 6
admission the Balance Sheet of the firm was as follows:

Balance Sheet as on 31st March, 2021

On the above date, C was admitted into partnership on the following terms:
(a) C was to pay ₹ 56,000 as capital and ₹ 14,000 as goodwill for 1/6th
share in profits.
(b) Land and building were to be increased to ₹ 1, 20,000 and Plant and
Machinery decreased by 20 %. All debtor were good. Creditor included ₹
9,800 no longer payable.
Pass journal entries to record the above transactions.
OR
The Balance Sheet of A, B and C who were sharing profits and losses in
the ratio of1/2, 1/3 and 1/6 respectively was as follows as on 1st April,
2019.

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 C retired from business on 1st April, 2019 and his share in the firm was to
be ascertained on the revaluation of assets as follows.
a) The goodwill of the firm was valued at ₹ 27,000.
b) Depreciation to be provided @10 % on machinery.
c) Patents were to be reduced by 20%.
d) Liability on account of provident fund was admitted at ₹ 2,400.
e) C took over investments at ₹ 15,800.
Prepare Revaluation A/c and Partner capital A/c

25. Vijay, Vivek and Vinay are partner in a business sharing profits as 3/4, 1/8 6
and 1/8 respectively and their Balance Sheet as at 31st March, 2020 was:

Vinay died on 31st December, 2020 and the Partnership Deed provided the
following:
(a) The deceased partner will be entitled to his share of profits up to the
date of death, calculated on the basis of previous year’s profits.
(b) He will be entitled to his share of goodwill of the firm, calculated on the
basis of three year’s purchase of the average profits of the four year. The
net profits for the last four years ended 31st March,
2017 – ₹. 8,00,000; 2018 – ₹. 6,00,000;
2019 – ₹. 4,00,000 2020 – ₹. 2,00,000.
(c) His drawing up to the date of death was ₹. 18,000.
Determine the amount payable to the legal representatives of the deceased
partner by preparing the accounts.

26. (A) C India Ltd. purchased machinery from B India Ltd. Payment to B 6
India Ltd. was made as follows :
(i) By issuing 10,000 equity shares of ₹ 10 each at a premium of 20%.
(ii) By issuing 1000, 9% debentures of ₹ 100 each at a discount of 5%.
(iii) Balance by giving a bank draft of ₹ 37,000.
Pass necessary journal entries in the books of C India Ltd. for the purchase
of machinery and payment to B India Ltd.

(B) On April 1, 2019 Z Ltd. issued, 10,000, 8% Debentures of ₹ 100 each

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 at premium of 5%, to be redeemable at a premium of 10%, after 5 year.
The entire amount was payable on application. The issue was
oversubscribed to the extent of 10,000 debentures and the allotment was
made proportionately to all the applicants. The securities premium amount
has not been utilized for any other purpose during the year. Give journal
entries for the issue of debenture.

PART B
ANALYSIS OF FINANCIAL STATEMENTS
27. Revenue from Operations ₹. 4,00,000; Cost of Revenue from Operations 1
60% of Revenue from Operations; Operating expenses ₹30,000 and rate of
income tax is 40%. What will be the amount of profit after tax?
(a) ₹. 64,000 (b) ₹. 78,000 (c) ₹. 52,000 (d) ₹. 96,000
OR
Name two accounting ratios which are complementary to each other:
(a) Current ratio and Quick ratio
(b) Operating ratio and operating profit ratio
(c) Gross profit ratio and Net Profit ratio
(d) All of these

28. Under which major headings and sub-heading will “Provision for employee 1
benefits “shown in the Balance Sheet of a company as per Schedule III of
Companies Act, 2013?
(a) Head: Non-current liability Sub head ; Deferred provision
(b) Head: Non-current liability Sub head ; Long term provision
(c) Head: Current liability Sub head ; Current liability
(d) Head: Current liability Sub head ; Short term provision

29. Proposed dividend is a : 1

(a) Current liability (b) Noncurrent liability

(c) other current liability (d) contingent liability
OR
Balance Sheet (Extract)

Additional Information:
Interest on debentures is paid on half yearly basis on 30th September and
31st March each year. Debentures were redeemed on 30th September,
2019. How much amount (related to above information) will be shown in
Financing Activity for Cash Flow Statement prepared on 31st March,
2020?
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 (a) Outflow ₹ 40,000. (b) Inflow ₹ 42,000.
(c) Outflow ₹ 58,000. (d) Outflow ₹ 64,000
30. A firm has Current ratio of 2.5:1 and a Liquid ratio of 2:1. Its opening 1
Inventory is ₹80,000 which is 3 times lesser than its closing inventory.
What will be the Quick Assets?
(a) ₹ 2,40,000 (b) ₹ 9,60,000
(c) ₹ 4,80,000 (d) ₹ 12,00,000
31. Classify the following items under Major heads and Sub-heads (if any) in 3
the Balance Sheet of the Company as per Schedule III of the Companies
Act 2013.
(a) Security premium reserve
(b) Building under construction
(c) Publishing titles
(d) livestock
(e) cheques in hand
(f) Loose Tool
32. State giving reasons, which of the following transactions would increase, 3
decrease or not change the Stock Turnover Ratio.
(a) Sale of goods for ₹. 25,000 (costing ₹. 20,000)
(b) Increase in the value of closing stock by ₹.12,000
(c) Goods purchased for ₹. 50,000.
(d) Purchase Return amounting to ₹. 5,000
(e) Goods costing ₹. 15,000 distributed as free samples.
(f) Goods costing ₹. 5,000 withdrawn for personal use.

33. 4

OR

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 34. Prepare a cash flow statement from the following balance sheet: 6

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