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What are the objectives of accounting?
Define depreciation, discuss any three advantages of depreciation.
Consider the following transactions of a December month are given below:
December 1: Cash in hand Rs.10,000 and at bank Rs.20,000.
December 5: Cash paid to supplier Rs.5,000.
December 13: Cash receipt from customer through bank Rs.8,000.
December 19: Interest collected by the bank Rs.2,000.
December 22: Sold goods for cash Rs.15,000.
December 26: Deposited Rs.5,000 into the bank.
December 30: Salary expenses paid through cheque Rs.4,000
Required: Cash and Bank column.
ABC company purchased first machine on 1st January, 2015 for Rs.10,000. On 1st July in the same year another machine was purchased costing Rs.5,000. The first machine purchased on 1st January 2015 having become obsolete, was sold off for Rs.4,000 on 1st July 2016. On the 1st July 2017, a new machine was purchased for Rs.12000 and the second machine purchased on 1st July 2015 was sold at Rs.4,200 on the same date. Depreciation is to be provided at 10% per annum on straight line method every year.
Required: Machinery account for the first three year.
The following material transactions of a manufacturing company is provided to you:
2018 December, 1:Opening stock of raw material 500 units @ Rs.1 each
2018 December, 5:Purchased 300 units @ Rs.1.20 each.
2018 December, 9:Issued 500 units.
2018 December, 14: Purchased 400 units @ Rs. 1.25
2018 December, 18: Issued 500 units
2018 December, 22: Purchased 300 units @ Rs. 1.40
2018 December, 25: Issued 300 units
2018 December, 30: Loss of material 20 units
Required: Store ledger under FIFO method
The balance as per cash book is Rs.10,000 on the 1st Chaitra 2079. The following transactions were found disagree with pass book.
Cheque issued but not presented for payment Rs 1000
Cheque paid into bank but not yet credited by bank Rs 1500
Bank charges made by bank but not entered in cash book Rs 150
Insurance premium directly paid by bank but not entered in cash book Rs 350
Dividend directly collected by bank but not recorded in cash book Rs 1200
Required: Bank reconciliation statement as on 31st Chaitra 2079.
Jyoti company issued 3000 shares of Rs. 100 payables as below:
On application.................Rs 50 On allotment................Rs 30
On final call......................Rs 30
The money was collected as below:
- The holder of 100 shares paid the final call money with allotment.
- The holder of 400 shares fail to pay final call.
- Other shareholders paid their money when required by the company.
- Any unpaid money to be forfeited.
Required: Journal entries. [1+2+2]
Attempt any TWO questions
[2x10=20]You are given following transactions of Jyoti Suppliers:
1. Started business with cash Rs. 5,00,000 and equipment Rs. 7,50,000
2. Purchased goods Rs. 25,000 on account and made partial payment Rs. 10,000
3. Paid insurance for the year Rs. 6,000
4. Sold goods on account for Rs.30,000 and received Rs partially Rs 20,000
5. Paid rent Rs 4,800 and travelling expenses Rs 2,800
6. Sold goods on cash Rs 55,000
7. Purchased good on credit Rs 21,000
8. Cash paid to Accounts payable Rs. 90,000 in full settlement of Rs 92,000
9. Cash withdraw from bank Rs 40,000 for office use
10. Paid assistant's salary Rs 12,000
11. Goods costing Rs 12,000 lost by fire and the insurance company admits full claim
12. Bought furniture from S.S furniture Udhyog on credit Rs 30,000
Required:
a) Journal Entries
b) Sales Account, Account Payable account and Account Receivable Account.
| Particulars | Dr. Amount | Particulars | Cr. Amount |
|---|---|---|---|
| Purchases | 4,00,000 | Capital | 3,00,000 |
| Opening Stock | 3,50,000 | Purchase return | 10,000 |
| Sales return | 10,000 | Sales | 6,90,000 |
| Carriage inward | 8,000 | Creditors | 33,000 |
| Debtors | 42,000 | Bank loan | 80,000 |
| Advertisement Expenses | 14,000 | ||
| Discount | 2,000 | ||
| Insurance expenses | 10,000 | ||
| Salaries | 65,000 | ||
| Interest on bank loan | 4,000 | ||
| General expenses | 20,000 | ||
| Wages | 40,000 | ||
| Furniture | 50,000 | ||
| Rent paid | 40,000 | ||
| Bad debt | 3,000 | ||
| Bank and cash balance | 55,000 | ||
| Total | 11,10,000 | Total | 11,10,000 |
i. Closing stock Rs. 3,75,000 ii. Bad debts Rs. 2,000
iii. Provide reserve for bad debts 5% of debtors
iv. Advance for salaries Rs. 5,000
v. Outstanding wages Rs. 2,000 vi. Outstanding interest of bank loan Rs. 4,000
vii. Depreciation furniture at 5% p.a.
Required:
a) Trading Account
b) Profit and loss account
c) Balance sheet [3+4+3]
Define Company and Explain its Features. And differentiate between shares and debentures.