Bhavnagar University 2007 B.Com ADVANCED ACCOUNTANCY - exam paper

ADVANCED ACCOUNTANCY

Time : 3 hours Maximum : 100 marks
PART A — (5 × eight = 40 marks)
ans any 5 ques..
All ques. carry equal marks.
1. Explain the treatment of goodwill in the books of accounts on admission of a new partner.
2. X and Y are partners sharing profits in the ratio three : 2. On first April 2001 they admitted ‘‘ ’’ for 1/10 share of profit with a minimum guaranteed profit of Rs. 7,500 p.a. For this and sacrifices in the ratio four : 1. The profit for the year were
Rs. 50,000. Prepare profit and loss appropriation a/c.
3. What do you mean by ‘‘insolvency’’ of a partner? discuss the principles in the case of Garners Vs Murray.
4. and were partners sharing profits and losses in the ratio of three : two : 1. On 31st Dec. 2002 their Balance Sheet was as under :
Liabilities Rs. Assets Rs.
Sundry creditors 1,54,000 Bank 35,000
Bills payable 36,000 Stock 1,98,000
A's loan 1,00,000 Debtors 1,50,000
Capital A 2,00,000 (–) Provisions 10,000 1,40,000
B 1,60,000 Joint life policy 40,000
C 80,000 Machinery 4,37,000
Reserve fund 1,20,000
8,50,000 8,50,000
The firm was dissolved on first Jan. 2003. Joint life policy was taken over by P at Rs. 50,000. Stock realized Rs. 1,80,000. Debtors realised Rs. 1,45,000. Machinery was sold for
Rs. 3,60,000. Liabilities were paid in full. In addition 1 bill for Rs. 7,000 under discount was dishonoured and had to be taken up by the firm.
Give journal entries to close the books of the firm.
5. A company had issued 50,000 redeemable preference share of Rs. 10 every Rs. eight paid. In order to redeem these shares how being redeemable, the company issued for cash 30,000 equity shares of Rs. 10 every at a premium of Rs. two per share. Out of cash proceeds, the redeemable preference shares were paid and the balance was met out of the reserve fund which stood at Rs. 2,50,000.
Show the journal entries in the books of the company.
6. Explain the different methods of redemption of debentures.
7. Fire occurred in the premises on 1.1.2002 and the business books and records were saved. The subsequent info was found.
Purchases for the year ending 30.6.2001 Rs. 60,000
Sales for the year ending 30.6.2001 Rs. 90,000
Purchases from 1.7.01 to 31.12.01 Rs. 35,000
Sales from 1.7.01 to 31.12.01 Rs. 50,000
Stock on 30.6.01 Rs. 28,000
Stock on 30.6.2000 Rs. 40,000
Calculate the amount of claim to be presented to the Insurance Company in respect of the loss by fire.
8. A company leased a colliery on 1.1.2002 with a minimum rent of Rs. 20,000. The royalty was at Rs. 1.50 per ton, with a power to recoup the short working over 1st three years. The output were 2002 – 9000 tons, 2003 – 12,000 tons, 2004 – 16,000 tons, 2005 – 20,000 tons.

Earning:   Approval pending.