Bangalore University 2005 B.Com Financial Accouting - I - Question Paper

Total capital of the new firm was to be rs. 3,20,000 and the capital of every partner was to be in his profit sharing retio which was to be three : two : three : 2. Goodwill account of the new firm was to be written off.

Open the necessary ledger accounts in both the firms books and prepare capital account in the books of the new firm.

11. The subsequent is the summarised Balance Sheet of A and B who were sharing profits and losses in the ratio of two : one respectively.

Balance Sheet as on 31-12-2001
Liabilities Rs. Assets Rs.

Capital a/c's Fixed assets 1,40,000
A 1,40,000 Stock 70,000
B 1,00,000 Debtors 1,30,000
B's loan 60,000 Cash at Bank 50,000
Creditors 90,000

3,90,000 3,90,000

The fixed assets included 2 motor cars having book values of Rs. 16,000 and Rs. 12,000, which were taken over by A and B at agreed values of Rs. 24,000 and Rs. 16,000 respectively. They sold the fixed assets (other than the motor cars) and stock to Sundar Ltd, at an agreed price of Rs. 3,20,000. The company agreed to pay cash of Rs. 1,12,000 and problem 800 preference shares of Rs. 80 every and 1800 equity shares of Rs. 100 every at a market value of Rs. 80 every.

The debtors realised Rs. 1,22,000 and the creditors were paid Rs. 85,000 in full settlement. Preference shares were used to pay B towards his loan and the balance of preference shares were provided to A in part payment of the amount due to him. Equity shares were alloted ranging from A and B in the ratio of five : 4.

Show necessary ledger accounts in the books of the partnership.

12. Mr. Mahesh wrote a book and got it published with M/s. Popular Publishers on the terms that Royalty will be paid at Rs. five per copy sold subject to a minimum payment of rs. 15,000 with a right of recoupment of shortworkings over the 1st 3 years of the royalty agreement. From the subsequent details write up :
a) Minimum rent account
b) Royalty account
c) Shortworkings account
d) Mr. Mahesh's account
Year No. of copies printed closing stock
1992 2000 100
1992 3000 200
1994 4000 400
1995 5000 500

13. The Bombay Transport Company purchased a Motor Lorry from the Delhi Motor Company on the deferred payment system on 1-1-2000 paying Rs. 20,000 on that day and agreed to pay the remaining amount in 3 annual instalments of rs. 20,000 every with interest at 5% p.a.

Prepare necessary accounts in the books of the buyer assuming that --
i) Depreciation at 10% p.a. is charged on the diminishing balance.
ii) The books are closed on 31st December.
iii) The ownership passes on to the buyer on payment of final instalment.

14. R Ltd. was formed to take over the assets and liabilities of A and B. The Balance Sheet of A and B on 31-12-98 was as follows :

Liabilities Assets

Trade creditors 8,000 Cash in hand 2,000
Capital : A 80,000 Cash at bank 12,000
B 80,000 Book debts 18,000
Stock 78,000
Furniture 10,000
Land and Buildings 48,000

1,68,000 1,68,000

The purchase consideration was agreed at Rs. 2,00,000 and was to be paid as under :

a) 5600 equity shares of Rs. 20 every fully paid.
b) Rs. 68,000 in 6% preference shares of Rs. 100 every issued at par.
c) Rs. 20,000 in cash.

All the assets and liabilities were valued as per Balance Sheet other than the book debts which were subject to a bad debt provision of 5%.

The company raised further capital by problem of 15000 equity shares of Rs. 20 every.

The adjoining premises were purchased for Rs. 1,00,000 and additional stock of Rs. 1,40,000 was found from open market.

Record the above transactions in the books of R ltd. through journal entries and draft its opening Balance sheet.

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Earning:   Approval pending.