CBSE Class 12 Accountancy 2019 — Set 67/3/1

State with reason whether 'cash deposited in bank' will result in inflow, outflow or no flow of cash while preparing Cash Flow Statement.

What is meant by 'cash flows from investing activities'?

A and B are partners in a firm sharing profits and losses in the ratio of 2 : 1. On 1st April, 2017 they decided to admit C into partnership for 1/5 th share in the profits. For this purpose, goodwill was valued at 80% of the average annual profits of the previous four years. The profits of the last four years were : Year Ending | Amount ₹ 31.3.2014 | 1,67,000 31.3.2015 | 1,56,000 31.3.2016 | 1,92,000 31.3.2017 | (10,000) Calculate the value of goodwill of the firm and the amount of goodwill premium brought by C on his admission.

Nano Ltd. purchased assets of Dow Ltd. for ₹ 3,00,000. It also agreed to take over the liabilities of Dow Ltd. amounting to ₹ 50,000 for a purchase consideration of ₹ 2,75,000. The payment to Dow Ltd. was made by issue of 8% Debentures of ₹ 50 each at a premium of 10%. Pass necessary journal entries for the above transactions in the books of Nano Ltd. OR On 1st April, 2014, a limited company issued ₹ 4,00,000, 9% debentures at 93%, repayable by draw of lots in two equal instalments starting from 31st March, 2017. Prepare Discount on Issue of Debentures Account from 1st April, 2014 to 31st March, 2016.

Mita, Gopal and Farhan were partners sharing profits and losses in the ratio 3 : 2 : 1. On 31st March, 2018 they decided to change the profit sharing ratio to 5 : 3 : 2. On this date, the Balance Sheet showed deferred advertisement expenditure ₹ 30,000 and contingency reserve ₹ 9,000. Goodwill was valued at ₹ 4,80,000. Pass the necessary journal entries for the above transactions in the books of the firm on its reconstitution.

Shirish, Harit and Asha were partners in a firm sharing profits in the ratio of 5 : 4 : 1. Shirish died on 30th June, 2018. On this date their Balance Sheet was as follows : Balance Sheet of Shirish, Harit and Asha as at 31st March, 2018 | Liabilities | Amount ₹ | Assets | Amount ₹ | | --- | --- | --- | --- | | Capital : | | Plant and Machinery | 5,60,000 | | Shirish 1,00,000 | | Stock | 90,000 | | Harit 2,00,000 | | Debtors | 10,000 | | Asha 3,00,000 | 6,00,000 | Cash | 40,000 | | Profits for the year 2017 – 18 | 80,000 | | | | Bills Payable | 20,000 | | | | | 7,00,000 | | 7,00,000 | According to the partnership deed, in addition to deceased partner's capital, his executor is entitled to : (i) Share in profits in the year of death on the basis of average of last two years' profit. Profit for the year 2016 – 17 was ₹ 60,000. (ii) Goodwill of the firm was to be valued at 2 years' purchase of average of last two years' profits. Prepare Shirish's Capital Account to be presented to his executor.

Explain briefly any four objectives of 'Financial Statement Analysis'. OR Under which major headings and subheadings will the following items be presented in the Balance Sheet of a company as per Schedule III, Part I of the Companies Act, 2013 ? (i) Balance of the Statement of Profit and Loss (ii) Interest accrued on investments (iii) Livestock (iv) Licenses and Franchise (v) Securities Premium Reserve (vi) Trade Marks (vii) Work in Progress (viii) 9% Debentures repayable during the current year

Calculate opening and closing trade receivables from the following information : Trade Receivable turnover ratio 4 times; Cost of Revenue from Operations ₹ 3,20,000; Gross profit ratio 20%; Closing trade receivables were ₹ 15,000 more than opening trade receivables; cash revenue from operations being 33 1/3 % of credit revenue from operations. OR The Quick Ratio of a company is 1·5 : 1. State, giving reasons, which of the following transactions will improve, reduce or not change the quick ratio : (i) Purchase of goods for cash (ii) Bills payable paid at maturity (iii) Sale of goods costing ₹ 18,000 for ₹ 16,000 (iv) Cash collected from debtors

Adiraj and Karan were partners in a firm sharing profits and losses in the ratio 3 : 2. On 31st March, 2018 the firm was dissolved. After the transfer of assets (other than cash in hand and at bank) and third party liabilities to the Realization Account, the following information was provided : (i) Furniture of ₹ 70,000 was sold for ₹ 68,000 by auction and auctioneer's commission amounted to ₹ 2,000. (ii) Adiraj's loan amounting to ₹ 35,000 was paid. (iii) Out of the stock of ₹ 80,000, Karan took over 50% of the stock at a discount of 20% while the remaining stock was sold off at a profit of 30% on cost. (iv) A bills receivable of ₹ 3,000 under discount was dishonoured as the acceptor had become insolvent and hence the bill had to be met by the firm. (v) Profit and Loss Account showed a debit balance of ₹ 56,000. (vi) Realization expenses amounted to ₹ 2,000 which were paid by Adiraj. Pass the necessary journal entries for the above transactions on the dissolution of the firm.

Shreya and Vivek were partners in a firm sharing profits in the ratio 3 : 2. The balances in their capital and current accounts as on 1st April, 2017 were as under : | | Sherya (₹) | Vivek (₹) | | --- | --- | --- | | Capital accounts | 3,00,000 | 2,00,000 | | Current accounts | 1,00,000 (Cr.) | 28,000 (Dr.) | The partnership deed provided that Shreya was to be paid a salary of ₹ 5,000 p.m. whereas Vivek was to get a commission of ₹ 30,000 for the year. Interest on capital was to be allowed @ 8% p.a. whereas interest on drawings was to be charged @ 6% p.a. The drawings of Shreya were ₹ 3,000 at the beginning of each quarter while Vivek withdrew ₹ 30,000 on 1st September, 2017. The net profit of the firm for the year before making the above adjustments was ₹ 1,20,000. Prepare Profit and Loss Appropriation Account and Partners' Capital and Current Accounts. OR Ramesh, Mahesh and Suresh were partners in a firm sharing profits in the ratio of 3 : 3 : 2. Their respective fixed capitals were : Ramesh ₹ 5,00,000; Mahesh ₹ 4,00,000 and Suresh ₹ 3,00,000. They admitted Govind as a new partner for 1/5 th share in the profits. Govind brought ₹ 4,00,000 as his capital and the necessary amount for goodwill premium. Their new profit sharing ratio will be 2 : 1 : 1 : 1. Calculate the value of goodwill of the firm, showing your workings clearly. Pass necessary journal entries for the above transactions on Govind's admission.

From the following Balance Sheet of Mayur Ltd. and the additional information as at 31st March, 2018, prepare a Cash Flow Statement : Mayur Ltd. Balance Sheet as at 31st March, 2018 | Particulars | Note No. | 31.3.2018 ₹ | 31.3.2017 ₹ | | --- | --- | --- | --- | | I – Equity and Liabilities : | | | | | 1. Shareholder's Funds : | | | | | (a) Share Capital | | 30,00,000 | 20,00,000 | | (b) Reserves and Surplus | 1 | 3,00,000 | 4,00,000 | | 2. Non-Current Liabilities : | | | | | Long-term Borrowings | 2 | 4,00,000 | 3,00,000 | | 3. Current Liabilities : | | | | | (a) Trade Payables | | 1,70,000 | 2,50,000 | | (b) Short-term Provisions | 3 | 76,000 | 64,000 | | Total | | 39,46,000 | 30,14,000 | | II – Assets : | | | | | 1. Non-Current Assets : | | | | | Fixed Assets : | | | | | (i) Tangible | 4 | 29,00,000 | 23,00,000 | | (ii) Intangible | 5 | 2,70,000 | 1,60,000 | | 2. Current Assets : | | | | | (a) Inventories | | 2,20,000 | 2,30,000 | | (b) Trade Receivables | | 1,10,000 | 1,30,000 | | (c) Cash and Cash Equivalents | | 4,46,000 | 1,94,000 | | Total | | 39,46,000 | 30,14,000 | Notes to Accounts : | Note No. | Particulars | 31.3.2018 ₹ | 31.3.2017 ₹ | | --- | --- | --- | --- | | 1. | Reserves and Surplus : Surplus (Balance in Statement of Profit and Loss) | 3,00,000 | 4,00,000 | | 2. | Long-term Borrowings : 9% Debentures | 4,00,000 | 3,00,000 | | 3. | Short-term Provisions : Provision for Tax | 76,000 | 64,000 | | 4. | Tangible Assets : Machinery | 36,00,000 | 28,00,000 | | | Accumulated Depreciation | (7,00,000) | (5,00,000) | | | | 29,00,000 | 23,00,000 | | 5. | Intangible Assets : Goodwill | 2,70,000 | 1,60,000 | Additional Information : (i) During the year, a piece of machinery costing ₹ 4,00,000 on which accumulated depreciation was ₹ 73,000 was sold for ₹ 3,10,000. (ii) 9% Debentures of ₹ 1,00,000 were issued on 31st March, 2018.

Sunstar Ltd. invited applications for issuing 2,00,000 equity shares of ₹ 50 each. The amount was payable as follows : On Application – ₹ 15 per share On Allotment – ₹ 10 per share On First and Final Call – ₹ 25 per share Applications for 3,00,000 shares were received. Allotment was made to the applicants as follows : | Category | No. of Shares Applied | No. of Shares Allotted | | --- | --- | --- | | I | 2,00,000 | 1,50,000 | | II | 1,00,000 | 50,000 | Excess money received with applications was adjusted towards sums due on allotment and calls. Namita, a shareholder of Category I, holding 3,000 shares failed to pay the allotment money. Her shares were forfeited immediately after allotment. Manav, a shareholder of Category II, who had applied for 1,000 shares failed to pay the first and final call. His shares were also forfeited. All the forfeited shares were reissued at ₹ 60 per share fully paid up. Pass necessary journal entries and prepare Cash Book for the above transactions in the books of Sunstar Ltd. OR Megha Ltd. invited applications for issuing 90,000 equity shares of ₹ 100 each at a premium of ₹ 60 per share. The amount was payable as follows : On Application – ₹ 30 per share (including premium ₹ 10) On Allotment – ₹ 70 per share (including premium ₹ 50) On First and Final Call – Balance amount Applications for 1,00,000 shares were received. Shares were allotted on pro-rata basis to all the applicants. Excess money received with application was adjusted towards sums due on allotment. Sudha, a shareholder holding 4,500 shares, failed to pay the allotment money. Her shares were forfeited immediately after allotment. Afterwards the first and final call was made. Rajat, a holder of 3,600 shares, failed to pay the first and final call. His shares were also forfeited. All the forfeited shares were re-issued for ₹ 90 per share fully paid up. Pass necessary journal entries and prepare Cash Book for the above transactions in the books of Megha Ltd.

Raman and Rohit were partners in a firm sharing profits and losses in the ratio of 2 : 1. On 31st March, 2018, their Balance Sheet was as follows : Balance Sheet of Raman and Rohit as at 31st March, 2018 | Liabilities | Amount ₹ | Assets | Amount ₹ | | --- | --- | --- | --- | | Capital : | | Plant and Machinery | 1,75,000 | | Raman 1,40,000 | | Furniture and Fixtures | 65,000 | | Rohit 1,00,000 | 2,40,000 | Stock | 47,000 | | Workmen Compensation Fund | 40,000 | Debtors 1,10,000 | | | Creditors | 1,60,000 | Less : Provision for doubtful debts 7,000 | 1,03,000 | | | | Bank Balance | 50,000 | | | 4,40,000 | | 4,40,000 | On the above date, Saloni was admitted in the partnership firm. Raman surrendered 2/5 th of his share and Rohit surrendered 1/5 th of his share in favour of Saloni. It was agreed that : (i) Plant and machinery will be reduced by ₹ 35,000 and furniture and fixtures will be reduced to ₹ 58,500. (ii) Provision for bad and doubtful debts will be increased by ₹ 3,000. (iii) A claim for ₹ 16,000 for workmen's compensation was admitted. (iv) A liability of ₹ 2,500 included in creditors is not likely to arise. (v) Saloni will bring ₹ 42,000 as her share of goodwill premium and proportionate capital. Prepare Revaluation Account, Partners' Capital Accounts and Balance Sheet of the reconstituted firm. OR Sushma, Gautam and Kanika were partners in a firm sharing profits in the ratio of 5 : 3 : 2. On 31st March, 2018, their Balance Sheet was as follows : Balance Sheet of Sushma, Gautam and Kanika as at 31st March, 2018 | Liabilities | Amount ₹ | Assets | Amount ₹ | | --- | --- | --- | --- | | Creditors | 60,000 | Cash at Bank | 1,40,000 | | Employees' Provident Fund | 40,000 | Sundry Debtors | 1,60,000 | | Profit and Loss Account | 1,00,000 | Stock | 2,40,000 | | Capital : | | Investments | 2,00,000 | | Sushma 3,00,000 | | Fixed Assets | 3,60,000 | | Gautam 2,50,000 | | | | | Kanika 3,50,000 | 9,00,000 | | | | | 11,00,000 | | 11,00,000 | On the above date, Sushma retired and it was agreed that : (i) Fixed Assets will be reduced to ₹ 2,90,000. (ii) A provision of 5% on debtors for bad and doubtful debts will be created. (iii) Stock was to be valued at ₹ 2,18,000. Sushma took over the stock at this value. (iv) Goodwill of the firm on Sushma's retirement was valued at ₹ 8,00,000. Sushma's share of goodwill was treated by debiting Gautam and Kanika's Capital Accounts. (v) Sushma was paid cash brought by Gautam and Kanika in such a way that their capitals became in profit sharing ratio and a balance of ₹ 58,000 was left in the bank. (vi) Gautam and Kanika will share the future profits in the ratio of 2 : 3. Prepare Revaluation Account, Partners' Capital Accounts and the Balance Sheet of the reconstituted firm.