Financial Accounting - I - 2018-21

SHEIKH MOHAMMAD IRSHAD (MSCC) MOB- 8294345756
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(1) U(1st Sm.)-Financial Accounting-I-H/CC-1.1 Ch/CBCS
2021
FINANCIAL ACCOUNTING-I — HONOURS
Paper : CC-1.1 Ch
Full Marks : 80
The figures in the margin indicate full marks.

Candidates are required to give their answers in their own words
as far as practicable.
Group-A
Answer any four questions.
1. Mr. Roy gives the following information relating to his income and expenditures for the year ended
31.12.2020 :
`
Fees received in cash (gross) 50,500
Fees earned but not yet received 4,500
Fees received in advance 3,000
Fees for 2019 received 2,000
Staff Salaries paid (gross) 8,200
Salaries paid in advance 1,200
Salaries for 2019 paid 1,000
Rent paid for office (gross) 7,100
Outstanding office rent 600
Rent for 2019 paid 500
Telephone charges paid 1,600
Calculate the net income of Mr. Roy for the year 2020, under (i) Cash Basis, and (ii) Accrual Basis.
5+5
2. On 01.01.2018, a new plant was purchased by Mrs. Basu for ` 1,00,000 and a further sum of ` 5,000
was spent on its installation. On 01.06.2019, another plant was acquired for ` 65,000.
On 02.10.2020, the first plant was totally destroyed and the amount of ` 2,500 only was realised by selling
the scrap. It was not insured. On 20.10.2020, a second hand plant was purchased for ` 75,000 and a
further sum of ` 7,500 was spent on repairs and ` 2,500 on its erection. It came into use on 15.11.2020.
Depreciation has been provided at 10% on the original cost annually on 31st December. It was the
practice to provide depreciation for full year on all acquisitions made at any time during any year and
to ignore depreciation on any item sold during the year. The accounts are closed annually on 31st
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U(1st Sm.)-Financial Accounting-I-H/CC-1.1 Ch/CBCS (2)
December. In December 2020, it was decided to change the method of depreciation and follow the rate
of 15% on diminishing balance method.
Show Plant Account, Plant Disposal Account and Provision for Depreciation Account for 3 years.
10
3. (a) What do you mean by Capital maintenance?

(b) What is Fair value? What are the features of fair value accounting? 5+5
4. Mr. B of Bombay consigned goods costing ` 2,00,000 to his agent Mr. P of Patna. The invoice was made
pro-forma so as to show a profit of 25% on cost. Mr. B paid freight and insurance ` 4,000. Mr. P sold
part of the consignment for ` 1,76,000 at a uniform price of 10% over invoice price and spent ` 6,000
as warehousing charges and ` 2,000 as selling expenses. Mr. P is entitled to a commission of 5% on
sales and 20% of the net profit after charging commission on sales.
Draw up Consignment Account in the books of Mr. B. 10
5. On 7th June, 2020 the godown of a company was destroyed by fire. From the records of the company,
the following particulars were extracted :
`
Stock as on 01.01.2019 45,500
Stock as on 31.12.2019 60,000
Purchase less return for 31.12.2019 3,00,000
Sales less return for 31.12.2019 3,73,000
Purchase less return from 01.01.2020 to 07.06.2020 1,25,000
Sales less return from 01.01.2020 to 07.06.2020 1,80,000
Poor selling goods worth ` 5,000 were written off while valuing closing stock as on 31.12.2019. The
original cost of such goods were ` 8,000, a portion of this stock (original cost of which was ` 4,000) was
sold during March, 2020 at a loss of ` 1,000. The balance of this stock is worth the original cost value
of salvaged goods was ` 10,000. Gross profit remained at an uniform rate throughout.
You are required to ascertain the amount of loss of stock to be claimed from the Insurance Company.
10
6. From the following particulars, prepare Debtors Ledger Adjustment Account as it would appear in
Nominal ledger for the year ended 31.03.2021 in the books of Manish Shaw. 10
`
Debtors debit balance as on 01.04.2020 1,54,700
Debtors credit balance as on 01.04.2020 200
Total sales (including cash sales ` 3,400) 4,83,400
Return inward 12,400
Cash received from debtors (after allowing discount at 3%) 3,00,700
Cash paid to debtors (refunded of excess amount recieved) 2,000
Bills receivables drawn 10,000
Bad debts 43,000
Provision for bad debt 1,300
Endorsed bill dishonoured 3,400
Debtors credit balance as on 31.03.2021 600
Included in debtors was an amount ` 10,500 due from Shekhar from whom goods worth ` 8,400 were
purchased. Shekhar agreed to set off his claim against the amount due from him and action was taken
accordingly.
7. There was a difference in the trial balance of Smt. Archana Raut, a trader, on 31.12.2021 and
subsequently on going through the books the following errors were located.
(a) Purchase of furniture for ` 1,000 passed through Purchase Book.
(b) An amount of ` 550 received from R was posted to his account ` 5,500.
(c) ` 800 received from a debtor Amit, has been treated as cash sale.
(d) Discount allowed ` 150 was wrongly credited to Discount Recieved Account.
(e) Sales day book overcast by ` 200.
Pass the Journal entries to rectify the above errors. 10
8. From the following information, prepare Provision for Bad debt A/c and Provision for Discount Allowed
A/c in the Books of Tooba Niyaz, a Merchant of Delhi. 10
`
Debtors (31.12.2020) 5,00,000
Bad debt for the year 2020 10,000
Discount allowed for the year 2020 2,000
Provision for Bad Debt (01.01.2020) 5,000
Provision for Discount allowed (01.01.2020) 2,500
Please Turn Over

Additional information :
(a) Further Bad debt ` 2,000
(b) Cheque dishonoured ` 5,000
(c) Mr. Abhisekh Das included in the List of Debtors ` 10,000 and its Creditors ` 8,000.
Create Provision for Bad debt @8% and Provision for Discount allowed @5%.
Group-B
Answer any two questions.
9. The following is the Reciepts and Payments Account of The Calcutta Football Club for the year ended
on 31.12.2020.
Receipts ` Payments `
01.01.2020 31.12.2020
Cash in hand 2,000 Remuneration to Club coach 5,000
Balance as per Bank Passbook Groundsmen’s pay 2,500
Savings Account 19,300 Purchase of equipments 15,500
Current Account 6,000 Bar room expenses 2,000
Ground Rent 2,500
31.12.2020 Club night expenses 3,800
Bank interest 500 Printing & Stationery 3,000
Entrance fees 1,800 Repairs to equipment 5,000
Donation and Subscription 25,000 Honorarium to Secretary 4,000
Bar room receipts 4,000 for the year 2020
Contribution to Club night 1,000 Balance at Bank as per Passbook :
Sale of equipment 800 Savings Account 20,400
Net proceeds of Club night 7,800 Current Account 2,000
Cash in hand 2,500
68,200 68,200
You are given the following additional information (all figures in `)

01.01.2020 31.12.2020
(i) Subscription due from member 1,500 1,000
(ii) Sums due from Printing & Stationery 1,000 800
(iii) Unpresented Cheques on Current Account 3,000 2,500
being payments for repair
(iv) Interest on Savings Bank Account, not — 200
entered in Passbook
(v) Estimated value of equipment 8,000 17,500
(vi) For the year ended 31.12.2020, the Honorarium to Secretary are to be increased by a total of
` 2,000 and the Groundsman is to receive a bonus of ` 2,000.
You are required to prepare
(a) An Income and Expenditure Account for the year ended 31.12.2020, and
(b) A Balance Sheet as on that date. 20
10. (a) Explain any of the two qualitative characteristics of Financial Statements.
(b) What is accounting equation? Explain accounting cycle.
(c) Distinguish between Capital receipts and Revenue receipts. 6+8+6
11. From the following balances, prepare Trading and Profit & Loss Account for the year ended 31.12.2021
and Balance Sheet as on 31.12.2021 in the books of Mr. Arijit Mukherjee, a trader. 20
Particulars Dr. (`) Cr. (`)
Total
(a) Closing Stock at cost ` 57,000 (Market value ` 56,000)
(b) ` 2,500 received as loan from Rahaman credited to Debtors.
(c) Outstanding salary ` 500.
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(d) Goods worth ` 20,000 were destroyed by fire and Insurance claim admitted ` 15,000.
(e) Miscellaneous receipts represent sale of furniture on 30.06.2021 (W.D.V ` 12,000 on 01.01.2021)
(f) Depreciation on fixed asset @10% p.a.
(g) Provision for bad debt to be maintained @5%.
12. The following balance are available from the books of Somenath Manna, a small trader, as on 31st
December, 2020 and 2021 :
` `
The transactions of Somenath during the year ended 31.12.2021 were the following :
`
(a) Cash sales amounted to 10% of total sales. Credit sales amounted to ` 1,80,000.
(b) Credit Purchases were 80% of total purchases.
1
(c) Somenath Manna sells goods at cost plus 33 % .
3
(d) Equipment is to be depreciated by 10% per annum and Building by 2%.
(e) Difference in Cash Book, if any, is to be treated as drawings or introduction of Capital by the
proprietor.
You are required to prepare the Trading and Profit & Loss Account of Somenath for the year ended
31.12.21 and a Balance Sheet as on that date. 20


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SHEIKH MOHAMMAD IRSHAD (MSCC) MOB- 8294345756

TELEGRAM LINK- t.me/cuhelpsection56

TELEGRAM LINK- t.me/cuhelpsection56

TELEGRAM LINK- t.me/cuhelpsection56

(1) U(1st Sm.)-Financial Accounting-I-H/CC-1.1 Ch/CBCS

The figures in the margin indicate full marks.

Please Turn Over

3. (a) What do you mean by Capital maintenance?

Please Turn Over

You are given the following additional information (all figures in `)

Please Turn Over

TELEGRAM LINK- t.me/cuhelpsection56

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