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12th Standard Accountancy English Medium Important 3 Mark Book Back Questions (New Syllabus) 2020

Published on: 01/09/2020

Download Tamil Nadu 12th Standard Accountancy question papers, model tests, one-mark questions, important questions, and public exam papers in PDF format. Free study materials and answer keys for TN State Board students.

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Questions:

Generic 3

20 x 3 = 60

Malathi and Shobana are partners sharing profits and losses in the ratio of 5:4. They admit Jayasri into partnership for 1/3 share of profit. Jayasri pays cash Rs. 6,000 towards her share of goodwill. The new ratio is 3:2:1. Pass necessary journal entry for adjusting goodwill on the assumption that the fixed capital method is followed.

What are the journal entries to be passed on revaluation of assets and liabilities?

Rani, Jaya and Rathi are partners sharing profits and losses in the ratio of 2 : 2 : 1. On 31.3.2018, Rathi retired from the partnership. Profit of the preceding years is as follows: 2014: 10,000; 2015: Rs. 20,000; 2016: Rs.18,000 and 2017: Rs. 32,000 Find out the share of profit of Rathi for the year 2018 till the date of retirement if
(a) Profit is to be distributed on the basis of the previous year’s profit
(b) Profit is to be distributed on the basis of the average profit of the past 4 years
Also pass necessary journal entries by assuming partners capitals are fluctuating.

Gemini Ltd. forfeited 20 equity shares of Rs.10 each, Rs.7 called up, on which Mahesh had paid application and allotment money of Rs.5 per share. Of these 15 shares were reissued to Naresh by receiving Rs.6 per share paid up as Rs.7 per share. Pass journal entries for forfeiture and reissue.

How is operating profit ascertained?

Mention the commonly used voucher types in Tally.ERP 9.

How is the value of goodwill calculated under the capitalisation method?

From the following information relating to a partnership firm, find out the value of its goodwill based on 3 years purchase of average profits of the last 4 years:
(a) Profits of the years 2015, 2016, 2017 and 2018 are Rs. 10,000, Rs. 12,500, Rs. 12,000 and Rs. 11,500 respectively.
(b) The business was looked after by a partner and his fair remuneration amounts to Rs. 1,500 per year. This amount was not considered in the calculation of the above profits.

Janani, Kamali and Lakshmi are partners in a firm sharing profits and losses equally. As per the terms of the partnership deed, Kamali is allowed a monthly salary of Rs. 10,000 and Lakshmi is allowed a commission of Rs. 40,000 per annum for their contribution to the business of the firm. You are required to pass the necessary journal entry. Assume that their capitals are fluctuating.

10.

From the following balance sheets of Subha and Sudha who share profits and losses in 2 : 3, calculate interest on capital at 5% p.a. for the year ending 31st December, 20

**Balance sheet as on 31st December, 2018**
Liabilities	Rs.	Rs.	Assets	Rs.
Capital accounts			Fixed assets	70,000
Subha	40,000		Current assets	60,000
Sudha	60,000	1,00,000
Current liabilities		30,000
		1,30,000		1,30,000

Drawings of Subha and Sudha during the year were Rs. 8,000 and Rs. 10,000 respectively. Profit earned during the year was Rs. 30,000

11.

The following particulars are available in respect of a business carried on by a partnership firm:
(a) Profits earned: 2016: Rs. 30,000; 2017: Rs. 29,000 and 2018: Rs. 32,000.
(b) Profit of 2016 includes a non-recurring income of Rs. 3,000.
(c) Profit of 2017 is reduced by Rs. 2,000 due to stock destroyed by fire.
(d) The stock is not insured. But, it is decided to insure the stock in future. The insurance premium is estimated at Rs. 5,600 per annum.
You are required to calculate the value of goodwill on the basis of 2 years purchase of average profits of the last three years.

12.

Anbu is a partner in a partnership firm. As per the partnership deed, interest on drawings is charged at 12% p.a. During the year ended 31st December 2018 he drew as follows:
Date Rs March 1 6,000 June 1 4,000 September 1 5,000 December 1 2,000 Calculate the amount of interest on drawings by using product method.

13.

From the following balance sheets of Brindha and Praveena who share profits and losses in the ratio of 3:4, calculate interest on capital at 6% p.a. for the year ending 31^st December 2017.

Balance sheet as on 31st December 2017
Liabilities	Rs.	Assets	Rs.
Capital accoun		Sundry assets	80,000
Brindha	30,000
Praveena	40,000
Profit and loss appropriation A/c	10,000
	80,000		80,000

On 1^st July 2017, Brindha introduced an additional capital of Rs. 6,000 and on 1st October 2017, Praveena introduced Rs. 10,000. Drawings of Brindha and Praveena during the year were Rs. 5,000 and Rs. 7,000 respectively. Profit earned during the year was Rs. 31,000.

14.

How the following items appear in the final accounts of Thoothukudi Young Pioneers Association?. There are one hundred members in the association each paying Rs. 25 as annual subscription. By the end of the year 10 members had not paid their subscription but four members had paid for the next year in advance.

15.

How annual subscription is dealt with in the final accounts of not–for–profit organisation?

16.

How will the following items appear in the final accounts of a club for the year ending 31^st March 2017? A club received subscription of Rs. 25,000 during the year 2016-17. This includes subscription of Rs. 2,000 for 2015-16 and Rs. 1,500 for the year 2017-18. Subscription of Rs. 500 is still outstanding for the year 2016-17.

17.

From the following particulars of Tamil Educational Society, prepare Receipts and Payments account for the year ended 31^st March, 2019.

Particulars	Rs.	Particulars	Rs.
Opening cash balance as on 1.4.2018	18,000	Building purchased	2,10,000
Rent paid	6,000	Staff salary	55,000
Scholarship given	15,200	Subscription received	2,65,000
Entrance fees received	18,500

18.

Following are the balances in the books of Thomas as on 31^st March 2019.

Particulars	Rs.	Particulars	Rs.
Sundry creditors	6,00,000	Bills payable	1,20,000
Furniture	80,000	Cash in hand	20,000
Land and building	3,00,000	Bills receivable	60,000
Sundry Debtors	3,20,000	Stock	2,20,000

Prepare a statement of affairs as on 31^st March 2019 and calculate capital as at that date.

19.

From the following particulars, calculate total sales.

Particulars	Rs
Debtors on 1^stApril 2017	1,50,000
Bills receivable on 1^st April 2017	40,000
Cash received from debtors	3,90,000
Cash received for bills receivable	90,000
Bills receivable dishonoured	10,000
Sales return	40,000
Bills receivable on 31^st March, 2018	30,000
Sundry debtors on 31^st March, 2018	1,30,000
Cash sales	2,00,000

20.

From the following details, calculate the missing figure:

	Rs
Capital as on 1^st April, 2017	2,50,000
Capital as on 31^st March, 2018	2,75,000
Additional capital introduced during the year	30,000
Profit for the year	15,000
Drawings during the year	?

Generic 5

6 x 5 = 30

21.

Distinguish between sacrificing ratio and gaining ratio.

22.

Ramya, Sara and Thara are partners sharing profits and losses in the ratio of 5:3:2. On 1^st April 2018, Thara retires and on retirement, the following adjustments are agreed upon:
(i) Increase the value of premises by Rs. 40,000.
(ii) Depreciate stock by Rs. 3,000 and machinery by Rs. 6,500.
(iii) Provide an outstanding liability of Rs. 500
Pass journal entries and prepare revaluation account.

23.

From the following particulars of Siva Ltd, prepare common size income statement for the years ended 31st March, 2016 and 31st March, 2017.

Particulars	2015-16	2016-17
	Rs.	Rs.
Revenue from operations	2,00,000	3,00,000
Other income	25,000	75,000
Expenses	2,50,000	1,50,000
Income tax %	40	40

24.

Sriram and Raj are partners sharing profits and losses in the ratio of 2:1. Nelson joins as a partner on 1st April 2017. The following adjustments are to be made:
(i) Increase the value of stock by Rs. 5,000
(ii) Bring into record investment of Rs. 7,000 which had not been recorded in the books of the firm.
(iii) Reduce the value of office equipment by Rs. 10,000
(iv) A provision would also be made for outstanding wages for Rs. 9,500.
Give journal entries and prepare revaluation account.

25.

State the differences between fixed capital method and fluctuating capital method.

26.

State the differences between double entry system and incomplete records.

Generic 2

1 x 2 = 2

27.

The credit revenue from operations of Harini Ltd. amounted to Rs.9,60,000. Its debtors and bills receivable at the end of the accounting period amounted to Rs.1,00,000 and Rs.60,000 respectively. Calculate trade receivable turnover ratio and also collection period in months.

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Answers Key:

Generic 3

20 x 3 = 60

Calculation of sacrificing ratio
Sacrificing ratio = Old share - New share
Malathi \(=\frac { 5 }{ 9 } -\frac { 3 }{ 6 } =\frac { 30-27 }{ 54 } \)
\(=\frac { 3 }{ 54 } =\frac { 1 }{ 18 } \)
Shobana \(=\frac { 4 }{ 9 } -\frac { 2 }{ 6 } =\frac { 24-18 }{ 54 } =\frac { 6 }{ 54 } =\frac { 2 }{ 18 } \)
Therefore sacrificing ratio is \(\frac { 1 }{ 18 } :\frac { 2 }{ 18 } \) (or) 1:2

Journal Entry
Particulars	Debit Rs.	Credit Rs.
Bank A/c Dr	6,000
To Malathi's current A/c (1/3)		2,000
To Shoban's current A/c (2/3)		4,000
(Cash brought for goodwill credited to old partners capital account in sacrificing ratio)

Following are the journal entries to be passed to record the revaluation of assets and liabilities
Particulars		Debit Rs.	Credit Rs.
1. For increase in the value of asset
Concerned asset A/c	Dr	XXX
To Revaluation A/c			XXX
2. For decrease in the value of asset
Revaluation A/c	Dr	XXX
To Concerned asset A/c			XXX
3. For increase in the amount of liabilities
Revaluation A/c	Dr	XXX
To Concerned liabilities A/c			XXX
4. For decrease in the amount of liability
Concerned liability A/c	Dr	XXX
To Revaluation A/c			XXX
5. For recording an unrecorded asset
Concerned asset A/c	Dr	XXX
To Revaluation A/c			XXX
6. For recording an unrecorded liability
Revaluation A/c	Dr	XXX
To Concerned liability A/c			XXX
7. For transferring the balance in revaluation Alc
(a) If there is profit on revaluation
Revaluation A/c	Dr	XXX
To Old partner's capital A/c (individually in old ratio)			XXX
(b) If there is loss on revaluation
Old partner's capital Alc (individually in old ratio)		XXX
To Revaluation Ale			XXX

(a) If profit is to be distributed on the basis of the previous year's profit
Rathi's share of profit for 3 months
= \(32,000\cfrac { 3 }{ 12 } \times \cfrac { 1 }{ 5 } =Rs.100\)

Particulars		Debit Rs	Creditl Rs
Profit and loss suspense A/c	Dr	1,600
To Rathi's capital A/c			1,600
(Profit is to be distributed as the basis of previous year profit)

(b) If profit is to be distributed on the basis of average profit of the past 4 years
Average profit = \(\cfrac { 10,000+20,00+18,000+32,000 }{ 4 } \)
= \(\cfrac { 80,000 }{ 4 } =Rs20,000\)
Rathi's share of profit for 3 months
= \(20,000\times \cfrac { 1 }{ 5 } \times \cfrac { 3 }{ 13 } =Rs.1000\)

Date	Particulars		Debit Rs	Credit Rs
2018	Profit and loss suspense A/c	Dr.	1,000
March 31	To Rathi's capital A/c			1,000
	(Rathi's current year share of profit credited to her capital account)

In the books of Gemini Ltd. Journal entries
Particulars		Debit Rs.	Credit Rs.
Equity share capital A/c (20 × 7)	Dr.	140
To Equity share first call A/c (20 × 2)			40
To Forfeited shares A/c (20 × 5)			100
(Forfeiture of 120 shares, Rs.7 called up)
Bank A/c (15 × 6)	Dr.	90
Forfeited shares A/c		15
To Equity share capital A/c (15 × 7)			105
(Reissue of 15 forfeited shares @ Rs.6 per share)
Forfeited shares A/c	Dr	60
To Capital reserve A/c			60
(Gain on reissue of forfeited shares transferred to capital reserve account)

Note:
Computation of transfer to capital reserve

Forfeited amount for reissued shares of 15	= \(\frac{100}{20}\times\)15	= 75
Less: Loss on reissue		15
Transfer to capital reserve		60

Remaining balance in shares forfeited account Rs. 25 will appear in the balance sheet. Accountancy.

(i) Operating profit ratio gives the proportion of operating profit to revenue from operations.
(ii) Operating profit ratio is an indicator of operational efficiency of an organisation.
(iii) It may be computed as follows: Operating profit ratio
= \(\frac { Operating\ profit }{ Revenue\ from\ operations } \times 100\)
Alternatively, it is calculated as under.
Operating profit ratio = 100% - Operating cost ratio
Operating profit = Revenue from operations - Operating cost
(iv) A higher ratio indicates better profitability. Greater the operting ratio, higher is the margin available for paying non-operating expenses.

Following are some of the major accounting vouchers used in an organisation:
(i) Receipt Voucher
(ii) Payment Voucher
(iii) Contra Voucher
(iv) Purchase Voucher
(v) Sales Voucher
(vi) Journal Voucher

(i) Under this method, goodwill is the excess of capitalised value of average profit of the business over the actual capital employed in the business.
Goodwill = Total capitalised value of the business - Actual capital employed
(ii) The total capitalised value of the business is calculated by capitalising the average profits on the basis of the normal rate of return.
Capitalised value of the business
\(=\frac{Average\ profit}{Normal\ rate of\ return}\times 100\)
(iii) Actual capital employed = Fixed assets (excluding goodwill ) + Current assets - Current liabilities

Average profit \(=\frac{Total\ profit}{Number\ of\ years}\)
\(=\frac{10,000+12,000+12,000+11,500}{4}\)
\(=\frac{46,000}{4}\) = Rs.11,500

Average profit before adjusting fair remuneration of the parter	= Rs. 11,500
Less: Fair remuneration of partners	= Rs. 1,500
Average profit	= Rs. 10,000

Goodwill Average profit \(\times\) Number of years of purchase
= 10,000 \(\times\) 3
= Rs. 30,000
Goodwill = Rs. 30,000

Salary to Kamali = Rs.10,000 \(\times\) 12 = Rs. 1,20,000
Commission to Lakshmi = Rs. 40,000

Journal entries
Particulars	Debit Rs.	Credit Rs.
Kamali's salary A/c Dr	1,20,000
To Kamali's capital A/c		1,20,000
(Kamali's salary transferred to his capital account)
Lakshmi's commission A/c Dr	40,000
To Kamali's capital A/c		40,000
(Lakshmi's commission transferred to his capital account)
Profit and loss appropriation A/c Dr	1,60,000
To Kamali's salary A/c		1,20,000
To Lakshmi's commission A/c		40,000
(Salary and commission account transferred)

10.

Particulars	Subha Rs.	Sudha Rs.
Capital on 31^st December 2018	40,000	60,000
Add: Drawings	8,000	10,000
	48,000	70,000
Less: Profit already creditted	12,000	18,000
Capital on 1^st January 2019	36,000	52,000

Calculation of interest on capital:
Subha:
On opening capital = 36,000 \(\times\) \(\frac{5}{100}\) = Rs. 1,800
Sudha:
On opening capital = 52,000 \(\times\) \(\frac{5}{100}\) = Rs. 2,600

11.

**Calculation of adjusted profit**
Particulars	2016 Rs.	2017 Rs.	2018 Rs.
Profit	30,000	29,000	32,000
Less: Non- recurring income	3,000	-	-
	27,000	29,000	32,000
Add: Stock destroyed by fire (abnormal loss)	-	2,000	32,000
Profit after adjustments	27,000	31,000	32,000

Average profit = \(\frac { Total\ profit }{ Number\ of\ year } \)
Average profit = \(\frac { 27,000+31,000+32,000 }{ 3 } \)
= \(\frac { 90,000 }{ 3 } \) = Rs. 30,000

Particulars	Rs.
Average profit before adjusting insurance premium payable	30,000
Less: Insurance premium payable in future	5,600
Average profit	24,400

Goodwill = Average profit \(\times\) Number of years of purchase
= 24,400 \(\times\) 2
= Rs. 48,800

12.

Calculation of interest on drawings under product method.
Date of drawings Amount withdrawn
Rs. Period up to December 31
(months) Product
Rs. March 1 6,000 10 60,000 June 1 4,000 7 28,000 September 1 5,000 4 20,000 December 1 2,000 1 2,000 1,10,000 Interest on drawings = Sum of product \(\times\) Rate of interest \(\times\) \(\frac{1}{12}\)
= 1,10,000 \(\times\) \(\frac{12}{100}\) \(\times\) \(\frac{1}{12}\) = Rs.1,100

13.

Particulars	Brindha		Praveena
Particulars	Rs.	Rs.	Rs.	Rs.
Capital on 31st December 20		30,000		40,000
Add: Drawings		5,000		7,000
		35,000		47,000
Less:
Additional capital	6,000		10,000
Profit already credited*	9,000	15,000	12,000	22,000
Capital on 1^st January		20,000		25,000

Profit credited = Profit earned Rs. 31,000 – Balance profit as per balance sheet Rs. 10,000 = Rs. 21,000. This amount is distributed in their profit sharing ratio of 3:4.

Calculation of interest on capital:
Brindha:

On opening capital for 1 year	20,000 \(\times\) \(\frac{6}{100}\)	Rs. 1,200
On additional capital for 6 months	6,000 \(\times\) \(\frac{6}{100}\) \(\times\) \(\frac{6}{12}\)	Rs. 180
Total Interest on capital		Rs. 1,380

Praveena:

On opening capital for 1 year	25,000 \(\times\) \(\frac{6}{100}\)	Rs. 1,500
On additional capital for 3 months	10,000 \(\times\) \(\frac{6}{100}\) \(\times\) \(\frac{3}{12}\)	Rs. 150
Total interest on capital		Rs. 1.650

14.

Dr Income and Expenditure Account for the year ended Cr
Income	Rs	Rs
By Subscription	2,350
(+) outstanding sub. (10 \(\times\) 25)	250
	2600
(-) Subs. Received Adv. (4 \(\times\) 25)	100	2,500

Dr. Balance sheet Cr.
Liabilities	Rs	Assets	Rs
Subscription received in advance	100	Outstanding subs	250

15.

(A) Treatment in income and Expenditure account:
When subscription received for the current year, previous years and subsequent period are given separately, subscription received for the current year will be shown on the credit side of Income and Expenditure
Account after making the adjustments given below:
(i) Subscription outstanding for the current year is to be added.
(ii) Subscription received in advance in the previous year which is meant for the current year, is to be added.When 'total subscription received during the current year is given, that total subscriptions received during the current year will be shown on the credit side of Income and Expenditure Account after making the following-adjustments: (i) Subscription outstanding in the previous year which is received in the current year will be subtracted. Subscription outstanding for the current year is added.
(iii) Subscriptions received in advance in the previous year which is meant for the current year, is added and subscriptions received in advance in the current year which is meant for the subsequent year must be subtracted.
(B) Treatment in Balance Sheet
(i) Subscriptions outstanding for the current year and still outstanding for the previous year will be shown on the assets side of the balance sheet.
(ii) Subscriptions received in advance in the current year will be shown on the liabilities side of the balance sheet.

16.

Dr. Income and Expenditure Account for the year ended 31^st March, 2017 Cr
Income	Rs.	Rs.
By Subscription	25,000
Less: Subscription for the year 2015-16	2,000
	23,000
Less: Subscription for the year 2017-18	1,500
	21,500
Add: Outstanding subscription for the year 2016-17	500	22,000

Balance sheet as on 31^st March, 2017
Liabilities	Rs.	Assets	Rs.
Subscription received in advance for the year 2017-18	1,500	Outstanding subscription for the year 2016-2017	500

17.

Dr. Receipts and Payments Account for the year ended
31^st March, 2019 Cr
Receipts	Rs.	Payments	Rs.
To Balance b/d		By Rent paid	6,000
Cash in hand	18,000	By Scholarship given	15,200
To Entrance fees	18,500	By Building purchased	2,10,000
To Subscription received	2,65,000	By Staff salary	55,000
		By Balance c/d
		Cash in hand	15,300
	3,01,500		3,01,500

18.

In the books of Thomas Statement of affairs as on
31^st March 2019
Liabilities	Rs.	Assets	Rs.
Sundry creditors	6,00,000	Furniture	80,000
Bills payable	1,20,000	Land and building	3,00,000
capital (Balancing figure)	2,80,000	Sundry debtors	3,20,000
		Cash in hand	20,000
		Bills receivable	60,000
		Stock	2,20,000
	10,00,000		10,00,000

19.

**Dr. Bills receivable account Cr.**
Particulars	Rs.	Particulars	Rs
To Balance b/d	40,000	By Cash A/c	90,000
To Debtors A/c*	90,000	By Debtors A/c	10,000
(Bills received during the year – balancing figure)		(Bills receivable dishonoured)
		By Balance c/d	30,000
	1,30,000		1,30,000

**Dr. Total debtors account Cr**
Particulars	Rs	Particulars	Rs
To Balance b/d	1,50,000	By Cash A/c	3,90,000
To Bills receivable A/c (dishonoured)	10,000	By Sales returns A/c	40,000
To Sales A/c (credit)	4,90,000	By Bills receivable A/c*	90,000

		By Balance c/d	1,30,000
	6,50,000		6,50,000

Total Sales = Cash Sales + Credit Sales = Rs. 2,00,000 + Rs. 4,90,000 = Rs. 6,90,000.
(iii) Format of total creditors account

**Dr. Total creditors account Cr.**
Particulars	Rs	Particulars	Rs
To Cash A/c (paid)	xxx	By Balance b/d	xxx
To Bank A/c (cheques paid)	xxx	(opening balance)
To Bills payable A/c		By Purchases A/c	xxx
(bills accepted)	xxx	(credit purchases)
To Discount received A/c	xxx	By Bank A/c	xxx
To Purchase returns A/c	xxx	(cheques dishonoured)
To Balance c/d	xxx	By Bills payable A/c	xxx
(closing balance)		(dishonoured )
	xxx		xxx

20.

Statement of profit or loss for the year ended 31^st March, 2018
Particulars	Rs
Closing capital (as on 31.3.2018)	2,75,000 20,000
Add: Drawings during the year (balancing figure)	2,75,000 20,000
	2,95,000 30,000
Less: Additional capital introduced during the year	2,95,000 30,000
Adjusted closing capital	2,65,000 2,50,000
Less: Opening capital (as on 1.4.2017)	2,65,000 2,50,000
Profit made during the year	15,000

Generic 5

6 x 5 = 30

21.

Basic Sacrificing ratio Gaining ratio 1. Meaning It is the proportion of the profit which is sacrificed by the old partners in favour of a new partner It is the proportion of the profit which is gained by the continuing partners from the retiring partner 2. Purpose It is calculated to determine the amount to be adjusted towards goodwill for the sacrificing partners It is calculated to determine the amount to be adjusted towards goodwill for the gaining partners 3. Method of Calculation It is the difference between the old ratio and the new ratio Sacrificing ratio = Old profit sharing ratio - New profit sharing ratio It is the difference between the new ratio and the old ratio Gaining ratio = New profit sharing ratio - Old profit sharing ratio 4. Time of calculation It is calculated at the time of admission of a new partner It is calculated at the time of retirement of a partner

22.

Date	Particulars		Debit Rs.	Credit Rs.
2018 April 1	Premises A/c	Dr.	40,000
	To Revaluation A/c			40,000
	(Value of premises increased)
"	Revaluation A/c	Dr.	10,000
	To Stock A/c			3,000
	To Machinery A/c			6,500
	To Outstanding liability A/c			500
	(Decrease in value of assets and outstanding liability recorded)
"	Revaluation A/c	Dr.	30,000
	To Ramya's capital A/c			15,000
	To Sara's capital A/c			9,000
	To Thara's capital A/c			6,000
	(Profit on revaluation distributed)

Dr. Revaluation account Cr.
Particulars	Rs.	Rs.	Particulars	Rs.
To Stock A/c		3,000	By Premises A/c	40,000
To Machinery A/c		6,500
To Outstanding liability A/c		500
To Profit on revaluation transferred to
Ramya's capital A/c (5/10)	15,000
Sara's capital A/c (3/10)	9,000
Thara's capital A/c (2/10)	6,000	30,000
		40,000		40,000

23.

Common–size income statement of Siva Ltd for the year ended 31st March, 2016 and 31st March, 2017
Particulars	Absolute amount 2015-16	Percentage of revenue from operations for 2015-16	Absolute amount 2016-17	Percentage of revenue from operations for 2016-17
	Rs.	Rs.	Rs.
Revenue from operations	2,00,000	100.00	3,00,000	100
Add: Other income	25,000	12.50	75,000	25
Total revenue	2,25,000	112.50	3,75,000	125
Less: Expenses	2,50,000	125.00	1,50,000	50
Profit / loss before tax	-25,000	-12.50	2,25,000	75
Less: Income tax (40%)	-	-	2,25,000	30
Profit after tax	-25,000	-12.50	1,35,000	45

24.

**Journal entries**
Date	Particulars		Debit Rs.	Credit Rs.
2017	Stock A/c	Dr.	5,000
April 1	Investment A/c	Dr.	7,000
	To Revaluation A/c (Increase in the value of stock and unrecorded investment accounted)			12,000
"	Revaluation A/c	Dr.	19,500
	To Office equipment A/c			10,000
	To Outstanding wages A/c (Reduction in the value of office equipment and provision of outstanding wages recorded)			9,500
"	Sriram’s capital A/c	Dr.	5,000
	Raj’s capital A/c	Dr.	2,500
	To Revaluation A/c (Loss on revaluation transferred)			7,500

**Dr. Revaluation Account Cr.**
Particulars	Rs.	Particulars	Rs.	Rs.
To Office equipment A/c	10,000	By Stock A/c		5,000
To Outstanding wages A/c	9,500	By Investment A/c		7,000
		By Loss on revaluation transferred to
		Sriram’s capital A/c (2/3)	5,000
		Raj’s capital A/c (1/3)	2,500	7,500
	19,500			19,500

25.

Basis of destination	Fixed capital method	Fluctuating capitals method
Number of accounts	Two accounts are maintained for each partner, that is, capital account and current account.	Only one account, that is, capital account is maintained for each partner.
Change in capital	The amount of capital normally remains unchanged except when additional capital is introduced or capital is withdrawn permanently	The amount of capital changes from period to period.
Closing balance	Capital account always shows a credit balance	Capital account generally shows credit balance. It may also show a debit balance.
Adjustments	All adjustments relating to interest on capital, interest on drawings, salary or commission, share of profit or loss are done in current account	All adjustments relating to interest on capital, interest on drawings, salary or commission, share of profit or loss are done in the capital account

26.

S.No	Basis of distinction	Double entry system	Incomplete records
1.	Recording of transaction	Both debit and credit aspect of all the transaction are recorded.	Debit and credit aspect of all the transaction are not recorded completely for some transaction. both aspect are entered some transaction are particularly recorded and some transaction are omitted to be.
2.	Type of account maintained	Personal, real and nominal accounts are maintained fully	In General, only personal and cash account are maintained fully real and nominal account are not maintained fully.
3.	Preparation of trial balance	Trial balance can be prepared to check the arithmetical accuracy of the entries made in the books of accounts.	It is difficult to prepared the trial balance to check arithmetical accuracy of entries made in the books of account as the account are incomplete.
4.	Suitability	trading and profit or loss account can be prepared to find out the true profit or loss.	Trading and profit and loss account cannot be prepared with accuracy as complete. information is not available and hence profit or loss found out may not be accurate.
5.	Reliability	Balance sheet can be prepared to know the true financial position.	Balance sheet cannot be prepared with accuracy and true financial position cannot be ascertained. as the asset and liabilities are just estimate and incomplete.

Generic 2

1 x 2 = 2

27.

Trade receivables turnover ratio = \(\frac{Credit\ revenue\ from\ operations}{Average\ trade\ receivables}\) = \(\frac{9,60,000}{1,60,000}\) = 6 times
Trade receivables = Debtors + Bills receivable = 1,00,000 + 60,000 = Rs.1,60,000