CHENNAI SAHODAYA SCHOOLS COMPLEX

(General Instructions)
1. Please check that this question paper contains 34 questions.
2. Question from 1 to 16 and 27 to 30 carries one mark each.
3. Question from 17 to 20 and 31 & 32 carries 3 marks each.
4. Questions from 21, 22 and 33 carries 4 marks each.
5. Questions from 23 to 26 and 34 carries 6 marks each.
6. There is no overall choice. However, an internal choice has been provided in 7
questions of one mark, 2 questions of three marks, 1 question of four marks
and 2 questions of six marks
7. Please write down the serial number of the question before attempting it.
8. Reading time of 15 minutes is given to read the question paper alone. No
writing during this time.
COMMON EXAMINATION
Class-12
(Accountancy - 055)
Roll No.: Maximum Marks:80
Date: Time allowed: 3 hours
PART – A
(Accounting for Partnership Firms and Companies)

1 Abhilash, Kala and Sekar are partners in a firm. Abhilash gives a guarantee to the 1
effect that gross fee earned by him for the firm shall be equal to his average gross
fee of the preceding five years when he was carrying on profession alone, which on
an average works out to Rs. 75,000. The Gross fee earned by Abhilash for the firm
is Rs. 40,000. Abhilash account will be _________ by_________.
a. Credited, Rs. 35,000 b. Debited, Rs. 35,000
c. Debited, Rs. 40,000 d. Credited, Rs. 75,000
2 There are two statements Assertion (A) and Reason (R) 1
Assertion (A): Fixed Capital Accounts of Partners always show credit balances
even when the firm suffers losses year after year.
Reason (R): Current Accounts of Partners are maintained under fluctuating capital
method.
Choose the correct option from the following:
a. Both Assertion (A) and Reason (R) are correct, and Reason (R) is not the correct
explanation of Assertion (A).
b. Both Assertion (A) and Reason (R) are correct, and Reason (R) is the correct
explanation of Assertion (A).
c. Both Assertion (A) & Reason (R) are false.
d. Only Assertion (A) is true.
3 Issue of shares for consideration other than cash increases the ________capital. 1
a. Authorized b. Reserve c. Subscribed d. Venture
(OR)
Ramba Ltd. issued 1,00,000, 9% Debentures of Rs.100 each at 10% discount and
redeemable at a premium. Loss on Issue of Debentures of Rs.20,00,000 was
written off from Securities Premium Rs.10,00,000 and Statement of Profit and
Loss Rs.10,00,000. The redemption value of each debenture will be:
a. Rs.120 b. Rs.110 c. Rs.100 d. Rs.105
4 Pavan and Jeya are partners in a firm sharing profits and losses in the ratio of 3:2. 1
Their capitals were Rs.6,40,000 and Rs.4,00,000 respectively. Sathya was admitted
for 1/5th share in the profits of the firm. He brought Rs.4,80,000 as his capital. The
Goodwill of the firm will be:
a. Rs.8,80,000 b. Rs.1,76,000 c. Rs.13,60,000 d. Rs.2,72,000
(OR)

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Arun and Vijay are partners in a firm sharing profits and losses in the ratio of 5:1.
They admitted Rangu into partnership.
Balance Sheet (Extract)
Liabilities Rs, Assets Rs.
Machinery 40,000
If the value of machinery reflected in the Balance Sheet is overvalued by 33⅓%,
find out the value of Machinery to be shown in the new Balance Sheet after the
admission.
a. Rs. 44,000 b. Rs. 48,000 c. Rs. 32,000 d. Rs. 30,000
5 Average capital employed in a firm is Rs.3,00,000. The normal rate of return in the 1
business is 20% and firm’s average profits are Rs. 80,000. Value of goodwill by
capitalization of Super Profit method is
a. Rs.8,00,000 b. Rs.1,00,000 c. Rs.2,00,000 d. Rs.6,00,000
6 Krishna had applied for 1,800 shares, and was allotted in the ratio of 3:2. He had 1
paid application money of Rs.3 per share and couldn’t pay allotment money of Rs.5
per share. First and Final call of Rs.2 per share was not yet made by the company.
The amount of calls in arrears in the allotment stage is:
a. Rs. 6,000 b. Rs. 5,200 c. Rs. 6,200 [Link]. 4,200
(OR)
Reliance Limited forfeited 300 shares of Rs.10 each on which Rs.8 called up and
Rs.6 was received, the forfeiture account should be credited by
a. Rs. 2,400 [Link]. 1,200 c. Rs. 1,800 d. Rs.600
7 Diksha Ltd issued 4,000, 9% Debentures of Rs.100 each at a discount of 10%, 1
redeemable at a premium. If the amount of ‘Loss on Issue of Debentures Account’
was Rs. 60,000, then the amount of premium on redemption was
a. Rs. 60,000 b. Rs. 40,000 c. Rs. 20,000 d. Rs. 80,000
8 At the time of dissolution of a firm, the total assets were Rs.6,00,000 and outside 1
liabilities were Rs.2,40,000. If assets realized Rs.7,20,000 and realization expenses
of Rs. 8,000 were paid, the profit or loss on realization will be:
a. Loss Rs.1,20,000 b. Profit Rs.1,20,000 c. Loss Rs.1,12,000 d. Profit
Rs.1,12,000(1)
(OR)
Indira and Rao are partners sharing profits and losses in the ratio of 5:3. They
decided to dissolve the firm. On the date of dissolution their Balance Sheet showed
Investments-Rs.5,00,000 and Investment Fluctuation Reserve-Rs.1,00,000. The
Investment Fluctuation Reserve will be transferred to the
a. Credit of Partners’ Capital Accounts b. Debit of Partners’ Capital Accounts
c. Credit of Realization Account d. Debit of Realization Account

9 Raji a partner withdrew Rs. 5,000 per month from 1st April,2024 to 1st 1
September,2024. Interest on Drawings is chargeable at 10% p.a. Raji’s Interest on
Drawings as on 31st March, 2025.
a. Rs. 2,735 b. Rs. 2,375 c. Rs. 2,675 d. Rs. 2,765
10 On dissolution of a firm, debtors Rs. 17,000 were shown in the Balance Sheet. 1
Out of this Rs. 2,000 became bad. One debtor become insolvent 70% were
recovered from him out of Rs. 5,000. Full amount was recovered from the balance
debtors. On account of this item, loss in realization account will be:
a. Rs. 5,100 b. Rs. 1,500 c. Rs. 3,500 d. Rs. 2,000
11 Ramani, Vinoth, Reshma and Keerthana are partners in a firm sharing profits and 1
losses in the ratio of [Link]. They want to expand the business and hence wanted
to admit partners in their firm. How many additional partners can be admitted
into the business as per the provisions of the Companies Act, 2013?
a. Rs. 50 b. Rs. 46 [Link]. 100 [Link]. 96
12 If all the forfeited shares are reissued and discount on reissue of shares is less than 1
the amount forfeited the balance in Forfeited Shares Account is transferred to
a. Capital Reserve b. General Reserve
c. Securities Premium d. Statement of the Profit and Loss
13 Menaka Ltd. purchased a Building for Rs.12,00,000 out of which Rs.2,00,000 1
were paid in cash. Balance amount was paid by issue of equity shares of Rs.10
each at 25% premium. How many shares will be issued by the company?
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a. 1,00,000 shares b. 80,000 shares c. 1,20,000 shares d. 96,000 shares

14 Red, Blue and White were partners in a firm sharing profits in the ratio of [Link]. 1
They decided to share future profits in the ratio of [Link] with effect from 1st April
2024. Their Balance Sheet as on that date showed a balance of Rs. 22,500 in
Advertisement Suspense Account. Which is the correct treatment?
a. Debit to Partners’ Capital Accounts Rs. 7,500, Rs. 7,500 and Rs. 7,500
b. Debit to Partners’ Capital Accounts Rs. 4,500, Rs. 9,000 and Rs. 9,000
c. Credit to Partners’ Capital Accounts Rs. 7,500, Rs. 7,500 and Rs.7,500
d. Credit to Partners’ Capital Accounts Rs. 4,500, Rs. 9,000 and Rs. 9,000
15 Shanta and Kamal entered into partnership on 1/4/2024. On the above date they 1
admitted Netran as new partner for 1/6th share in the profits which he acquired
equally from Shanta and Kamal. The new profit sharing ratio of Shanta, Kamal
and Netran was [Link]. Calculate the profit sharing ratio at the time of forming the
partnership.
a. 5:3 b.3:5 c. 5:7 d. 7:5

(OR)
A, B and C were partners sharing profits in the ratio of their Capital contribution
which were Rs.6,00,000; Rs.4,00,000 and Rs.5,00,000 respectively. Their books
are closed on 31st March every year. A died on 13th June2024. Under the
partnership deed, deceased partner is entitled to his share of profit/loss to the date
of death based on the average profits of preceding three years. Profits were 2021-
Rs. 15,000; 2022- (Rs.25,000); 2023-Rs.1,00,000 and 2024-Rs.1,50,000. A’s
share of profit/loss will be:
a. Rs. 8,000 b. Rs. 6,000 c. Rs. 5,000 d. Rs. 9,000
16. Boat and Noise are partners in a firm. They admit Apple on 1st April, 2024, for 1
1/4th share in the profits of the firm. Apple acquired her share as 1/12th from Boat
and the remaining from Noise.
The sacrificing ratio of the old partners will be:
a. 11:12 b. 1:1 c. 1:2 d. 1:11
17 Radha and Mudit were partners in a firm sharing profits and losses in the ratio of 3
3:2. The firm was dissolved on 31st March,2024. Pass the necessary journal
entries for the following transactions after various assets (other than cash in hand
and cash at bank) and third party liabilities have been transferred to Realization
Account:
a. A creditor of Rs. 70,000 accepted Furniture valued at Rs. 75,000 in full
settlement.
b. Bank Loan of Rs. 90,000 was settled along with interest of Rs. 9,000.
c. Realization expenses amounting to Rs. 8,000 were paid by Mudit.
18 A, B and C were partners in a firm sharing profits in the ratio of [Link]. The firm 3
closes its books on 31st March every year. B died on 12th June 2024. On B’s death
the goodwill fo the firm was valued at Rs. 60,000. On B’s death his share in the
profits of the firm till the time of his death was to be calculated on the basis of
previous year’s profit which was Rs.1,50,000. Calculate B’s share in the profit of
the firm. Pass necessary journal entries for the treatment of goodwill and B’s share
of profit at the time of his death.
(OR)
On 1st April, 2024, the books of a partnership firm showed assets of Rs.10,00,000
including cash of Rs. 46,000 and Bank balance of Rs. 54,000. The Partners’ capital
accounts showed a balance of Rs.6,00,000 and reserves constituted the rest. If the
normal rate of return is 10% and the Goodwill of the is valued at Rs.2,00,000 at 4
years’ purchase of super profits, find the average profits of the firm.
19 Annex Ltd. issued 1,00,000 shares of Rs.10 each at a premium of 10% to the public 3
for subscription. The whole amount was payable on application. Applications
were received for 3,00,000 shares and the board decided to allot shares to all
shareholders on pro-rata basis.
Pass necessary journal entries for the above transactions in the books of Annex
Ltd.
(OR)

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Indrani Ltd. forfeited 2,000 shares of Rs.10 each, fully called-up, on which they
had received only Rs. 14,000. 1,000 of the forfeited shares were reissued by giving
maximum permissible discount as fully paid up.
Pass necessary journal entries for forfeiture and reissue of shares.
20 A, B and C are partners in a firm sharing profits and losses in the ratio of [Link]. C 3
retires from the firm and A and B agree to share future profits equally. Give
Journal entries on C’s retirement in the following cases:
a. Workmen Compensation Reserve appears in the books at Rs.1,00,000, when
there is a claim of Rs. 40,000 on it.
b. Workmen Compensation Reserve appears in the books at Rs.2,00,000, when
there is a claim of Rs.3,20,000 on it.
21 Vetri India Ltd. was registered with an authorized capital of Rs.10,00,000 divided 4
into 1,00,000 equity shares of Rs.10 each. The company offered to the public for
subscription 80,000 Equity Shares payable per share as: Rs.3 on application, Rs.2
on allotment, Rs.3 on first call and the balance on second and final call. The issue
was fully subscribed and all amounts due were received except the first and final
call money on 2,000 shares allotted to Kumari. Her shares were forfeited.
Present the ‘Share Capital’ in the Balance Sheet of the company as per Schedule
III, Part I of the Companies Act, 2013. Also prepare ‘Notes to Accounts’
22 Sunny, Vaibhav and Mita were partners in a firm sharing profits and losses in the 4
ratio of [Link]. Sunny retired on 31st March, 2024. After making all the adjustments
relating to revaluation, goodwill and accumulated profit etc. the Capital Accounts
of Vaibhav and Mita showed a credit balance of Rs.1,00,000 and Rs. 50,000
respectively. It was decided to adjust the capitals of Vaibhav and Mita in their
new profit-sharing ratio which was equal.
Calculate the new capitals of the partners, Gaining Ratio and pass necessary
journal entries for bringing in or withdrawal of the necessary amounts by the
partners.
23 Kavita Ltd. invited applications for issuing 40,000 shares of Rs.10 each at a 6
premium of Rs.2 per share. The amount was payable as follows:
On Application-Rs.4 per share
On Allotment-Rs.5 per share
On First Call -Rs.2 per share
On Second and Final Call-Balance
Applications were received for 60,000 shares. Applications for 12,000 shares were
rejected and money returned to the applicants. The Balance shares were allotted
on pro-rata basis. The excess money received on application was adjusted towards
sums due on allotment.
All shareholders paid the allotment money except one shareholder Baji who had
applied for 1,200 shares. His shares were forfeited immediately after allotment.
First call was made thereafter and the money due was received. The second and
final call was not yet made.
Journalize the above transactions in the books of the company.
(OR)
Lakshmi Ltd. issued 635, 9% Debentures of Rs.500 each.
Pass necessary journal entries for the issue of debentures in the following
situations:
a. When debentures were issued at 5% discount, redeemable at 10% premium.
b. When debentures were issued at 12% premium, redeemable at 6% premium.
24 Chintan, Ayush and Sudha were partners in a firm sharing profits and losses in the 6
ratio of [Link]. On 31st March, 2024, their Balance Sheet was as follows:

Liabilities Rs Assets Rs.

Capitals: Building 90,000
Chintan 90,000 Machinery 60,000
Ayush 60,000 Stock 30,000
Sudha 40,000 1,90,000 Debtors
60,000
Provident Fund 30,000 Less Provision 55,000
5,000
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General Reserve 20,000 Cash at Bank 15,000

Creditors 10,000
Total 2,50,000 Total 2,50,000
Chintan retired on the above date and it was agreed that:
a. Debtors of Rs. 5,000 were to be written off as bad debts and a provision of 5%
on debtors for bad and doubtful debts was to be created.
b. Goodwill of the firm on Chintan’s retirement was valued at Rs. 1,00,000 and
Chintan’s share of the same will be adjusted by debiting the capital accounts of
Ayush and Sudha.
c. Stock was revalued at Rs. 36,000.
d. Furniture was undervalued by Rs. 9,000.
e. Amount due to Chintan was transferred to his Loan Account.
Pass the necessary journal entries in the books of the firm on Chintan’s retirement.

(OR)
A, B and C were partners in firm sharing profits and losses in the ratio of [Link].
On 1st April, 2023 the balances in their Capital and Current Accounts were as
follows:
Partners Capital Accounts-Rs. Current Accounts-Rs.
A 4,00,000 20,000 Dr.
B 5,00,000 10,000 Dr.
C 6,00,000 15,000 Dr.
Their Partnership provided for the following:
1. Interest on Capital @ 8% p.a.
2. Salary to A @ Rs. 30,000 per quarter.
On 1st January, 2023, C had given a loan of Rs.1,00,000 to the firm @ 6% p.a.
interest. During the year their drawings were A-Rs. 40,000, B-Rs.75,000 and C-
Rs.55,000. On 1st January, 2024, A introduced further capital Rs.2,00,000. The
net profit of the firm before allowing interest on C’s Loan was Rs.5,00,000.
Prepare Profit & Loss Appropriation Account of the firm for the year ending 31 st
March, 2024 and he Current Accounts of the partners.
25 Aadish and Shreyansh were partners in a firm sharing profits and losses in the ratio 6
of 3:2. On 31st March, 2024 their Balance Sheet was as follows:
Liabilities Rs Assets Rs.
Creditors 90,000 Cash at Bank 20,000
Mrs. Aadish’s Loan 30,000 Stock 24,000
Shreyansh’s Loan 30,000 Investments 30,000
General Reserve 45,000 Debtors 20,000
Capitals Less Provision 2,000 18,000
Aadish 1,00,000 Plant 1,00,000
Shreyanash 97,000 1,97,000 Advertisement 2,00,000
Suspense A/c.
Total 3,92,000 Total 3,92,000
The firm was dissolved on the above date on the following terms:
1. Debtors realized Rs. 17,000 and Plant realized 10% more than the book value.
2. Aadish promised to pay [Link]’s loan and took away stock at Rs. 20,000.
3. Shreyansh took away half of the investments at a discount of 10%. Remaining
investments realized Rs. 4,500.
4. Creditors were paid off at a discount of 10%.
5. Expenses of realization amounted to Rs. 7,000.
Prepare Realization Account.
26 [Link] Ltd obtained a loan of Rs.10,00,000 from Royal Bank of Scotland, 4+2
Mumbai. The company issued 20,000 10% Debentures of Rs.100 each as a
collateral security for the same. Journalize the above transactions and also show
how these items will be presented in the Balance Sheet of the Company in both
the cases i.e. 1. With Journal Entry and 2. Without Journal Entry.
[Link] Limited took over assets of Rs.60,00,000 and liabilities of Rs.10,00,000
from Krishna Limited for an agreed purchase consideration of Rs.45,00,000. The
amount was payable by issue of 10% Debentures of Rs.100 each at a discount of
10%.
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Journalize the above transactions in the books of the company.

PART B (Analysis of Financial Statements)
27 ‘Freedom to choose the method of depreciation’ refers to which limitation of 1
Financial Statement Analysis:
a. Historical Analysis b. Qualitative aspect ignored
c. Not free from bias d. Ignores price level changes
(OR)
Quick Ratio of Mohana Ltd is 1.2:1. State with reason, what will be the impact of
purchase of goods on credit on this ratio?
28 The Debt to Equity ratio of Padma Ltd. is 1:2. State with reason whether ‘Issue of 1
bonus shares’ will increase, decrease or not change the ratio.
29 While computing cash flow from investing activities, which of the following 1
item(s) will be shown as inflow?
1. Interest received 2. Interest paid 3. Sale of Building 4. Purchase of Furniture
a. Only 1 b. only 1 and 2 c. Only 1 and 3 d. All the 4
(OR)
Choose the transaction which is partly shown in investing and partly in Financing
Activity.
a. Purchase of Goods on credit b. Car purchased on credit.
c. Purchase of Goods for cash d. Van purchased on Hire Purchase Scheme.
30 Assertion (A) Purchase of property is an operating activity for a Real Estate 1
Company.
Reason (R) Purchase and sale of property and receiving of rent are the principal
revenue generating activities for a Real Estate Company.
In the context of the above two statements, which of the following is correct?
a. Both (A) and (R) are true, but (R) is not the correct explanation of (A).
b. Both (A) and (R) are true, but (R) is the correct explanation of (A).
c. Both (A) and (R) are false.
d. (A) is false, but (R) is true.
31 Find the heads and sub-heads under which the following items will appear in the 3
Balance Sheet of a company as per Schedule III, Part I of Companies Act, 2013.
a. Share Options Outstanding Account
b. Advance paid to the Vendor for purchase of Machinery.
c. Drafts on Hand
d. Provision for Doubtful Debts
e. Proposed Dividend for the Current Year.
f. Current Maturities of Long-Term Debt.
32 The following particulars are related to the Statement of Profit and Loss of Jagan 3
Ltd.
Particulars 2023-24-Rs. 2022-23-Rs.
Revenue from Operations 37,50,000 30,00,000
Other Income 75,000 60,000
Expenses 25,75,000 20,60,000
Income Tax 40% 40%
Prepare Comparative Statement of Profit and Loss.
33 Profit after tax amounted to Rs.6,00,000 and tax rate was 20%. If Earnings before
Interest and tax was Rs.10,00,000 and Nominal Value of Debentures amounted to
Rs.25,00,000 (assuming the only debt of the company), determine the rate of
interest on debentures.
(OR)
From the following information, calculate Gross Profit Ratio:
Particulars Rs.
Cash Revenue from Operations 2,00,000
Credit Revenue from Operations 8,00,000
Cash Purchases 40,000
Credit Purchases 3,60,000
Carriage Inwards 8,000
Carriage Outwards 10,000
Salaries 42,000
Decrease in Inventory 1,22,000
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Returns Outwards 20,000

Wages 20,000
34 . From the following information of Siyaram Ltd., determine Cash Flow from 6
Financing Activities:
Particulars 2023-24-Rs. 2022-23-Rs.
Equity Share Capital 60,00,000 40,00,000
8% Debentures ----- 5,00,000
7% Debentures 6,00,000 ------
Bank Overdraft 3,20,000 3,00,000
Cash and Cash Equivalents 1,50,000 1,90,000
Additional Information:
1. 8% Debentures were redeemed on 1st Jan 2024 and new 7% Debentures were
issued on the same date at a discount of 5%.
2. During the year 2023-24, Siyaram Ltd. issue bonus shares in the ratio of 2:1.
3. Interest paid on Bank Overdraft was Rs. 35,000.
4. Proposed Dividend on Equity shares for the year ended 31st March, 2023
Rs.4,00,000
5. Proposed Dividend on Equity Shares for the year ended 31st March, 2024
Rs.4,80,000.

“End of paper”

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