5. From the following trial balance and other additional Information obtained from the books of Mr. Sunil Gavaskar prepare
his trading account and the profit and loss account for the half-year ended 30 September, 2016 and his balance shee
as on that date :
Debit
Credit
1,56,000
JAns.
T. Mr. Pi
2,50,000
2,000
Capital Account 87$
Drawings Account BIS
Trade Expenses in
Cash In Hand /
Cash at Bank US
Freehold Premises )
Stock as on 1.4.2018 T
Purchases and Sales T
Returns T
Carriage Inward T
Carriage Outward plu
Sundry Debtors and Sundry Creditors B/s
Bills Receivable and Bills Payable els
Furniture and Fixtures B/s
Bad Debts P/L
Wages 7
Salaries PIL
Advertisement p/
Rent, Rates and Taxes PL
9,000
12,000
750
22,700
1,30,000
35,000
76,000
2,800
1,500
3,500
48,000
22,000
15,400
1,500
25,000
19,850
15,000
3,500
4,42,500
25,000
10,500
4,42,500
(1) Stock was valued at 240,000 on 30.9.2018.
Colombat 72 01
Answers
Answer:
Explanation:Describe about the Accounting Cycle. (2)
Question 2.
(i) Provisions contained in the Accounting Standard in respect of Revaluation of fixed assets.
(ii) Extraordinary Items to be disclosed as per the Accounting Standard. (2+2)
Question 3.
(i) Describe the reasons for differences between Cash Book and Pass Book.
(ii) D’s Cash Book shows an overdrawn position of `3,630 on 31.03.2013, though the bank Statement shows only
`3,378 overdrawn. Detailed examination of two records revealed the following:
(a) A cheque for `1,560 in favour of Rath Associates has been omitted by the Bank from its statement, thus,
cheque having been debited to another customer’s account.
(b) The debit side of owned book has been under caste by `300.
(c) A cheque for `182 drawn in payment of electricity amount had been entered in the cash Book on `128 &
was shown correctly in the bank statement.
(d) A cheque for `210 from S. Gupta having been paid into Bank, was dishonoured & shown as such on Bank
statement, although no entry relating to dishonoured had been made in Cash Book.
(e) The Bank had debited a cheque for `126 to D’s A/c, in error. It should have debited to Sukhal’s A/c.
(f) A dividend of `90 on D’s holding of equity shares has been duly shown by bank, no entry has been made
in cash book.
(g) A lodgement of `1,080 on 31.03.2013 had not been credited by Bank.
(h) Interest on `228 had been directly debited by Bank not recorded in Cash Book.
You are required to prepare a Bank reconciliation statement after necessary amendment in cash book as on
31.03.2013. (2+2)
Section B : Preparation of Accounts
Question 4.
(i) State the factors affecting the measurement of depreciation.
(ii) Ram Ltd. which depreciates its machinery at 10% p.a. on Diminishing Balance Method, had on 1st January,
1012 `9,72,000 on the debit side of Machinery Account.
During the year 2012 machinery purchased on 1st January, 2010 for `80,000 was sold for `45,000 on 1st July, 2012
and a new machinery at a cost of `1,50,000 was purchased and installed on the same date, installation changes
being `8,000.
The company wanted to change the method of depreciation from Diminishing Balance method to Straight Line
Method with effect from 1st January, 2009. Difference of depreciation up to 31st December, 2012 to be adjusted.
The rate of depreciation remains the same as before. Show Machinery Account. (1.5 + 3.5)
Postal Test Papers_P5_Intermediate_Syllabus 2012
Directorate of Studies, The Institute of Cost Accountants of India (Statutory Body under an Act of Parliament) Page 2
Question 5.
Mr. Gavaskar is the proprietor of a large business. The following Trial Balance was prepared from his books as on
30th June, 2012:
Particulars Amount
(`)
Particulars Amount
(`)
Land & Buildings
Cash at Bank
Motor Car
Furniture
Sundry Debtors
Cash in hand
Stock (1.7.11)
Return Inward
Printing & Stationery
Drawings
Bills Receivable
Travelling Expenses
Discount Allowed
Miscellaneous Expenses
Postage
Joint Venture Suspense A/c
Investments (Market value `28,000)
Interest on Bank Loan
Salaries (including advance for `4,000)
Entertainment Expenses
Purchases
Carriage Inwards
Advertisements
80,000
50,000
40,000
20,000
1,20,000
10,000
1,10,000
10,000
4,000
16,000
10,000
12,000
4,000
38,000
2,000
2,000
30,000
8,000
54,000
4,000
6,50,000
8,000
18,000
12% Bank Loan (U.B.I)
(No movement during the year)
Capital Accounts
Bills Payable
Sundry Creditors
Returns Outward
Discount Received
Sales
1,00,000
1,50,000
10,000
1,30,000
8,000
2,000
9,00,000
13,00,000 13,00,000
Additional Information:
(i) On 2nd January, 2012, Mr. Gavaskar entered into a Joint Venture with Mr. Shastri with an agreement to share
the profits and losses equally. Shastri supplied goods totaling `60,000 which wrongly passed through the
Purchase Day Book. The goods were sold for cash at profit of 25% on sales and stood credited to Sales
Account. Shastri had earlier incurred an account of `4,000 on account of Freight ad Insurance. Joint
Venture Suspense Account represents expenses incurred by Gavaskar on Joint Venture.
(ii) Bills Receivable for `8,000 endorsed on 21st March, 2012 in favour of creditors were subsequently
dishonoured but no entry for the dishonoured has been passed.
(iii) Three cheques of `3,000 `4,000 and `6,000 issued to parties on 29th June, 2012, were