,Topics-
S.N. Particular Marks
(Minimum)
1 Fundamental of Partnership 5 to 6
i. Preparation of Profit and loss Appropriation Account
ii. Basic calculation of Interest on capital, Interest on drawings
iii. Guarantee of partners in share of profit.
2 Admission of a Partner 5 to 6
i. Preparation of Revaluation Account
ii. Preparation of Capital Account.
iii. Method of Calculation of Goodwill and Accounting treatment
iv. Sacrifice Ratio
v. Entries of Accumulated profits and losses and reserve.
3. Retirement of a Partner/ Death 4 to 5
i. Preparation of Revaluation Account
ii. Preparation of Capital Account.
iii. Accounting for goodwill
iv. Gaining ratio
v. Entries of Accumulated profits and losses and reserve.
vi. Deceased Partner’s capital account or executor account
4 Dissolution of a Partnership firm 4
i. Journal entries on the basis of Realisation account
5 Company Account – Issue of Shares 5 to 8
i. Basic entries of Issue of share capital (Simple Pro rata)
ii. Preparation of Balance sheet of a company in respect of share capital
effects.
iii. Forfeiture of shares only.
iv. Issue of share consideration other than cash.
6 Issue of Debentures 4
i. Issue of debentures with the redemption point of view
ii. Discount/loss on issue of debenture account and its effect
iii. Issue of debenture consideration other than cash
7 Financial Statement of a Company and analysis 3
i. Various main head and sub heads of company balance sheet with all
items of each sub heads.
ii. Theory of financial statement analysis.
8. Accounting Ratio 3
i. Formula of all ratio
ii. Important Ratio
a. Current ratio
b. Liquid ratio
c. Debt to equity ratio
d. Working capital turnover ratio
e. Inventory turnover ratio
f. Return on Investment
,9 Cash flow statement 3
i. Format of cashflow statement
ii. Basic items of cash flow statement like- Financing activities
Investing activities and preparation of Assets account with provision for
depreciation account.
SURE-SHOT QUESTIONS-ANSWERS
Q EXPECTED QUESTIONS & ANSWERS MM
SHORT QUESTIONS & ANSWERS
FOUNDATIONS OF PARTNERSHIP
1 List two items that may appear on the Credit side of a partner’s capital account if partner’s 1
capital is fixed.
(1) Fixed capital balance of partners
(2) Additional capital introduced by partners
2 Can a partner be exempted from sharing the losses in a firm? If yes, under what 1
circumstances?
Yes, if partnership deed provides so.
3 What is the Profit and Loss Appropriation Account? 1
Profit and Loss appropriation A/c is prepared to show the distribution of Profit among the
partners.
4 State the provisions of Partnership Act, 1932, in the absence of a Partnership Deed 1
regarding:
(i) Interest on advances other than Capital and
(ii) Interest on Partner’s Drawings.
(a) If any partner has given a loan or advance other than capital to the firm, he will be
allowed 6% p.a. interest on such advance.
(b) No interest is charged on partner’s drawings.
5 A and B decided that no interest on drawings is to be allowed to any partner. But after one 1
year C wants that interest on drawings is to be provided to every partner. State how C can
do this.
By entering into new partnership agreement.
6 Ishu, Vishu and Nishu are partners in a firm sharing profits and losses in the ratio of 2:3:5. 3
Their fixed capitals were Rs. 1,50,000, Rs. 3,00,000 and Rs. 6,00,000 respectively. After the
final accounts have been prepared it was discovered that interest on capital was credited to
them @ 12% instead of 10%. Pass the necessary adjustment entry.
Nishu’s Current A/c …. Dr. 1500
To Ishu’s Current A/c 1200
To Vishu’s Current A/c 300
7 Mohan, Rohan and Arohan are partners in a firm sharing profits and losses in the ratio of 3
2:3:5. Their fixed capitals were Rs. 3,00,000, Rs. 6,00,000 and Rs. 12,00,000 respectively.
For the year 2011-12, interest on capital was credited to them @ 12% instead of 10%. Pass
the necessary adjustment entry.
Arohan’s Current A/c …. Dr. 3,000
To Mohan’s Current A/c 2,400
To Rohan’s Current A/c 600
, 8 X, Y and Z are partners sharing profits and losses in the ratio of 3:2:1. After the final 3
accounts have been prepared, it was discovered that interest on drawings @ 5% p.a. had
not been taken into consideration. The drawings of the Partners were: X Rs.15,000; Y
Rs.12,600; Z Rs.12,000. Give the necessary adjusting journal entry.
Journal Entry
Date Particulars Amt(Dr.) Amt(Cr.)
Z’s Capital A/c …Dr. 135
To X’s Capital A/c 120
To Y’s Capital A/c 15
(Int. on drawings omitted, Now Adjusted)
Particulars X Y Z Total
Int. on Drawings to be charged 375 315 300 990
@ 5% p.a. for 6 months (Dr.)
adjustment of profits (Cr.) 445 330 165 990
Net adj. 120 Cr. 15 Dr. 135 Cr. -----
9 A, B and C are partners in firm. They had omitted interest on capital @ 10% p.a. for three 4
years ended 31st March 2012. Their fixed capitals on which interest was to be calculated
throughout were :
A Rs. 1,00,000
B Rs. 80,000
C Rs. 70,000
Give the necessary adjusting journal entry with working notes.
B’s Current A/c …. Dr. 1,000
C’s Current A/c …. Dr. 4,000
To A’s Current A/c 5,000
GOODWILL
10 State any two factors affecting value of goodwill of the firm. 1
(a) Nature of business
(b) Location
(c) Efficiency of management
(d) Market Situation
(e) Special Advantages
11 Mahesh and Ramesh are sharing profits in the ratio of 2: 3. Their capitals are Rs. 50,000 and 4
Rs. 40,000 respectively. They admit Naresh to a 1/3rd share in the profits of the firm on his
bringing in Rs. 10,000 for goodwill and Rs. 45,000 as capital. Naresh brings the necessary
amount of capital but only Rs. 6,000 towards goodwill. Give Journal entries to record the
above in the books of the firm.
Cash A/c …. Dr. 51,000
To Naresh’s Capital A/c 45,000
To Premium for Goodwill A/c 6,000
Premium A/c …. Dr. 6,000
Naresh’s Capital A/c …. Dr. 4,000
To Mahesh’s Capital A/c 4,000
To Ramesh’s Capital A/c 6,000
12 Aman and Suman are partners in a firm sharing profit and losses in the ratio of 3:2. They 4
S.N. Particular Marks
(Minimum)
1 Fundamental of Partnership 5 to 6
i. Preparation of Profit and loss Appropriation Account
ii. Basic calculation of Interest on capital, Interest on drawings
iii. Guarantee of partners in share of profit.
2 Admission of a Partner 5 to 6
i. Preparation of Revaluation Account
ii. Preparation of Capital Account.
iii. Method of Calculation of Goodwill and Accounting treatment
iv. Sacrifice Ratio
v. Entries of Accumulated profits and losses and reserve.
3. Retirement of a Partner/ Death 4 to 5
i. Preparation of Revaluation Account
ii. Preparation of Capital Account.
iii. Accounting for goodwill
iv. Gaining ratio
v. Entries of Accumulated profits and losses and reserve.
vi. Deceased Partner’s capital account or executor account
4 Dissolution of a Partnership firm 4
i. Journal entries on the basis of Realisation account
5 Company Account – Issue of Shares 5 to 8
i. Basic entries of Issue of share capital (Simple Pro rata)
ii. Preparation of Balance sheet of a company in respect of share capital
effects.
iii. Forfeiture of shares only.
iv. Issue of share consideration other than cash.
6 Issue of Debentures 4
i. Issue of debentures with the redemption point of view
ii. Discount/loss on issue of debenture account and its effect
iii. Issue of debenture consideration other than cash
7 Financial Statement of a Company and analysis 3
i. Various main head and sub heads of company balance sheet with all
items of each sub heads.
ii. Theory of financial statement analysis.
8. Accounting Ratio 3
i. Formula of all ratio
ii. Important Ratio
a. Current ratio
b. Liquid ratio
c. Debt to equity ratio
d. Working capital turnover ratio
e. Inventory turnover ratio
f. Return on Investment
,9 Cash flow statement 3
i. Format of cashflow statement
ii. Basic items of cash flow statement like- Financing activities
Investing activities and preparation of Assets account with provision for
depreciation account.
SURE-SHOT QUESTIONS-ANSWERS
Q EXPECTED QUESTIONS & ANSWERS MM
SHORT QUESTIONS & ANSWERS
FOUNDATIONS OF PARTNERSHIP
1 List two items that may appear on the Credit side of a partner’s capital account if partner’s 1
capital is fixed.
(1) Fixed capital balance of partners
(2) Additional capital introduced by partners
2 Can a partner be exempted from sharing the losses in a firm? If yes, under what 1
circumstances?
Yes, if partnership deed provides so.
3 What is the Profit and Loss Appropriation Account? 1
Profit and Loss appropriation A/c is prepared to show the distribution of Profit among the
partners.
4 State the provisions of Partnership Act, 1932, in the absence of a Partnership Deed 1
regarding:
(i) Interest on advances other than Capital and
(ii) Interest on Partner’s Drawings.
(a) If any partner has given a loan or advance other than capital to the firm, he will be
allowed 6% p.a. interest on such advance.
(b) No interest is charged on partner’s drawings.
5 A and B decided that no interest on drawings is to be allowed to any partner. But after one 1
year C wants that interest on drawings is to be provided to every partner. State how C can
do this.
By entering into new partnership agreement.
6 Ishu, Vishu and Nishu are partners in a firm sharing profits and losses in the ratio of 2:3:5. 3
Their fixed capitals were Rs. 1,50,000, Rs. 3,00,000 and Rs. 6,00,000 respectively. After the
final accounts have been prepared it was discovered that interest on capital was credited to
them @ 12% instead of 10%. Pass the necessary adjustment entry.
Nishu’s Current A/c …. Dr. 1500
To Ishu’s Current A/c 1200
To Vishu’s Current A/c 300
7 Mohan, Rohan and Arohan are partners in a firm sharing profits and losses in the ratio of 3
2:3:5. Their fixed capitals were Rs. 3,00,000, Rs. 6,00,000 and Rs. 12,00,000 respectively.
For the year 2011-12, interest on capital was credited to them @ 12% instead of 10%. Pass
the necessary adjustment entry.
Arohan’s Current A/c …. Dr. 3,000
To Mohan’s Current A/c 2,400
To Rohan’s Current A/c 600
, 8 X, Y and Z are partners sharing profits and losses in the ratio of 3:2:1. After the final 3
accounts have been prepared, it was discovered that interest on drawings @ 5% p.a. had
not been taken into consideration. The drawings of the Partners were: X Rs.15,000; Y
Rs.12,600; Z Rs.12,000. Give the necessary adjusting journal entry.
Journal Entry
Date Particulars Amt(Dr.) Amt(Cr.)
Z’s Capital A/c …Dr. 135
To X’s Capital A/c 120
To Y’s Capital A/c 15
(Int. on drawings omitted, Now Adjusted)
Particulars X Y Z Total
Int. on Drawings to be charged 375 315 300 990
@ 5% p.a. for 6 months (Dr.)
adjustment of profits (Cr.) 445 330 165 990
Net adj. 120 Cr. 15 Dr. 135 Cr. -----
9 A, B and C are partners in firm. They had omitted interest on capital @ 10% p.a. for three 4
years ended 31st March 2012. Their fixed capitals on which interest was to be calculated
throughout were :
A Rs. 1,00,000
B Rs. 80,000
C Rs. 70,000
Give the necessary adjusting journal entry with working notes.
B’s Current A/c …. Dr. 1,000
C’s Current A/c …. Dr. 4,000
To A’s Current A/c 5,000
GOODWILL
10 State any two factors affecting value of goodwill of the firm. 1
(a) Nature of business
(b) Location
(c) Efficiency of management
(d) Market Situation
(e) Special Advantages
11 Mahesh and Ramesh are sharing profits in the ratio of 2: 3. Their capitals are Rs. 50,000 and 4
Rs. 40,000 respectively. They admit Naresh to a 1/3rd share in the profits of the firm on his
bringing in Rs. 10,000 for goodwill and Rs. 45,000 as capital. Naresh brings the necessary
amount of capital but only Rs. 6,000 towards goodwill. Give Journal entries to record the
above in the books of the firm.
Cash A/c …. Dr. 51,000
To Naresh’s Capital A/c 45,000
To Premium for Goodwill A/c 6,000
Premium A/c …. Dr. 6,000
Naresh’s Capital A/c …. Dr. 4,000
To Mahesh’s Capital A/c 4,000
To Ramesh’s Capital A/c 6,000
12 Aman and Suman are partners in a firm sharing profit and losses in the ratio of 3:2. They 4
