Accountancy

Money taken out 'for personal use' is a drawing, not a withdrawal of capital. Drawings attract interest on drawings; they do not reduce the capital on which interest on capital is allowed.
Interest on Tara's capital = ₹4,00,000 × 8% × 12/12 = ₹32,000.
Common mistake: reducing the capital to ₹3,00,000 from October and getting ₹28,000.

Mutual agency means each partner can bind the firm (acts as agent) and is bound by the acts of the others (acts as principal). This is exactly why a partner is both principal and agent, so R explains A.

Amount payable per share on application = ₹10 + ₹1 premium = ₹11.
Application money is received on all shares applied for: 1,00,000 × ₹11 = ₹11,00,000.
(Pro-rata allotment only affects how the excess is adjusted/refunded, not the amount received.)

Loss on issue = Discount on issue + Premium on redemption.
Discount = 30,000 × ₹10 = ₹3,00,000.
Premium on redemption = ₹4,50,000 − ₹3,00,000 = ₹1,50,000 (i.e. ₹5 per debenture, 5%).

Sacrifice/gain = Old share − New share.
Kartik: 4/9 − 2/9 = 2/9 (sacrifice); Inder: 3/9 − 3/9 = 0; Lalit: 2/9 − 4/9 = −2/9 (gain).
Amount = ₹1,80,000 × 2/9 = ₹40,000. The gaining partner (Lalit) compensates the sacrificing partner (Kartik).

An accumulated loss (debit balance of P&L) belongs to the old ratio, so it is written off to partners' capitals in the old ratio 5 : 4 : 1.
Nidhi = 4,00,000 × 5/10 = ₹2,00,000; Pranav = ₹1,60,000; Ishu = ₹40,000.
Entry: Partners' Capital A/cs Dr. → To Profit & Loss A/c ₹4,00,000.

Total capital implied by Tushar's contribution = ₹4,00,000 × 4/1 = ₹16,00,000.
Actual capital = 5,00,000 + 3,00,000 + 4,00,000 = ₹12,00,000.
Goodwill = ₹16,00,000 − ₹12,00,000 = ₹4,00,000.

Advance money is a liability of the company towards the shareholder until the call is made, so Bank is debited and Calls in Advance A/c is credited. It is adjusted when the call falls due.

Registered debentures are recorded in the Register of Debenture Holders and are transferable only through a proper transfer deed. Bearer debentures pass by mere delivery and have no such register.

Paid-up capital = Called-up capital − Calls in arrears. It is the amount really received against the calls made.

Old shares: 3/6, 2/6, 1/6. New shares: 2/6 each.
Misha: 3/6 − 2/6 = 1/6 sacrifice; Sarita: 2/6 − 2/6 = 0; Isha: 1/6 − 2/6 = −1/6, i.e. gain 1/6.

When nothing is agreed, the continuing partners keep their old mutual ratio, so they acquire the outgoing share in that ratio. Sia : Aryan = 4 : 1.

Drawings on 1 Apr, 1 Jun, 1 Aug, 1 Oct, 1 Dec, 1 Feb = 6 × ₹20,000 = ₹1,20,000.
Months outstanding: 12, 10, 8, 6, 4, 2 → average = 42/6 = 7 months.
Interest = 1,20,000 × 6% × 7/12 = ₹4,200.

Amit's share = 1/10.
Vishesh gains 1/10 × 2/5 = 2/50 → new = 25/50 + 2/50 = 27/50.
Manik gains 1/10 × 3/5 = 3/50 → new = 20/50 + 3/50 = 23/50.
New ratio = 27 : 23.

Varsha's share = 2/5 = 6/15.
To Aryan: 1/3 × 6/15 = 2/15; to Nimit: 4/15.
Aryan = 6/15 + 2/15 = 8/15; Nimit = 3/15 + 4/15 = 7/15 → 8 : 7.

With fixed capitals, the Capital Account carries only capital introduced/withdrawn permanently. All regular items (drawings, interest, salary, profit share) go to the Current Account; drawings reduce the partner's claim, so they are debited.

Amount forfeited = ₹8 per share (received before forfeiture).
Maximum discount on reissue = forfeited amount = ₹8 per share.
Minimum reissue price = ₹10 − ₹8 = ₹2 per share → 4,000 × ₹2 = ₹8,000.

Interest is always on the face value: 20,000 × ₹100 × 13% = ₹2,60,000. The issue discount and redemption premium do not change it.

Realised = Gross debtors − bad debts = ₹60,000 − ₹8,000 = ₹52,000. The provision is just a book figure transferred to Realisation A/c; it is not deducted from cash collected.

Total capital of the new firm = 2,00,000 + 1,80,000 + 1,20,000 = ₹5,00,000 (Veena's ₹1,80,000 is replaced by fresh cash).
New ratio = 3 : 1 (old ratio of continuing partners).
Ashmit = 5,00,000 × 3/4 = ₹3,75,000; Rohan = ₹1,25,000.

'Overvalued by 20%' means book value = true value + 20% of true value.
1.2 × True value = ₹6,00,000 → True value = ₹5,00,000.
Common mistake: deducting 20% of ₹6,00,000 to get ₹4,80,000.

Step 1: Profit as % of last year's sales = 1,00,000 / 4,00,000 = 25%.
Step 2: Estimated profit up to death = 25% × ₹1,50,000 = ₹37,500.
Step 3: Zaina's share = 37,500 × 2/5 = ₹15,000.
Journal (1 July 2024):
Profit and Loss Suspense A/c ... Dr. ₹15,000
To Zaina's Capital A/c ₹15,000
(Zaina's share of profit up to the date of death credited)

Total profit of 3 years = 1,15,000 + 1,24,000 + 2,11,000 = ₹4,50,000.
Already credited (2:2:1): Amish 1,80,000; Nitish 1,80,000; Misha 90,000.
Should be (1:1:1): 1,50,000 each.
Net effect: Amish −30,000 (debit); Nitish −30,000 (debit); Misha +60,000 (credit).
Entry:
Amish's Capital A/c ... Dr. ₹30,000
Nitish's Capital A/c ... Dr. ₹30,000
To Misha's Capital A/c ₹60,000
(Past profits adjusted for change in ratio)

Normal division (2:3:5): Vidhi 40,000; Manas 60,000; Ansh 1,00,000.
Deficiency to Ansh = 1,20,000 − 1,00,000 = ₹20,000, borne equally → ₹10,000 each.
Entries (31 March 2024):
1) P&L Appropriation A/c ... Dr. ₹2,00,000
To Vidhi's Capital ₹40,000
To Manas's Capital ₹60,000
To Ansh's Capital ₹1,00,000
2) Vidhi's Capital A/c ... Dr. ₹10,000
Manas's Capital A/c ... Dr. ₹10,000
To Ansh's Capital A/c ₹20,000
(Alternatively one entry crediting Vidhi ₹30,000, Manas ₹50,000, Ansh ₹1,20,000.)

Net assets = 4,00,000 − 70,000 = ₹3,30,000; consideration ₹3,60,000 → Goodwill = ₹30,000.
No. of debentures = 3,60,000 / 120 = 3,000.
1) Sundry Assets A/c ... Dr. ₹4,00,000
Goodwill A/c ... Dr. ₹30,000
To Sundry Liabilities A/c ₹70,000
To Marvel Ltd. ₹3,60,000
2) Marvel Ltd. ... Dr. ₹3,60,000
To 11% Debentures A/c ₹3,00,000
To Securities Premium A/c ₹60,000

Net assets = 6,00,000 − 1,00,000 = ₹5,00,000 > consideration ₹3,60,000 → Capital Reserve ₹1,40,000.
No. of debentures = 3,60,000 / 90 = 4,000.
1) Sundry Assets A/c ... Dr. ₹6,00,000
To Sundry Liabilities A/c ₹1,00,000
To Rabi Ltd. ₹3,60,000
To Capital Reserve A/c ₹1,40,000
2) Rabi Ltd. ... Dr. ₹3,60,000
Discount on Issue of Debentures A/c ... Dr. ₹40,000
To 10% Debentures A/c ₹4,00,000

Normal profit = 12% × 15,00,000 = ₹1,80,000.
Average profit = (2,40,000 + 2,80,000 + 3,20,000)/3 = ₹2,80,000.
Less partners' salaries (₹50,000) → adjusted average profit = ₹2,30,000.
Super profit = 2,30,000 − 1,80,000 = ₹50,000.
Goodwill = 50,000 × 2 = ₹1,00,000.
(Partners' salary is a reasonable reward for their work, so it is deducted before comparing with normal profit.)

(i) Kiero Ltd.
Bank A/c ... Dr. ₹80,00,000
To Debenture Application & Allotment A/c ₹80,00,000
Debenture Application & Allotment A/c ... Dr. ₹80,00,000
Loss on Issue of Debentures A/c ... Dr. ₹8,00,000
To 9% Debentures A/c ₹80,00,000
To Premium on Redemption of Debentures A/c ₹8,00,000
(ii) Naro Ltd. (issue price ₹105)
Bank A/c ... Dr. ₹52,50,000
To Debenture Application & Allotment A/c ₹52,50,000
Debenture Application & Allotment A/c ... Dr. ₹52,50,000
Loss on Issue of Debentures A/c ... Dr. ₹5,00,000
To 10% Debentures A/c ₹50,00,000
To Securities Premium A/c ₹2,50,000
To Premium on Redemption of Debentures A/c ₹5,00,000
Note: premium on redemption is a future liability, so it is provided at issue and the same amount is a loss on issue.

Workings:
General Reserve share = 50,000 × 1/5 = ₹10,000.
Interest on capital = 90,000 × 8% × 4/12 = ₹2,400 (1 April to 31 July).
Goodwill = 40,000 × 2 = ₹80,000; Vedika's share = 80,000 × 1/5 = ₹16,000, borne by Raja and Bharat in gaining ratio 1 : 1 → ₹8,000 each.
\[\begin{array}{|l|r|l|r|}\hline \text{Dr. Particulars} & \text{₹} & \text{Cr. Particulars} & \text{₹}\\\hline \text{To Drawings} & 12{,}000 & \text{By Balance b/d} & 90{,}000\\ \text{To Vedika's Executors} & 1{,}09{,}400 & \text{By General Reserve} & 10{,}000\\ & & \text{By Interest on Capital} & 2{,}400\\ & & \text{By P\&L Suspense} & 3{,}000\\ & & \text{By Raja's Capital} & 8{,}000\\ & & \text{By Bharat's Capital} & 8{,}000\\\hline & 1{,}21{,}400 & & 1{,}21{,}400\\\hline\end{array}\]

(i) The unpaid call was cancelled on forfeiture, so no calls in arrears remain → Nil.
(ii) 82,000 − 2,000 forfeited = 80,000 shares.
(iii) Amount received on forfeited shares = 2,000 × ₹8 = ₹16,000.
(iv) Issued capital = shares offered to the public = 90,000 × ₹10 = ₹9,00,000.
(v) Forfeited shares account is added to subscribed (fully paid-up) capital.
(vi) Subscribed capital = 80,000 × 10 = ₹8,00,000 + forfeited shares ₹16,000 = ₹8,16,000.

(i) Realisation A/c ... Dr. ₹9,000
To Cash A/c ₹9,000
(Furniture given to creditors needs no entry; only the cash part is recorded.)
(ii) Ajit's Capital A/c ... Dr. ₹7,200 (40% of 20,000 = 8,000 less 10%)
Cash A/c ... Dr. ₹18,000
To Realisation A/c ₹25,200
(iii) Realisation A/c ... Dr. ₹16,000
To Vibha's Capital A/c ₹16,000
(Expenses borne by Vibha herself are covered by her remuneration – no entry.)
(iv) Ajit's Loan A/c ... Dr. ₹45,000
To Cash A/c ₹42,000
To Realisation A/c ₹3,000
(v) Vibha's Capital A/c ... Dr. ₹23,000
To Realisation A/c ₹23,000 (record at the price agreed, not expected value)
(vi) Vibha's Capital A/c ... Dr. ₹10,000
Ajit's Capital A/c ... Dr. ₹10,000
To Profit and Loss A/c ₹20,000 (equally, as no ratio is given)

1) Bank A/c ... Dr. ₹16,80,000 (2,40,000 × 7)
To Equity Share Application & Allotment A/c ₹16,80,000
2) Equity Share Application & Allotment A/c ... Dr. ₹16,80,000
To Equity Share Capital A/c ₹12,00,000 (2,00,000 × 6)
To Securities Premium A/c ₹2,00,000 (2,00,000 × 1)
To Bank A/c ₹2,80,000 (rejected 30,000 × 7 + excess 10,000 × 7)
3) Equity Share First & Final Call A/c ... Dr. ₹14,00,000 (₹7: capital 4, premium 3)
To Equity Share Capital A/c ₹8,00,000
To Securities Premium A/c ₹6,00,000
4) Bank A/c ... Dr. ₹13,72,000
Calls in Arrears A/c ... Dr. ₹28,000 (4,000 × 7)
To Equity Share First & Final Call A/c ₹14,00,000
5) Equity Share Capital A/c ... Dr. ₹40,000
Securities Premium A/c ... Dr. ₹12,000 (unpaid premium ₹3 × 4,000)
To Share Forfeiture A/c ₹24,000 (₹6 per share received towards capital)
To Calls in Arrears A/c ₹28,000
6) Bank A/c ... Dr. ₹16,000
Share Forfeiture A/c ... Dr. ₹24,000
To Equity Share Capital A/c ₹40,000
Discount on reissue (₹6 per share) uses up the whole forfeiture, so nothing goes to Capital Reserve.

(i) Called up per share = ₹80 capital + ₹10 premium (first call). Received = ₹20 (application). Unpaid = 30 + 40 = ₹70.
Share Capital A/c ... Dr. ₹2,40,000 (3,000 × 80)
Securities Premium A/c ... Dr. ₹30,000 (3,000 × 10)
To Share Forfeiture A/c ₹60,000
To Share Allotment A/c ₹90,000
To Share First Call A/c ₹1,20,000
Reissue (₹90 received for ₹80 paid up, so ₹10 per share is premium):
Bank A/c ... Dr. ₹1,80,000
To Share Capital A/c ₹1,60,000
To Securities Premium A/c ₹20,000
Share Forfeiture A/c ... Dr. ₹40,000 (2,000 × 20)
To Capital Reserve A/c ₹40,000
(ii) Share Capital A/c ... Dr. ₹90,000 (10,000 × 9 called)
To Share Forfeiture A/c ₹50,000 (₹5 received)
To Share First Call A/c ₹40,000
Bank A/c ... Dr. ₹36,000
Share Forfeiture A/c ... Dr. ₹4,000
To Share Capital A/c ₹40,000
Forfeiture on 4,000 shares = ₹20,000; used ₹4,000 → transfer ₹16,000:
Share Forfeiture A/c ... Dr. ₹16,000
To Capital Reserve A/c ₹16,000

Revaluation A/c: Dr. To Provision for doubtful debts ₹3,500 (4,500 − 1,000); Cr. By Machinery ₹60,000, By Creditors ₹3,500. Profit = ₹60,000 → Aryan 45,000, Adya 15,000.
Goodwill premium = 2,00,000 × 1/5 = ₹40,000, shared in sacrificing ratio = old ratio 3 : 1 → 30,000 and 10,000.
WCR ₹20,000 → 15,000 : 5,000. P&L debit ₹20,000 → 15,000 : 5,000.
\[\begin{array}{|l|r|r|r|}\hline \text{Capital A/cs} & \text{Aryan} & \text{Adya} & \text{Dev}\\\hline \text{Balance b/d} & 3{,}20{,}000 & 2{,}40{,}000 & -\\ \text{Add Premium for goodwill} & 30{,}000 & 10{,}000 & -\\ \text{Add WCR} & 15{,}000 & 5{,}000 & -\\ \text{Add Revaluation profit} & 45{,}000 & 15{,}000 & -\\ \text{Less P\&L (debit)} & (15{,}000) & (5{,}000) & -\\ \text{Cash brought in} & - & - & 1{,}65{,}000\\\hline \text{Balance c/d} & 3{,}95{,}000 & 2{,}65{,}000 & 1{,}65{,}000\\\hline\end{array}\]
Dev's capital: old partners' adjusted capitals 6,60,000 = 4/5 of total → total 8,25,000 → Dev = 1/5 = ₹1,65,000.

Patents undervalued by 20%: true value × 80% = 80,000 → true value 1,00,000 → increase ₹20,000.
1) Patents A/c Dr. ₹20,000 To Revaluation A/c ₹20,000
2) Revaluation A/c Dr. ₹10,000 To Stock A/c ₹10,000
3) Revaluation A/c Dr. ₹10,000 To Ashish ₹4,000, Vinit ₹4,000, Reema ₹2,000 (profit 2:2:1)
4) General Reserve A/c Dr. ₹50,000 To Ashish ₹20,000, Vinit ₹20,000, Reema ₹10,000
5) Gaining ratio: Ashish 3/5 − 2/5 = 1/5; Reema 2/5 − 1/5 = 1/5 → 1 : 1. Vinit's goodwill share = 60,000 × 2/5 = ₹24,000.
Ashish's Capital Dr. ₹12,000, Reema's Capital Dr. ₹12,000 To Vinit's Capital ₹24,000
6) Vinit's balance = 2,00,000 + 4,000 + 20,000 + 24,000 = ₹2,48,000.
Vinit's Capital A/c Dr. ₹2,48,000 To Cash ₹20,000, To Vinit's Loan A/c ₹2,28,000

Comparative statements place figures of two or more periods side by side with absolute and percentage changes, which reveals the trend and direction of change. Common size statements show the structure of one period instead.

Turnover ratios (inventory, receivables, payables, working capital, fixed assets turnover) relate revenue/cost to the resources used and so show efficiency of operations.

The inability to produce reports that were not programmed is a limitation of computerised accounting, not an advantage. Timely reports, economy and efficient records are advantages.

The CBSE marking scheme keys option (D): codes replace full account names with symbols/numbers, which conceals (encrypts) the data and protects it, besides making processing faster. Remember the board's key for this question is (D).

Debt = long-term borrowings; Equity = shareholders' funds.
Issue of debentures raises debt with no change in equity → ratio rises.
Credit purchase and payment to creditors affect current liabilities only (no effect); sale of furniture at profit raises equity (ratio falls).

Format tab → Shape Styles group → the 'More' arrow opens the full gallery of shape styles.

(i) and (iii) relate to the main revenue-producing activity → operating.
(ii) Dividend received (non-financial company) → investing.
(iv) Repayment of loans → financing.

Interest and dividend received by a non-financial company are investing inflows, not financing. All the other statements are correct.

Internal checks and controls cover safeguarding of assets, accuracy of records and efficient use of resources together; the other options cover only one aspect ('only').

Loans (Liability) group contains bank OD, secured and unsecured loans. Sundry creditors fall under Current Liabilities.

Statement I is the AS-3 definition of investing activities. Statement II is a standard example of investing outflow (capitalised R&D is part of intangible assets). Both are true.

Journal vouchers record non-cash adjustments (depreciation, outstanding expenses, transfers). Payment/receipt vouchers involve cash/bank; contra is for cash–bank transfers.

(i) Computer software: Major head Non-Current Assets; sub-head Property, Plant & Equipment and Intangible Assets → Intangible Assets.
(ii) Outstanding salary: Major head Current Liabilities; sub-head Other Current Liabilities.
(iii) Work in progress: Major head Current Assets; sub-head Inventories.
(½ mark each for head and sub-head.)

Data: a data item/element is the smallest named unit in an information system; accounting software processes such items into reports like journals and ledgers.
Information: data processed to suit the needs of a decision maker; what is data at one level becomes information at the next.
Transaction: a record of an inflow or outflow of resources, made up of four data elements – account name, account code, date and amount.

Each item as % of revenue from operations.
\[\begin{array}{|l|r|r|r|r|}\hline \text{Particulars} & \text{2022-23 (₹)} & \text{2023-24 (₹)} & \text{2022-23 (\%)} & \text{2023-24 (\%)}\\\hline \text{Revenue from operations} & 20{,}00{,}000 & 40{,}00{,}000 & 100 & 100\\ \text{Purchase of stock-in-trade} & 4{,}00{,}000 & 8{,}00{,}000 & 20 & 20\\ \text{Other expenses} & 2{,}00{,}000 & 4{,}00{,}000 & 10 & 10\\ \text{Total expenses} & 6{,}00{,}000 & 12{,}00{,}000 & 30 & 30\\ \text{Profit before tax} & 14{,}00{,}000 & 28{,}00{,}000 & 70 & 70\\ \text{Less Tax 50\%} & 7{,}00{,}000 & 14{,}00{,}000 & 35 & 35\\ \text{Profit after tax} & 7{,}00{,}000 & 14{,}00{,}000 & 35 & 35\\\hline\end{array}\]

Any six (½ mark each):
1. Performs all basic accounting functions.
2. Manages stores/inventory.
3. Does job costing.
4. Manages payroll.
5. Produces MIS reports for day-to-day decisions.
6. Prepares financial statements and tax returns (GST/TDS etc.).
7. Maintains budgets and scenarios.
8. Calculates interest on pending amounts.
9. Manages data across locations and synchronises it.

Total purchases = Credit + ¼ Credit = 5/4 Credit → Credit purchases = 15,00,000 × 4/5 = ₹12,00,000.
Trade payables turnover = Net credit purchases / Average payables → Average = 12,00,000/4 = ₹3,00,000.
Average = (O + 2O)/2 = 1.5 O = 3,00,000 → Opening = ₹2,00,000; Closing = ₹4,00,000.
Common mistake: taking cash purchases as 25% of total purchases.

ROI = PBIT / Capital employed × 100.
Interest on debentures = 10% × 8,00,000 = ₹80,000.
PBIT = 3,00,000 + 1,00,000 + 80,000 = ₹4,80,000.
Capital employed = Shareholders' funds + Debentures = 16,00,000 + 8,00,000 = ₹24,00,000 (check: 21,00,000 + 5,00,000 − 2,00,000 = 24,00,000).
ROI = 4,80,000 / 24,00,000 × 100 = 20%.

1. Labels (text): descriptive entries like names or months; Excel left-aligns them.
2. Values (numbers): raw numbers; whole numbers and decimals are right-aligned (trailing zeros of decimals are dropped, e.g. 3.70 shows as 3.7).
3. Formulas: instructions that make Excel calculate (start with =).
4. Dates: stored as values and displayed in a country-specific format.

Data Validation: a feature that defines restrictions on the type/range of data allowed in a cell, so that entries stay accurate and consistent. (1 mark)
Error Alert tab enables:
(a) showing an alert after invalid data is entered;
(b) typing a title and message for the user;
(c) choosing a style – Stop (blocks the invalid entry), Warning (warns but allows it) or Information (only informs and allows it).

(a) Book value of machine sold = 50,000 − 20,000 = 30,000; sale price = 30,000 + 10% = ₹33,000 (profit ₹3,000).
Machinery A/c (cost): Opening 3,00,000 − 50,000 sold + Purchases = 3,80,000 → Purchases = ₹1,30,000.
(Accumulated depreciation: 45,000 − 20,000 + charge = 62,000 → depreciation for year ₹37,000; non-cash, not in investing.)
Investing: Purchase of machinery (1,30,000) + Sale of machinery 33,000 = Net cash used (97,000).
(b) Issue of equity shares = 4,00,000 + premium 40,000 = ₹4,40,000 inflow.
Redemption of debentures = (1,00,000).
Interest paid = (40,000).
Net cash from financing activities = ₹3,00,000.

Options: change shape style, shape outline and text format.
On the Format tab, Shape Styles group:
• Click 'More' to see all shape styles; click a predefined style to apply it.
• Shape Fill → choose a theme or standard colour.
• No Fill → removes colour from the selected element.
• More Fill Colours → define a custom colour (appears under Recent Colours).
• Picture → fill the shape with an image via the Insert Picture dialog.
• Gradient → pick a gradient variation for the fill colour.
• Texture → fill with a chosen texture.