Accounts Test No. 5

Sunday, June 07, 2009 1. Answer the following Questions.

2.

(10 marks) i. ii. In which ratio will the profits and losses be shared by the partners in the absence of a partnership agreement? iii. Mention the parties of a bill of exchange. iv. What is do you mean by grace days? v. What is due date? vi. What is acceptance of the bill? vii. What is inland bill? viii.What is foreign bill? ix. What is noting charges? x. What is protesting? xi. What is bill of exchange?

3. On 10th March, 2009 Rajesh Bhoyar, Gandhinagar, Nagpur draws a 2 months bill for Rs. 3,000 on Samir Choudhary, Main Road, and Belapur. Samir Choudhary accepted the bill on 15th March 2009.

4. From the following particulars, value good will of 2yrs. Purchase of last 5 years. Year Turn Net ended over profit 31-125,15,0 5% 1990 00 6% 31-125,45,6 7% 1991 00 7.5% 31-125,35,8 1992 00 7% 31-121993

5,40,9 00

31-121994

5,60,8 00

5. Baloo owes Kaloo Rs.8000. Kaloo then draws a bill for Rs. 8000 on Baloo for a period of three months. Baloo accepts and return it to Kaloo. Kaloo discounted the bill with his bank at 12 % p.a. On due date, the bill was dishonoured noting charges amount to Rs. 30. Kaloo then draws a bill for the balance plus interest of Rs. 170. Before the due date of this bill Baloo pays the amount at a discount of Rs. 40 to retire the bill. Pass Journal Entries in the books of Kaloo.

6. Journalize the following transactions in the books of Maharaja. i.

Ayub informs Maharaja that Sadashiv’s acceptance for Rs. 2,000 endorsed to Ayub has been dishonoured, noting charges amounted to Rs. 150 ii. Pankaj renews his acceptance to Maharaja for Rs. 1200 by paying Rs. 400 in cash and accepting a fresh bill for the balance plus interest at 12% p.a. for 3 months.

Sunday, June 07, 2009 iii. Vaibhav’s acceptance to Maharaja for Rs. 6000 retired one month before the due date at a discount of 12%p.a. iv. Bank informs Maharaja as to the dishonour of Kasam’s acceptance for Rs. 2000 to Maharaja discounted with Bank noting charges Rs. 200.

7. Suresh and Ramesh entered into a joint venture to construct a building at a contract price of Rs. 7,00,000. They agreed to share profits and losses in the ratio of 2:1. Suresh deposited Rs. 5,00,000 and Ramesh Rs. 1,00,000 into joint bank. The transactions were as follows. 1. 2. Purchase of materials Rs. 3,50,000 3. Tools and equipment Rs. 1,00,000. 4. Wages Rs. 1,20,000 5. Architect fees Rs. 25,000 Besides these, Suresh supplied material worth Rs. 15,000 and Ramesh supplied material worth Rs. 13,500. Building was ready and contract price received. Prepare Joint venture A/c, Joint Bank A/c & Co – Venturer’s A/c.

8. Sudhir and Narendra Signed a contract jointly to construct an office building for Abhay Enterprises Ltd. The contract price was Rs. 2,50,000. They opened a Joint Bank Account and deposited Rs. 1, 20,000 and Rs. 60,000 respectively. They agreed to share the profits and losses in the ration of 3/5th and 2/5th respectively. The following transaction was made from the Joint Bank Account. Wages Rs. 70,000 Materials purchased Rs. 1,25,000 Apart from the above transactions, Sudhir supplied material of Rs. 12,000 and Narendra paid the architect’s fees Rs. 2500. On completion of the construction, Abhay Enterprises Ltd. paid full amount. There was unused stock of materials which was taken over by Narendra at Rs. 15000. Prepare Joint venture A/c, Joint Bank A/c & Co – Venturer’s A/c.

Sunday, June 07, 2009 9. 1. Answer the following Questions. (10 marks) i. ii. Who is endorsee? iii. What do you mean by goodwill? iv. What is endorsement of Bill? v. What is retirement of the bill? vi. What is Hundies? vii. Who is Drawer? viii.Who is Drawee? ix. Who is endorser? x. Who is payee? xi. What is the formula for average profit?

2.

Drawer Drawee Payee Amount of Bill Period Date of Bill Date of Acceptance

: : : : :

Priti Chavan, Chandika Road, Malvan. Snehlata Patil, Prashant Nagar, Ambajogai : Archana Ghime, Amaravati : Rs, 10,000/2 months. 1st January, 1996 5th January, 1996

3. A firm with an average capital employed of Rs. 1, 60,000 is expected to earn Rs, 40,000 per annum in future. Calculate goodwill at three times the super profit taking the normal rate of return as 15%.

4. Sagar owes Sindhu Rs. 8000 Sagar accepted a bill for 3 months by Sindhu for Rs. 8000. Sindhu discounted the bill with bank at Rs. 7800. On the due date, the bill was dishonoured. Noting charges amounted to Rs. 20. Sagar Paid half the amount of the bill and full amount of the noting charges including interest of Rs. 100. Pass journal entries in the books of Sindhu and show the account of Sagar. 5. Journalise the following transactions in the books of Rahul. a. Pradeep informed Rahul that, Vijay’s acceptance for Rs. 1,000 endorsed to Pradeep has been dishonoured. Noting charges amounted to Rs. 50. b. Nilesh renews his acceptance to Rahul for Rs. 600 by paying Rs. 200 in cash and accepting a fresh bill for balance plus interest at 12% p.a. for 3 months. c. Prashant’s acceptance to Rahul for Rs. 3,000 retired one month before due date at a discount of 12% p.a. d. Bank informs Rahul as to the dishonour of Aviraj’s acceptance for Rs. 1,000 to Rahul, discounted with the bank. Noting charges are Rs. 20. 6. Dimple and Simple entered into a joint venture. They agreed to share profits and losses in the proportion of their initial contributions to the joint venture. They opened a joint Bank A/c. and deposited Rs. 60,000 and Rs. 40,000 respectively as initial contributions. They made cash purchases of Rs. 70,000. They also paid Rs. 4,500 for insurance and freight and Rs. 1,750 for sundry expenses. At the end of the venture, the sales amounted to Rs. 1, 10,000/- There was unsold stock of goods worth Rs. 5000. Simple took over the unsold stock. Prepare Joint venture A/c, Joint Bank A/c & Co – Venturer’s A/c. 7. Manoj and Ambalal enter into a joint venture to prepare a building for the government, who agrees to pay Rs. 2,00,000. A Bank Account is opened in their joint

Sunday, June 07, 2009 names; Manoj contributing Rs. 25,000 and Ambalal Rs. 25,000 and it is agreed that they will share the profit and losses in the proportion of 2/5th and 3/5th respectively. Payment made out of the Joint Bank accounts were: Purchases of Equipments : Rs. 14,000 Hire Purchases of Equipments : Rs. 13,000 Wages : Rs. 85,000 Purchases of Materials : Rs. 18,000 Office expenses : Rs. 8,000 Manoj and Ambalal then paid Rs. 5, 000 and Rs. 3,000 respectively for other expenses. The building was completed the government paid the amount by cheque and the joint venture was closed. Ambalal taking up the equipments at Rs. 4,000 and Manoj taking up the unused material at Rs. 2, 000. Prepare Joint Venture A/c, Joint Bank A/c and CoVenture’s A/c.