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Reg. No. : ............................ .

Name : ..................................

Second Semes ter B.Com. Degree Examin ation, May 2020

First Degree Progra mme Under CBCSS

Core Course : CO 1241/C X 1241/CC 1242/H M 1241/TT 1241

FINANCIAL ACCOU NTING

(Comm on for Comme rce/Com merce and Tax Proced ure and
Practic e/Comm erce and Tourism and Travel Manage ment/C ommer ce and
Hotel Manag ement and Catering/Commerce with Compu ter Applications)
(2018 Admission Onwards)

Time : 3 Hours Max. Marks : 80

SECTIO N-A

Answer all question s in one or two sentences each. Each question carries 1 mark.

1. Define account ing

2. What is Ledger?

.,;r.- What is a debit note?

.,,...r.- What is trade discoun t?

5. What is an opening entry?

6. What do you mean by fixed assets?

7. What is a balance sheet?

P .T.O.
 8. What are bonus shares?

9. What is hire Purchase?

10. What is address commission?

(10 x 1 = 10 Marks)
SECTION-B

Answer any eight questions in not exceeding one paragraph each. Each question
carries 2 marks.

7 Distinguish between Journal and Ledger.

JY. Name any two objectives of preparing the Trial Balance.

13. What do you understand by wasting assets? Give an example .

.}VWhat do you mean by dimin~i!:lg_balance method of providing depreciation?

15. Give a brief account of returnable packages.

1VJ6urnalise the following transactions in the books of Sri. P.N. Muthayya of

/ · Coimbatore
2019 March 1 Commenced business with Rs. 2,00,000
2019 March 4 Purchased goods for cash for Rs. 50,000 at 5% trade discount.
2019 March 9 Paid carriage Rs. 500
2019 March 11 Purchased machinery for Rs. 75,000

/ On January 1, 2020 the position of Mrs. Bindu Das was as follows:

Stock on hand, Rs. 10,000; Owing to Creditors, Rs. 8,000; Owing from Debtors,
Rs. 20,000; Building at cost, Rs. 80,000; Bank Overdraft, Rs.32 ,000; Loan to
Mr. Das, Rs. 20,000; Investments (Govt. Bonds), Rs. 15,000; Cash in hand,
Rs. 4 ,000.

What was the amount of Bindu Das' capital on this date? Construct journal entry
to open her books.

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/° Journalise the following transactions of a trader:
6000 .
(a) Janu ary 1, 2020 Sold good s to Hash mi on credi t Rs.
could pay only 50% of the
(b) Janu ary 11 , 2020, Hash mi beca me insol vent and
amount.
the books for the following?
1VW hat adjus tmen ts are requi red to be made in
ance comp any accepts
/ Good s in stock worth Rs.1, 100 are destr oyed by fire. Insur
the claim of Rs. 800.

y Pass nece ssary journ al entrie s for the following adjus tmen
ts:
Mach inery standing in the
(a) Depr eciat ion at 5% is to be charg ed on Plan t and
books at Rs. 50,00 0.
(b) Insurance unex pired Rs. 2,000 .
pany from the following
21. Show the perso nal acco unt of Mr.K utty and Com
transactions:

1-1-2 019 Opening balance (Credit).

ed
10-1- 2019 Purchased from them good s for Rs. 1,000 and was allow
trade disco unt 5%.
15-12019 Retu rned to them goods worth Rs. 40.
23-1 -201 9 Acce pted a bill draw n by them for Rs. 200.
31-1 -201 9 Paid cash in full settlement and was allow ed Rs. 20 cash
disco unt.

indem nity perio d of 6 mont hs;

22. A trade r inten ds to take a loss of profit polic y with
the follow ing details,
howe ver, he could not decid e the policy amou nt. From
sugg est the polic y amou nt:
Rs.

Turn over in last financial year 4,50, 000

Stan ding charg es in last finan cial year 90,00 0

the same trend expe cted
Net profi t earn ed in last year was 10% of turno ver and
in subs eque nt year.
Incre ase in turno ver expe cted 25% .
addit ional expe nditu re of
To achie ve addit ional sales , trade r has to incur
Rs. 31,25 0.
(8 x 2 = 16 Marks)
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3
 8 LCT ICJN C

Answ er any six question,, , in not excr:,;ding 120

word 1, . Each qu,_,r.,tv:in rAJffl '.:r"'
4 marks.

y Wha t are the difforencc11 botw ocn a trial balr.tnco and

a balanGl: Lhec t?

~ Defin e depreciation. Why is it necessary to provide depr

ecia tion?

,)fir:' Distingui sh between Hire Purchase and Instalmen

t Payment.

~o~ the following figures, you are required to prepare:

(a) Provision for Doubtful Acco unt: and

(b) Bad Debts Account

January 1, 2019 Provision for Bad Debts Rs.2 500

Dece mbe r 31, 2019 Bad Debts Rs. 1870
Debtors Rs. 20 ,000

27. On 1st January, 2017 A Ltd. acquired a mach

ine of whic h the cash price was
Rs. 25,800 . The purchase of machine was financed
by X Fina nce Corp orati on to
whom Rs. 4,00 0 was payable by A Ltd. on 1t r Janu
ary, 2017 and insta llme nts of
11
Rs. 8,000 on 31 December, 2017, 2018 and 2019
resp ectiv ely. The rate of
interest was 5% p.a. On 1a' January, 2019, the mac
hine was sold for Rs. 17,2 00
and the debt of X Finance Corporation was discharge
d on the date .

Show the account of X Finance Corporation in A Ltd's

ledg er.

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7 From the following details prepare the Profit and Loss Account of Messrs John
st
and Sons for the year ending 31 March 2019.
Rs.
Salaries 86,000
Discount allowed 4,200
Discount received 5,000
Bad debts 17,000
Printing and stationery 1,400
Depreciatio n 15,000
Insurance 11,500
Carriage outward 3,100
Interest received 6,700
Rent paid 24,000

Gross profit transferred from Trading Account - Rs . 1,97,500 .

st
29. On 31 January, 2019 X purchased for cash from Y four 6% Rs. 100 Debentures
st
of Mehta Ltd at Rs. 110.50% cum-interest; interest being payable on 1 June and
st
1 December each year.

How will you record the transactions in the books of X if each party had to pay
bank c·ommission of 25 paisa percent on face value?

30. From the following particulars prepare Containers Stock Account for the year
2019:
Opening stock@ Rs. 4 each: Nos. Nos.
On hand 10,000 Containers sold as scrap (for 1,000
Rs. 700)
With cu·stomers (alJ returnable) 25,000 Containers destroyed 500
Purchases during the year@ Rs. 30,000 Containers with customers at 20,000
5 each end
Containers sent out during the 50,000 Cost of repairs to cases Rs. 200
year
Containers returned by customers 45,000

Containers are valued in the books at cost and are charged out to customers at
Rs . 8 each, and credited at Rs. 6 each, if returned within the stipulated time .

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 31 . A seller sells goods on hire purchase adding 60% to cost. From the following
particulars prepare hire purchase trading account and ascertain profit or loss
made by him:
Rs.

2019 January, 1 Stock with customers at selling price 2 1,600

2019 December Goods sold on hire purchase during 87. 120

31 the year at selling price
Cash received during the year 57.720

Stock with customer at selling price 48,000

Installments due but not received 5,000

(6 x 4 = 24 Marks)
SECTION - D

Answer any two questions in not exceeding four pages each Each question carries
15 marks.

32. Discuss in detail the different types of accounting errors.

/ From the following figures extracted from the books of Mr. Y.V.Bhushan you are
required to prepare a Trading and Profit and Loss account for the year ended
st
31 December. 2019 and a Balance Sheet as on that date after making
necessary adjustments
Debit balances Rs. Credit Balances Rs.
Purchases 1,20,500 Capital 52,000
st
Stock on 1 January 21 ,500 Sales 1,86,000
Salaries 14,000 Sundry debtors 10,900
Rent and rates 3,000
Insurance 800
General expenses 3,100
Wages 25,000

- -
Machinery
Sundry debtors
31,000
20,000
Cash at bank 3,000
Drawings 7,000

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 Adjustments:
(1) Salaries for the month of December still unpaid Rs. 1,600.
(2) Insurance prepaid to the extent of Rs. 250.
(3) Depreciate machinery by 10%.
(4) Closing stock was valued at Rs. 26,000.
th
~ u e to a fire in the godown of a company. on'-30 September. 2019, the entire
stock was burnt except some stock costing Rs. 70.000. The books were,
however, saved .

From the information available, it was found that

(a) The company's average gross profit was 25% on sales.
st
(b) The stock on 31 March , 201 9 valued at 10% above cost was Rs. 2,20,000.
st
(c) The purchase and sales from 1 April, 2019 upto the date of fire were
Rs. 3,00,000 and 6,80,000 respectively.
(d) The wages for the period aniounted to Rs. 1,44,000.
(e) The company got the stock insured for Rs. 1,20 ,000.
(f) The policy had an average clause.

You are required to prepare a statement showing the amount of stock lost by fire
and the amount of claim to be lodged with the insurance company.
st
35. On 1st January, 2016, machinery was purchased by X for Rs. 50,000. On 1 July,
t
2017, additions were made to the extent of Rs. 10,000. On 1s April , 2018, further
th
additions were made to the extent of Rs. 6,400. On 30 June. 2019, machinery,
st
the original value of which was Rs. 8,000 on 1 January, 2016, was sold for
Rs. 6,000. Depreciation is charged at 10% p.a. on original cost.

Show Machinery Account for the years from 2016 to 2019 in the books of X. X
st
closes his books on 31 December.

(2 x 15 = 30 Marks)

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