1.

(b) 68,000
2. (d) Both (A) and (R) are correct and (R) is the correct explanation of (A).
3. (c) (i, (i), (ü), (iv) Or (a) Purchase Consideration
4. (d) X:Y = 5:3
Z's share = I/3 x 3/8 = 1/8
X's share = 5/8
Y's share = 2/3 >x 3/8 = 2/8
New ratio of X, Y and Z = 5:2:1
Or
(c) equal
5. (b) 1,950
6. (c) 1350
Or
(a) Authorised Capital
7. (a) Writing off capital losses
8. (b) Z's Capital A/c Dr. 20,000
To X's Capital A/c 20,000

(d) ? 50,000
9. (d) 25,000 10. (c) 10,000 +? 8,000 + 7,500 = 25,500
11. (c) X 22,750; Y ? 5,250 12. (c) 1,59,95,300
13. (b) Unsecured Debentures 14. (c) Loss 28,000
15. (b) Loss to the existing partners
Or
(d) ? 2,50,000
16. (b) 12,840
17. Profit and Loss Appropriation Alc
Dr. for the year ending 3)" March, 2023 Cr

Particulars Amount ) Particulars Amount )

To Interest on Capital A/c: By Profit and Loss Ale 2,59,000
A's Capital Alc 42,000 (Net Profit)
B's Capital A/c 35,000
C's Capital A/c 28,000 1,05,000
To Salary Alc:
B's Capital Alc 40,000
C's Capital A/c 24,000 64,000
To Profit transferred to:
A's Capital A/c 40,000
Less: Deficiency of B (10,000)
Less: Deficiency of C (2,000) 28,000
B's Capital A/c 20,000
Add: Deficiency borne by A 10,000 30,000
C's Capital Alc 30,000
Add: Deficiency borne by A 2,000 32,000
2,59,000 2,59,000
 Working notes:
B
Minimum guarantee R 30,000 760,000
Less: Amount actually received 7 20,000 7 58,000
Deficiency to be borne by A 10,000 2,000

18. In the books of Karizma, Yasmin and Zeenat

Journal
Date Particulars LE Dr. () Cr. ()
2023 Bank A/c Dr. 50,000
1" April To Zeenat's Current Alc 50,000
(For cash brought by Zeenat as her capital)
Zeenat's Current Ac Dr 10,000
To Karizma's Capital Alc 6,000
To Yasmin's Capital Alc 4,000
(For Karizma and Yasmin capitals credited with their share of goodwill
in sacrificing ratio of 3:2)
Profit and Loss A/c Dr. 85,000
To Karizma's Capital A/c 51,000
To Yasmin's Capital A/c 34,000
(For profit and loss transferred in old ratio)
Karizma's Capital AVe Dr 9,000
Yasmin's Capital A/c Dr. 6,000
To Advertisement Suspense A/c 15,000
(For advertisement suspense written off)
Working Notes:
Based on Zeenat's share, the total capital of the firm ought to be (? 50,000 x 5) ? 2,50,000

Less: Net worth of a new firm (adjusted capitals of the old partners + capital of
incoming partner i.e. 48,000 + 32,000 + 85,000 - 15,000 + 50,000) 2,00,000
Hidden GoodwilI RS0,000
Or
Dr. Partners' Capital A/cs Cr

Particulars
Xavier Yame Zombi
Particulars
Xavier Yame Zombi
() () () ) (3)
To Drawings A/c 60,000 60,000 60,000 By Balance b/d 4.40,00O 2,20,000
To Interest on Drawings By Bank Alc 1,20,000
Alc 3,900 2,700 3,600 By Premium for Goodwill
To Balance c/d 5,58,500 2,48,500 93,000 Alc 40,000 20,000
(Balancing figure) By Interest on Capital A/c 44,0X0X0 22,000 12,000
By Profit & Loss
Appropriation A/e 98,400 49,200 24,600
6,22,400 3,11,200 1,56,600 6,22,400 3,11,200 1,56,6O0
Interest on drawings:
Xavier: R 60,000 x 12/100 x 6.5/12 =3,900, Yame: 60,000 >x 12/100 x 4.5/12 =2,700,
Zombi: 60,000 x 12/100 >x 6/12 = R 3,600
Profit and Loss Appropriation= 2,40,000- Interest on Capital (? 78,000) + Interest on Capital (? 10,200)
=71,72,200 divided among Xavier, Yame and Zombi in 4:2: 1ratio.
19. the books of Prakash Ltd.
Journal
Date Particulars LE Dr. () Cr. ()
Sundry Assets A/c Dr 7,00,000
To Sundry Liabilities Alc 2,00,000
To Savita Ltd. 4,59,500
To Capital Reserve Alc 40,500
(For assets and liabilities of Savita Ltd. taken over)
Savita Ltd. Dr 4,59,500
To Bank Alc 8,500
To Equity Share Capital A/c 4,10,000
To Securities Premium Reserve Alc 41,000
(For purchase consideration paid through a bank draft and balance by
issue of 41,000 cquity sharcs of ? 10 cach at l0% premium)

In the books of X Ltd.

Journal
Date Particulars LE. Dr. (() Cr. ()
Bank A/c Dr 30,00,000
To Debentures Application and Allotment A/c 30,00,000
(For application and allotment money received for 20,000 debentures
a 150 per share)
Debentures Application and Allotment A/c Dr. 30,00,000
To 11% Debentures Alc 7,50,000
To Securities Premium Alc 3,75,000
To Bank Alc 18,75,000
(For 5,000 applicants rejected and prorata allotment of 7,500 debentures
were done to 15,000 applicants)

20. Calculation of goodwill:

GoodwilI Average profit x Number of years purchase
7 (90,000 + 1,30,000 + 86,000)
X 2

={1,02,000 x 2=2,04,000
(As loss by fire is not accounted, it is ignored)
1
Manik's share in goodwill of the firm=x
4
2,04,000 =7 51,000
Journal
Date Particulars L.E Dr. () Cr. ()
2023 Cash A/e Dr 51,000
April 1 To Premium for Goodwill Ae 51,000
(Being premium brought in cash by Manik)
Premium for Goodwill Ale Dr. 51,000
To Kabir's Capital A/c 38,250

To Farid's Capital A/c 12,750

(Being premium distributed among sacrificing partners in
sacrificing ratio)
21. (1) 33.000 (2) 33,000 (3) 33,000
(4) Loss on Issue of Debentures A/c (5) Securities Premium A/c
(6) 3,000 (7) 85,500 (8) 85,S00
(9) Debenture Application and Allotment A/c (10) 85,500
(11) LOSs Issue of Debentures Ale (12) 13,500 (13) 90,000
22 Journal

Date Particulars L.E Dr. () Cr. ()

(a) B's Capital Alc Dr 36,000
To Realisation A/c 36,000
(Being machinery taken over by B at 10% less than book value)
(b) Realisation Alc Dr 40.500
To Bank Alc 40,500
(Being creditors settled at 10% discount)
(c) A's Loan Ale Dr 4,000
To Bank A/e 3,800
To Realisation A/c 200
(Being A's loan settled at 3,800)
(d) Realisation A/c Dr 12.000
B's Capital A/c 12,000
(Being realisation expenses paid by B and borne by firm)

23. Books of Honda Limited

Journal
Date Particulars L.F Dr. () Cr. ()

Bank Ac Dr 2,00,000
To Equity Share Application A/c 2,00,000
(Application money on 10,000 shares @ 20 per share received)
Share Application Alc Dr 2,00,000
To Equity Share Capital A/e 2,00,000
(Application moncy transferred to share capital)
Share Allotment A/c Dr 4,00,000
To Equity Share Capital Alc 3,00,000
To Securities Premium Alc 1,00,000
(Money due on allotment of 10,000 shares @ 40 per share
including premium)
Bank Ae Dr 4,00,000
To Equity Share Allotment A/e 4,00,000
(Allotment Money received on 10,000 shares @? 40 per share)
Share First Call A/e Dr. 2,00,000
To Equity Share Capital A/c 2,00,000
(Money due on 10,000 shares @ 20 per share on first call)
Bank A/c Dr 1,94,000
Calls in Arrears A/c Dr 6,000
To Equity Share First Call Ale 2,00,000
(First call money received except for 300 shares)
 Share Second and Final Call A/c Dr 3,00,000
To Equity Share Capital A/c 3,00,000
(Money due on 10,000 shares @ 30 per share on second and
final call)
Bank Alc Dr 2,91,000
Calls in Arrears Alc Dr 9.000
To Equity Share Second and Final Call Ale 3,00,000
(Second and final call money received except for 300 shares)
Share Capital A/c Dr. 30,000
To Share Forfeited Alc 15,000
To Calls in Arrears Ale 15,000
(300 shares forfeited)
The minimum reissue price at which the forfeited shares can be reissued is ? 50 per share.
Or
Journal
Date Particulars L.E Dr. () Cr. ()
Bank A/c Dr 12,00,000
To Equity Share Application Alc 12,00,000
(Application money received on 4,00,000 shares)
Equity Share Application A/e Dr 12,00,000
To Equity Share Capital A/c 9,00,000
To Equity Share Allotment A/e 3,00,000
(Application money on 3,00,000 shares transferred to share capital
account and the excess amount adjusted to share allotment account)
Equity Share Allotment A/c Dr 15,00,000
To Equity Share Capital Ale 9,00,000
To Securities Premium Ae 6,00,000
(Allotment money due on 3,00,000 shares)
Bank A/c Dr 12,00,000
To Equity Share Allotment Alc 12,00,000
(Allotment amount received after adjusting excess money received
with application)
Equity Share First Call Ale Dr. 6,00,000
To Equity Share Capital Alc 6,00,000
(First call amount due on 3,00,000 shares)

Bank Ac Dr 5,98,400
Calls in Arrears A/c Dr 1,600
To Equity Share First Call Alc 6,00,000
(First call amount received on 2,99,200 shares)

Equity Share Second and Final Call A/c Dr 6,00,000

To Equity Share Capital Alc 6,00,000
(Second call amount due on 3,00,000 shares)
 Bank A/e Dr. 5,98,400
Calls in Arrears A/e Dr. 1,600
To Equity Share Second and Final Call A/c 6.00.000

(Second call amount received on 2,99,200 shares)

Equity Share Capital Ale Dr. 8,000

To Share Forfeited A/e 4,800
To Calls in Arrears Ale 3,200
(Forfeiture of 800 shares)
24. Journal

Date Particulars LLE Dr. ) Cr. ()

Profit and Loss Suspense AVc Dr. 500

To C's Capital Alc 500
(Being C's share of profit transferred to his account)

A's Capital Ale Dr. 4,375

B's Capital Ale Dr. 2,625
To C's Capital A/c 7,000
(Being C's share of goodwill adjusted through capital accounts)
Revaluation A/c Dr. 2,000
To A's Capital Alc 1,000
To B's Capital A/c 600

To C's Capital AJe 400

(Being profit on revaluation transferred to partners' capital account)

Contingency Reserve A/e Dr. 8,000

To A's Capital A/e 4.000
To B's Capital A/c 2,400
To C's Capital Alc 1,600
(Being contingency reserve distributed)
A's Capital A/c Dr. 2,500
B's Capital Alc Dr. 1,500
C's Capital Ale Dr. 1,000
To Goodwill Alc 5,000
(Being goodwill written off)
As Capital Ale Dr. 1,000
B's Capital Ale Dr. 600

C's Capital Ale Dr. 400

To Advertisement Suspense A/c 2,000
(Being advertisement suspense is written off)

C's Capital Ale Dr. 28,100

C'% Executor's A/c 28,100
(Being amount due to C transferred to his executor's account)
Working Note 1:
C's share in profit = 15.000 × 12 X = S00
10

Working Note 2:
13000 + 12000 + 16000 + 15000
Firm's Goodwill = x 2.5 = 35,000

C's Share of Goodwill 35,000 X 2 =7,000

10

Working Note 3:
Dr Revaluation A/c Cr.

Amount Amount
Particulars Particulars
()
To Machinery 5,000 By Patents 2,000
To Gain (Profit) transferred to: By Premises 5,000
As Capital A/e 1,000

B's Capital A/e 600

C's Capital Ale 400 2.000

7,000 7,000

Or

Dr Revaluation A/c Cr.

Amount Amount
Particulars Particulars
()
To Stock Ale 2,000 By Land and Building A/c 50,000
To Plant and Machinery A/c 16,000
To Debtors A/c 5,000

To Gain (Profit) transferred to Capital A/cs

Mridul 13,500
Vanshika 13,500 27,000

50,000 50,000

Dr Partners' Capital A/cs Cr.

Mridul Vanshika Gurleen Mridul Vanshika Gurleen

Particulars Particulars
() () () ()
To Balance c/d 1,78,500 2,18,500 2,00,000 By Balance b/d 1,20,000 1,60,000
(Bal. fig. By Revaluation A/e 13,500 13,500
By Premium for
Goodwill A/e 45,000 45,000
By Cash A/c 2,00,000
1,78,500 2,18,500 2,00,000 1,78,500 2,18,500 2,00,000
25. The new share of A, B and C = 6:3:3 or 2: 1:1.

Total capital of the new firm on the basis of C's capital=R 20,000x=80,000 divided into 2: 1:1. As capital
1
= 80,000 x 2 = 40,000; B's capital = 80,000 × =? 20,000; C's capital = 80,000 x =40,000 4

(i) Dr. Cash A/e 25,000, Cr. B's Capital A/c and C's Capital A/c by ?5,000 and 20,000 respectively.
(ü) Dr. A's Capital A/c 5,000 and Cr. Cash A/e 5,000.

26. (i) In the Books of Yogadatra Ltd.

Journal
Date Particulars L.E. Dr. () Cr. ()
2022 Debenture Application and Allotment Alc Dr 52,50,000
April Loss on Issue of Debentures Alc Dr. 5,00,000
To 6% Debentures A/c 50,00,000
To Securities Premium Alc 2,50,000
To Premium on Redemption of Debentures Alc 5,00,000
(Being allotment of debentures made)

(iü) Journal

Date Particulars LE Dr. () Cr. ()

2023 Sccurities Premium Alc Dr. 2,50,000
March 31 Statement of Profit and Loss A/e Dr. 2,50,000
To Loss on Issue of Debentures A/c 5,00,000
(Being loss on issuc of debentures account written off)

(üi) Dr. Loss on Issue of Debentures A/e Cr.

Amount Amount
Date Particulars Date Particulars
() )
2022 To Premium on 2023 By Securities Premium A/c 2.50,000
April Redemption of March 31 By Statement of Profit
Debentures A/c 5,00,000 and Loss Alc (Bal. fig.) 2.50,000
5.00.000 5,00,000

27. (b) Current Ratio

Or

(b) to know the short-term solvency

28. (d) Neither increase nor decrease
29. (c) Nil

(c) Statement I is correct and Statement II is incorrect.

30. (d) R 1,30,000
31. (i)) Finance costs, (ii) Cost of material consumed, (iü) Other expenses (iv) Other expenses (v) Employees
Benefit expenses (vi) Other Income
32. Debt Equity Ratio Debt/Equity
Debt Long Term Borrowings
73,00,000
Equity Current Assets + Non Current Assets Long Term Borrowings Current
Liabilities
90,000 + 3,60,000 3,00,000 50,000
R 1,00,000
Debt Equity Ratio Debt/Equity = 3,00,000/1,00,000 = 3: 1
Current Ratio Current Assets/Current Liabilities
90,000/50,000 = 1.8 : 1
33. Comparative Statement of Profit and Loss
as at 3lst March, 2022 and 2023
31st 31st Absolute Change Percentage
March, March, (Increase/ Change (Inerease/
Note 2022 2023 Decrease) Deerease)
Particulars () (%)
No.
(A) B) (C= B-A)
D=x1)
I. Revenue from Operations 30,00,000 37,50,000 7,50,000 25
II. Add: Other Income 60,000 75,000 15,000
III. Total Revenue 30,60,000 38,25,000 7,65,000 5

IV. Less: Expenses 20,60,000 25,75,000 5,15,000 25

V. Profit before Tax 10,00,000 12,50,000 2,50,000 25
VI. Less: Tax 4,00,000 5,00,000 1,00,000 25
VII. Profit after Tax 6,00,000 7,50,000 1,50,000 25

Or
Comparative Statement of Profit and Loss
for the year ended 3Ist March, 2023
31st 31st Absolute Change Percentage
March, March, (Increase/ Change (Increase/
Note 2022 2023 Decrease) Decrease)
Particulars 8) ({)
No () (%)
(A) (B) (C= B-A)

1. Revenue from Operations 30,00,000 35,00,000 5,00,000

(D-0) l6.67
II, Other Income 3,00,000 4,50,000 1,50,000 50.00
II. Total Revenue 33,00,000 39,50,000 6,50,000 19,69
IV. Expenses
(a) Cost of Material Consumed 20,00,000 23,00,000 3,00,000 15.00
(b) Other Expenses 1,00,000 1,20,000 20,000 20,00

Total Expenses 21,00,000 24,20,000 3,20,000 15.24

V. Profit before Tax 12,00,000 15,30,000 3,30,000 27.50
VI. Less: Tax (a 40% 4,80,000 6,12,000 132,000 27.50
VII. Profit after Tax 7.20.000 9,18,000 1,98,000 27.50
34. Cash Flow Statement of GPL Industries Ltd.
for the year ended 31" March, 2022
Sr Amount Amount
Particulars
No

A Cash lows from (or used in) Operating Activities:

Net Profit before tax and Extraordinary items 1,34,000
Adjustments for non-cash and non-operating items:
Add: Depreciation Fixed Tangible Assets 1,20,000
Interest on Long Term Borrowings 36,000
Operating profit before change in working capital 2,90,000
Add: Increase in current liabilities and Decrease in current assets
Trade Payables 10,000
Less: Decrease in current liabilities and Increase in current assets
Inventory (1,00,000)
Trade Receivables (80,000)
Cash generated from Operating Activities 1,20,000
Less: Income Tax Paid (60,000)
Net cash flows from Operating Activities 60,000 60,000
B Cash fHows from (or used in) from Investing Activities:
Purchase of Fixed Tangible Assets (4,20,00O)
Net cash used in Investing Activities (4,20,000) (4,20,000)
C. Cash flows from (or used in) from Financing Activities:
Proceeds from issue of Share Capital 4,00,000
Proceeds from issue of Long Term Borrowings 90,000
Interest paid on Long Term Borrowings (36,000)
Repayment of Bank Overdraft (15,000)
Net cash lows from Financing Activities 4,39,000 4,39,000
D Net Increase in Cash and Cash Equivalents (A + B+ C) 79,000
E Add: Cash and Cash cquivalents at the beginning of the year
Marketable Securities 3,65,000
Cash and Cash Equivalents 60,000 4,25,000
F Cash and Cash equivalents at the end of the year
Marketable Securities 84,000
Cash and Cash Equivalents 4,20,000 5,04,000

Working Notes:
Net profit for the current year (? 3,50,000 3,10,000) ? 40,000
Transfer to General Reserve ? 10,000
Provision for Tax ?84,000
Net Profit before tax and Extraordinary items 71,34,000
Dr. Fixed Tangible Assets A/c Cr.

Particulars Amount () Particulars Amount ()

To Balance b/d 9,00,000 By Deprcciation Ae 1,20,000
To Bank Ale (Balancing figure) 4,20,000 By Balance c/d 12,00,000
13.20.000 13,20,000