Financial Accounting TYBCOM Sem 6 Question Paper
Financial Accounting TYBCOM Sem 6 Question Paper

Financial Accounting TYBCOM Sem 6 Question Paper

April 2019

[Time: 3 Hours] [ Marks:100]

Please check whether you have got the right question paper.
N.B:
1) All questions are compulsory.
2) Figures to the right indicate Fall marks allotted to question.
3) Working notes should form the part of your answer.

Q.1 A) State whether the following statements are True or False: (Any 10) (10 Marks)

  1. In LLP, books of accounts are maintained on accrual basis only.
  2. Statutory Reserves are incorporated in the books of purchasing company under Capital Reserves.
  3. In Partial underwriting, only 2 persons can underwrite the issue.
  4. Company cannot become a member of LLP.
  5. Purchase consideration is the amount to be payable to Equity shareholders, Preference .shareholders and Debenture holders.
  6. Unmarked applications are known as direct applications.
  7. Unpaid calls are to be included under Assets in Statement of Affairs.
  8. In amalgamation, payment to preference shareholders for unpaid dividend is to be included in purchase consideration.
  9. The liquidator is not entitled to claim remuneration on cash balance unless otherwise given.
  10. Exchange rate is the proportion between two currencies.
  11. Designated partners are like directors of a company.
  12. Discount on issue of shares is an example of accumulated loss.

Q.1 B) Match the following: (Any 10) (10 Marks)

“A” “B”
1) Absorptiona) Excess of Net asset taken over
2) Unmarked Applications b) Stock
3) Non Monetary Item c) Net Asset Method
4) Capital Reserved) Without any seal or stamp of underwriter
5) Registration of LLPe) Submitted to Official Liquidator
6) Equity Share Capitalf) Appointed by Central Government
7). Deficiency / Surplus Alc ©g) List-H
8) Statement of Affairs h) AS-11
9) Currency-conversioni) One or more liquidation, no formation
10) Amalgamation Adjustment j) Under LLP Act, 2008 Reserve .
11) Appointment of Officialk) Reserve in the Balance Sheet of the Liquidator purchasing company
12) Purchase consideration l) Own funds
m) Transferor company

Q.2 A) Marvel Ltd imported goods from Larson Ltd of Germany worth US $ 2,00,000 on 30th November, 2017 when the exchange rate was ₹ 69 per US $. The payment was made as follows: (07 Marks)

DateAmountExchange Rate per US $
12 November, 20171,00,000 ₹ 68
17 December, 201750,000₹ 70
25 January, 201850,000₹ 67

Marvel Ltd closes its books on 31st March every year. On 31st March, 2018, the exchange rate was ₹ 68 per US $.
You are required to pass Journal Entries in the books of Marvel Ltd. for the year ended 31st March, 2018.

Q.2 B) MNC Ltd exported goods to ELC Ltd in NewYork worth $ 75,000 on 1st January, 2018 on which date the exchange rate of 1 US $ was ₹ 70. The amount was received from ELC Ltd in three equal installments on the following dates: (08 Marks)

DateExchange Rate per US $ (₹)
15″ January, 2018₹ 69
10″ February, 2018₹ 71
25″ April, 2018₹ 68

MNC Lid closes the books on 31st March every year. The rate of exchange on 31st March 2018 was ₹ 69 per US $
Pass Journal Entries in the books of MNC Ltd to record the above transactions.

OR

Q.2 B) Suresh Ltd exported goods to Happy Ltd from USA worth US $ 50,000 on 15th February 2017 when exchange rate was ₹ 65 per US $.
The payment was received in installments as under :(15 Marks)

DateAmount of Installment US $Exchange Rate per US $
10/01/1710,000 (Advance) ₹ 66
15/03/1720,000₹ 67
10/04/1715,000₹ 66
10/05/175,000 ₹ 64

Suresh Ltd closes its books every year on 31st March. On 31st March 2017, the exchange rate was ₹68 per US $.
You are required to pass Journal Entries in the books of Suresh Ltd. for the year ended 31% March, 2017 and 31% March, 2018. Also prepare Foreign Exchange Fluctuation account in the books of Suresh Ltd.

Q.3) Sunil Ltd agreed lo take over the business of Anil Ltd as on 31st March 2018. Following are the Balance Sheets of Anil Ltd and Sunil Ltd as on 31st March 2018. (15 Marks)

Liabilities Anil Ltd Sunil LtdAssets Anil Ltd Sunil Ltd
Equity shares of ₹10 each 9,00,00013,00,000Fixed Assets 5,95,000 8.50,000
Profit & Loss A/c32,0001,75,000Sundry Debtors 2,00,0003,40,000
Export Profit Reserve20,00030,000 Stock2,40,0004,90,000
8% Debentures1,50,0002,00,000Bank Balance1,57,0001,50,000
Sundry Creditors90,0001,25,000
TOTAL11,92,00018,30,000TOTAL11,92,00018,30,000

Following are the terms and conditions:

  1. Sunil Ltd issued 1,00,000 equity shares of ₹10 each at a premium of 10% for the equity shareholders of Anil Ltd and also paid them cash of ₹ 5 for every 3 shares held.
  2. All the assets and liabilities of Anil Ltd are taken over at book value except Fixed Assets revalued at ₹ 6,70,000 and Sundry Debtors subject to 5% provision for Bad Debts.
  3. Cost of absorption amounting to ₹ 5,000/- was paid by Anil Ltd.
  4. The Debentures of Anil Ltd to be converted into equivalent number of 8% debentures of Sunil Ltd.

You are required to:
1. Calculate purchase consideration.
2. Prepare Ledger Accounts to close the books of Accounts of Anil Ltd.
3. Prepare Balance Sheet of Sunil Ltd after absorption.

OR

Q.3 A) Balance Sheet of Sameer Ltd as on 31% March 2018 is as follows : (08 Marks)

Liabilities Assets
Equity Shares of Rs. 100 each4,00,000Machinery 4,90,000
Profit & Loss A/c70,000Debtors 70,000
General Reserve 60,000Stock 80,000
10% Debentures1,00,000Bank 20,000
Creditors 30,000
Total 6,60,000Total 6,60,000

Mala Ltd took over all the assets and liabilities at book value except machinery valued at 10% above book value and stock at ₹60,000.
Purchase Consideration is to be satisfied by issue of 5,000 equity shares of ₹ 100 each and balance is paid in cash.
Calculate Purchase Consideration

Q.3 B) Following is the extracted information of Adarsh Ltd as on 315 March 2018 : (07 Marks)
10,000 Equity shares of 100 each 10,00,000
5,000 12% Preference shares of ¥ 100 each 5,00,000
Total Share Capital ₹ 15,00,000

Sandip Ltd took over the business of Adarsh Ltd as on 3 1 March 2018 on following terms and conditions.
1. Preference shareholders of Adarsh Ltd have been issued 6,000 15% preference shares of T100 each at 8% premium.
2. Sandip Ltd issued 4 equity shares of ₹ 100 each at ₹ 110 for every 5 equity shares held by Adarsh Ltd and also paid cash of ₹10 per share for each share held.
3. Adarsh Ltd incurred cost of liquidation ₹10,000.
Calculate Purchase Consideration and write journal entry in the books of Sandip Ltd. for discharge of P.C.

Q.4 A) Max Ltd has authorize capital of 1,00,000 equity shares of ₹10 each. Company issued 60,00 0 shares at a premium of ₹2 each. The entire issue was underwritten by Vicky , Ricky and Micky in the ratio of 5:3:2 respectively. (15 Marks)
Application were received for 48,000 shares out of which marked application were as follows:
Vicky – 24,000 Shares
Ricky – 8,550 Shares
Micky – 12,450 Shares
Underwriters are entitled to get 5% commission on issue price.
You are required to:
a) Find out the net liability of underwriters.
b) Pass Journal Entries in the books of Max Ltd.

OR

Q.4 B) A, B, and C were partners sharing profits and losses as 3:2:2. The following is the Balance Sheet of A, B and C as on 31.03.2019.(15 Marks).

Liabilities Assets
Capitals :Land & Building1,44,000
A 1,45,500 Machinery 42,000
B 87,000Stock18,000
C 37.5002,70,000Bills Receivable36,000
Creditors 24,000Debtors54,000
Total 2,94,000Total 2,94,000

The partners decided to convert the business into a LLP on 31% March, 2019 on the following terms.
1) LLP which consists of A, B and C as partners contributes ₹1,50,000 each.
2) The company took over all assets except stock, which was taken by A for ₹15,000 and assumed all the liabilities. It also agreed to pay ₹45,000 for goodwill.
3) The purchase consideration was paid in cash.
Prepare:
1) Realisation A/c
2) Partners Capital A/c
3) Cash A/c
4) Journal Entries in the books of LLP
5) Statements of Assets and Liabilities

Q.5) R and K were equal partners in a firm. Their Balance Sheet as on 31st March, 2019 is as 15 follows :(15 Marks).

LiabilitiesAssets
Capital AccountsBuilding 1,28,000
R1,10,000Furniture 12,000
K 40,000Debtors 32,000
Less: RDD 2,000
30,000
Sundry Creditors50,000Stock 36,000
Loan on Mortgage20,000Cash14,000
Total 220,000 Total 220,000

On the above date, they converted their business into LLP on the following terms :
1.To take over Debtors at Rs. 28,000, stock at ₹44,000, furniture at ₹8,000, Buildings at ₹1,40,000 and Goodwill at ₹44,000.
2.To take over Sundry Creditors from whom a discount of ₹4,000 would be earned.
3.To take over Mortgage Loan along with unrecorded interest of 2,000.
4.Dissolution expenses were 4,000.
Calculate :
1) Statement of purchase consideration.
2) Open Realisation A/c, R and K’s capital A/c, and LLP’s A/c in the books of firm.

OR

Q.5 A) Kailash Ltd went into voluntary liquidation on 1st January 2018, when their Balance Sheet 08 was as follows: (15 Marks)

LiabilitiesAssets
Share CapitalPlant & Machinery7,00,000
50,000 Equity Shares of Rs. 10 each5,00,000Stock3,25,000
50,000 5% Preference Shares of Rs. 10 each5,00,000Debtors3,00,000
6% Debentures1,25,000Cash5,000
Creditors2,62,500Profit & Loss A/c57,500
Total 13,87,500Total 13,87,500

1) The liquidator realized the assets as follows:
Plant & Machinery – ₹5,00,000
Stock – ₹2,00,000
Debtors – ₹2,50,000
2) The expenses of liquidation amounted to ₹9,750 and the liquidator’s remuneration was agreed at 2% on amount of realization.
3) Preference Dividend was in arrears for one year and Debenture holder’s claim was paid on 30th June 2018.
Prepare Liquidator’s Final Statement of Account.

Q.5 B) Krishna Ltd issued 5,00,000 Equity Shares of ₹10 each at par. 1,40,000 Equity Shares were issued to the promoters and balance shares were offered to public which was underwritten by Simi, Kimi and Timi in the proportion of 2/9; 3/9; 4/9. Firm underwriting was as follows:(07 Marks)
Simi – 10,000 shares
Kimi – 12,000 shares
Timi – 14,000 shares
Total subscription received was 2,77,600 shares including marked application and excluding firm underwriting. Marked applications were
Simi – 60,000 shares
Kimi – 70,000 shares
Timi – 90,000 shares .
Compute the liability of underwriters assuming that the benefit of firm underwriting is given to underwriters.

Q.6 A) Discuss the procedure of calculation of Net Liability of the underwriters. (10 Marks)
Q.6 B) Distinguish between Pooling of Interest Method and Purchase Method of Amalgamation. (10 Marks)

OR

Q.6 Write short notes: (Any 4) (20 Marks)
1) Liquidator’s Final Statement of Account. .
2) Limited Liability Partnership (LLP).
3) Monetary & Non-monetary items.
4) Conditional & Firm Underwriting.
5) Net Payment Method of Purchase Consideration.
6) Absorption of company.

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