List of practice Questions

Bharat and Ishu were partners in a firm sharing profits and losses in the ratio of 4 : 1. Rishab was admitted into partnership for \(\frac{1}{4}\) share in the profits of the firm. Goodwill of the firm was valued at 4,00,000. Rishab brought 2,00,000 as his capital and 60,000 out of his share of goodwill premium in cash. At the time of Rishab’s admission, goodwill was appearing in the books of the firm at 50,000.
Pass necessary journal entries for the above transactions in the books of the firm on Rishab’s admission.

The following information has been obtained from the books of Gama Ltd.:

Particulars	Amount (₹)
Inventory	2,50,000
Total Current Assets	3,40,000
Shareholder’s Funds	10,00,000
12% Debentures	20,00,000
Net Profit Before Tax	9,60,000
Cost of Revenue from Operations	6,00,000

Which of the following is not a limitation of Computerised Accounting System?

Identify the error which will be displayed on the screen when the value is not available to a function or formula:

The amount of share capital to be shown under the heading ‘Shareholder’s Funds’ will be:

Raja, Rajan and Rajani were partners in a firm sharing profits and losses in the ratio of 2 : 2 : 1. On 31st March, 2024, their Balance Sheet was as follows. On the above date, the firm was dissolved. Assets were realised and liabilities were paid off as follows:
(i) Land and Building was sold for ₹ 20,00,000.
(ii) Plant and Machinery realised ₹ 40,000 less than their book value and furniture was taken over by the creditors in full settlement of their account.
(iii) Debtors and Bills Receivable realised ₹ 90,000.
(iv) 60% of the stock was taken over by Raja at 90% of the book value and the remaining stock realised at ₹ 44,000.
(v) Outstanding wages were paid in full.
(vi) Mrs. Raja's loan was paid with interest of ₹ 10,000.
(vii) Realisation expenses were ₹ 8,000. Prepare Realisation Account.

Naval, Nyaya and Nritya were partners sharing profits in the ratio of 3:5:2. On 31st March, 2024, Nyaya retired. Revaluation of assets and goodwill adjustments were made. Prepare Revaluation Account and Partners’ Capital Accounts.

Uma and Umesh were partners in a firm sharing profits and losses in the ratio of 2:3. On 31st March, 2024, their Balance Sheet was given. Daya was admitted with 2:3:5 profit sharing ratio, bringing in capital and goodwill. Various revaluations and adjustments were also made. Journalise the transactions related to Daya’s admission.

Mayank Ltd. invited applications for issuing 70,000 equity shares of 100 each. The amount was payable as follows:
On Application – 20 per share
On Allotment – 40 per share
On First Call – 20 per share
On Second and Final Call – Balance
Applications for 1,00,000 shares were received and allotment was made to all the applicants on pro-rata basis. Jay, a shareholder who had applied for 1,000 shares, failed to pay the allotment money and his shares were forfeited immediately after the allotment. Meenakshi, the shareholder of 1,400 shares, failed to pay the first call money and her shares were forfeited just after the first call. The second and final call has not been made.
Pass necessary journal entries in the books of the company for the above transactions.

Hans, Sohan and Kishore were partners in a firm sharing profits and losses in the ratio of 3 : 2 : 1. The firm closes its books on 31st March every year. On 1^st August, 2024, Kishore died. The partnership deed provided that on the death of a partner, his executors will be entitled for:
(i) Balance in his capital account less drawings.
(ii) Interest on capital @ 12% p.a.
(iii) His share of goodwill.
(iv) His share in the profits of the firm till the date of his death calculated on the basis of average profit of the previous four years.
The following information was obtained from the books of the firm on the date of Kishore’s death:
(a) Capital on 1^st April, 2024 = 4,00,000, Drawings = 90,000
(b) Goodwill of the firm = 60,000
(c) Profits for last 4 years: 2,00,000, 2,20,000, 1,20,000, 1,80,000

Pass necessary journal entries for the issue of debentures in the books of NK Ltd. for the following transactions:
(i) Issued 500, 9% Debentures of 100 each at 10% discount, redeemable at a premium of 10% after 5 years.
(ii) Issued 400, 9% Debentures of 100 each at 5% discount, redeemable at par after 5 years.

Rani, Manav and Pushpa were partners in a firm sharing profits and losses in the ratio of 5 : 3 : 2. On 1st April, 2024, Rani decided to retire from the firm. On that day, the balance in her capital account after making necessary adjustments on account of reserves, revaluation of assets and reassessment of liabilities was 3,08,000. Manav and Pushpa agreed to pay her 3,80,000 in full settlement of her claim.
Calculate Rani’s share of goodwill and pass the necessary journal entry for the same.

On 1st April, 2024, Varsha Ltd. purchased from Rama Ltd., furniture at 12,00,000 and machinery at 20,00,000. It also took over its liabilities amounting to 3,00,000. The purchase consideration of 35,00,000 was paid by issuing a bank draft of 2,00,000 and the balance by issue of 11% Debentures of 100 each, at a premium of 10%.
Pass necessary journal entries for the above transactions in the books of Varsha Ltd.

Jim and Joy were partners in a firm sharing profits and losses equally. On 1st April, 2024, they admitted John as a new partner for \(\frac{1}{5}\) share in the profits of the firm. On the date of John’s admission, the Balance Sheet of Jim and Joy showed a debit balance of 45,000 in the Profit and Loss Account.
From the following, what will be the accounting treatment for this balance on John’s admission?

Vimal, Bose and Ghosh were partners in a firm sharing profits and losses equally. On 1st April, 2024, Bose retired from the firm and the new profit sharing ratio between Vimal and Ghosh was decided as 4 : 3. On Bose’s retirement, the goodwill of the firm was valued at 2,10,000. It was decided to treat goodwill without opening goodwill account. By what amount will the partners’ capital accounts be debited or credited for the treatment of goodwill on Bose’s retirement?

Hari, Chander, Prakash and Govind were partners in a firm sharing profits and losses in the ratio of 5 : 3 : 1 : 1. On 1st April, 2024, Hari retired and his share was acquired equally by Chander, Prakash and Govind. The new profit sharing ratio of Chander, Prakash and Govind will be:

On 1st April, 2023, Mudra Ltd. issued 9,000, 12% Debentures of 100 each at 10% premium, redeemable at a premium of 10% after 4 years. The interest due on debentures for the year ended 31^st March, 2024 was:

Saloni and Mohini were partners in a firm sharing profits and losses in the ratio of 3 : 2. On 31st March, 2024, Saloni’s capital was 1,50,000. During the year, she withdrew 10,000 and introduced additional capital of 32,000. For the year ended 31^st March, 2024, the firm earned a profit of 50,000. Saloni’s capital as on 1^st April, 2023, was:

Which of the following will result in dissolution of a partnership firm?

Which of the following will not result in compulsory dissolution of a partnership firm?

Usha and Mohak were partners in a firm. Usha withdrew a fixed amount at the end of every half-year for the year ended 31st March, 2024. Interest on drawings is charged at 9% p.a. Interest on Usha’s drawings will be charged for months.

Dev, Bhudev and Shamdev were partners in a firm sharing profits equally. On 31st March, 2024, their firm was dissolved. On this date the bank account showed a credit balance of 10,000 and there was a debit balance of 15,000 in the cash account. All payments were settled by cheque. Ravi, a creditor of 2,000 was not having any bank account, therefore he was paid in cash. Afterwards the cash account was closed by depositing the balance of cash into the bank. The journal entry for closing cash account will be:

Sandhya and Suman were partners in a firm sharing profits and losses in the ratio of 3 : 5. They decided to dissolve the firm on 31st March, 2024. On the date of dissolution, the Balance Sheet of the firm showed a balance of 80,000 in sundry debtors and a balance of 5,000 in provision for bad debts account. How much amount will be transferred to Realisation Account to close Sundry Debtors Account?

On 1st October, 2024, Nirmal Ltd. issued 6,000, 11% Debentures of 100 each at a premium of 10%, redeemable at a premium of 10%. ‘Loss on Issue of Debentures’ will be:

Raman Ltd. forfeited 500 shares of 10 each for non-payment of final call of 2 per share. Out of the forfeited shares, 300 shares were re-issued at 12 per share fully paid-up. The amount that was transferred to Capital Reserve Account was: