Gauhati University Question Papers
Financial Accounting - II (May-June’ 2014)
Full Marks: 80
Time Allowed: 3 hours
Answer either in
English or Assamese
The figures in the
margin indicate full marks for the questions
1.
Answer the following questions: 1x10=10
a) Select
the accounting standard applicable to valuation of inventories from the
following options:
1) AS
– 1
2) AS
– 2
3) AS
– 6
4) AS
– 9
b) In
case flow statement donation is classified as:
1)
Financing activity.
2)
Investing activity.
3)
Operating activity.
4)
Philanthropic activity.
c) In
‘branch accounting’, goods sent to branch account is transferred to the credit
of:
1) Profit
and loss account.
2) Purchase
account.
3) Sales
account.
4) Inventory
account.
d) Which
of the following profit is considered for valuation of goodwill?
1) Gross
profit.
2) Net
profit.
3) Total
profit.
4) Operating
profit.
e) AS
– 21 Relates to:
1)
Revenue recognition.
2)
Consolidated financial statement.
3)
Accounting for amalgamation.
4)
Accounting for fixed assets.
f) Branch
stock account is always prepared at:
1)
Invoice price.
2)
Retail price.
3)
Wholesale price.
4)
Cost price.
g) Normal
loss is not shown in the branch account under:
1)
Debtors system.
2)
Stock and debtor system.
3)
Final account system.
4)
Hybrid system.
h) Indian
Partnership Act was enacted in the year:
1) 1922
2) 1932
3) 1942
4) 1952
i)
Balance in Realisation account in a partnership
firm is transferred to the capital accounts of the partners in which of the
following basis?
1) Sacrificing
ratio.
2) Gaining
ratio.
3) Capital
ratio.
4) Profit
sharing ratio.
j)
A partnership firm can be dissolved under which
of the following ‘circumstances?
1) Quarrel
among the partners.
2) Insanity
of one of the partners.
3) Order
from the municipality.
4) Existence
of a dormant partner.
2.
Answer the following in brief: 2x5=10
a)
Comment on the following statements:
1) Dissolution
of partnership firm and dissolution of partnership is synonymous. 2
2) Goodwill
of a firm represents the excess of real net worth of assets over their book
value. 2
3) The
average profit method takes into account the abnormal profit or loss arising
during the course of business. 2
b) State
the basic accounting assumptions under AS-I 2
c) What
is the treatment of bad debt under debtor system of branch accounting? 2
3.
Answer any four of the following: 5x4=20
a) Discuss
the salient features of Accounting Standard AS-9.
b) State
the objectives of branch accounting.
c) A
firm’s normal return is 15% of its net assets. The actual profit earned by it
is Rs. 75,000. Its value of net assets is Rs. 3,60,000.
What is the value of goodwill under capitalisation of average profit
method?
d) X
and Y are partners in a firm, sharing profits and losses in the ratio of 3 : 2
respectively. They decided to dissolve the firm. Following is the balance sheet
on the date of dissolution.
Balance Sheet
|
Liabilities
|
Amount
|
Assets
|
Amount
|
|
Creditors
Capital accounts:
X
25,000
Y 5,000
|
20,000
30,000
|
Cash at bank
Debtors
15,500
Less: Provision 3,500
Inventory
|
10,000
12,000
28,000
|
|
|
1,38,000
|
|
1,38,000
|
The
assets realised are as follows:
1) Debtors
Rs. 10,000;
2) Inventory
Rs. 18,000;
3) Goodwill
Rs. 5,500;
4) Realisation
expenses Rs. 1,000.
5) Y
brings in necessary cash to meet his deficit.
Give
journal entries in the books of the firm.
e) Discuss
the procedure of preparing a foreign branch account in the books of head
office.
f) Give
an account of International Accounting Standards Board.
4.
Answer the following questions: 10x4=40
a) Elaborate
the process of issuing IFRS.
b) The
balance sheet of Karna, Arjun and Bhim on 31st March 2013 who are in
partnership sharing profits and losses in the ratio of 3 : 1 : 1 is as follows:
Balance Sheet
|
Liabilities
|
Amount
|
Assets
|
Amount
|
|
Creditors
Bills Payable
Contingency Reserve
Mortgage on Building
Capital accounts:
Karna
Arjun
Bhim
|
7,000
3,500
8,000
11,000
22,000
20,000
18,000
|
Cash at bank
Motor car
Debtors
Machinery
Furniture
Inventory
|
4,500
25,000
13,000
21,000
17,000
9,000
|
|
|
89,500
|
|
89,500
|
On 1st
April, 2013 the firm is dissolved. The assets realised are as under:
1) Debtors
Rs. 11,000;
2) Furniture
Rs. 18,000;
3) Inventory
Rs. 8,500;
4) Motor
car Rs. 22,000.
Machinery
was taken over by Karna and Arjun at book value. Realisation expenses Rs. 400.
Close
the books of the firm by preparing necessary ledger accounts.
Or
a) Discuss
the manner of piecemeal distribution of proceeds when a partnership firm goes
into dissolution.
b) Discuss
the procedure of settlement of accounts when one or more partners are
insolvent. 5+5=10
c) Shan
Ltd. invoices goods to its Mumbai branch at cost. Prepare necessary ledger
accounts in the books of the head office under Stock & Debtors system from
the following information:
|
|
Rs.
|
|
Opening balance:
Stock
Debtors
Cash
Goods sent to
branches
Goods returned by
branch
Total sales (of
which Rs. 30,000 was cash sales)
Bad debts
Return from
customers
Cash remitted to
branch
Other expenses of
the branch
Cash remitted to
branch
Closing balance:
Stock
Debtors
|
10,000
14,000
400
30,000
3,000
53,500
900
1,000
46,000
6,000
4,500
8,000
15,000
|
***
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