2019 H.S. 2nd Year ACCOUNTANCY Question Paper

H.S. 2nd Year
Full Marks: 100
Pass Marks: 30
Time: Three hours

1. (a) Fill in the blanks with appropriate word/words: 1x4=4
(i) The liability of every shareholder of a company is ____ .
(ii) Outstanding Subscription is shown on the ______ side of the Balance Sheet.
(iii) If a partner takes over a liability of the firm, that partner’s capital account is ______ .
(iv) Current ratio is the relationship between ______ assets and current liabilities.

(b) Choose the correct alternative: 1x2=2
(i) Annual Report is issued by a company to its:
(1) Directors
(2) Auditors
(3) Shareholders
(4) Management.

(ii) Financial statements of a company include: 1
(1) Only Cash Flow Statement
(2) Only Profit and Loss Account
(3) Only Balance Sheet
(4) All of the above.

(c) State whether the following statements are “True” or “False”.
(i) The deceased partner is entitled to a share of profit for the period upto his death. 1
(ii) Profit or Loss on revaluation of assets and liabilities is distributed among old partners in sacrificing ratio.  1

2. Give two distinctions between a not-for-profit organization and a trading organization. 2

3. A and B are two partners sharing profits and losses in the ratio of 3:2. C is a admitted as a new partner for ³/₁₀ th share which he acquires  ²/₁₀ th from A and ⅒th from B. Calculate new profit sharing ratio. 2            


Give two conditions under which a partnership firm is dissolved.

4. Mention any two features of a debenture. 2

5. What is the meaning of Cash Flow from Investing Activities? 2         
6. What is meant by “super profit” in relation to valuation of goodwill? 2

7. Mention three objectives of preparing financial statements.  3

8. Calculate liquid ratio from the following information:  3

Stock                  = ₹50,000/-
Debtors              = ₹80,000/-
Bills Receivable = ₹10,000/-
Advance Tax      = ₹4,000/-
Cash                   = ₹30,000/-
Creditors            = ₹60,000/-
Bills Payable     = ₹40,000/-
Machinery         = ₹50,000/-
Bank Overdraft = ₹4,000/-
Debentures        = ₹70,000/-


What is Comparative Statement? Mention two objectives of preparing Comparative Statement. 1+2=3

9. What are contingent liabilities? Mention any two items. 1+2=3


Explain the average profit method of valuation of goodwill. 3

10. Calculate amount of medicines consumed to be shown in the Income and Expenditure A/c for the year ended 31-12-2018: 3
                                                01-01-2018      31-12-2018
                                                      (₹)                    (₹)
Stock of Medicines                     3,000                 500
Creditors for Medicines             2,000                 1,300
Amount paid for medicines during 2018 was ₹10,800/-


Mention any three distinctions between Receipts and Payments A/c and Income and Expenditure A/c. 3
11. Mention any three limitations of Financial Statements. 3


Write three objectives of preparing Realisation Account.   3

12. North East Club had a Cash balance of ₹20,000/- and Bank balance of ₹35,000/- respectively on 01-04-2017. From the following details prepare a Receipts and Payments Account for the year ended 31-03-2018:   5

Subscription Received:                  (₹)                (₹)
2016-17                                        30,000
2017-18                                     2,25,000
2018-19                                        10,000       2,65,000    

Donation for Building                                      60,000
Entrance Fee                                                     23,000
Life Membership Fee                                       20,000
Printing and Stationery                                     38,750
Lighting Expenses                                            26,250
Rent and Taxes Paid                                         17,000
Telephone Charges                                             2,600
Postage                                                               2,000
Salaries                                                             88,000
Insurance                                                          15,000
Interest Received                                              18,000
Locker Rent Received                                      42,000
Purchase of Furniture                                    2,00,000
Cash in hand as on 31-03-2018                        23,400


Explain in brief the treatment of the following items in preparation of Income and Expenditure Account:   5
(i) Subscription
(ii) Life Membership Fee
(iii) General Donation
(iv) Specific Donation
(v) Lagacy

13. What is Cash Flow Statement? Explain its three limitations.   2+3=5

From the following information calculate the cash from operating activities:
14. A business has a current ratio of 3:1 and a quick ratio of 1.2:1. If the Working Capital is ₹1,80,000, calculate current assets and stock. 5


What are profitability ratios? What is the significance of gross profit and operating profit ratio? 3+2=5

15. A, B and C were partners sharing profits in the ratio of 3:2:1 respectively. Balance Sheet of the firm as at 31st March, 2017 stood as follows: 5

“B” retired on the above date on the following terms:
(i) Building to be appreciated by ₹8,800.
(ii) Provision for doubtful debts be made @5% on debtors.
(iii) Goodwill of the firm be valued at ₹9,000.

Pass necessary Journal Entries.


What is share forfeiture? State the procedure of forfeiture of shares.    2+3=5

16. What is Partnership Deed? Mention its four principal clauses.  1+4=5


Following is the Balance Sheet of P, Q and R as on March 31, 2018.   5
Q died on June 30, 2018. Under the agreement the executors of the deceased partner were entitled to:

(a) Amount standing to the credit of Partner’s Capital A/c.
(b) Interest on Capital @5% p.a.
(c) Share of goodwill on the basis of twice the average of the past three years profit.
(d) Share of profit from the closing of the last financial year to the date of death on the basis of last year’s profit (2017-18).

(e) Profits for the last three years were:
Year                                     Profit (₹)
2015-16                               12,000/-
2016-17                                16,000/-
2017-18                                14,000/-
Prepare Q’s capital account on the date of his death.

17. Distinguish between Realisation Account and Revaluation Account.  5


A and B are partners sharing profits equally. Balance Sheet on September 2018 was as follows:  5

The firm is dissolved on the above date. Assets are realised at ₹49,600. Creditors allowed a discount of 2% and Dissolution Expenses came to ₹544.
Give Journal Entries to close the books of the firm.

18. Discuss the process for allotment of shares of a company in case of oversubscription. 5


Prepare a Comparative Income Statement from the following particulars: 5

19. Following is the Trial Balance of Rana and Raju as on 31st March, 2018: 8

Prepare the Profit & Loss Account and Profit & Loss Appropriation Account for the year ended 31st March, 2018 and a Balance Sheet of the Firm as on that date after taking into consideration the following additional information:
(i) Depreciate Machinery @10% p.a. and Furniture @20% p.a.
(ii) Partners will get interest on Capital @5% p.a.
(iii) Raju is entitled to a salary of ₹1,800 p.a.
(iv) The Profit sharing ratio between Rana and Raju was 3:2.

20. M. S. Ltd. issued 1,000 equity shares of ₹100 each payable as follows: 8
On Application - ₹25 per share
On Allotment - ₹25 per share
On First Call - ₹20 per share
On Final Call - ₹30 per share
All the shares were duly subscribed for, called-up and paid-up, except Mr. A holding 400 shares did not pay the final call money.

Show the entries in the Cash Book and Journal of the company for the above transactions.


Write short notes on:     3+3+2=8
(a) Redemption of Debentures
(b) Loss on Issue of Debentures
(c) Minimum Subscription.

21. S. K. Ltd. issued 1,000, 12% Debentures of ₹100 each. Give journal entries for Redemption of the debentures in the books of the company under the following conditions:  2+3+3=8
(i) Issued at Par and Redeemable at par after 5 years.
(ii) Issued at Par and Redeemable at a premium of 5% after 5 years.
(iii) Issued at a Premium of 5% Redeemable at Par after 5 years.


Write short notes on:     2+2+2+2=8
(i) Authorised Share Capital
(ii) Call-in-Arrear
(iii) Pro-Rata Allotment
(iv) Preference Share.

22. Vimal and Nirmal are partners in a firm sharing profits and losses in the ratio 3:2. Their Balance Sheet as on 31st December, 2018 was as under:  8

On that date Kailash was admitted as a new partner. He paid ₹40,000 as his capital and ₹20,000 for his share of goodwill. The new profit sharing ratio was agreed to be 2:1:1.
Pass Journal entries in the books of the firm and show the Balance Sheet of the new firm.


What is goodwill? Mention four factors affecting the goodwill of a firm. Mention three conditions when valuation of goodwill becomes necessary.     1+4+3=8