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LOYOLA COLLEGE (AUTONOMOUS), CHENNAI 600 034
B.Com.DEGREE EXAMINATION -COMMERCE
FIRST SEMESTER APRIL 2018
CO 1500- FINANCIAL ACCOUNTING
Date: 27-04-2018 Dept. No. Max. 100 Marks
Time: 01:00-04:00
SECTION A MARKS)
ANSWER ALL QUESTIONS
1. What do you understand by final accounts?
2. Define Depreciation.
3. Define single entry.
4. Write the meaning of conversion method.
5. What do you mean by branch account?
6. Write the meaning of departmental accounting.
7. What do you mean by installment system?
8. Define Hire purchase system.
9. Define social responsibility accounting.
10. What do you mean by Human Resource Accounting?
SECTION B MARKS)
ANSWER ANY FOUR QUESTIONS
11. Differentiate single entry from double entry system.
12. Discuss the need for departmental accounting.
Distinguish between departments and branches.
13. A machine purchased on 1st July 1983 at a cost of Rs. 14,000 and Rs. 1,000 was spent on its installation. The depreciation is written off at 10% on the original cost every year. The books are closed on 31st December each year. The machine was sold for Rs. 9,500 on 31st March 1986. Show the machinery account for all the years.
14. The proprietor of a large retail store wished to ascertain approximately the net profit of the X,Y and Z departments separately for the three months ended 31st March 1996. It is found impracticable actually to take stock on that date, but an adequate system of departmental accounting is in use, and the normal rates of gross profit for the three departments concerned are respectively 30% and 20% on turnover before charging the direct expenses. The indirect expenses are charged in proportion to departmental turnover.
The following are the figures for the departments:
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Particulars
X Rs.
Y Rs.
Z Rs.
Opening stock (1.1.96)
10,000
14,000
7,000
Purchases
12,000
13,500
9,700
Sales
20,000
18,000
16,000
Direct expenses
2,000
1,500
700
The total indirect expenses for the period (including those relating to other departments) were Rs.5,400 on the total turnover of Rs.1,08,000. Prepare a statement showing the approximate net profit, making a stock reserve of 10% for each department on the estimated value on 31.3.96.
15. On 1.1.86, X purchased machinery on hire purchase system. The payment is to be made Rs.4,000 down (on signing of the contract) and Rs. 4,000 annually for three years. The cash price of the machinery is Rs. 14, 900 and the rate of interest is 5%. Calculate the interest in each year's installments and prepare ledger in the books of hire vendor.
16. From the following particulars, prepare Bills receivable account and Total Debtor's Account for the year ended 31.12.1992:
Details
Rs.
Total Debtors on 1.1.1992
Bills Receivable on 1.1.1992
Sales (including cash sales Rs.20,000) made during the year
Cash received from debtors
Bills Receivable on 31.12.1992
Returns inwards
Discount allowed to debtors
Bad Debts written off
Bills receivable endorsed to creditors
Cash received on bills matured
36,000
10,000
300,000
200,000
15,000
15,000
10,000
3,000
10,000
15,000
17. Loyal Shoe Company opened a branch at Chennai on 1.1.89. From the following particulars, the Chennai Branch account for the years 1989 and 1990.
Particulars
1989 Rs.
1990 Rs.
Goods sent to Chennai Branch
15,000
45,000
Cash sent to Branch for:
Rent
1,800
1,800
Salaries
3,000
5,000
Other expenses
1,200
1,600
Cash received from the branch
24,000
60,000
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Stock on 31st December
2,300
5,800
Petty cash in hand on 31st December
40
30
SECTION C MARKS)
ANSWER ANY TWO QUESTIONS
18. Edward's books show the following balances. Prepare his trading and profit and loss account for the year ended 31st March 2018 and Balance Sheet as on that date.
Debit
Rs.
Credit
Rs.
Drawings
Bills Receivable
Land and Building
Sundry Debtors
Wages and Salaries
Return inwards
Purchases
Postage and Telegram
Stock on 1.1.2017
Printing and Stationary
Travelling expenses
Interest on loan paid
Petty cash
Bank Balance
Repairs
Commission
Furniture
Investment
5,000
4,500
37,770
62,000
40,970
2,780
2,56,590
5,620
89,680
880
12,000
300
70
8,800
3,620
470
500
19,000
Capital
Loan at p.a.
Sales
Interest on investment
Sundry creditors
Commission received
Return outwards
1,08,850
20,000
3,50,000
5,640
59,000
630
6,430
Total
5,50,550
Total
5,50,550
Adjustments:
1. Closing stock was Rs.1,28,960 on 31.12.2017
2. Commission received but not earned Rs.130
3. Travelling expenses were over drawn by the employees to the extent of Rs.2,000
4. Create reserve on sundry debtors and allow discount on debtors and creditors
5. Interest on loan due for 9 months
6. 1/4th of the wages and salaries should be charged to trading account.
19. A head office invoices goods to its branch at cost plus 50%. Branch remits all cash receipts to the head office and all the expenses are met by H.O. From the following particulars, prepare necessary account on the stock and debtors system to show the profit and loss at the branch:
Particulars
Rs.
Particulars
Rs.
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Stock on 1.1.17 (invoice price)
Debtors on 1.1.17
Goods invoiced to branch (invoice price)
Cash sales
Credit sales
Cash collected from debtors
27,900
20,400
1,53,000
75,000
93,000
91,200
Goods returned by debtors
Goods returned to H.O. by branch
Shortage of stock
Discount allowed
Expenses at the branch
Bad debts
3,600
4,500
1,350
600
16,200
600
20. On 1.1.2010 National Transport Company purchased from Metro Motors five trucks costing Rs.40,000 each on the hire purchase system. It was agreed that Rs.50,000 should be paid immediately and the balance in three installment of Rs.60,000 each at the end of each year.The Metro Motors charges interest at 10% p.a. The buyer depreciates the trucks at 20% p.a. on the diminishing balance method. The buyer paid cash down and two installments but failed to pay the last installments. Consequently the Metro Motors repossessed three trucks leaving two trucks with the buyer and adjusting the value of three trucks against the amount due. The trucks repossessed were valued on the basis of 30% p.a. on written down value. The trucks repossess were sold to buy Metro Motors for Rs.60,000, after necessary repairs amounting to Rs.10,000. Open the necessary ledger account in the books of both the parties.
21. Explain the different aspects of Human Resource Accounting in detail.
Discuss the need for social responsibility accounting and environmental account.