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M.384                                                An Aid to Accountancy—CBSE XII

                      14.  How will be the following items dealt while preparing the Income and Expenditure
                          Account of Young India Club for the year ending on 31st March, 2018 and Balance
                          Sheet as on that date?
                     Particulars                                           1st April, 2017 (`)   31st March, 2018 (`)
                     Subscription Due                                          38,000         28,000
                     Subscription Received in Advance                          11,200         20,800
                     Outstanding Salaries                                      60,000         36,000
                     Prepaid Salaries                                          20,000         12,000
                     Amount due to Suppliers of Sports Materials               60,000         36,000
                     Advance to Suppliers of Sports Materials                  20,000         12,000
                     Stock of Sports Materials                                 60,000         28,000

                          Additional Information:
                           (i)  During the year ended 31st March, 2018, payment made to suppliers of Sports
                              Materials was ` 2,16,000 and cash purchases of sports materials amounted to
                              10% of credit purchases.
                          (ii)  Subscription received during the year was ` 5,95,600.
                         (iii)  Salaries paid during the year was ` 2,16,000.                        (6)
                      15.  Pass necessary Journal entries for the following transactions on the dissolution of the
                          firm of A and B after the various assets (other than cash) and outside liabilities have
                          been transferred to Realisation Account:
                           (i)  A agreed to pay his wife’s loan of ` 20,000.
                          (ii)  A debtor whose debt of ` 8,000 was written off as bad in the books paid ` 7,500 in
                              full settlement.
                         (iii)  Sundry Assets were of ` 1,17,000. B is to take some Sundry Assets at ` 72,000
                              (being 10% less than book value). A is to take remaining Sundry Assets at 80% of
                              the book value.
                          (iv)  C’s Loan of ` 10,000 was paid along with accrued interest of ` 200 (not yet recorded).
                          (v)  A agreed to take over the responsibility of completing dissolution at an agreed
                              remuneration of ` 3,000 and to bear all realisation expenses. Actual realisation
                              expenses amounted to ` 4,000 were paid by A out of his private funds.
                          (vi)  Loss on realisation ` 9,400 was divided between A and B in 3 : 2 ratio.
                                                             Or
                          A, B and C were equal partners. On 31st March, 2018, their Balance Sheet stood as:
                     Liabilities                         `      Assets                             `

                     Creditors                          50,400  Cash                                3,700
                     Reserve                            12,000  Stock                              20,100
                     Capital A/cs:                              Debtors                            62,600
                     A                          30,000          Investments                        16,000
                     B                          25,000          Furniture                           6,500
                     C                          15,000   70,000   Building                         23,500
                                                       1,32,400                                   1,32,400
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