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M.80 An Aid to Accountancy—CBSE XII
8. X, Y and Z are sharing profits and losses in the ratio of 5 : 3 : 2. They decide to share
future profits and losses in the ratio of 2 : 3 : 5 with effect from 1st April, 2018. They
also decide to record the effect of the following accumulated profits, losses and reserves
without affecting their book values, by passing an adjusting entry:

Book Values (`)
General Reserve 36,000
Contigencies Reserve 6,000
Profit and Loss A/c (Cr.) 18,000
Advertisement Suspense A/c (Dr.) 24,000
Pass the necessary single adjusting entry. (3)
9. On 1st April, 2017 Linux Ltd. issued 500, 9% Debentures of ` 500 each at a discount
of 4% redeemable at a premium of 5% after three years.
Pass necessary Journal entries for issue of debentures and debenture interest for
the year ended 31st March, 2018 assuming that interest is payable annually on
31st March, and the rate of tax deducted at source is 10%. The company closes its
books on 31st March every year.
Or
Simtech Ltd. issued 10,000; 10% Debentures of ` 120 each at 5% premium, repayable
at par.
Pass necessary Journal entries for redemption of debentures. (3)
10. To provide employment to the youth and to develop the Naxal affected backward
areas of Chattisgarh. X Ltd. decided to set-up a power plant in Chattisgarh. For raising
funds the company decided to issue 7,50,000 equity shares of ` 10 each at a premium
of 50%. The whole amount was payable on application. Applications for 20,00,000
shares were received.
Applications for 50,000 shares were rejected and shares were allotted to the remaining
applicants on pro rata basis.
Pass necessary Journal entries for the above transactions in the books of the company. (3)
11. A, B and C were partners. Their capitals were A—` 30,000; B—` 20,000 and
C—` 10,000 respectively. According to the Partnership Deed, they were entitled to
an interest on capital at 5% p.a. In addition, B was also entitled to draw a salary of
` 500 per month. C was entitled to a commission of 5% on the profits after charging
interest on capital, but before charging salary payable to B. Net Profit for the year
` 30,000 was distributed in the ratio of capitals without above appropriations. The
profit was to be shared in the ratio of 2 : 2 : 1.
Pass the necessary adjustment entry showing the workings clearly. (4)
12. The assets other than cash and bank transferred to Realisation Account are of
` 1,00,000. 50% of the assets are taken by a partner Atul, at a discount of 20%; 40%
of the remaining assets were sold at a profit of 30% on cost; 5% of the balance being
obsolete, realised nothing and remaining assets are handed over to a creditor, in full
settlement of his claim. You are required to record the Journal entries for realisation
of assets. (4)