Mr. R. John, PGT(Commerce)
Answer all the questions
1. Give two example of not – for –profit organization
2. Write two items appearing the debit side of capital account when capital is fixed
3. How will you calculate interest on drawings when a partner withdraws a specific amount at the middle of every month?
4. How will you treat entrance fee while preparing accounts for not-profit-organization
5. Define partnership?
6. What is subscription? How is it calculated?
7. Differentiate between fixed capital and fluctuating capital
8. In the absence of partnership deed, how will you treat the following items?
a) Interest on Capital
b) Profit or Loss
c) Salary to a partner
d) Loans and advances by a partner
9. What is meant by income and expenditure account? How does it differ from receipts and payment account (Any 3 points?)
10. Show how you would deal with the following items in the final account of a club
Details Dr(Rs) Cr (Rs)
Prize fund 1, 00,000
Prize fund investments 1, 00,000
Income from Prize fund Investments 12,000
Prizes Awarded 9,000
- The following is the account of cash transactions of an arts club for the year ended 31 st March 2009.
Receipts Amount Payments Amount
Balance b/d 2,270 Rent 6,600
Subscription 32,500 Electric charges 3,200
Life membership fee 3,250 Lecturer’s fee 730
Donation 2,500 Office expenses 1,480
Printing charges 1,050
Profit from entertainment 7,250 Legal fee 1,870
Sales of old books
(Book value of Rs 1000) 750 Books 6,500
Furniture Purchased 8,600
Interest 350 Expense on drama 1,300
Cash in hand 8,040
Cash at bank 9,500
You are required to prepare an Income and Expenditure Account after the following adjustments
- Subscription still to be received as Rs 750 but subscription include Rs 500 for the year 2009-10.
- In the beginning of the year the club owned building Rs 20,000 and furniture Rs 3,000 and books Rs 2,000.
- Provide depreciation on furniture @ 5 % (Including purchase), books @10% and building @ 5%
12. Ramesh and Suresh were partners in a firm sharing profits in the ratio of their capitals contributed on commencement of business which were Rs 80,000 and Rs 60,000 respectively. The firm started business on 1st April 2008.According to the partnership agreement, interest on capital and drawings are 12% and 10% p.a respectively. Ramesh and Suresh are to get a monthly salary of Rs 2,000 and Rs 3,000 respectively.
The profits for year ended 31 st March 2009 before making above appropriations was Rs 1,00,300. The drawings of Ramesh and Suresh were Rs 40,000 and Rs 50,000 respectively. Interest on drawings amounted to Rs 2,000 for Ramesh and Rs 2,500 for Suresh
Prepare Profit and Loss Appropriation Account and Partner’s Capital Account, assuming that their capitals are fluctuating