Accountancy: 2014: CBSE: [All India]: Set – II
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Q1
Give the meaning of 'Reconstitution of a partnership firm'.
Marks:1View AnswerAnswer:
'Reconstitution of a partnership firm’ refers to any change in the existing partnership agreement. In this case, the old or existing partnership deed terminates and a new partnership deed comes into existence.
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Q2
D Ltd. invited applications for issuing 10,00,000 equity shares of
10 each. The public applied for 8,55,000 shares. Can the company proceed for the allotment of shares? Give reason in support of your answer.Marks:1View AnswerAnswer:
No, the shares cannot be allotted because subscribed shares are less than 90% (minimum subscription) of issued Capital of 10,00,000 shares. Atleast 9,00,000 shares should be subscribed, before the company can allot shares.
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Q3
X, Y and Z were partners sharing profits in the ratio of
. X retired from the firm. Calculate the gaining ratio of the remaining partners.Marks:1View AnswerAnswer:
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Q4
State the rights acquired by a newly admitted partner.
Marks:1View AnswerAnswer:
The new partner, on his/her admission, acquires following two main rights:
(i) Right to share the future profits of the firm.
(ii) Right to share the assets of the firm. -
Q5
Distinguish between 'Dissolution of partnership' and 'Dissolution of partnership firm' on the basis of Court's intervention.
Marks:1View AnswerAnswer:
Dissolution of partnership is always voluntarily carried out by the partners, while dissolution of firm can be carried out either voluntarily by the partners or compulsorily by order of court.
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Q6
A Ltd. forfeited 100 equity shares of
10 each issued at a premium of 20% for the non-payment of final call of
5 including premium. State the maximum amount of discount at which these shares can be re-issued.
Marks:1View AnswerAnswer:
Maximum amount of discount that can be allowed at the time of reissue is the amount received from the original shareholder before forfeiture of shares i.e.
7. -
Q7
What is meant by issue of debentures as collateral security?
Marks:1View AnswerAnswer:
Whenever a company takes loan from bank or any financial institution it may issue its debentures as secondary security which is in addition to the principal security. Such an issue of debentures is known as issue of debentures as collateral security.
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Q8
Hemant and Nishant were partners in a firm sharing profits in the ratio of 3 : 2.
Their capitals were
1,60,000 and 1,00,000 respectively. They admitted Somesh on 1st April, 2013 as a new partner for 1/5 share in the future profits. Somesh brought
1,20,000 as his capital.Calculate the value of goodwill of the firm and record necessary journal entries for the above transactions on Somesh's admission.
Marks:3View AnswerAnswer:
Somesh is admitted into partnership for 1/5th share in future profits. He contributes
1,20,000 for her share of capital.Taking Somesh’s capital as the base, we can calculate the firm’s capital.
Firm’s capital = New partners’ capital x reciprocal of new partner’s share i.e., = 1,20,000×5 =
6,00,000However, the total capital as at that date is
3,80,000 (i.e. 1,60,000 + 1,00,000 + 1,20,000).Thus, Hidden Goodwill =
(6,00,000 – 3,80,000) = 2,20,000Somesh’s share in goodwill = 1/5th of 2,20,000 =
44,000Journal
Date
Particulars
L.F.
Dr.
Cr.
Cash A/c
Dr.
1,20,000
To Somesh’s Capital A/c
1,20,000
(Capital bought in by Somesh reorded)
Somesh’s Capital A/c
Dr.
44,000
To Hemant’s Capital A/c
26,400
To Nishant’s Capital A/c
17,600
(Somesh’s share of goodwill is adjusted through capital accounts)
Note: it is assumed that the old partners are sacrificing in their old profit share because no additional information is given in the question.
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Q9
Tata Ltd. issued 5,000, 10% Debentures of
100 each on 1stApril, 2012. The issue was fully subscribed. According to the terms of issue, interest on debentures is payable half-yearly on 30th September and 31st March and tax deducted at source is 10%.
Pass the necessary journal entries related to the debenture interest for the half-yearly ending on 31st March, 2013 and transfer of interest on debentures to Statement of Profit and Loss.Marks:3View AnswerAnswer:
Tata Ltd.
Journal Entries
Date
Particulars
L.F.
Dr.
Cr.
2012 Sep. 30
Debenture Interest A/c
Dr.
25,000
To Income Tax Payable A/c
2,500
To Debentureholders' A/c
22,500
(Amount of interest due and TDS deducted for 6 months)
Sep. 30
Debentureholders' A/c
Dr.
22,500
To Bank A/c
22,500
(Amount of interest for 6 months paid to debentureholders)
Sep. 30
Income Tax Payable A/c
Dr.
2,500
To Bank A/c
2,500
(Amount of tax on interest paid)
2012 Mar. 31
Debenture Interest A/c
Dr.
25,000
To Income Tax Payable
2,500
To Debentureholders' A/c
22,500
(Amount of interest due and TDS deducted for 6 months)
Mar.31
Debentureholders' A/c
Dr.
22,500
To Bank A/c
22,500
(Amount of Interest paid to debentureholders)
March.31
Income Tax Payable A/c
Dr.
2,500
To Bank A/c
2,500
(Amount of tax on interest paid)
Statement of Profit & Loss
Dr.
50,000
To Interest on Debentures A/c
50,000
(Interest or debentures transferred to Statement of Profit and Loss)
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Q10
Pass necessary journal entries in the following cases :
(i) Sunrise Ltd. converted 500, 9% debentures of
100 each issued at a discount of 10% into equity shares of 100 each issued at a premium of 25%.
(ii) Britannia Ltd. redeemed 3,000, 12% debentures of 100 each which were issued at a discount of 10 per debenture by converting them into equity shares of 100 each 90 paid up.Marks:3View AnswerAnswer:
(i)
Sunrise Ltd.
Journal
Date
Particulars
L.F.
Dr.
Cr.
9% Debenture A/c
Dr.
50,000
To Debentureholders
45,000
To Discount on Issue of Debentures A/c
5,000
(Amount due to 500 debentureholders at the time of conversion)
Debentureholders’ A/c
Dr.
45,000
To Equity Share Capital A/c
36,000
To Securities Premium Reserve A/c
9,000
(360 equity shares of
100 each issued at premium of 25)Working Note:
Calculation of number of shares to be issued:
Net amount payable/Issue price of share
= 45,000 / 125 = 360 shares
(ii)
Britannia Ltd.
Journal
Date
Particulars
L.F.
Dr.
Cr.
12% Debentures A/c
Dr.
3,00,000
To Debentureholders’ A/c
2,70,000
To Discount on Issue of Debentures A/c
30,000
(Amount due to 3,000 debentureholders at the time of conversion)
Debentureholders’ A/c
Dr.
2,70,000
Discount on Issue of Shares A/c
Dr.
30,000
To Equity Share Capital A/c
3,00,000
(3,000 equity shares of
100 each issued at 90 each paid)Working Note:
Calculation of number of shares to be issued:
Net amount payable/Issue price of share
= 2,70,000 / 90 = 3,000 shares
