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# ICSE Set Set1 98 Year Icse Account Set1 98.php Exam Paper ICSE Board Exam Paper for students online

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Accounts - 1998 (I.C.S.E)
You on questions 1 to 3

Time allowed: 2 hours

Answers to this paper must be written on the paper provided separately.

-You will NOT be allowed to write during the first 15 minutes.
-This time is to be spent in reading the question paper.
-The time given at given at the head of this paper is the time allowed for writing the answers.
-All working, including rough work, must be clearly shown ; it should be done immediately before/after the rest of the answers.

PLEASE ALSO NOTE that parts of the same questions MUST BE DONE continuously so as to facilitate evaluation
-
Attempt all questions from Section A and two questions form Section B.
- The intended marks for questions or parts of questions are given in brackets [  ].

SECTION - A

Q 1(a) The following questions has to be answered using two columns.Rewrite Column I in the order given.Column II contains descriptive phrases for items given in column I.Match the phrases to suit the items given in column I by selecting phrases from Column II. Ignore those that remain.

 Column I Column II (i) Depreciation Cost of Goods sold (ii) Fixed capital Method Ideal situation reflect 3:2 (iii)'Materials consumed' two and not seven persons is the minimum number (iv) Partnership firms indicates the owner's interest (v) Working capital ratio needs Current A/c for completing details (vi)Proprietory Fund could be because of efflux of time. also referred to as Fixed instalment Method. Norm 1:2 Ratio.

Q 1(b) From each set given below ,pick out the odd one. Answer  in the given serial order :-

(i) Cost price of sales ; goods sold at cost price : Sales less returns inward ; materials   consumed
(ii) With reference to practical work in partnership firms : Interest on capital ; interest on loan borrowed from a partner ; Commission allowed to a partner ; Interest on current account charged to a partner.

(iii) Assets bought on credit ; Expenses incidential to the asset bought payable ; part of the assets bought on credit rejected  because defective ; payment due with reference to the assets ,made and recorded.
(iv)Direct expenses ; financial expenses ; Selling expenses ;Administrative expenses .

(v). Fixed instalment  method ; original cost price method ; Written down value method ; Straigth line method .

(vi) Pre paid  insurance ; Deffered Advertising ;pre received rent; unused Fuel.

(vii)Capital fund ;Special fund ;general fund ; Common fund

(viii) Freigth ; Octroi ;Sales tax ;imported Duty.

Q1(c) Write explanatory notes on :-
(i) Depreciation is accounted annually
(ii) Quick Ratio
(iii)fixed Capital method

Q 2
trial Balance of mr. j Junior as on 31.3.1997:-
Debit                               Credit
factory power                                                         16000
Carrier charges                                                         2500
Salaries                                                                  20400
Sales & purchase of goods                                      140000                          267000
Machinery( mannufactured through
factory workers)                                                     120000
Discounts   received and allowed                                  5000                             6000
Wages(manufacturing activity )                                  18000
Stock                                                                       25000
Commission                                                             3800
Insurance(1/4 is a personal expenses)                         8000
Goods taken home in Dec,1996                                                                        5000
Loose Tools (Fixed Assets)                                         11000
Returns of goods                                                         5000                               6000
Debtors & Creditors                                                   45000                             18000
Carriage on sales                                                        6000
Rent & Rates(paid during this year)                             10800
Bad Debts written off & recovered                                2000                                1600
Investments as from 1-1-1997                                    80000
Bank accounts                                                           22000                              10000
Drawings & Capital                                                     15000                            237000
Bills Payable & Receivable                                            6000                                4000
Income from Investments applicable @ 10%p.a                                                    1800
Cash                                                                      2500
560200                          560200

Compile Final Accounts, incorporating the following adjustments for the owner.
(i) The expenditure per accounting year is as follows for -
Rates          Rs 10000
Rent           Rs   3000
(ii) Wages include Rs 5500 which was actually salaries and salaries are payable at the rate of Rs7000 per quarter for the 12 months of this accounting year.
(iii) An inventory of the godown on 31-3-1997 reflected stock value stated as Rs 50000. This included a personal consignment for Rs10000 (awaiting cartage to country home), wrongly listed in the unsold inventory.

SECTION - B

-Answer any two questions from the four question given below :
-Where required, stretch your answer for a question across the double sides of the writing paper to ensure neatness and consequent accuracy and speed in ca
lculations.

Q 3 Give complete journal entries of the following sets, clearly indicating the sections and sub-sections to facilitate accurate corrections:
(a) (i) Furniture of book- value Rs10000 to be depreciated by Rs750 and sold for Rs8250 cash.
(ii) Office premises on lease for ten years, total cost Rs 1000000. Account for its annual depreciation in the fifth year of its use.

Q 3 (b) (i)Account for the year's net profit of Rs 250000 earned by a firm,M/s Shroff and Bros., so that the work of appropriation of profit as per the Articles of partnership can be completed.
(ii)Account for Rs 25000 set aside anually as General Reserve by the above firm.Ans:Date

Q 3 (c)(i) Account for the closing inventory reported as Rs88000, an overvaluation by 10%.
(ii)20% of debtors Rs 60000, long overdue , are to be written off as Bad Debts.
(iii)Close the following accounts for an accounting year :

 Sales returns 20000 Purchases 350000 Freight 7000 Sales 500000 Purchases Returns 15000 factory expenses 35000 Stocks(b/f from previous year) 30000

Q 3(d) (i) give the adjustment entry for Honorarium expenses of Rs 80000 for a year of which Rs77000 only has been paid by the end of the year .
(ii) Account for the years surplus of Rs 55000

Q 4 (a) M/s Ram and Rahim in the construction line bought three cement mixers costing Rs120000 each on July 1, 1995. They expected  to fetch a scrap value of Rs 20000 per mixer after using each of them for four years.
Accordingly, the Fixed Installments Method was used for two accounting years. At the end of the second accounting year, one mixer was sold off, fetching an immediate cheque payment of Rs 50000
From April 1, 1997, it was decided to apply the written Down Value Method @30% p.a for depreciation. Prepare the current mixtures A/c for three years ending on 31-3-1998, incorporating the above data.

Q 4(b) Answer the following questions , based on the data given :
i)Value of Capital Employed
ii)Value of Quick Assets
iii)Value of Non-Quick Liabilitiesa
iv)State the equation for and then work out the Debt Equity Ratio.
Balance Sheet of Mr. Go Getter as on 31-3-1997

 Rs Rs Capital 90000 Goodwill 25000 Reserve 10000 Fixed Assets 60000 Long- term loans 20000 Investment 20000 Creditors 7000 Debtors 8000 Bank O.D 3000 Cash & Bank 5000 Accruals 5800 Accruals 1400 Income of the coming year 600 Pre-paid & Deferred expenses 2000 136400 Stock 15000 136400

Q 5 River, Well, Spring and Lake are in partnership. Their firm name is Plentiful Waters & co.They have mutually agreed to :
(i) Allow Interest on Capital @ 15% p.a.
(ii) Charge Interest on Drawing @ 10% p.a.
(iii) Accept Well's claim for a salary of Rs.6000 per month for six months only for round the clock work put in by him in the drought stricken areas
(iv)Charge an annual allowance of Rs.1500 per two months per partner to the buisness to help cover expenses and compete successfully with cut-throat competition
(v) River and Well have each contributed equally towards total Loan Capital of Rs.10,00,000  borrowed by the firm from them.
(vi) Rs.20000 p.a. is set aside as Reserve if the Net profit available for appropriation is greater than Rs.5,10,000.
(vii) For sharing the residue of profits, River's profit share is 50% . Partners Well, Spring , and Lake get their share from the remaining profit in the ratio of 2 : 2: 1
The required data for the year 1-4-95 to 31-1-96 is-
(a) Capital- River Rs. 6,00,000 , Well Rs.400000 Spring and Lake 500000 Rs. each
(b) Each withdrew 10% of their opening capital balances as on 1-4-95 as drawings for the years .
(c) The years net profit b/d from the Profit / Loss A/c is reported as Rs.5,06,000.   Its scrutiny reveals that the partners annual allowance was debited in the P/L A/c and that Rs.20000 payable to the buisness manager as his special commission had not been accounted for at all.

Compile the Profit and Loss Appropriation A/c only.using the facts and financial data given.

Q 6 Compile final accounts for the club for the year ending 31-3-1996.
Active action Club Balance Sheet as on 31-3-1995.

Club Fund (includes all legacies received 35,000 Land 3,00,000
Income & Expenditure A/c credit Balance 25,000 Furniture & Sports Equipment 64,000
Sports Complex Fund 10,00,000 Sports Complex in use Refreshment Room - Stock of supplies 5,800
Cash & bank 5,200
13,75,000   13,75,000
Receipts & Payment A/c for the year ended 31-3-1996
 Particulars Rs Particulars Rs To Cash & Bank balances 5,200 By Refreshment Room-supplies 75,000 To Life Membership Fees (capitalised 40%) 60,000 By Honorarium to Coaches 35,000 To Grant 60,000 By Annual Celebrations 45,000 To Annual Celebrations - Receipts 60,000 By Investment short term 2,75,000 To Legacy (by the will of Late Mr. Go Ahead, founder President) 7,00,000 By Extension to Sports Complex (under construction as yet) 4,50,000 To Refreshment Room Receipts 1,20,000 By Club expenses 37,400 By expenses on activities 60,000 By Cash & Bank balances 27,800 10,05,200 10,05,200