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Punjab (PTB) · Half book test · Free

2nd Year Principles of Accounting First half Book Paper

50 marks · 1 hour 30 minutes · 35 questions. Covers: 5 chapters (CHAP 1: Accounts from Incomplete Records to CHAP 5: Depreciation, Provisions and Reserves).

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2nd Year Principles of Accounting First half Book Paper

2nd Year · Principles of Accounting · Punjab (PTB)

Name: ____________Roll No: ________Class/Section: ________Date: ________Total marks: 50Time: 1 hour 30 minutes

Q1. Multiple choice questions (Attempt all · 15 × 1 = 15)

  1. The remuneration which is paid by company to underwriter is called:

    1. Commission

    2. Del-Credit commission

    3. Overriding commission

    4. Under-writing commission

  2. Consignment account is a nature of:

    1. Personal account

    2. Real account

    3. Nominal account

    4. “a” and “b”

  3. The journal entry for depreciation will be:

    1. Depreciation account …Dr To asset account

    2. Depreciation account …Dr To cash account

    3. Depreciation account …Dr To bank account

    4. Asset account …Dr To depreciation account

  4. It is prepared by non-profit making organization to determine surplus or deficit:

    1. Trading account

    2. Profit and loss account

    3. Receipts and payment account

    4. Income and expenditure account

  5. In increased net worth method, profit or loss is calculated by preparing:

    1. Income and expenditure account

    2. Profit and loss account

    3. Statement of profit or loss

    4. Balance sheet

  6. It is that portion of subscribed capital which has been called up by the company:

    1. Called up capital

    2. Paid up capital

    3. Subscribed capital

    4. Issued capital

  7. When goods are dispatched by the consigner to the consignee, it will be from consignor’s view point:

    1. Consignment inward

    2. Consignment outward

    3. Consignment in transit

    4. All of these

  8. What will be entry when profit is earned on sale of asset:

    1. Cash account …Dr To profit and loss account

    2. Profit and loss account …Dr To cash account

    3. Asset account …Dr To profit and loss account

    4. Profit and loss account …Dr To asset account

  9. Income and expenditure account records the transactions of:

    1. Revenue nature

    2. Capital nature

    3. Revenue and capital nature

    4. None of these

  10. The format sketch of statement of affairs is similar to:

    1. Trial balance

    2. Profit & loss account

    3. Balance sheet

    4. Income & Expenditure account

  11. Premium on issue of shares is shown on:

    1. Debit side of trading account

    2. Debit side of profit and loss account

    3. Asset side of balance sheet

    4. Liability side of balance sheet

  12. In consignee’s book, the acceptance given of a bill should be debited to:

    1. Bill receivable account

    2. Bill payable account

    3. Consignee’s account

    4. Consignor’s account

  13. Which one is the merit of fixed installment method:

    1. Simplicity

    2. Asset can be written of to zero

    3. Useful for providing depreciation on leasehold property, patents and other like assets

    4. All of above

  14. Donations Rs.50,000, 100% capitalized should be recorded in:

    1. Receipts and payments account

    2. Income and expenditure account

    3. a & b

    4. Receipts and payments account and balance sheet

  15. Due to drawings made during the year, the closing capital will:

    1. Increase

    2. Decrease

    3. Constant

    4. Multiply

Q2. Short questions (Attempt any 10 of 15 · 10 × 2 = 20)

  1. For goods sold by consignee, pass the entries in consignor and consignee books.

  2. What do you mean by the term depletion?

  3. What is capital fund?

  4. Write the equations to calculate the value of adjusted capital (at the end) and profit or loss under single entry system.

  5. Under what conditions a company can issue its shares at discount.

  6. Pass the entries for goods taken over by consignee for personal use in consignor and consignee books.

  7. What is obsolescence?

  8. Write the two differences between “Receipts and payments account” and “income and expenditure account”.

  9. How many methods are available for the determination of profit or loss under single entry system?

  10. Define the following:       Directors, Promoters, Underwriters, shareholders

  11. Pass the entries for profit earned on consignment in consignor and consignee books.

  12. What is meant by efflux of time in depreciation?

  13. What is special subscription?

  14. What is statement of affairs?

  15. What is memorandum of association?

Q3. Long questions (Attempt any 3 of 5 · 3 × 5 = 15)

  1. Prepare a Trading Profit and Loss Account for the year ended 31st December, 2022 and a balance sheet as on that date.
    Mr. Tipu keeps his books under single entry system. The position of his business as on 1st Jan., 2022 was as under:
    Sundry creditors Rs. 17,000; Freehold premises, Rs. 50,000; stock Rs. 25,000; Sundry Debtors Rs. 20,000; Furniture Rs. 2,000. An abstract of Cash book is appended below:

    Receipts Rs. Payments Rs.
    Sundry Debtors 15,000 Overdraft ( 1.1.2016) 10,000
    Cash Sales 80,000 Expenses 50,000
        Drawings 3,000
        Sundry creditors 20,000
        Cash in hand 2,000
        Cash at bank 10,000
      95,000   95000

    The following additional information is available:
    Closing stock Rs. 30,000; Closing Debtors Rs. 25,000; closing creditor Rs. 12,000. No additions were made during the year to premises and Furniture account, but they are to be depreciated at 10% and 15% respectively. A bad debts reserve on 21/2 % is to be raised.

  2. The following is the statement of Receipts and Payments of Mumtaz Hospital for the year ending 31st December 2022.

    Opening Balance Rs. Payments Rs.
    Cash 1000 Salaries 46,000
    Bank 16000 Diet Expenses 5000
    Govt. Security 360,000 Surgery Expenses 2400
    Receipts:   Office Expenses 1400
    Subscriptions 50,000 Miscellaneous Expenses 200
    Interest 18,000 Closing Balances:  
    Donations 8000 Bank 36,000
    Miscellaneous 600 Cash 2600
        Govt. Security 360,000
      453,600   453,600

    You are asked to prepare the Income and Expenditure Account for the year and balance sheet on 1st January 2022. The other assets on 1st January 2022 were: Furniture, Rs. 4000; Land, Rs. 100,000; Building Rs.300,,000; Instruments, Rs. 7000. The Govt. Securities of the face value of Rs. 4,00,000 (cost Rs. 360,,000). The subscriptions received include Rs. 20,000 for the year 2021 but Rs.14000 is outstanding for 2022 Interest received includes Rs. 400 for 2021 but Rs. 4600 is outstanding for 2022.

  3. A firm purchased a machine for Rs. 420,000 on 1st July, 2019 and spent Rs. 48,000 as wages and installation charges. Prepare the machine account for the first four years under diminishing balance method of depreciation assuming that the accounting year of the firm ends on 31st December every year. Rate of deprecation is 10% per annum.

  4. Pass the following entries of debentures in each case:
    (i) Debentures issued at Rs. 90 and redeemable at Rs. 100.
    (ii) Debentures issued at Rs. 100 and redeemable at Rs. 110.
    (iii) Debentures issued at Rs. 110 and redeemable at Rs. 100.
    (iv) Debentures issued at Rs. 90 and redeemable at Rs. 110.
    (v) Debentures issued at Rs. 100 and redeemable at Rs. 100.

  5. Prepare necessary ledger accounts in the books of the consignor.
    Zaheer & Sons of Karachi dispatched a consignment of 400 cases of Electric bulbs to Hammad of Kohat on 1st December 2022. The cost price was quoted at Rs. 360,000. On 25th December Hammad sent an account sales with the following details:
    (a) 75% of goods were sold for Rs. 270,000.
    (b) Hammad paid unloading charges Rs. 2400.
    (c) Advertisement and selling expenses paid by Hammad amounted to Rs. 1400.
    (d) Hammad is to receive a commission of 5% on sales.
    At the time of dispatch Zaheer & Sons incurred an expenditures of Rs. 4,000 towards freight and insurance charges.