APEEJAY COMMON PRE-BOARD EXAMINATION

SESSION 2022-23
CLASS: XI
SUBJECT: ACCOUNTANCY (055)

TIME: 3 HOURS Max Marks: 80

General Instructions:

1. This question paper contains 34 questions. All questions are compulsory.

2. This question paper is divided into two parts, Part A and B.
3. Question 1 to 16 and 26 to 29 carries 1 mark each.
4. Questions 17 to 20, 30,31carries 3 marks each.
5. Questions 21 and 32, 33 carries 4 marks each
6. Questions 22 to 25 and 34 carries 6 marks each
7. There is no overall choice. However, an internal choice has been provided in 7
questions of one mark, 2 questions of three marks, 1 question of four marks and 2
questions of six marks.

PART-A

1 The debts which are to be repaid within a short period (a year or less) are referred to as: 1
a) Fixed Liabilities b) Contingent Liabilities
c) Current Liabilities d) All of the above

2 Wages paid to a worker making additions to machinery amounting to Rs 5000 were debited to the 1
wages account. Identify the type of error:
a) Error of principle. b) Compensating error
c) Error of omission d) Error of commission.
OR
If the Trial Balance agrees, it implies that:
a) there is no error in the books.
b) there may be two sided errors in the book.
c) there may be one sided error in the books.
d) there may be both two sided and one sided errors in the books.

3 Goods and services tax collected by the seller is a/an ________ for him: 1
a) asset b) liability
c) income d) loss

4 Roma, the proprietor of M/S R.K. & Co. purchased an air conditioner and installed it at her 1
residence. The payment was made by issuing a cheque from the account of M/S. R.K. & Co. The
accountant debited the drawings account. Which principle of accounting did he apply:
a) Business entity Concept b) Going Concern Concept
c) Materiality Concept d) Money Measurement Concept

5 As per modern classification of accounts, Outstanding Expenses Account is: 1

a) Revenue b) Expenditure
c) Liability d) Asset
6 Raj purchased on credit goods for Rs5, 00,000 less 20 % trade discount. As per the terms, he can 1
deduct 4% cash discount if he pays the full amount within 15 days. What amount he will have to
pay to avail the cash discount?
a) Rs 3,84,000 b) Rs 2,84,000 c) Rs 3,76,000 d) Rs 3,94,000

7 What will be the value of an asset at the end of fifth year from its date of purchase if the asset was 1
purchased for Rs 75,000 with salvage value Rs5,000 at the end of its useful life of 7 years the
depreciation would be charged as per Straight Line Method.
a) Rs 50,000 b) Rs 25,000 c) Rs 75,000 d) Rs 10,000
OR
On 31 March 2022, half of the machine purchased on 1st April 2019 for Rs 40,000 was sold for
st

Rs 9,500. At the end of every year depreciation is charged @ 10% p.a. on original cost.
Calculate the amount of profit or loss on the sale of machine.
a) Rs 5,000 b) Rs 4,500 c) Rs 2,800 d) Rs 2,500

8 There are two statements marked as Assertion (A) and Reason (R). Read the statements and 1
choose the appropriate option from the options given below:
a) Both Assertion (A) and Reason (R) are true and Reason (R) is the correct explanation of
Assertion (A).
b) Both (A) and (R) are true, but R is not correct
c) (A) is false, but (R) is true
d) (A) is true but (R) is false

Assertion (A) In large businesses, journal is subdivided into special journals.

Reason (R) Special journals prove economical and make division of labor possible in
accounting work.

9 When the goods are purchased against cash, the purchaser will get: 1
a) Cash Memo b) Accounting voucher
c) Invoice d) None of these
OR
A trader deposited Rs 40,000 in Bank. The accountant needs to prepare a source document
which will act as an evidence of this transaction. Name the source document prepared.
a) Debit Note b) Cheque c) Pay in slip d) Credit Note

10 Ajay wants to start a business in a systematic manner. Which accounting system he should follow? 1
a) Single Entry System
b) Double Entry System
c) Cash basis
d) Accrual basis
OR
Which of the following is not an objective of accounting?
a) Maintaining records
b) Estimating profit and loss
c) Providing useful information to various users
d) Recording all the qualitative factors
11 Goods sold to Sethi for Rs 640 was recorded in his account as Rs 460. In the rectifying entry, 1
Sethi’s A/c will be debited with
a) Rs 180 b) Rs 460 c) Rs 640 d) Rs 1,100

12 Which is the last step of accounting as a process of information: - 1

a) Preparation of financial statements b) Analysis and interpretation of information
c) Communication of information d) Recording economic events in the books of account.
OR
Use of common unit of measurement and common format of reporting promotes:
a) Reliability b) Relevance c) Understandability d) Comparability

Read the following hypothetical Case Study and answer the given questions 13 and 14:
The business which follows the convention of prudence keeps provisions and reserves so that they
can keep the liquidity of the firm and help it in the time of crisis. But, what are exactly Reserves
and Provisions. When we talk about provisions, they mean setting aside a part of the profits for
meeting a known future liability, the amount of which is not accurately known at the time of
finalization of financial statements. It is made for meeting known future liability. The amount of
the liability cannot be determined accurately. It is charge against profit reducing the profit.
Provisions serve a lot of purposes. It helps in ascertaining the true net profit of the entity. The true
financial position can be determined adequately. It helps in providing funds for the liabilities that
may occur in future. It helps in the proper allocation of expenses that are incurred over the time.
Reserves, on the other hand, means an appropriation of profits or other surplus to strengthen the
liquid resources of the business enterprise and not for meeting any liability, contingency or any
commitment of the business. They are retained or undistributed net profit. It is voluntarily done to
strengthen the financial position of the firm. It can be used for investing in outside securities.
Like provisions, reserves are also very important for the business enterprises. It helps in meeting
any unforeseen expenses. It strengthens the financial position of the firm. It helps in equal
distribution of profit. It helps in providing funds to meet liability.

13 Which of the following is not a characteristic of Provisions? 1

a) It is made for meeting known future liability.
b) The amount of the liability cannot be determined accurately.
c) It is charge against profit reducing the profit.
d) They are retained or undistributed net profit.

14 Which of the following is not an importance of Reserve? 1

a) It helps in meeting any unforeseen expenses.
b) It strengthens the financial position of the firm.
c) It helps in equal distribution of profit.
d) It helps in providing funds for the liabilities that may occur in future
OR
Which of the following statements is NOT true about Reserves?-
a) it is an appropriation of profit. b) it is shown on the liability side of Balance Sheet.
c) It is a charge against profit. d) it is discretionary as a matter of financial prudence

15 The book value of machinery on the date of sale is Rs 45,000. The original price of it was 1
Rs 85,000. The company sold it at a loss of Rs7,000. What is the sale proceed?
a) Rs 92,000 b) Rs 78,000 c) Rs 52,000 d) Rs 38,000
16 Furniture A/c shows an opening balance of Rs 5,00,000. Furniture with a book value of 1
Rs10,000 was sold during the year. New furniture was purchased for Rs 40,000. Depreciation
provided Rs 5,000. The closing balance of Furniture A/c is Rs __________.
Rs 5,40,000 (b) Rs 5,30,000 (c) Rs 5,25,000 (d) Rs 4,95,000

17 Although, written down value method is based upon a more realistic assumption, it suffers from 3
some limitations. Give any three such limitations.
18 Explain the following terms: 3
a) Working capital
b) Trade discount
c) Accounting standard
OR
Explain any two of the following accounting Concepts/Principles:
a) Dual Aspect
b) Accrual
c) Conservatism

19 Prepare Double Column Cash Book with cash and bank column from the following information: 3
Date Particulars Amount. (Rs)
2021
Aug. 1 Bank 10,000
Aug. 1 Cash in hand 40,000
Aug. 3 Sold goods to Ranjan, payment received by cheque 78,000
Aug. 9 Cash withdrew from bank 4,000
Aug. 10 Ranjan’s cheque deposited into bank.
Aug.14 Goods purchased from Riya and Payment made by cheque. 5,000
Aug. 20 Salary paid 3,000
Aug. 24 Received Interest from Soham 4,800
Aug. 27 Paid Life Insurance Premium from cheque. 5,000
Aug. 28 Ranjan’s cheque dishonoured.
OR
Enter the following transactions in Sales book of Rajani Electric Store, Delhi
2022
July 14 Sold on credit to Ravi Electric Store, Faridabad.
200 Tube lights @ 100 each
100 table fans @ 600 each
200 Desert Coolers @ 2000 each
Trade discount 10%
July 24 Sold to National Traders, New Delhi
40 Doz. Bulb @ 150 per Doz.
50 celling Fans @ 1200 each
50 room coolers @ 1500 each
Trade Discount 15%
July 28 Sold to Indus Ind. For cash
20 Doz. Mercury Bulb @ 50 each
10 Doz. Halogen Bulb @ 100 each
5 Doz. Bulb @ 120 per Doz.
 10 Box jagmag Bulb @ 120 each
Trade discount 20%

20 You are required to Redraft the correct Trial Balance from the following Trial Balance drawn 3
from the books of Saurabh Traders. Put the difference if any in the Suspense Account:
Trial Balance as on……
Debit Balances Amount (Rs) Credit Balances Amount (Rs)

Machinery 65,000 Capital 2,12,100

Return inwards 2,600 Land 5,000
Bank overdraft 2,500 Bills Receivables 80,000
Bills Payable 10,000 Commission received 3,000
Purchases 2,00,000
Creditors 20,000
3,00,100 3,00,100

21 A) An Investment company has been valuing its inventory of land at lower of market price 4
or cost. It now wants to value its inventory at the current market price which is higher
than the cost. Explain the accounting concept violated by the company in the given case.
B) “Capital is a liability for the Business “Explain this statement with the principle.

22 Give the Journal Entries to rectify the following errors using Suspense account, where necessary: 6
a) Goods of the value of Rs 2000 returned by Mr. Gupta were entered in the Sales Day Book
and posted there from to the credit of his account.
b) An amount of Rs 2,000 due from Mahesh Chand which had been written off as a bad-debts
in previous year, was recovered and has been posted to the personal account of Mahesh
Chand.
c) Goods (cost Rs 5,000, sales price Rs 6,000) distributed as free samples among prospective
customers were not recorded anywhere.
d) Acquisition charges on the purchase of a new building amounting to Rs 5,000 were debited
to the sundry Expense account.
e) Bought goods for Rs 10,000 for certain employees of the firm but the same was debited to
Purchase account. The employee was paid their salaries after deducting the aforesaid sum.
f) Old machinery sold to Karim at its book value of Rs 2,000 was recorded through sales
book.

23 On 31st March 2022, the Cash Book of Kailash Brothers showed a debit balance of Rs 2,14,460. 6
From the following particulars prepare a Bank Reconciliation Statement and ascertain the Balance
as per Pass Book.
a) Cheque issued but not presented for payment Rs 7,375.
b) Cheques paid into bank but not yet cleared Rs 1,175.
c) Interest credited by bank but not entered in cash book Rs 2,150.
d) Bank charges debited in the Pass Book but not entered in the Cash Book Rs 700.
e) Bank deposited a dividend of Rs 5,000 to the Bank Account.

These transactions were not recorded in Cash Book.

24 Journalise the following transactions in the books of Himanshu: 6

 a) Received Rs 975 from Harikrishna in full settlement of his account for Rs 1,000.
b) Goods costing Rs 1,00,000 were destroyed in fire. Insurance company admitted the
claim for Rs 75,000.
c) Provide 10% depreciation on machinery Rs 50,000
d) Goods used in making furniture (sales price Rs 2000, cost Rs 1,500)
e) A debtor from whom Rs 1,000 was due became insolvent and his account is to be written
off as bad
f) Charge interest on drawing Rs 400

25 Yojna Ltd. purchased a plant on 1st April, 2019 for Rs 1,50,000. It purchased another plant on 1st 6
October, 2019 costing Rs 2,00,000 and on 1st July 2020 costing Rs 3,00,000. On 1st January, 2022
the plant purchased on 1st April, 2019 become useless and was sold for Rs 20,000.

Show plant Account charging 10% p.a. depreciation by diminishing balance method for three
years 2019-20, 2020-21 and 2021-22. Accounts of the company are closed on 31st March each
year.
OR
st
Darun & Co. purchased a machine on 1 April, 2019 for Rs 2,00,000. It purchased another machine
on 1st January, 2020 costing Rs 2,00,000 and on 1st July 2020 costing Rs 2,50,000. On 1st January,
2022 the machine purchased on 1st April, 2019 become useless and was sold for Rs 40,000.
Show Machine Account charging 10% p.a. depreciation by diminishing balance method for three
years 2019-20, 2020-21 and 2021-22. Accounts of the company are closed on 31st March each
year.

PART-B
26 Identify the principle/convention involved in making provision for doubtful debts in profit 1
and loss account:
a) Convention of conservatism b) Convention of consistency
c) Convention of disclosure d) None of these
OR
Prepaid Insurance in the Trial Balance is shown in the Balance Sheet in the Asset side
because of:
(a) Cost Principle b) Accrual Concept
(c) Materiality Concept d) Matching Principle.

27 Accrued Income, if given in the Trial Balance, is shown in: 1

a) Trading Account, as addition to respective income.
b) Profit and Loss Account, as addition to the respective income.
c) Profit and Loss Account, as addition to the respective income and in the Balance Sheet,
as an Asset
d) Balance Sheet as an Asset.

28 Calculate the amount of commission to be shown in books of accounts : 1

Gross Profit: Rs 2,00,000, Rent paid for the year: Rs 48,000, Salary: Rs 8,000,
General expenses: Rs 4,000 and rent is paid in advance for 1 month.
Manager is allowed a commission of 10% on net profit before charging such commission.
Rs 14,000 b) Rs 14,200 c) Rs 14,400 d) Rs 14,500
29 Rent paid during the year amounted to Rs 3,00,000, which includes Rs 20,000 relating to the 1
previous year and Rs 20,000 relating to the next year. Rs 30,000 relating to the current year
is still outstanding. How much rent will be debited to the profit & Loss account of the current
year?
a) Rs 2,00,000 b) Rs 2,90,000 c) Rs 2,15,000 d) Rs 2,80,000

30 Write down any three characteristics of Balance Sheet. 3

31 Calculate Closing stock from following details 3

Opening stock Rs 20,000
Cash Sales Rs 60,000
Credit Sales Rs 40,000
Purchases Rs 70,000
Rate of Gross profit on cost 33 1/3%

32 Balance of Provision for Doubtful Debts as on 1st April 2021 Rs 2000; Bad debts during the 4
year were Rs 600; New Provision for doubtful Debts is required @ 10 % on debtors of Rs
15000. Calculate amount of Provision for Doubtful Debts to be shown in Profit and
Loss Account.
OR
From the following information and adjoining adjustments, prepare Profit & Loss Account
and Balance Sheet (do not close Profit & Loss Account and Balance Sheet):
Particulars Debit (Rs) Credit (Rs)
Debtors 70,000
Bad debts 400
Reserve for bad debts 1,000
Adjustments: Provide reserve for bad and doubtful debts @ 6%.

33 a) Operating profit earned by M/s Vaani in 2021-22 was Rs 20,00,000. Its Non- 3+1
operating incomes were Rs 2,00,000 and Non-operating expenses were Rs 4,25,000.
Calculate amount of net profit earned by the firm.
b) Explain the term Capital Expenditure (with example).
OR
a) From the following, calculate Operating Profit:
Particulars Amount (Rs)
Net Profit 4,00,000
Rent Received 40,000
Gain on Sale of Machine 20,000
Interest on Loans 50,000
Donation 20,000

b) Explain the term Deferred Revenue Expenditure (with example)

34 The following Trial Balance was drawn up from M/s. B & B Books at the end of the year 6
ending 31st March 2022. Prepare Trading and Profit and Loss Account and Balance sheet as
on 31st March 2022.
Particulars Amount (Rs) Particulars Amount (Rs)
st
Stock (1 April 2021) 32,000 Capital 2,00,000
 Debtors 64,000 Sales 51,000
Machinery 60,000 Trade payables 18,000
Wages 20,000 Discount (Received) 2,000
Salary 8,000
General expenses 10,000
Cash 42,000
Purchases 35,000
2,71,000 2,71,000
Adjustments:
a) Stock on 31st March 2022 Rs 42,000
b) Machinery is to be depreciated by 10% p.a.
c) Salary Outstanding Rs 400
d) Stock valued Rs 3,000 were taken by the owner for his personal use, cost of which has
not been adjusted in the books of accounts.
OR
From the following Trial Balance Prepare Trading Account, Profit & Loss Account and the
Balance Sheet as on 31st March 2022:
Particulars Amount (Rs) Particulars Amount (Rs)

Purchases 1,60,000 Capital 1,80,000

Bank balance 22,000 Bills Payables 1,800
Wages 6,800 Sales 1,55,000
Debtors 50,000 Creditors 10,000
Building 60,000 Return outwards 6,700
Salary 7,000
Opening stock 45,000
Gas and Fuel 2,700
3,53,500 3,53,500
Adjustments:
a) Provision for Bad debts is to be created @ 10% on Debtors
b) Interest on capital @ 8% p.a.
c) commission is due to be received Rs 40,000.
d) Closing stock Rs 50,000.