Important model question for Account-II Class 12. Model question of Account
management important note

Model Question Set


Subject: Account II | Class: 12 | F.M.: 100 | P.M.: 35 | Time: 3hrs

Candidates are required to give answers in their own words as far as practicable. The figures in the margin indicate full marks.

Attempt all questions.

  1. Write any two characteristics of a company. [2]
  2. Point out any three difference between equity shares and preference shares. [3]
  3. What do you understand by Financial Statement Analysis? [3]
  4. Mention any two objectives of funds flow analysis. [2]
  5. Name and define any two types of costing. [3]
  6. Differentiate between direct and indirect cost. [2]
  7. Give the specimen of purchase requisition form. [2]
  8. What do you understand by allocation, appointment and absorption of overhead? Write in brief.
  9. A Company forfeited 200 shares of Rs. 100 each of shareholder for non-payment of final call money of Rs. 30 per share. These shares were reissued at Rs. 60 per share as fully paid.

Required: Journal entries for: (a) Forfeiture (b) Reissue (c) Transfer

  1. A Company limited invited applications for 1,000 shares of Rs. 100 each at a premium of Rs. 20 per share payable as under: [6]

On application Rs. 30

On allotment (including premium) Rs. 50

On first and final call Rs. 40

The public applied for 1,500 shares. Applications for 300 shares were rejected and allotment of excess application money in part payment of allotment. One shareholder, holding 20 shares, failed to pay the money due on allotment and the call. His shares were forfeit.

Required: Journal entries for:

i. Share allotment

ii. Share first and final call

iii. His shares were forfeiture

  1. R.Co. Ltd.took over the following assets and liabilities of S. Co. Ltd. at on agreed purchase price of Rs. 69,000. [3]
Sundry debtors 60,000 Stock in trade 76,000
Machinery 1,00,000 Cash and bank 5,000
Sundry creditors 40,000 Outstanding expenses 15,000

The company issued fully paid equity shares of Rs. 100 each at Rs. 115 per share for the payment of purchase consideration amount.

Required: Journal entries.

  1. X. Co. Ltd. issued 200, 10% debentures of Rs. 100 each at a discount of 10% and redeemable at the end of 5 years at a premium of 5%. The debentures were redeemed after 5 years.

Required: Journal entries for issue and redemption of debentures. [4]

  1. The Trail Balance of a company as on 31st Chaitra, last year is given below. [15]
Particulars Debit (Rs.) Credit (Rs.)
Building 90,000
Machinery 66,000
Land 1,07,000
Creditors 68,000
Advance rent 12,000
Share capital 80,000
Cash at bank 40,000
Debtors 14,000
Prepaid insurance 6,000
General reserve 44,000
Revenue 3,22,000
Wages 1,10,000
Salaries 20,000
Sundry expenses 40,000
Interest 9,000
Insurance 24,000
Total 5,26,000 5,26,000

Additional Information:

i. Outstanding wages Rs. 10,000

ii. Outstanding interest Rs. 1,000

iii. Depreciation on Building and Machinery 10%

iv. Insurance premium Rs. 4,000 advance paid

Required: Ten-column worksheet.

  1. Prepare Income statement and balance Sheet as on 31st Chaitra, last year from the Ten-column work sheet of questions No. 13. [5]
  2. The Balance Sheet of A.K. Co. Ltd. as on 31st Chaitra, 2062 is as under: [5]
Liabilities Rs. Assets Rs.
Share capital 2,00,000 Fixed assets 2,00,000
Retained earning 1,50,000 Investment 1,23,000
10% Debentures 70,000 Sundry debtors 1,00,000
Sundry debtors 30,000 Inventory 50,000
Overdraft 20,000 Preliminary expenses 7,000
Outstanding expenses 10,000
Total 4,80,000 Total 4,80,000

Additional Information:

i. Fixed assets turnover ratio 3

ii. Gross profit Rs. 60,000


a. Sales amount

b. Current ratio

c. Quick ratio

d. Debt-equity ratio

e. Gross profit ratio

16. The opening and closing balance of different accounts are as under. [5]

Particulars Openings Balance (Rs.) Closing Balance (Rs.)
Sundry debtors 30,000 50,000
Inventories 1,00,000 1,10,000
Cash at bank 11,000 18,000
Sundry creditors 71,000 94,000
Outstanding expenses 7,500 5,500
Fixed assets 1,40,000 1,88,000
10% Debentures 75,000 50,000
Share capital 1,53,000 2,04,000

Additional Information: Funds from operation was Rs. 38,500


i. Schedule of changes in working capital.

ii. Funds flow statement.

17. Following are the Balance Sheets of a company as on 31st Chaitra: [10]

Liabilities 1st Year 2nd Year Assets 1st Year 2nd Year
Share capital 2,40,000 3,30,000 Plant and machinery 2,10,000 3,00,000
Share premium 33,000 Land and building 1,41,000 3,81,000
Reserve and suppliers 1,95,000 2,01,600 Long term investment 66,000 42,000
Long term liabilities 1,50,000 3,00,000 inventories 42,000 57,000
Accumulated Dep 90,000 1,65,000 Sundry debtors 75,000 87,000
Sundry creditors 45,000 60,000 Cash and bank 2,01,000 2,52,600
Bills payable 15,000 30,000
7,35,000 11,19,600   7,35,000 11,19,600

Income for the second year is as follows:

Particulars Rs. Rs.
Sales 3,60,000
Cost of goods sold 2,02,200
Less: Depreciation on plant 30,000 1,57,800
Depreciation on building 48,000 1,57,800
Operating expenses 60,000 19,000
Net income from operation 7,200
Gain on sale of investment 27,000
Less Loss on sale of machinery (Proceeds were Rs. 9,000) 3,000
Net Income 24,000
Less Dividend paid 17,400
Retained earning 6,600

Additional Information:

i. Investment costing Rs. 24,000 was sold for Rs. 31,200

ii. The plant purchase for Rs. 1,05,000

Required: Cash flow statement using direct method.

18. The details form materials purchase of a firm are:

Annual requirement 4,000 units, cost per order Rs. 400, Cost per unit Rs. 200, Inventory carrying cost 10% of inventory value. [2]

a. Economic order quantity

b. No. of orders per year

19. The following are the details of receipts and issues of materials during Ashadh:

1 Opening stock 400 units @ Rs. 5 each

3 Purchase 1600 units @ Rs. each

5 Issued 1000 units

10 Returned to vendors 100 units purchased on 3rd Ashadh

12 Returned from a work order 20 units

15 Issued 500 units

16 Purchased 1000 units @ Rs. 5.50 each

20 Stock verification surplus 10 units

25 Issued 500 units

Required: Store ledger under LIFO method.

20. The following particulars are given:

Wage material Rs. 20 per hour
Normal time 30 minutes per unit
Production per worker: Ram 15 units
Shyam 20 units

Required: Earning of Ram and Shyam by using Piece Rate System.

21. The beginning and ending balance of a manufacturing company for a month are as under:

Particulars Beginning Ending
Raw material Rs. 12,000 Rs. 10,000
Work-in-progress 6,000 8,000
Finished goods 500 units 10,000

The information available from cost records for the month ended was as follows:

Direct materials purchased Rs. 1,20,000
Indirect labour 18,000
Direct labour 32,000
Freight on materials purchased 6,000
Other factory expenses 30,000
Indirect materials 34,000
Selling and distribution overhead 10,000
Production units 16,000 units
Sales units 15,000 units
Profit 10% on cost

Required: Cost sheet showing:

  • Cost of raw material consumed
  • Prime cost
  • Factory cost
  • Cost of production
  • Cost of goods sold
  • Cost of sales
  • Sales value

22. The net profit shown by financial accounts of a company amounted to Rs. 2,00,000. On reconciliation, the following facts brought to light:

i. The director’s fees amounted to Rs. 6,000 and income tax Rs. 80,000 were included in the financial account but not in cost account.

ii. Under recovery of factory overheads in cost account was Ts. 20,000.

iii. Depreciation in financial account recorded Rs. 22,000 but it was Rs. 20,000 in cost account.

iv. Bank interest and dividend credited to financial account Rs. 10,000.

Required: Reconciliation Statement of Cost and Financial Account.

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