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Financial Accounting (Unsolved Papers of ICMAP)

This document contains sample exam questions from the Institute of Cost and Management Accountants of Pakistan. It includes multiple choice and problem-solving questions covering various accounting topics. Specifically, it addresses: 1) The difference between current and fixed assets, and liquid and current assets. 2) Journal entries for purchases and payments. 3) Calculation of interest income and journal entries. 4) Bad debt allowance and write-offs. 5) Depreciation calculations for vehicles. 6) Payroll calculations including provident funds and loans. 7) Partnership formation and capital accounts. 8) Hire purchase ledger accounts.

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5K views

Financial Accounting (Unsolved Papers of ICMAP)

This document contains sample exam questions from the Institute of Cost and Management Accountants of Pakistan. It includes multiple choice and problem-solving questions covering various accounting topics. Specifically, it addresses: 1) The difference between current and fixed assets, and liquid and current assets. 2) Journal entries for purchases and payments. 3) Calculation of interest income and journal entries. 4) Bad debt allowance and write-offs. 5) Depreciation calculations for vehicles. 6) Payroll calculations including provident funds and loans. 7) Partnership formation and capital accounts. 8) Hire purchase ledger accounts.

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ZN
Copyright
© Attribution Non-Commercial (BY-NC)
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THE INSTITUTE OF COST AND MANAGEMENT ACCOUNTANTS OF PAKISTAN PART-I EXAMINATION - 1996 \l\CCOUNTING - I'APER I MAY, 1996

Q.1. Ca)

(b) (e)

In the accounts of MIs ABC Computer systems which deal in Computers. the computers are shown are shown as current assets whereas the Companies or Firms which "buy computers from them shown the same computer as fixed asset, Explain why is il 507 . What is the differences between liquid assets and current assets. Illustrate by example. Mis Javed Traders' credit sales record shows the following data for the month 01 Septem ber, 1995.
Bill date

Amount
RS .2.000 Rs . 5.850 Rs . 10.975

(i) (ii)
(iii)

4-9-1995 12-9-1995 24-9-1995

Tenns 2110 n/30 2110 ni30 2110 n/30

Buyers
Nadeem & Sons Nasirn & Company Iqbal & Co.

The bills were paid on 12995.21-9-95 and 23-9-95 respectively.

Required: (i) Journal entries for payment in the books of purchaser. (ii) Journal entries of receipt of payment in the books of seller.

MIs Haysi Corporation put their surplus funds amounting to Rs. 2 5 Millions in Short Notice Deposit wilh Sky High Bank LId. on 25-2-95 at a profit rale 13% per annum. The deposil was encashed on 2710-95. The bank deducts withholding Tax @ 10% at the lime of 'Tlaking payments of profits. ,.'

(d)

0'

Required: (i) Calculate the amount of the profit paid by Mis Hayal Corporalion. (ii) Journal entry for recording of prom by MIs Haysi Corporation.

f. Q.2.
(0)
V

Accounts receivable of Mis Shahid & Brolhers show a balance of Rs . 577 .850. :rhe

amount when scrutinised revealed as under.


Receivable over 2 years Receivable over 1 year bulless than 2 years' Receivable over 6 months bulless (han 1 year Balance is receivabla of less than 6 months.

Rs . 15,500 Rs .80.000 Rs. 165.000 .

The firm's policy is to write orr receivable over 2 years and to maintaJn a Bad Debt Allowance of 1% of the net sales of the year. The bad debt allowance account shows a credit balance of Rs. 20,500 and net sales for the year was Rs. 8.750.000.
ReqUired: (Q Journal enlry to record bad debt write off (ii) Journal enlry for recording Bad debl Allowance (iii) T account for Bad debt allowance racordinq the above transactions and show the balance . .
On August 17. 1995 MIs Venue Limited bought a new van having a market value of Rs. 600,000. They paid Rs. 500,000 cash and balance was settled by trade in of their okf van which was purchased in September 1992 for Rs . 450.000. The Company's policy for Depreciation was 10 charye deprecialion on motor vehicles al 20% on straighl line method having no residual value and 10 charge full year depreciaUon on assets under

- /54

use for more than 8 months. No depreciation Is charged for usage of less than 6 monlhs.
Calendar year Is Ihe aceounllng year for lhe company.

Required:
(I) (ii) (iii) Joumalise disposal of the old van.

Record purchase of new van.


Calculale depredallon 'or the new van for the year 1996. M/s Hamayun ltd. have 6 office executives on their regular payroll. Monthly data of their emolumenls Is tabulated as under:

o.a,

><

Name of Employee

Desgo.

Basic
9,000 8,000 6.000 5.000 5,000 5000 ,

'" 0

Mr. BadruddoJa G .M. Mr. Joseph D'Souza Acctt. Mr. Nizamuddin Chief Cashier Mrs. Gul Khan P.A. to Dlr. Mr. Merajuddln PA to G .M.

Mr. Fasihuuaman

co-ore.

Salary (Amounl in Rs.) House . Conveyance Renl 4.050 900 3,600 800 3,600 600 2.250 500 2,250 500 2,250 500

Gross

Salary 13,950 12,400 9.300 7,750 7,750 7,750

The company has a recognised provident fund . Both the employees and employer contribute to provident 'und @ 10% of basic salary each month. As per law Income Tax Is to be deducted lrom salal)' of these employees@ 10% of basic salary per monlh. The lollowing employees have taken loan lrom Ihe Company deductible lrom their salary In Instalments. Details are as under. .

Name of Employee

LoanAmouni (Amount in Rs.)


10,000 15,000 5,000

Monthly Deduclion
1,000 1,500 500

Loan Balance as aI311295

Mr. Joseph D'Souza Mr.; . Gul Khan

Mr. Fasihuuaman

5,000 9,000 500

Required: . (i) Prepare a payroll lorthe month 01 Janual)', 1996. (ii) Joumalise Ihe Payroll lor the month 01 January, 1996.

a.4.

Two friends Nazlr and Ramazan were running general stores' separately. In December, 1994 Nazl(s landlonl gave him a notice to vacate the shop. Ramazan was planning to expand his business so they agreed to merge Iheir businesses and take the assets and liabilmes of individuals at value shown thereunder as at January I, 1995.

Cash
Accounts Receivable
Merchandise Inventol)' Shop Fumilure Shop Premises Allowance for Depredation: - Shop Premises Shop Fumilure Accounts Payable

Nazlr Rs. 20,000 35,000 100,000 40,000

Ramazan
Rs. 15,000 45,000 85,000 60,000 150,000 60,000 45,000 65,000

.-

15.000 38,000

II was mutually agreed Ihat the Capilal 01 Nazir wquld be Rs. 150,000 and that 0' Ramazan Rs. 200,000. Any defidency in the capital would be paid in cash by the respeclive partners and paid 10 Ihe creditors. Profit sharing ratio for Ramazan and Nazir

155

......

~ ~ - - --,c---.....,

was agreed 70:30 and Ramazan was allowed Rs . 10,000 per year as shop re nt. They started partnership business from January 1, 1995 and reported operauonalnet profit of Rs . 170,000 before adjustments as per partnership agreement.

<

Requ ired: Q (i) Journal entries to record capit al and assets in the partn ership books of accounts.'
(ii) (iii)
Prepare a balance sheet of partnership firm as at January 1. 199 5 . Allocation of net profil adjustm ent to the partners. .;

Q.5.

SaJJad and Company sells household equipment's on hire-purc ha se al cosl plus 500/. marx-up. Relevant dala for the year is appended below: January I, 1995 Rs. Stock issued on hire-purchase basis 60,000 . hand al shop ' Stock In 7.500 Instalment due from customers 4.500
Calledians during the year

December 31 . 1995. Rs. ,. 69.000 . 10 ,500 7 ,500 120,000

Required: Prepare ledger accounts:


(i)
(iI) (iii)

Hire Purchase Debtors Shop Siock


H ire Purchase Stock

..

156

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