FIRST TERM EXAMINATION – OCT.

2022
SUBJECT – ACCOUNTANCY (055)
ANSWER KEY

CLASS: XI MAX. MARKS: 80

1. c. transactions between business and its owners are recorded from business point of
View 1

2. d. Credit Balance of bank 1

3. b. is not shown separately in the books of account. 1

4. a. Investment 1

5. c. an asset 1

6. a. Deferred Revenue Expenditure 1

7. a. revenue receipt 1

8. d. Purchased a LED Television for personal use. 1

9. b. Debit of Cash Column and Credit of Bank Column 1

10. d. All of the above 1

11. a. Replacement of Memory 1

12. a. Assertion (A) and Reason (R) are correct but R is not the correct explanation of
A. 1

13. c. all transactions and events which can be measured in money terms are recorded
in the books of account. 1

14. b. Both Assertion (A) and Reason (R) are correct and R is the correct explanation of
A 1

15. c. all prospective losses but leaves out prospective profits 1

16. b. Bad Debts Recovered A/c 1

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17. c. Communication of information 1

18. c. Rs. 2,40,000 1

19. d. Installation charges 1

20.b. Drawings A/c 1

21. International Financial Reporting Standards (IFRS)

IFRS are the accounting standard issued by the IASB recommended to be used by
the enterprise globally to produce financial statements following a single set of
accounting standards. IFRS are principle based accounting standards in
comparison to rule based Indian accounting Standards. Also the are based on fair
value concept.
Indian Accounting Standard (IND AS)
Ind-AS are the accounting standards issued by the ministry of corporate affairs,
government of India, and notified under the companies act, 2013 prescribed to be
used by the enterprises to prepare financial statements. They are principle based
accounting standards in comparison to rule based accounting standards. Also they
are based on fair value concept. 3

22. Accounting Vouchers are written documents containing an analysis of business

transactions for accounting and recording purpose.
Different types of Accounting Vouchers are:
a. Cash Vouchers: They are prepared at the time of payment and receipt of cash
i. Credit Voucher- Prepared when cash is received.
ii. Debit Voucher – Prepared when payment is made
b. Non-Cash or Transfer Vouchers: They are prepared for transactions not involving cash.
3

23.
Cash Book
Dr. Cr.
Date Particulars L.F. Rs. Date Particulars L.F. Rs.
2021 2021
Dec. 1 To Capital A/c 20,000 Dec. 2 By Purchase A/c 5,000
5 To Sales A/c 12,000 13 By Ravi A/c 7,000
26 To Commission A/c 980 18 By Furniture A/c 6,000
24 By Rent A/c 400
28 By Drawings A/c 1,000
31 By Salary A/c 1,900
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 31 By Balance c/d 11,680

32,980 32,980
2022
Jan 1 To Balance b/d 11,680
3

24. External Users of Accounting Information are:

a. Banks and Financial Institutions: Banks and Financial Institutions are
essential part of any business as they provide loans. They watch the
performance of business to know whether it is making a progress as projected
to ensure the safety and recovery of the loan and payment of interest.
b. Investors and potential Investors: They rely on the accounting information to
know what is the earning capacity of the enterprise and how safe is their
investments.
c. Creditors: Creditors are those party who supply goods or services on credit.
Before granting credit, creditors satisfy themselves about the creditworthiness
of the business. 3

25. The qualitative characteristics of accounting information are:

a. Reliability: Accounting information must be reliable. Reliability of
information means it is verifiable, free from bias and material error.
b. Relevance: Accounting information must be relevant to the user. Information
is relevant if it meets the needs of the users in decision making.
c. Understandability: Understandability means that the information provided
through the financial statements must be presented in a manner that the users
are able to understand it.
d. Comparability: Comparability means that the users should be able to compare
the accounting information of an enterprise of the period either with that of the
other periods, known as intra firms comparison or with the accounting
information of the other enterprise, known as inter firm comparison. 3

26. The objectives of GST are:

a. Developing Common National Market by having One Indirect Tax
GST is a step towards development of Common National Market by levy of one
Indirect Tax and thus facilitate free flow of goods and services across.
b. Decrease in Cost of Goods by Removing Cascading Effect of Indirect Taxes
Cascading effect is removed due GST.
c. Ease in Doing Business
GST is a comprehensive indirect tax meaning that almost all the indirect taxes are
merged into it. 3
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27. a. Business Entity Concept - The concept assumes that business is an entity
distinct and separate from its owner. All business transactions are recorded in
the books of the business from the point of view of the business and not from
the point of view of the proprietor. Even the proprietor is treated as a liability
to the extent of his capital.

b. Matching Concept - According to this concept the expenses incurred in any

accounting year should be matched with the revenue recognised in that
period, so as to give true view of the profitability of an organisation. The
Matching Principle is applied by determining the revenue and related
expenses to the accounting period.

c. Consistency Concept - According to this concept the basis of preparing

accounts should be consistent and should not be altered over a short period of
time. In other words, to compare the results of a business unit for different
period, it is necessary that the policies and procedures adopted in one year are
followed year after year.

d. Historical Cost Concept - According to this concept all assets are recorded at a
price paid at the time of their purchase. Any change in the value of those assets
due to change in the price level is not considered or recorded. This is called
Historical Cost.
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28.
Peter A/c
Dr. Cr.
Date Particulars L.F. Rs. Date Particulars L.F. Rs.
To Sales A/c 20,000 By Bank A/c 11,800
To Output CGST A/c 1,800
To Output SGST A/c 1,800 By Balance c/d 11,800

23,600 23,600

To Balance b/d 11,800

Output CGST A/c

Dr. Cr.
Date Particulars L.F. Rs. Date Particulars L.F. Rs.
To Balance c/d 1,800 By Peter A/c 1,800

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 1,800 1,800

By Balance c/d 1,800

. 4

29. Total Expenses Rs. 9,200

Petty Cash Balance Rs. 10,800 4

30. a. Debtor- Debtor is a person or entity who owes amount to the enterprise
against credit sales of goods or services rendered. Goods when sold to a
person on credit is called Debtor because he owes that much amount to the
enterprise.

b. Fictitious Assets - Fictitious Assets are those assets which are neither tangible
nor intangible assets. They are losses not written off in the year in which
they are incurred but in more than one accounting period.
e.g., Deferred Revenue Expenditure such as Advertisement Expenditure.

c. Liability - Liabilities means amount owed (payable) by the business. Liability

towards owner of the business is termed as internal liability and towards
outsider as external liability.

d. Drawings - It is the amount withdrawn or amount taken by the proprietor or

partner for personal use.

e. Sales - The term sales is associated with or used for sale of goods. These
goods maybe purchase for resale or manufactured by the enterprise. The term
sales includes both cash and credit sales of goods. Goods sold for cash are
termed as Cash Sales and goods sold on credit are termed as Credit Sales.

f. Capital Expenditure - Expenditure is the amount or liability incurred for

acquiring assets, goods or services. It is an expenditure incurred to acquire
assets or improving the existing assets which will increase the earning
capacity of the business. It may be incurred to acquire tangible or intangible
assets. E.g., Purchase of machinery to manufacture goods. 6

31.

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 Particulars Asset Liability +Capital
Cash Stock Debtors Salary Capital
Outstanding
a. Started business 1,20,000 1,20,000
b. Goods purchased (10,000) 10,000
c. Rent received 5,000 5,000
d. Salary outstanding 2,000 (2,000)
e. Goods sold (5,000) 7,000 2,000
f. Goods loss due to fire (500) (500)
1,15,000 4,500 7,000 2,000 1,24,500
Assets – Rs. 1,26,500 Liability + Capital Rs. 1,26,500
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32.
Sales Book
Date Particulars Invoice L. Details Sale Freight Packing Total
No. F. (Rs.) Value (Rs.) Charge (Rs.)
(Rs.) (Rs.)
2022
Mar.1 M/s. Gayatri Tea, Assam
3 chests of tea @ Rs. 2005 15,000
5000 each
Less : Trade Dist @5% 750 14,750 - - 14,750

4 M/s Mohan & Sons

20Kg Amul Butter @Rs. 2006 5000
250 Per kg
Less : Trade Dist @5% 250 4,750 - - 4,750
5 M/s Garry & Sons
20Kg Assam tea 2007 12000
@Rs.600 per kg
Less : Trade Dist @5% 600
11,400
Add: Freight Charges 1,000
Packing Charges 600
13,000 11,400 1,000 600 13,000
30,900 1,000 600 32,500

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33.
Journal
Date Particulars L.F. Debit Credit (Rs.)
(Rs.)
a. Accrued Interest A/c Dr. 4,000
To Interest A/c 4,000
(Being interest due but not received)

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 b. Depreciation A/c Dr. 500
To Furniture A/c 500
(Being depreciation charged @10%)

c. Cash A/c Dr. 6,000

Bad debt A/c Dr. 4,000
To Sohan A/c 10,000
(Being 60paise in a rupee received in full
settlement)

d. Mehar A/c Dr. 26,000

To Bank A/c 25,000
To Discount received A/c 1,000
(Being amount paid in full settlement)

e. Bank A/c Dr. 88,200

Discount AllowedA/c Dr. 1800
To Sales A/c 90,000
(Being goods sold and trade and cash
discount allowed)

f. Machinery A/c Dr. 50,000

Input IGST A/c Dr. 6,000
To New Machinery House A/c 56,000
(Being machinery purchased on credit plus
IGST @12%)
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34.

Dr. Cash Book Cr.

Date Particulars L. Cash Bank Date Particulars L. Cash Bank
F. (Rs.) (Rs.) F. (Rs.) (Rs.)
2021 2021
Jan1 To Balance b/d 5,000 17,500 Jan 5 By S. Bose A/c 12,500
5 To Capital A/c 5,000 9 By Wages A/c 3,000
6 To Advance A/c 50,000 12 By Bank A/c C 1,000
12 To Cash A/c C 1,000 21 By Cash A/c C 5,000
20 To Mukherjee A/c 6,000 29 By Drawings A/c 4,000
21 To Bank A/c C 5,000 30 By Rent A/c 1,000
30 To Sales A/c 8,000
By Balance c/d 2,000 69,000

10,000 87,500 10,000 87,500

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 To Balance b/d 2,000 69,000

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