List of top Accountancy Questions

The following information was obtained from the books of PQR Ltd.: Profit and Loss balance (Dr.) as at 31st March, 2024: Rs 30,000; Profit and Loss balance (Cr.) as at 31st March, 2025: Rs 56,000; Interim Dividend paid during the year: Rs 36,000. The net profit before taxation for the year ended 31st March, 2025 will be:

The following information was obtained about the cash flows of XYZ Ltd. for the year ended 31st March, 2025: Cash inflows from operating activities Rs 28,000; cash used in investing activities Rs 32,000 and cash inflows from financing activities Rs 5,000. If the opening balance of cash and cash equivalents on 1st April, 2024 was Rs 25,000, the closing balance of cash and cash equivalents on 31st March, 2025 will be:

Arhan and Kanak were partners in a firm sharing profits and losses in the ratio of 3:2. Their Balance Sheet as at 31st March, 2025 was as follows:

The firm was dissolved on the above date and the following transactions took place:

(i) 50% of the creditors were given stock in full settlement of their dues. Remaining creditors were settled at 20% discount.

(ii) Investments were taken over by Kanak at Rs 8,40,000.

(iii) Debtors realized Rs 8,50,000 and machinery was sold at 70% of book value.

(iv) Realisation expenses amounted to Rs 1,20,000 which were paid by Arhan.

Prepare Realisation Account.

Statement I: Quick Credit Ltd., a finance company, paid interest on borrowings amounting to Rs 80,000. This will be shown as cash outflow from operating activities in its Cash Flow Statement.

Statement II: Royal Foods Ltd., a non-financial enterprise, paid dividends amounting to Rs 2,30,000. It will be shown as cash outflow from operating activities in its Cash Flow Statement.

Choose the correct option from the following:

Orion Enterprises Ltd. invited applications for issue of 70,000 equity shares of Rs 10 each at a premium of Rs 1 per share. The amount was payable as follows:

On Application - Rs 4 per share (including premium Rs 1 per share)

On Allotment - Rs 6 per share

On First and final call - Balance

Applications were received for 2,00,000 shares. Allotment was made as under:

Category A: Applicants for 1,20,000 shares were allotted 60,000 shares.

Category B: Applicants for 80,000 shares were allotted 10,000 shares.

Excess money received with applications was adjusted towards sums due on allotment only. Meeta, from category A, who was allotted 500 shares, failed to pay allotment money and first and final call and Japna, from category B, who had applied for 1,600 shares, failed to pay the first and final call money.

Pass necessary journal entries in the books of Orion Enterprises Ltd. for the above transactions.

Astha Ltd. invited applications for issuing 1,00,000 equity shares of Rs 10 each. The amount per share was payable as follows: Rs 2 on application; Rs 3 on allotment; Rs 3 on first call and Rs 2 on second and final call. Applications were received for 1,50,000 shares. Applications for 30,000 shares were rejected and application money refunded. The shares were allotted on pro-rata basis to the applicants of 1,20,000 shares. Excess money received with applications was adjusted towards sums due on allotment. All shareholders paid the allotment money except Sarthak, who was allotted 2,000 shares. These shares were forfeited. The first call was made thereafter and duly received. The second and final call was not yet made. Pass necessary journal entries for the above transactions in the books of Astha Ltd. Open Calls-in-Arrears Account, wherever required.

Arjun and Kavya were partners in a firm sharing profits and losses in the ratio of 3:2. Their Balance Sheet as at 31st March, 2025 was as follows:

On 1st April, 2025, Raghav was admitted as a new partner for 1/4th share in the profits of the firm on the following terms:

(i) Raghav shall bring Rs 5,00,000 as his capital.

(ii) Goodwill of the firm was valued at Rs 4,00,000. Raghav was unable to bring his share of goodwill premium in cash.

(iii) Provision for doubtful debts was to be created @ 10% on debtors.

(iv) Investments were valued at Rs 2,00,000 and building was to be brought down to Rs 5,00,000.

(v) Capitals of Arjun and Kavya were to be adjusted on the basis of Raghav's capital in the business. Actual cash was to be paid off or brought in by the old partners as the case may be.

Prepare Revaluation Account and Partners' Capital Accounts.

Aarav, Kunal and Manav were partners in a firm sharing profits and losses in the ratio of 5:3:2. Their Balance Sheet as at 31st March, 2025 was as follows:

Aarav retired on the above date and it was agreed that:

(i) Kunal and Manav will share future profits in the ratio of 1:4.

(ii) Goodwill of the firm be valued at Rs 6,00,000 and the retiring partner's share would be adjusted through the capital accounts of the remaining partners.

(iii) An unrecorded creditor of Rs 20,000 was to be taken into account.

(iv) Debtors of Rs 15,000 were to be written off as bad debts.

(v) Liability on account of workmen compensation amounted to Rs 40,000.

(vi) Amount payable to Aarav was transferred to his loan account.

Pass necessary journal entries for the above transactions in the books of the firm on Aarav's retirement.

Anmol, Kapeesh and Meera were partners in a firm sharing profits and losses in the ratio of 4:3:3. The firm closes its books on 31st March every year. On 1st July, 2025, Kapeesh died. On that date his capital account showed a credit balance of Rs 2,50,000 and he had withdrawn Rs 20,000 till that date for personal use. On the date of Kapeesh's death, the firm had a General Reserve of Rs 90,000. The partnership deed provided that on the death of a partner, his executors will be entitled to the following:

(i) Balance in the capital account and interest on the same @ 12% p.a.

(ii) His share in the goodwill of the firm. The goodwill of the firm on Kapeesh's death was valued at Rs 1,40,000.

(iii) His share in the profits of the firm was to be calculated on the basis of previous year's profit. The profit of the firm for the year ended 31st March, 2025 was Rs 6,00,000.

Prepare Kapeesh's Capital Account to be presented to his executors.

On 1st April, 2024, Smaran Ltd. issued 60,000, 11% Debentures of Rs 100 each at a premium of 10%, redeemable at par after five years. The company closed its books on 31st March every year. Pass necessary journal entries in the books of the company for issue of debentures, payment of interest on debentures and writing off interest for the year ended 31st March, 2025.

Century Ltd. forfeited 5,000 shares of Rs 100 each issued at 40% premium for non-payment of allotment money of Rs 35 per share and first call of Rs 50 per share (including premium Rs 25). The second and final call of Rs 40 per share (including premium Rs 15) has not yet been called. Out of these, 3,000 shares were reissued as fully paid-up for Rs 90 per share. Pass necessary journal entries for forfeiture and reissue of forfeited shares in the books of Century Ltd.

Almond Ltd. purchased a running business of Cashew Ltd. comprising of land and building Rs 85,00,000, machinery Rs 50,00,000 and sundry liabilities Rs 10,00,000 for a purchase consideration of Rs 1,00,00,000. Payment of Rs 10,00,000 was made through a cheque and the remaining amount by issue of 11% Debentures of Rs 100 each at a premium of 20%. Pass necessary journal entries for the above transactions in the books of Almond Ltd.

Rohit, Ashish and Sameer entered into a partnership on 1st October, 2024 with capitals of Rs 12,00,000; Rs 6,00,000 and Rs 6,00,000 respectively. They decided to share the profits and losses in the ratio of 3:1:1. Partners were entitled to interest on capital @ 5% per annum as per the provisions of the partnership deed. Sameer was given a guarantee that his share of profit, after charging interest on capital, will not be less than Rs 1,50,000 per annum. Any deficiency arising on that account shall be met by Rohit. The profit for the year ended 31st March, 2025 amounted to Rs 5,60,000. Prepare Profit and Loss Appropriation Account for the year ended 31st March, 2025.

Tara, Dev and Ishaan were partners in a firm sharing profits and losses in the ratio of 4:3:1. The partnership deed provided for charging interest on drawings @ 10% p.a. The drawings of Tara, Dev and Ishaan during the year ending 31st March, 2025 amounted to Rs 30,000; Rs 18,000 and Rs 12,000 respectively. After the final accounts were prepared, it was discovered that interest on drawings was not taken into consideration. Give necessary adjusting journal entry to correct the omission. Show your workings clearly.

Sanjana and Mehul were partners in a firm sharing profits and losses in the ratio of 4:1. From 1st April, 2025, they decided to share future profits and losses in the ratio of 5:3. On this date, their balance sheet showed a balance of Rs 40,000 in General Reserve Account and a debit balance of Rs 1,80,000 in the Profit and Loss Account. The partners decided to distribute the General Reserve, but decided not to disturb the Profit and Loss Account, which will continue in the books of the reconstituted firm. Pass necessary journal entries for the above transactions on the reconstitution of the firm. Show your workings clearly.

Anita and Priyal were partners in a firm sharing profits and losses in the ratio of 3:2. On 1st April, 2024, their capital accounts showed balances of Rs 3,00,000 and Rs 4,00,000 respectively. The partnership deed provided for interest on capital @ 8% p.a. The firm earned a profit of Rs 28,000 for the year ended 31st March, 2025. Interest on capital allowed to Anita and Priyal was:

Aarav, Karan and Meera were partners in a firm sharing profits and losses equally. On 31st March, 2023, Karan retired. On the date of his retirement, Rs 1,80,000 became due to him. Aarav and Meera agreed to pay Karan in two equal yearly instalments plus interest @ 12% p.a. on unpaid balance, starting from 31st March, 2024. The firm closes its books on 31st March every year. Prepare Karan's loan account till it is fully paid.

Assertion (A): Goodwill is an intangible asset.

Reason (R): Goodwill is the value of the reputation of a firm in respect of profits expected in future over and above the normal profits.

Choose the correct option from the following:

White Ltd. purchased Plant and Machinery worth Rs 3,96,000 from Nath Ltd. The purchase consideration was paid by issue of 9% Debentures of Rs 100 each at 10% discount. The number of debentures issued were:

A portion of the uncalled capital reserved by a company to be called only in the event of winding up of the company is called:

Dinesh, Siddharth and Naina were partners in a firm sharing profits and losses in the ratio of 5:3:2. On 31st March, 2025, they decided to dissolve the firm. On this date, the firm had debtors amounting to Rs 2,10,000 and provision for doubtful debts of Rs 20,000. On dissolution, debtors of Rs 10,000 proved bad and the remaining debtors realised 90%. Amount realised from debtors will be:

Amik Ltd. issued 70,000, 9% Debentures of Rs 100 each at a premium of 5%, redeemable at a premium of 10%. 'Loss on Issue of Debentures Account' will be debited in the books of Amik Ltd. by:

A business earned an average profit of Rs 2,00,000 during the last few years. The value of net assets of the business is Rs 17,00,000 and the normal rate of return in a similar business is 10%. The value of goodwill of the business by capitalisation of super-profits method will be:

Asha, Manan and Niyati were partners in a firm sharing profits and losses in the ratio of 3:2:1. With effect from 1st April, 2025, they agreed to share profits and losses equally. Due to change in the profit sharing ratio, Asha's gain or sacrifice will be:

As per the provisions of Companies Act, 2013, the amount received as Securities Premium cannot be utilised to: