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Chapter 10 Accountancy Class 11 Important Questions. myCBSEguide has just released Chapter Wise Question Answers for class 11. Accountancy is the process of communicating financial information about a business entity to users such as shareholders and managers. Accountancy describes the duties of an accountant, the person whose job is to keep, inspect and interpret financial accounts. There chapter wise Practice Questions with complete solutions are available for download in myCBSEguide website and mobile app. These Question with solution are prepared by our team of expert teachers who are teaching grade in CBSE schools for years. There are around 4-5 set of solved Accountancy Extra questions from each and every chapter. The students will not miss any concept in these Chapter wise question that are specially designed to tackle Exam. We have taken care of every single concept given in CBSE Class 11 Accountancy syllabus and questions are framed as per the latest marking scheme and blue print issued by CBSE for class 11.
Class 11 Accountancy Extra Questions
Financial Statements -II Adjustments Class 11 Accountancy Extra Questions
Ch-10 Financial Statements-II Adjustments
- On which side of the balance sheet are prepaid expenses shown?
- Following information is given in trial balance
Bad debt Rs 3,000 Provision for bad debts Rs 3,500 Debtors Rs 40,000
It is desired to make a provision for doubtful debts @ of 10% on debtors. The amount debited to profit and loss account is.
- Is provision for discount on debtors made before making provision for doubtful debts?
- While Preparing final accounts, what treatment is made of prepaid expenses?
Extract of Trial Balance
as on 31st March, 2013
Name of Accounts Debit Balance(Rs) Credit Balance(Rs) Wages Paid 66,000 Salary Paid 16,500
Wages Rs 6,000 and salary Rs 1,500 are outstanding.
Pass an adjusting entry and show how will this appear in final accounts.
- Why is it necessary to record the adjusting entries in the preparation of final accounts?
Extract of Trial Balance
as on 31st March, 2013
Name of Accounts Debit Balance(Rs) Credit Balance(Rs) Bad Debts 1,600 Provision for doubtful Debts(1st April, 2012) 5,000 Debtors 1,60,000
Create a provision for doubtful debts @ 5% on debtors.
Pass necessary adjustment entries and show how will it appear in the financial statements of company.
- From the following balances obtained from the accounts of Mr. Ranjeet, Prepare the Trading and Profit & Loss Account:
Particulars Rs. Particulars Rs. Stock on April 01, 2012 8,000 Bad debts 1,200 Purchases for the year 22,000 Rent 1,200 Sales for the year 42,000 Discount (Dr.) 600 Wages 2,500 Commission paid 1,100 Salaries & Wages 3,500 Sales Expenses 600 Advertisement 1,000 Repairs 600
Closing stock on March 31, 2013, is Rs. 4,500.
- From the following balances, prepare the final accounts of M/s Mangal & Sons for the year ended 31st March 2018 :
Rs. Opening Stock 12,500 B/R 2,000 Sales 70,000 Purchases 37,500 Creditors 20,000 Salaries 3,850 Insurance 200 Debtors 32,500 Carriage 1,450 Commission 750 Interest 900 Printing 250 B/P 3,150 Returns in 1,300 Returns out 500 Bank 5,250 Rent and Taxes 1,300 Furniture 1,000 Capital 7,100
Closing Stock on 31-3-2018 Rs.15,000
- Suresh started buisness on 1st April, 2013 with a capital of Rs 30,000. The following trial balance was drawn up from his books at the end of the year.
Name of Accounts Amt(Rs) Name of Accounts Amt(Rs) Drawings 4,500 Capital 40,000 Plant and fixtures 8,000 Sales 1,60,000 Purchases 1,16,000 Creditors 12,000 Carriage inward 2,000 Bills payable 9,000 Wages 8,000 Return inward 4,000 Salaries 10,000 Printing 800 Advertisement 1,200 Trade Charges 600 Rent 1,400 Debtors 25,000 Bills Receivable 5,000 Investments 15,000 Discount 500 Cash at bank 16,000 Cash in hand 3,000 2,21,000 2,21,000
The value of stock as at 31st March, 2014 was Rs 26,000. You are required to prepare his trading and profit and loss account for the year ended 31st March, 2014 and a balance sheet as on the date after taking the following facts into account.
- Interest on capital is to be provided at 6% per annum.
- An additional capital of Rs 10,000 was introduced by Suresh on 1st October, 2013.
- Plant and fixtures are to be depreciated by 10% per annum.
- Salaries outstanding on 31st March, 2014 amounted to Rs 500.
- Accrued interest on investment amounted to Rs 750.
- Rs 500 are bad debts and provision for doubtful debts is to be created at 5% on the balance of debtors.
Ch-10 Financial Statements-II Adjustments
- Prepaid expenses are shown on Assets side of balance sheet.
- Statement showing showing provision for doubtful debts
Particulars Amount Bad Debts 3,000 (+) New Provision @ 10 % 4,000 7,000 (-) Old Provision (3,500) 3,500
- No, it is made after the provision for doubtful debts
- Prepaid Expenses are deducted in Profit and Loss account and shown as Assets in Balance Sheet. When prepaid expenses are given in trial balance, it is to be debited in P&L A/c only.
Dr Cr Date Particulars Debit Credit 31/03/2013 (i) Wages A/c Dr 6,000 To Outstanding Wages A/c
(Being wages due)
6,000 (ii) Salary A/c Dr 1,500 To Oustanding Salary A/c
(Being salary due)
Effects on Final Account
Dr Cr Date Particulars Amt(Rs) Date Particulars Amt(Rs) 31/03/2013 To Wages A/c 66,000 31/03/2013 (+)Outstanding Wages 6,000 72,000
Profit and Loss A/c
Dr Cr Date Particulars Amt(Rs) Date Particulars Amt(Rs) 31/03/2013 To Salary A/c 16,500 (+)Outstanding Salary 1,500 18,000
Liabilities Amt(Rs) Assets Amt(Rs) Outstanding Wages 6,000 Outstanding salary 1,500
- Before financial statements are prepared, additional journal entries, called adjusting entries, are made to ensure that the company’s financial records adhere to the revenue recognition and matching principles. Adjusting entries are necessary because a single transaction may affect revenues or expenses in more than one accounting period and also because all transactions have not necessarily been documented during the period.The following are the objectives of making adjustments ;
- To show the assets and liabilities at their actual value.
- to overcome the limitations of trial balance
- Providing for depreciation and reserves to arrive at net profit. the purpose is to make provision for wear and tear of fixed asset and reserves for unforeseen losses which might accrue.
- to account for all incomes pertaining to current year. The purpose is to adjust the accrued and unaccrued incomes.
- to account for all expenses pertaining to current year. the purpose is to adjust the outstanding and prepaid expenses so that p/l a/c show actual position.
- The following entries will be passed for recording the provision for doubtful debts :
Date Particulars LF Dr.(₹) Cr.(₹) Mar 31 Provision for Doubtful Debts A/c Dr. 1,600 To Bad Debts A/c
(Being bad debts transferred to old provision)
1,600 Mar 31 Profit and Loss A/c Dr. 4,600 To Provision for Doubtful Debts A/c
(Being creation of provision at 5% on debtors)
The Provision for doubtful debts will be recorded in financial statements in the following manner:
Extract of Profit and Loss Account
for the year ended 31st March, 2013
Dr Cr Particulars Amt(₹) Particulars Amt(₹) To Provision for Doubtful Debts A/c : Bad Debts 1,600 Add : New Provision on Rs 1,60,000 @ 5% 8,000 9,600 Less : Old Provision (5,000) 4,600
as at 31st March, 2013
Liabilities Amt(₹) Assets Amt(₹) Debtors 1,60,000 Less :New Provision
(@5% on ₹1,60,000)
Particulars Rs. Particulars Rs. To Opening stock 8,000 by Sales 42,000 To Purchases 22,000 by Closing stock 4,500 To Wages 2,500 To gross profit c/d 14000 46,500 46,500
Profit and loss A/c
Particulars Rs. Particulars Rs. To Salaries and Wages 3,500 By gross profit b/d 14,000 To Rent 1,200 To Advertisement 1,000 To Commission 1,100 To Discount 600 To Bad debts 1,200 To Sales Expenses 600 To Repairs 600 To Net Profit (transferred to capital) 4,200 14,000 14,000
TRADING AND PROFIT AND LOSS ACCOUNT
(for the year ended 31st March, 2018)
Particulars Rs. Particulars Rs. To Opening Stock 12,500 By Sales 70,000 To Purchases 37,500 Less : Sale Return 1,300 68,700 Less : Purchase Return 500 37,000 By Closing Stock 15,000 To Carriage 1,450 To Gross Profit 32,750 83,700 83,700 To Insurance Premium 200 By Gross Profit 32,750 To Salaries 3,850 To Interest Paid 900 To Printing 250 To Rent 1,300 To Commission 750 To Net Profit 25,500 32,750 32,750
(AS AT 31-03-2018)
Liabilities Rs. Assets Rs. Capital 7,100 Bank 5,250 Add : Net Profit 25,500 32,600 Bills Receivables 2,000 Bills Payables 3,150 Debtors 32,500 Creditors 20,000 Stock 15,000 Furniture 1,000 55,750 55,750
Trading and Profit and loss Account
for the year ended 31st March, 2014
Dr Cr Particulars Amt(Rs) Particulars Amt(Rs) To Purchases 1,16,000 By Sales 1,60,000 To Wages 8,000 Less : Returns Inward (4,000) 1,56,000 To Carriage Inward 2,000 By Closing Stock 26,000 To Gross Profit transferred to Profit & Loss A/c 56,000 1,82,000 1,82,000 To Salaries 10,000 By Gross Profit transferred from trading A/c 56,000 Add : Outstanding Salaries 500 10,500 By Accrued Interest on Investment 750 To Printing 800 To Advertisement 1,200 To Trade Charges 600 To Rent 1,400 To Interest on Capital(W.N)(1,200 + 900) 2,100 To Depreciation on plant & fixtures 800 To Bad Debts 500 Add : New Provision 1,225 1,725 To Net Profit Transferred to Capital A/c 37,125 56,750 56,750
as at 31st March,2014
Liabilities Amt(Rs) Assets Amt(Rs) Bills Payable 9,000 Cash in hand 3,000 Creditors 12,000 Cash at bank 16,000 Salaries Outstanding 500 Bills Receivable 5,000 Capital(30,000 + 10,000) 40,000 Debtors 25,000 Add :Interest on Capital 2,100 Less : Bad Debts ( 500) Profit transferred from Profit & Loss A/c 37,125 24,500 79,225 Less :Provision for Bad Debts(5% on ₹ 24,500) ( 1,225) 23,375 (-)Drawings ( 4,500) 74,725 Closing Stock 26,000 Investments 15,000 (+)Accrued Interest 750 15,750 Plants and fixtures 8,000 (-)Depreciation ( 800) 7,200 96,225 96,225
Calculation of Interest on Capital:
On ₹ 30,000 @ 6% p.a. for 6 months ( from April to September) = ₹900
On ₹40,000 @ 6% p.a. for 6 months ( from October to March ) = ₹1,200
Total interest = 1200+900=₹2100
Class 11 Accountancy Chapter Wise Important Question
- Introduction to accounting
- Theory Base of Accounting
- Recording of Transactions -I Vouchers, Journals & Ledgers
- Recording of Transactions -II Cash Books & other Books
- Bank Reconciliation Statement
- Depreciation Provisions and Reserves
- Bill of Exchange
- Trial Balance and Rectification of Errors
- Financial Statements -I Sole Proprietorship
- Financial Statements -II Adjustments
- Accounts from Incomplete Records
- Computers in Accounting
- Computerised Accounting System