CBSE Sample Papers for Class 11 Accountancy Set 5 with Solutions

Students must start practicing the questions from CBSE Sample Papers for Class 11 Accountancy with Solutions Set 5 are designed as per the revised syllabus.

CBSE Sample Papers for Class 11 Accountancy Set 5 with Solutions

Time : 3 Hr.
Max. Marks : 80

General Instructions:

This question paper contains two parts, A and B.
All questions in both the parts are compulsory.
All parts of the questions should be attempted at one place.

Part-A (56 Marks)
Financial Accounting-I

Question 1.
Which of the following is not a type of impersonal accounts? [1]
(A) Real Account
(B) Nominal Account
(C) Representative Account
(D) All of these
Answer:
(C) Representative Account

Explanation: Impersonal accounts are classified into two types- real account and nominal account. Representative is a type of personal account.

Question 2.
……………. Book is used for recording return of goods purchased on credit. [1]
Answer:
Purchases Returns.

Explanation: Purchases returns or returns outward is one of the types of subsidiary books. It records all returns of goods purchased on credit.

Question 3.
Mr. X had made cash sales of ₹ 2,00,000 and credit sales of ₹ 3,00,000 for the year ended March 31,2018. He paid expenses of ₹ 50,000 and ₹ 30,000 are still outstanding for the current financial year. What is the profit or loss earned during the year under cash basis of accounting? [1]
Answer:
₹ 1,50,000 Profit.

Explanation: Under cash basis of accounting. Only transactions that involve cash are considered.

Question 4.
What are the written statements of uniform accounting rules and guidelines adopted while preparing financial statements called?
(A) Accounting standards
(B) IFRS
(C) AS and IFRS
(D) None of the above [l]
Answer:
(A) Accounting standards

Question 5.
Which of the following is an essential of an accounting voucher?
(A) Serial number of voucher
(B) Date of transaction
(C) Both (A) and (B)
(D) None of the above [1]
Answer:
(C) Both (A) and (B)

Question 6.
………………….., …………………, ……………… accounts are traditional categories of accounts. [1]
Answer:
Nominal, Personal, real

Explanation: As per traditional approach, accounts are into two types- personal and impersonal and impersonal is classified into two types – real and nominal.

Question 7.
………………….. is used to record expenses like postage, conveyance, stationery, etc. [1]
Answer:
Petty Cash Book.

Question 8.
Which of the following transactions will not become a part of Bank Reconciliation Statement?
(A) Direct deposit by Ram in bank ₹ 10,000
(B) Bank charges ₹ 35
(C) Goods sold to Shyam on credit ₹ 5,00,000
(D) Cheques deposited but dishonoured. [1]
Answer:
(C) Goods sold to Shyam on credit ₹ 5,00,000

Question 9.
Term used for exhaustion of natural resources :
(A) Depreciation
(B) Depletion
(C) Amortisation
(D) Both (A) and (B) [1]
Answer:
(B) Depletion

Question 10.
Under straight line method, depreciation is calculated on cost of an asset. [1]
Answer:
Original

Question 11.
Give any one limitation of trial balance. [1]
Answer:
Double sided errors can be located by preparing it.

Question 12.
Credit sales to Ashmi ₹ 50,000 recorded in Purchases Book. This is an error of ………….. [1]
Answer:
Error of commission

Question 13.
What is an account called in which the amount of difference of two sides of the Trial Balance is transferred temporarily? [1]
Answer:
Suspense Account.

Read the hypothetical text below and answer the Questions 14 to 17.
Ravindra Tyagj started his firm on 1st April 2020. He brought ₹ 2,00,000 in cash furniture worth ₹ 1,00,000 and machinery worth ₹ 50,000. On 15th April, he employed ₹ 70,000 more in his business and on 18th April, he opened a bank account and deposited ₹ 45,000 cash. The distributed goods worth ₹ 20,000 as free samples on 17th April. He on 20th April bought goods worth ₹ 20,000 and issued cheque against the payment.

Question 14.
Which account will be credited to record the transaction taken place on 1st April?
(A) Cash Account
(B) Furniture Account
(C) Capital Account
(D) None of These [1]
Answer:
(C) Capital Account

Explanation: Impersonal Following journal entry will be passed:

Question 15.
Which Account will be debited for the transaction on 15th April?
(A) Purchase A/c
(B) Cash A/c
(C) capital A/c
(D) Bank A/c [1]
Answer:
(B) Cash A/c

Explanation: Following entry will be passed:

[Being additional capital introduced]

Question 16.
Which account will be credited for transaction on 17th April?
(A) Purchase A/c
(B) Advertisement A/c
(C) Cash A/c
(D) Bank A/c 111
Answer:
(A) Purchase A/c

Explanation: Following entry will be passed:

[being goods distributed as free sample]

Question 17.
Which account will be credited for transaction on 20th April?
(A) Purchase A/c
(B) Bank A/c
(C) Sales A/c
(D) cash A/c [1]
Answer:
(B) Bank A/c

Explanation: Following entry will be passed: Purchase A/c Dr.

[Being goods purchased by cheque]

Read the hypothetical text below and answer the Questions 18 to 21.
Jamuna and company bought a machinery on 1st oct 2014 of ₹ 1,90,000 and spent ₹ 10,000 on its installation. On july 1st 2015, it purchased another machine of ₹ 50,000. On 1st April 2016, the company sold the machine/ which was purchased on 1st oct 2014) at a loss of ₹ 20,000 and bought another machine on the same day of ₹ 1,00,000. The company uses straight line method of depreciation @ 10% p.a. and closed its account on 31st march every year.

Question 18.
What amount of depreciation will be charged on machinery purchased on 1st oct 2014 for the year ended 2014-15
(A) ₹ 20,000
(B) ₹ 50,000
(C) ₹ 5,000
(D) ₹ 10,000 [1]
Answer:
(D) ₹ 10,000

Explanation: Depreciation will be charged for 6 months.
So Amount of Dep. for 2014 – 15 =
(1,90,000 + 10,000) = 2,00,000 x \(\frac { 10 }{ 100 }\) x \(\frac { 6 }{ 12 }\)
= ₹ 10,000

Question 19.
What amount of Depreciation will be charged on machinery purchased on 1st july 2015, at the end of the year 2015-16?
(A) ₹ 3,750
(B) ₹ 5,000
(C) ₹ 6,350
(D) None of These [1]
Answer:
(A) ₹ 3,750

Explanation: Machinery was purchased on 1st July 2015.
So Depreciation will be charged for 9 months.
Amount of Dep. For 2015 – 16 =
= 50,000 x \(\frac { 10 }{ 100 }\) x \(\frac { 9 }{ 12 }\)
= ₹ 3,750

Question 20.
What was the sales proceeds of the machinery sold on 1st April 2016?
(A) ₹ 1,70,000
(B) ₹ 1,50,000
(C) ₹ 1,90,000
(D) ₹ 2,00,000 [1]
Answer:
(B) ₹ 1,50,000
Explanation: Total Depreciation charged on the machinery sold:
₹ 10,000(for 2014 – 15)+ ₹ 20,000 (for 2015 – 16)
= ₹ 30,000
Value of machinery after depreciation
= ₹ 2,00,000 – ₹ 30,000 = ₹ 1,70,000
Loss on sale of machinery = ₹ 20,000
So, sales proceed= ₹ 1,70,000 – ₹ 20,000 = ₹ 1,50,000

Question 21.
What would be the closing balance of machinery Account at the end of the year 2016?
(A) ₹ 90,000
(B) ₹ 1,31,250
(C) ₹ 95,000
(D) ₹ 1,26,750 [1]
Answer:
(B) ₹ 1,31,250
Explanation: Closing Balance of 2nd machine = 50,000 – (3,750 + 5,000)
= 50,000 – 8,750 = ₹ 41,250
Closing Balance of 3rd machine
= 1,00,000 – 10,000= ₹ 90,000
Total closing Balance of machinery A/c = 41,250 + 90,000= ₹ 1,31,250

Question 22.
Describe the fundamental accounting equation. How are revenue and expense accounts related to it? [3]

Create an accounting equation on the basis of the following transactions:

Started business with cash ₹ 8,00,000 and goods ₹ 2,00,000.
Cash deposited in Bank ₹ 5,00,000.
Purchased machinery from Arjun ₹ 10,000.
Bought goods for cash ₹ 80,000.
Paid to Arjun by cash ₹ 10,000.
Salary paid by cheque ₹ 20,000. [3]

Answer:
Fundamental accounting equation shows the relationship between capital, liabilities and assets. One side of the equation shows the assets owned by the business and the other side describes how the acquisition of assets has been financed and the claims which exist against the business. It can be expressed as follows:

Assets = Capital + Liabilities

Revenue and expenses accounts are not shown separately in the equation. These are adjusted in the capital. Revenues being incomes or gains are added to capital and expenses or losses are deducted from the capital.

Commonly Made Error
Students are not able to answer the second part of the question.

Answering Tip
Along with accounting equation, understand and learn how different accounts are adjusted with the equation

Accounting Equation

Commonly Made Errors
For starting business with goods, students add the amount of goods in the value of cash introduced. w While adjusting salary students do not reduce the amount of capital with the amount of salary.

Answering Tips
Where goods are introduced on the commencement of business, its value is shown separately as stock and not included in the value of cash.

Students should remember that there are dual impacts of every transaction. If salary is paid by cheque, bank will be reduced and simultaneously capital will be reduced by the same amount.

Question 23.
Rajaram Ltd. purchased goods worth ₹ 20 Lakh and sold 3/4th of such goods during year 2008-09. The market price of the remaining goods was ₹ 3.5 lakh on 31st March, 2009. The Balance Sheet of the company shows the closing stock of goods at ₹ 5 lakh. Explain the accounting principle which has been violated. [4]

Distinguish between debtors and creditors.
Answer:
There is a violation of prudence concept. “Do not anticipate profits but provide for all losses” is the premise on which conservatism (prudence) concept is based. This concept suggests that if choice is available, the accountant should anticipate all probable losses and should provide for them but he should not anticipate probable gains and revenues. Following are some of the examples of conservatism:

Making the provision for doubtful debts and discount on debtors.
Valuing the stock in trade at market price or cost price, whichever is less.
Creating provision against fluctuation in the price of investments.
Charging of small capital items, like crockery, to revenue.
Adopting written-down value method of depreciation.
Amortization of intangible assets like goodwill.
Showing joint life policy at surrender value as against the amount paid.
Not providing for discount on creditors.

Commonly Made Error
“Historical cost concept” is explained by some students.

Answering Tip
Students should understand that historical cost concept relate to fixed assets and not to stock.

OR
Difference between Debtors and Creditors

Basis of Difference	Debtors	Creditors
(i) Meaning	Persons or organizations that are liable to pay money to a firm are called debtors.	Persons or organizations to whom the firm is liable to pay money are called creditors.
(ii) Nature	They have debit balance in the firm’s books.	They have a credit balance in the firm’s books.
(iii) Settlement	Amount due is received from them.	Payments are made to them.
(iv) Treatment	They are shown as assets in the Balance Sheet under Current Assets.	They are shown as liabilities in the Balance Sheet under Current Liabilities.

Question 24.
On 31st January, 2017 Cash Book showed an overdraft balance of ₹ 40,000. On comparing it with the Pass Book, the following differences were noticed:
(i) On 27th January, cheques amounting ₹ 6,450 were sent to bank, but out of these, one cheque of ₹ 840 was credited on 2nd February and one cheque of ₹ 220 was returned by bank as dishonoured on 4th February.

(ii) During the month of January, cheques were issued worth ₹ 7,580. Out of these, cheques worth ₹ 6,420 were presented for payment on 5th February.

(iii) As per standing orders, the Bank had paid the following amounts during January 2017 :

Life insurance Premium ₹ 710.
Electricity Bill ₹ 615.

(iv) Bank collected ₹ 500 as dividend on shares and gave wrong credit for ₹ 650.

(v) Interest charged on overdraft by the Bank ₹ 600.

Prepare a Bank Reconciliation Statement on 31st January, 2017. [4]
Answer:
Bank Reconciliation Statement
as at 31st January, 2017

Commonly Made Errors
Students get confused when in a same point more than one date and amount is given. w In case of point (iv) many students just deduct ₹ 150 (₹ 650 – ₹ 500) which is a wrong treatment.

Answering Tips
Properly read the points and then understand what treatment is to be given to which amount. w There will be two deductions: one for dividend collected directly by bank of ₹ 500 and the second for wrong credit of ₹ 650.

Question 25.
What are the advantages of Petty Cash Book? [4]
Answer:
Following are the important advantages of maintaining a Petty Cash Book:

It saves the time of main cashier.
It helps in controlling the petty expenses.
Posting from Petty Cash Book is made at the end of a specified period. It saves the time and simplifies the posting.
When expenses paid are reimbursed to petty cashier, these are checked by the main cashier. It reduces the chances of errors and frauds.

Commonly Made Error
Advantages of petty cash books are mixed with advantages of cash book.

Answering Tip
Make concepts clear for petty cash book and learn the advantages of petty cash book.

Question 26.

What is ‘Cost Accounting’?
What do you mean by ‘Management Accounting’? [6]

Answer:
(i) Cost Accounting: Cost accounting is the branch of accounting which deals with recording cost with the objective of ascertaining, reducing and controlling cost. It includes the accounting procedures relating to recording of all income and expenditure and preparing

periodical statement of costs and reports. The information provided by cost accounting is helpful in determining the prices of products and services, exercising control over the cost being incurred through estimating standard cost in advance and comparing with actual costs.

(ii) Management Accounting: Management ac counting represents the accounting informa tion about cost, funds, profits, etc. in such a way that enables management to discharge their functions effectively and efficiently. Statements prepared through management accounts are helpful in decision-making process. The information provided by man agement accounting is financial as well as non-financial. It may be futuristic in nature and relevant for decision-making.

Commonly Made Error
This question is not attempted by most of the students or is wrongly answered.

Answering Tip
Understand the meaning and concept of Management Accounting.

Question 27.
Azad Ltd. Purchased furniture on October 01,2012 for ₹ 4,50,000. On March 01,2013 it purchased another furniture
for ₹ 3,00,000. On July 01, 2014 is sold off the first furniture purchased in 2012 for ₹ 2,25,000. Depreciation is provided at 15% p.a. on written down value method. Prepare Furniture account, and Accumulated depreciation account for years ended on March 31,2003, March 31,2014 and March 31,2015. Also, give the above two accounts if furniture disposal account is opened. [6]
Answer:
Furniture Account

Accumulated Depreciation Account

Furniture Disposal A/c

Question 28.
Rectify the following errors assuming that suspense account was opened.
Ascertain the difference in Trial Balance :

Credit sales to Mohan ₹ 7,000 were recorded in Purchases Book. However, Mohan’s account was correctly debited.
Credit purchases from Rohan ₹ 9,000 were recorded in sales book. However, Rohan’s account was correctly credited.
Goods returned to Rakesh ₹ 4,000 were recorded in Sales Return Book. However, Rakesh’s account was correctly debited.
Goods returned to Mahesh ₹ 1,000 were recorded through Purchases Return Book. However, Mahesh’s account was correctly credited.
Goods returned to Naresh ₹ 2,000 were recorded through Purchases Book. However, Naresh’s account was correctly debited. [8]

The Trial Balance of Mr. Rameshwar had ₹ 2,980 excess credit. The difference has been posted to Suspense Account. Subsequently, the following errors were discovered. You are required to pass necessary entries for rectifying the errors and also show the Suspense Account:

Total of Returns Inward Book was cast short by ₹ 750.
Purchase of Motor bike for personal use costing ₹ 45,000 had been posted to Motor Vehicle A/c.
An amount of ₹ 3,750 paid for wages for making show cases had been charged to Wages A/c.
Purchases of ₹ 4,350 has been posted to Creditors Account as ₹ 3,450.
Machinery was written off by ₹ 2,500 but has not been posted to Depreciation A/c.
Goods purchased for ₹ 6,700 were posted as ₹ 670 to Purchases A/c.
Amount of ₹ 12,800 paid to Maya was wrongly debited to Daya as ₹ 18,200. [8]

Answer:
In the Books of ………..
Journal Entries

Suspense Account

Journal Entries

Dr. Suspense Account Cr.

Part-B [24 Marks]
Financial Accounting-II

Question 29.
………….. is a statement showing true and fair view of the operating performance of the enterprise.
(A) Position Statement
(B) Income Statement
(C) Profit & Loss Appropriation Account
(D) None of the above [1]
Answer:
(B) Income Statement

Question 30.
………………. is a statement and not an account. [1]
Answer:
Balance Sheet

Explanation: Balance sheet is a component of final accounts. It contains liabilities on one side and assets on another side, it is a statement not an account.

Question 31.
Accrued Income means :
(A) Income due but not yet received
(B) Income received but not belonging to current period
(C) Both (A) and (B)
(D) None of the above [1]
Answer:
(A) Income due but not yet received

Question 32.
The Balance Sheet of M/s X Traders is showing a difference between the total amounts of assets side and liabilities side. Its accountant has recorded closing stock on the assets side of the Balance sheet only. Identify where a mistake is made by him.
(A) Closing stock should be recorded on the credit side of the Profit & Loss Account also.
(B) Closing stock should be deducted from the amount of Purchases in Trading Account also.
(C) Closing stock should be recorded on the debit side of the Profit & Loss Account also.
(D) Closing stock should be recorded on the credit side of the Trading Account also. [1]
Answer:
(D) Closing stock should be recorded on the credit side of the Trading Account also. [1]

Question 33.
The initial amount that is invested into business is called …………… [1]
Answer:
Capital

Question 34.
Which of the following is a type of direct Expense?
(A) Wages
(B) Factory light
(C) Carriage inward
(D) All of these [1]
Answer:
(D) All of these

Explanation: Direct Expenses are here capital with are directly associated with the manufacturing goods.

Question 35.
Unearned incomes are those which:
(A) Have been earned but not been received
(B) Have been received but not been earned
(C) Earned by speculation
(D) None of These [1]
Answer:
(B) Have been received but not been earned

Explanation: Unearned incomes are those which have been received but their consideration has not been paid.

Question 36.
What adjustment entry is passed for interest on capital and what is its treatment in final account? [3]
Answer:
Adjustment Entry:
Interest on Capital A/c Dr.
To Capital A/c
(Being Interest allowed on capital)

Treatment in Final Account: Interest on capital is an expense for the business and hence, it is shown on the debit side of Profit & Loss Accounts. At the same time, it is a gain to the proprietor and hence is added to his capital.

Question 37.
Rakesh and company prepared its final accounts and committed some mistakes which are as follows:
(a) Carriage outward was shown in trading Account.
(b) Depreciation while given in trial balance was shown in profit & loss Account and also by way of subtracting
from the concerned asset in balance sheet.
(C) Outstanding wages given in trial balance, was shown in trading Account.

Now answer the questions on the basis of the above information:

What was wrong and what should be the correct treatment of Error (a)?
What was wrong and what should be the correct treatment of Error (b)?
What was wrong and what should be the correct treatment of Error (c)? [2]

Answer:
(i) Trading accounts contains only direct Expenses while carriage outward is an indirect Expense hence should not be shown in trading Account. It should be shown in profit and loss A/c.[1+1J

(ii) As depreciation given in the trial balance means it has been charged to Asset A/c. Hence should be shown only in profit and Loss All.

(iii) Outstanding wages is a representative personal account while trading A/c contains nominal accounts. Hence it should be shown in balance sheet.

Question 38.
From the following Trial Balance of Rohit Sharma, prepare Trading and Profit & Loss Account for the year ending 31st March, 2016 and a Balance Sheet on the same date after making necessary adjustments :

Adjustments:

Closing stock was ₹ 16,000.
Wages ₹ 2,000 and Salaries ₹ 1,200 are outstanding.
Rent for two months at the rate of ₹ 500 per month is outstanding.
Depreciate Building by 5% and Machinery by 10%.
Prepaid insurance ₹ 200. [8]

The Following are the balances extracted from the books of Rajan on 31st March, 2013 : STD

Additional Information:

Stock on hand on 31st March, 2013 was ₹ 20,060.
Write off Depreciation : Business premises ₹ 300, Furniture and fitting ₹ 250.
Make a provision of 5% on Debtors for Doubtful debts.
Carry forward ₹ 200 for unexpired Insurance.
Outstanding salary ₹ 1,500

Prepare Trading and Profit & Loss A/c for the year ended March 31,2013 and a Balances sheet as on that date [8]
Answer:
Trading and Profit & Loss
Dr. Account for the year ending on 31st March, 2016 Cr

Balance Sheet as at March 31,2016

Commonly Made Error
Students sometimes miss out certain adjustments.

Answering Tip
Keep in mind all the adjustments while solving the question.

Trading and Profit & loss Account
for the year ended March 31, 2013

Balance Sheet
as on 31st March, 2013