CBSE Sample Papers for Class 11 Accountancy Set 9 with Solutions

Students must start practicing the questions from CBSE Sample Papers for Class 11 Accountancy with Solutions Set 9 are designed as per the revised syllabus.

CBSE Sample Papers for Class 11 Accountancy Set 9 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 is the last step of accounting as a process of information?
(A) Posting to ledger
(B) Communicating the results
(C) Journalizing
(D) Analysis and Interpretation [1]
Answer:
(B) Communicating the results

Explanation: The process of accounting starts with the identification of business transactions and at the last step, it communicates the results of the operating performance and the financial position of the firm to the interested parties.

Question 2.
…………… issues accounting standards in India. [1]
Answer:
ICAI

Explanation: In India, the accounting standards are issued by the Institute of the Chartered Accountants of India which was set up in the year 1949 with the objective to bring uniformity in the work of accounting in India.

Question 3.
account should be credited if goods are withdrawn by the proprietor for private use. [1]
Answer:
Purchases

Question 4.
Which of the following is a book of prime entry:
(A) Ledger
(B) Journal
(C) Cash Book
(D) Subsidiary Books [1]
Answer:
(B) Journal

Explanation: Entries are first recorded in the journal. So, it is called the prime book of entry as every transaction first finds the place in the journal.

Question 5.
Outstanding rent is a …………… account. [1]
Answer:
Personal

Question 6.
In which subsidiary book all transactions relating to cash receipts and cash payments are recorded?
(A) Cash Account
(B) Journal Proper
(C) Cash Book
(D) Ledger [1]
Answer:
(C) Cash Book

Question 7.
Which type of sales are recorded in sales book?
(A) All type of sales
(B) Only credit sales of goods
(C) Credit sale of any item
(D) Cash sale of any item [1]
Answer:
(B) Only credit sales of goods

Question 8.
Which of the following is not a reason for difference in the Cash Book and Pass Book balances?
(A) Cheques deposited in bank but dishonoured
(B) Interest allowed by bank
(C) Labour strike in factory
(D) Bank charges [1]
Answer:
(C) Labour strike in factory

Question 9.
Give one way through which secret reserve is created. [1]
Answer:
By under valuation of inventories

Question 10.
Give an example of capital reserve.[1]
Answer:

Premium on issue of shares
Premium on issue of debentures
Profit on sale of fixed assets (Any one)

Question 11.
Cash book is a/an:
(A) Account
(B) Subsidiary book
(C) Statement
(D) Both (A) and (B) [1]
Answer:
(D) Both (A) and (B)

Explanation: Cash book serves the purpose of both an account as well as a subsidiary book. All the cash transactions are first recorded in the cash book, so, it is serving the purpose of the subsidiary book and as it includes all the cash transactions, it also serves the purpose of the cash account because ledger is not prepared for the cash book.

Question 12.
Errors which are committed due to wrong posting of transactions, wrong totalling or balancing of accounts, etc. are called …………… [1]
Answer:
Errors of commission

Question 13.
Sales book is overcast by ₹ 1,500 and purchase return book is undercast by ₹ 1,500. This is a ……………. error. [1]
Answer:
Compensating error

Read the following hypothetical Case Study and answer the given questions 14 to 17:
Mr. Manoj Manohar Lai Started a new business with a cash of ₹ 60,000 by the name Manohar Lai and Sons on the 1st of March 2020. For the business, he had to purchase furniture on the 2nd of March worth ₹ 10,000. On the same day he bought goods of ₹ 25000 and paid cash also he purchased goods of ₹ 50000 from Jankidas and sons on credit.

On the 4th of March he was able to sell the goods at ₹ 60,000 out of which 75% was on credit to different people. On the 5th of March he bought further goods from Kamlesh worth ₹ 15,000 and on the same day he sold goods at ₹ 36,000 for cash. On the 8“ of March he received 80% of the cash from his debtors and so he paid his creditor Jankidas and Sons ₹ 40,000.

On the 10th of March he sold goods to Hari at ₹ 30,000 and paid ₹ 15,000 to Kamlesh. Hari paid him ₹ 18,000 on the 14th of March. On 16th he purchased goods worth ₹ 14,000 from Sohan out of which he paid ₹ 8,000 in cash. On the 20th he paid the office rent of ₹ 1,000 and received commission of ₹ 750.

On the 24th there was a lockdown announced, so he paid salary to his employee of ₹ 1,200 and told him not to come until things are better. Hari on the same day transferred to his bank account ₹ 12,000 and he withdrew ₹ 4,000 for personal use.

Question 14.
What will be the journal entry for the cash introduced by Mr. Manoj Manohar lal to commence his business? [1]

Answer:
Option (B) is correct

Explanation: Cash is coming into the business. So cash account will be debited and capital is representing the creditor (owner), so it will be credited.

Question 15.
The goods purchased from Kamlesh will be recorded in Account. [1]
Answer:
Kamlesh’s

Question 16.
For the sale of goods on 4th of March how much will be recorded in the Cash Account.
(A) ₹ 60,000
(B) ₹ 45,000
(C) ₹ 15,000
(D) ₹ 75,000 [1]
Answer:
(C) ₹ 15,000

Question 17.
The amount deposited by Hari directly in the bank will be recorded in the …………….. account. [1]
Answer:
Bank

Explanation: Amount has directly been deposited by Hari in bank account, so bank account will be debited.

Read the following hypothetical Case Study and answer the given questions 18 to 21:
Astha Ltd, which closes its books on 31st March every year, purchased on 1st July 2018, machinery costing ₹ 30,000. It purchased further machinery on 1st January 2019 costing ₹ 20,000 and on 1st October 2019 costing ₹ 10,000. On 1st April 2021 one-third of the machinery installed on 1st July 2018 became obsolete and was sold for ₹ 3,000. It being given that machinery was depreciated by Diminishing Balance Method at 10% per annum.

Question 18.
What will be the depreciation to be charged on the machinery purchased on 1st July 2018, by the end of 31st March 2020 for 2019-2020.
(A) ₹ 3,000
(B) ₹ 2,565
(C) ₹ 2,430
(D) ₹ 2,775 [1]
Answer:
(D) ₹ 2,775

Explanation: Amount of Dep. for 2018 – 19
= 30,000 x \(\frac { 10 }{ 100 }\) x \(\frac { 9 }{ 12 }\)
= ₹ 2,250
Dep. for 2019 – 20
(30,000 – 2,250) x \(\frac { 10 }{ 100 }\)
= 27,750 x \(\frac { 10 }{ 100 }\)
= ₹ 2,775

Question 19.
What is the total depreciation charged on the machinery purchased on 1st January 2019 by the end of 31st March 2021?
(A) ₹ 5,420
(B) ₹ 1,755
(C) ₹ 2,450
(D) ₹ 2,000 [1]
Answer:
(C) ₹ 2,450
Explanation: Dep. for 2019 – 20
20,000 x \(\frac { 10 }{ 100 }\) x \(\frac { 3 }{ 12 }\)
Dep for 2020 – 21
= (20,000 – 500) x \(\frac { 10 }{ 100 }\)
= ₹ 1,950
Total Amount of Dep. 500 + 1,950
= ₹ 2,450

Question 20.
What is the profit/loss on the sales proceeds of the machinery sold on 1st April 2021?
(A) Loss of ₹ 5,325
(B) Profit of ₹ 5,325
(C) Loss of ₹ 8,325
(D) No profit no loss [1]
Answer:
(A) Loss of ₹ 5,325

Question 21.
……………….. account is opened when the value of machinery is not decreased in the books of accounts.
Answer:
Provision for depreciation

Question 22.
What is a source document?
Answer:
According to the verifiable objective principle of accounting, only those transactions should be recorded in the accounting books, which are evidenced and supported by business documents, so that the accounting data becomes verifiable and unbiased.

The documents on the basis of which transactions are recorded in the book of original entry are called ‘source documents’. These documents are written and considered authentic proof of the correctness of recorded transactions. These must be preserved for future reference and for the purpose of auditing and tax assessment. In case of any disputes, these serve as the legal evidence.

Commonly Made Error:
Vouchers are explained instead of “source documents”.

Answering Tip:
Properly understand the difference between “source documents” and “vouchers”.

Question 23.
Explain the meaning and significance of Accounting Entity Principle. [4]

State the meaning of the following:

Depreciation
Revenue
Trade Discount
Current Assets [4]

Answer:
Meaning: Under the Accounting Entity Principle, an accounting entity is held to be “Separate and distinct from its owners”. Following this principle, we record all the transactions of the business from the point of view of the business and not from the point of view of the proprietor.

Significance: As we consider owner to be distinct from the business, he/she is treated as a creditor to -the extent of the capital contributed. It is important to understand that without such a distinction, the affairs of the business will be all mixed up with the private affairs of the proprietor and true picture of the firm will not be available.

The principle of accounting entity is applicable to all types of businesses. In case of sole proprietorship and partnership firm, though the sole proprietor or the partners are not considered as separate entities in the eyes of law, for accounting purposes they will be considered as separate entities. In case of companies, the law recognizes legal entity of the business separate from its owners, i.e., shareholders.

The accountant will record transactions between the owner and the firm. For instance, when capital is provided by the owner, the record will be shown by the firm as having received money and the same being owed to the proprietor. In case, the proprietor withdraws money from the business, it will be charged to him. An account is maintained for the owner in the name of capital like other parties. [4]

Commonly Made Error
Some students explain “accounting period principle” instead of “accounting entity principle”.

Question 24.
What is the importance of Bank Reconciliation Statement? [4]
Answer:
Preparation of bank reconciliation statement is important due to the following reasons:
1. Reconciliation helps the management in checking the accuracy of entries recorded in Cash Book.

2. It helps in keeping the track of cheques, etc., sent to the bank for collection. Any undue delay in the clearance of cheques can be noticed.

3. It helps in bringing out any errors that may have been committed either in Cash Book or in the Pass Book.

4. A regular reconciliation discourages the staff of the firm or of the bank from embezzlement of funds.

Commonly Made Error
This question is not answered by most of the students as they are not able to explain the advantages of BRS.

Answering Tip
Understand and learn how BRS is important

Question 25.
Enter the following transactions in a two column Cash Book:

Commenced business with cash ₹ 50,000.
Deposited into bank ₹ 40,000.
Received cash from Mohan ₹ 950 in full settlement of a debt of ₹ 1,000.
Bought goods for cash ₹ 10,000. [4]

Name the books of original entry where the following transactions will be recorded with reasons thereof :

Goods purchased from Geeta ₹ 50,000 on credit.
Purchase of furniture on credit for use in shop.
Provision for doubtful debts created @ 5% on debtors with book value of ₹ 10,000.
Defective goods sold to Bina on credit worth ₹ 7,000 were returned by her. [4]

Answer:

Commonly Made Errors

For depositing cash in bank, students get confused in deciding whether cash A/c has to appear in debit side or credit side and same for bank A/c. Students get confused whether to post the entry with ₹ 1,000 or ₹ 950.

Answering Tips

Students should carefully read the transaction and frame a journal entry and then post it in Cash Book, Entry is posted with the amount of cash actually received.

(i) Purchase Book
Reason: Because Goods are purchased on credit.

(ii) Journal Proper
Reason: Furniture is purchased on credit.

(iii) Journal Proper
Reason: This can not be recorded in any other subsidiary books.

(iv) Returns Inward/Sales Return Book
Reason: Goods received back due to defect.

Commonly Made Error
Students get confused when transactions are to be entered in Journal Proper.

Answering Tip
Students should understand what Journal Proper is, why it is prepared and which transactions are entered in it.

Question 26.
Define accounting and state any three of its objectives. [6]
Answer:
Accounting is the process of identifying, measuring, recording the business transactions and communicating the required information to the interested users.

Objectives of Accounting:
(i) Maintenance of records of business transac¬tions: Accounting is used for the maintenance of a systematic record of all financial transac¬tions in books of accounts.

(ii) Calculation of Profit & Loss: The owner of business must have an idea of accounts to note results of their business operations periodically i.e., whether the business has earned a profit or incurred a loss.

(iii) Depiction of financial position: Accounting also aims at ascertaining the financial position of the concern in the form of its assets and liabilities at the end of every accounting period.

(iv) Providing accounting information to its users: The accounting information generated by the accounting process is communicated in the form of reports, statements, graphs & charts to the users who need it in different decision and situations. (Any three)

Question 27.
Ram Bros purchased a Machinery for ₹ 1,40,000 on July 1, 2014 and spent ₹ 10,000 on it’s installation. Prepare; Machinery A/C and Depreciation A/c for 2014, 2015 & 2016, assuming the books are closed on 31st December
every year and depreciation is charged @ 10% p.a. on Straight Line Method. [6]
Answer:
In the Books of Ram Bros.
Dr. Machinery Account Cr.

Dr. Depreciation Account Cr.

Question 28.
Trial Balance of Rahul did not agree. Rahul put the difference into Suspense Account. Subsequently, he located the following errors:

Wages paid for installation of Machinery ₹ 600 were posted to Wages’A/c.
Repairs to Machinery ₹ 400 were debited to Machinery A/c.
Repairs paid for the overhauling of second hand machinery purchased ₹ 1,000 were debited to Repairs A/c.
Own business material ₹ 8,000 and wages ₹ 2,000 were used for construction of building. No adjustment was made in the books.
Furniture purchased for ₹ 5,000 was posted to Purchases A/c as ₹ 500.
Old machinery sold to Karim at its Book value of ₹ 2,000 was recorded through Sales Book.
Total of Sales Returns Book ₹ 3,000 was not posted to the ledger.

Rectify the above errors and prepare Suspense Account to ascertain the original difference in Trial Balance. [8]

Trial Balance of Anurag did not agree. It showed an excess credit of ₹ 10,000. Anurag put the difference into Suspense Account. He located the following errors :

Sales returns book was overcast by ₹ 1,000.
Purchases book was undercast by ₹ 600.
In the Sales Book, total of page No. 4 was carried forward to page No.5 as ₹ 1,000 instead of ₹ 1,200 and total of page No. 8 was carried forward to page No. 9 as ₹ 5,600 instead of ₹ 5,000.
Goods returned to Ram ₹ 1,000 were recorded through Sales Book.
Credit purchases from M and Co. ₹ 8,000 were recorded through Sales Book.
Credit purchases from S and Co. ₹ 5,000 were recorded through Sales Book. However, S and Co. were correctly credited.
Salary paid ₹ 2,000 was debited to Employee’s Personal Account. Rectify the above errors and prepare Suspense A/c

Answer:
In the Books of Rahul
Journal Entries

Dr. Suspense Account Cr.

In the Books of Anurag
Rectsying Entiies

Note: Errors in carrying forward the total of one page to another during a period finally affects the total of that book resulting in error of under/overcasting. In this case, carrying forward from page 4 to 5 resulted in under casting of ₹ 200 and carrying forward from page 8 to 9 resulted in overcasting of ₹ 600. Overall overcasting being ₹ 600 – 200 = ₹ 400.

Dr. Suspense Account Cr.

Commonly Made Error
In point (iii) Some studcnts pass two rectifying entries.

Answrting Tip
Only one rectifying entry is required of ₹400, i.e. with the net effect of undercasting and overcasting.

Part-B (24 Marks)
Financial Accounting-II

Question 29.
While preparing the financial statements, the accountant has put together items of similar nature under a
common heading. This process is called …………….. [1]
Answer:
Grouping

Question 30.
Marshalling of various items in the Balance Sheet can be done in the order of ………… or …………. [1]
Answer:
Liquidit Permanence

Question 31.
Land has been purchased by M/s XYZ Ltd. Registration fees has been paid for the same. Its accountant is not sure about the treatment of the registration fees. Help him to transact it. [1]
Answer:
To be treated as capital expenditure and added to the cost of Land

Question 32.
Entries which are made at the end of each accounting period for the purpose of preparing Profit & Loss Account are called:
(A) Adjusting Entries
(B) Opening entries
(C) Closing Entries
(D) Transfer Entries [1]
Answer:
(C) Closing Entries

Question 33.
Net Profit of a firm before charging Manager’s Commission is ₹ 21,000. If a manager is entitled to 5% commission on Net Profit after charging such commission, what is the commission payable to the manager?
(A) ₹ 1,050
(B) ₹ 1,000
(C) ₹ 950
(D) None of the above [1]
Answer:
(B) ₹ 1,000

Explanation:
Commission paid to manager = 21,000 x 5/105 = ₹ 1,ooo

Question 34.
Which of the following is included in final accounts?
(A) Trading Account
(B) Profit and Loss Account
(C) Balance Sheet
(D) All of the above [1]
Answer:
(D) All of the above

Explanation: Final accounts of a firm include two statements: Income statement and positional statement. Income statement consists of trading account and profit and loss account and positional statement contains balance sheet.

Question 35.
Salaryisa/an ………………. expense. [1]
Answer:
Indirect

Question 36.
Write a short note on outstanding expenses. [3]
Answer:
Outstanding Expenses: At the end of the accounting period, sometimes a business enterprise is left with some unpaid expenses due to one reason or another. Such expenses are termed as outstanding expenses and should be added to the relevant expense in the Trading A/c, Profit & Loss Account and shown at the liabilities side in the Balance Sheet. e.g. outstanding salary.

Question 37.
Prepare a Trading Account from the following particulars for the year ended March 31, 2012: [6]

Look at the information given below:

Opening Stock	₹ 20,000
Cash Purchases	₹ 2,50,000
Credit Purchases	₹ 5,00,000
Cash Sales	₹ 7,50,000
Credit Sales	₹ 3,50,000
Wages	₹ 80,000
Salaries	₹ 1,00,000
Closing Stock	₹ 35,000
Sales Returns	₹ 5,000
Purchases Returns	₹ 10,000

What is value of net sales. [2]
What is the value of cost of goods sold? [2]
What is the value of gross profit? [2]

Answer:
Tradmg Account
Dr. for the year ended March 31, 2012 Cr.

(i) Total Sales = Cash Sales + Credit Saies
= 7,50,000 + 3,50,000
= ₹ 11,00,000
Net Sales = Total Sales – Sales Return
= 11,00,000 – 5,000
= ₹ 10,95,000

(ii) Cost of goods sold = Opening Stock + Net Purchases + Direct Expenses – Closing Stock
= 20,000 + (2,50,000 + 5,00,0(X) — 10,000) + 80,000 – 35,000
= 20,000 + 7,40,000 + 80,000 – 35,000
= ₹ 8,05,000

(iii) Gross Profit = Net Sales – Cost of goods Sold
= 10,95,000 – 8,05,000
= ₹ 2,90,000

Question 38.
On 1st January, 2012 M/s Kanti Bros, had a bad debts provision of ₹ 1,650. On 31stDecember, 2012, the total debtors amounted to ₹ 28,400 out of which ₹ 400 were bad and had to be written off. The firm wants to maintain the Bad debts provision of 5 per cent on the debtors.

On 31stDecember, 2013, total debtors amounted to ₹ 20,500 out of which ₹ 500 had to be written off as bad debts. The Provision is to be maintained at 5% of the debtors. Show the Bad Debts Account and the Bad Debts Provision Account for 2012 and 2013. [8]

The following balances were extracted from the books of Shri Brijesh Chandra on 30th June, 2014:

Particulars	Amount (₹)	Particulars	Amount (₹)
Capital	24,500	Bad debts	550
Drawings	2,000	Loan	7,880
General Expenses	2,500	Sales	65,360
Buildings	11,000	Purchases	47,000
Machinery	9,340	Scooter	2,000
Stock	16,200	Bad debts (provision)	900
Power	2,240	Commission (Cr.)	1,320
Taxes and Insurance	1,315	Scooter Expenses	1,800
Wages	7,200	Bills Payable	3,850
Debtors	6,280	Cash	80
Creditors	2,500	Bank Overdraft	3,300

Prepare final accounts for the year ended 30th June, 2014 after giving effect to the following adjustments :

Stock on 30th June, 2014 was valued at ₹ 23,500.
Write off a further of ₹ 160 as bad debts and maintain the provision for bad debts at 5% debtors.
Depreciate Machinery at 10% and Scooter at 12%.
Provide ₹ 750 for outstanding interest on overdraft.

Answer:
In the books of Kanti Bros.
Dr. Bad Debts Account Cr.

Dr. Provision for Bad Debts Account Cr.

In the Books of Shri Brijesh Chandra Trading and Profit & Loss Account for the year ended 3O” June, 2014 Cr.

Balance Sheet
as on 3OJune 2014

Note: Provision for bad debts has been calculated on 6,120, i.e., 6,280 – 160.

Commonly Made Error
Students get confused while making adjustments for some items like power and commission (Cr.)

Answering Tip
owner is directly related to the goods sold and therefore it becomes a part of Trading A/c. Commission (Cr.) means it is a receipt.