Accounts Paper 2(any 5)

2.] The following is the trial balance of M/S Futuristic trading as on 31-03-07 !articulars %ash in hand 'an( balance Stoc( as on 1st "*ril 0+ $ebtors Furniture -ffice e.ui*#ent 'uilding Motor car %reditors /oan fro# 0$F% ban( 1eser2e for bad debt !urchases Sales !urchase return Sales return Salaries Motor car e3*enses 4odown rent 5nterest on loan 1ates and ta3es $iscount allowed $iscount recei2ed Freight %arriage outwards $rawings !rinting 6 stationar7 8lectricit7 5nsurance *re#iu# 4eneral e3*enses 'ad debts 'an( charges %a*ital of Mr. 1o7 "#ount $r 2&000 )2000 12,0000 1720000 ,2&000 322000 1200000 ,00000 "#ount %r

&+0000 +00000 +0000 2&00000 ,+00000 )2000 &,000 220000 72000 110000 ),000 ,2000 ,&000 32000 2,000 ,0000 2,0000 3+000 ,,000 110000 +0000 ,0000 30000 9,,,000 32,0000 9,,,000

!re*are the final account for the 7ear ended 31st March 07 after considering the following 1: $e*reciate building used for business b7 );< furniture b7 10;< office e.ui*#ent b7 1); and #otor car b7 20;. 2: " steel table *urchased during the 7ear for 1s 2&000 was sold for the sa#e *rice but sale *roceeds were credited to sale account. 3: " *rinter *urchased during the 7ear for 1s &000 was wrongl7 debited to *urchase account. ,: %losing Stoc( was 2alued at 1s &&0000.

): +: 7: &:

-ne #onth=s salar7 and one #onth=s rent are outstanding. The loan fro# 0$F% ban( was ta(en on 1st >ul7 200+ ? 12; *a. The reser2e for bad debts is to be #aintained at ); on debtors. 5nsurance !re#iu# included 1s &000 *aid towards the life *olic7 of Mr. 1o7 and the balance of the insurance was *aid for the *eriod 1st >ul7 200+ to 30th >une 2007. 9: 0alf of the building is used for residential *ur*ose of Mr. 1o7. 3.]a. i.: Fro# the following details of ban( colu#n of the cash boo(< find out the collection fro# debtors being the balancing figure -*ening 'alance %losing 'alance !a7#ent to creditors 'ills recei2ables encashed 'ills *a7able *aid drawings e3*enses &000 ,000 1+0000 1&000 12000 2,000 3+000

ii.: Fro# the following details of the creditors account< find out the figure of credit *urchases the balancing figure -*ening 'alance %losing balance !a7#ents b7 che.ues !a7#ents b7 bills *a7able !a7#ents b7 cash $iscount recei2ed !urchase returns 1+0000 190000 9,0000 100000 20000 10000 20000

b.: Mr. !atel sold goods to Mr. Shah and drew a bill of e3change for 1s 10000 which the later acce*ted. Show @ournal entries of Mr. !atel for each of the following inde*endent situations 1: 0e retains the bill till due date and then realiAed the #one7. 2: 0e discounts the bill with the ban( *a7ing 1s 7)0 as discounting charges 6 bill is honoured. 3: 0e endorsed the bill to Mr. Surana against a#ount due to hi# for 1s 10200 6 the bill is honoured. ,: 0e sent the bill to the ban( for collection and the bill is honoured. ,.]a: -n 1st "*ril 200+< the balance in Machiner7 account of a co#*an7 stood at 1s )+7000. The co#*an7 had the s7ste# of *ro2iding de*reciation at 10; *a on di#inishing balance. Bow it is conte#*lating to change the #ethod to straight line with retros*ecti2e effect fro# 1st "*ril 200,< (ee*ing the rate of de*reciation sa#e. Show #achiner7 account for the 7ears 200,-0)< 200)-0+ 6 200+-07. The co#*an7 had *urchased a new #achine for 1s +0000 on 1st -ctober 200+.

b.: Mohan and Sohan entered into a @oint 2enture agreeing to share *rofits or losses in the ratio of 2 1. The following transactions too( *lace during the tenure of the 2enture. Mohan Sohan %ash de*osited in @oint ban( "/c )0000 2)000 4oods brought in 10000 )000 83*enses incurred )000 2)00 The @oint transactions were 4oods bought for cash 1s 20000 and on credit fro# Mr. Sahani 1s ,0000. 83*enses *aid 1S 1&00. 4oods sold to Mr. 1o7 1s ,0000 against i##ediate che.ue and to Mr. 1a7 for 1s )0000 on 3 #onths credit. Mr. 1a7 acce*ted a bill for this a#ount which was discounted at 1&; *a. Mohan agreed to ta(e o2er the balance stoc( at the 2alue of 1s 2700. Mr. Sahani was *aid 1s 39,00 in full settle#ent. Show >oint Centure "/c< >oint 'an( "/c and the co-2enturers "/c assu#ing that the 2enture was closed b7 settling the a#ount to the co-2enturers. ).]a.] 5n a factor7< a #achine is considered to wor( for 20& hours in a #onth. 5t includes #aintenance ti#e of D hours and set-u* ti#e of 20 hours. The e3*ense data are gi2en below %ost of #achine is 1s )00000 6 it has life of 10 7ears with a sal2age 2alue of 1s 20000 at the end of life. 1e*airs and #aintenance 1s +0,&0 *a< consu#ables 6 stores 1s ,7)20 *a< rent of the building 1s 72000 *a< the #achine occu*ies 1/+th of the area. Su*er2isors= salar7Eco##on to three #achines: 1s +000 *#< o*erators wages *er #achine 1s 2)00 *#< 4eneral lighting charges *er #onth allocated to the #achine 1s 1000< *ower consu#*tion is 2) units *er hour at 1s 2 *er unit. The su*er2isor and o*erators are *er#anent. %onsu#ables and stores 2ar7 with the running of #achine. !ower is re.uired for *roducti2e *ur*oses onl7. Set u* ti#e< although *roducti2e< does not re.uire *ower. %alculate the #achine hour rate for i: set u* ti#e and ii.: 1unning ti#e. b.: The .uarterl7 *roduction of a co#*an7=s *roduct has a stead7 #ar(et at 20000 units. 8ach unit re.uires 0.) (g of raw #aterial. The ordering cost is 1s 100 *er order and the in2entor7 carr7ing cost is 1s 2 *er annu#. The lead ti#e for *rocure#ent is 3+ da7s and the safet7 stoc( is 1000 (g. the co#*an7 has negotiated the following *rices for the *rocure#ent of raw #aterial -rder .uantit7 E(g: $iscount E1s: F* to +000 Bil +000-&000 ,00 &000-1+000 2000 1+000-30000 3200 30000-,)000 ,000

%alculate the re-order *oint ta(ing 30 da7s in a #onth. !re*are a state#ent showing total cost of *rocure#ent 6 storage of #aterial after considering discounts if co#*an7 elects to *lace 1<2<, or + orders in a 7ear. "lso calculate the nu#ber of orders the co#*an7 should *lace to #ini#iAe the costs after ta(ing 8-G also into consideration. +.] The following details were e3tracted fro# the boo(s of a #anufacturing co#*an7 for the #onth of March 2007. Sales for the #onth 1s &)00000 -*ening Stoc( 12)000 (g ? 1s 30 *er (g !urchases #arch 7 1)0000 (g ? 1s 31.10 *er (g March 27 100000 (g ? 1s 31.20 *er (g %losing Stoc( on March 31 130000 (g. The ad#inistration o2erhead for the #onth a#ounted to 1s 172000. Hor( out the following using F5F- 6 /5F- #ethods 1: Calue of %losing Stoc( as on 31st March 2007. 2: %ost of Sales for the #onth of Mach 3: !rofit or loss for the #onth of March. 7.] " co#*an7 has decided to install a new #achine for #anufacturing a new *roduct. The #a3i#u# *ossible sales are 1s )0 lacs. The co#*an7 is considering two #odels M1 and M2 for which the following details are a2ailable M1 M2 Ma3i#u# sales *er 7ear 1s )0 lacs 1s )0 lacs Fi3ed cost *er 7ear 1s ) lacs 1s & lacs 8sti#ated *rofit for #a3i#u# sales 1s 1) lacs 1s 17 lacs %alculate the brea( e2en sales for both the #odels of the #achine. %alculate the sales le2el at which both #achines will gi2e sa#e a#ount of *rofit. 'ased on the co#*utations< which #odel will be #ore *rofitable than the other o2er a range of salesI