KARPAGAM ACADEMY OF HIGHER EDUCATION

(DeemedtobeUniversityEstablishedUnder Section3ofUGCAct 1956)

Coimbatore– 641021.

Faculty: Dr.K.Geethanjali (Assistant Professor)

Subject Name: Basic Accounting Sub. Code: 23CCU501
Semester: III Class: III B.Sc (IT)
Possible Questions
UNIT I
PART A
1. What is accounting?
2. Define bookkeeping.
3. Name the branches of accounting.
4. What are the three types of accounts?
5. State the golden rule of personal accounts.
6. What is a journal in accounting?
7. What is a ledger?
8. Define the 'Going Concern' concept.
9. What is the Matching Concept?
10. What is meant by Double Entry System?
11. What is a Real Account?
12. Define Nominal Account.
13. What is the 'Conservatism Convention'?
14. What is the 'Consistency Convention'?
15. What is a Trial Balance?
16. What is an Accounting Period?
17. What is Financial Accounting?
18. What is the main objective of bookkeeping?
19. What is the Dual Aspect Concept?
20. What is a Cash Book?
PART B
1. What is accounting? Discuss its importance in business.
2. Define bookkeeping and explain its role in accounting.
3. What are the branches of accounting? Explain their functions.
4. What are the types of accounts in accounting? Explain with examples.
5. Discuss the rules of debit and credit for different accounts.
6. Explain the "Dual Aspect" concept in accounting.
7. What is a journal? Discuss its significance in the accounting process.
8. Explain the ledger and its role in accounting.
9. What is the concept of "Going Concern" in accounting?
10. What is the "Accrual Concept" in accounting?
11. Discuss the "Matching Concept" in accounting.
12. What is the "Consistency Concept" in accounting?
13. Explain the "Conservatism" convention in accounting.
14. What is a trial balance? How is it prepared?
15. What is the difference between a journal and a ledger?
16. Journalize the following transaction.
Purchased furniture for cash Rs.3000
Sold goods to James Rs.2000
Paid rent to Krishnan, the landlord Rs.800
Paid Lokesh, the manager his salary Rs.3000
 Sold goods for cash Rs.8000
17. On April 01, 2016 Anees started business with Rs. 100,000 and other transactions for the month
are:
2. Purchase Furniture for Cash Rs. 7,000.
8. Purchase Goods for Cash Rs. 2,000 and for Credit Rs. 1,000 from Khalid Retail Store.
14. Sold Goods to Khan Brothers Rs. 12,000 and Cash Sales Rs. 5,000.
18. Owner withdrew of worth Rs. 2,000 for personal use.
22. Paid Khalid Retail Store Rs. 500.
26. Received Rs. 10,000 from Khan Brothers.
30. Paid Salaries Expense Rs. 2,000
18. ABC Ltd. records the following transactions for the year ending on March 31, 2023: Prepare
Journal and ledger
1. Plant purchased for Rs. 34,000/- through cheque on April 1, 2022.
2. Good sold for cash amounted Rs. 3,900/- on August 18, 2022.
3. Goods sold to MNP Ltd. on credit for Rs. 7,200/- on January 20, 2023.
4. Depreciation charged on Plant Rs. 3,400/- on March 31, 2023.
19. Mr. Anbu starts business with Rs.10,000 on the 10 th of January, 2019. Of this he paysRs. 9,000
into his bank account. His transactions during the month were as follows.Prepare cash book.
Jan. 5 Purchased office table and chairs for cashRs.1,250
Jan. 6 Sold goods for cash Rs10,000
Jan. 10 Paid for sigh board Rs.200
Jan. 12 Paid auto charges Rs.570
Jan. 14 Paid wages Rs.150
20.Journalize the following transaction.
1) Purchased goods for cash Rs.10000
2) Purchased stationery for cash Rs.500
3) Sold goods to Jane for cash Rs.3000
4) Paid salary Rs.8000
5) Paid freight on goods purchased Rs.300

PART C

1.Mr. Anbu starts business with Rs.10,000 on the 10 th of January, 2019. Of this he paysRs. 9,000
into his bank account. His transactions during the month were as follows.Prepare cash book.
Jan. 5 Purchased office table and chairs for cashRs.1,250
Jan. 6 Sold goods for cash Rs10,000
Jan. 10 Paid for sigh board Rs.200
Jan. 12 Paid auto charges Rs.570
Jan. 14 Paid wages Rs.150
2. What is accounting? What are its objectives?
3. What is book keeping? Distinguish between book keeping and accounting
4. Write a short note on
5. Accounting period concept b) Cost concept
6. Write a short note on a) Conservatism b) Full disclosure

7. Prepare accounting equation on the basis of the following

a) Ram started a business with Rs.100000
b) He purchased furniture for Rs.40000
c) He purchased goods on credit Rs.10000
d) He paid rent Rs.500
e) He sold goods (cost price Rs.4000) Rs.7000 for cash

8. Journalize the following transaction.

1) Purchased furniture for cash Rs.3000
2) Sold goods to James Rs.2000
 3) Paid rent to Krishnan, the landlordRs.800
4) Paid Lokesh, the manager his salary Rs.3000
5) Sold goods for cash Rs.8000
9. Enter the following transactions in the journal and ledger of Hari Prasad of Chennai.2000
July
1 Commenced business with cash Rs.180000
4 Purchased goods for cash Rs.22000
5 Deposited into bank Rs.55000
8 Cash sales Rs.16200
11 Cash deposited into bank Rs.23000
14 Purchased furniture for cash Rs.4000
20 Paid wages Rs.1800
29 Paid cash for stationery Rs.180
30 Paid cash for miscellaneousexpenses Rs.150

10. On March 1, 2020, Mr. Mohit started a Furniture business in GANDHI NAGAR Mr. Mohit
invested Rs 50,00,000.
March 2: Cash deposited into the bank: Rs. 30,00,000.
March 3: Goods purchased (3,000 chairs) for cash: Rs 8,00,000 at a 25% trade discount.
March 4: Machinery was purchased for cash of Rs. 5,50,000, and installation expenses of Rs. 50,000
were paid.
March 5: Computer Purchased paid by cheque for Rs. 50,000.
March 6: Goods sold (2,000 chairs) for cash: Rs. 7,00,000.
March 7: Carriage paid Rs. 18,000.
March 10: Goods purchased (1,000 tables) from Dinesh & Company: Rs. 12,50,000 at a 20% trade
discount.
March 12: Goods Sold( 500 Tables) to Mohit & Brother: Rs. 20,00,000 at 40% trade discount.
March 13: Investment purchased by check for Rs. 2,00,000.
March 15: The amount paid to Dinesh & Company by cheques was Rs. 4,00,000.
March 16: Furniture Purchased for office use and paid by cheque for Rs. 1,50,000.
March 17: Cash withdrawn for personal use: Rs. 40,000.
March 18 Cheques received from Mohit and brother Rs 8,00,000 were deposited into the bank on the
same day.
March 19 Goods purchased ( 1000 Tables) from Dinesh & company Rs. 10,00,000 at 20% trade
discount.
March 20: Goods sold for cash, Rs. 5,00,000.
March 21 Goods Sold ( 500 Chairs and 500 tables) to Mohit & Brother Rs.10,00,000 at 20% trade
discount.
March 22 Cash withdrawn from bank for office use Rs. 1,00,000.
March 23 Advertisement Expenses paid by cheque Rs. 1,20,000.
March 24 Insurance premium paid Rs. 20,000 by cheque.
March 25 Cash received from Mohit & brother Rs 2,00,000.
March 26: Cash paid to Dinesh & Company: Rs. 1,50,000.
March 27, the Commission received Rs. 20,000.
March 28: Wages paid: Rs. Rs.15,000.
March 29 Cash withdrawn for personal use Rs. 40,000.
March 30 Salary Rs 25,000, Rent Rs. 16,000 paid by cheque.
March 31 Depreciation charge on machinery Rs. 5,000.
March 31 Bank charges charged by bank Rs. 5,000.
March 31. Interest received on the investment Rs. 4,000.
 KARPAGAM ACADEMY OF HIGHER EDUCATION

(DeemedtobeUniversityEstablishedUnder Section3ofUGCAct 1956)

Coimbatore– 641021.

Faculty: Dr.K.Geethanjali (Assistant Professor)

Subject Name: Basic Accounting Sub. Code: 23CCU501
Semester: III Class: III B.Sc (IT)
Possible Questions
UNIT II
PART A
1. What are subsidiary books?
2. Name any four types of subsidiary books.
3. What is the purpose of the purchases book?
4. What type of transactions are recorded in the sales book?
5. What is the difference between sales book and sales return book?
6. What is a cash book?
7. Define a single column cash book.
8. Define a two column cash book.
9. What are the three columns in a three column cash book?
10. What is recorded in the petty cash book?
11. If a company returns goods to a supplier, which book is used?
12. Where would you record the credit purchase of goods?
13. Which book would you use to record a cheque received from a customer?
14. A discount allowed to a customer is recorded in which column of the cash book?
15. What type of subsidiary book is used for small daily office expenses?
16.Explain the differences between single column, two column, and three column cash books with
examples.
17.What is recorded in the sales returns book? Give an example with a journal entry.
18.List and explain any five types of subsidiary books used in business.
19.What is a cash book? How is it different from other subsidiary books?
20.What are the contents of a petty cash book and why is it maintained?

PART B
1.State one advantage of using subsidiary books.
2.Why are cash and bank transactions recorded together in a three-column cash book?
3.Explain the purpose of maintaining subsidiary books in accounting.
4.Differentiate between the purchases book and the purchase returns book.
5.Describe the features and advantages of the three-column cash book.
6.Discuss the importance of the two column cash book and explain the role of the discount column.
7.Illustrate with a specimen format any one of the following:
a) Purchases Book b) Petty Cash Book c) Three Column Cash Book (any one)
8. Enter the following transactions in a single cash book of suba1999 April
1 Commenced business with cash Rs.24000
5 Bought goods for cash Rs.6000
10 Goods sold for cash Rs.11200
13 Paid into bank Rs.2500
14 Sold goods to Ganasen on credit Rs.9000
15 Bought goods from Mohan on credit Rs.13600
20 Purchased furniture Rs.9600
 21 Purchased stationery Rs.160
23 Received cheque from Ganesan Rs.9000
25 Paid Mohan Rs.740
26 Received commission Rs.300
27 Paid telephone charges Rs.300
30 Drawn from bank Rs.3800
9. Anand started business with Rs.10000 on 1-7-86.of this, he pays Rs.9000 into his bank account.
Hiscash transactions during the first week were:July
1 Purchased stationery, paid cash 40
Purchased goods for cash 650
Purchased office table and chair 200
2 Cash sales 150
3 Received from Gopal, as advance for a consignment of goods 200
4 Paid Sethi &Co cash 140
5 Paid for sigh board 130
6 Cash sales 160
Purchased old typewriter300
10.Prepare a simple cash book from the following transactions of gopal
2000Jan.
1 Gopal started business with cash Rs16000
2 He bought goods for cash Rs10000
4 Sold goods for cash Rs200
5 Received cash from Manohar Rs720
10 Paid into bank Rs6000
12 Paid cash to honest Raj Rs430
15 Sold goods for cash Rs3000
17 Paid for stationery Rs30
19 Paid for office furniture Rs370
20 Received from Kalidas Rs1360
24 Paid for advertisement Rs180
26 purchased postage stamps Rs16
29 Paid rent Rs200
31 Paid electricity charges Rs30
PART C
1. Enter the following transactions in cash book with Discount and Cash columns
2018 Nov
1 Cash in hand Rs.390
5 Sold goods for cash Rs.6,420
6 Credit purchase from Varun Rs.4,350
10 Received from Mohan Rs.4,240
Discount allowed to him Rs.40
14 Paid for Electricity charges Rs. 250
16 Bought stationery Rs.336
19 Drew from bank for office use Rs.2,800
24 Paid cash to Varun Rs.4,300 in full settlement
29 Received cash from Velavan Rs.770
Discount allowed to him Rs.30
30 Paid salaries Rs.2,000
2) Enter the following transactions in rehan cash book with discount and cash column.1999
Jan 1 Cash balance 18500
3 Cash sales 33000
4 Paid dravid 15850
Discount allowed by him 150
13 Sold goods to manohar on credit 19200
15 Cash withdrawn for personal expenses2400
 16 Purchased goods from Charles on credit 14300
22 Paid into bank 22750
25 Cash received from manohar 19000
Allowed him discount 200
26 Drew a Cheque for office use 17500
27 Paid cash to saravanan 2950Discount received from him 50
28 Paid cash to Charles less discount 14200
29 Cash purchases 13500
30 Paid for advertisement 600
31 Paid salaries 12000
3) Prepare a simple cash book from the following transactions of Mr.Gopal of Chennai 2000 Jan
1 Mr.Gopal started business with cash 16000
2 He bought goods for cash 10000
4 Sold goods for cash 200
5 Received cash from manohar 720
10 Paid into bank 6000
12 Paid cash to honest Raj 430
15 Sold goods for cash 3000
17 Paid for stationery 30
19 Paid for office furniture 370
20 Received from kalidas 1360
24 Advertising 180
26 Purchased postage stamps 16
29 Paid rent 200
31 Paid electricity charges 30
4) Enter the following transactions in cash book with discount and cash column
2000 Jan 1 Cash in hand 390
5 Sold goods for cash 6420
6 Credit purchase from varun 4250
10 Received from mohan 4240Discount allowed to him 40
14 Paid for electricity charges 250
16 Bought stationery 336
19 Drew from bank for office ues 2800
24 Paid cash to varun rs.4300 in full settlement
29 Received cash from velavan 770Discount allowed to him 30
30 Paid salaries 2000
5) Enter the following transactions in a three column cash book1999Jan
1 Cash in hand 410Balance at bank 8920
2 Cash sales 4500
3 Paid into bank 4000
5 Purchased stationery 100
8 Paid Mahesh by cheque 280Discount received 20
12 Gave a cheque for cash purchase 1500
15 Drew for personal use 500
18 Received from Suresh, a cheque for rs.1970 in full settlement of account for
Rs.2000 and deposited it in bank.
6. Enter the following transactions in a simple cash book of shri Subramanian 1999 April
1 commenced business with cash 24000
5 Bought goods for cash 6000
10 Sold goods for cash 11200
13 Paid into bank 2500
14 Sold goods to Ganasen on credit 9000
15 Bought goods from Mohan on crdit 13600
20 Purchased furniture 9600
21 Purchased stationery 160
 23 Received cheques from Ganasen 9000
25 Paid Mohan 13600
26 Received commissions 740
27 Paid telephone rents 300
30 Drawn from bank 3800
7. Journalize the following transaction in a two column cash book.2007 June
1 Cash in hand 8900
3 Bought goods for cash 4300
5 Paid for wages 4100
7 Withdrew from bank for expenses 7500
7 Cash paid to yusuf 1950Discount allowed 50
10 Cash sales 13500
13 Received cash from Banwari lal 3900Allowed him discount 100
15 Purchased stationery from ram on credit 200
16 Paid for postage and stamps 150
18 Amount introduced as a capital 5000
21 Received cash from Rajesh 7840Allowed him discount 160
24 Paid cash for traveling expenses 120
26 Amount paid into bank2500
27 Cash paid to mukherjee 975Discount allowed by him 25
28 Credit purchase from Mohammed 3800
30 Cash purchase 1500
30 Paid salaries 2800
30 Deposited into bank all cash in excess of 2000
8.Record the following transactions for the month of January 1999 in the purchases book of
M/s Narain electronics:
Jan 4 20 black and white T.Vs @ Rs.5,200 per piece.
10 colour T.Vs @ Rs.12,000 per piece. Trade discount on all items @12%
Jan 10 Purchased from Mani Electronics :
12 vedio tapes @ Rs.600 per piece
8 Philips tape recorders @ Rs.2500 per Piece
9. Enter the following transactions in the purchases returns book of Hari who is dealing in
automobiles and post them into the ledger.2017
Jan. 5 Returned to Anand 5 clutch plates @ Rs. 200 each, not in accordance
with order.
Jan. 14 Returned to Chandran 4 brake shoes @ Rs. 200 each and 10 rear view mirrors
@350 each, due to inferior quality.
10.From the transactions given below, prepare the sales book of Kumar Stationery for
July 2017.
July 5Sold on credit to Saravana Traders of Sayalkudi
10 packs of A4 sheets @ Rs. 250 per pack
10 dozens of writing pads @ Rs. 850 per dozen
Less : 10% trade discount for both
July 8Sold to Raja for cash
15 packs of A4 sheets @ Rs. 250 per pack
July 20Sold to Mohan & Co. of Mudukulathur
5 white boards @ Rs. 2,200 each
10 dozens of writing pads @ Rs. 850 per dozen
July 23Sold on credit to Narayanan old motor car for Rs. 5,000
July 28Sold to Kumaran for cash 15 packets of marker pens @ Rs. 250 per packet
10. Difference between cash book with Discount and three columns Cash books.
 KARPAGAM ACADEMY OF HIGHER EDUCATION

(DeemedtobeUniversityEstablishedUnder Section3ofUGCAct 1956)

Coimbatore– 641021.

Faculty: Dr.K.Geethanjali (Assistant Professor)

Subject Name: Basic Accounting Sub. Code: 23CCU501
Semester: III Class: III B.Sc (IT)
Possible Questions
UNIT III
PART A
1. What is a trial balance used for in accounting?
2. State two types of errors that do not affect the trial balance totals.
3. Give an example of an error of omission.
4. What is the effect of an error of principle on the trial balance?
5. How would you rectify an error where wages paid were wrongly debited to Machinery Account?
6. What is the main purpose of preparing final accounts?
7. Mention two adjustments that are commonly made in final accounts.
8. What is the journal entry for closing stock adjustment?
9. Why is depreciation treated as an adjustment in final accounts?
10. Give the adjusting entry for accrued rent.
11. What does a Balance Sheet show?
12. State two differences between assets and liabilities.
13. Why is capital shown on the liabilities side of the Balance Sheet?
14. What is the treatment of outstanding expenses in the Balance Sheet?
15. State the accounting equation that forms the basis of a Balance Sheet.
16. What is a trial balance?
17. Name any two types of errors that do not affect the trial balance.
18What is the purpose of preparing a Trading Account?
19. Mention any two differences between a Profit and Loss Account and a Balance Sheet.
20. What is an adjustment in the final accounts?
PART B
Part B
1. Prepare trading account of Archana for the year ending 31-12-2018 from the
following information Rs.
Opening stock 80,000 Purchases 8,60,000
Freight inward 52,000 Wages 24,000
Sales 1,44,0000 Purchase return 10,000
Sales return 3,16,000 Closing stock 1,00,000
Import duty 30,000
2. Differentiate between trading and profit and loss account.

3. Prepare Trading and Profit and loss account from the information given below:
Opening stock Rs.3,600 Rent (Factory) Rs.400
Purchases Rs.18,260 Rent (Office) Rs.500
Wages Rs.3,620 Sales Returns Rs.700
Closing stock Rs.4,420 Purchase Returns Rs.900
Sales Rs.32,000 General Expenses Rs.900
Carriage on purchase Rs.500 Discount to customers Rs.360
Carriage on sales Rs.400 Interest from Bank Rs.200
4) What adjusting entries would you pass in regard to
1) Outstanding expenses 2) prepaid expenses
3) Depreciation 4) Income received in advance
5) What is a trading account? Give a specimen of trading account
6) What is a balancesheets? Why is it prepared? Give a specimen of balance sheets
7) Differentiate between profit and loss account and balance sheet.
8) Prepare trading account of Geetha for the year ending 31-12-99 from the following
information
Opening stock Rs.50000 Goods purchased during 1996 Rs.280000
Freight and packing on the above Rs.20000
Closing stock Rs.60000Sales Rs.380000
Packing expenses on sales for distribution Rs.12000
9) Prepare trading and profit and loss account from the following information
Opening stock 3600 Purchases 18260 Wages 3620
Sales 32000 Purchase return 900 Sales return 700
Closing stock 4420 Carriage on sales 400 Carriage on purchase 500
Rent (factory) 400 Rent (office) 500 General expenses 900
Discount to customers 360 Interest from bank 200
10) Pass necessary adjustment for the following transactions Trail balance
Salaries 1800 creditors 26600 Debtors 36000
Provision for doubtful debts 1000 Bad debts written off 1600
Adjustment:
1) Make a provision of 5% on debtors for doubtful debts and 2% discount on debtors
2) Make a provision of 5% on creditors
PART C

1 Prepare Trial Balance as on 31.03.2012 from the following balances of Ms. Maliha Afzal:
Drawings Rs. 74,800 Purchases Rs. 295,700 Stock (1.04.2011) Rs. 30,000
Bills receivable Rs. 52,500 Capital Rs. 250,000 Furniture Rs. 33,000
Discount allowed Rs. 950 Sales Rs. 335,350 Rent Rs. 72,500
Freight Rs. 3,500 Printing charges Rs. 1,500 Sundry creditors 75,000
Insurance Rs. 2,700 Sundry expenses Rs. 21,000 Discount received Rs. 1,000
Bank loan Rs. 120,000 Stock (31.03.2012) Rs. 17,000 Income tax Rs. 9,500
Machinery Rs. 215,400 Bills payable Rs. 31,700

2.The following is the balances of shri Gupta as on 30 th june 2007

Cash in hand Rs. 810 Cash at a bank Rs.3945

Purchases Rs.61013 Return inwards Rs.1020
Wages Rs.12720 Carriage on sales 4800
Fuel and power Rs.7095 Stock (1 st july, 2006) Rs. 8640
Carriage on purchases Rs.3060 Freehold land Rs. 15000
Buildings Rs.33000 Machinery Rs.30000
Rent Rs.13500 Investment Rs.15000
Salaries Rs.22500 General expenses Rs.4500
Insurance Rs.900 Drawings Rs.7868
Sundry debtors Rs.21750 Sales Rs. 148170
Return outwards Rs.750 Capital Rs.9300
Sundry creditors Rs.9450
Taking into account the following adjustment prepare the trading and profit and loss account and
balance sheets as on 30 th June, 2007
1) Stock on hand on 30 th june, 2007 is Rs.10200
2) Machinery is to be depreciated at the rate of 10% and patents at the rate of 20 %
3) Salaries for the month of June, 2007 amounting to Rs.2250 were unpaid
4) Insurance includes a premium of Rs.255 on a policy expiring on 31 st December 2007.
5) Bad debts are Rs.1088
6) Rent received in advance Rs.1500
7) Interest on investment of Rs.3000 is accrued.

3.The following is the balances of Shri Ganesh as on 30 th June 2008

Cash in hand Rs. 540 Cash at a bank Rs.2630

Purchases Rs40675 Return inwards Rs. 680
Wages Rs. 8480 Fuel and power Rs.4730
Fuel and power Rs.7095 Stock (1 st july, 2006) Rs. 5760
Carriage on purchases Rs.2040 Freehold land Rs. 15000
Buildings Rs. 22000 Machinery Rs.20000
Rent Rs.9000 Investment Rs.10000
Salaries Rs.15000 General expenses Rs.3000
Insurance Rs.600 Drawings Rs.5245
Sundry debtors Rs.41500 Sales Rs. 98780
Return outwards Rs.500 Capital Rs.62000
Sundry creditors Rs.6300 Carriage on sales Rs.3200
Patents Rs.7500

Taking into account the following adjustment prepare the trading and profit and loss account and
balance sheets as on 30 th June, 2007
1) Stock on hand on 30 th June, 2007 is Rs.6800
2) Machinery is to be depreciated at the rate of 10% and patents at the rate of 20 %
3) Salaries for the month of June, 2007 amounting to Rs.1500 were unpaid
4) Insurance includes a premium of Rs.170 on a policy expiring on 31 st December 2007.
5) Bad debts are Rs.725
6) Rent received in advance Rs.1000
7) Interest on investment of Rs.2000 is accrued.

4. Rectify the following errors

Credit sales of worth Rs. 4,500 was omitted to record in the book of original entry.
Wages and Salaries account should be separate to Rs. 15,000 and 10,000 respectively.
Drawing of worth Rs. 2,000 wrongly charged to Note Receivable Account.
Unearned Sales of Rs. 15,000 was incorrectly credited to Sales Account.

5) The following are the ledger balances extracted from the books of Karthik

Karthik capital 50000 Bank overdraft 8400 Sales 301000

Return inwards 5000 Furniture 5200 Business premises 40000
Creditors 26600 Opening stock 44000 Debetors 36000
Rent from tenents 2000 Purchases 220000 Discount(Cr) 800
Taxes and insurances 4000 General expenses 8000 Salaries 18000
Commission allowed 4400 Carriage on purchases 3600 Provision for doubtful debts
 1000
Bad debts written off 1600

Adjustments:
1) Stock on hand on 31-12-95 was estimated as Rs.40120
2) Write off depreciation on business premises RS.600 and furniture Rs.520
3) Make a provision of 5% on debtors for bad and doubtful debts
4) Allow interest on capital at 5% and carry forward Rs.1400 for unexpired insurance
Prepare final accounts for the year ended 31-12-1995

6) Prepare trading and profit and loss account and balance sheet from the following trail balances
of Madan

Debtors 92000 Rent rate taxes and insurance Conveyances allowances 1320
5600
Plant and machinery 20000 Opening stock 60000 Trade expenses 1350
Interest 430 Drawings 22000 Salaries 11200
Wages 7000 Advertisement 840 Business premises 12000
Sales returns 5400 Discount 600 Furniture and fixtures 10000
Purchases 150000 Bad debts 800 Cash in hand 2060
Capital 70000 Purchase returns 2600 Sales 250000
Sundry creditors 60000 Bank overdraft 20000

Adjustments:
1) Stock on hand on 31-12-96 was estimated as Rs.90000
2) Provide depreciation on premises at 2.5%; plant & machinery at 7.5% and
furniture and
fixtures at10%
3) Write off Rs.800 as further bad debts
4) Provide for doubtful debts at 5% on sundry debtors
5) Outstanding rent was Rs.500 and outstanding wages Rs.400
6) Prepaid insurances Rs.300 and prepaid salaries Rs.700

7. Explain the types of errors in accounting and describe how each type can be rectified with
suitable examples.
8. Prepare the final accounts of a sole trader from the given trial balance and adjustment entries.

9. What is a Trial Balance? Discuss its objectives and limitations. Also, explain what types of
errors it fails to detect.
10 . Differentiate between the Profit and Loss Account and the Balance Sheet in detail. Provide a
format for each.
 KARPAGAM ACADEMY OF HIGHER EDUCATION

(DeemedtobeUniversityEstablishedUnder Section3ofUGCAct 1956)

Coimbatore– 641021.

Faculty: Dr.K.Geethanjali (Assistant Professor)

Subject Name: Basic Accounting Sub. Code: 23CCU501
Semester: III Class: III B.Sc (IT)
Possible Questions
UNIT IV
PART A
1. What is depreciation?
2. Name any two causes of depreciation.
3. State any two methods of calculating depreciation.
4. Why is depreciation charged on fixed assets?
5. Mention any two factors affecting the amount of depreciation.
6. What is the Annuity Method of depreciation?
7. Why is interest considered in the Annuity Method?
8. Name one advantage and one limitation of the Annuity Method.
9. Which type of asset is best suited for the Annuity Method?
10. Hasan purchased a machine on 1st Jan. 1992 at Rs. 14,400. The scrap value after ten
years’ time is expected to be Rs. 3,400. If depreciation is written off by equal
installments every Dec. 31. Calculate the rate of depreciation.
11.What is the straight-line method of depreciation?
12. How is depreciation calculated under the straight-line method?
13. What is the written down value (WDV) method?
14. What is the main difference between straight-line and WDV methods?
15. What is the annuity method of depreciation?
16. What is the sinking fund method of depreciation?
17. What is a provision?
18. What is a reserve?
19. Difference between reserve and provision any two points.
20. A company acquired a machine on 1.1.88 at a cost of Rs. 40000 and spent Rs. 1000 on
its installation. The firm writes off depreciation at 10% on the diminishing balance. The
books are closed on 31st December of each year show the machinery A/c for 3 year

PART B
1.A machine was purchased for ₹50,000 on 1st April 2020. Its useful life is estimated to be 5
years with no residual value. Calculate depreciation for each year using the Straight Line
Method and show the Machinery Account for 2 years. Name any two causes of depreciation.
2.A firm purchased machinery worth ₹1,00,000. Depreciation is to be charged at 10% per
annum on the written down value. Calculate depreciation for the first 2 years and prepare the
Machinery Account.
3.Machinery was purchased on 1st April 2021 for ₹60,000. Depreciation is charged at 10%
p.a. on the original cost. On 1st October 2022, half of the machinery was sold for ₹25,000.
Calculate depreciation and profit or loss on sale
4.An asset costing ₹40,000 is depreciated at 10% p.a. on the Straight Line Method. Prepare
the Provision for Depreciation Account and Machinery Account for 3 years.
5.Describe the accounting treatment of depreciation and interest under the Annuity Method
with journal entries.
6.Distinguish between Annuity Method and Sinking Fund Method of depreciation (any 5
points).
7.A firm purchases a lease for ₹50,000 for 5 years. Depreciation is to be charged using the
Annuity Method at 5% interest. Calculate annual depreciation using the annuity table (given:
annuity of ₹1 for 5 years at 5% is ₹0.230975).
8. Write short notes on Reserve and Provision.
9. Explain any two methods of depreciation with suitable examples.
10. Differentiate between provisions and reserves. State any two examples of each.
PART C

1.On 1st April 2020, XYZ Ltd. purchased machinery for ₹2,00,000.
Depreciation is to be charged at 10% per annum on Written Down Value (WDV) method.
On 1st October 2022, a part of the machinery purchased on 1st April 2020, costing ₹50,000,
was sold for ₹30,000. The books are closed on 31st March every year.
You are required to: Calculate depreciation for each year.Show Machinery Account and
Depreciation Account for the years 2020–21, 2021–22, and 2022–23
2. On 1st April 2020, a firm purchased machinery for ₹1,00,000. On 1st April 2021,
additional machinery was purchased for ₹50,000. On 1st October 2022, machinery purchased
on 1st April 2020 costing ₹40,000 was sold for ₹20,000. Depreciation is charged at 10% p.a.
on original cost (SLM).
Prepare the Machinery Account and Depreciation Account for 3 years.
3. A machine was bought for ₹2,00,000 on 1st April 2020. On 1st October 2021, additional
machinery was purchased for ₹1,00,000. On 31st March 2023, machinery worth ₹50,000
(from the first purchase) was sold for ₹35,000. Depreciation is charged at 15% p.a. on WDV.
Prepare Machinery Account and calculate depreciation for each year.
4.Define amortization and explain its need in accounting for intangible assets. How is it
different from depreciation?
5.A second hand machine was purchased on 1-1-2010 for Rs. 30,000 and repair charges
amounted to Rs. 6,000. It was installed at a cost of Rs. 4,000. On 1st July 2011, another
machine was purchased for Rs. 26,000.On 1st July 2012 the first machine was sold for
Rs. 30,000. On the same day, one more machine was bought for Rs.25.000. On 31-12-
2012, the machine bought on 1st July 2011 was sold for Rs.23, 000. An account is
closed every year on 31stDecember. Depreciation is written off at 15% per annum.
Prepare the Machinery A/c for 3 years ending 31-12-2012 under straight line method
6.b A company whose accounting year is the calendar year, purchased on 1-1-93 a machine
for Rs. 40,000 it purchase further machinery on 1st Oct.1993 for Rs.20.000 and on 1st
July 1994 for Rs. 10,000 on 1-7-1995 ¼th of the machinery installed on 1-1-1993
become obsolete and was sold for Rs.6,800. Show how the machinery account would
appear in the books of the company for all the 3 year under diminishing balance
method depreciation is to be provided at 10% p.a.
7. Define depreciation. Explain the causes and need for providing depreciation in accounting.
8. Describe the straight-line method and written down value method of depreciation.
Compare their advantages and disadvantages.
9. Explain the annuity method and sinking fund method of depreciation. When are these
methods most appropriate to use?
10. What do you understand by provisions and reserves? Distinguish between the two with
examples.

KARPAGAM ACADEMY OF HIGHER EDUCATION

(DeemedtobeUniversityEstablishedUnder Section3ofUGCAct 1956)

Coimbatore– 641021.

Faculty: Dr.K.Geethanjali (Assistant Professor)

Subject Name: Basic Accounting Sub. Code: 23CCU501
Semester: III Class: III B.Sc (IT)
Possible Questions
UNIT V
PART A

1.What is a Receipts and Payments Account?

2.Is Receipts and Payments Account prepared on a cash or accrual basis?.
3.What type of balance does the Receipts and Payments Account usually show?
4.Does the Receipts and Payments Account include capital receipts?.
5.Is Receipts and Payments Account similar to a Cash Book?
6.What is an Income and Expenditure Account?.
7.Is the Income and Expenditure Account prepared on a cash basis?8.
8.What type of balance does the Income and Expenditure Account show?.
9.Is depreciation shown in the Income and Expenditure Account?
10.Is outstanding expense included in the Income and Expenditure Account?
11.What is the purpose of preparing a Balance Sheet in a non-profit organization?
12.What is Capital Fund in a non-profit organization’s Balance Sheet?
13.Are fixed assets shown in the Balance Sheet of a non-profit organization?
14.Is surplus or deficit transferred to the Balance Sheet?
15.What is the accounting equation represented by the Balance Sheet?
16.What is the purpose of a Balance Sheet in a Non-Profit Organization?
17.Does Receipts and Payments Account include non-cash items? Why or why not?
18. How does a Balance Sheet differ from the other two accounts?
19.Which account helps in finding the surplus or deficit of a Non-Profit Organization and how?
20. Which account shows only cash and bank transactions, and what is its objective?

PART B

1.Differences between Receipts & Payments Account, Income & Expenditure Account, and
Balance Sheet.
2.Distinguish between Receipts and Payments Account and Income and Expenditure Account.
3.Explain the features and importance of the Receipts and Payments Account in a Non-Profit
Organization.
4.What is an Income and Expenditure Account? State its main features and purpose.
5.Explain how the Balance Sheet of a Non-Profit Organization is prepared. What does it show?
6.Differentiate between capital and revenue items in the context of Non-Profit Organization
accounting.
7.ow do you treat the following in the final accounts of a Non-Profit Organization: subscriptions,
donations, and entrance fees?
8.Write the format of a Receipts and Payments Account and explain any four items appearing in
it.
9.karaikudi club is started1 1973,. During the year ended 31 dec 1973, its receipts and payments
were as under
Receipts:
Subscription Rs.3500, Donation Rs.1200
Payments:
Investment Rs.1500, Rent Rs.900, Printing and stationery 250, salary 360, postage 80, sundries
Rs.310
10. Explain the basis of accounting followed by professionals
PART C

1. From the following information of GG Organisation, calculate cash at bank at the end of the
year and prepare Receipts and Payment Account for the year ending 2021-22:
1. Balance at the beginning of the year,1-4-2021: Cash at Bank ₹43,200, Cash in Hand
₹17,940
2. Subscriptions received ₹6,750
3. Sundry payments:
Rent and Taxes ₹1,900
Printing and Stationery ₹3,160
Salaries ₹14,700
4. Sundry receipts:
Interest on Investment ₹5,500
Sale of Furniture ₹11,400
Bank Interest ₹800
5. Entrance fees received for the year 2021-22 ₹9,700
6. Balance at the end of the year,31-3-2022: Cash in Hand ₹21,870
2.What are the key differences between Income and Expenditure Account and Profit and Loss
Account?
3.Why is the Receipts and Payments Account not considered a final account? Explain with
reasons.
4. From the following information of GFG Club, prepare Receipts and Payment Account for the
year ending on 31st March, 2022. Cash at Bank at the year end was ₹1,97,300. Find Cash in
Hand at the year ending:
1. Balance on 1st April,2021: Cash at Bank ₹83,200 Cash in Hand ₹27,000
2. Subscriptions received ₹64,200 (including ₹11,100 for 2020-21 and ₹16,300 for 22-
23)
3. Special Subscriptions for Governor’s Party ₹49,000
 4. Sundry Receipts:
Locker rent ₹31,500
Sale of Old Newspapers ₹1,750
Profit from Entertainment ₹22,800
Rent realized from Club Hall ₹35,500
Interest received from Investment ₹8,000
5. Sundry Payments:
Salaries ₹28,000 (₹6,500 includes for 2020-21)
Postage and Stationery ₹2,020
Electricity charges ₹1,765
Purchase of Library Books ₹30,200
Expenses on Dance and Socials ₹1,980
6. Life Membership Fees ₹12,630 and Entrance fees ₹1,590 of the club
7. Investments purchased by the Organisation worth ₹20,000
8. Honorarium paid by the Organisation ₹3,050
5. The following is a summary of cash transactions of Happy Hearts Club for the year ending 31st
March 2025:
Particulars Amount (₹)
Opening Cash Balance 10,000
Subscriptions Receive 30,000
Donations Received 5,000
Salaries Paid 15,000
Rent Paid 5,000
Furniture Purchased 8,000
Closing Cash Balance ?
Adjustments:
• Subscription of ₹3,000 belongs to the previous year.
• Salaries outstanding for the year: ₹2,000.

6. The following information relates to Bright Future Sports Club for the year ending 31st March
2025:
Particulars Amount (₹)
Subscriptions Received 40,000
Rent Paid 10,000
Wages Paid 8,000
Donations Received 5,000
Honorarium to Coach 7,000
Stationery Purchased 3,000
Adjustments:
Subscriptions include ₹5,000 for next year.
Rent for one month (₹1,000) is still unpaid.
Wages include ₹2,000 for the previous year.
Donations are to be treated as capital (not revenue).
Prepare the Income and Expenditure Account for the year ending 31st March 2025.
7. Explain the procedure adopted for the preparation of an Income and Expenditure account from
a given receipts and payment account.
8. The following transactions relate to Green Earth Foundation for the year ending 31st March
2025:
Particulars Amount (₹)
Subscriptions Received 50,000
Rent Paid 12,000
Salaries Paid 18,000
Donations Received 10,000
Insurance Paid 4,000
Printing and Stationery Expenses 3,000
Sale of Old Newspapers (Income) 2,500
Adjustments:
Subscriptions received include ₹5,000 for the next year.
Salaries include ₹3,000 for the previous year.
Rent for one month (₹1,000) is unpaid.
The sale of old newspapers is considered as income for the year.

You are required to prepare the Income and Expenditure Account for the year ending 31st March
2025.
9.The following is the summary of transactions for Youth Welfare Association for the year
ending 31st March 2025:
Particulars Amount (₹)
Entrance Fees Received 12,000
Subscriptions Received 25,000
Salaries Paid 15,000
Rent Paid 6,000
Office Expenses 2,500
Donations Received 8,000
Adjustments:
Subscriptions include ₹4,000 for the next year.
Rent for two months (₹1,000) is unpaid.
Donations received are to be treated as capital (not revenue).
Prepare the Income and Expenditure Account for the year ending 31st March 2025.

10. The following transactions occurred during the year ending 31st March 2025 for Bright Star
Club:
Particulars Amount (₹)
Subscriptions Received 60,000
Rent Paid 15,000
Wages Paid 20,000
Donations Received 12,000
Stationery Purchased 5,000
Sale of Old Books (Income) 3,000
Adjustments:
Subscriptions received include ₹10,000 for the next year.
Wages include ₹5,000 for the previous year.
Rent for the next year (₹1,000) has been prepaid.
Donations received are to be treated as capital income (not revenue).
Prepare the Income and Expenditure Account for the year ending 31st March 2025.