Accounting Paper-I Css-2014 Solution

Tariq Haroon · #1 Wednesday, December 17, 2014

ACCOUNTING AND AUDITING
CSS PAPER-2014

Solution Presented By: Muhammad Tariq

Solution –Q-2

PROFIT & LOSS A/C SUN COMPANY LTD ON 31.12.2013
PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
Opening Stock 50000 Sales 300000
Purchases 160000 Closing Stock 65000
Purchases Returns (1000)
Carriage in 4000
Gross Profit 152000 Gross Profit 152000
Salaries 45000 Discount Received 1500
Depreciation 39750 Bad Debts Recovered (Other Income) 500
Rent 34800
Director’s Fee 9000
Trade Expenses 9000
Bad Debts 2000+2500 4500
Interest on loan 4500+500 5000
Profit for the year before Tax 6950

TOTAL 154000 TOTAL 154000

PROFIT & LOSS APPROPRIATION A/C SUN COMPANY LTD ON 31.12.2013
PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
Dividend Paid 4500 Profit and Loss Balance Carried Forward 35000
Income Tax Provision 10000 Profit for the year 6950
Profit after appropriation 27450

TOTAL 41950 TOTAL 41950

BALANCE SHEET SUN COMPANY LTD ON 31.12.2013

PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
FIXED ASSETS CAPITAL & RESERVES
Furniture 15000-2250 12750 Share Capital 500000
Machinery 300000-27500 272500 Profit for the year 27450
Premises 200000-10000 190000 General Reserves 30000

CURRENT ASSETS CURRENT LIABILITIES
Bills Receivables 21000 Salary Payables 2500
Prepaid Insurance 1500 Interest on Bank loan Payable 500
Investment at book value 20000 Income Tax Payable 10000
Sundry Debtors 60000-12000 48000 Sundry Creditors 20000
Cash at Bank 9700 LONG TERM LIABILITIES
Stock 65000 10% Bank Loan 50000

TOTAL 640450 TOTAL 640450

Solution –Q-3

Current Ratio 140000/60000 2.33
Acid Test Ratio 100000/60000 1.67
Debt Equity Ratio 200000/200000 1.00
Gross Profit Ratio 84000/600000 14 %
Operating Ratio 551600/600000 (N-01) 91.93%

Note-01: CGS + Admin Exp + Selling Exp
516000+35600=551600
It can also be calculated as follows:
GP-NP= 84000-40000 = 44000
44000-8400* =35600
Markup on debenture/ Interest expense
* 6% X 140000 =8400

Solution –Q-5

REVALUATION A/C ON 31.12.2013

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Bad Debts 1000 Land & Building 6000
Balance brought down
Share of A 2800
Share of B 2800
Share of C 1400
7000 Stocks 2000
TOTAL 8000 TOTAL 8000

CAPITAL A/C OF MR. A ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 24000
Share from Reserve A/C 800
Share from Good-Will 4000
Share from Revaluation A/C 2800
Balance Carried Forward 45600 Cash Bring by Mr. A 14000

TOTAL 45600 TOTAL 45600

CAPITAL A/C OF MR. B ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 16000
Share from Reserve A/C 800
Share from Good-Will 4000
Share from Revaluation A/C 2800
Balance Carried Forward 30400 Cash Bring by Mr. B 6800

TOTAL 30400 TOTAL 30400

CAPITAL A/C OF MR. C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 12000
Share from Reserve A/C 400
Share from Good-Will 2000
Share from Revaluation A/C 1400
Balance paid by cash 15800
TOTAL 15800 TOTAL 15800

BANK A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 10000 Paid to Mr. C 15800
Cash brought by Mr. A 14000
Cash brought by Mr. A 6800

Closing Balance C/ Forward 15000
TOTAL 30800 TOTAL 30800

BALANCE SHEET SUN COMPANY LTD ON 31.12.2013

PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
FIXED ASSETS CAPITAL & RESERVES
Land & Building 36000 Capital
Share of A 45600
Share of B 30400 76000
Good Will 10000

CURRENT ASSETS CURRENT LIABILITIES
Stocks 12000 Sundry Creditors 10000
Bills Receivables 4000
Sundry Debtors 9000
Cash at Bank 15000

TOTAL 86000 TOTAL 86000

Solution –Q-6
MACHINERY A/C ON 31.12.2011

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening balance Machine-1 12150 Dep. for the year on Machine-1 1215
New Machine Purchased 500000 Dep. for the year on Machine-2 50000
Balance C/ Forward Machine-1 10935
Balance C/ Forward Machine-2 450000

TOTAL 512150 TOTAL 512150

MACHINERY A/C ON 31.12.2012

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening balance Machine-1 10935 Dep. for the year on Machine-1 1094
Opening balance Machine-2 450000 Dep. for the year on Machine-2 45000
Balance C/ Forward Machine-1 405000
Balance C/ Forward Machine-2 9841

TOTAL 460935 TOTAL 460935

On Jan-01-2013 the balance of Machine-1 was Rs. 9841
Depreciation up-to 30.06.2013 (N-1) Rs. - 608
Book Value on 01.07.2013 Rs. 9233
Sold for Rs. -8400
Loss on sale of Machine-1 Rs. 833

MACHINERY A/C ON 31.12.2013

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening balance Machine-1 9841 Dep. for the year on Machine-1 up-to 30.06.2013 608
Opening balance Machine-2 405000 Dep. for the year on Machine-2 (Note-2) 50000
Cash received on disposal of Machine-1 8400
Profit/Loss A/c 833
Balance C/ Forward Machine-2 355000
TOTAL 414841 TOTAL 414841

Note-01: as the cost of initial balance of machine is not given; we assume that the balance on 01.01.2011 as a cost of machine-01.
12150 X 10% X 6/12=608

Note-02: cost of Machine-02 was 500,000 and depreciation on it for 2013 is 10% of 500,000 that is Rs.50,000.

Solution –Q-7
CREDITORS A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Payments to creditors 100000 Opening Balance NIL
Closing Balance 120000 Credit Purchases 220000

TOTAL 220000 TOTAL 220000

DEBTORS A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance NIL Receipt from Debtors 140000
Credit Sales 250000 Closing Balance 110000

TOTAL 250000 TOTAL 250000

PROFIT & LOSS A/C OF HASSAN ON 31.12.2013
PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
Opening Stock Nil Total Sales 42000+250000 292000
Total Purchases 56000+220000 2760000 Closing Stock 20000
Expenses 22000

Gross Profit 14000 Gross Profit 14000
Depreciation on motor cycle 6000

Profit for the year 8000

TOTAL 14000 TOTAL 14000

CASH AT BANK A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance Purchase of Motor Cycle 60000
Capital 90000 Payments to creditors 100000
Cash Sales 42000 Cash Purchases 56000
Receipt from Debtors 140000 Expenses Paid 22000
Closing Balance 24000
TOTAL 272000 TOTAL 272000

BALANCE SHEET OF HASSAN ON 31.12.2013

PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
FIXED ASSETS CAPITAL & RESERVES
Motor Cycle 60000-6000 54000 Capital A/C 90000
Less Drawings -10000
Add P/L A/C +8000
88000
CURRENT ASSETS CURRENT LIABILITIES
Stocks 20000 Sundry Creditors 120000
Debtors/ Receivables 110000
Cash at Bank 24000

TOTAL 208000 TOTAL 208000

Solution –Q-8

Direct income

Markup earned 35000
Direct expenses

Markup expensed (37000)
Gross Loss (2000)

Indirect Income

Income from dealing in foreign currency 4500
Commission, exchange and brokerage 1200
Non-mark-up income 19000
Other income 22000
Gain on sale of securities 13000
Dividend income 5400 65100
Income before indirect expenses 63100
Indirect Expenses
Administrative expenses 16000
Bad debts written off 5000
Other charges 4700
Provision for diminution in investment’s value 7000
Provision against non-performing loans 2500
Other provisions 200 35400
Income before Tax 27700
Income tax provision 1500
Net Income 26200

waleedrana · #2 Monday, December 22, 2014

Q-5) how you calculated cash given by A and B to maintain bank balance and pay to C

Saleemulhaq · #3 Monday, January 05, 2015

Tariq Thank you very much, kindly you can post II if you have solved some questions.

Saleemulhaq · #4 Wednesday, January 07, 2015

Quote:

Originally Posted by Tariq Haroon

ACCOUNTING AND AUDITING
CSS PAPER-2014

Solution Presented By: Muhammad Tariq

Solution –Q-2

PROFIT & LOSS A/C SUN COMPANY LTD ON 31.12.2013
PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
Opening Stock 50000 Sales 300000
Purchases 160000 Closing Stock 65000
Purchases Returns (1000)
Carriage in 4000
Gross Profit 152000 Gross Profit 152000
Salaries 45000 Discount Received 1500
Depreciation 39750 Bad Debts Recovered (Other Income) 500
Rent 34800
Director’s Fee 9000
Trade Expenses 9000
Bad Debts 2000+2500 4500
Interest on loan 4500+500 5000
Profit for the year before Tax 6950

TOTAL 154000 TOTAL 154000

PROFIT & LOSS APPROPRIATION A/C SUN COMPANY LTD ON 31.12.2013
PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
Dividend Paid 4500 Profit and Loss Balance Carried Forward 35000
Income Tax Provision 10000 Profit for the year 6950
Profit after appropriation 27450

TOTAL 41950 TOTAL 41950

BALANCE SHEET SUN COMPANY LTD ON 31.12.2013

PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
FIXED ASSETS CAPITAL & RESERVES
Furniture 15000-2250 12750 Share Capital 500000
Machinery 300000-27500 272500 Profit for the year 27450
Premises 200000-10000 190000 General Reserves 30000

CURRENT ASSETS CURRENT LIABILITIES
Bills Receivables 21000 Salary Payables 2500
Prepaid Insurance 1500 Interest on Bank loan Payable 500
Investment at book value 20000 Income Tax Payable 10000
Sundry Debtors 60000-12000 48000 Sundry Creditors 20000
Cash at Bank 9700 LONG TERM LIABILITIES
Stock 65000 10% Bank Loan 50000

TOTAL 640450 TOTAL 640450

There is some mistake in your depreciation calculation please check
Machinery 10% (300000*10%)=30000
Furniture 15% (15000*15%)....= 2250
Premises 5% (200000*5%)....=10000
Total .............................. =42250

asddsa · #5 Friday, January 09, 2015

Quote:

Originally Posted by Tariq Haroon

ACCOUNTING AND AUDITING
CSS PAPER-2014

Solution Presented By: Muhammad Tariq

Solution –Q-2

PROFIT & LOSS A/C SUN COMPANY LTD ON 31.12.2013
PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
Opening Stock 50000 Sales 300000
Purchases 160000 Closing Stock 65000
Purchases Returns (1000)
Carriage in 4000
Gross Profit 152000 Gross Profit 152000
Salaries 45000 Discount Received 1500
Depreciation 39750 Bad Debts Recovered (Other Income) 500
Rent 34800
Director’s Fee 9000
Trade Expenses 9000
Bad Debts 2000+2500 4500
Interest on loan 4500+500 5000
Profit for the year before Tax 6950

TOTAL 154000 TOTAL 154000

PROFIT & LOSS APPROPRIATION A/C SUN COMPANY LTD ON 31.12.2013
PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
Dividend Paid 4500 Profit and Loss Balance Carried Forward 35000
Income Tax Provision 10000 Profit for the year 6950
Profit after appropriation 27450

TOTAL 41950 TOTAL 41950

BALANCE SHEET SUN COMPANY LTD ON 31.12.2013

PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
FIXED ASSETS CAPITAL & RESERVES
Furniture 15000-2250 12750 Share Capital 500000
Machinery 300000-27500 272500 Profit for the year 27450
Premises 200000-10000 190000 General Reserves 30000

CURRENT ASSETS CURRENT LIABILITIES
Bills Receivables 21000 Salary Payables 2500
Prepaid Insurance 1500 Interest on Bank loan Payable 500
Investment at book value 20000 Income Tax Payable 10000
Sundry Debtors 60000-12000 48000 Sundry Creditors 20000
Cash at Bank 9700 LONG TERM LIABILITIES
Stock 65000 10% Bank Loan 50000

TOTAL 640450 TOTAL 640450

Solution –Q-3

Current Ratio 140000/60000 2.33
Acid Test Ratio 100000/60000 1.67
Debt Equity Ratio 200000/200000 1.00
Gross Profit Ratio 84000/600000 14 %
Operating Ratio 551600/600000 (N-01) 91.93%

Note-01: CGS + Admin Exp + Selling Exp
516000+35600=551600
It can also be calculated as follows:
GP-NP= 84000-40000 = 44000
44000-8400* =35600
Markup on debenture/ Interest expense
* 6% X 140000 =8400

Solution –Q-5

REVALUATION A/C ON 31.12.2013

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Bad Debts 1000 Land & Building 6000
Balance brought down
Share of A 2800
Share of B 2800
Share of C 1400
7000 Stocks 2000
TOTAL 8000 TOTAL 8000

CAPITAL A/C OF MR. A ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 24000
Share from Reserve A/C 800
Share from Good-Will 4000
Share from Revaluation A/C 2800
Balance Carried Forward 45600 Cash Bring by Mr. A 14000

TOTAL 45600 TOTAL 45600

CAPITAL A/C OF MR. B ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 16000
Share from Reserve A/C 800
Share from Good-Will 4000
Share from Revaluation A/C 2800
Balance Carried Forward 30400 Cash Bring by Mr. B 6800

TOTAL 30400 TOTAL 30400

CAPITAL A/C OF MR. C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 12000
Share from Reserve A/C 400
Share from Good-Will 2000
Share from Revaluation A/C 1400
Balance paid by cash 15800
TOTAL 15800 TOTAL 15800

BANK A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 10000 Paid to Mr. C 15800
Cash brought by Mr. A 14000
Cash brought by Mr. A 6800

Closing Balance C/ Forward 15000
TOTAL 30800 TOTAL 30800

BALANCE SHEET SUN COMPANY LTD ON 31.12.2013

PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
FIXED ASSETS CAPITAL & RESERVES
Land & Building 36000 Capital
Share of A 45600
Share of B 30400 76000
Good Will 10000

CURRENT ASSETS CURRENT LIABILITIES
Stocks 12000 Sundry Creditors 10000
Bills Receivables 4000
Sundry Debtors 9000
Cash at Bank 15000

TOTAL 86000 TOTAL 86000

Solution –Q-6
MACHINERY A/C ON 31.12.2011

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening balance Machine-1 12150 Dep. for the year on Machine-1 1215
New Machine Purchased 500000 Dep. for the year on Machine-2 50000
Balance C/ Forward Machine-1 10935
Balance C/ Forward Machine-2 450000

TOTAL 512150 TOTAL 512150

MACHINERY A/C ON 31.12.2012

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening balance Machine-1 10935 Dep. for the year on Machine-1 1094
Opening balance Machine-2 450000 Dep. for the year on Machine-2 45000
Balance C/ Forward Machine-1 405000
Balance C/ Forward Machine-2 9841

TOTAL 460935 TOTAL 460935

On Jan-01-2013 the balance of Machine-1 was Rs. 9841
Depreciation up-to 30.06.2013 (N-1) Rs. - 608
Book Value on 01.07.2013 Rs. 9233
Sold for Rs. -8400
Loss on sale of Machine-1 Rs. 833

MACHINERY A/C ON 31.12.2013

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening balance Machine-1 9841 Dep. for the year on Machine-1 up-to 30.06.2013 608
Opening balance Machine-2 405000 Dep. for the year on Machine-2 (Note-2) 50000
Cash received on disposal of Machine-1 8400
Profit/Loss A/c 833
Balance C/ Forward Machine-2 355000
TOTAL 414841 TOTAL 414841

Note-01: as the cost of initial balance of machine is not given; we assume that the balance on 01.01.2011 as a cost of machine-01.
12150 X 10% X 6/12=608

Note-02: cost of Machine-02 was 500,000 and depreciation on it for 2013 is 10% of 500,000 that is Rs.50,000.

Solution –Q-7
CREDITORS A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Payments to creditors 100000 Opening Balance NIL
Closing Balance 120000 Credit Purchases 220000

TOTAL 220000 TOTAL 220000

DEBTORS A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance NIL Receipt from Debtors 140000
Credit Sales 250000 Closing Balance 110000

TOTAL 250000 TOTAL 250000

PROFIT & LOSS A/C OF HASSAN ON 31.12.2013
PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
Opening Stock Nil Total Sales 42000+250000 292000
Total Purchases 56000+220000 2760000 Closing Stock 20000
Expenses 22000

Gross Profit 14000 Gross Profit 14000
Depreciation on motor cycle 6000

Profit for the year 8000

TOTAL 14000 TOTAL 14000

CASH AT BANK A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance Purchase of Motor Cycle 60000
Capital 90000 Payments to creditors 100000
Cash Sales 42000 Cash Purchases 56000
Receipt from Debtors 140000 Expenses Paid 22000
Closing Balance 24000
TOTAL 272000 TOTAL 272000

BALANCE SHEET OF HASSAN ON 31.12.2013

PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
FIXED ASSETS CAPITAL & RESERVES
Motor Cycle 60000-6000 54000 Capital A/C 90000
Less Drawings -10000
Add P/L A/C +8000
88000
CURRENT ASSETS CURRENT LIABILITIES
Stocks 20000 Sundry Creditors 120000
Debtors/ Receivables 110000
Cash at Bank 24000

TOTAL 208000 TOTAL 208000

Solution –Q-8

Direct income

Markup earned 35000
Direct expenses

Markup expensed (37000)
Gross Loss (2000)

Indirect Income

Income from dealing in foreign currency 4500
Commission, exchange and brokerage 1200
Non-mark-up income 19000
Other income 22000
Gain on sale of securities 13000
Dividend income 5400 65100
Income before indirect expenses 63100
Indirect Expenses
Administrative expenses 16000
Bad debts written off 5000
Other charges 4700
Provision for diminution in investment’s value 7000
Provision against non-performing loans 2500
Other provisions 200 35400
Income before Tax 27700
Income tax provision 1500
Net Income 26200

Q7. Depreciation is 20%, your question is wrong recheck

saba mushtaq · #6 Friday, January 16, 2015

Quote:

Originally Posted by Tariq Haroon

ACCOUNTING AND AUDITING
CSS PAPER-2014

Solution Presented By: Muhammad Tariq

Solution –Q-2

PROFIT & LOSS A/C SUN COMPANY LTD ON 31.12.2013
PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
Opening Stock 50000 Sales 300000
Purchases 160000 Closing Stock 65000
Purchases Returns (1000)
Carriage in 4000
Gross Profit 152000 Gross Profit 152000
Salaries 45000 Discount Received 1500
Depreciation 39750 Bad Debts Recovered (Other Income) 500
Rent 34800

Director’s Fee 9000
Trade Expenses 9000
Bad Debts 2000+2500 4500
Interest on loan 4500+500 5000
Profit for the year before Tax 6950

TOTAL 154000 TOTAL 154000

PROFIT & LOSS APPROPRIATION A/C SUN COMPANY LTD ON 31.12.2013
PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
Dividend Paid 4500 Profit and Loss Balance Carried Forward 35000
Income Tax Provision 10000 Profit for the year 6950
Profit after appropriation 27450

TOTAL 41950 TOTAL 41950

BALANCE SHEET SUN COMPANY LTD ON 31.12.2013

PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
FIXED ASSETS CAPITAL & RESERVES
Furniture 15000-2250 12750 Share Capital 500000
Machinery 300000-27500 272500 Profit for the year 27450
Premises 200000-10000 190000 General Reserves 30000

CURRENT ASSETS CURRENT LIABILITIES
Bills Receivables 21000 Salary Payables 2500
Prepaid Insurance 1500 Interest on Bank loan Payable 500
Investment at book value 20000 Income Tax Payable 10000
Sundry Debtors 60000-12000 48000 Sundry Creditors 20000
Cash at Bank 9700 LONG TERM LIABILITIES
Stock 65000 10% Bank Loan 50000

TOTAL 640450 TOTAL 640450

Solution –Q-3

Current Ratio 140000/60000 2.33
Acid Test Ratio 100000/60000 1.67
Debt Equity Ratio 200000/200000 1.00
Gross Profit Ratio 84000/600000 14 %
Operating Ratio 551600/600000 (N-01) 91.93%

Note-01: CGS + Admin Exp + Selling Exp
516000+35600=551600
It can also be calculated as follows:
GP-NP= 84000-40000 = 44000
44000-8400* =35600
Markup on debenture/ Interest expense
* 6% X 140000 =8400

Solution –Q-5

REVALUATION A/C ON 31.12.2013

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Bad Debts 1000 Land & Building 6000
Balance brought down
Share of A 2800
Share of B 2800
Share of C 1400
7000 Stocks 2000
TOTAL 8000 TOTAL 8000

CAPITAL A/C OF MR. A ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 24000
Share from Reserve A/C 800
Share from Good-Will 4000
Share from Revaluation A/C 2800
Balance Carried Forward 45600 Cash Bring by Mr. A 14000

TOTAL 45600 TOTAL 45600

CAPITAL A/C OF MR. B ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 16000
Share from Reserve A/C 800
Share from Good-Will 4000
Share from Revaluation A/C 2800
Balance Carried Forward 30400 Cash Bring by Mr. B 6800

TOTAL 30400 TOTAL 30400

CAPITAL A/C OF MR. C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 12000
Share from Reserve A/C 400
Share from Good-Will 2000
Share from Revaluation A/C 1400
Balance paid by cash 15800
TOTAL 15800 TOTAL 15800

BANK A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 10000 Paid to Mr. C 15800
Cash brought by Mr. A 14000
Cash brought by Mr. A 6800

Closing Balance C/ Forward 15000
TOTAL 30800 TOTAL 30800

BALANCE SHEET SUN COMPANY LTD ON 31.12.2013

PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
FIXED ASSETS CAPITAL & RESERVES
Land & Building 36000 Capital
Share of A 45600
Share of B 30400 76000
Good Will 10000

CURRENT ASSETS CURRENT LIABILITIES
Stocks 12000 Sundry Creditors 10000
Bills Receivables 4000
Sundry Debtors 9000
Cash at Bank 15000

TOTAL 86000 TOTAL 86000

Solution –Q-6
MACHINERY A/C ON 31.12.2011

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening balance Machine-1 12150 Dep. for the year on Machine-1 1215
New Machine Purchased 500000 Dep. for the year on Machine-2 50000
Balance C/ Forward Machine-1 10935
Balance C/ Forward Machine-2 450000

TOTAL 512150 TOTAL 512150

MACHINERY A/C ON 31.12.2012

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening balance Machine-1 10935 Dep. for the year on Machine-1 1094
Opening balance Machine-2 450000 Dep. for the year on Machine-2 45000
Balance C/ Forward Machine-1 405000
Balance C/ Forward Machine-2 9841

TOTAL 460935 TOTAL 460935

On Jan-01-2013 the balance of Machine-1 was Rs. 9841
Depreciation up-to 30.06.2013 (N-1) Rs. - 608
Book Value on 01.07.2013 Rs. 9233
Sold for Rs. -8400
Loss on sale of Machine-1 Rs. 833

MACHINERY A/C ON 31.12.2013

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening balance Machine-1 9841 Dep. for the year on Machine-1 up-to 30.06.2013 608
Opening balance Machine-2 405000 Dep. for the year on Machine-2 (Note-2) 50000
Cash received on disposal of Machine-1 8400
Profit/Loss A/c 833
Balance C/ Forward Machine-2 355000
TOTAL 414841 TOTAL 414841

Note-01: as the cost of initial balance of machine is not given; we assume that the balance on 01.01.2011 as a cost of machine-01.
12150 X 10% X 6/12=608

Note-02: cost of Machine-02 was 500,000 and depreciation on it for 2013 is 10% of 500,000 that is Rs.50,000.

Solution –Q-7
CREDITORS A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Payments to creditors 100000 Opening Balance NIL
Closing Balance 120000 Credit Purchases 220000

TOTAL 220000 TOTAL 220000

DEBTORS A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance NIL Receipt from Debtors 140000
Credit Sales 250000 Closing Balance 110000

TOTAL 250000 TOTAL 250000

PROFIT & LOSS A/C OF HASSAN ON 31.12.2013
PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
Opening Stock Nil Total Sales 42000+250000 292000
Total Purchases 56000+220000 2760000 Closing Stock 20000
Expenses 22000

Gross Profit 14000 Gross Profit 14000
Depreciation on motor cycle 6000

Profit for the year 8000

TOTAL 14000 TOTAL 14000

CASH AT BANK A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance Purchase of Motor Cycle 60000
Capital 90000 Payments to creditors 100000
Cash Sales 42000 Cash Purchases 56000
Receipt from Debtors 140000 Expenses Paid 22000
Closing Balance 24000
TOTAL 272000 TOTAL 272000

BALANCE SHEET OF HASSAN ON 31.12.2013

PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
FIXED ASSETS CAPITAL & RESERVES
Motor Cycle 60000-6000 54000 Capital A/C 90000
Less Drawings -10000
Add P/L A/C +8000
88000
CURRENT ASSETS CURRENT LIABILITIES
Stocks 20000 Sundry Creditors 120000
Debtors/ Receivables 110000
Cash at Bank 24000

TOTAL 208000 TOTAL 208000

Solution –Q-8

Direct income

Markup earned 35000
Direct expenses

Markup expensed (37000)
Gross Loss (2000)

Indirect Income

Income from dealing in foreign currency 4500
Commission, exchange and brokerage 1200
Non-mark-up income 19000
Other income 22000
Gain on sale of securities 13000
Dividend income 5400 65100
Income before indirect expenses 63100
Indirect Expenses
Administrative expenses 16000
Bad debts written off 5000
Other charges 4700
Provision for diminution in investment’s value 7000
Provision against non-performing loans 2500
Other provisions 200 35400
Income before Tax 27700
Income tax provision 1500
Net Income 26200

For acid test ration you should deduct inventiry /stock from total current assets

muhammadnasrullah · #7 Sunday, January 18, 2015

Kindly check the solution

Net profit 400
Transfer to reserves 4000
Depreciation 16000
Increase in stock -400
Dec in creditors -3600
Total from op 16400

Investing
debtors -8000
Machinary -12000
Building -6000
Total -26000

Financing
share capital 10000

Net cash flow= 16400-26000+10000= 400
Starting cash 3000
cash at the end 3400

bismaa · #8 Sunday, January 18, 2015

[QUOTE=muhammadnasrullah;798277]Kindly check the solution

Net profit 400
Transfer to reserves 4000
Depreciation 16000
Increase in stock -400
Dec in creditors -3600
Total from op 16400

Investing
debtors -8000
Machinary -12000
Building -6000
Total -26000

Financing
share capital 10000

Net cash flow= 16400-26000+10000= 400
Starting cash 3000
cash at the end 3400

your question is right.

KHANSHAHRUKH · #9 Wednesday, January 28, 2015

Quote:

Originally Posted by Tariq Haroon

ACCOUNTING AND AUDITING
CSS PAPER-2014

Solution Presented By: Muhammad Tariq

Solution –Q-2

PROFIT & LOSS A/C SUN COMPANY LTD ON 31.12.2013
PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
Opening Stock 50000 Sales 300000
Purchases 160000 Closing Stock 65000
Purchases Returns (1000)
Carriage in 4000
Gross Profit 152000 Gross Profit 152000
Salaries 45000 Discount Received 1500
Depreciation 39750 Bad Debts Recovered (Other Income) 500
Rent 34800
Director’s Fee 9000
Trade Expenses 9000
Bad Debts 2000+2500 4500
Interest on loan 4500+500 5000
Profit for the year before Tax 6950

TOTAL 154000 TOTAL 154000

PROFIT & LOSS APPROPRIATION A/C SUN COMPANY LTD ON 31.12.2013
PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
Dividend Paid 4500 Profit and Loss Balance Carried Forward 35000
Income Tax Provision 10000 Profit for the year 6950
Profit after appropriation 27450

TOTAL 41950 TOTAL 41950

BALANCE SHEET SUN COMPANY LTD ON 31.12.2013

PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
FIXED ASSETS CAPITAL & RESERVES
Furniture 15000-2250 12750 Share Capital 500000
Machinery 300000-27500 272500 Profit for the year 27450
Premises 200000-10000 190000 General Reserves 30000

CURRENT ASSETS CURRENT LIABILITIES
Bills Receivables 21000 Salary Payables 2500
Prepaid Insurance 1500 Interest on Bank loan Payable 500
Investment at book value 20000 Income Tax Payable 10000
Sundry Debtors 60000-12000 48000 Sundry Creditors 20000
Cash at Bank 9700 LONG TERM LIABILITIES
Stock 65000 10% Bank Loan 50000

TOTAL 640450 TOTAL 640450

Solution –Q-3

Current Ratio 140000/60000 2.33
Acid Test Ratio 100000/60000 1.67
Debt Equity Ratio 200000/200000 1.00
Gross Profit Ratio 84000/600000 14 %
Operating Ratio 551600/600000 (N-01) 91.93%

Note-01: CGS + Admin Exp + Selling Exp
516000+35600=551600
It can also be calculated as follows:
GP-NP= 84000-40000 = 44000
44000-8400* =35600
Markup on debenture/ Interest expense
* 6% X 140000 =8400

Solution –Q-5

REVALUATION A/C ON 31.12.2013

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Bad Debts 1000 Land & Building 6000
Balance brought down
Share of A 2800
Share of B 2800
Share of C 1400
7000 Stocks 2000
TOTAL 8000 TOTAL 8000

CAPITAL A/C OF MR. A ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 24000
Share from Reserve A/C 800
Share from Good-Will 4000
Share from Revaluation A/C 2800
Balance Carried Forward 45600 Cash Bring by Mr. A 14000

TOTAL 45600 TOTAL 45600

CAPITAL A/C OF MR. B ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 16000
Share from Reserve A/C 800
Share from Good-Will 4000
Share from Revaluation A/C 2800
Balance Carried Forward 30400 Cash Bring by Mr. B 6800

TOTAL 30400 TOTAL 30400

CAPITAL A/C OF MR. C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 12000
Share from Reserve A/C 400
Share from Good-Will 2000
Share from Revaluation A/C 1400
Balance paid by cash 15800
TOTAL 15800 TOTAL 15800

BANK A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance 10000 Paid to Mr. C 15800
Cash brought by Mr. A 14000
Cash brought by Mr. A 6800

Closing Balance C/ Forward 15000
TOTAL 30800 TOTAL 30800

BALANCE SHEET SUN COMPANY LTD ON 31.12.2013

PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
FIXED ASSETS CAPITAL & RESERVES
Land & Building 36000 Capital
Share of A 45600
Share of B 30400 76000
Good Will 10000

CURRENT ASSETS CURRENT LIABILITIES
Stocks 12000 Sundry Creditors 10000
Bills Receivables 4000
Sundry Debtors 9000
Cash at Bank 15000

TOTAL 86000 TOTAL 86000

Solution –Q-6
MACHINERY A/C ON 31.12.2011

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening balance Machine-1 12150 Dep. for the year on Machine-1 1215
New Machine Purchased 500000 Dep. for the year on Machine-2 50000
Balance C/ Forward Machine-1 10935
Balance C/ Forward Machine-2 450000

TOTAL 512150 TOTAL 512150

MACHINERY A/C ON 31.12.2012

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening balance Machine-1 10935 Dep. for the year on Machine-1 1094
Opening balance Machine-2 450000 Dep. for the year on Machine-2 45000
Balance C/ Forward Machine-1 405000
Balance C/ Forward Machine-2 9841

TOTAL 460935 TOTAL 460935

On Jan-01-2013 the balance of Machine-1 was Rs. 9841
Depreciation up-to 30.06.2013 (N-1) Rs. - 608
Book Value on 01.07.2013 Rs. 9233
Sold for Rs. -8400
Loss on sale of Machine-1 Rs. 833

MACHINERY A/C ON 31.12.2013

PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening balance Machine-1 9841 Dep. for the year on Machine-1 up-to 30.06.2013 608
Opening balance Machine-2 405000 Dep. for the year on Machine-2 (Note-2) 50000
Cash received on disposal of Machine-1 8400
Profit/Loss A/c 833
Balance C/ Forward Machine-2 355000
TOTAL 414841 TOTAL 414841

Note-01: as the cost of initial balance of machine is not given; we assume that the balance on 01.01.2011 as a cost of machine-01.
12150 X 10% X 6/12=608

Note-02: cost of Machine-02 was 500,000 and depreciation on it for 2013 is 10% of 500,000 that is Rs.50,000.

Solution –Q-7
CREDITORS A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Payments to creditors 100000 Opening Balance NIL
Closing Balance 120000 Credit Purchases 220000

TOTAL 220000 TOTAL 220000

DEBTORS A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance NIL Receipt from Debtors 140000
Credit Sales 250000 Closing Balance 110000

TOTAL 250000 TOTAL 250000

PROFIT & LOSS A/C OF HASSAN ON 31.12.2013
PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
Opening Stock Nil Total Sales 42000+250000 292000
Total Purchases 56000+220000 2760000 Closing Stock 20000
Expenses 22000

Gross Profit 14000 Gross Profit 14000
Depreciation on motor cycle 6000

Profit for the year 8000

TOTAL 14000 TOTAL 14000

CASH AT BANK A/C ON 31.12.2013
PARTICILAR DR.
RS. PARTICILAR CR.
RS.
Opening Balance Purchase of Motor Cycle 60000
Capital 90000 Payments to creditors 100000
Cash Sales 42000 Cash Purchases 56000
Receipt from Debtors 140000 Expenses Paid 22000
Closing Balance 24000
TOTAL 272000 TOTAL 272000

BALANCE SHEET OF HASSAN ON 31.12.2013

PARTICILAR AMOUNT IN RS. PARTICILAR AMOUNT IN RS.
FIXED ASSETS CAPITAL & RESERVES
Motor Cycle 60000-6000 54000 Capital A/C 90000
Less Drawings -10000
Add P/L A/C +8000
88000
CURRENT ASSETS CURRENT LIABILITIES
Stocks 20000 Sundry Creditors 120000
Debtors/ Receivables 110000
Cash at Bank 24000

TOTAL 208000 TOTAL 208000

Solution –Q-8

Direct income

Markup earned 35000
Direct expenses

Markup expensed (37000)
Gross Loss (2000)

Indirect Income

Income from dealing in foreign currency 4500
Commission, exchange and brokerage 1200
Non-mark-up income 19000
Other income 22000
Gain on sale of securities 13000
Dividend income 5400 65100
Income before indirect expenses 63100
Indirect Expenses
Administrative expenses 16000
Bad debts written off 5000
Other charges 4700
Provision for diminution in investment’s value 7000
Provision against non-performing loans 2500
Other provisions 200 35400
Income before Tax 27700
Income tax provision 1500
Net Income 26200

Why you did not deduct amount of 1500 of "discount" from purchases?

muhammadnasrullah · #10 Saturday, January 31, 2015

Year 2012
paper 2
part cost accounting
question no 3
kindly someone make EPU

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