Theory Base of Accounting — Account STD 11 Commerce — Question

On 31st March, 2023, Bank Statement of Gopal shows credit balance of ₹ 33,570
whereas Cash Book showed debit balance of ₹ 53,000.
It was observed that the differences were because of the following:
i. Cheques and drafts sent to the bank but not collected and credited, amounted to ₹ 7,900 while cheque for ₹ 2,000 was received unpaid.
ii. Three cheques drawn for ₹ 3,000; ₹ 1,500 and ₹ 2,000 respectively were not presented for payment till 30th April, 2023.
iii. Bank has paid a cheque of ₹ 10,000 but it has not been entered in the Cash Book and a cheque of ₹ 5,000 which was discounted with the bank was dishonoured by the drawee on the due date.
iv. Bank has charged ₹ 130 as its commission for collecting outstation cheques and had credited an interest of ₹ 100 in the account.
v. A wrong debit of ₹ 5,000 was made by the bank, which was reversed on 4th April, 2023. Prepare Bank Reconciliation Statement as on 31st March, 2023.

Explain the meaning of any three of the following terms:

1. Assets.
2. Capital.
3. Goods.
4. Drawings.
5. Trade Receivables.

Rectify the following errors:

1. Credit sales to Mridula ₹ 5,000 were recorded as ₹ 500.
2. Credit purchases from Nayna ₹ 8,000 were recorded as ₹ 800.
3. Goods returned to Priya ₹ 12,000 were recorded as ₹ 1,200.
4. Goods returned from Rashi ₹ 10,000 were recorded as ₹ 1,000.

On 31st December, 2014 the Cash Book of Gopal showed debit balance of ₹ 12,000. On comparing the Cash Book with the Pass Book, the following discrepancies were noted:-

1. Cheques were issued for ₹ 15,000, but of them cheques for ₹ 7,700 have not yet been presented.
2. Cheques for ₹ 8,000 were deposited in bank but of these cheques for ₹ 2,000 were not recorded in the Cash Book.
3. Cheques deposited in bank but not credited ₹ 3,800.
4. A cheque for ₹ 350 was paid into bank but bank credited the amount with ₹ 530 by mistake.
5. Bank received interest on debentures on behalf of Gopal amounting to ₹ 300.
6. It was also found that the total of one page on the payment side of the Cash Book was ₹ 4,520 but it was written on the next page as ₹ 5,420.

Prepare a Bank Reconciliation Statement.

Rectify the following errors:

1. Credit sales to Mohan ₹ 7,000 were recorded as ₹ 700.
2. Credit purchases from Rohan ₹ 9,000 were recorded. as ₹ 900.
3. Goods returned to Rakesh ₹ 4,000 were recorded as ₹ 400.
4. Goods returned from Mahesh ₹ 1,000 were recorded as ₹ 100.

Distinguish between Provision and Reserve on the following basis:

1. Basic Nature.
2. Purpose.
3. Effect on Taxable Profits.
4. Presentation in Balance Sheet.
5. Element of Compulsion.
6. Use for payment of dividend.

Elucidate the following statement:
‘Only cash transactions are recorded in Cash Book'.

Y owes X ₹ 4,000. On 1st January, 2019, Y accepts a 3 months bill for ₹ 3,900 in satisfaction of his full claim. On the same date, it was endorsed by X to Z in satisfaction of his claim of ₹ 3,980. The bill is dishonoured on the due date. Give the Journal entries in the books of X.

Enter the following transaction in a two column cash book

2013		Amt (Rs.)
Feb-01	Cash in hand	75,000
Feb-05	Paid to Kartik	15,000
	Discount allowed by Kartik	500
Feb-08	Goods purchased	20,000
Feb-10	Received from Parth	49,000
	Discount allowed to Parth	1,000
Feb-16	Goods sold	20,000
Feb-21	Paid to Aroha	14,750
	Discount allowed by him	250
Feb-28	Paid wages for the month	25,000
	Paid in full settlement of Rs. 20,000 to Amit	19,500

A Trial Balance disclosed a difference of ₹ 417 placed on the credit side of the Suspense Account. Later on the following errors were located:

1. Goods worth ₹ 200 purchased from Sohan had been posted to his account as ₹ 250.
2. A purchase of furniture for ₹ 500 was recorded in the Purchases Book.
3. Instead of crediting Gian’s Account with ₹ 512, it was debited with ₹ 215.
4. Goods worth ₹ 130 returned by Gian were entered in the Sales Book and posted therefrom to the credit of Gian’s Personal Account.

Pass the rectifying entries and prepare a Suspense Account.