Practice Test 34
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X and Y are partners sharing profit and losses in the ratio of 2:1. On 1st January, 2009, Z is admitted with 1/4th share in profits with guaranteed amount of Rs. 25,000. The profits for the year ended 31st December, 2009 amounting to Rs. 76,000. The share of Y in the profits should be:

  • Solution

On 1st January, 2010, Vimal sold goods worth Rs.20,000 to Renu and drew a bill on Renu for 3 months. Renu accepted the bill and returned it to Vimal who discounted the bill with bank on 4th February, 2010 @ 15% per annum. The discounting charges will be:

  • Solution

    Discounting bills of exchange is a financial service, where the Bank purchases drawn bills, from the
    domestic trade transactions, confirmed in particular with an invoice - with right of recourse to you - and
    credits you with the amount of the bill of exchange less discount interest and additional costs related to
    the bill, accrued in advance from the discount date to the bill payment term.
    Here amount of the bill = Rs. 20,000
    The bill was accepted by Renu on 1st January but was discounted on 4th February so,
    Amount to be paid to bank on discounting at 15%pa = 20,000 × 15/100 × 2/12 = Rs. 500

A draws a bill of Rs.10,000 on B on 23rd December, 2009 for one month. The bill is accepted on 25th December, 2009 by B. The maturity date of the bill will be:

  • Solution

    The maturity date will be 25th January, 2010 (after 1 month).

On 1st January Shilpa owes Rs.10,000 and accepts a 3 months bill for the amount. On the date of maturity Shilpa, not being able to honour the bill. She paid Rs.4,000 cash and
requested to draw another bill for three months for the balance amount with interest @15% per annum. The amount of interest should be

  • Solution

    Sometimes, acceptor of a bill finds himself unable to meet his acceptance on the due date. So he may
    approach the drawer of the bill before the maturity date arrives, to cancel the old bill and draw a new bill
    with extended date. The acceptor in this case will of course have to pay interest for the extended period.
    Total amount of the bill = Rs. 10,000
    Amount paid in cash = Rs. 4,000
    Amount due = Rs. 6,000
    Interest for 3 months @ 15%pa = 6,000 × 15/100 × 3/12 = Rs. 225

Ram and Shyam enter into a joint venture. Both of them deposited Rs.65,000 and Rs.32,500 respectively into a joint venture. Goods were purchased for Rs.75,000 and expenses amounting Rs.10,950 were incurred. Goods sold for Rs.90,000 and goods unsold were taken over by Ram at an agreed value of Rs.2,700. The profit on joint
venture is:

  • Solution

Mr. A sent 250 units costing Rs. 10,000 each to Mr. B. Mr. B sold 150 units @ Rs. 14,200 per unit on credit and 75 units @ Rs. 14,000 for cash. Mr. B is entitled to a commission Rs.500 per unit. The amount of commission will be:

  • Solution

    Remuneration paid for services is called commission. Commission is always paid on sales.
    Here B is entitled to commission of Rs. 500 per unit
    Here total units sold by B = 150 units on credit + 75 units for cash = 225 units
    Thus the amount of commission will be = 225 × 500 = Rs. 1,12,500

Goods costing Rs. 4,80,000 were sent on consignment basis. Goods are invoiced at 125% of the cost price. The invoice price and the loading will be:

  • Solution

    Cost of goods sent on consignment = Rs. 4,80,000
    Invoice price = 125% of the cost price
    Thus invoice price = 125% of 4,80,000 = Rs. 6,00,000
    And the loading = invoice price – cost price = 6,00,000 – 4,80,000 = Rs. 1,20,000

On 1st February, 2010, a loan of Rs.10,000 was given @ 12% per annum. Interest was received for 3 months from February to April in April, 2010. In the financial statements of
the year ended 31st March, 2010 amount of accrued interest should be:

  • Solution

    Accrued interest receivable occurs when interest on an outstanding receivable has been earned by the
    company, but has not yet been received. Here interest from February to March is earned by the company
    but received in April.
    So the amount of accrued interest will be = 12% of 10,000 × 2/12 = Rs. 200

On 1.1.2010, a machine costing Rs. 10,000 and a piece of furniture costing Rs.20,000 was purchased. Depreciation is provided @ 5% p.a. on furniture and 10% per annum on
machine. The depreciation for the year ended 31st March, 2010 should be:

  • Solution

A’s acceptance to B for Rs. 10,000 renewed for 2 months on the condition that Rs. 4,000 be paid in cash immediately and the remaining amount will carry interest @ 12%
p.a. The amount of interest will be _________

  • Solution

    Sometimes, acceptor of a bill finds himself unable to meet his acceptance on the due date. So he may approach the drawer of the bill before the maturity date arrives, to cancel the old bill and draw a new bill with extended date. The acceptor in this case will of course have to pay interest for the extended period.
    Total amount of the bill = Rs. 10,000
    Amount paid in cash = Rs. 4,000
    Amount due = Rs. 6,000
    Interest for 2 months @ 12% pa = 6,000 × 12/100 × 2/12 = Rs. 120

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