Goods are normally sent on cost price to the consignee but some time the consignor makes the invoice at the selling price i.e. proforma invoice price. The idea is that consignee should not know the actual cost of the goods. In such cases the entries are made by the consignor in his books at the invoice price.
Here the goods are sent to the consignee at cost + 1/6th of invoice price
Cost of goods sent = Rs. 33,000
Let Invoice value of the goods sent = x = 33,000 + 1/6 of x
Or x – 1/6th of x = 33,000
Or 5/6th of x = 33,000
Or x = 33000 × 6/5 = Rs. 39,600

A Bank reconciliation is a process that explains the difference between the bank balance shown in an organisation’s bank statement, as supplied by the bank, and the corresponding amount shown in the organization’s own accounting records at a particular point in time. Such differences may occur, for example, because a cheque or a list of cheques issued by the organization has not been presented to the bank, a banking transaction, such as a credit received, or a charge made by the bank, has not yet been recorded in the organisation’s books, or either the bank or the organization itself has made an error

Sometimes the capital of the new partner is not given. He/she is required to bring an amount proportionate to his/her share of profit. In such a case, new partner’s capital will be calculated on the basis of adjusted capital of the existing partners.
Here the capital account of Ramesh and Suresh show the balance of Rs. 1,02,000 and Rs.73,000 respectively.
They admit Mahesh as a new partner for 1/5 share in the profits.
Mahesh’s capital is calculated as follows:
Total share = 1
Mahesh’s share in the profit = 1/5
Remaining share = 1 – 1/5 = 4/5
4/5 share of profit combined capital of Ramesh & Suresh = Rs. 1,02,000 + Rs. 73,000 = Rs. 1,75,000
Total Capital of the firm = Rs. 1,75,000 × 5/4 = Rs. 2,18,750
Mahesh’s capital for 1/5 share of profits = Rs. 2,18,750 × 1/5 = Rs. 43,750
Mahesh brings in Rs. 43,750 as his Capital

The original cost of an asset takes into consideration all of the costs that can be attributed to its purchase and to putting the asset to use. These costs can include such factors as the purchase price, repairs, commissions, transportation, appraisals, warranties and installation.

Thus repairs incurred to bring the second hand car bought to use and the registration cost together with
dealers commission will be capitalized and will be included in the total cost of the asset .

So the amount debited to the car account will be 15,000 + 1,000 + 500 + 1,200 = Rs. 17,700
Correct option is (a)

The combined capital of A and B = 10,000 + 8,000 = Rs. 18,000
This combined capital constitutes ¾th of the total capital
So total capital of the firm will be = 18,000 × 4/3 = Rs. 24,000
Thus C’s capital will be = 24,000 – 18,000 = Rs. 6,000
C has bought Rs. 8,000 as his share of capital. That means the surplus brought by him is Goodwill
Thus C’s share in Goodwill = 8,000 – 6,000 = Rs. 2000 which is the 1/3 rd of total goodwill.
And the total value of goodwill will be = 2,000 × 3 = Rs. 6,000

When a company acquires any asset, the purchase consideration can be settled either in cash or in any way as decided between the seller and the company. It may be settled by issuing shares in the company or debentures also.

In this problem G Ltd. purchased assets from H Ltd. for a book value of Rs. 7,50,000 and the consideration was paid by issue of shares of Rs. 100 each at a premium of 25%

The shares are being issued at a premium thus the value of each share issued will be 100 + 25% of 100 = 100 + 25 = Rs. 125
Total value of assets acquired = Rs. 7,50,000
Number of shares issued = total value of assets acquired/value per share = 7,50,000/125 = 6,000 shares

When a new partner comes into the business, old partners have to give him his profit share from their portion. Thus change in profit sharing ratio is an important aspect to be considered on reconstitution by admission. In academic accounting, change in profit sharing ratio can be presented in various ways. The existing partners may decide to change their profit sharing ratio for various reasons. When the profit sharing ratio is revised among existing partners, there ought to be a partial sacrifice of profit share by some partners in favour of others. The sacrifice of one or a group of partners becomes the gain of the remaining partners.

Following is the formula for calculating sacrificing ratio: Sacrificing ratio = Old ratio – new ratio Here A & B are partners in a business sharing profits and losses in the ratio of 7 : 3. They admit C as a partner. A sacrificed 1/7th share and B sacrificed 1/3rd of his share in favour of C. So the sacrificing ratio is given.

Super Profits are the profits earned above the normal profits. Under this method Goodwill is calculated
on the basis of Super Profits i.e. the excess of actual profits over the normal profits. Steps for calculating
Goodwill under this method are given below:
(i) Normal Profits = Capital Invested × Normal rate of return/100
(ii) Super Profits = Actual Profits – Normal Profits
(iii) Goodwill = Super Profits × No. of years purchased
Here: The capital investment in the firm throughout the above mentioned period has been Rs.1,00,000
and 15% is considered to be a fair return on capital.
Normal profits = 1,00,000 × 15% = Rs. 15,000
Average profit of the last three years = (15,000 + 20,000 + 25,000)/3 = 60,000/3 = Rs. 20,000
Super profits = 20,000 – 15,000 = 5,000
Goodwill = 5000 × 2 = Rs. 10,000

Debenture is a certificate/instrument acknowledging a debt. It is issued generally by a public company to individuals /institutions who lend it money (invest in their debentures)For an investor investing in a debenture is just like investing in a fixed deposit with the difference that while he can withdraw the amount invested in a fixed deposit any time he/she likes with a loss of interest.. He cannot do so with a debenture. The amount invested on a debenture will be repaid only on the expiry of the period for which the debenture has been issued. if the debentures were originally issued at a discount and redeemed at premium then the case of loss on issue of debentures arise.

Here A Co. issued Rs. 1,00,000 12% Debentures at 5% discount, redeemable at 5% premium after 10 years.
The discount on issue of debentures = 5% of 1,00,000 = Rs. 5,000
The premium on redemption of debentures = 5% of 1,00,000 = Rs. 5,000
Thus total loss on issue of debentures = 5,000 + 5,000 = Rs. 10,000