Principles and Practice of Accounting - May 2022

1. (a) State with reasons, whether the following statements are True or False: @ A claim that an enterprise is pursuing through legal process, where the outcome is uncertain, is a Contingent Liability. ° (ii) At the end of the accounting year, all the nominal accounts of the ledger book are balanced. (ii) The specific due date excludes the addition of grace days to arrive at the due date. (iv) Any amount spent for replacement of worn out part of…

The Machinery Account of a Factory showed a balance of ₹ 95 Lakhs on 1* April, 2020. The Books of Accounts of the Factory are closed on 31st March every year and Depreciation is written off @ 10% per annum under the Diminishing Balance Method. On 1%* September, 2020 a new machine was acquired at a cost of = 14 Lakhs and = 44,600 was incurred on the same day as installation charges for erecting the machine. On 1st September…

5. The following is the trial balance of Mr. B for the year ended 31st March, 2021: Particulars Dr. Particulars Cr. Opening Stock: Sundry Creditors 1,75,000 Raw Material 5,25,000 | Purchase Return 17,500 Finished Goods 2,62,500 | Capital 3,50,000 Purchase of Raw Material | 17,50,000 | Bills Payable 84,000 Land & Building 3,50,000 | Long Term Loan 7,00,000 Loose Tools 1,05,000 | Provision for bad Plant and Machinery 1,05,000 | and doubtful debts 7,000 Investments 87,500 | Sales 29,75,000 Cash…