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BBS Financial Accounting and Analysis

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BBS First Year Financial Accounting and Analysis Question Paper 2082 (TU) – Solved

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Faculty of Management

2082

Bachelor of Business Studies

Financial Accounting and Analysis

MGT 211

Full Marks: 100

Candidates are required to give their answers in their own words as far as practicable. The figures in the margin indicate full marks.

"Section A"

Attempt All questions .

[10*2=20 ]

1.

What is financial accounting?

[2]
2.

Define realization concept of accounting?

[2]
3.

What is periodic inventory system?

[2]
4.

Write down the meaning of contingent liabilities.

[2]
5.

What is GAAP?

[2]
6.

Following information are provided:

Started business with cash Rs. 300,000 and stock Rs. 100,000.

Paid salary Rs. 195,000 including advance of Rs. 15,000.

Required: Accounting equation

[2]
7.

You are provided the following information:

Sales Rs. 150,000 Salary to staff Rs. 24,000
Dividend received Rs. 10,000 Income tax paid Rs. 2,000
Opening stock Rs. 20,000 Closing stock Rs. 30,000
Purchase Rs. 80,000 Depreciation Rs. 8,000

Required: Amount of value added. 

[2]
8.

Following transactions are given:

June 10: Purchased from R Furniture

  • 6 Sofa Set @ Rs. 20,000 each

  • 10 Chairs for Rs. 5,000

    (Trade Discount @ 10%)

June 25: Purchased from S Furniture:

  • 10 Tables @ Rs. 5,000 each

  • 10 Chairs @ Rs 4,000 each with trade discount @ 5%

Required: Purchase Book

[2]
9.

On 1st Baishak, A Grocery Shop borrowed Rs. 450,000 from a bank by signing a 3-months, 12% note payable. It paid the principal and interest at due date.

Required: Journal entries for issue and retirement of note.

[2]
10.

A Company issued Rs. 300,000 face value bond at discount of Rs. 30,000. The unamortized discount was Rs. 5,000 and the bond contains a call provision of Rs. 102.

Required: Gain or loss on early redemption of bond

[2]

"Section B"

Attempt any FIVE Questions .

[5*10=50]

1.

The following information is provided:

Current ratio 2 Current Liabilities Rs. 200,000
Prepaid expenses Rs. 48,000 Inventory Rs. 90,000
Debentures Rs. 200,000 Shareholder's equity Rs. 600,000

Operating profit of the year Rs. 100,000 being 10% of Sales.

Income tax is 25%

Required:

a. Net profit after tax

b. Amount of sales

c. Quick ratio

d. Inventory turnover ratio

e. Debt to total capital ratio

f. Return on shareholder's equity

g. Net profit margin

[10]
2.

A company provides you the following information related to inventories for the month of Chaitra.

Chaitra 1: Beginning inventory 500 units @ Rs.10 each

Chaitra 9: Purchased 1,000 units @ Rs.12 each

Chaitra 14: Sold 1,200 units @ Rs.15 each

Chaitra 18: Purchased 500 units @ Rs.13 each

Chaitra 24: Purchased 200 units @ Rs.11 each

Chaitra 31: Sold 500 units @ Rs.20 each.

Required:

a. Cost of goods sold, ending inventory and gross profit under weighted average costing method.

b. Cost of goods sold, ending inventory and gross profit under LIFO method

[10]
3.

(a) Following transactions are related to machinery:

Shrawan 1, 2078 A machinery was purchased for Rs. 400,000.

Chaitra 30, 2078 Second machinery was purchased for Rs. 200,000.

Poush 30, 2080 First machinery became absolute and sold for Rs. 300,000.

Depreciation charged @ 15% p.a. on original cost method.

Required: Machinery account for three years ending 31st Chaitra, 2080.

[10]
4.

(a) On Ashad 2081, Bank Statement disclosed a balance of Rs.16,000 and Cash Book showed the balance of Rs.14,800

i) Deposit in transit Rs. 1,900

ii) Outstanding cheques Rs. 1,000.

iii) Notes receivable and interest collected by the bank Rs.4,000 and Rs. 200 respectively.

iv) Cheque of Rs. 7,450 deposited by the company was recorded by the bank as Rs.7,350

v) A customer's cheque for Rs.1,500 was returned by the bank due to insufficient fund.

vi) A cheque for Rs. 7,800 paid by the bank was recorded as Rs. 7,600 by the company.

vii) Bank charge Rs.300 for the service provided by the bank.

Required: Bank Reconciliation Statement

b. Write down the meaning of bad debts. Also explain in brief the methods of estimating bad debts.

[10]
5.

"A lease is a legal contract under which one party agrees to pay rent properly owned by the other party." discuss.

[10]
6.

What is value added statement. Explain in brief the advantages of value added statement.

[10]

"Section C"

Attempt any TWO Questions .

[2*15=30 ]

1.

Following are the transaction of a company.

I. Started business with cash Rs. 800,000 in exchange of 8,000 shares of Rs. 100 each.

II. Deposited into bank Rs.300,000.

III. Took a bank loan of Rs. 100,000 @ 10% interest.

IV. Sold merchandise goods for Rs.300,000 on account.

V. Purchased merchandise goods for Rs.180,000 on account

VI. Paid Rs.10,000 for insurance premium.

VII. Received Rs.270,000 after deduction of 10% discount from the customers

VIII. Paid Rs. 170,000 in full settlement of Rs.180,000 by cheque.

IX. Paid electricity bill Rs. 5,000

X. Pre-paid office rent Rs.26,000 by issuing cheque.

Additional Information

a) Closing stock Rs, 20,000.

b) Prepaid rent expired Rs. 24,000.

c) Outstanding interest Rs.10,000

Required:

a. Journal entries for above transactions 

b. Accounts receivable and payable account 

c. Triple column cash book 

d. Adjusted Trial balance 

[15]
2.

The Balance Sheet and Income Statement of a company have been given below:

Liabilities Year I Year II Assets Year I Year II
Equity share capital 800,000 1,000,000 Land and building 300,000 340,000
Share premium 80,000 100,000 Plant and machinery 500,000 700,000
Bank loan - 200,000 Inventories 230,000 300,000
Accounts payable 180,000 160,000 Accounts receivable 220,000 250,000
Provision for taxation 50,000 60,000 Provision for doubtful debts (40,000) (30,000)
Profit and loss 140,000 280,000 Cash at bank 40,000 240,000
Total 1,250,000 1,800,000 Total 1,250,000 1,800,000

Particulars Rs. Rs.
Sales 1,000,000
Less: Cost of goods sold 600,000
Gross profit 400,000
Less: Operating expenses 100,000
Interest on bank loan 20,000
Depreciation on machinery 40,000
Provision for taxation 60,000
Loss sales of machine (Book value Rs. 60,000) 40,000 260,000
Net income 140,000

Required: Cash flow statement by using direct method

[15]
3.

a. What is accounting information? Who are the users of accounting information? Explain. 

b. Define source of documents. Write down the objectives of source of documents. 

[15]