The document appears to be an examination paper for a commerce and accountancy course, outlining instructions for candidates, including mandatory questions and answer formats. It includes various accounting concepts such as revaluation reserves, contingent liabilities, and preparation of trial balances and profit-loss accounts. Candidates are expected to demonstrate knowledge through detailed questions pertaining to financial situations and transactions.

1. MI 7 , ‘M2C -T.2
Serial No. E (F–DTN–M–DPBA)
COMMERCE AND ACCOUNTANCY
Paper—I
(Time Allowed : Three Hours) (Maximum Marks : 300
INSTRUCTIONS
Each question is printed both in Hindi and in English.
Answers must be written in the medium specified in the
Admission Certificate issued to you, which must be stated clearly
on the cover of the answer-book in the space provided for the
purpose. No marks will be given for the answers written in a
medium other than that specified in the Admission Certificate.
Candidates should attempt Question Nos. 1 and 5 which
are compulsory, and any three of the remaining questions
selecting at least one question from each Section.
Assume suitable data if considered necessary and indicate
the same clearly.
The number of marks carried by each question is indicated
at the end of the question.
Important : Whenever a Question is being attempted,
all its parts/sub-parts must be attempted contiguously.
This means that before moving on to the next Question
to be attempted, candidates must finish attempting all
parts/sub-parts of the previous Question attempted. This
is to be strictly followed.
Pages left blank in the answer-book are to be clearly struck
out in ink. Any answers that follow pages left blank may
not be given credit.
: ail- vft fielt- tiirrt< S 1d.0. pa-
vz Einir gl
••

2. SECTION—A
1. Answer the following in about 150 words each :-
12x5=60
(a) Discuss how the money value of non-monetary
consideration is determined for purpose of Service
Tax.
(b) What is revaluation reserve and how it is
created ? Discuss also the merits and demerits of
such action.
(c) Discuss contingent liabilities with examples.
Where would these items feature in the
financial statements of a firm ? What
happens when bills are discounted by a firm ?
Show the journal entries for such transactions.
(d) Discuss how the following streams of
revenues are recognised in an IT service
company :
(i) Software services
(ii) Time and materials contracts
(iii) Sale of user's licenses.
(e) Explain the financial parameters to be used to
evaluate post-merger performance.
2 (Contd.)
• •

3. s — 31j
1. 11 * 6t-1t (3T11* 150 vicq -4) ftfk4 :—
1 2x5=60
(so trar€T 171*EFR * Ted*
tc,-Lr fl f4tifftu fwla f? f4-4ff meff4
(a) Tr 4c-Lircti-f ti.-44 4441 g UZI]. 4-6 on TRI vIldi
g 11)+414hr119 * mbr *-4 II
*1'11'4 I
#141-EZT T1'11?4gI5 011 oof mit* I 7T *
1)--414 ft*TuT 4 ws-rfzu qT ticbor f ?
gitlfl? qt 1111441 wldr t th
TT 5 I ft ? 44 c+4161 mct .1-fa IA oil'
fter
wr smr“tlar w;-441 4 f)4--r (biro mar Errcr34
c4 tii-4-1Pcr f4im ,nrcir t :-
(1) 'th4td24(
(ii) C24 4-Fret 3r-€r
(Ill) dLitl 3.1.1Tr41 *T 1-4/4 I
(1) fir-oi< f urea *-ff * ftthIT 4-1144
t-14-1111Z I
3 (Contd.)
• •

4. 2. (a) Following are the balances and other accounting
information of SME and Co. as on 31st March
2012 :-
Particulars Amount
(in Rs.)
Power and Fuel 74,626
Sundry Creditors 1,13,400
Cash in hand 9,720
Material Purchases 7,22,025
Misc. expenses 24,000
Sundry debtors 2,61,000
Drawings 94,410
Salaries 2,23,972
Stores and spares 8,577
Other consumables 1,937
Furniture and Fixtures
(at depreciated value
as on 1-4-2011) 30,000
Freehold land 1,50,000
Opening Stock 1,03,680
Carriage paid on sales 57,600
Bank balance 47,340
4 (Contd.)
• •

5. 2. (31) 31 4-114, 2012 t SME s f)4--fgcr
aloe 74 star rid g :—
fddkut cr 1
(7. *)
AT( 7-4 ‘EN 74,626
f4f4u 1 41 c 1,13,400
-ienC 9,720
TrFrrir wzr 7,22,025
?AU c4-1 24,000
-r<rc 2,61,000
sirs-cui 94,410
d-r 2,23,972
TeRf 74 -1'rzrtf 8,577
art- r aiTp 1,937
4,41=4 74 fib-m-w4
(1-4-2011 mr witrff
tc-Lf 1) 30,000
itt-61c-s 1,50,000
9-rdINT- Hier 1,03,680
idcb4 'TT H iTrs-r trvr 57,600
1.1 4 I 47,340
5 (Contd.)
• •

6. Particulars Amount
(in Rs.)
Sales 17,78,040
Materials returned 9,000
Wages 1,88,640
Building materials 76,028
Plant insurance 10,800
Capital 12,78,000
Closing Stock 1,22,400
Plant & Machinery
(at depreciated value
as on 1-4-2011) 3,60,000
Buildings (at depreciated value
as on 1-4-2011) 5,40,000
Plant repairs 10,125
Carriage on purchases 36,720
Patents (at depreciated
value as on 1-4-2011) 1,35,000
Sales returns 12,240
Other Information :-
(1) Rates of depreciation on Plant and
Machinery, Patents, Furniture and Fixtures
and Buildings are 10%, 20%, 10% and 2%
respectively.
6 (Contd.)
• •

7. I
ftwa
ti14i
(T. -4)
17,78,040
9,0001-11(-1 td.144r
T4-0 1,88,640
`ITTff wrmit 76,028
10,800Ttit 4)r
12,78,000
1,22,400311:?.-MT 4-11(1
3,60,000
5,40,000
11:17 H
(1-4-2011 Q- gtfkid-
tR)
n9 (1-4-2011
4tc-44 TT)
(-Rix 10,125
'R Hid ITTT 36,720
T-7-4- (1-4-2011 TRrd
1,35,000tc-4.1
12,240RM-1 g3Tr Jim Twr
3TRI V-e/1/14, :-
(1) 3n1V-Lir Met -47 10%, 20%, 10% 2%
-(171---err: kat 1-141)1 0, W+74, -4(
ftwaisf our trr
7 (Contd.)
• •

8. (2) Unexpired insurance : Rs. 3,060.
(3) Salaries accrued but unpaid : Rs. 7,000.
(4) 5% of Debtors may not pay.
(5) Wages include Rs. 36,000 spent on
construction of an annexe to Buildings
completed on 30th June 2011.
Prepare a Trial Balance as on 31st March
2012 and draw up a Manufacturing and Profit
and Loss Account for the year ended 31st March
2012. 40
(b) M/s Anant Kumar are a registered dealer in
West Bengal. During the year ending on
31st March 2012 the firm's local purchases
from registered dealers of West Bengal amounted
to Rs. 12 lakh. The firm had also made purchases
from local unregistered dealers amounting to
Rs. 2 lakh. During the period the firm's
sales within West Bengal amounted to Rs. 8 lakh
and outside West Bengal Rs. 1.50 lakh. Applicable
rates for VAT (both for purchases and sales) and
CST are 13.5% and 2% respectively.
Pass necessary journal entries to record the
above transactions. 20
(Contd.)

9. (2) 3t-af *tr 4t4T : 3,060
(3) gebItil dc,1 : 7,000
(4) 14,1 5% 4ft-q7€1 TT4T9-
(5) 30-6-2011 3/41((-1 FP*
Nlifur 41 ITnt( 4R Tftr 36,000 -Q (14.Thc1
4q--fir 4 tiR411"cf
31-3-2012 4t HHiki X14 ala atsf Rrw
fThtfuf) our mit-5A (41m UM 31-3-2012 Th)- t
od4z- atilt a); 40
(4) 4-44 3f47-4 ti-8( rifit44 sprici ittr
g I 31-3-2012 HHlkf t4 gjC1 atf
EF4 Miry ittr alituf4+a1 4
12 ciio T+. 4fl1 k2trtzr cciN I +
2 or(4 -#r Wr4117 3fIttr # 341
Merq Met I ‘Ti. staftr 4 Tifis-44 4 th-4 TT fashu
8 97q U2TT 14D.94-1 €116( 1.50 Miter
_-,arr (4,44 74 144 tt fot) 41-ii CST
Tht ci 914141: 13.5% 74 2% g
3th c+4,161( arFarT 79ra. 3r4Thelli
*0-41 20
9 (Contd.)
••

10. 3. (a) (i) PET Limited manufactures household food-
grade containers of different sizes. It uses a
special type of polyethylene sheet for making
the body of the containers. The sheets are
purchased in large sizes. A particular size of
container requires 60 square inches of the
polyethylene sheet. The cost of 1 square inch
is Re. 0.50.
While running a batch of 10,000
containers it is found that 6,50,000 square
inches of sheets were consumed at Re. 0.60
per square inch.
Show detailed calculations of (a) Total
variance, (b) Price variance, (c) Quantity
variance, (d) Pure price variance, and (e)
Joint Price-quantity variance. 25
(ii) On the basis of your findings prepare a report
for top management who shall soon be
deciding on bonuses for operating executives.
Your report must contain evaluation of each
variance. 15
(b) "To arrive at a comprehensive opinion, the auditor
reviews evidence that may be classified into three
major groups." What are these groups and how
do you relate the components of the groups to
the purposes of the audit 7 20
10 (Contd.)
• •

11. 3. (31) ( ) PETiWilraIS 3rTtrIEC ERI 1-1I)I7
fsrm)' f4Hful *tor ft I as ft-Q * arra-Tilt
ITC ftrkIsi art fiR 41-0119. r
°mot g i tr“ f irrci arrt--R 4
g i cf, 14,4)Gr v*-R * i *ilk 60 -cr
ter EkTip-r*--R trrreu tr“ *et 31ra1I*ffr
trth g 1 1 1 kwripitd( tI5(
Mir child 0.50 it I 10,000 f'sQ *
grIgi TfIrT i 0.60 Mir
6,50,000 '11:PpIrItITT Thri Tzrzfrrr f+-Lrr
Inn I
TrIrrm *--k* — (30 11,c1
fce, (4) merrru rdIg9, (kr) 4112ii
*FM. Ugr (g) (Tcith
f gl 25
(ii) 31(g 31-trt -9-rfkR4 sirck zr( k;*3f'd
aart *T:44 .3=-4 gtsl-g FI)) Iq) Virg
as
gt tritrff9- mftrs-FW * 41 Tr
F*Tf--kur *-1-Trri
stirrer ft41 wt-4* *ckutit*
ch.) kikrreg-d *(4 art ?t-f1 art# t 15
(g) "witch TrZi ER z5,4 3i*ert; 3-ff krrg,it
*flt -P4kg cfi-r WIT EV 4 f431-7 - 14iirr r Hchnr
ft Wikir cil(c4 ft 1" 4 4kKg 4441 ft 3rfit 31T4
31-471 -3%74 4 kr4.v'f wrIft 4-olby c!-, (
(rt. g ? 20
I I (Contd.)
• •

12. 4. (a) (i) A HUF consists of Mr. A (Karta), Mrs. A
and a minor child. On 18th December 2011,
the Karta sets apart Rs. 5 lakh out of the
family fund for maintenance of his wife.
Mrs. A deposits the money in her name with
a bank at an interest rate of 9% p.a.
Discuss whether the interest income
will be clubbed with the income of HUF or
Mr. A or none. Justify your answer. 15
(ii) Mrs. X, who is an Arts graduate, holds
2,200 out of 10,000 equity shares of a
private limited company in which her husband
Mr. Y, who is also an Arts graduate, is working
as Chief Accountant at an annual salary of
Rs. 12 lakh. The ITO claims that the salary
income of Mr. Y shall be clubbed together
with the income of Mrs. X. Is the ITO correct?
Justify your answer. 15
(b) X YZ Ltd. offered for subscription 1 lakh
shares of Rs. 10 each at a discount of Re. 1 per
share. The subscription money shall be payable
as follows :-
Application : Rs. 2.50
Allotment : Rs. 4.00
First and Final call : Rs. 2.50
12 (Contd.)
• •

13. 4. (3T) (i) ti turf f*=-1 713-4R ft w4 ssft 'at'
3lirrth UtiT dtichi 3r4Zik *Tr
g I 18-12-2011 aicit 1:11-41*
ffiaf f ch7if 4 trItarT <plq 5 wr*-
T. a (a I 54brd't 43T' 4 3174 4m # 9%
arRf* wm at ITT 4 viitr *-Tr4
3TTEI tig N-d-rq4 i* oRyi Ther 3411(
atrarftff f tart 4, 311- 'at' *et 3tr7 4
attrat 1 -f€1 t **411 arrcr 3144 ,a71(
otteiJicr 491 15
(ii) 5411:1-th 1* 7* choir i--110cO g
11M MT*of ssft 'ark' *fi fk-a fkfitfl
*mt4)- * 10,000 wtor atv4 4 * 2,200
34:4T g I st en{ eft lm =kir t-110011 g,
Wg kat, il-arrlta14,It * v7 4(44 *-T (61
g tker-41 wrlitf* kaff 3TRI 12 oic4 g 1
3TTINT 3T%!ilt MT n141 P 541 41‘'
tsftwdi *rt atm 1/441,v err
W4T 31ITWT 3ftWitt (in ? 444 dx-1(
OA I cif-54 I 15
XYZ 4 trT io * 9T4*
atst * I clitor 3t9i 3TrN-4- 9t-onci 1*-4 1
aft-44N 41 W (.11.41. inkT9T%TiTt bra It 44
tiff :—
arr-d--7 : 2.50
3M2-9. : 4.00
3413 ed 3TfralT : 2.50
13 (Contd.)
• •

14. The issue was fully subscribed. The entire amount
of allotment money was received. When the
company made the first and final call, amount
from 100 shares was not received. Despite notices
and reminders under Articles of Association no
amount was forthcoming from the allottees. The
company finally decided to forfeit these shares.
Subsequently, the company reissued these shares
at Rs. 9 per share, fully paid.
Pass necessary journal entries to record
the above transactions. Show also an extract of
Balance Sheet. 30
SECTION—B
5. Answer the following in about 150 words each :-
12x5=60
(a) What is contingent capital '? Discuss the various
instruments used to generate it.
(b) Define and distinguish between gross working
capital and net working capital. Can a firm survive
with zero net working capital ?
(c) Discuss in brief the techniques of assets-liability
management in a commercial bank.
(d) Discuss Sharpe's ratio and Treynor's ratio for
evaluation of risk-return performance of Mutual
Fund's portfolio.
14 (Contd.)
• •

15. trg f4+ 41 744: 3rL4-4--fi- fzu I 31-14Tff Tkft
Trft-r Err? 1 1/4,14 cf11-1141 32P4 cr4 31-P'ff3T
LIN 11 (1 r *1- uiri ms'tar too styli q6
vuu 4M #1 urn siv-"zrzuTir( m-Eut cr,
ter 74 (41(Er rx ft4 4Th 'u4 33M:req'f 4
(I 3-Nr 4t I 3F-OT: ThPT-41 4 4tU
Aezcl (6(ur) .1,(4 ftzrri 4r4 1*-Erript
4, styli 41 9 T. 1RM" 319T r1 I9fATI-Prff ftzu.
4TITTE vEr
3t1' CIA6R. MCI 3f177? trr-41
et 1ft ,Td* Therr4 1 30
5. Act 150 Vicfa 1 31( tr4 :-
12x5=60
(30 TN-REr Eta Tzu P ? q.-114 * ERftrr 4 3u4 40-
ft-W9- ft=ttr-ir*tr'41
(q) chi et Eta our cou-Nita Eta met liliwur
74 5'74 3wa-T Ruf44 *tr44 1 4241 1;ch rff4 7Ft- I
.41Z c1114Vnef tta 31f -a 4 (6 k71- g ?
OT) t alf if,7 4-T 4 4T-Ezr-T-ftr-4 Hcl-t1
Tt4q ft444 ft"44
(c) Eht * WTI •Ctrft727- -90-41q fkulT-0
Tkr4if- 3TTLIM our
3TVM fltfirflt ‘fr; Z, 1
15 (Contd.)
• •

16. (e) Explain the effect of absorption costing
and marginal costing on net profit of a business
firm.
6. (a) A company's annual demand of materials is 10,000
units. Presently, the company is procuring these
materials at Rs. 10 per unit. A group of suppliers
are now willing to offer the following quantity
discounts :
Order size Discount
1-999 units No discount
1,000 units and above 10%
Ordering cost of the company is Rs. 50 per
order and the holding cost is 20% p.a.
Find out the particular order size where the
total cost is at its lowest. 30
(b) Why do companies resort to 'managing
earnings' ? Illustrate the techniques employed for
this purpose. 30
7. (a) Illustrate Operating Leverage and Financial
Leverage. What insights you get from these two
leverages ? What are their limitations ? 30
16 (Contd.)
• •

17. (Zr) cd.11c1fil th-4 mci4 ITT so:m ur dpid
our aura nl+Ici spira TqlSZ
6. (31) on 441 mfci a Hiq 10,000
Met g I a4-Pr 4, ti-wt 445 441(1 10
we vrt?r 1 (5r A I zgrfit-fif3 sr
aim f4Tffif+--ffZZT 4-iflr 4 3114
~? 8-zrRf :—
my-
8-ErR :—
34thr -Wr 3TWR q
1-999 ,,to5ar
1,000 7-4 3914 atru 10%
31T 9r t Th°1 (mid 50
arr-b-r m.tr 34 met oprd 20% arffs
¶9 cirn0 SI- -0-4 as faffice-
arrayr arwR rra Siftir I 30
imorET 31-1tiamt air ct+4 ti5kr Mt ?
er rThwir*f?3acitt-A' di(ur #Thd
calltozir StftirI 30
7. (31) rifta-T9- Tel U21TT ftVIW *)-
3ci5(ur #-IAJ cfflo4r SI-D-4- #
3triT =Nu f,lat 51or A ? aaal 4-44r
? 30
17
• •
(Contd.)

18. (b) "Higher capital requirements might induce banks
to seek higher returns in areas that are high risk
or outside their core business". Do you agree
with this observation ? Justify your answer with
suitable examples. 30
8. (a) From the information given below you are required
to value the business under Residual Operating
Income method :
(Rupees in lakh)
Particulars Actual Forecasts
2012 2013 2014 2015 2016
Net Operating
assets 2724 2915 3119 3337 3570
Operating
income 410 449 480 514 550
Required return of the business is
10.10%. Net operating assets are expected to grow
at 7% p.a.
As on date the business has net outside
liabilities of Rs. 1728 lakh. 40
(b) Critically examine with illustrations the role of
Credit Rating Agencies with particular reference
to their ownership structure and corporate
governance. 20
18 (Contd.)
• •

19. (4) "4A A Sty V) 4(Hr arru-T
4 3Jf 4k- 4 7 v157 dt4
T TT 39-* =14=1(.04 # g1' ' 44I 31111
Zei 31-4th- ff 4 464d g ? 3Ttr4 3,1( Tzrzi- r
dcdsol . 4 d444d 4-41--Q4- I 30
8. (m) f4-L-411 -4 3 * 33-rtrR IzE4 tur 1iR=11(4# 33m-
31'77:4 atclf-114 rzfif*# $tr4
(mita T. 4)
4 t'I 41ttif-446
arfrrh-d
2012 2013 2014 2015 2016
4Rgier
#L-tift4zr 2724 2915 3119 3337 3570
sirzr 410 449 480 514 550
<41414 41%7 1010% g 1 7%
arRfT met at 4 'sj- tirt-AT## ‘sig}#
tr1 3114e4r g
fOfu dt cLicRiizr -071 -115=1Ta 1728
g I 40
(4) J-1144 31-1 ---(41): Vr-+-1 T1 3-Ic?sk-clAcci
th-q4r our fkiffilT 911((4*149-Tisr 4-of 4 e46(ul
344-1-44ff4T Ar4-4 20
19
• •

20. N—DTN—M—DPBA)
al
Serial No.
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311 VI
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wq-qt %irk 3fift Trazor >f 1K4 wt.-7 lc', fir
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wrz- I ZW-dt rat * 4T f:M# dc10. a 3M
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Note : English version of the Instructions is printed on the
front cover of this question paper
20
• •