Q 1 Mention any two factors which give rise to goodwill of a firm.  (Marks 2)

Q 2 R and S are partners sharing profits in the ratio of 5 : 3. T joins the firm, R gives 1/4 of his share and S gives 1/5 of his share to the new partner. Find the new ratio.  (Marks 3)

Q 3 Write any three points of difference between equity share and a debenture.  (Marks 3)

Q 5 X Limited issued 12% debentures of Rs. 20,00,000 at 8% discount redeemable at par. Assume that the debentures are redeemed by drawing method in the following manner:

Prepare discount on issue of debentures account.  (Marks 5)

Q 8 K Limited has been registered with an authorised capital of Rs. 4,00,000 divided into 4000 shares of Rs. 100 each of which, 2000 shares were offered for public subscription at a premium of Rs. 5 per share, payable as under:
                       Rs
on application   10
on allotment     25 (including premium)
on first call       40
on final call       30
Applications were received for 3600 shares, of which applications for 600 shares were rejected; the rest of the applications were allotted 2000 shares on pro-rata basis. Excess application money was transferred to allotment.
All the monies were duly received except from Sundar, holder of 200 shares, who failed to pay allotted and first call money. His shares were later forfeited, and reissued to Shyam at Rs. 60 per share Rs. 70 paid up. Final call has not been made.
Pass necessary Cash Book and Journal entries in the books of K Limited.   (Marks 10)

Q 11 Compute cash from operations from the following details:  (Marks 3)

Q 12 Explain briefly the meaning and significance of (i) Operating ratio and (ii) Fixed assets turnover ratio.  (Marks 4)

Q 17 From the following information, prepare a cash budget for January, February and March, 1998 :

Estimated cash balance on 1 January 1998 Rs. 20,000. In January a new machinery is to be purchased at Rs. 40,000 on credit, to be paid in two equal installments in February and March.  (Marks 6