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Rancho Ltd. took… (Class 12 Accountancy SQP 2023-24, Q12)

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AccountancyCBSE Class 12 · Sample paper, session 2023-24 · 1 mark · MCQ

CBSE Class 12 Accountancy sample paper 2023-24: question 12

From the official CBSE sample question paper for 2023-24, section A, question 12, for 1 mark. Try it first; the hints and our step-by-step solution are below.

Q12 · 1 mark · MCQAccounting for Share Capital

Rancho Ltd. took over assets worth ₹20,00,000 from PK Ltd. by paying 30% through bank draft and balance by issue of shares of ₹100 each at a premium of 10%. The entry to be passed by Rancho Ltd for settlement will be :-

  1. (A)PK Ltd. Dr. 20,00,000; To Share Capital A/c 12,72,700; To Securities Premium A/c 1,27,270; To Bank A/c 6,00,000; To Statement of P&L 30 (Being settlement of amount due to vendors)
  2. (B)PK Ltd. Dr. 20,00,000; To Share Capital A/c 12,72,700; To Securities Premium A/c 1,27,270; To Bank A/c 6,00,030 (Being settlement of amount due to vendors)
  3. (C)PK Ltd. Dr. 20,00,000; To Share Capital A/c 12,72,700; To Securities Premium A/c 1,27,300; To Bank A/c 6,00,000 (Being settlement of amount due to vendors)
  4. (D)PK Ltd. Dr. 20,00,000; To Share Capital A/c 12,73,000; To Securities Premium A/c 1,27,300; To Bank A/c 5,99,700 (Being settlement of amount due to vendors)

Source: official sample paper from cbseacademic.nic.in (PDF). See it in the full Sample paper 2023-24.

Hints

Open one hint at a time and try again before the next.

Hint 1

Shares cannot be issued in fractions.

Hint 2

Whatever cannot be paid in whole shares is paid in cash.

Step-by-step solution

Each step shows the marks it earns, as an examiner would award them. Checked by an independent re-solve from the question paper.

  1. Bank draft = 30% × ₹ 20,00,000 = ₹ 6,00,000. Balance ₹ 14,00,000 is paid in shares of ₹ 110 each: 14,00,000 / 110 = 12,727.27, so 12,727 shares are issued (share capital ₹ 12,72,700, premium ₹ 1,27,270 = ₹ 13,99,970).

  2. The fraction of a share (₹ 30) is paid in cash, so Bank is credited ₹ 6,00,030. Option (B).

    1 mark

Answer: (B) PK Ltd. Dr. 20,00,000; To Share Capital A/c 12,72,700; To Securities Premium A/c 1,27,270; To Bank A/c 6,00,030

Where the marks are

  • Whole shares only; the ₹ 30 fraction paid in cash (1 mark)

Revise the chapter

Practise this chapterBoard-style questions from Accounting for Share Capital, one at a time, marked against the answer key and marking points.Back to the full paperSample paper 2023-24: every question, by section.

The question is transcribed from the official paper; figures are described in words. The solution, hints and chapter tag are ours. Spotted an error? Write tosupport@questionbuddy.in.