# IGCSE Accounting Paper-2: Specimen Questions with Answers 40 - 42 of 189

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### Passage

King and Queen commenced business as partners on April 1st 2006. King contributed £ 80000 and Queen contributed £ 50000 as capital. Their profit sharing ratio was decided as 2: 1. During the year King withdrew £ 8000 and Queen withdrew £ 16000. King was also entitled for salary amounting to £ 12000. Interest on capital was paid@6 % . The profit of the firm after providing for salary and interest on capital was £ 24000.

## Question 40 (5 of 5 Based on Passage)

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### Write in Short

What will be the capital of King and Queen on 31st March 2007, if fluctuating capital accounts were maintained by the firm?

### Explanation

On 31st March 2007, capital of King is £ 104800 and capital of Queen is £ 45000 when the firm maintains fluctuating capital accounts.

 DATE PARTICULARS JF KING QUEEN DATE PARTICULARS JF KING QUEEN Drawings 8000 16000 Cash 80000 50000 Balance C/F 104800 45000 Salary 12000 Interest on capital@6 % 4800 3000 Profit & Loss appropriation in the ratio 2: 1 16000 8000 112800 61000 112800 61000

Profit = King =

Profit = Queen =

### Passage

Turbo & Co. forfeited 100 equity shares of £ 100 each held by Mr. Andy on 20th December 2011, for nonpayment of first call of £ 20 per share and final call of £ 30 per share. These shares were reissued to Mr. Candy on 31st December 2011, at a discount of £ 35 per share.

## Question 41 (1 of 5 Based on Passage)

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### Write in Short

What does Turbo & Co. do with the excess of amount in the share forfeiture account?

### Explanation

The amount in excess remaining in the share forfeiture account will be transferred to an account called as Capital Reserve account by Turbo & Co. The amount present in this account cannot be used by the company to distribute dividends to its share holders.

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