ECO-02

Bachelors Degree Programme (BDP)

ASSIGNMENT 2011-12

Elective Course in Commerce ECO-02: ACCOUNTANCY1

For January 2011 and July 2011 admission cycle

School of Management Studies Indira Gandhi National Open University Maidan Garhi, New Delhi-110 068

Elective Course in Commerce ECO-02: Accountancy1 ASSIGNMENT 2011-12

Dear Students, As explained in the Programme Guide, you have to do one Tutor Marked Assignment in this Course. Assignment is given 30% weightage in the final assessment. To be eligible to appear in the Term-end examination, it is compulsory for you to submit the assignment as per the schedule. Before attempting the assignments, you should carefully read the instructions given in the Programme Guide. This assignment is valid for two admission cycles (January 2011 and July 2011). The validity is given below: 1. 2. Those who are enrolled in January 2011, it is valid upto December 2011. Those who are enrolled in July 2011, it is valid upto June 2012.

You have to submit the assignment of all the courses to The Coordinator of your Study Centre. For appearing in June Term-end Examination, you must submit assignment to the Coordinator of your study centre latest by 30th April. Similarly for appearing in December Term-end Examination, you must submit assignments to the Coordinator of your study centre latest by 31st October.

Note : In case you receive the study material and assignments late, you can submit the assignment responses within one month after receiving the study material.

TUTOR MARKED ASSIGNMENT

Course Code Course Title Assignment Code Assignment Coverage : : : : ECO-02 Accountancy1 ECO-02/TMA/2011-12 All Blocks Maximum Marks : 100 Attempt all the questions 1. Define Accounting. Explain the following principles in detail. (i) (ii) (iii) (iv) 2. a) Business Entity Consistency Matching Full disclosure What will be the effect of the following on the Accounting Equation: (i) (ii) (iii) (iv) (v) b) Purchased goods for Rs. 20,000 from Mahesh on credit. Sold goods to Suresh costing Rs. 8,000 for Rs. 10,000 in cash. Paid Wages Rs. 500. Withdrew in cash for private use Rs. 2,000. Paid to Creditors Rs. 5,000. (10, 10) 3. a) Enter the following transactions in the Cash Book with Cash and Bank Columns: 2010 Rs. June 1 Cash in hand 800 Bank Overdraft 5,700 7 Received a Cheque from Bharti 3,250 9 Deposited the above cheque into bank 12 Paid to Bhavana by cheque 2,425 15 Bharatis cheque returned dishonored 20 Withdrew from Bank for office use 250 25 Cheque received from Panna Lal 1,200 28 Panna Lals cheque was endorsed in favour of Kamal 30 Income Tax paid by cheque 150 30 Bank charges 25 Explain the reasons on account of which the balance shown by the Pass Book does not agree with the balance shown by the bank column of the Cash Book. (10, 10)
3

(4 5)

Give the rule of Debit and Credit and explain them with imaginary examples.

b)

4.

a)

Trial Balance is not a conclusive proof of the accuracy of the books of accounts. Explain this statement and describe the errors which are not disclosed inspite of the agreement of trial balance. What are rectifying entries? How are two sided errors rectified? (10, 10)

b)

5.

Prepare Trading and Profit & Loss Account for the year ended 31 st December, 2010 and Balance Sheet as on that date from the following Trial Balance:Dr. (Rs.) Capital Cash Bank Overdraft Purchases and Sales Returns Office Expenses Taxes and Insurance Bad-debts and Bad-debt Provision Debtors and Creditors Commission Deposits Opening Stock Drawings Furniture BIR and B/P 1,500 12,000 1,000 2,200 500 500 5,000 4,000 3,000 1,400 600 3,000 34,700 2,000 15,000 2,000 Cr. (Rs.) 10,000

700 2,000 500

2,500 34,700

Adjustments: 1. 2. 3. 4. 5. 6. Salaries Rs. 100 and taxes Rs. 200 are outstanding but insurance Rs. 50 is prepaid. Commission Rs. 100 is received in advance for next year. Interest Rs. 210 is to be received on Deposits and Interest on Bank Rs. 300 is to be paid. Bad-Debts provision is to be maintained at Rs. 1,000. Depreciate furniture by 10% Stock on 31-12-2010 was valued at Rs. 4,500. (20)