Level: Bachelor Semester-Spring Year: 2015
Programme: BHM Full Marks: 100
Course: Hospitality Accounting I Pass Marks: 45
Candidates are required to give their answers in their own words as far as practicable.
The figures in the margin indicate full marks.
Very Short Answer Questions
Attempt all the questions. 10*2
- Write major differences in between book keeping versus accounting.
- Explain the rules of Debit and Credit with example under Modern Approach.
- Point out Accounting Cycle/Process.
- Write major two differences in between Capital receipt and revenue receipt in accounting treatment.
- Calculate current assets from the following information.
Account receivable 50,000, Account payable 20,000, Cash in hand 15,000, Salary expenses 25,000, Prepaid expenses 5,000, Marketable securities 10,000, Bills receivable 10,000, Inventories 10,000, Preliminary expenses 10,000.
- Calculate the surplus amount to be transferred to be balance sheet from the given information:
Net profit Rs.100000
Dividend paid Rs.70,000
Transfer to General Reserve Rs.10,000
Beginning balance of retained earnings Rs.50,000
- Define Uniform System of Accounting in Lodging Industry (USALI).
- From the following transaction calculate cost of goods sold and gross profit.
Purchase Rs 1,00,000, Carriage Rs 5,000, Sales Rs 1,75,000, Opening stock Rs 50,000, Wages Rs 25,000 and Closing stock Rs 60,000.
- Calculate current ratio from the following:
Current Assets Rs 1,00,000 and current Liability Rs 50,000.
- What is an Annual report means?
Descriptive answer questions
Attempt any six questions. 6*10
- Following cash and banking transaction are given.
Chaitra 1: Cash in hand Rs 12,000 and at bank Rs 16,000.
Chaitra 2: Goods purchase of 3,000 and paid by cheque.
Chaitra 3: Goods sold for Rs 5,000.
Chaitra 5: Furniture Purchase of Rs 8,000
Chaitra 7: Cash deposited into the bank Rs 3,500.
Chaitra 9: Cheque Received from Govinda Rs 5,000.
Chaitra 11: Cash withdrew from the bank for personal use 2,000.
Chaitra 15: Rent paid Rs 800.
Chaitra 20: Paid to Suresh By cheque Rs 6,000.
Chaitra 1goods purchase from ABC company Rs 10,000.
Required: Prepare double column cash book with cash and bank column.
- Account balance at the beginning of the day 1st January 2016.
A/c Payable Rs 5,400, Office supplies Rs 5,100, Food sales a/c Rs 5,300, Hari a/c Rs 5,100, Capital a/c Rs 5,500, Cash Rs 6,000
Other transactions are as follows.
- Received cash from Hari Rs. 50
- Purchase food on cash Rs. 300
- Paid rent for the month of February Rs. 500
- Food sales on cash Rs. 700
- Paid accoubt payable Rs. 300
- Journalize the transaction
- Prepare the Ledger a/c
- Prepare trial balance
- The following adjusted trial balance of Everest Hotel is given to you:
|Debit Items||Amount||Credit Items||Amount|
|Land and Building||50,00,000||Common share Capital||60,00,000|
|Plant and Kitchen Equipment||15,00,000||Share Premium||8,00,000|
|Investment in shares||12,00,000||Bank loan||9,00,000|
|Cash balance||50,000||Account payable||1,00,000|
|Bank balance||2,50,000||Salary Payable||40,000|
|Inventory of food materials||80,000||Food and Beverage Revenue||43,00,000|
|Account Receivables||3,00,000||Room Revenue||21,00,000|
|Advance to Employees||2,40,000||Income from investment||1,00,000|
|Underwriting commission||60,000||Gain on sale of land||50,000|
|Cost of food and beverage sold||36,00,000|
|Interest on bank loan||1,20,000|
|Loss on sale of old furniture||10,000|
- Multi-step Income Statement.
- Statement of retained earnings.
- Classified balance sheet.
- The following income statement and balance sheet of Ratnagiri Resort is available to you.
Income Statement for the period 31st December 2015.
|Less: Cost of goods sold|
|Add: Other Income||1,00,000|
|Less: operating expenses|
|Administrative and general expenses||12,00,000|
|Selling and distribution expenses||9,00,000||21,00,000|
|Less: Depreciation expenses||2,00,000|
|Earnings before interest and tax||17,00,000|
|Less: Interest expenses||3,00,000|
|Income before tax||14,00,000|
|Less: Income tax||3,50,000|
|Net income after tax||10,50,000|
Balance sheet as on 31st December, 2015
|Common share capital@Rs.100 each||50,00,000||Land and Building||40,00,000|
|10% Preference share capital||10,00,000||Plant and Machinery||20,00,000|
|Retained earnings||10,50,000||Furniture and Fittings||8,00,000|
|Bonds payable||4,00,000||Cash balance||50,000|
|Account payable||2,50,000||Bank balance||5,50,000|
|Income Tax Payable||3,50,000||Stock||3,00,000|
|Rent Payable||1,50,000||Pre-paid salary||1,00,000|
i)Current ratio ii) Quick ratio iii) Debt equity ratio iv) stock turnover ratio v) Account receivable turnover ratio vi) Capital employed turnover ratio vii) return on assets viii) Return on common shareholder’s equity ix) Earnings per share x) Net profit margin
- Why do you think preparation of Income statement and Balance sheet is very important for every business organization? Explain what are the information you can get from there?
- The Louis V Hotel has 250-room facility with several profit centers. The hotel is open through-out the year, and generally about 2 percent of the rooms are being repaired or renovated at all times; therefore assume that rooms are unavailable for sale. During 2001, the hotel sold 76,400 rooms and experienced an average occupancy per-room of 1:42 people. The accounting department has supplied the following information concerning the food department:
Ending Inventory Rs. 35,000
Consumption by employees (free of charge) Rs. 5,000
Cost of food sales Rs.312,000
Food cost% 35%
Food Inventory turnover 12 times
- Paid occupancy rate for 2001
- Number of paid guests of 2001
- Beginning inventory of food
- Food sale
- Multiple occupancy percentages (assume that no more than two persons occupied a double room. The following balance sheets of Max Company are provided.
|Liabilities||Last year||This year||Assets||Last year||This year|
|Common share Capital||4,00,000||5,00,000||Land and building||7,00,000||3,00,000|
|Preference share Capital||3,00,000||1,00,000||Plant and Machinery||50,000||2,00,000|
|Account Payable||50,000||70,000||Cash and bank||1,20,000||2,00,000|
|Insurance payable||30,000||50,000||Pre-paid rent||20,000||30,000|
- Sales during the year Rs. 14,00,000
- Cost of goods sold Rs. 8,00,000
- Operating expenses Rs. 4,50,000 including depreciation Rs. 50,000
- Land and building sold during the year Rs. 4,45,000.
- Plant and machinery purchased during the year Rs. 1,55,000.
- Divided paid Rs. 50,000.
Required: Cash Flow Statement.
Case analysis 20
- The trial balance of Chhaimale Resort Pvt. Ltd is provided to you.
Trial Balance as on 31st December, 2015
|Debit Items||Amounts||Credit Items||Amounts|
|Business premises||1,00,00,000||Sales revenue|
|Kitchen equipment and utensils||40,00,000||Room revenue||20,00,000|
|Furniture and fittings||20,00,000||Food revenue||50,00,000|
|Cash and bank balance||5,00,000||Beverage revenue||70,00,000|
|Inventory of food materials||4,00,000||Other minor operating dept.||5,00,000|
|Account receivable||6,00,000||Common share capital||50,00,000|
|Other current assets||2,00,000||Preferences share||30,00,000|
|Cost of sales:||Retained earnings||15,00,000|
|Other minor operating dept.||5,00,000||Account payable||15,00,000|
|Payroll and related expenses:||Expenses payable||10,00,000|
|Room department||7,00,000||Other payable||1,20,000|
|Other minor operating dept||50,000|
|Other minor operating dept||20,000|
- Hotel has 50 double rooms and 100 single rooms. Double room is equivalent to 1.5 times of single room in terms of facilities and services.
- Hotel has normally 90% occupancy in season and only 40% in off season. For this purpose 40 weeks considered as season and 12 weeks as off season.
- During the year 4,998 rooms are occupied as complimentary.
- Food cover sold during the year 10,000.
- Income statement and balance sheet under USALI format.
- Calculate the following operating ratio;
- Average daily room rate
- Average food service check
- Food cost percentage
- Paid occupancy percentage
- Beverage cost percentage