Level: Bachelor Semester-Spring Year: 2016
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
- Briefly explain about accounting.
- Define Going Concern Concept in accounting.
- If a company had total assets of 12,00,000 with current liabilities of Rs. 200,000 and long term liabilities of Rs. 600,000 then what will be the value of shareholder’s equity.
- What is trial balance? What are the objectives of preparing trial balance?
- Define capital expenditure with appropriate examples.
- What are the differences between reserve and provision?
- Prepare the statement of retained earnings for the Walt Disney Company:
Net Income for 2008 Rs. 1,850
Dividend declared and paid in 2008 412
Retained earnings, September 30, 2007 9,543
Retained earnings, September 30, 2008 10,981
- A hotel has 200 rooms. 70% of the available rooms are occupied throughout the year, out of which 10% is complementary and the room revenue is Rs 25,00,000. Calculate complementary occupancy percentage.
- What do you mean by financial statement analysis?
- Find out the value of dividend paid the year if a company had opening and closing retained earnings Rs. 250,000 and Rs. 500,000 respectively with net profit after tax during the year is Rs. 320,000.
Descriptive Answer Questions
Attempt any six questions. 6*10
11. Define accounting. Explain in brief the principles of generally accepted accounting principle.
12. From the following transaction of ABC Company prepare cash book with appropriate column.
a) Cash balance Rs. 50,000 and bank balance Rs. 100,000.
b) Cash withdrawn from bank Rs. 20,000 for official use and Rs. 5000 for personal use.
c) Received Rs. 49,500 from account receivable in full settlement of Rs. 50,000.
d) Goods purchased for Rs. 200,000 out of which Rs. 30,000 paid in cash, Rs. 70,000 by cheque and balance on account.
e) Sold goods for Rs. 100,000 and 50% received in cash and sign a one month promissory note for reminder.
f) Cash deposited into bank Rs.40,000.
g) Payment made to account payable Rs. 99,000 in full settlement.
h) Salary paid Rs.20,000.
i) Goods sold on account Rs.50,000.
j) Commission received Rs.10,000.
13. Reliable Home Repair Company completed the following transactions in June 2016.
June 1 The Company was organized and received Rs. 1,00,000 cash from the issuance of capital.
June 8 The Company borrowed Rs. 10,000 from a bank as a loan
June 15 Repairs service performed for a customer who agrees to pay within a month amounted to Rs. 5,400.
June 22 The Company paid Rs. 4,065 on its loan from the bank, including Rs. 4,050 of principal and Rs. 15 of interest.
June 30 Miscellaneous expenses incurred in operating the business were Rs. 3,825 and were paid in cash.
- Prepare journal entries for each transaction.
- Post each transaction to the appropriate T accounts.
- Prepare a trial balance dated June 30,2016.
- The trial balance of World Trade House Ltd is as follows:
14. World Trade House Ltd.
Trial Balance as on Dec 31, 2015
|Account Titles||Debit (Rs)||Credit (Rs)|
|Cash and cash equivalents||5,000|
|Property, Plant & Equipment, at Cost||30,000|
|Accumulated depreciation,Property, Plants& Equipment||3,000|
|Brands, trademark and goodwill||20,000|
|Advances on sales (deferred revenues)||6,000|
|Other current liabilities||5,000|
|Long term debt||10,500|
|Other noncurrent liabilities||9,500|
|Common stock Rs 100 par value||10,000|
|Retained earnings (Dec 31, 2002)||6,000|
|Additional paid in capital||1,000|
|Cost of goods sold||15,000|
|Selling and administrative expense||1,500|
|Gain on sales of machines||1,000|
- World Trade House Ltd’s Income Statement for the year ended 31 Dec, 2015 using a multiple step format.
- World trade House ltd’s statement of Retained Earning at the end of 31 Dec, 2015.
- World Trade House Ltd’s Classified Balance Sheet as of Dec 31, 2015.
- Sharma and Company is in the process of its cash follows for the year ended 30 June, 2016. An income statement for the year and comprehensive balance sheet follows:
For the year ended June 30, 2016 (In Rs)
Sales revenue 4,00,000
Cost of goods sold 2,40,000
Gross Profit 1,60,000
General and Administrative expense 40,000
Depreciation expense 80,000
Loss on sale of plat assets 10,000
Total expenses and losses 1,30,000
Income before interest and tax 30,000
Interest expense 15,000
Income before tax 15,000
Income tax expense 5,000
Net Income 10,000
|2016||2015 June 30|
|Total Current assets||1,82,000||1,77,000|
|Plant and equipment||5,75,000||5,00,000|
|Total Long term Asset||3,25,000||4,00,000|
|Other accrued Liabilities||50,000||45,000|
|Income tax payable||5,000||15,000|
|Total Current Liabilities||2,00,000||2,00,000|
|Long term bank loan payable||75,000||1,50,000|
|Total shareholder’s equity||2,32,000||2,27,000|
|Total liabilities and shareholder’s equity||5,07,000||5,77,000|
- Dividend of Rs 5,000 were declared and paid during the year.
- New plant assets were purchased for Rs 1,25,000 in cash during the year.
- Land was sold for cash at its book value.
- Plant assets were sold during the year for Rs 20,000 in cash. The original cost of the assets sold was Rs 50,000 and their book value was Rs 30,000.
- A portion of bank loan also repaid.
Required: Prepare a cash flow statement using direct method in operating activity section.
- Following balance sheet is given to you.
|Equity Share capital||800,000||Land and Building||700,000|
|Reserve and Surplus||400,000||Plant and Machinery||650,000|
|General Reserve||200,000||Cash Balance||150,000|
|10% Bonds payable||500,000||Bank Balance||200,000|
|Tax Payable||100,000||Account Receivable||200,000|
|Notes Payable||150,000||Pre-paid Insurance||150,000|
- Fixed assets turnover ratio is 4 times
- Net profit before interest and tax 25% of total sales
- Tax rate is 25%.
- Current Ratio
- Quick Ratio
- Debt-Equity Ratio
- Amount of Sales
- Inventory Turnover Ratio
- Average Collection Period
- Net Profit after Tax
- Return on Assets
- Return on Shareholder’s Equity
- Return on Capital Employed
17. What is an animal report? Discuss its major components.
Case analysis 20
- You given the following trial balance and other information:
|Particular||Dr.amount (Rs)||Particulars||Cr. Amount (Rs)|
|Cost of sales:||Sales Revenue:|
|Other Minor Operating Dept.||5,000||Laundry Service||1,00,000|
|Payroll and related expense:||Other Minor Operating Dept.||50,000|
|F&B Department||40,000||Retained Earning||40,000|
|Laundry service||15,000||General Reserve||20,000|
|Other Minor Operating Dept.||2,000||Share Premium||10,000|
|Administrative expense||20,000||Bonds payable||30,000|
|Marketing expense||15,000||Bank loan||40,000|
|Repair& maintenance||4,000||Account payable||10,000|
|Other expense:||Notes payable||15,000|
|Room||50,000||Income tax payable||5,000|
|F&B Department||15,000||Salary & other expense payable||10,000|
|Other Minor operating dept.||1,000|
|Repair & Maintenance||3,000|
|Land & building||4,00,000|
|Plat & machinery||3,00,000|
|Cash & Bank||20,000|
a) Hotel has 150 rooms and 10% of rooms are generally under maintenance throughout the year.
b) Normally 80% rooms are occupied during the year and among them, paid rooms are 30,000 during the year.
c) No of cover sold during the year were 5,000 covers.
d) No of guests stay during the year were 45,000
i) Prepare income statement and balance sheet under USALI format.
ii) Calculate the following ratios:
- Average Daily Room rate
- Revenue per Available Room
- Average Food service Check
- Food Cost Percentage
- Average Occupancy per Room