Yearly Archives: 2022

TEXTBOOK QUESTION AND ANSWER:

Q1. How does the evolutionary perspective explain the biological basis of behaviour?
Answer:

• Evolution refers to gradual and orderly biological changes that result in a species from their pre-existing forms in response to their changing adaptation demands of their environment.
• Physiological and biological changes that take place as a result of evolutionary processes are so slow that they become visible after hundreds of generations.

Three important features of modem human beings include:

• A trigger and developed brain with increased capacity for cognitive behaviours (like perception, memory, thinking, reasoning, etc).
• Ability to walk upright on two legs and
• Free hands with a workable opposing thumb.

The environmental demands had to biological and behavioral changes over a long period of time. In the human brain, the earliest to the most recent structures in the process of evolution are: Limbic system, brain stem and cerebellum are the oldest; and cerebral cortex is the latest developed.

Q2.Describe how neurons transmit information.
Answer:  Neuron is the basic unit of our nervous system. Neurons are specialized cells which convert various forms of stimuli into electrical impulses. They receive information from sense organs or from adjacent neurons, carry them to the central nervous system and bring motor information from the central nervous system to motor organs. Neurons transmit information with the help of dendrites, soma, axon and terminal buttons by converting stimuli into electrical impulses. This is done by the following method:  Dendrites —> soma —> axon —> terminal buttons

• Dendrites receive the informing neural impulses from adjacent neurons or directly from sense organs.
• The nerve impulse is then passed on the main body of the neuron i.e. soma.
• From soma the impulse is passed on to the axon.
• The axon transmits the information/impulse along its length to terminal buttons.
•  The terminal buttons transmit the information to another neuron, gland or muscle.

Q3. Name the four lobes of the cerebral cortex. What functions do they perform?
Answer : Four lobes of the cerebral cortex are:
(1) Frontal lobe (3) Temporal lobe
(2) Parietal lobe (4) Occipital lobe
Functions of these four lobes are following:

1. Frontal lobe:
   • Frontal lobe is mainly concerned with cognitive functions, such as attention,thinking, memory, learning, and reasoning.
   • It also exerts inhibitory effects on autonomic and emotional responses.
2. Parietal lobe: The Parietal lobe is mainly concerned with cutaneous sensations and their coordination with visual and auditory sensations.
3. Temporal lobe:
   • Temporal lobe is primarily concerned with the processing of auditory information.
   • Memory for symbolic sounds and words resides here.
   • Understanding of speech and written languages depends on this lobe.
4. Occipital lobe:
   • Occipital lobe is mainly concerned with visual information.
   • It is believed that interpretation of visual impulses, memory for visual stimuli and colour visual orientation is performed by this lobe.

Q4. Name the various endocrine glands and the hormones secreted by them. How does the endocrine system affect our behaviour?
Answer: Name and functions of the endocrine glands are following:

• The chemical substances secreted from the endocrine are known as HORMONES. These hormones influence the functions of the body and the course of its development and in the growth of personality.
• Endocrine glands also control and regulate the individual’s behaviour, for instance, when there is extra-supply of sugar in the blood-stream, certain ductless glands secrete insulin which reduces the sugar level in the blood to normal state.
• Endocrine glands play role in co-ordinating the body activities. Like in sudden , fear or danger, secretion from the endocrine system is mixed with blood which brings widely diverse activities to help us face this situation.
• The different endocrine glands work intimately to maintain equilibrium and coordinate body functions. For instance, if one gland is secreting more than optimum, the other gland may secrete a hormone to reduce the excess hormone and maintain equilibrium.

Q5. How does the autonomic nervous system help us in dealing with an emergency situation?
Answer:  The autonomic nervous system helps in dealing with emergency situations with the help of its two divisions : Sympathetic division and Parasympathetic division.

• Sympathetic division deals with emergencies when the action must be quick and powerful, such as in situations of fight or flight. During this period, the digestion stops, blood flows from internal organs to the muscles and breathing rate, oxygen.supply, etc. increases.
• Parasympathetic division is mainly concerned with the conservation of energy. It monitors the routine functions of the internal system of the body. When the emergency is over the sympathetic activation calms down the individual to a normal condition. As a result, all body functions like breathing rate, oxygen supply, etc. return to their normal level.

Q6.Explain the meaning of culture and describe its important features.
Answer: 

Culture: Culture refers to widely shared customs, believes, values, norms, institutions and other products of a community that are transmitted socially across generation.

• Culture refers to “the man-made part of the environment.”
• It comprises diverse products of the behaviour of many people, including ourselves. These products can be material objects (e.g. tools, sculptures), ideas (e.g. categories, norms) or social institutions (e.g. family, school).
• Culture may be defined as a shared way of life of a group of socially interacting people and is transmitted from generation through socialization and related processes.

Important features of culture are following:

• Culture includes behavioural products of others who preceded us. It indicates both substantial and abstract particulars that have prior existence in one form or another.
• It contains values that will be expressed and a language in which to express them.
• Culture characterized by sharing reflects presence and experience of cultural attributes psychologically.
• Cultural involves transmission of learned behaviour from one generation to the other within a community.

Q7. Do you agree with the statement that ‘biology plays an enabling role, while specific aspects of behaviour are related to cultural factors’? Give reasons in support of your answer.
Answer:  No doubt those biological factors do play enabling in determinants human behaviour. Biological factors basically set the limits but our behaviour is more complex then the behaviour of animal.

• Major reason for the complexity is the role of culture to regulate human behaviour.
• We can explain the concept with the help of two example hunger is a basic need of human beings as well as of animals but the way this need is gratified by human beings is extremely complex.

Different people in different cultures eat different things in a different manner e.g. directly with hand or with the help of spoons, forks and knives.

• Sexual behaviour can be taken as another example sex is a physiological need. The structure and functioning is determinant by biological mechanism but it expression is different in different culture.
• At the human level, we find evidence for a dual inheritance theory. Biological inheritance takes place through genes, while cultural inheritance takes place through memes.
• The former takes place in a “top-down” manner (i.e. from parents to children)., while the latter many also take place in a “bottom-up” manner (i.e. from children to parents). Dual inheritance theory also shows that although biological and cultural forces may involve different processes, they work as parallel forces, and interact with each other in offering explanation of an individuals behaviour.

Q8. Describe the main agents of socialisation.
Answer:  Socialization is a process of social learning through which a child acquires the norms, attitudes, beliefs and behaviours that are acceptable in his/her culture.
Main agents of socialization are following:

1. Parents:
   • Parents have the most direct and significant impact on children’s development.
   • Parents encourage certain behaviours by rewarding them verbally (e.g. praising).
   • They also discourage certain behaviours through non-approving behaviours.
   • The conditions of life in which parents live (poverty, illness, job stress, nature of family) also influence the styles they adopt in socializing children.
2.  School:
   • In schools children learn not only cognitive skills (e.g. reading, writing, doing mathematics) but also many social skills (e.g. way of behaving with elders and age mates, accepting roles, fulfilling responsibilities).
   • Several other positive qualities such as self-initiative, self-control responsibility, and creativity are encouraged in schools.
3.  Peer-Groups:
   • Friendship provides children not only with a good opportunity to be in company of others, but also for organizing various activities (e.g. play) collectively with the member of their own age.
   • Qualities like sharing, trust, mutual understanding, role acceptance and fulfillment develop on interaction with peers.
   • Development of self-identity is greatly facilitated by the peer groups.
4.  Media-Influences:
   • The exposure to violence on television enhances aggressive behaviour among children.
   • In recent years media has also acquired the property of a socializing agent therefore children learn about many things from newspapers, television, books and cinema.

Q9. How can we distinguish between enculturation and socialisation ? Explain.
Answer:  Enculturation refers to all learning that takes place without direct, deliberate teaching.

• It refers to all learning that occurs in human life because of its availability in our socio-cultural context.
• Observation is the key element of enculturation
• The contents are culturally shaped by our preceding generations. A major part of our behaviour is the product of enculturation.
• Socialisation is a process by which individuals acquire knowledge, skills and dispositions, which enable them to participate as effective members of groups and society.
• It is a process that continues over the entire life-span, and through which one learns and develops ways of effective functioning at any stage of development. Socialisation forms the basis of social and cultural transmission from one generation to the next.

Q10. What is meant by acculturation? Is acculturation a smooth process? Discuss.
Answer:  Acculturation refers to cultural and psychological changes resulting from contact with . other cultures. Contact may be direct (e.g. when one moves and settles in a new culture) or indirect (e.g. through media or other means). It may be voluntary (e.g. when one goes abroad for higher studies, training, job, or trade) or involuntary (e.g. through colonial experience, invasion, political refuge).

• Changes due to acculturation may be examined at subjective and objective levels.
• At the subjective level, changes are often reflected in people’s attitude towards change. They are referred to as acculturation attitudes.
• At the subjective level, changes are often reflected in people’s day to day behaviours and activities. These are referred to as acculturation strategies.

Q11. Discuss the acculturative strategies adopted by individuals during the course of acculturation.
Answer:  The following four acculturative strategies have been derived:

• Integration: It refers to an attitude in which there is an interest in both, maintaining one’s original culture and identity, while staying in daily interaction with other cultural groups.
• Assimilation: It refers to an attitude, which people do not wish to maintain their cultural identity, and they move to become an integral part of the other culture.
• Separation: It refers to an attitude in which people seem to place a value on holding on to their original culture, and wish to avoid interaction with other cultural groups.
• Marginalization: It refers to an attitude in which there is little possibility or interest or interest in one’s cultural maintenance, and little interest in having relations with other cultural groups.

TEXTBOOK QUESTION AND ANSWER:

Q1. What are the goals of scientific enquiry?
Answer: There exists diversity in types of researches or studies undertaken by psychologists but they all seem to share some common goals of enquiry, which are as follows-:

1. Description
   • This helps to define the phenomena and distinguish it from other phenomenas.
   • Description is necessary because any event or behaviour may have many aspects.
   • For example, the idea of entertainment varies from reading books to going to pubs, depending on the individual.
   • The recording of event or behaviour is an integral part of description.
2. Prediction
   • Prediction means forecasting of events.
   • It establishes relationship between two variables.
   • For example, one might say exercising leads to weight loss.
   • In psychology all predictions are made within a certain margin of error i.e. they are not pin-pointed or exact.
3. Explanation
   • Explanation involves knowing the cause or the reason behind the behaviour.
   • It also tries to understand the conditions under which a particular behaviour occurs. For example, a child behaves rudely whenever he is disturbed so his disturbances become the cause of his rude behaviour.
4. Control
   • Control means creating change in the phenomenon or behavior.
   • It refers to making behaviour happen, reduction in it or enhancement in it.
   • The changes produced by psychological treatment in terms of therapy are good examples of control.
5. Application
   • Psychological researches are often conducted to solve various problems faced by file society.
   • Psychology helps in solving problem at individual, organizational or community level.
   • For example, therapies are provided to individuals and counseling is also there to help them.
   • At file organizational level, various psychological concepts like work motivation are used to enhance performance. At file community level, counseling is provided to help people engage in various , helpful and eco-friendly behaviours.

Q2. Describe the various steps involved in conducting a scientific enquiry.
Answer:  Scientific research or study is a clearly defined process that goes through a series of steps—

1. Conceptualising a problem
   • The process begins when a researcher selects a theme or topic for study.
   • Then the research questions or problems for the study are formulated.
   • Problem is based on the review of past researches, observations and personal experiences.
   • Problem indicates the relationship between variables.
     For example, what is the relationship between reward and classroom learning?
   • After formulation of problem, the hypothesis is formed, which is the tentative and testable statement about the relationship between two variables.
     For example, increased amount of reward will lead to betterment in learning.
2. Collecting data
   • Data collection requires developing a research design or a blueprint of the entire study.
   • Participants of the study are decided, depending on the nature of study, they could be children, adolescents, college students, teachers, workers, elder people etc.
   • Methods of data collection like observation, experimental, correlational method etc are decided.
   • The next decision is taken about the tools to be used, like interview schedule,. questionnaire, survey etc.
   • Procedure for data collection is decided i.e. how the tools need to be administered to collect data i.e. individual to collect data i.e. individual or group administration.
   • This is followed by actual data collection.
3. Drawing conclusions
   • The next step is to analyse data to understand its meaning.
   • The graphical representation of data is made using, bar diagram, pie chart, histogram, mean, median, mode, standard deviation etc.
   • The purpose of analysis is to verify a hypothesis and draw conclusions accordingly.
4. Revising research conclusions
   • The research begins with the hypothesis.
   • Then researcher sees whether the conclusions support this hypothesis or not.
   • If conclusions support the hypothesis then it is confirmed.
   • If it is not confirmed researcher revises or states an alternative hypothesis/theory and again tests it and the same process continues.

Q3. Explain the nature of psychological data.
Answer:  Data is any information related to mental processes, experiences and behaviour, collected by using various tools.
Psychological data are of different types, such as-:

1. Demographic information
   This information includes personal information related to a particular individual. This includes name, age, gender, education, marital status, residence, caste, religion, income etc, which are personally relevant.
2. Physical information
   This includes information pertaining to physical environment i.e. ecological condition.
   It also includes information about economy, housing conditions, facilities at the home, in the school, transportation etc.
3. Physiological data
   This is related to Biological data.
   For example, height, weight, heart rate, level of fatigue, EEG, reaction time, sleep, blood pressure etc is collected.
   Data related to animal’s biological functioning is also collected.
4. Psychological information
   This includes data regarding psychological functioning of individual.
   It involves data about intelligence, personality, attitudes, values, emotions, motivation, psychological dysfunctions, consciousness etc.
   Thus obtained data is divided into various categories, so that it can be analysed using statistical measures.

Q4. How do experimental and control group differ? Explain with the help of an example.
Answer:

1. Experimental group: The subjects in study who receive some special treatment in regard to the independent variable.
   In an experiment this group is administered the independent variable (the variable that is manipulated to see its effect on any other variable under study).
2. Control Group: control group is a comparison group.
   • The independent variable is not administered on this group.
   • Subjects in a study who do not receive the special treatment given to the experimental group.

The purpose is to see whether any difference occur in two groups as a result of application of independent variable on experimental group.
For example, suppose, an experiment is carried out to study the effect of presence of others on helpful behaviour, one participant was put in a situation requiring help, say, someone drowning in swimming pool, here five other people were also present, another participant was alone in the emergency situation.
In an experiment except for the experimental manipulation, other conditions are kept constant for both the groups.

Q5.  A researcher is studying relationship between speed of cycling and the presence of people. Formulate a relevant hypothesis and identify the independent and dependent variables.
Answer:

• Variable: It is any stimulus or event which varies or can take on different valves can be measure e.g. weight, height.
• Hypothesis: It is a tentative and testable statement which expresses relation between two or more than two variables, e.g.: those who are rewarded shall require lesser number of trials to learn than those who are not rewarded.
• Independent variable: It is the variable which is systematically manipulated or altered in an experiment. It is the cause.
• Dependent variable: It is the variable that is measured in an experiment. It is the effect.
• As per the question:Hypothesis. Presence of others will enhance the speed of cycling.
  Independent variable. Presence of others Dependent variable. Speed of cycling

Q6.Discuss the strengths and weaknesses of experimental method as a method of enquiry.
Answer: Experimental method is aimed at discovering causal relationship between various factors by manipulating the situation under totally controlled conditions.
Characterstics:

• Experimentation involves manipulation of variables to study their effect on other aspects.
• Experiments are carried out in totally controlled condition.
• Subjects or individuals are assigned to experimental and control group, randomly.
• All factors other than manipulated variable that might affect the dependent variable are kept constant.

Advantages:

• Experimental method aims at establishing cause-effect relationship between the variables.
• Replication and verification of obtained result is possible.
• The investigator can manipulate the independent variable according to the
  demands of the situation.
• It can be performed at any time.
• It is very objective—No personal bias exists.

Limitations:

• Experiments are conducted in a very artificial and unrealistic situations-the setting is not natural.
• They lack external validity i.e. generalizability. Since they are not done in natural settings, the results can’t be generalized with confidence.
• It is difficult to control and know all extraneous variables like – motivation, emotion, state etc.
• It is not always possible to study a problem experimentally.
  For example, personality can’t be studied experimentally.

Q7. Dr. Krishnan is going to observe and record children’s play behaviour at a nursery school without attempting to influence or control the behaviour. Which method of research is involved? Explain the process and discuss its merits and demerits.
Answer:  Dr. Krishnan would use the method of non-participant observation to observe and record children’s behaviour at play without attempting to influence or control the behaviour. He would sit in a corner and observe the children’s behaviour without them being aware of it. He would note the behaviour of children while playing, how ’ they interact with each other and their reaction towards winning or losing. He would collect all the data in a file and then match the conclusion with the hypothesis.
Merits of non-participant observation:

• The researcher observes the people and their behaviour in naturalistic settings.
• The observer can get first hand information regarding the subject.

Demerits:

• This method is time consuming, labour intensive and subject to personal biases.
•  The researcher may interpret the behaviour based on personal values.

Q8. Give two examples of the situations where survey method can be used. What are the limitations of this method?
Answer:  Survey Method is a research method utilizing written questionnaires or personal interviews to obtain data of a given population.
For example: Surveys are used in variety of situations such as

1. They can be used in political regime to know whether people approve or disapprove any particular policy of government, say for example, policy of reservation in higher education or Nuclear deal with America in recent times.
2. They are used during elections also to know who will people vote to.
3. Surveys can also be used to test hypothesis about the relationship among variables. One may try to find out the effect of some event on people’s behaviour.
   For example – Surveys have been conducted after the earthquake at Bhuj in Gujarat to find out the impact of earthquake on people’s lives.
4. In marketing area, before launching a product surveys are often conducted. They are used to assess people’s attitude on various social issues such as family planning and gender equality.

Limitation:

1. The major difficulty is the issue of accuracy and honesty of the responses as the respondents attempt to create favourable impression – faking is possible.
2. Surveyor’s bias also affects the results. He/she may ask the question in such a way as to elicit desired response.
3. Surveys remain at the surface and it does not penetrate into the depth of the problem. They are time-consuming and expensive.
4. These techniques make the respondent conscious. So he/she may mould his/her responses.
5. Survey demand expertise, research knowledge and competence on the part of the researcher. Most of the survey researchers don’t possess these qualities in the required amount. This invalidates the quality of survey.
6. Sample selected might not be the true representative of the population.

Q9. Differentiate between interview and questionnaire.
Answer:  Interview :

• Interview is a face to face interaction between two people
• They can be structured or unstructured
• Interviews are flexible; questions can be added or altered.
• Interviewer can dig deeper by posing counter question and by noticing non-verbal clues.
• They are subjective in nature.
•  It is not a good tool for those who can’t express themselves verbally
• It requires highly skilled person as interviewer.

Questionnaire :

• It consists of a form containing a series of questions where the respondents themselves fill in the answers.
• Questionnaire is always structured.
• It is not possible to know anything more that what is asked in the question.
• They are highly objective.
• Sometimes someone else can also fill in the questionnaire other than the target person.
• Clarification of questions is sometimes not possible.
• They can be administered to a large number of people at a time.
• Comparatively less skilled person can do the Interpretation.

Q10. Explain the characteristics of a standardised test.
Answer:  Characteristics of a standardised test:

1. Reliability: Reliability refers to the consistency of scores obtained by an individual on the same test on different occasions. If the test is reliable, these showed not be any variation in the scores obtained by the students on the 2 occasions.
   For this we can complete the following:
   (i)Test-retest reliability: it indicates the temporal stability. It is computed by finding out co-efficient of correlation b/w the 2 sets of same people.
   (ii) Split-half reliability: It gives an indication about the degree of intends, consistency of the test. .
2. Validity: For a test to be usable, it must be valid. Validity refers to the question “does the test measure what it claims to measures”. E.g. If a test is for assessment intelligence, it should only be testing intelligence and not aptitude.
3. Norms: A test becomes standardized if norms are developed for the test, norm is the normal average performance of the group. The test is administered on a large number of students. Their average performance standards are based in their age, sex, place of residence, etc. this helps us in compassion of performance of groups and individual students.

Q11. Describe the limitations of psychological enquiry.
Answer:  LIMITATIONS OF PSYCHOLOGICAL ENQUIRY:

1. Lack of true zero point
   Psychological measurements do not have a true zero point like physical sciences. For example, there is no zero interest, attitude or personality.
   So the measurements are not absolute, they are relative in nature.
   Sometimes ranks are also used as scores.
2. Relative nature of psychological tools
   Psychological tests, Questionnaire etc. are not universally applied; they are made for particular context.
   Tools developed in urban context may not be applied in rural area, also western tests and other tools may not apply elsewhere.
3. Subjective interpretation qualitative data
   The data which can’t be categorized or quantified in scores or ranks, runs the risk of subjective (individual, personal) interpretation.Every researcher may give different meanings to data.

Q12.What are the ethical guidelines that a psychologist needs to follow while conducting a psychological enquiry?
Answer:  Since psychology largely deals with human beings, so the researchers need to follow some moral principles which are as follows:

1. Voluntary participation
   • This means that participants have the freedom to choose whether to participate in the study or not.
   • Use of force or coercion or any other pressure should not be used.
   • Participants should have the right to withdraw from study any time without penalty.
2. Informed consent
   • Participants in a study should understand what treatment they will undergo during study.
   • This information should be given before the study/research starts.
   • If at times it is not possible to reveal all the information, they should be at least explained the nature of study before it starts.
3. Debriefing
   • Sometimes due to the nature of the study it becomes necessary to withhold some information from the participants, this is known as deception.
   • So after the study is over the participants are given complete information to complete their understanding of research.
     For example, suppose a researcher wants to study the relationship between frustration and aggression, the participants will not be informed that they’ll be put in a frustrating situation; otherwise experiment or study will have no conclusions; so here deception is necessary.
     However, after it is over they should be told that they were aroused deliberately. , Why was it done should also be explained.
   • It ensures that the participants leave the study in the same physical or mental state as when they entered.
   • Efforts should be made to remove any anxiety or other adverse effects from the minds of the participants as a result of being deceived in the study.
4. Sharing the results of the study
   It is obligatory for the researcher to go to the participants and share the results of study with them.
   Participants expect that the results of study done with them will be told to them, they want to know about their behaviour and where do they fall as compared to others.
   It has two advantages-:
   • One, researchers full fill the expectations of the participants.
   • Second, the participants may tell the researcher about something else which may provide supplementary information.
5. Confidentiality of data sources
   • The participants have right to privacy.
   • This right is protected by keeping the information provided by them in strict confidence.
   • It becomes more important if the information is personal and may become embarrassing if revealed.
   • The information should be used for the purpose of research only.
   • To maintain confidentiality one should not record their identities.
   • Sometimes identity is required, in such cases code numbers should be given on the data sheet and the names and their codes should be kept separately.

TEXTBOOK QUESTION AND ANSWER:

Q1. What is behaviour? Give examples of overt and covert behaviour.

Answer

Behaviours are responses or reactions we make or activities we engage in.
Examples of overt behaviour:
→ Blinking of eyes when a something is hurled at a person.
→ Withdrawing the hand immediately after touching a hot pan.
Examples of covert behaviour:
→ The  twitching of hand muscles while playing a game of chess.
→ Pounding of heart during an interview.

Q2. How can you distinguish scientific psychology from the popular notions about the discipline of psychology?

Answer

Scientific psychology	Popular notion about psychology
It is based on scientific study of psychological phenomenon.	It uses common-sense knowledge to understand behaviour.
It explains the psychological phenomenon systematically on the basis of empirical data.	It explains the phenomenon on the basis of experiences, sayings or beliefs.
It studies the patterns of behaviour that can be predicted before they occur.	It explains events in hindsight after they occur.

Q3. Give a brief account of the evolution of psychology.

Answer

Modern psychology grew out of ancient philosophy concerned with questions of psychological significance. The formal beginning of modern psychology is traced back to 1879 when the first experimental laboratory was established in Leipzig, Germany by Wilhelm Wundt.

• The initial approach to study psychology was based on introspection or structuralism in which the individuals were asked to describe their experiences.

• It was followed by functionalism that studied the working of the mind and the impact of behaviour upon people’s interaction with their environment.
• Gestalt psychology emerged as a reaction to structuralism in the early 20th century and focused on the organisation of the perceptual experiences.
• Another reaction was the development of behaviourism that studied behaviour or responses in a measurable and objective form.

• This was followed by psychoanalysis of Sigmund Freud that viewed human behaviour as a dynamic manifestation of unconscious desires, conflicts and their gratification.

• In contrast, the humanistic perspective emphasised the free will of human beings and their natural striving to grow and unfold their inner potential.

• Further, Cognitive perspective was a combination ofGestalt approach and structuralismand focused on how an individual perceived the world.

• Later, Constructivism viewed human beings as activelyconstructing their minds through the exploration of physical and the social world.

• It was followed by Vygotsky’s view that human mind develops through social and cultural processes in which the mind is perceived as culturally constructed by joint interaction between children and adults.

Therefore, the evolution of psychology passed through various stages and levels. Starting from the roots of philosophy, it took a new direction and included numerous theories of structuralism, functionalism, behaviourism, constructivism, etc. However, in contemporary era the discipline of psychology has grown into a scientific discipline, which deals with various processes underlying human experiences and behaviours.
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Q4. What are the problems for which collaboration of psychologists with other disciplines can be fruitful? Take any two problems to explain.

Answer

The problems for which collaboration of psychologists with other disciplines can be fruitful are:

→ In Medical science, Doctors have realised that the maxim, healthy body requires a healthy mind. A large number of hospitals now employ psychologists. The role of psychologists in preventing people from engaging in health hazardous behaviours and in adhering to the prescribed doctors’ regimen. While treating patients suffering from cancer, AIDS, and the physically challenged have also felt the need for psychological counselling.
→ In Engineering, it is necessary for an architecture to satisfy her/his clients by providing mental and physical space through her design and satisfy aesthetically. Engineers must also take into account human habits in their plans for safety, for example, on streets and highways. Psychological knowledge helps in a big way in designing of all mechanical devices and displays.

Q5. Differentiate between (a) a psychologist and a psychiatrist (b) a counsellor and a clinical psychologist.

Answer

(a)

Psychologist	Psychiatrist
A psychologist deals with the psychological phenomenon.	A psychiatrist deals with serious mental problems.
His/her main work is research in psychology and formulation of psychological conclusions that are derived on the basis of data.	A psychiatrist studies the causes, treatment and prevention of psychological disorders.
A psychologist does not hold a medical degree and is mainly into academic and research fields.	A psychiatrist holds a medical degree and he/she can use medical treatment to cure the patients.

(b)

Counsellor	Clinical Psychologist
A counsellor deals with the causes, treatment and prevention of different types of psychological disorders, which are related to motivational and emotional problems.	A clinical psychologist provides therapy for behavioural problems, which are related to mental disorders.
Counsellors help people in vocational rehabilitation programmes, making professional choices and adjusting to new situations in life.	Clinical psychologists conduct interviews and administer psychological tests to diagnose various problems.
A counsellor deals with different types of psychological disorders in everyday life of the patient.	A clinical psychologist deals with specific and complicated psychological disorders

Q6. Describe some of the areas of everyday life where understanding of psychology can be put to practice.

Answer

Some of the areas of everyday life where understanding of psychology can be put to practice are:

→ Psychology helps to understand various personal problems like family, marriage and work sphere and also helps to deal with larger problems related to community, society, national or international.

→ Psychology enables an individual to understand oneself in a balanced and positive way without being reactionary, in order to deal with everyday challenges and meet with personal expectations.

→ It also suggest solutions to a variety of problems related to children, adolescents, adults and the elderly people.

→ It also helps in analysing vital social problems relating to social change and development, population,  poverty, interpersonal or intergroup violence, and environmental  degradation.

→ Psychological principles helps to develop good habits of study for improving your learning and memory, and for solving your personal and interpersonal problems by using appropriate decision- making strategies.

Q7. How can knowledge of the field of environmental psychology be used to promote environment friendly behaviour?

Answer

The knowledge of the field of environmental psychology used to promote environment friendly behaviour because:

→ It studies the interaction of physical factors such as temperature, humidity, pollution, and natural disasters on human behaviour.

→ It investigates the influence of physical arrangement of the workplace on health, the emotional state, and interpersonal relations.

→ It also research the topics like disposal of waste, population explosion, conservation of energy, efficient use of community resources are associated with and are functions of human behaviour.

Q8. In terms of helping solve an important social problem such as crime, which branch of psychology do you think is most suitable. Identify the field and discuss the concerns of the psychologists working in this field.

Answer

Social psychology is most suitable branch for the purpose of solving social problems like crime.
It explores the thought process of people and their influence upon others and evaluates the impact of social environment upon the actions of an individual.
Social psychologists are concerned with topics like attitudes, conformity and obedience to authority, interpersonal attraction, helpful behaviour, prejudice, aggression, social motivation and inter-group relations.

VERY SHORT QUESTION AND ANSWER:

Q1.What is map generalisation?
Answer:
As maps are drawn at a reduced scale to serve a definite purpose, it is the job of a cartographer is to generalise the map contents. In doing so, a cartographer must select the data relevant to the selected theme and simplify it as per the needs. It is called map generalization. Every map is drawn with a definite objective. For example, a general purpose map is drawn to show information of a general nature such as relief, drainage, vegetation, settlements, means of transportation, etc. Similarly, a special purpose map exhibits information pertaining to one or more selected themes like population density, soil types or location of industries. It is, therefore, necessary to carefully plan the map contents while the purpose of the map must be kept in the forefront.

Q2.Why is map design important?
Answer:
Map Design is very important as it involves the planning of graphic characteristics of maps including the selection of appropriate symbols, their size and form, style of lettering, specifying the width of lines, selection of colours and shades, arrangement of various elements of map design within a map and design for map legend. The map design is a complex aspect of map-making and requires thorough understanding of the principles that govern the effectiveness of graphic communication.

Q3.What are different types of small-scale maps?
Answer:
Small-scale maps are divided into two types:

1. Wall Maps: These maps are generally drawn on large size paper or on plastic base for use in classrooms or lecture halls. The scale of wall maps is generally smaller than the scale of topographical maps but larger than atlas maps.
2. Atlas Maps: Atlas maps are very small-scale maps. These maps represent fairly large areas and present highly generalized picture of the physical or cultural features. Even so, an atlas map serves as a graphic encyclopaedia of the geographical information about the world, continents, countries or regions.

Q4.List out two major types of large-scale maps?
Answer:
Large-scale maps are divided into two types:

1. Cadastral maps: The term ‘cadastral’ is derived from the French word ‘cadastre’ meaning ‘register of territorial property’. These maps are drawn to show the ownership of landed property by demarcating field boundaries of agricultural land and the plan of individual houses in urban areas. The cadastral maps are prepared by the government agencies to realise revenue and taxes, along with keeping a record of ownership.
2. Topographical Maps: These maps are also prepared on a fairly large scale. The topographical maps are based on precise surveys and are prepared in the form of series of maps made by the national mapping agencies of almost all countries of the world. These maps follow uniform colours and symbols to show topographic details such as relief, drainage, agricultural land, forest, settlements, means of communication, location of schools, post offices and other services and facilities.

Q5.Is a map different from a sketch?
Answer:
A simplified map drawn freehand which fails to preserve the true scale or orientation. Map is a part of the earth’s surface on a plane surface at a reduced scale. It may also be understood that a simple network of lines and polygons without a scale shall not be called a map. It is only referred to as “the sketch”. In simple words, map has a specific scale and sketch does not have a scale. Map is drawn scientifically and sketch is drawn roughly. Sketch drawing is an art while map making is a science and science of maps is called cartography.

Q6. Write an explanatory account of types of maps.
Answer:

On the basis of scale:
1. Large-scale maps: These maps are drawn to show small areas at a relatively large-scale. For example, the topographical maps drawn at a scale of 1 : 250,000, 1 : 50,000 or 1 : 25,000 and the village maps, the zonal plans of the cities and house plans prepared on a scale of 1: 4,000,1: 2,000 and 1: 500 are large-scale maps. These are of two types:

1. Cadastral Maps
2. Topographical Maps

2. Small-scale maps: These maps are drawn to show large areas. These are of two types:

1. Wall Maps and
2. Atlas Maps

On the basis of functions, maps are of two types:

1. Physical maps: Physical maps show natural features such as relief, geology, soils, drainage, elements of weather, climate and vegetation, etc. Physical maps include relief maps, geological maps and climatic maps.
2. Cultural maps: Cultural maps show man-made features. These include a variety of maps showing population distribution and growth, sex and age, social and religious composition, literacy, levels of educational attainment, occupational structure, location of settlements, facilities and services, transportation lines and production, distribution and flow of different commodities. It includes political maps, population maps, economic maps and transportation maps.

SHORT ANSWER TYPE QUESTION:

Q1.Why are maps considered an important tool for geography?
Answer:
Geographers need maps for following purposes:

• To get information about resources, their development and planning for their utilization;
• To study changes that are taking place on the earth;
• To understand various physical factors;
• To understand the inter-relationship between physical and human resources;
• To make a comparative analysis and
• To present facts in a way that has a memorizing effect.

Q2.How is area of map measured using a planimeter?
Answer:
The area calculation is also carried out using Polar Planimeter. In this instrument, a measure is made of the movement of a rod whose locus is constrained by having one end fixed to a radial arc. The area to be measured is traced along its perimeter in a clockwise direction with an index mark, starting from one convenient point to which the index of the tracing arm must exactly return. Reading on the dial, before and after the tracing of area’s perimeter, will give a value in instrumental units. These readings are multiplied by the same constant for the particular instrument to convert into areas in square inches or centimetres.

Q3.How is direction of map measured?
Answer:
Direction is defined as an imaginary straight line on the map showing the angular position to a common base direction. The line pointing to the north is zero direction or the base direction line. A map always shows the north direction. All other directions are determined in to this relation. The north direction enables the map- user to locate different features with respect to each other. The four commonly known directions are North, South, East and West. These are also called the cardinal points. In between the cardinal points, one may have several intermediate directions.

Q4.How is distance between maps measured by geographer, planner and other resource researcher?
Answer:
The linear features shown on the maps fall into two broad categories, i. e. straight lines and erratic or zigzag lines. The measurement of straight line features like roads, railway lines and canals is simple. It can be taken directly with a pair of dividers or a scale placed on the map surface. However, distances are required, more often, along erratic paths, i.e. the coastlines, rivers and streams. The distances along all such features can be measured by placing a thread at the starting point and carrying it along the line up to the end point. The thread is then stretched and measured to determine the distance. It can also be measured by using a simple instrument called Rotameter. The wheel of the ‘rotameter’ is moved along the route to measure the distance.

Q5.Explain in detail about physical maps.
Answer:
Physical maps: Physical maps show- natural features such as relief, geology, soils, drainage, elements of weather, climate and vegetation, etc. These are of following types:

1. Relief Maps: Relief maps show general topography of an area like mountains and valleys, plains, plateaus and drainage.
2. Geological maps: Geological Maps are drawn to show geological structures, rock types, etc.
3. Climatic Maps: Climatic Maps depict climatic regions of an area. Besides, maps are also drawn to show the distribution of temperature.

Long Answer Type Questions :

Q1.Explain the essentials of map making.
Answer:
There are five essentials of map making. These are: Scale, map projection, map generalisation, map design and map construction and production.

1. Scale: All maps are reductions. The first decision that a map-maker has to take is about the scale of the map. The choice of scale is of utmost importance. The scale of a map sets limits of information contents and the degree of reality with which it can be delineated on the map.

2. Projection: Maps are a simplified representation of the three-dimensional surface of the earth on a plane sheet of paper. The transformation of all-side- curved-geoidal surface into a plane surface is another important aspect of the cartographic process. Such a radical transformation introduces some unavoidable changes in directions, distances, areas and shapes from the way they appear on a geoid. A system of transformation of the spherical surface to the plane surface is called a map projection. Hence, the choice, utilisation and construction of projections is of prime importance in map-making.

3. Generalisation: Every map is drawn with a definite objective. For example, a general purpose map is drawn to show information of a general nature such as relief, drainage, vegetation, settlements, means of transportation, etc. Similarly, a special purpose map exhibits information pertaining to one or more selected themes like population density, soil types or location of industries. It is, therefore, necessary to carefully plan the map contents while the purpose of the map must be kept in the forefront.

4. Map Design: It involves the planning of graphic characteristics of maps including the selection of appropriate symbols, their size and form, style of lettering, specifying the width of lines, selection of colours and shades, arrangement of various elements of map design within a map and design for map legend.

5. Map Construction and Production: The drawing of maps and their reproduction is the fifth major task in the cartographic process. It can be manual or computerised method.

Q2.How does a geographer measure the distance?
Answer:
The measurement of area of features like that of administrative and geographic units is also carried out over the surface of the map by map-users. There are different methods in which areas can be determined.

1. By means of regular pattern of squares: In this method, the area to be measured is covered by squares by
placing a sheet of graph paper beneath the map on an illuminated tracing table or by tracing the area onto the square sheet. The total number of ‘whole squares’ are summed up, together with ‘partial squares’. The area is then determined by a simple equation:

2. By using Polar Planimeter: In this instrument, a measure is made of the movement of a rod whose locus is constrained by having one end fixed to a radial arc. The area to be measured is traced along its perimeter in a clockwise direction with an index mark, starting from one convenient point to which the index of the tracing arm must exactly return. Reading on the dial, before and after the tracing of area’s perimeter, will give a value in instrumental units. These readings are multiplied by the same constant for the particular instrument to convert into areas in square inches or centimetres.

Q3.Explain in detail about cultural maps.
Answer:
Cultural Maps: Cultural maps show man-made features. These include a variety of maps showing population distribution and growth, sex and age, social and religious composition, literacy, levels of educational attainment, occupational structure, location of settlements, facilities and services, transportation lines and production, distribution and flow of different commodities.

• Political Maps: These maps show the administrative divisions of an area such as country, state or district. These maps facilitate the administrative machinery in planning and management of the concerned administrative unit.
• Population Maps: The population maps are drawn to show the distribution, density and growth of population, age and sex composition, distribution of religious, linguistic and social groups, occupational structure of the population, etc.
• Economic Maps: Economic maps depict production and distribution of different types of crops and minerals, location of industries and markets, routes for trade and flow of commodities.
• Transportation Maps: These maps show roads, railway lines and the location of railway stations and airports.

In This Post we are  providing Chapter- 6 CASH FLOW STATEMENT NCERT MOST IMPORTANT QUESTIONS for Class 12 ACCOUNTANCY which will be beneficial for students. These solutions are updated according to 2021-22 syllabus. These MCQS  can be really helpful in the preparation of Board exams and will provide you with a brief knowledge of the chapter

NCERT MOST IMPORTANT QUESTIONS ON CASH FLOW STATEMENT

1.Cash Flow Statement Cash flow statement is a statement showing the changes in financial position of a business concern during different intervals of time in terms of cash and cash equivalents.
The Revised Accounting Standard-3 has made it mandatory for all listed companies to prepare and present a cash flow statement along with other financial statements on annual basis.

2.Cash Flows Cash flows are inflows and outflows of cash and cash equivalent. It implies movement-in and movement-out of cash and cash equivalents. Receipt of cash from a non-cash item is termed as ‘cash inflow’, while cash payment in respect of such item is termed as ‘cash outflow’.
Cash Cash comprises of cash in hand and demand deposits with the bank.
Cash Equivalents Cash equivalents are ‘short-term highly liquid investments that are  readily convertible into known amount of cash and which are subjected to an insignificant risk of change in value’.

3.Objectives of Cash Flow Statement
(i)Useful in short-term financial planning.
(ii)Useful in efficient cash management.
(iii)Helpful in formulation of business policies.
(iv)Assists in preparation of cash budget.
(v)Used for assessment of cash flow from various activities, viz operating, investing and financing activities.

4.Limitations of Cash Flow Statement
(i)Based on historical cost principle.
(ii)Based on secondary data.
(iii)Ignores non-cash transactions.
(iv)No adherence of basic accounting principles.
(v)Cash flow statement is not a substitute for income statement.

5.Classification of Business Activities Accounting Standard-3 (Revised) requires that the changes resulting in inflows and outflows of cash and cash equivalents will be classified into following three activities:
(i) Cash flow from operating activities.
(ii)Cash flow from investing activities.
(iii)Cash flow from financing activities.

6.Cash Flow from Operating Activities Operating activities are the principal revenue producing activities of the enterprise and other activities that are not investing or financing activities.

For a Finance Company
(v)Cash received for interest and dividends (vi) Cash paid for interest
(vi)Sale of securities (vii) Purchase of securities
For an Insurance Company
(vii)Premiums and claims received (viii) Premiums and claims paid
For a Real Estate (Infrastructure) Company
(viii) Rent received      (ix) Rent paid

7.Cash Flow from Investing Activities As per AS-3, investing activities are the acquisition and disposal of the long-term assets and other investments, not included in cash equivalents.
Cash flow from investing activities are exhibited as follows:
h

8.Cash Flow from Financing Activities Financing activities are the activities which result in change in the size and composition of the owner’s capital (including preference share capital) and borrowings (including debentures) of the enterprise from other sources.
Cash flow arising from financing activities are exhibited as follows:

9.Format of Cash Flow Statement

10.Why is specific disclosure of cash flow from financing activities important while preparing cash flow statement?    
Ans. Separate disclosure of cash flows arising from financing activities is important because it is useful in predicting claims on future cash flows by providers of funds (both capital and borrowings) to the enterprise.

In This Post we are  providing Chapter- 2 ISSUE AND REDEMPTION DEBENTURES NCERT MOST IMPORTANT QUESTIONS for Class 12 ACCOUNTANCY which will be beneficial for students. These solutions are updated according to 2021-22 syllabus. These MCQS  can be really helpful in the preparation of Board exams and will provide you with a brief knowledge of the chapter

NCERT MOST IMPORTANT QUESTIONS ON ISSUE AND REDEMPTION DEBENTURES

1. What is the nature of Interest on Debentures?
Ans. Interest on debentures is a charge against the profits. It means that whether there is profit or loss it will be paid to the debenture holders.
2. What is meant by Redemption of Debentures?
Ans. Repayment of the amount borrowed by a company is called redemption of debentures. Debentures can be redeemed at Par or Premium. Students must remember that debentures are redeemed on the due date by paying the lump sum amount to the debenture holders or by paying in installments.
3. Give two sources of finance for Redemption of Debentures.
Ans.

1. Out of profits
2. issue of fresh Share Capital and Debentures.

4. Define Secured and Unsecured Debentures.
Ans. Secured or Mortgaged Debentures: Debentures are secured by a charge on the fixed assets of the company. If the company fails on payment of the principal amount or interest amount, assets under charge are sold to repay the amount due to the debenture holders.
Unsecured Debentures: Debentures are called unsecured in the sense that if the company defaults on payment of the principal amount or interest, debenture holder has to be along with other unsecured creditors of the company. In simple words, these debentures are not secured by the charge of fixed assets.

When Purchases consideration is more than net value of assets
Illustration 5 : A Company issued debentures of Rs.100 each at par for the purchases of the following assets and liabilities from Gupta Bros. at purchase consideration of Rs.5,00,000

Plant –	Rs.3,50,000	Stock	Rs.4,50,000
Land and Building	Rs.6,00,000	Sundry Creditors	Rs.1,00,000

Illustration 6 : Larson and Turbo Ltd. Issued 50,000 8% debentures of Rs.100 each payable on. Application at par and redeemable at par any time after 7 years from the date of the issue. Record necessary entries for the issue of debentures in the book of Company.
Solution:
In the books of Larson & Toubro Ltd.
Journal

Date	Particulars	L.F.	Debit (Rs.)	Credit (Rs.)
	Bank A/c      Dr.		50,00,000
	To % Debentures Application and Allotment A/c			50,00,000
	(Being the application money received)
	Debentures Application and Allotment A/c Dr.		50,00,000
	To 8% Debentures A/c			50,00,000
	(Being the transfer of application money to debenture account)

Illustration 7 : Claris Life Sciences Ltd. issued 5,000 14% Debentures of Rs. 100 each at a discount of 10%. Pass the necessary journal entries in the books of the company for the issue of debentures when debentures were to be:
(i) Redeemed at par.
(ii) Redeemed at a premium of 5%.
Journal

Date	Particulars	L.F.	Debit (Rs.)	Credit (Rs.)
	Bank A/c       Dr.		4,50,000
	To Debenture Application and Allotment			4,50,000
	(Application money received on 5,000 debentures @ Rs. 90 each)
(i)	Debentures Application and Allotment   Dr.		4,50,000
	Discount on issue of Debentures     Dr.		50,000
	To 14% Debentures			5,00,000
	(5,000 14% Debentures of Rs. 100 each issues at a discount of 10%)
(ii)	Debentures Application and Allotment  Dr.		4,50,000
	Loss on issue of Debentures A/c   Dr.		75,000
	To 14% Debentures			5,00,000
	To Premium on redemption of Debentures			25,000
	(5,000, 14% Debentures of Rs. 100 each issues at a discount of 10% but redeemable at a Premium of 5%)

Illustration 8 : ABC Company Ltd., had 6% debentures of Rs.1,00,000 on 1st January 2009 on which interest is paid on 3th June and 31st December. Pass necessary journal entries for the payment of interest for the year 2009, 10% tax is deducted at source from interest and remitted immediately. Books are closed on 31st December.
Solution:
ABC Ltd.
Journal

Date	Particulars	L.F.	Debit (Rs.)	Credit (Rs.)
2009 June 30	Interest on Debenture A/c    Dr.		3,000
To Debentures holder A/c			27,00
To Income Tax Payable A/c			300
(Half yearly debentures interest due and tax deducted at source)
June 30	Debentures holder A/c   Dr.		2,700
Income Tax Payable A/c   Dr.		300
To Bank			3,000
(Interest & Tax paid)
Dec 31	Interest on Debentures A/c     Dr.		3,000
To debentures holder A/c			2,700
To Income Tax Payable			300
(Half yearly debentures interest due and tax deducted at source)
Dec 31	Debentures Holders A/c     Dr.		2,700
Income Tax Payable Dr.		300	2,700
To Bank A/c			3,000
(Being Interest & Tax Paid)
Dec 31	Statement of Profit and Loss   Dr.		6,000
	To Interest on Debentures A/c			6,000
	(Debentures Interest (3000+3000)
	Transferred to Statement of Profit and loss)

Illustration 9 : B.G. Ltd. issued 2,000, 12% debentures of L100 each on 1st April 2012. The issue was fully subscribed. According to the terms of issue, interest on debentures is payable half yearly on 30th September and 31st March and tax deducted at source is 10%.
Pass necessary journal entries related to the debenture interest for the half-yearly ending 31st March, 2013 and transfer of interest on debentures of the year to the Statement of Profit & Loss.
Solution :
Books of B.G. Ltd.
Journal

Date	Particulars	L.F	Debit (Rs.)	Credit (Rs.)
2013 March 31	Interest on Debentures A/c    Dr.		12,000
To Debenture holder’s A/c			10,800
To income Tax Payable A/c /TDS from Debentures interest A/c			1,200
(Half yearly interest due on debentures and tax deducted at sources)
March 31	Debenture’s A/c     Dr.		10,800
To Bank A/c			10,800
(Payment of Interest)
March 31	Income Tax Payable / TDS from
Debentures Interest A/c     Dr.		1,200
To bank A/c			1,200
(TDS Deposited with income tax authorities)
March 31	Statement of Profit & Loss		24,000
To interest on Debentures A/c			24,000
(Interest transferred to Statement of P/L)

Question 10: Fill in the missing figures in the following entries: –
Journal

Date	Particulars	L.F.	Debit (Rs.)	Credit (Rs.)
	Case 1
	Bank A/c		….
	To Debentures Application & Allotment A/c			….
	(Being application money received)
	Debentures Application & allotment A/c Dr.		40,000
	Loss on issue of Debentures A/c Dr.		….
	To 10% Debentures A/c			….
	To Premium on Redemption A/c			….
	(Being issue of 400, 10% Debentures of Rs. 100 each at par and redeemable at premium of 10%)
	Case 2
	Bank A/c		….
	To Debentures Application & Allotment A/c			….
	(Being Application money Received)
	Debentures application & Allotment A/c   Dr.		….
	Loss an issue of Debentures A/c   dr.		….
	To 12% Debentures A/c			….
	To Premium on Redemption of Debentures A/c			….
	(Being 200, 12% Debentures issued at Rs. 90 repayable at Rs. 110)
	Case 3
	Bank A/c    Dr.		….
	To Debentures Application & Allotment A/c			….
	(Being Application money Received)
	Debentures Application & Allotment A/c Dr.		….
	Loss on issue of Debentures A/c		….
	To 10% Debentures A/c			….
	To Securities Premium Resources A/c			….
	To Premium of Redemption of Debentures A/c			….
	(Being 100, 10% Debentures issued at Rs. 105 repayable Rs. 110)

In This Post we are  providing Chapter- 3 FINANCIAL STATEMENTS OF A COMPANY NCERT MOST IMPORTANT QUESTIONS for Class 12 ACCOUNTANCY which will be beneficial for students. These solutions are updated according to 2021-22 syllabus. These MCQS  can be really helpful in the preparation of Board exams and will provide you with a brief knowledge of the chapter

NCERT MOST IMPORTANT QUESTIONS ON FINANCIAL STATEMENTS OF A COMPANY

1. Under which major sub-headings, the following items will be placed in the balance sheet of a company as per Schedule III, Part I of the Companies Act, 2013.
(i)Accrued incomes
(ii)Loose tools
(iii)Provision for employees benefits
(iv)Unpaid dividend
(v)Short-term loans
(vi) Long-term loans (Delhi 2014; Modified)
Ans.

2.Under which sub-headings will the following items be placed in the balance sheet of a company as per Schedule III, Part I of the Companies Act, 2013.
(i)Capital reserves
(ii)Bonds
(iii)Loans repayable on demand
(iv)Vehicles
(v)Goodwill
(vi)Loose tools (All India 2014; Modified)
Ans.

3.State under which major headings the following items will be presented in the balance sheet of a company as per Schedule III Part I of the Companies Act, 2013.
(i)Long-term borrowings                       (ii) Trade payables
(iii) Provision for tax                              (iv) Securities premium reserve
(v) Patents                                                (vi)Accrued incomes (Compartment 2014; Modified)
Ans.

4.State under which major headings the following items will be presented in the balance sheet of a company as per Schedule III Part I of the Companies Act, 2013.
(i)Trade marks
(ii)Capital redemption reserves
(iii)Income received in advance
(iv)Stores and spares
(v)Office equipments
(vi)Current investments   (Compartment 2014; Modified)
Ans.

5.State the major headings under which the following items will be put as per Schedule III, Part I of the Companies Act, 2013.
(i) Long-term investments                  (ii) Bills of exchange
(iii)Motor car                                          (iv) Discount on issue of shares
(v)Securities premium reserve           (vi) Unclaimed dividend (All India 2011; Modified)
Ans.

6.Give the major headings under which the following items will be shown in a company’s balance sheet as per Schedule III, Part I of the Companies Act, 2013.
(i)Sundry creditors
(ii)Provision for tax
(iii)Preliminary expenses
(iv)Loose tools
(v)Interest accrued on investments
(vi)Goodwill (All India 2011; Modified)
Ans.

7.List the items which are shown under the heading ‘current assets’ as per Schedule III, Part I of the Companies Act, 2013. (Delhi 2011; Modified)
Ans. Current Assets
(i) Current investments
(ii)Inventories
(iii)Trade receivables
(iv) Cash and cash equivalents
(v) Short-term loans and advances
(vi) Other current assets

8.List the items which are shown under the heading ‘current liabilities’ as per Schedule III, Part I of the Companies Act, 2013.  
Ans. Current Liabilities
(i) Short-term borrowings
(ii)Trade payables
(iii)Other current liabilities
(iv)Short-term provisions

9.Show the major headings into which the liabilities side of a company’s balance sheet is organised and presented as per Schedule III, Part I of the Companies Act, 2013.
Ans. Liabilities side of the company’s balance sheet as per Schedule III, Part I of the Companies Act, 2013
Name of the Company…………..
Balance Sheet
as at…………  (Rs in…… )

10.Show the major headings into which the assets side of a company’s balance sheet is organised and presented as per Schedule III, Part I of the Companies Act, 2013.(Delhi; All India 2008; Modified)
Ans. Assets side of the company’s balance sheet as per Schedule III of Part I of the Companies Act, 2013.
Name of the Company……….
Balance Sheet
as at………….  (Rs in…… )

In This Post we are  providing Chapter- 4 ANALYSIS OF FINANCIAL STATEMENT NCERT MOST IMPORTANT QUESTIONS for Class 12 ACCOUNTANCY which will be beneficial for students. These solutions are updated according to 2021-22 syllabus. These MCQS  can be really helpful in the preparation of Board exams and will provide you with a brief knowledge of the chapter

NCERT MOST IMPORTANT QUESTIONS ON ANALYSIS OF FINANCIAL STATEMENT

---

1. How would you show the following two items in a company‘s Balance Sheet as at 31st March, 2012 as per the requirement of Schedule VI:
   General Reserve (Since 31st March, 2011) Rs. 3,00,000, Statement of Profit and Loss (Debit Balance) for 2011-12 Rs. 2,00,000.Ans.
   Balance Sheet
   As at 31^st march, 2012 Equity and LiablitiesNote No.Rs.Shareholders‘ fund
   Reserve and Surplus 
   1 
   1,00,000Notes to Accounts:Reserve and SurplusGeneral Reserve(1st April, 2011)3,00,000Less: Statement of Profit and Loss(Dr. Balance)2,00,0001,00,000

2. Under Which main headings and sub-headings of Equity and Liabilities of the balance sheet as per the Revised Schedule VI of a company will you classify the following items:
   1. Proposed dividend.
   2. Fixed Deposit from Public
   Ans.Sr. No.ItemsMain-HeadingSub-Headingi.Proposed dividendCurrent-LiabilitiesShort-term provisionii.Fixed deposit from PublicNon-current liabilitiesLong term borrowing
3. State any two items which are shown under the head ’Investment‘ in a company balance sheet.
   Ans.
   (i) Government Securities.
   (ii) Sinking Fund Investment.
4. How is analysis of Financial statements suffered from the limitation of window dressing?
   Ans. Analysis of financial statements is affected from the limitation of window dressing as companies hide Some vital information or show items at incorrect value to portray better profitability and financial Position of the business, for example the company may overvalue closing stock to show higher profits.
5. What is the interest of Shareholders in the analysis of Financial Statements?
   Ans.
   (i) They want to judge the present and future earning capacity of the business.
   (ii) They want to judge the safety of their investment.

6. Name two tools of Financial Analysis?
   Ans. 
   1. Comparative Financial Statements.
   2. Ratio Analysis etc.
7. What is Horizontal Analysis?
   Ans: The analysis which is made to review and compare the financial statements of two or more then two Years is called Horizontal Analysis.
8. Give the example of Horizontal Analysis.
   Ans. Comparative Financial Statement.

9 Give the Main Heading and Sub- Heading of Equity and Liabilities of the Balance sheet of a company as per the Revised Schedule VI of the companies Act.1956.Ans.
2. EQUITY AND LIABILITIES
(5) Shareholders’ Funds
(d) Share Capital
(e) Reserves and Surplus
(f) Money received against share warrants
(6) Share Applications Money Pending Allotment
(7) Non-Current Liabilities
(e) Long-term borrowings
(f) Deferred tax liabilities(Net)
(g) Other Long-term Liabilities
(h) Long-term provisions
(8) Current Liabilities
(e) Short-term borrowings
(f) Trade payables
(g) Other current liabilities
(h) Short-term provisionsTOTAL

2. Give the Main Heading and Sub- Heading of Assets of the Balance sheet of a company as per the Revised Schedule VI of the companies Act.1956.
   Ans. ASSETS
   (1) Non-Current Assets
   (a) Fixed Assets 
   1. Tangible Assets
   2. Intangible assets
   3. Capital work-in progress
   4. Intangible assets under development
   2. Non-current investments
   3. Deferred tax assets (net)
   4. Long-term loans and advances
   5. Other non-current assets(2) Current Assets
   1. Current investments
   2. Inventories
   3. Trade receivables
   4. Cash and cash equivalents
   5. Short-term loans and advances
   6. Other current assets
3. Rearrange the following items under assets according to Revised or New Schedule VI:Ans.
   1. Livestock
   2. Loose Tools.
   3. Goodwill
   4. Trademarks
   5. Bills Receivable
   6. Debtors
   7. Land
   8. Leasehold
   9. Stock-in-Trade
   10. Stores and Spare Parts
   11. Vehicles
   12. Cash at Bank
   13. Work in Progress(Machinery)
   14. Interest accrued on Investment
   15. Furniture
   16. Advance to Subsidiaries
   17. Cash in Hand
   18. Plant
   19. Deposits with electricity supply company.
   20. Fixed Assets(Tangible): Livestock, Land, Leasehold, furniture, vehicles and plant
   21. Capital Work-in-progress: Work in progress(Machinery)
   22. Fixed Assets(Intangible): Goodwill and Trademarks
   23. Inventories: Loose Tools, Stock-in-Trade, Stores and Spare Parts.
   24. Trade Receivables: Bill Receivables, Debtors
   25. Cash and Cash Equivalents: Cash at Bank, Cash in Hand
   26. Long term Loans and Advances: Advance to Subsidiaries, Deposits with Electricity Supply Company.
   27. Other Current Assets: Interest Accrued on Investments.
4. List any three items that can be shown as contingent Liabilities in a company‘s Balance sheet.Ans:
   1. Claims against the Company not acknowledged as debts.
   2. Uncalled Liability on partly paid shares.
   3. Arrears of Dividend on Cumulative preference shares.108
5. How is a Company‘s balance sheet different from that of a Partnership firm? Give Two point only
   Ans. 
   1. For company‘s Balance Sheet there are two standard forms prescribed
      under the companies Act.1956 .Whereas, there is no standard form prescribed under the Indian partnership Act,1932 for a partnership Firms balance sheet.
   2. In case of a company‘s Balance sheet previous year‘s figures are required to be given whereas it is not so in the case of a partnership firms balance sheet.

10 Prepare Comparative and Common Size income statement from the following information for the year‘s ended march 31, 2008 and 2009.
Particulars2008(Rs.)2009(Rs.)1.Net Sales
2.Cost of Goods Sold
3.Indirect Expenses
4.Income Tax rate8,00,000
60% of sales
10% of Gross profit
50%10,00,000
60% of sales
10% of Gross Profit
60%Ans.Comparative Income statement:articular2008
amount2009
amountChange in
amountChange in
PercentageNet Sales
Less: C.O.G.S.8,00,000
4,80,00010,00,000
6,00,0002,00,000
1,20,00025%
25%Gross Profit
Less: Indirect Expenses3,20,000
32,0004,00,000
40,00080,000
8,00025%
25%Operating Profit/ PBT
Less: tax2,88,000
1,44,0003,60,000
2,16,00072,000
72,00025%
50%Profit after tax1,44,.0001,44,000———-————Common Size Income statementParticular2008
amount2009
amountPercentage of
Net sales in
P.Y.Percentage of
Net sales in
C.Y.Net Sales
Less: C.O.G.S.8,00,000
4,80,00010,00,000
6,00,000100%
60%100%
60%Gross Profit
Less: IndirectExpenses3,20,000
32,0004,00,000
40,00040%
4%40%
4%Operating Profit/ PBT
Less: tax2,88,000
1,44,0003,60,000
2,16,00036%
18%36%
21.6%Profit after tax1,44,.0001,44,00018%14.4%

In This Post we are  providing Chapter- 5 ACCOUNTING RATIOS NCERT MOST IMPORTANT QUESTIONS for Class 12PHYSICS which will be beneficial for students. These solutions are updated according to 2021-22 syllabus. These MCQS  can be really helpful in the preparation of Board exams and will provide you with a brief knowledge of the chapter

NCERT MOST IMPORTANT QUESTIONS ON ACCOUNTING RATIOS

1.OM Ltd has a current ratio of 3.5 : 1 and quick ratio of 2 : 1. If the excess of current assets over quick assets as represented by inventory is Rs 1,50,000, calculate current assets and current liabilities. (Delhi2012)
Ans.

2.X Ltd has a current ratio of 3 : 1 and quick ratio of 2 :1. If the excess of current assets over quick assets as represented by inventory is Rs 40,000, calculate current assets and current liabilities. (All India 2012)
Ans.

3.From the following information, calculate any two of the following ratios
(i)Debt-equity ratio
(ii)Working capital turnover ratio (iii) Return on investment
Information Equity share capital Rs 10,00,000, general reserve Rs 1,00,000, balance of statement of profit and loss after interest and tax Rs 3,00,000, 12% debentures Rs 4,00,000, creditors Rs 3,00,000, land and buildings Rs 13,00,000, furniture Rs 3,00,000, debtors 12,90,000, cash Rs 1,10,000.Revenue from operations i.e. sales for the year ended 31st March, 2011 was Rs 30,00,000. Tax rate is 50%. (All India 2012; Modified)
Ans.

4.From the following information, calculate the following ratios
(i)Liquid ratio
(ii)Proprietary ratio

Ans.

5.From the following information, calculate any two of the following ratios
(i) Operating ratio      (ii) Inventory turnover ratio (iii) Proprietary ratio

Ans.

6.From the following information, calculate any two of the following ratios (i) Liquid ratio (ii) Debt equity ratio

Ans.

7.From the following information, calculate any two of the following ratios (i) Net profit ratio (ii) Debt equity ratio

Ans.

8.From the following calculate the ‘gross profit ratio’ and ‘working capital turnover ratio’:

Ans.

9.(i)From the following information, compute ‘debt equity ratio’

(ii) The current ratio of X Ltd is 2 : 1. State with reason which of the following transaction would increase, decrease or not change the ratio 
(a)Included in the trade payables was a bills payable of Rs 9,000 which was met on maturity.
(b)Company issued 1,00,000 equity shares of Rs 10 each to the vendors of machinery purchased. (Delhi 2014)
Ans.

10.The quick ratio of a company is 1.5 : 1. State with reason which of the following
transactions would (a) increase (b) decrease or (c) not change the ratio
(a)Paid rent Rs 3,000 in advance.
(b)Trade receivables included a debtor Shri Ashok who paid his entire amount due Rs 9,700.
(ii) From the following information compute ‘proprietary ratio’

Ans. (i) (a) Not change the ratio
Reason As there is a simultaneous increase and decrease in current asset, i.e. prepaid expenses and cash, therefore it will not affect the value of current asset.
(b) Not change the ratio
Reason As there is a simultaneous increase and decrease it will not affect the value of current asset.

In This Post we are  providing Chapter- 1 ACCOUNTING FOR A SHARE CAPITAL NCERT MOST IMPORTANT QUESTIONS for Class 12 ACCOUNTANCY which will be beneficial for students. These solutions are updated according to 2021-22 syllabus. These MCQS  can be really helpful in the preparation of Board exams and will provide you with a brief knowledge of the chapter

NCERT MOST IMPORTANT QUESTIONS ON ACCOUNTING FOR A SHARE CAPITAL

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Illustration 1: S T L Global Ltd. was formed with a nominal Share Capital of Rs. 40,00,000 divided into 4,00,000 shares of Rs. 10 each. The Company offers 1,30,000 shares to the public payable Rs. 3 per share on Application, Rs. 3 per share on Allotment and the balance on First and Final Call. Applications were received for 1,20,000 shares. All money payable on allotment was duly received, except on 200 shares held by Y. First and Final Call was not made by the Company.
How would you show the relevant items in the Balance Sheet of STL Global Ltd.?
Solution 1:
Balance Sheet (Extract) of S T L Global Ltd. (Relevant Part only)
As at ________________

Particular	Notes. no	(Rs.)
Equity and Liabilities
Shareholder’s Funds:
(a) Share Capital	(1)	7,14,000
Assets
Current Assets:
Cash and Cash Equivalents (Cash at Bank)		7,14,000
Particular	Details	(Rs.)
(1) Share Capital
Authorised Capital :
4,00,000 Shares of Rs. 10 each		40,00,000
Issued Capital :
1,30,000 shares of Rs 10 each		13,00,000
Subscribed but not fully paid capital:
1,20,000 shares of Rs. 10 each Rs. 6 per share called – up	7,20,000
Less : calls in Arrears (200 shares x Rs. 3)	6,000
		7,14,000

Illustration 2: On 1st April, 2012, Janta Ltd. was formed with an authorized capital of 50,00,000 divided into 1,00,000 equity shares of 50 each. The company issued prospectus inviting application for 90,000 Shares. The issue price was payable as under:
On Applicant : Rs. 15
On Allotment : Rs. 20
On call : Balance amount
The issue was fully subscribed and the company allotted shares to all he applicants. The company did not make the call during the year.
Show the following :

1. Share capital in the Balance Sheet of the company as per revised schedule – VI, Part-I of the companies Act, 1956.
2. Also prepare Notes to Account’s for the same.

Solution :
Balance Sheet of Janta Ltd.
As at……………………. (As per schedule iii)

Particulars	Note. no	Amount Current Years	Amount Previous Years
Equity & liabilities  1. Shareholder’s funds (a) Share Capital	1.	31,50,000

Notes to Accounts

Particulars	(Rs.)
1. Share Capital
Authorised Capital
1,00,000 equity shares of Rs. 50 Each	50,00,000
Issued Capita;
90,000 equity shares of Rs. 50 Each	45,00,000
Subscribed capital
Subscribed but not fully paid
90,000 shares of Rs. 50 each Rs. 35 called up Rs.	31,50,000

Issue of Shares  Shares can be issued in two ways 1. for cash 2. for consideration other than cash Terms of Issue of Shares Shares can be issued in two ways. 1. Issue of shares at Par 2. Issue of shares at Premium

Issue of shares against Lump sum payment : When whole amount due on shares is payable in one instalment. The journal entries will be as follow:
Illustration 3 : Vaibhav Ltd. issued 1,00,000 shares of Rs. 10 each at per. The whole amount was payable with application. Pass the necessary journal entries in the books of company.
Solution:
Journal

Date	Particulars	L.F	Debit(Rs.)	Credit(Rs.)
	Bank A/c		10,00,000
	To Share Application and allotment A/c			10,00,000
	(Being the application money received on 1,00,000 shares at Rs. 10 per share)
	Share Application and allotment A/c Dr.		10,00,000
	To Share Capital A/c			10,00,000
	(Being the share allotted and transfer of application money an 1,00,000 shares to share capital account)

Illustration 4 : X Ltd. invited application for 10,000 shares of the value of Rs. 10 each. The amount is payable as Rs. 2 on application and Rs. 5 on allotment and balance on First and Final Call. The whole of the above issue was applied and cash duly received. Give Journal entries for the above transaction.

Date	Particulars	L.F	Debit(Rs.)	Credit(Rs.)
	Bank A/c     Dr.		20,000
	To share application A/c			20,000
	(Being the application money received on 10,000 shares at Rs. Per share)
	Share Application A/cv    Dr.		20,000
	To Share Capital A/c			20,000
	(Being the transfer of application money on 10,000 shares to share capital account).
	Share Allotment A/c      Dr.		50,000
	To Share Capital A/c			50,000
	(Being the amount due on 10,000 shares at Rs. 5 per Share)
	Bank A/c      Dr.		50,000
	To Share Allotment A/c			50,000
	(Being the receipt of Rs. 5 on 10,000 Shares)
	Shares first & final Call A/c     Dr.		30,000
	To Share Capital A/c			30,000
	(Being the amount due on 10,000 Shares at Rs. 3 per share)
	Bank A/c               Dr.		30,000
	To Share first & final all A/c			30,000
	(Being the receipt of Rs. 3 on 10,000 shares)

Illustration 5 : V Ltd. Issued 20,000 Equity shares of Rs. 10 each at a premium of Rs. 3 payable as follows:
On Application Rs. 4
On Allotment Rs. 5 (including Securities Premium Reserve)
On First Cell Rs. 2
On Final Call Rs. 2
All shares were duly subscribed and all money duly received. Pass necessary Journal Entries.
Solution :
In the Book of X Ltd.

Date	Particulars	L.F	Debit(Rs.)	Credit(Rs.)
	Bank A/c     Dr.		80,000
	To Equity Share Application A/c			80,000
	(Being the application money received on 20,000 Equity Shares at Rs. 4 per Equity Share)
	Equity Share Application Account    Dr.		80,000
	To Equity Share Capital Account			80,000
	(Being the transfer of application money on 20,000 Equity Shares of Equity Shares Capital Account)
	Equity Share Allotment Account    Dr.		1,00,000
	To Equity Share Capital Account			40,000
	To Securities Premium Reserve A/c			60,000
	(Being the amount due on 10,000 Equity Shares at Rs. 5 including Premium Rs. 3 Shares)
	Bank A/c		1,00,000
	To Equity Share allotment A/c			1,00,000
	(Being the receipt of Rs. 5 on 10,000 Equity Shares)
	Equity Share First Call A/c      Dr.		40,000
	To Equity Share Capital Account			40,000
	(Being the amount due on 20,000 Equity Shares at Rs. 2 Equity Shares)
	Bank A/c    Dr.		40,000
	To Equity Shares First Call A/c			40,000
	(Being the receipt of Rs. 2 on 20,000 Equity Shares)
	Equity Share Final Call A/c     Dr.		40,000
	To Equity Share Final Call A/c			40,000
	(being the receipt of Rs. 2 on 20,000 Equity Shares)
	Bank A/c    Dr.		40,000
	To Equity Shares First Call A/c			40,000
	(being the receipt of Rs. 2 on 20,000 Equity Shares)

Issue of shares at discount [Section 53] : A company cannot issue shares at discount other than sweat equity shares.
Shares Issue for Consideration Other than Cash
When a company purchases any fixed asset or business and makes the payment to the vendor in form of issue of shares in place of cash it is called the issue of shares for consideration other than cash.
Share can be issued at par, at premium.
Journal entries for issue of shares to vendors/consideration other than cash

Date	Particulars	L.F	Debit (Rs.)	Credit(Rs.)
	On Purchases of asset:		Amount of purchase price
	Sundry Asset Account       Dr.
	To vendor
	On Purchases of business:
	When purchases consideration is more then net asset
	Sundry Asset Account      Dr.			Agreed
	Goodwill Account (B/F)			Value
	To Sundry Liabilities		Consideration	Agreed  Value
	To Vendor		-Net assets	Purchase Consideration
	When purchase consideration is less than net asset
	Sundry Assets Account		Agreed Value	Agreed
	To Sundry Liabilities			Value
	To Vendor			Purchases
	To capital Reserve A/c (B/F)			Condsideration
				Difference
	On Issue of Shares (a) at Par
	Vendor       Dr.
	To share Capital
	(b) On Issue of Share At Premium
	Vendor      Dr.
	To Share Capital A/c
	To Securities Premium Reserve A/c

Note: When name of vendor is given then we write the name of vendor
Illustration 6 : Atlas Co. Ltd. Purchased a machine from HMT Co. for Rs 64,000. It was decided to pay Rs. 10,000 in cash and balance will be paid by issue of shares of Rs. 10 each,
Pass journal entries shares

1. Issued at par
2. Issued at premium of 20%

Solution :
Journal

Date	Particulars		Debit (Rs.)	Credit (Rs.)
	Machinery Account        Dr.		64,000
	To HMT Ltd.			54,000
	To Bank Account			10,000
	(being the machine purchased and Rs. 10,000 paid cash and balance to be paid by issue of shares)
	(a) When Shares are issued at par
	HMT Ltd. (Vendor)		54,000
	To Share Capital			54,000
	(Being 5,400 shares of Rs, 10 each at pa at HMT Ltd.)
	(b) when Shares are issued at premium
	HMT Ltd. (vendor)      Dr.		54,000
	To Share Capital Account			45,000
	To Share Premium Account			9,000
	(being 4 ,500 shares of issued to vendor at a premium of Rs. 2 per share 54,000/10+2 = 4500

Illustration 7 : A company issued 15,000 fully paid up equity shares of Rs. 100 each for the purchases of the following assets and liabilities from Gupta Bros.
Plant – Rs. 3,50,000; Stock Rs. 4,50,00;
Land and Building Rs. 6,00,000; Sundry Creditors Rs. 1,00,000
Pass necessary Journal entries.
Solution:
Journal

Date	Particulars	L.F	Debit (Rs.)	Credit(Rs.)
	Plant A/c    Dr.		3,50,000
	Land and Building A/c      Dr.		6,00,000
	Stock Account       Dr.		4,50,000
	Good will Account (b/f)     Dr.		2,00,000
	To Sundry Creditors A/c			1,00,000
	To Gupta Bros.			15,00,000
	(Being the purchase of Business)
	Gupta Bros.       Dr.		15,00,000
	To Equity Shares Capital Account			15,00,000
	(Being issue of 15,000 shares of Rs. 100 each as payment of business price)

Note : Calculation : Goodwill = Purchases consideration + Liabilities – assets = Rs. 15,00,000 + Rs. 1,00,000 = Rs, 14,00,000 Rs. 2,00,000.
Illustration 8 : A company purchased a running business from Mahesh for a sum of Rs.
1,50,000 payable as Rs. 1,20,000 in fully paid equity shares of Rs. 10 each and balance in cash. The assets and liabilities consisted of the following Plant and Machinery Rs. 40,000; Stock Rs. 50,000; Building Rs. 40,000; Cash Rs, 20,000 Sundry debtors Rs, 30,000; Sundry creditors Rs. 20,000
Pass necessary Journal entries.
Solution
Journal

Date	Particulars	L.F	Debit (Rs.)	Credit(Rs.)
	Plant and Machinery A/c     Dr.		40,000
	Building A/c      Dr.		40,000
	Sundry Debtors    Dr.		30,000
	Stock Account     Dr.		50,000
	Cash A/c		20,000
	To sundry Creditors A/c			20,000
	To Mahesh			1,50,000
	To Capital Reserve A/c			10,000
	(Being the purchase of Business)
	Mahesh		1,50,000
	To Equity Shares Capital A/c			1,20,000
	To Bank A/c			30,000
	(Being the payment made to Mahesh in form of Shares)

Note : Calculation; Net assets – liabilities = Rs. 1,800,000- Rs. 20,000 Rs. 1,60,000 Capital reserve = Net Asset – Purchase consideration = Rs. 1,60,000 – Rs. 1,50,000 = Rs. 10,000
Illustration 9 : Pass necessary journal entries for the following transactions in the Books of Rajan Ltd.

1. Rajan Ltd. purchased machinery of Rs. 7,20,000 from Kundan Ltd. The payment was made to Kundan Ltd. by issue of equity shares of Rs. 100 each at 20% Premium.
2. Rajan Ltd. purchased a running business from Vikas Ltd. for a sum of Rs. 2,50,000 payable as Rs. 2,20,000 in fully paid equity shares of Rs.10 each and balance by a bank draft. The assets and liabilities consisted of the following:
   Plant & Machinery Rs, 90,000; Buildings Rs, 90,000;
   Sundry Debtors Rs. 30,000; Stock Rs. 50,000; Cash Rs. 20,000;
   Sundry Creditors Rs. 20,000

Solution
Rajan Ltd.
Journal

Date	Particulars	L.F	Debit(Rs.)	Credit(Rs.)
(a)	Machinery A/c    Dr.		7,20,000
	To Kundan Ltd.			7,20,000
	(Machinery purchased from Kundan)
	Kundan Ltd.      Dr.		7,20,000
	To Equity Share Capital A/c			6,00,000
	To Securities premium A/c			1,20,000
	(6,000 Equity Shares of Rs. 100 each issued as purchase consideration)
(b)	Plant & Machinery A/c     Dr.		90,000
	Building A/c     Dr.		90,000
	Sundry Debtors A/c    Dr.		30,000
	Stock A/c      Dr.		50,000
	Cash A/c    Dr.		20,000
	To Sundry Creditors A/c			20,000
	To Vikas Ltd.			2,50,000
	To Capital Reserve A/c			10,000
	(Business Purchased)
	Vikas Ltd.   Dr.		2,50,000
	To Equity Share Capital A/c			2,20,000
	To bank A/c			30,000
	(Shares issued and draft given

Illustration 10 : Ram holding 10 shares of Rs. 10 each of which Rs. 2 on application Rs. 3 on allotment but could not pay Rs. 3 on first call. His shares were forfeited by the Directors. The Final call is not made as yet. Give Journal entries in the book of company.
Solution:
Journal

Date	Particulars	L.F.	Debit (Rs.)	Credit (Rs.)
	Share Capital A/c (10×8)      Dr.		80
	To share First Call/calls in arrear A/c			30
	To Forfeited Shares A/c			50
	(Being 10 Shares forfeited for nonpayment of first call money)

Forfeiture of Shares Issued at Premium :

1. when the premium has been received;
2. When the premium has not been received.

Case 1: When the premium has been received : In such cases premium received will not be forfeited and will not record anywhere in the forfeiture journal entry.
Journal

Date	Particulars	L.F	Debit (Rs.)	Credit (Rs.)
	Shares Capital A/c       Dr.		Amount Called
	To various Calls/calls in arrear A/c		(Excluding Premium)	Unpaid Amt.
	To Forfeited Shares A/c			Amt. received (Excluding Premium)