ABHYAS · CA STUDENTS
CA Foundation: Accounting सीए फाउंडेशन: लेखांकन
Unlimited CA Foundation Paper 1 practice: journal entries, rectification, depreciation, BRS, final accounts, inventories, partnership and bills, with hints, worked steps and mistake checks. Original questions generated by code.
Theoretical framework and accounting process
- Accounting equation: find the missing figureAssets = Liabilities + Capital. Closing capital = Opening capital + Fresh capital + Profit − Drawings.
- Journal entries: which account to debit and creditModern rules: assets and expenses increase with a debit; liabilities, capital and incomes increase with a credit.
Rectification of errors
Depreciation accounting
- Depreciation: straight line method (SLM)SLM annual depreciation = (Cost − Scrap value) ÷ Useful life. Cost includes freight and installation. Part year → × months/12.
- Depreciation: written down value method (WDV)WDV charges a fixed % on the opening book value each year: depreciation in year n = Cost × (1 − r)^(n−1) × r.
Bank reconciliation statement
Final accounts of sole proprietors
- Trading account: gross profitGP = Net sales − Cost of goods sold; COGS = Opening stock + Net purchases + Direct expenses − Closing stock. Carriage outwards and salaries are indirect (P&L).
- Profit and loss account: net profit with adjustmentsNP = Gross profit + Other incomes − Indirect expenses. Add outstanding expenses; deduct prepaid expenses from the amount paid.
Partnership accounts
- Admission of a partner: new profit-sharing ratioNew share = Old share − Share sacrificed. If the new partner’s share comes from old partners in their old ratio, each old share is multiplied by (1 − new partner’s share).
- Goodwill: average profit and super profit methodsAverage profit method: Goodwill = Average profit × years’ purchase. Super profit = Average profit − Normal profit (capital employed × normal rate); Goodwill = Super profit × years’ purchase.
- Interest on partners’ capitalInterest on capital (when the deed allows) = Capital × Rate × Period. Additional capital earns interest only from the date it is introduced.
Bills of exchange and promissory notes
- Bills of exchange: due date with days of graceDue date = date of drawing + term (same date in the later month; last day of that month if the date does not exist) + 3 days of grace.
- Bills of exchange: discounting with a bankDiscount = Bill amount × Rate × Unexpired period ÷ 12 (months). Cash received = Bill amount − Discount.