CUET Accountancy Question Paper 2025 May 14 (Available)- Download Answer Key and Solution PDF

Step 1: Calculation of cash flow from operating Activities

Cash flows statement generally starts with cash flows from operating activities, as it reflects core business cash generation.


Step 2: Calculation of cash flow from investing Activities

Next, cash flows from investing activities like purchase and sale of fixed assets are calculated.


Step 3: Calculation of cash flow from financing Activities

Then, cash flows from financing activities such as loans and capital changes are calculated.


Step 4: Opening Balance of cash and cash Equivalents

Opening balance of cash is noted, usually to reconcile the net changes in cash flows.


Step 5: Closing Balance of Cash and Cash Equivalents

Finally, closing balance is computed to confirm the cash position at the end of the period.


Step 6: Conclusion

Hence, the correct sequence is:

C (Operating), A (Investing), D (Financing), B (Opening Balance), E (Closing Balance). Quick Tip: Cash flow statements generally present operating, investing, and financing activities in order, then reconcile opening and closing cash balances.

Step 1: Understanding Realisation Account

The Realisation Account is used in partnership dissolution to record assets and liabilities at the time of closing the business.


Step 2: Treatment of unrecorded liabilities

When unrecorded liabilities are paid by partners, the amount is debited to the Realisation Account to recognize the payment of those liabilities.


Step 3: Corresponding credit

The partners’ capital accounts or cash/bank account may be credited depending on the nature of payment.


Step 4: Conclusion

Thus, unrecorded liabilities paid by partners are shown on the debit side of the Realisation Account. Quick Tip: Payments of unrecorded liabilities by partners are debited to the Realisation Account in dissolution.

Step 1: Understand the initial profit sharing

A and B share profits in ratio 4:1.

Total share = 4 + 1 = 5 parts.


Step 2: C admitted for 25% share

C’s share = 25% = \(\frac{1}{4}\)

C acquires entire 25% from A’s share.


Step 3: Calculate new shares

A’s new share = Old share – C’s share = \(\frac{4}{5} - \frac{1}{4} = \frac{16}{20} - \frac{5}{20} = \frac{11}{20}\)

B’s share remains same = \(\frac{1}{5} = \frac{4}{20}\)

C’s share = \(\frac{1}{4} = \frac{5}{20}\)


Step 4: Express ratio \[ A : B : C = 11 : 4 : 5 \] Quick Tip: When new partner acquires share from old partner, subtract that share from old partner and keep others unchanged.

Step 1: Understand conditions for dissolution

A change in the existing profit-sharing ratio among partners generally leads to \textit{reconstitution of the partnership, but in some contexts, if partners agree to dissolve and form a new partnership, it may be considered dissolution.

Changes in profit-sharing ratio can lead to dissolution of the old partnership firm.

Illegal business (A) and breach of agreement (D) may also lead to dissolution but are not automatic in all cases.

Insanity of a partner (B) may lead to dissolution depending on the agreement.


Step 2: Conclusion

Among the given options, (C) is the answer provided, indicating change in profit-sharing ratio leads to dissolution. Quick Tip: A change in profit-sharing ratio typically results in reconstitution but may lead to dissolution if partners choose to end the old agreement.

Step 1: Calculate total application money received

Total shares applied = 4,000

Application money per share = Rs.50

Total application money = \(4,000 \times Rs.50 = Rs.2,00,000\)


Step 2: Shares allotted on pro-rata basis

Shares to be allotted = 3,000

Pro-rata allotment ratio = \(\frac{3,000}{4,000} = \frac{3}{4}\)

Shares allotted = 3,000


Step 3: Application money for allotted shares
\(3,000 \times Rs.50 = Rs.1,50,000\)


Step 4: Excess application money

Excess application money \(= Rs.2,00,000 - Rs.1,50,000 = Rs.50,000\)


Step 5: Excess adjusted towards allotment

Amount adjusted in share allotment account is Rs.50,000. Quick Tip: In pro-rata allotment, excess application money is adjusted towards allotment.

Step 1: Total allotment money due

Shares allotted = 3,000

Allotment money per share = Rs.50

Total allotment money = \(3,000 \times Rs.50 = Rs.1,50,000\)


Step 2: Less excess application money adjusted

Excess application money adjusted = Rs.50,000


Step 3: Amount expected to be received at allotment
\[ Rs.1,50,000 - Rs.50,000 = Rs.1,00,000 \] Quick Tip: Amount received on allotment = Total allotment money – excess application adjusted.

Step 1: Shares on which allotment money is unpaid

One shareholder holding 600 shares did not pay allotment money.


Step 2: Amount unpaid per share

Rs.50 per share


Step 3: Calculate allotment arrears
\[ 600 \times Rs.50 = Rs.30,000 \]

However, the answer given is Rs.20,000 (option b), which may indicate partial payment or a typo. But based on data, Rs.30,000 is correct. Please verify.
Quick Tip: Allotment arrears = Number of shares unpaid × Allotment money per share.

Step 1: Shares for final call

3,000 shares


Step 2: Final call amount per share

Rs.20 per share


Step 3: Final call money due
\[ 3,000 \times Rs.20 = Rs.60,0000 \]

Step 4: Add allotment arrears paid with final call

Allotment arrears = Rs.30,000 (from unpaid allotment)


Step 5: Total final call money received
\[ Rs.60,0000 + Rs.30,000 = Rs.6,30,000, \]

The given answer is Rs.80,000 which seems to be inconsistent with data. Please verify or clarify.
Quick Tip: Final call receipts include final call money plus any arrears received on earlier calls.

Step 1: Default interest on calls in arrears

If Articles of Association are silent, the usual rate of interest charged on calls in arrears is generally 10% p.a., as per common practice (sometimes varies by jurisdiction).

Step 2: Conclusion

Hence, rate of interest on calls in arrears is 10% p.a. if no specific agreement exists. Quick Tip: Default interest on calls in arrears may vary but is often considered 10% p.a. when silent.

Step 1: Understand Inventory Turnover Ratio

It measures how efficiently inventory is converted into sales (revenue from operations) during the period.

It is calculated as: \[ Inventory Turnover Ratio = \frac{Cost of Goods Sold}{Average Inventory} \]

Step 2: Conclusion

Therefore, Inventory Turnover Ratio determines the number of times stock is converted into revenue. Quick Tip: Inventory Turnover Ratio indicates stock movement speed relative to sales, key for operational efficiency.

Step 1: Understand Schedule III Balance Sheet format

Shareholder’s Fund (C) comes first under Equity.

Non-Current Liabilities (A) follow next.

Current Liabilities (E) are shown after non-current liabilities.

Non-Current Assets (B) and Current Assets (D) are listed under assets, with non-current assets before current assets.

Step 2: Conclusion

Correct sequence is: C, A, E, B, D. Quick Tip: Schedule III format lists equity and liabilities first, then assets; current liabilities come before assets section.

Step 1: Understand the scenario.

When debentures are issued at par (face value = issue price), but redeemable at a premium, the company incurs a loss because it will pay more at redemption. This future loss is accounted for at the time of issue.

Step 2: Treatment of loss.

This type of loss is recorded under the account "Loss on issue of Debentures A/c" and is shown as a fictitious asset in the balance sheet, to be written off over the years. Quick Tip: Always debit "Loss on issue of Debentures A/c" when debentures are issued at par but redeemable at premium — it’s a capital loss.

We match each term from List I with its correct meaning from List II:

(A) Secured debenture — These are backed by a charge on the assets of the company.
 ⇒ Matches with (III)

(B) Registered debenture — These are debentures recorded in the company’s register in the name of the holder.
 ⇒ Matches with (IV)

(C) Convertible debenture — These can be converted into equity shares at a later date.
 ⇒ Matches with (II)

(D) Unsecured debenture — These are not backed by assets and may not carry a fixed interest rate.
 ⇒ Matches with (I)

So the correct matching is:
A–III, B–IV, C–II, D–I Quick Tip: In matching type questions, it's helpful to recall definitions or key features of financial instruments like debentures — secured means asset-backed, convertible means it turns into shares, and registered means recorded with the issuer.

Step 1: Understanding Comparative Statements.

Comparative statements show financial data for two or more years side by side, allowing comparison across time.

Step 2: Alternate term.

This type of analysis that evaluates changes over different periods is called Horizontal Analysis — hence, comparative statements are also known as horizontal analysis. Quick Tip: Remember: - Comparative = Horizontal (year-wise comparison) - Common-size = Vertical (percentage of total)

Step 1: Understand the context.

When there is a change in the profit-sharing ratio among existing partners (due to admission, retirement, or reconstitution), goodwill already appearing in the books (i.e., existing goodwill) needs to be adjusted.

Step 2: Treatment of existing goodwill.

Existing goodwill is a past accumulated benefit and must be written off among the old partners based on their old profit-sharing ratio to maintain fairness.

Step 3: Rule application.

The correct rule is: \[ Existing goodwill is written off in the old profit-sharing ratio. \] Quick Tip: For reconstitution of a firm, remember: - **Existing goodwill** → written off in **old ratio** - **New goodwill** (due to change) → adjusted via **sacrificing or gaining ratio**

Step 1: Match each item in List I with the correct explanation from List II.

(A) Finance cost refers to the cost incurred on borrowing, mainly interest charges — matches with (IV).

(B) Depreciation is the systematic reduction in the value of fixed assets over time — matches with (I).

(C) Employee benefit expenses includes salary, wages, and leave encashment — matches with (II).

(D) Purchase of Stock in Trade refers to buying goods meant for resale — matches with (III).

Step 2: Verify the correct matching pattern.

Option (d) has: A–IV, B–I, C–II, D–III — which is correct. Quick Tip: Link financial terms with common sense: - Finance cost → interest, - Depreciation → fall in asset value, - Employee expenses → wages/salaries, - Stock in trade → purchase of goods for resale.

Step 1: Understand the fixed capital method.

Under the fixed capital method, each partner maintains two separate accounts:

Capital Account (for initial and additional capital), and

Current Account (for all recurring adjustments like salary, drawings, interest, etc.).

Step 2: Identify the incorrect statement.
Option (c) wrongly states that each partner has only one account under the fixed capital method. That’s actually true under the fluctuating capital method. Quick Tip: In fixed capital method, recurring items go into the current account — capital account stays unchanged unless capital changes.

Step 1: Use the Gross Profit Ratio formula: \[ Gross Profit Ratio = \frac{Gross Profit}{Revenue from Operations} \times 100 \]
Given: Revenue = Rs.60,00,000 and Gross Profit Ratio = 25% \[ Gross Profit = 25% of 60,00,000 = \frac{25}{100} \times 60,00,000 = Rs.15,00,000 \] Quick Tip: Gross Profit Ratio = Gross Profit ÷ Revenue × 100. If cost is given as fraction of revenue, use the remainder as gross profit.

Step 1: Separate credit revenue.

Let credit revenue be Rs. x. Then cash revenue = 0.25x.
So total revenue = \(x + 0.25x = 1.25x = 4,00,000 \Rightarrow x = Rs.3,20,000\)

Step 2: Find average trade receivables.

Closing = Rs.1,00,000,

Opening = Rs.1,00,000 - Rs.40,000 = Rs.60,000
\[ Average Trade Receivables = \frac{1,00,000 + 60,000}{2} = Rs.80,000 \]

Step 3: Apply the formula. \[ Trade Receivables Turnover Ratio = \frac{Credit Revenue}{Average Trade Receivables} = \frac{3,20,000}{80,000} = 4 times \] Quick Tip: Always convert total revenue into credit revenue when cash revenue is part of the mix. Then apply the ratio formula.

Step 1: Understand the scenario.

Drawings are Rs.8,000 each on:

1st April (used for 12 months)

1st October (used for 6 months)


Step 2: Apply the interest on drawings formula: \[ Interest = \frac{Amount \times Rate \times Time (in months)}{100 \times 12} \]

For 1st April drawing: \[ Interest = \frac{8000 \times 6 \times 12}{100 \times 12} = Rs.480 \]

For 1st October drawing: \[ Interest = \frac{8000 \times 6 \times 6}{100 \times 12} = Rs.240 \]

Step 3: Add both amounts. \[ Total Interest = Rs.480 + Rs.240 = Rs.720 \] Quick Tip: When drawings are made on fixed dates, calculate interest separately for each using time (in months) till year-end.

Step 1: Understand the concept.

Hidden goodwill is not recorded in the books, but inferred by comparing implied capital with actual capital.

Step 2: Formula used: \[ Hidden Goodwill = Total Capital of the Firm (based on share) - Combined Actual Capital \]

Step 3: Application.

If the new partner brings in capital as per their share, and the total firm capital implied by that share exceeds the actual capital, the difference is hidden goodwill. Quick Tip: Hidden goodwill arises when no goodwill is shown but can be inferred from capital contributions and profit-sharing.

Step 1: Understand the term.

Minimum Subscription is the least amount that must be raised by a company through issue of shares before it can legally allot those shares.

Step 2: Legal requirement.

As per SEBI guidelines, at least 90% of the issued amount must be subscribed.

Step 3: Difference from other options.

Allotment money is just one installment.

Subscribed capital refers to the total applied amount.

Only option (B) correctly defines the condition for allotment.
Quick Tip: No allotment of shares can be made unless the minimum subscription (at least 90% of issue) is received.

Step 1: Understand the sequence:
C. Issue of Prospectus – Company invites public to apply for shares.
A. Receive Application Money – Interested investors apply with payment.
E. Allotment of Shares – Shares are allotted to successful applicants.
B. Calls in Advance – Shareholders may pay upcoming call(s) early.
D. Final Call of Share – Last installment is demanded.


Step 2: Sequence from above is: C → A → E → B → D
Quick Tip: Always remember the chronological steps: Prospectus → Application → Allotment → Calls → Final call.