Class 12 Accountancy PY Paper 2027 — Solved Questions
Prepare for your MP Board Class 12 Accountancy exam 2027 with this fully solved previous year question paper. This post covers all sections from the latest MP Board Accountancy paper — Objective (1 mark), Very Short Answer (2 marks), Short Answer (3 marks), and Long Answer (5 marks) questions — with detailed solutions and explanations to help you score maximum marks.
📑 Table of Contents
📋 Paper Overview & Exam Pattern
The MP Board Class 12 Accountancy exam is divided into four sections. The total marks are 100, and the time duration is 3 hours 15 minutes (including 15 minutes for reading the paper). Below is the marks distribution:
| Section | Type of Questions | Number of Questions | Marks per Question | Total Marks |
|---|---|---|---|---|
| A | Objective / Multiple Choice | 10 | 1 | 10 |
| B | Very Short Answer | 5 | 2 | 10 |
| C | Short Answer | 10 | 3 | 30 |
| D | Long Answer | 6 | 5 | 30 |
| Internal Assessment (Practical + Project) | — | 20 | ||
| Grand Total | 100 | |||
A. Objective Questions (1 Mark Each)
Choose the correct option for each question. Each question carries 1 mark.
Q1. Which of the following is a method of depreciation?
- (a) Straight Line Method
- (b) Written Down Value Method
- (c) Both (a) and (b)
- (d) None of the above
Answer: (c) Both (a) and (b)
Explanation: Both Straight Line Method and Written Down Value Method are recognized methods of charging depreciation under the Companies Act 2013. SLM charges equal depreciation every year, while WDV charges decreasing depreciation.
Q2. Goodwill of a partnership firm is classified as:
- (a) Current Asset
- (b) Tangible Fixed Asset
- (c) Intangible Fixed Asset
- (d) Fictitious Asset
Answer: (c) Intangible Fixed Asset
Explanation: Goodwill is an intangible asset because it has no physical existence but has a monetary value. It represents the reputation and earning capacity of the business.
Q3. Under which method are debentures redeemed by paying in installments?
- (a) Lump Sum Method
- (b) Draw by Lot Method
- (c) Purchase in Open Market
- (d) Convertible Method
Answer: (b) Draw by Lot Method
Explanation: In Draw by Lot method, debentures are redeemed in installments — a certain number of debentures are selected by lottery each year and paid off. This reduces the company’s liability gradually.
Q4. Which ratio measures the short-term liquidity of a business?
- (a) Current Ratio
- (b) Debt-Equity Ratio
- (c) Gross Profit Ratio
- (d) Working Capital Turnover Ratio
Answer: (a) Current Ratio
Explanation: Current Ratio (Current Assets ÷ Current Liabilities) is the most widely used liquidity ratio. A ratio of 2:1 is considered ideal for most businesses.
Q5. What is the journal entry for goods withdrawn by the proprietor for personal use?
- (a) Debit Purchases A/c, Credit Drawings A/c
- (b) Debit Drawings A/c, Credit Purchases A/c
- (c) Debit Sales A/c, Credit Drawings A/c
- (d) Debit Drawings A/c, Credit Sales A/c
Answer: (b) Debit Drawings A/c, Credit Purchases A/c
Explanation: Drawings account is debited because the proprietor has taken goods for personal use (reducing capital). Purchases account is credited because goods are going out of the business.
B. Very Short Answer Questions (2 Marks Each)
Q6. What is the difference between Provision and Reserve?
Answer:
| Basis | Provision | Reserve |
|---|---|---|
| Purpose | For known liability/expense | For strengthening financial position |
| Compulsory? | Yes, legally required | No, created voluntarily |
| Profit Appropriation | Charged to P&L A/c | Appropriation of profit |
Q7. What is meant by ‘Calls in Arrears’?
Answer: Calls in Arrears refers to the amount called up by the company on shares but not yet paid by the shareholders. It is shown as a deduction from Share Capital in the Balance Sheet.
Explanation: When a company makes a call (e.g., Rs. 30 per share) and some shareholders fail to pay, the unpaid amount is called ‘Calls in Arrears’. It reduces the paid-up capital from the subscribed capital.
Q8. Define ‘Gaining Ratio’. When is it calculated?
Answer: Gaining Ratio is the ratio in which the remaining partners gain the share of a retiring or deceased partner. It is calculated when a partner retires or dies.
Formula: Gaining Ratio = New Share − Old Share. The gaining partners compensate the retiring partner through goodwill adjustment.
C. Short Answer Questions (3 Marks Each)
Q9. A, B and C are partners sharing profits in 3:2:1. B retires. A and C decide to share future profits equally. Calculate gaining ratio.
Answer:
Step 1: Old ratio (A:B:C) = 3:2:1 = 3/6, 2/6, 1/6
Step 2: New ratio (A:C) after retirement = 1:1 = 1/2, 1/2
Step 3: Gaining Ratio = New Share − Old Share
A’s gain = 1/2 − 3/6 = 3/6 − 3/6 = 0
C’s gain = 1/2 − 1/6 = 3/6 − 1/6 = 2/6
Gaining Ratio (A:C) = 0:2/6 = 0:1, i.e., only C gains.
Q10. Pass journal entries for issue of 1,000, 9% debentures of Rs. 100 each at a discount of 10%, redeemable at par.
Answer:
| Date | Particulars | L.F. | Dr. (Rs.) | Cr. (Rs.) |
|---|---|---|---|---|
| Bank A/c Dr. | 90,000 | |||
| Discount on Issue of Debentures A/c Dr. | 10,000 | |||
| To 9% Debentures A/c | 1,00,000 | |||
| (Being 1,000 debentures of Rs. 100 each issued at 10% discount) |
Explanation: Bank receives Rs. 90,000 (1,000 × Rs. 90). Discount of Rs. 10,000 (1,000 × Rs. 10) is debited to Discount on Issue of Debentures A/c. The debentures are credited at face value of Rs. 1,00,000 (1,000 × Rs. 100).
Q11. From the following information, calculate the Current Ratio: Current Assets = Rs. 1,50,000; Current Liabilities = Rs. 60,000; Inventory = Rs. 40,000; Prepaid Expenses = Rs. 10,000.
Answer:
Current Ratio = Current Assets ÷ Current Liabilities
= Rs. 1,50,000 ÷ Rs. 60,000
= 2.5 : 1
Current Ratio = 2.5 : 1
Note: A current ratio of 2.5:1 is above the ideal 2:1, indicating a comfortable liquidity position. Quick Ratio would exclude inventory and prepaid expenses: (1,50,000 − 40,000 − 10,000) ÷ 60,000 = 1.67:1.
D. Long Answer Questions (5 Marks Each)
Q12. X, Y and Z are partners sharing profits and losses in the ratio of 3:2:1. Their Balance Sheet as on 31st March 2027 shows: Capital — X: Rs. 80,000; Y: Rs. 60,000; Z: Rs. 40,000. General Reserve: Rs. 30,000. Y retires and goodwill of the firm is valued at Rs. 60,000. X and Z decide to share future profits equally. Pass necessary journal entries and calculate Y’s share payable.
Answer:
Step 1: Goodwill Adjustment
Y’s share of goodwill = Rs. 60,000 × 2/6 = Rs. 20,000
Gaining Ratio: X’s gain = 1/2 − 3/6 = 0, Z’s gain = 1/2 − 1/6 = 2/6
Only Z gains, so Z will compensate Y entirely.
Journal Entries:
| Particulars | Dr. (Rs.) | Cr. (Rs.) |
|---|---|---|
| Z’s Capital A/c Dr. | 20,000 | |
| To Y’s Capital A/c | 20,000 | |
| (Being Y’s share of goodwill adjusted through gaining partner Z) | ||
| General Reserve A/c Dr. | 30,000 | |
| To X’s Capital A/c (3/6) | 15,000 | |
| To Y’s Capital A/c (2/6) | 10,000 | |
| To Z’s Capital A/c (1/6) | 5,000 | |
| (Being General Reserve distributed among partners in old ratio) |
Step 3: Y’s Total Amount Due
| Particulars | Amount (Rs.) |
|---|---|
| Capital A/c Balance | 60,000 |
| Add: Goodwill | 20,000 |
| Add: General Reserve Share | 10,000 |
| Total Amount Due to Y | 90,000 |
Q13. Prepare a Comparative Statement of Profit & Loss from the following information:
| Particulars | 2025-26 (Rs.) | 2026-27 (Rs.) |
|---|---|---|
| Revenue from Operations | 5,00,000 | 6,50,000 |
| Other Income | 30,000 | 40,000 |
| Cost of Materials Consumed | 2,50,000 | 3,25,000 |
| Employee Benefit Expenses | 80,000 | 95,000 |
| Depreciation | 30,000 | 40,000 |
| Other Expenses | 20,000 | 25,000 |
| Tax Rate | 30% | 30% |
Solution:
| Particulars | 2025-26 | 2026-27 | Absolute Change | % Change |
|---|---|---|---|---|
| Revenue from Operations | 5,00,000 | 6,50,000 | +1,50,000 | +30.0% |
| Other Income | 30,000 | 40,000 | +10,000 | +33.3% |
| Total Revenue | 5,30,000 | 6,90,000 | +1,60,000 | +30.2% |
| Less: Total Expenses | (3,80,000) | (4,85,000) | (+1,05,000) | +27.6% |
| Profit Before Tax | 1,50,000 | 2,05,000 | +55,000 | +36.7% |
| Less: Tax @ 30% | (45,000) | (61,500) | (+16,500) | +36.7% |
| Profit After Tax | 1,05,000 | 1,43,500 | +38,500 | +36.7% |
Analysis: Revenue increased by 30.2% while expenses increased by only 27.6%, leading to a 36.7% increase in net profit — indicating improved operational efficiency.
📌 Preparation Tips for Accountancy
- Master the Basics: Understand the golden rules of accounting — Personal, Real, and Nominal accounts. Every journal entry is built on these.
- Practice Ratios Daily: Liquidity, Solvency, Profitability, and Turnover ratios are scoring topics. Memorize the formulas and practice at least 3-4 ratio problems daily.
- Focus on Partnership Accounting: Retirement, admission, and goodwill adjustments carry heavy weightage (15-20 marks in Section D).
- Write Format Properly: In long answer questions, always write proper headings, ledger folio, and narration marks. Presentation earns 1-2 extra marks.
- Solve Previous Year Papers: At least 5 years of past papers will help you understand the question pattern and frequently repeated topics.
🎯 Key Takeaways
- Section A (MCQs) — focus on concepts like depreciation methods, types of assets, and basic definitions.
- Section B (2 marks) — know the difference between similar terms (Provision vs Reserve, Shares vs Debentures).
- Section C (3 marks) — numerical problems on ratios, goodwill, and journal entries are commonly asked.
- Section D (5 marks) — practice full-length partnership retirement/admission problems and comparative statements.
- Always show working notes — even partial marks are awarded for correct steps.
📄 Download full Accountancy PY Paper PDF
Get the complete MP Board Class 12 Accountancy 2027 question paper with solutions in PDF format.