Q1Balance Sheet preparation under Companies Act, 2013
0 marks easy
On 31st March 2022, Hari Ltd. provides the following particulars with additional information about equity shares, assets, liabilities, call in arrears, and unsecured loans. You are required to prepare the Balance sheet of Hari Ltd. as on 31st March, 2022 as per Schedule III to the Companies Act, 2013.
Q2Effective capital computation under Schedule V
0 marks easy
Omega Ltd. provides information including authorized capital, issued capital, reserves, debentures, and assets. You are required to compute effective capital as per the provisions of Schedule V if Omega Ltd is non-investment company. Would your answer differ if Omega Ltd. is an investment company?
Q3Cash Flow Statement preparation - Indirect Method
0 marks easy
Following is the Balance Sheet of Fox Ltd. with assets and liabilities for 31st March 2021 and 2020. You are required to prepare cash flow statement using Indirect Method, given additional information about dividends paid and depreciation charges.
Q4Pre and post-incorporation profit allocation
0 marks easy
M/s New Venture, carrying on business from 1st June, 2021 gets incorporated as a company on 1st October, 2021 with first accounts drawn up to 31st March 2022. Given gross profit of ` 1,20,000 and various expense details. Give statement showing pre and post incorporation profit.
Q5Accounting for Bonus Issue
0 marks easy
Following items appear in the Trial Balance of Satish Limited as on 31st March, 2022: equity shares, capital reserves, securities premium, capital redemption reserve, general reserve, and profit & loss account. The company decided to issue bonus shares at the rate of 1 share for every 3 shares held with minimum reduction in free reserves. Pass necessary Journal Entries in the books of Satish Ltd.
Q6Issue of Right Shares
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A company having 1,00,000 shares of ` 10 each as its issued share capital, and having a market value of ` 46, issues rights shares in the ratio of 1:10 at an issue price of ` 31. Pass journal entry for issue of right shares.
Q7Redemption of Preference Shares under Section 55
0 marks easy
Redemption of Preference Shares.
Q8Redemption of Debentures - purchased in open market
0 marks easy
Alfa Ltd. (listed company) issued ` 3,00,000 5% Debentures on 30th September 20X0 with interest payable half yearly on 31st March and 30th September. The company purchased debentures in the open market for cancellation. Purchases were made on 1st March 20X2 for ` 50,000 nominal value at ` 49,450 ex-interest and on 1st September 20X2 for ` 40,000 nominal value at ` 40,250 cum-interest, with cancellation on the same date. On 31 December 20X0, investments made for redemption were ` 45,000. You are required to draw up the following accounts for the year ended 31st December, 20X2: (i) Debentures Account; and (ii) Own Debentures (Investment) Account. Ignore taxation.
Q9Investment Accounts for Government Securities
0 marks easy
Remo Ltd. held on 1st April, 2021, 1000 9% Government Securities at ` 90,000 (Face Value of Security ` 100 each) with three months interest accrued. Various purchases and sales of government securities occurred during the year with different cum-interest and ex-interest rates. Interest was paid on 30th June and 31st December. You are required to draw up the 9% Government Security Account in the books of Remo Limited using FIFO method. Calculation shall be made to the nearest rupee or multiple thereof.
Q10Insurance Claim for loss of stock
0 marks easy
A fire occurred in the premises of M/s Star & Sons on 21st March 2022. The concern had taken Insurance Policy of ` 75,000 subject to average clause. From books of accounts for 1st April 2021 to March 21st 2022: opening stock ` 1,50,500; purchases ` 3,17,000 (including ` 40,000 for which invoices not received); goods distributed as samples ` 32,000; sales ` 4,55,000 (excluding approval goods valued at ` 35,000); purchase return ` 15,000; wages ` 65,000 (including manager's salary); average gross profit rate 20% on sales; salvaged stock cost ` 12,000. You are required to calculate the amount of claim to be lodged to Insurance Company.
Q11Hire Purchase Transactions
0 marks easy
Hire Purchase Transactions: R (hire purchaser) purchased three machineries from S on hire purchase system at cash price of ` 3,00,000 each. Depreciation charged at 20% on WDV. Two machineries seized when second installment not paid at end of second year, valued at cash price less 30% depreciation per year (WDV). Hire vendor spent ` 15,000 on repairs and sold for ` 2,55,000 total. You are required to compute: (1) Agreed value of two machineries taken back by the hire vendor. (2) Book value of one machine left with the Hire purchaser. (3) Profit or loss to hire purchaser on two machineries taken back. (4) Profit or loss on machineries repossessed when sold by the hire vendor.
Q12Departmental Accounts
0 marks easy
The following balances were extracted from the books of Beta for year ended 31st December, 2022 showing departmental data for A and B with opening stock, purchases, and sales. General expenses for both departments were ` 7,50,000. Given closing stock valuations including inter-departmental transfers and opening stock with inter-departmental transfers. You are required to prepare Departmental Trading Account and general Profit & Loss Account.
Q13Accounting for Branches with foreign currency
0 marks easy
PQR has a branch at Houston (USA) carrying on substantially independent business in local currency. Trial balance of Branch as at 31st March, 2022 provided in US$ with office equipment, furniture, stock, purchases, sales, salaries, expenses, receivables, payables, and cash. Given adjustments for outstanding salaries, depreciation, closing stock, head office receivable, equipment purchased, furniture sold, and exchange rates on different dates (1 US$ = ` 64 on 1.4.2021, ` 70 on 31.12.2021, ` 75 on 31.3.2022, average ` 72). You are required to prepare the trial Balance after incorporating adjustments and converting US$ into rupees.
Q14Accounts from Incomplete Records
0 marks easy
ABC Enterprises requests preparation of Trading and Profit & Loss Account for year ended 31st March, 2022 and Balance Sheet as on that date from incomplete records. Assets and liabilities provided for 1.4.2021 and 31.3.2022, cash transactions during the year including collections, payments, drawings, expenses, and investments. Bills of exchange transactions provided. Goods costing ` 9,000 used as advertising. Goods sold to show 20% gross profit on sales. Provision at 2% for doubtful debts on closing debtors. Cash differences treated as drawings or capital introduction.
Q15Framework for Preparation and Presentation of Financial Stat
0 marks easy
A Ltd. has entered into a binding agreement with Gamma Ltd. to buy a custom-made machine ` 1,00,000. At the end of 20X1-X2, before delivery of the machine, A Ltd. had to change its method of production. The new method will not require the machine ordered and it will be scrapped after delivery with nil expected scrap value. You are required to advise the accounting treatment and give necessary journal entry in the year 20X1-X2.
Q16AS 1 Disclosure of Accounting Policies and AS 2 Valuation of
0 marks easy
Accounting Policies and Valuation of Inventories.
Q17AS 10 Property, Plant and Equipment - Capitalization
0 marks easy
Star Limited purchased machinery for ` 6,80,000 (inclusive of GST of ` 40,000) with full input credit available. Various other expenses incurred for installation including site preparation ` 21,200, labour charges ` 56,000 (200 of 500 hours on installation), spare parts ` 5,000, supervisor salary ` 26,000 (25% time on installation), technical expense ` 34,000 (1/10 relates to installation), test run ` 18,000, consultancy charges ` 11,000, and depreciation on assets used ` 12,000. Machine ready for use on 15.01.2021 but used from 01.02.2021 with further expenses of ` 8,900 due to delay. Calculate the value at which the plant should be capitalized in the books of Star Limited.
Q18AS 11 Effects of Changes in Foreign Exchange Rates and AS 16
0 marks easy
ABC Builders Limited had borrowed a sum of US$ 15,00,000 at the beginning of Financial year 2020-21 for its residential project at London at LIBOR + 4% with interest payable at year-end. Exchange rate at borrowing was ` 72 per US$ and on 31st March, 2021 was ` 76 per US$. If borrowed in Indian Rupees, pricing would have been 9.50%. LIBOR applicable is 1%. Compute Borrowing Cost and exchange difference for the year ending 31st March, 2021 as per applicable Accounting Standards.
Q19AS 12 Accounting for Government Grants and AS 13 Accounting
0 marks easy
Government Grants and Investments.
Q20AS 16 Borrowing Costs - Interest capitalization
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Expert Limited issued 12% secured debentures of ` 100 lakhs on 01.06.2021 to be utilized for: Construction of factory building ` 40 lakhs, Working Capital ` 30 lakhs, Purchase of Machinery ` 15 lakhs, Purchase of Furniture ` 2 lakhs, Purchase of truck ` 13 lakhs. Interest on debentures for 2021-2022 was paid. Company invested idle fund of ` 5 lakhs in Bank's fixed deposit earning ` 50,000 interest. Factory construction not completed by March 2022 (6 more months expected). Machinery installed and ready by March 2022. Furniture put to use at end of March 2022. Truck to be received in April 2022. You are required to show the treatment of interest as per AS 16 in respect of borrowing cost for the year ended 31st March, 2022 in the Books of Expert Limited.