QbDepartmental Accounting
4 marks medium
Sona Ltd. has three departments – P, Q and R. From the following particulars given below, compute:
(i) The departmental results;
(ii) The value of stock as on 31st December, 2014;
Particulars | P | Q | R
Stock as on 01.01.2014 | 30,000 | 45,000 | 15,000
Purchases | 1,60,000 | 1,30,000 | 60,000
Actual Sales | 1,88,000 | 1,66,000 | 93,000
Gross Profit on normal sales price | 25% | 33⅓% | 40%
During the year 2014 some items were sold at discount and these discounts were reflected in the above sales value. The details are given below:
Particulars | P | Q | R
Sales at normal price | 15,000 | 8,000 | 6,000
Sales at actual price | 11,000 | 6,000 | 4,000
QbCompany Liquidation
4 marks medium
What are the contents of 'Liquidators' statement of account'?
QcBanking Regulation
4 marks medium
Specify the conditions when cash credit overdraft account is treated as 'Out of order'?
QdForeign currency loan, borrowing cost calculation, exchange
5 marks medium
Shan Builders Limited has borrowed a sum of US $ 10,00,000 at the beginning of Financial Year 2014-15 for its residential project at LIBOR + 3%. The interest is payable at the end of the Financial Year. At the time of availment, exchange rate was ₹ 56 per US $ and the rate as on 31st March, 2015 was ₹ 62 per US $. If Shan Builders Limited borrowed the loan in India in Indian Rupee equivalent, the pricing of loan would have been 10.50%. Compute Borrowing Cost and exchange difference for the year ending 31st March, 2015 as per applicable Accounting Standards. (Applicable LIBOR is 1%)
QdCompany Liquidation
4 marks medium
Write the LISTS which should accompany the Statement of Affairs, in case of a winding up by Court.
QeBranch Accounting
4 marks medium
Pass necessary Journal Entries (with narration) in the books of branch to rectify or adjust the following:
(i) Branch Paid ₹ 24,000 as salary to HO Supervisor and the amount was debited to Salaries Account by the branch.
(ii) Head Office Expenses allocated to branch were ₹ 22,500, but these expenditure were not recorded by the branch.
(iii) HO collected ₹ 50,000 directly from the customer on branch's behalf.
(iv) Branch has sent remittance of ₹ 1,20,000 but the same has not yet been received by HO.
Q1AS 11 - Accounting for Foreign Exchanges; Lease Classificati
20 marks very hard
Answer the following questions:
Q2Partnership dissolution, company formation, goodwill calcula
16 marks very hard
Case: Partnership firm conversion to company with goodwill valuation and partner retirement
Yash, Tanish and Ruchika were partners sharing Profit & Loss in ratio of 3:2:1. Balance Sheet of the firm as on 31st March, 2014:
Liabilities: Fixed Capital - Yash ₹ 50,000, Tanish ₹ 20,000, Ruchika ₹ 10,000; Current Accounts - Yash ₹ 6,000, Ruchika ₹ 4,000; Unsecured Loans ₹ 15,000; Current Liabilities ₹ 15,000. Total ₹ 1,20,000
Assets: Fixed Assets ₹ 45,000; Investments ₹ 15,000; Current Assets - Stock ₹ 10,000, Debtors ₹ 27,500, Cash & Bank ₹ 12,500; Current Account - Tanish ₹ 10,000. Total ₹ 1,20,000
On 1st April, 2014 all the partners agreed to form a new company YTR Pvt. Ltd., which shall take over the firm as going concern including goodwill, but excluding cash and bank balances. The following matters were also agreed upon:
(i) Goodwill shall be valued at 3 years' purchase of super profits.
(ii) Actual profit for the purpose of goodwill valuation will be ₹ 20,000.
(iii) The normal rate of return will be 17.50% per annum of Fixed Capital.
(iv) All other Assets and Liabilities will be taken over at book value.
(v) The purchase consideration will be paid partly in share of ₹ 1 each and partly in cash. Yash and Tanish to acquire interest in new company in the ratio of 3:2 at face value. Ruchika agreed to retire after taking her share in cash.
(vi) Realisation expenses amounted to ₹ 5,000.
Prepare Realisation Account, Cash and Bank Account, YTR Private Limited Account and Capital Accounts of the partners.
Q3Profit & Loss Account preparation - non-going concern basis
0 marks hard
Case: VFS company with various adjustments needed for non-going concern basis
Based on the following information about VFS:
(ii) Firm's sales and purchases for the year 2014-15 amounted to ₹ 5 lacs and ₹ 4.50 lacs respectively.
(iii) The cost and net realizable value of the stock were ₹ 34,000 and ₹ 38,000 respectively.
(iv) General Expenses for the year 2014-15 were ₹ 16,500.
(v) Deferred Expenditure is normally amortized equally over 4 years starting from F.Y. 2013-14 i.e. ₹ 5,000 per year.
(vi) Out of debtors worth ₹ 10,000, collection of ₹ 4,000 depends on successful re-design of certain product already supplied to the customer.
(vii) Closing trade payable is ₹ 10,000, which is likely to be settled at 95%.
(viii) There is pre-payment penalty of ₹ 2,000 for Bank loan outstanding.
Prepare Profit & Loss Account for the year ended 31st March, 2015 by assuming it is not a Going Concern.
Q5(a)Insurance Accounting / Revenue Account / Marine Insurance
12 marks very hard
Prepare Revenue Account of M/s Ishan Insurance Co. engaged in marine insurance business:
Q6(a)Branch Accounting
12 marks very hard
Raju Industries, Kolkata has a branch in Delhi to which office goods are invoiced at cost plus 25%. The branch sells both for cash and on credit. Branch expenses are paid direct from head office, and branch has to remit all cash received to the Head office Bank Account. From the following details, relating to calendar year 2014, prepare the accounts in the Head Office Ledger and ascertain the Branch Profit. Branch does not maintain any books of account, but sends weekly returns to the Head Office. Goods received from Head Office at Invoice Price: ₹ 6,00,000; Returns to Head Office at Invoice Price: ₹ 12,000; Stock at Delhi as on 1st Jan., 2014: ₹ 60,000; Sales during the year - Cash: ₹ 1,80,000; Credit: ₹ 3,80,000; Sundry Debtors at Delhi as on 1st Jan., 2014: ₹ 72,000; Discount allowed to debtors: ₹ 8,000; Bad Debts in the year: ₹ 6,000; Sales returns at Delhi Branch: ₹ 6,000; Rent, Rates, Taxes at Branch: ₹ 16,000; Salaries, Wages, Bonus at Branch: ₹ 62,000; Office Expenses: ₹ 6,000; Stock at Branch on 31st December, 2014: ₹ 1,20,000.
Q7Company Reconstruction / Scheme / Journal Entries
0 marks hard
Case: A reconstruction scheme was prepared and duly approved with the following features: (i) Paid up value of 8% Preference Share to be reduced to ₹ 80, dividend rate raised to 9%. (ii) Equity share paid up value reduced to ₹ 10. (iii) Directors refund ₹ 50,000 fees. (iv) Debenture holders forego ₹ 26,000 interest. (v) Preference shareholders waive arrear dividends for 3 years. (vi) B 6% Debenture holders take over Chennai Works at ₹ 4,25,000, receive 1,500 shares of ₹ 10 each, and form Zia Ltd which allots 9,000 shares of ₹ 10 each to Star Ltd. (vii) Chennai Worksmen's compensation fund has actual…
A reconstruction scheme was prepared and duly approved. The salient features of the scheme were as follows: (i) Paid up value of 8% Preference Share to be reduced to ₹ 80, but the rate of dividend being raised to 9%. (ii) Paid up value of Equity Shares to be reduced to ₹ 10. (iii) The directors to refund ₹ 50,000 of the fees previously received by them. (iv) Debenture holders forego their interest of ₹ 26,000 which is included among the Sundry Creditors. (v) The preference shareholders agreed to waive their claims for preference share dividend, which is in arrears for the last three years. (vi) "B" 6% Debenture holders agreed to take over the Chennai Works at ₹ 4,25,000 and to accept an allotment of 1,500 equity shares of ₹ 10 each at par, and upon their forming a company called Zia Ltd. (to take over the Chennai Works), they allotted 9,000 equity shares of ₹ 10 each fully paid at par to Star Ltd. (vii) The Chennai Worksmen's compensation fund disclosed that there were actual liabilities of ₹ 1,000 only. As a consequence, the investments of the fund were realized to the extent of the balance. Entire investments were sold at a profit of 10% on book value and the proceeds were utilized for part payment of the creditors. (viii) Stock was to be written off by ₹ 1,90,000 and a provision for doubtful debts is to be made to the extent of ₹ 20,000. (ix) Chennai works completely written off. (x) Any balance of the Capital Reduction Account is to be applied as two-thirds to write off the value of Bombay Works and one-third to Capital Reserve. Pass necessary Journal Entries in the books of Star Ltd. after the scheme has been carried into effect.
Q7(a)Weighted Average Number of Shares
4 marks medium
What do you mean by 'Weighted average number of equity shares outstanding during the period' and why is it required to be calculated? Compute weighted average number of equity shares in the following case:
1st April, 2014 | Balance of Equity Shares | 500000
30th June, 2014 | Equity Shares issued for cash | 100000
15th January, 2015 | Equity Shares bought back | 50000
31st March, 2015 | Balance of Equity Shares | 550000
Q9(b)Banking/Bills of Exchange/Journal Entries
4 marks medium
ABC Bank Ltd. has a balance of ₹ 40 crores in "Rebate on bills discounted" account as on 31st March, 2014. The Bank provides you the following information: (i) During the financial year ending 31st March, 2015 ABC Bank Ltd. discounted bills of exchange of ₹ 5000 crores charging interest @ 14% and the average period of discount being 146 days. (ii) Bills of exchange of ₹ 500 crores were due for realization from the acceptors/customers after 31st March, 2015. The average period of outstanding after 31st March, 2015 being 73 days. These bills of exchange of ₹ 500 crores were discounted charging interest @ 14 % p.a. You are requested to pass necessary Journal Entries in the books of ABC Bank Ltd. for the above transactions.