B.Com. II (Semester IV) (CBCS Pattern) Examination, 2018
Corporate accounting
Day and Date Wednesday, 12-12-2018 Total Marks 70
Time 10.30 a.m. to 1.00 p.m.
Instructions All questions are compulsory.
Use of calculator is allowed.
Figures to the right indicate full marks.
1. Choose the correct alternatives 14
Increase in working capital is shown under in fund flow statement.
Application of fund Sources of fund
Profit and Loss adjusted A/c Balance Sheet
Premium on redemption of Preference shares can be provided out of
Share Premium A/c Forfeited Shares A/c
Depreciation Reserve None of above
Net Asset value of the share is Rs. 20 and Yield value of share is Rs. 25
then fair value of share is Rs.
25 22.5 30 21
Debenture holders having a floating charge have priority in payment over
Preferential creditors Secured creditors
Unsecured creditors Liquidaton Expenses
Purchase of asset is of the fund.
Source Application
Profit Depreciation
Profit for the last four years is Rs. 20,000; Rs. 80,000; Rs. 90,000 and
Rs. 1,10,000; then the value of goodwill on the basis of 2 years purchase
of the profit will be
2,00,000 1,50,000
2,50,000 75,000
P.T.O.
Seat
No. Set P
Set P
SLR-CO 36 *SLRCO36*
is the legal procedure by which company will be dissolve.
Amalgamation Insolvent
Liquidation All the above
is the important tool for the management for financial analysis
in short period.
Cash flow Fund flow
Depreciation None of the above
Debenture holders are of the company.
Owner Creditors
Debtors Directors
10) Liquidator's final statement of Account is prepared
In all modes of winding up
Only in case of company winding up
In voluntary winding up
Insolvency of company
11) Current assets minus current liabilities
Long term capital
Gross working capital
Net working capital
Fixed capital
12) Redemption of preference share is of fund.
Application Source
Profit All of these
13) A person appointed for liquidation of a company is called
Director Share holder
Liquidator Creditor
14) A statement which shows sources and application of fund is termed as
statement.
Balance Sheet Profit or Loss
Fund flow Working capital
Set P
*SLRCO36* SLR-CO 36
2. Write short notes on 14
Use of cash flow statement.
Need of valuation of shares.
3. The Balance sheet of Anand Ltd., as on 31st March 2004 revealed the
following
Liabilities Rs. A ssets Rs.
Equity Share Capital of Fixed Assets 9,00,000
Rs. 10 each Rs. 8 paid 8,00,000 Less Depreciation
1,10,000 7,90,000
Reserves 2,00,000 Good will 80,000
Profit and Loss A/C 20,000 Current Assets 4,90,000
10% Debentures 1,00,000 Discount on Debentures 10,000
Current Liabilities 2,50,000
Total 13,70,000 T otal 13,70,000
Fixed Assets and Goodwill were revalued at Rs. 7,50,000 and
Rs. 1,00,000 respectively.
The net profit after tax for the immediately preceding three years were
Rs. 1,10,000, Rs. 1,05,000 and Rs. 1,45,000 of which 25% were
transferred to reserves.
A fair return in the industry in which the company is engaged is considered
to be 10%.
Compute the value of company's shares by
Net Assets Method.
Yield Value method. 7
Following particulars are available in respect of the business of Mahesh Co. Ltd.
Profit earned after tax 2000 Rs. 1,20,000
2001 Rs. 1,00,000
2002 Rs. 1,10,000
Normal rate of profit 20%.
Average capital employed Rs. 4,00,000.
Calculate the Value of Goodwill at five years purchase of Super Profit
computed on the basis of past three years profit. 7
Set P
SLR-CO 36 *SLRCO36*
4. Following is the Balance Sheet of Reena Ltd. As on 30th June, 2004.
Balance Sheet
Liabilities Rs. A ssets Rs.
1500 Preference Land and Building 75,000
Shares of Rs. 100 each 1,50,000
4500 Equity Shares of Plant and Machinery 1,80,000
Rs. 100 each Rs. 50 paid 2,25,000
Debentures Furniture 30,000
(having floating charge) 1,20,000
Outstanding Debenture Fitting 15,000
Interest 7,200
Sundry Creditors (on Loose Tools 1,50,000
mortgage of Plant and
Machinery) 90,000
Preferential Creditors 9,300 Stock 75,000
Unsecured Creditors 75,000 Debtors 37,500
Cash in Hand 1,500
Profit and Loss Account 1,12,500
T otal 6,76,500 T otal 6,76,500
The company went into voluntary liquidation as on 30th June 2004.
Preference Dividend was in arrears for one year and as per the Articles of
the company it was to be paid.
The liquidator realised the assets as under
Land and Building Rs. 1,50,000 Loose Tools Rs. 1,27,500
Plant and Machinery Rs. 1,65,000 Furniture Rs. 18,000
Stock Rs. 63,000 Debtors Rs. 31,500
The liquidation expenses amounted to Rs. 8,190.
The liquidator is entitled to remuneration at on the assets realised;
on the amount distributed to unsecured creditors and 10% on the amount
paid to equity shareholders.
In addition to the above liabilities; the liquidator has to pay Rs. 2,700 as
repairs bill of plant and machinery.
Debentures were paid on 31st December 2004.
Prepare Liquidators Final Statement of Account. 14
OR
Set P
XYZ Ltd. issued on 1st January 2003 Rs. 5,00,000; 10% Debentures at
discount and repayable at the end of fifth year at a premium of 6%. The
debenture Redemption fund was created by transferring Rs. 1,00,000 from
profit each year and it was invested in 10% Govt. Securities. Every year the
accounts were closed on 31st December.
You are require to prepare
Debenture Redemption fund A/c
Debenture Redemption fund investment for the first three years. 14
5. Steel company Ltd., issued 50000 Redeemable Preference Shares of Rs. 10
each on 1st January 1998, Redeemable at the option of the company on or
after 31st March 2001, in whole or in part. The following redemption was made
out of profits.
On 31st March 2002 Rs. 1,00,000
On 31st March 2003 Rs. 1,50,000
On 31st March 2004 the company issued 40000, equity shares of Rs. 10 each
at a premium Rs. 2 per share and redeemed the balance of the preference
shares.
Pass Journal Entries to record the above transactions. 14
OR
From the following Balance Sheets of Asha Ltd. Prepare
Statement of changes in Working Capital
Fund Flow statement 14
Balance Sheets
Liabilities 2009 2010 A ssets 2009 2010
Rs. Rs. Rs. Rs.
Equity share Goodwill 1,15,000 90,000
capital 3,00,000 4,00,000
Preference Land and
Share capital 1,50,000 1,00,000 Building 2,00,000 1,70,000
General Reserve 40,000 70,000 Plant 80,000 2,00,000
Profit and Loss Debtors 1,60,000 2,00,000
Account 30,000 48,000
*SLRCO36* SLR-CO 36
Set P
Proposed Dividend 42,000 50,000 Stock 77,000 1,09,000
Creditors 55,000 83,000 Bills
Receivable 20,000 30,000
Bills payable 20,000 16,000 Cash in hand 15,000 10,000
Provision for Cash at bank 10,000 8,000
Taxation 40,000 50,000
Total 6,77,000 8,17,000 T otal 6,77,000 8,17,000
A dditional Information
Depreciation of Rs. 10,000 and Rs. 20,000 have been charged on Plant and
Buildings respectively in 2010.
An Interim Dividend of Rs. 20,000 have been paid in 2010.
Income tax Rs. 35,000 has been paid during the year 2010.