BCom In Accounting & Finance (BCAF) SEM V 2018 19 May 2018-19 Financial Accounting V Question Paper - Mumbai University | munotes

Questions asked in this paper

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1. Q2 Question no. 2 to Question no.5 have internal option
2. Q3 Working notes should form part of your answer
3. Q4 Use of simple calculator is allowed
4. Q5 Figure to the right indicate full marks
5. Q1 A) Fill in the blanks (Rewrite sentences) any 8 8 marks
6. Q1 According to AS-14, Amalgamation fall in to two categories
   • a) Merger & Purchase
   • d) Amalgamation & absorption
7. Q2 Under the polling of interest Method, the difference between the purchase consideration and share capital of transferee company should be adjusted to
   • a) General reserve
   • b) Goodwill Capital reserve
   • c) Amalgamation adjustment A/c
   • d) None of the Above
8. Q3 Ininternal reconstruction
   • a) Nocompany is liquidated
   • b) One or more companies go in to liquidation
   • d) Only goes into liquidation
9. Q4 Oncancellation of surrendered shares in a scheme of reconstruction
   • a) Share capital A/c will be debited
   • b) No entry.is passed Capital reduction A/c will be credited
   • d) Share surrender A/c will be credited 5). According to the companies Act. the underwriting commission on shares should not exceed
   • a) 5 percent
   • c) 10 percent If the whole of the issue of shares or debentures is underwritten it is known as
   • a) Complete under writing
   • b) Partial under writing
   • c) Sole under writing
   • d) . None of the above
   • Q.P. Code :01578
10. Q7 List H shows
    • b) Preferential creditors
    • c) Deficiency or surplus Account
    • d) above
11. Q8 Statement of affairs should be prepared in the format prescribed in
    • a) Form 153
    • b) Form 156
    • d) Schedule VI
12. Q9 Acompany can buy back
    • a) Equity shares
    • b) Preference shares
    • c) Both
    • d) None of the Above
13. Q10 Which of the following is not a free reserve
    • a) Profit & Loss A/c
    • b) General Reserve
    • c) Revaluation reserve
14. Q1 B) State whether given statement are True or False (Rewrite sentence) any 7 7 marks
15. Q1 Under External reconstruction, there is one liquidation and one formation
16. Q2 AS-14 does not distinguish between amalgamation and absorption
17. Q4 cost of reorganization of the share capital is to be charged from capital reduction Account 5). Under firm underwriting, the underwriters do not agree to purchase any shares The underwriting commission is payable in cash
18. Q7 Only insolvent companies can be liquidated
19. Q8 Local Taxes are an examples of secured creditors
20. Q9 redemption reserve be utilized for issuing partly paid bonus shares
21. Q10 Buy back of shares decreases the earning per share (EPS) of the company
    • Q.P. Code :01578
22. Q2 following were the Balance Sheets of B Ltd, & D Ltd. As on 31sst December, 2007: (Rs. In 13% Preference Share of Rs.100 each | 7,500 | ------- | Goodwill 250 of Rs.10each | 5,000 | Machinery 34510 On the above mentioned date, B Ltd. Merged with The absorption took place on the following 15 marks
23. Q1 The absorbed company was allotted 75,000 14% Preference Shares of Rs.10 each and 45 lakh fully paid Equity Shares of Rs.10 each to satisfy the claims of the preference shareholders and equity shareholders of the absorbed company respectively. It was also agreed to convert the debentures of the absorbed company into 13% Debentures of identical amount
24. Q2 Expenses of liquidation of B Ltd. Rs. 10,000 were borne by D Itd
25. Q3 Export Profit Reserve would be required for four more years
26. Q4 Included in the bills payable of D Ltd. Are bills amounting to Rs. 50,000 accepted in favor of B Ltd. For goods purchased. Of these mentioned bills of Rs. 50000 bills of Rs 15000 only still remain on the date of absorption in the hands of B Ltd. The rest having being endorsed in favour of creditors or got discounted with the bank Pass journal and prepare the balance sheet of the absorbing company after all the above transactions have been recorded
27. Q2 Balance Sheet of Mars Limited March,2011 was as follows: 1,00,000 Equity Shares of Rs.100 each fully paid 10,00,000 | Land and Building 7,64,000 Reserves and Surplus: Stock 7,75,000 Current Liabilities and Provisions: 2,52,000 | Cash at Bank 3,29000 Provisions for Income Tax 2,26,000 15 marks
    • Q.P. Code :01578 On 1* April 2011, Jupiter Limited agreed to absorb Mars Limited on the following terms and
28. Q1 Jupiter Limited will take over the assets at the following values: Land and building 10,80,000
29. Q2 Purchase consideration will be settled by Jupiter Ltd. As under: 4,100 fully paid 10% Preference Shares of Rs.100 will be issued and the balance will-be settled by issuing Equity Shares of Rs.10 each at Rs. 8 paid-up
30. Q3 Liquidation expenses are to be reimbursed by Jupiter Ltd. to the extent of Rs. 5,000
31. Q4 Sundry Debtors realized Rs. 1,50,000. Bill Payable were settled for Rs. 38,000. Income Tax authorizes Fixed the taxation liability at Rs.2,22,000 and the same was paid
32. Q5 Creditors were finally settled with cash remaining after meeting liquidation expenses amounting to Rs.8,000 You are required to:
    • i) Calculate the number of Equity shares and Preference Shares to be allotted by Jupiter Limited in discharge of Purchase Consideration
    • ii) Prepare the Realization account, equity Shareholders Jupiter Limited’s accent in the books of Mars Ltd The balance sheet of Badluck Ltd. As on March 2011 was as follows: 15 8,000 of Rs. 10 80,000 | Land & Building 25,000 12,000 Equity shares of Rs.10 each 1,20,000 | Other Fixed Assists 2,00,000 Interest outstanding of Debentures Profit & Loss Account 58,000 The company went into voluntary liquidation on that date, prepare the liquidator’s statement of account after taking into account the following:
    • a) Liquidation expenses and liquidator’s remuneration amounted to Rs.3,000 and Rs.10,000 Bank Loan was secured by pledge of stock
    • c) interest thereon are secured by a floating charge on all assets
    • d) assets were realized at book value and current assets at 80% of book value
    • Q.P. Code :01578 PRIVATE LIMITED has prepared the Summary Balance Sheet as on March 2012 reading as: 15 (in Shares of Rs.10 each) Equity | 5,00,000 | Premises 4,00,000 It is observed that the new product launched by the company has not succeeded even after three Years of marketing. The management is of the opinion that assets and liabilities are not valued correctly and also finds it difficult to raise finances To overcome this situation a scheme of Reconstruction is prepared by Directors and approved by all The salient features of Scheme are:
33. Q1 Plant and equipment having book value of Rs. 1,00,000 is obsolete. This is sold as scrap for
34. Q2 The auditors have pointed out that depreciation on plant is not provided to the extent of
35. Q3 Stock includes items valued at Rs.60,000 which is sold at a loss of 50%
36. Q4 The present realizable value of investment is Rs. 70,000
37. Q5 preference shares is in arrears for.3 years. This amount is not payable
38. Q6 fictitious assets are to be written off expenses paid for forming and implementing scheme is Rs.10,000
39. Q8 The paid up value of equity shares is reduced to Rs. 2 per share and preference share to
40. Q9 The creditors dues are settled as 40% amount is cancelled 40% New 16% Debenture to be issued
41. Q10 The expenses payable include Rs.50,000 payable to directors towards remuneration. This liability is to be cancelled
42. Q11 A call of Rs.3 per share on equity shares is made. It is paid by all shareholders
43. Q12 15% Debentures agree for issue of 10,000 equity shares of Rs.5 paid up for cash
44. Q13 Bank overdraft is paid off to the extent possible Your are required to show
    • i) Journal Entries and
    • Q.P. Code :01578
45. Q4 is the summarized balance of ISL Itd. as on March 2017 6,000 Equity Shares of Rs.100 each, Rs.90 paid up | Fixed Assets 5,00,000 1,200 Preference Shares of Rs.100 each fully paid 1,20,000 | Investments 1,00,000 Capital Redemption Reserve Cash in hand 2,70,000 The company passed a resolution to buy back 10% of its equity capital at 10% Premium out of profits available. To finance the buy back the company sold 60% of the investments at a loss of Rs.4,000. After the buyback company decided to issue bonus shares in the ratio of 1:2. Pass Journal Entries and prepare the 15 marks
46. Q4 Ltd. came out with an issue of 45,00,000 Equity shares of Rs.10 each premium of Rs.2 per share. The promoters took 20% of the issue and the balance was offered to the Public. The issue was underwritten Each underwriter took firm underwriting of 1,00,000 shares each. Subscription for 31,00,000 Equity shares were received with marked forms for the underwriters as given below: The eligible for a commission of 5% of face value of shares. The entire amount towards shares subscription has to be paid along wide application. You are required to: 15 marks
    • a) Compute the underwriter’s liability (number of shares) Computer the amounts payable or due to underwriters; and
    • c) Pass necessary journal entries in the books of Scorpio Ltd. relating to underwriting
47. Q5 A) What do you mean by liquidation of company? Describe the different modes of winding up. 8 marks
    • B) Explain the objective of Buy back and also state the maximum limits of buy back. 07 Write short notes on: (Any Three) 15
    • A) Preferential creditor
    • B) Firm underwriting
    • C) Net Asset Method of Calculating Purchase Consideration
    • D) Sub-Division & consolidation of shares during Internal Reconstruction
    • E) Sources of Buy- Back

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