BCom TY BCom Sem 5 BCom Sem 5 (2018 2019) Oct 2019 AND AUDITING VII FIN. ACC Question Paper - Mumbai University | munotes

Questions asked in this paper

• (2) Figures to the right indicate full marks

1. Q1 A Debt Equity Ratio after buyback of shares should be maintained up to 2:1 as per
2. Q2 Reduction in Liability is debited to Capital Reduction A/c
3. Q3 Investment Accounting is governed by AS 13 marks
4. Q4 In personal investment accounting, dividend received on shares for pre-acquisition period is treated as revenue gain
5. Q5 Goodwill is classified as Fixed Asset under the Companies Act
6. Q6 As per CSR policy it is mandatory for certain companies to spend 5% of their average net profit of three immediately preceding financial years
7. Q7 Law has a legal binding but Ethics do not have a binding nature
8. Q8 Consolidation of shares results in profit for a company
9. Q9 Interest Paid is disclosed under Finance Cost in Profit and Loss A/c
10. Q10 For a company, dividend paid is an expense
11. Q12 Public deposit is secured loan 1(B) Rewrite the following sentences choosing the correct answer (Attempt any 10) (10)
12. Q1 Bills receivable is shown under in Balance Sheet
13. Q2 Internal reconstruction is done as per section of Companies Act
14. Q3 Buyback of equity shares can be of paid up shares (Fully/ Fully and Partly both)
15. Q5 The term ‘Ethics’ comes from word
16. Q6 Accounting Standard Board is constituted by
17. Q7 The premium received on sale of Rights is credited to A/c
18. Q8 A company cannot buy back more than of its own funds
19. Q9 Reconstruction expenses are to Capital Reduction A/c Paper Subject Code: 23101 Financial Accounting and Auditing VII Financial Accounting
20. Q10 The final accounts of companies are to be prepared in accordance with the provisions
21. Q11 Arrears of preference dividend is shown under___ Liabilities
22. Q12 Current investments are valued at cost or market value whicheveris
23. Q2 The following is the Balance Sheet of Mayuresh Ltd. as on 31-03-2018: 8,00,000 Equity Shares of Land and Buildings 40,00,000 each fully paid 80,00,000 | Plant & Machinery 36,00,000 Reserves and Surplus: Furniture and Fixtures 22,00,000 Profit and Loss Account 50,00,000 | Advances The Company decides to buy back the maximum number of equity shares as may be permitted by law at a price of per share, being the current market price. Investments are sold out at a loss of 20% You are required to pass journal entries (without narration) in the books of Mayuresh Ltd assuming that buy back is carried out. Also prepare Notes to Accounts with respect to Reserves and Surplus and Cash and Cash equivalent as on March 2018 (Do not prepare Balance Sheet) (15)
24. Q2 The summarized Balance Sheet of Shalaka Ltd. as on 31-03-2018 is as follows: 6,00,000 Equity shares of each fully paid 60,00,000 Paper Subject Code: 23101 Financial Accounting and Auditing Financial Accounting Ascertain the maximum number of equity shares the company can buy back at the maximum possible price under the law as on March 2018 Assuming the buyback is actually carried out, record the journal entries (without narration) in the books of Shalaka Ltd. Also prepare Notes to Accounts with respect to Share Capital and Reserves and Surplus as on 31 March 2018.(Do not prepare Balance Sheet) (15)
25. Q3 The following is the trial balance of Rahul Ltd.as on March 31, 2018 Purchases and Sales 3,45,000 4,00,000 Equity Share Capital : 10,000 Shares of each - 1,00,000 Debtors and Creditors 37,500 17,500 Cash at Bank 16,200
    • a) Stock on March, 2018 is valued at
    • b) Purchases include %5,000 machinery purchased on 1-10-2017
    • c) On 31-3-2018 good worth %30,000 were sold to a customer. He has taken away the goods. But no entry is recorded
    • d) Directors proposed 10% final dividend (excluding the interim dividend already paid)
    • e) Provide Income Tax for the year
    • f) Transfer to General Reserve Prepare Statement of Profit and Loss and Balance Sheet in vertical format along with notes to Accounts after taking into account the above information. 15) 3A. The authorized share capital of a Tarzan Ltd. is divided into 50,000 8% preference shares of each and 5,00,000 equity shares of each. 50% of each class of shares were issued to the public fully called up. per share on 1,000 8% preference shares and %2 per share on 20,000 equity shares was not received The Company’s reserves and surplus was as General Reserve (beginning) stood at %30,00,000, Profit & Loss Account (beginning) at Profit made during the year was %60,00,000. Interim Dividend paid Transfer made to General Reserve was 220,00,000. Profit & Loss (year-end) stood at Prepare the Note on Share Capital and Reserve and Surplus forming part of the Balance Sheet of the Company. (10) Paper Subject Code: 23101 Financial Accounting and Auditing Financial Accounting 3B. Z Ltd. has opening balance of in its Machinery Account (WDV) Accumulated depreciation at the beginning was %12,00,000. There was an addition of Machinery of at the beginning of the year, while Machinery costing was sold at the end of the year. Accumulated depreciation on Machinery sold at the end of the Prepare a note on Fixed Assets forming part of the balance sheet of the company if the depreciation is charged for the year @ 15% on original cost. (5) 4, Mr. Shivom gives you his following details of investment for the year in 12 % Debentures of each in BH Ltd Interest is payable half yearly on September and March every year. The Books of accounts are closed on March every year Prepare 12% Debenture Account in the books of Mr. Shivom for the year ended on 31 4, Mr. Jinen had 10,000 equity shares of AP Ltd. on 1* April, 2017. The face value of the share is each but book value on 1* April, 2017 was per share On 1* May, 2017 he purchased another 2,000 equity AP Ltd., at having market price of each On 1* June, 2017, he purchased additional 3,000 equity shares of the same company at a market price of higher than face value On 1* July, 2017 he sold 3,000 equity shares at per share On October, 2017 the directors of AP Ltd. had declared and issued bonus shares at the rate of one share for every four shares held as on that date On December, 2017 he purchased 2,000 equity shares of AP Ltd. when market price was On 1* January, 2018, he purchased 3000 right shares in AP Ltd at per share On 1* February, 2018 he sold 2,500 equity shares for 25 per share Market Price of shares on March, 2018 was per share Prepare Equity Shares A/c in Mr. Jinen’s books for the year ended 31% March, 2018 (15) Paper Subject Code: 23101 Financial Accounting and Auditing VII Financial Accounting
26. Q5 The Following is the Balance Sheet of Aarman Ltd. as on 31% March 2018 10% Preference Shares of Goodwill 2,00,000 Equity shares of each 10,00,000 | Investments 5,00,000 The scheme of Reconstruction as approved by the court was as under:
27. Q1 Each existing equity share will be written down from 210 to %6 fully paid up
28. Q2 Each 10% Preference Share is to be written down from 210 to 8 fully paid up. These Preference shares are to be converted into 12% Preference Shares of %2 each and remaining into Equity shares of % 6 fully paid up
29. Q3 10% Debenture holders agree to waive 20% of their claims
30. Q4 Assets are revalued as follows: Stock reduced by 20%
31. Q5 Creditors are settled as follows:
    • a. 30% immediate payment
    • c. 50% paid by issue of 11% debentures
32. Q6 All fictitious and Intangible assets are to be written off
33. Q7 10,000 Equity Shares of %6 each were issued to public for cash, which were fully You are required: Prepare Capital Reduction A/c and show the extract of Asset forming part of balance sheet along with notes to accounts of Aarman Ltd after reconstruction. (15)
34. Q5 The Following is the Balance Sheet of Godfrey Ltd.as on 31 March 2018 5000, 6% Preference Shares of Goodwill 80,000 each fully paid up 5,00,000 | Patents and Trade Marks 20,000 40,000 Equity shares of 10 each Building 2,15,000 5% Debentures of 7100 each 2,00,000 | Stock 90,000 Accrued Interest on Debentures 30,000 | Debtors 75,000 Creditors 1,55,000 | Cash at Bank 12,500 Cash in hand 2,500 Note: The Preference Dividend is in arrears for 3 years It was decided to reconstruct the Company for which the following scheme was approved by Paper Subject Code: 23101 Financial Accounting and Auditing VII Financial Accounting
35. Q1 The assets are to be revalued as follows:
36. Q2 Intangible and fictitious assets are to be written of completely
37. Q3 The Preference Shares shall be converted into 7% Preference Share of each, number of shares being the same
38. Q4 The Equity Shares shall be reduced to each
39. Q5 The 5% Debentures shall be converted into equal number of 6% Debentures of each
40. Q6 The Debenture holders also agreed to waive 50% of the accrued interest
41. Q7 Arrears of Preference Dividend to be cancelled
42. Q8 The Creditors agreed to waive 30% of their claims and to accept Equity Shares for in part settlement of their renewed claims Draft journal entries (without narration) and give an extract of Balance Sheet to show 6A. What do you mean by Ethics? Describe its features and scope. (10)
    • B. Give disclosure of “Non-Current Investments” of a company as per Schedule 10
43. Q6 Write Short Notes on the following (Any 4) 20 marks
44. Q2 Disclosure of Share Capital in Company Balance Sheet
45. Q3 Methods of Internal Reconstruction
46. Q4 Benefits of Buy Back
47. Q5 Accounting Standard 13 marks
48. Q6 Contingent Liabilities Paper Subject Code: 23101 Financial Accounting and Auditing VII Financial Accounting
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