12 The profit and loss account of S - Ltd. showed a balance of Rs. 53,300 on 1st April, 2000.

A dividend of 15 per cent was paid on 15th October, 2000 for the year 1999 - 2000. Corporate dividend tax at 11 % was also, paid on the dividend paid. The dividend was credited by H - Ltd. to its profit and loss account. H - Ltd. acquired the share on 1st October, 2000. The bills payable of S - Ltd. were all issued in favour of H - Ltd. which got the bills discounted. Included in the creditors of S - Ltd. is Rs. 20,000 for goods supplied by H- Ltd. The stock of S - Ltd. includes goods to the value of Rs. 8,000 which were supplied by H - Ltd. at a profit of 331/3 % of cost. Prepare consolidated balance sheet of H - Ltd. as on 31st March, 2001. 13. Explain the objectives of human resource accounting.

Register Number :

Name of the Candidate :

5 5 8 7

M.Com. (Accounting and Finance) DEGREE EXAMINATION, 2008

( SECOND YEAR )

( PAPER - IX )

640. ADVANCED CORPORATE ACCOUNTING December ]

[ Time : 3 Hours

Maximum : 100 Marks

SECTION - A

(5 8 = 40)

Answer any FIVE questions.

All questions carry equal marks.

1. P. Ltd. issued a prospectus inviting applications

for 1,00,000 equity shares of Rs. 10 each,

payable as to Rs. 250 with application, Rs. 350 on allotment and the balance on

first and final call. Applications were received

for 99,000 shares only. All the applications

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2
30,000 7 5 ,000 -..... 25 ,000 6 0,000 1,5 00 shares in 90,000 S -Ltd. at cost 40,000 5 0,000 Cash at bank Assets G oodwill S tock S - Ltd. Rs. 2,00,000 6 0,000 D ebtors -..... 8 0,000 Liabilities H - Ltd. Rs. Share capital : S hares of Rs. 100 each G eneral reserve as on 1-4-2000 Profit and loss account B ills payable Creditors 5 ,00,000 1,00,000 1,40,000 8 ,20,000 4,40,000 8 ,20,000 4,40,000 2,40,000 S - Ltd. Rs. 2,20,000 90,000 1,00,000 20,000 O ther fix ed assets 3,6 0,000

11

were accepted in full. The call was also, made in due course of time. All moneys were duly received. Journalise all the above including cash
H - Ltd. Rs. 40,000

mentioned

transactions

transaction.

2. What are the conditions which must be fulfilled for redemption of preference shares ? What is

the purpose of these legal restrictions ?

3. A Life Assurance Corporation gets its valuation made once in every two years. The life assurance fund on 31st March, 2003 amounted to Rs. 41,92,000 before providing for Rs. 32,000 for the shareholders dividend for the year 2002 - 03. Its actuarial valuation

on 31st March, 2003, disclosed net liability of Rs. 40,40,000 under the assurance and

annuity contracts. An interim bonus of Rs. 40,000 was paid to the policy - holders during the period ending 31st March, 2003.

12. F ollowing are the balance sheets of H - Ltd. and S - Ltd. as at March - 31, 2001 :

Prepare a statement showing the amount now available as bonus to policy - holders.

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10
P articulars B/f Stores in hand Cash in hand Cost of generation of electricity 30,000 9,000 12,000 21,000 10,000 20,000 20,000 12,34,500 12,34,500 Cost of distribution of electricity Rent rates and taxes Establishment expenses Interest on debentures Interim dividend Depreciation 4,000 6,000 Dr. Cr. Rs. Rs. 11,02,500 12,34,500

4. Write short notes on : (a)

Double Insurance.

(b) Minority Interest. (c)

Responsibility Accounting.

F rom the above given balances prepare capital account, revenue account, net revenue account and general balance sheet.

5. The Hindustan Gas Company rebuilt and re-equipped part of their works at a cost of Rs. 5,00,000. The part of the old works thus superceded cost Rs. 3,00,000. The capacity of the new works is double the capacity of the old works. Rs. 20,000 is realised by the sale of old materials, and old materials worth Rs. 10,000 are used in the construction of the new works and included in the total cost of Rs. 5,00,000 mentioned

above. The costs of labour and materials are

25% higher than when the old works were built.

Journalise the entries.

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4
-.... 6,000 2,04,000 3,10,000

9 11. The following balances ap p eared in the book s of U niv ersal E lectric Su p p ly C orp oration Ltd. as on 31st March, 2002 :
P articu lars E q u ity shares D ebentu res Su ndry creditors D ep reciation fu nd accou nt Sale of cu rrent Meter rent N et rev enu e accou nt balance on 31-3-2001 Land on 31-3-2001 Land p u rchased du ring the y ear Mains inclu ding cost of lay ing to 31-3-2001 Mains ex p anded du ring the y ear Machinery on 31-3-2001 Machinery p u rchased du ring the y ear Su ndry debtors for cu rrent su p p lied O ther book debts C /o 1,5 0,000 60,000 1,60,000 76,000 5 ,5 0,000 66,000 40,000 5 00 11,02,5 00 12,34,5 00
3,10,000

S - Ltd. R s.

1,00,000

-.....

3,00,000

H - Ltd. R s.

1,62,400

2,17,600

6,8 0,000

D r. R s.

C r. R s. 6,00,000 2,00,000 1,000 2,5 0,000 1,5 0,000 5 ,000 28 ,5 00

A ssets

F ix ed assets

31st March, 2007

5 0,000

S - Ltd. R s.

60 % shares in 2,00,000 S - Ltd. acq u ired on

5 ,00,000

1,00,000

8 0,000

60,000 C u rrent assets

P relim inary ex p enses 6,8 0,000

March, 2007.

Liabilities

H - Ltd. R s.

Share capital :

Shares of R s. 10 each fu lly p aid R eserv es C reditors

6. The following are the balance sheets of H - Ltd. and S - Ltd. as at 31st

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8 (a) The authorised capital of the company is Rs. 2,00,000. (b) Stock on 31 Rs. 35,000. (c) Depreciate plant and machinery at 9 per cent and revalue loose tools at Rs. 4,100. (d) Allow 2 per cent discount on debtors and 2 per cent as bad debts reserve. You are not required to show the previous years figures. 10. From the following particulars, prepare the Fire Revenue Account for 2002 - 2003 :
Rs. in lakhs Claims paid Legal expenses regarding claims Premiums received Reinsurance premiums Commission Expenses of management Provision against unexpired risk on April - 1, 2002 Claims unpaid on April - 1, 2002 Claims unpaid on March - 31, 2003 260 20 35 235 5 600 60 100 150

December,

2006

is

O n 31st March, 2007 , S - Ltd. revalued its fixed assets at Rs. 1,10,000. Prepare the consolidated balance sheet of H - Ltd. and its subsidiary S - Ltd. as at 31st March, 2007 .

7 . The U ltra O ptimist Ltd. went into liquidation. I ts assets realised Rs. 3,50,000 excluding the amount realised by sale of securities held by secured creditors. The following was the position :

Share capital : 50,000 shares of Rs. 10 each.

Rs...

Secured creditors (Securities realised Rs. 40,000)

35,000

Preferential creditors

6,000

U nsecured creditors

- 1,40,000

Debentures having a floating

charge on the assets of the

company

- 2,50,000

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6 7 Rs...
Opening stock Particulars Cr. Rs.

Liq uidation expenses 5,000

Rent and taxes Purchases 60,900 55,200 1,500 2,570 70,000 1,175 20,000 28,000 25,000 6,000 3,000 4,400 Bad debts Debenture interest (paid upto 30-6-2006) Miscellaneous expenses Insurance Cash and bank balances 3,000 3,22,400 3,000 1,000 625 1,030 Creditors Bank over-draf t Discount received T ransf er f ees Purchases returns Sales 5% debentures Wages Discount Fuel Building Carriage in Sundry debtors Goodwill Plant and machinery Loose tools Advertisement General expenses of Rs. 100 each

Dr. Particulars Rs. 30,000 E q uity share 6,000 capital 1,000 shares 1,00,000 25,000 1,75,000 8,000 12,000 2,200 100 100

Liq uidatori remuneration 7,500

Prepare the liq uidatori f inal statement of account.

8. E xplain opportunity cost method of evaluating human resource. (3 20 = 60)

S E C TI O N - B

Answer any THREE questions. All questions carry equal marks.

9. From the under mentioned trial balance f or X - Ltd, prepare a trading and prof it and loss

account f or the year ended 31st December, 2006 and the balance sheet as at that date.

3,22,400

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