|Total No. of Questions — 6]||[Total No. of Printed Pages — 5|
|Time Allowed : 3 Hours||Maximum Marks : 100|
|Answers to questions are to be given only in English except in the cases of candidates who have opted for Hindi medium. If a candidate who has not opted for Hindi medium, answers in Hindi, his answers in Hindi will not be valued.|
|Answer all Questions.|
|Working notes should form part of the answer.|
|1.|| The draft Balance Sheets of 3 Companies as at 31st March, 2007 are as below: |
Following additional information is also available:
Prepare consolidated Balance Sheet as on 31st March, 2007. Workings should be part of the answer.
|2.|| The Balance Sheets of Strong Ltd. and Weak Ltd. as on 31.03.2007 is as below: |
Strong Ltd. takes over Weak Ltd. on 01.07.07. No Balance Sheet of Weak Ltd. is available as on that date. It is however estimated that Weak Ltd. earns estimated profit of Rs.2,00,000 after charging proportionate depreciation @ 10% p.a. on fixed assets, during April–June, 2007.
Estimated profit of Strong Ltd. during these 3 months is Rs.4,00,000 after charging proportionate depreciation @ 10% p.a. on fixed assets.
Both the companies have declared and paid 10% dividend within this 3 months' period. Goodwill of Weak Ltd. is valued at Rs.2,00,000 and Fixed Assets are valued at Rs.1,00,000 above the estimated book value. Purchase consideration is to be satisfied by Strong Ltd. by shares at par. Ignore Income–tax.
|3.||(a)||Shivaji Ltd. purchased Fixed assets worth Rs.90,00,000 on 1st April, 2002. The life of the assets is 10 years and they are to be depreciated on straight line basis. The assets were revalued on 1st April, 2004 when 50% of the assets was assessed at 10% less than the book value, and the remaining assets were revalued at 15% higher than book value. The assets were ultimately sold on 1.4.2006 for Rs.54,80,000. Excess depreciation on revaluation, if any, should be charged to Revaluation Reserve. |
Show Fixed Assets A/c, Depreciation A/c and Revaluation Reserve A/c, supported by Workings wherever necessary.
|(b)|| The Balance Sheet of Domestic Ltd. as on 31st March, 2007 is as under: |
The resale value of Premises and Land is Rs.1,200 lacs and that of Plant and Machinery is Rs.2,400 lacs. Depreciation @ 20% is applicable to Motor Vehicles. Applicable depreciation on Premises and Land is 2%, and that on Plant and Machinery is 10%. Market value of the Investments is Rs.1,500 lacs. 10% of book debts is bad. In a similar company the market value of equity shares of the same denomination is Rs.25 per share and in such company dividend is consistently paid during last 5 years @ 20%. Contrary to this, Domestic Ltd. is having a marked upward or downward trend in the case of dividend payment.
The unusual negative profitability of the company during 2002–03 was due to the lock out in the major manufacturing unit of the company which happened in the beginning of the second quarter of the year 2001–02 and continued till the last quarter of 2002–03.
Value the Goodwill of the Company on the basis of 4 years' purchase of the Super Profit. (Necessary assumption for adjustment of the Company's inconsistency in regard to the dividend payment, may be made by the examinee).
|4.||(a)|| Indian Engineering and Technological Institute, an autonomous body furnishes the following information: |
On 1.4.2006, unutilised restricted government grant (capital) balance is Rs.40,00,000; unutilised unrestricted government grant (revenue) balance is Rs.9,00,000; Institute's own corpus fund is Rs.25,00,000. Besides, a private endowment fund of Rs.18,50,000 is there on that date. The entire endowment fund is in fixed deposit with a bank fetching interest of 9.5% p.a. half–yearly transferred on 30th September and 31st March to a current account meant for scholarship and awards. The said current account has a debit balance of Rs.1,37,500. Apart from this, total cash and bank balance as on 1.4.06 is Rs.85,00,000.
|(b)|| Value Added Ltd. furnishes the following Profit and Loss A/c: |
Prepare value added statement for the year ended 31st March, 2007 and reconcile total value added with profit before taxation.
|5.||(a)|| Arrange and redraft the following Cash Flow Statement in proper order keeping in mind the requirements of AS 3: |
|(b)||P Ltd. has 60% voting right in Q Ltd. Q Ltd. has 20% voting right in R Ltd. Also, P Ltd. directly enjoys voting right of 14% in R Ltd. R Ltd. is a listed company and regularly supplies goods to P Ltd. The management of R Ltd. has not disclosed its relationship with P Ltd. |
How would you assess the situation from the viewpoint of AS 18 on Related Party Disclosures?
|(c)||Lessee Ltd. took a machine on lease from Lessor Ltd., the fair value being Rs.7,00,000. The economic life of the machine as well as the lease term is 3 years. At the end of each year Lessee Ltd. pays Rs.3,00,000. Guaranteed Residual Value (GRV) is Rs.22,000 on expiry of the lease. Implicit Rate of Return (IRR) is 15% p.a. and present value factors at 15% are 0.869, 0.756 and 0.657 at the end of first, second and third years respectively. |
Calculate the value of machine to be considered by Lessee Ltd. and the interest (Finance charges) in each year.
|6.||Write short notes on the following:||6+5+5=16|
|(a)||The concept of Materiality.||(0)|
|(b)||Maintenance of Books of Account by Stock Brokers.||(0)|
|(c)||Human Resources Accounting.||(0)|