Friday, July 12, 2019

B.Com 2nd Year Question Papers (Distance): Corporate Accounting' 2018


2018
(July)
COMMERCE
Paper: 202
(Corporate Accounting)
Full Marks: 90
Time: 3 hours
The figures in the margin indicate full marks for the questions
1. (a) State the following statements whether ‘True’ or ‘False’:           1x5=5
1)         A debenture holder is a creditor of the company.
2)         Dividends can be declared except out of profits.
3)         External reconstruction means reduction of share capital of a company which is to be reconstructed.
4)         General Insurance includes all types of insurance including Life Insurance.
5)         In a wholly owned subsidiary, there is no minority interest because all the shares with voting rights are held by the holding company.
(b) Fill in the blanks:                                                            1x5=5
1)         Profit on re-issue of forfeited shares is transferred to _______.
2)         A company can declare and distribute dividend even if it’s Memorandum and Articles are _______.
3)         Reduction of capital is unlawful except when sanctioned by the _______.
4)         Banks are _______ institutions.
5)         Post-acquisition profits are treated as _______ profits.
2. Write short notes on:                                             4x5=20
a)         Preliminary Expenses.
b)         Proposed Dividend.
c)          Purchase Consideration.
d)         Re-insurance.
e)         Cost of control.
3. (a) What do you mean by Buy-back of shares? State the conditions to be fulfilled for buy-back of shares. Briefly give guidelines in regulations made by SEBI relating to buy-back of shares. 2+5+5=12
Or
(b) On 1st April, 2014 X Co. Ltd. issued 1,000, 6% debentures of Rs. 100 each, repayable at par at the end of 4 years. It was decided to create a Sinking Fund for the repayment of the debentures and invest the amount of fund in 6% Government Securities.
Pass Journal entries in the books of X Co. Ltd. for 4 years assuming that the investments were realised for Rs. 70,000 only and the debentures were paid-off at the end of the period.
Annual instalment to provide Rs. 1 at the end of 4 years at 6% compound interest is Rs. 0.228591.
4. (a) Explain the following items:                                                             4x3=12
1)         Advance Payment of Tax.
2)         Managerial Remuneration.
3)         Provisions and Reserves.
Or
(b) XYZ Co. Ltd. was registered with an authorised capital of Rs. 10,00,000 divided into shares of Rs. 10 each of which 40,000 shares have been issued and fully paid up. The following is the Trial Balance extracted on 31st March, 2018:

Debit
(Rs.)
Credit
(Rs.)
Stock (01.04.17)
Returns
Manufacturing Expenses
10% Bank Loan (Secured)
Office Salaries and Expenses
Directors Remuneration
Land and Building
Furniture
Debtors and Creditors
Cash at Bank
Profit & Loss A/c (01.04.17)
Share Capital
Purchases and Sales
Manufacturing Wages
Carriage Inward
Interest on Bank Loan
Auditor’s Fees
Preliminary Expenses
Plant & Machinery
Loose Tools
Cash in hand
Advance Payment of Tax
1,86,420
12,680
19,240

17,870
26,250
1,64,210
5,000
1,05,400
96,860


7,18,210
1,09,740
4,910
4,500
8,600
6,000
1,28,400
12,500
19,530
84,290

9,850

50,000




62,220

38,640
4,00,000
11,69,900


17,30,610
17,30,610
You are required to prepare Profit & Loss Account for the year ended 31st March, 2018 and a Balance Sheet as on that date after taking into consideration the following adjustments:
1)         On 31st March, 2018, Stock was valued at Rs. 1,24,840.
2)         Provide for interest on Bank Loan for 6 months.
3)         Depreciation Plant & Machinery @ 15% p.a. and Office furniture @ 10% p.a.
4)         Write-off 1/3rd of Preliminary Expenses.
5)         Ignore Corporate Dividend Tax.                         7+5=12
5. (a) X Ltd. and Y Ltd. decide to amalgamate and a new Company named XY Ltd. is formed to take over both the Companies as on 31st March, 2018. The following are the ledger balances of the Companies as on that date:
Credit Balances
X Ltd.
(Rs.)
Y Ltd.
(Rs.)
Debit Balances
X Ltd.
(Rs.)
Y Ltd.
(Rs.)
Share Capital:
Shares of Rs. 10 each fully paid up
Reserve Fund
Profit & Loss A/c
Dividend Equilisation
Workmen Compensation Fund
Bank Overdraft
Sundry Creditors
Bills Payable 


5,00,000
2,00,000
30,000
-

20,000
-
90,000
50,000


3,00,000
1,50,000
50,000
1,00,000

-
50,000
1,10,000
30,000
Goodwill
Land & Building
Plant & Machinery
Patents & Trade Mark
Stocks
Sundry Debtors
Bills Receivable
Cash at Bank
1,00,000
2,50,000
2,00,000

2,00,000
90,000
-
50,000
80,000
1,90,000
2,53,000
57,500
1,50,000
40,000
20,000
2,500

8,90,000
7,90,000

8,90,000
7,90,000
Calculate the Purchase Consideration. Also pass Journal Entries and prepare the amalgamated Balance Sheet of XY Ltd. assuming that amalgamation is done in the nature of purchase.                                                 2+5+5=12
Or
(b) Explain the various provisions of alteration of Share Capital as per the Companies Act, 2013 with examples.              12
6. (a) Explain: (any three)                                             4x3=12
1)         Fire Insurance.
2)         Re-insurance.
3)         Double Insurance.
4)         General Insurance.
Or
(b) The following figures have been obtained from the books of Moon Light Bank Ltd. for the year ended 31st March, 2018:


Rs.
Interest and discount earned
Commission and exchange earned
Interest paid
Salaries and Wages
Director’s Fees
Rent and Taxes
Postage and Telephone Expenses
Profit on sale of investments
Rent received
Depreciation on Bank’s property
Stationary
Auditor’s Fees
38,00,000
1,95,000
20,00,000
2,10,000
35,000
70,000
61,000
2,40,000
62,000
31,000
60,000
8,000

Additional information:
1)         The Profit & Loss Account had a balance of Rs. 10,00,000 on 1st April, 2017.
2)         An advance of Rs. 12,00,000 has become doubtful and it is expected that only 50% of the amount due can be recovered from security.
3)         A dividend of 10% is proposed on subscribed capital of Rs. 10,00,000.
Prepare Profits & Loss A/c of Moon Light Bank Ltd. for the year ended 31st March, 2018.    12
7. (a) Give the legal definition of a holding company and its subsidiary company. Mention any four advantages and four disadvantages of a holding company.       4+4+4=12
Or
(b) A Ltd. (Holding Co.) acquired 4,000 shares of B Ltd. (Subsidiary Co.) as on 1st April, 2017. Their Ledger account balances as on 31st March, 2018 stood as follows:
Credit Balances
A Ltd.
(Rs.)
B Ltd.
(Rs.)
Debit Balances
A Ltd.
(Rs.)
B Ltd.
(Rs.)
Share Capital:
Shares of Rs. 10 each fully paid

Profit & Loss A/c
Creditors


1,00,000

40,000
40,000


50,000

10,000
20,000
Fixed Assets
Investment:
40,000 shares in B Ltd. at Rs. 12.50

Current Assets
1,00,000


50,000

30,000
60,000


-

20,000

1,80,000
80,000

1,80,000
80,000
On 1st April, 2017, the Profit & Loss A/c of B Ltd. showed a Loss of Rs. 15,000 which was written off out of profits earned in 2017-18.
Prepare a consolidated Balance Sheet as on 31st March, 2018.

***

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