Corporate Accounting
Question Paper 2023
Gauhati University BCOM 2nd
SEM
COMMERCE (Honours Core)
Paper: COM-HC-2016
Full Marks: 80
Time: 3 hours
1. (i) Fill in the blanks with appropriate
words: 1x5=5
(a) Right shares are
generally issued at a price _______ than the market price.
(b) The Companies Act,
2013 follows _______ format for preparation of Final Account.
(c) The issue of bonus
shares must be recommended by Board of Directors and approved by the _______.
(d) Pre-acquisition
profits are _______ profits.
(e) The company into which
another company is amalgamated is called _______ Company.
(ii) State whether the
following statements are true or false: 1x5=5
(a) Reduction in share
capital must be sanctioned by National Company Law Board.
(b) At the time of
valuation of goodwill, only gross profit is considered.
(c) Computer software is a
‘non-current’ asset.
(d) AS-24 deals with
‘accounting for amalgamation’ of companies.
(e) Buy back of shares
does not affect the authorised share capital of company.
2. Answer the following questions: 2x5=10
(a) Write the meaning of
issue of bonus shares.
(b) State two objectives of
amalgamation of companies.
(c) What is internal
reconstruction?
(d) What do you mean by
‘holding company’?
(e) Mention the names of
various methods of valuation of equity shares.
3. Answer any four of the following: 5x4=20
(a) Mention five conditions
to be followed for buy back of shares.
Or
Sunrise Ltd. has issued and
paid up capital of Rs. 8,00,000 divided into equity shares of Rs. 10 each. The
balance in the securities premium account was Rs. 1,40,000 and general reserve
Rs. 80,000. The company decided to buy back 20% of its share capital from its
shareholders at Rs. 8 per share.
Pass Journal entries in
the books of Sunrise Ltd. to record the above transactions.
(b) Explain the following:
(i) Deferred tax
liability.
(ii) Corporate dividend
tax.
(c) Show journal entries in
the books of transferee company when amalgamation is in the nature of purchase.
(d) Explain briefly the
need for preparation of consolidated Balance Sheet.
(e) The following
information is taken from Visual Co. Ltd.:
(i) Capital:
900 6% preference shares
of Rs. 100 each fully paid.
9000 equity shares of Rs.
10 each fully paid.
(ii) External liabilities
Rs. 15,000.
(iii) Other equity Rs.
3,000.
(iv) The average profit
(after taxation) earned every year is Rs. 10,500.
Calculate the value of
each equity share.
(f) Arohan Ltd. decided on
30-03-2023 to convert its 80,000 fully paid equity shares of Rs. 10 each into
Rs. 7 per share fully paid up and to return Rs. 3 per share to equity
shareholders.
Pass necessary Journal
entries in the books of Arohan Ltd.
4. Answer the following questions: (any four) 10x4=40
(a) What is goodwill?
Explain the various methods of valuation of goodwill. 2+8=10
(b) Write four conditions
for effecting capital reduction. Explain the complete procedure to be followed
for capital reduction. 4+6=10
(c) The following ledger
balances are extracted from the books of Divine Ltd. on 31-03-2023:
|
Particulars |
Amount
(Rs.) |
|
20,000 equity shares of
Rs. 100 each Sundry Creditors Bank Loan Proposed Dividend 10% Debentures General Reserve Securities Premium
Reserve Surplus in Statement of
Profit & Loss on 31-03-2023 Livestock Land & Building Cash in Hand Cash at Bank Stock in Trade Furniture Plant & Machinery Sundry Debtors Prepaid Expenses Long Term Investments |
20,00,000 7,20,000 4,00,000 1,00,000 8,00,000 2,80,000 1,00,000 4,00,000 3,00,000 10,80,000 1,00,000 2,00,000 4,20,000 6,00,000 10,00,000 8,80,000 20,000 2,00,000 |
You are required to prepare
a Balance Sheet of the company as per schedule III of the Companies Act, 2013.
(d) Sailash Ltd. and
Kailash Ltd. decided to amalgamate and a new company SK Ltd. is formed to take
over both the companies as on 31st March, 2023. The following are
the Balance Sheets as on that date:
Balance Sheet
|
Particulars |
Amount
|
|
|
|
Sailash
Ltd. |
Kailash
Ltd. |
|
I. Equity and
Liabilities: 1.
Shareholder’s Fund (a)
Share Capital Equity
shares of Rs. 10 each fully paid (b)
Reserve and Surplus Reserve
Fund Dividend
Equalisation Fund Workman
Compensation Fund Surplus
in the Statement of Profit & Loss 2.
Non-current Liabilities 10%
Debenture 3.
Current Liabilities: Trade
Payables: Sundry
Creditors Bills
Payable |
10,00,000
4,00,000 - 40,000 60,000
-
2,00,000 1,00,000 |
6,00,000
3,00,000 2,00,000 - 1,00,000
1,00,000
2,40,000 60,000 |
|
Total
|
18,00,000 |
16,00,000 |
|
II. Assets 1.
Non-current Assets (a)
Property and Equipment (b)
Goodwill (c)
Other Intangible Assets Patent
& Trade mark 2.
Current Assets (a)
Inventory (b)
Trade Receivables: Debtors
Bills
Receivable (c)
Cash & Cash Equivalents |
9,00,000 2,00,000
-
4,00,000
2,00,000 - 1,00,000 |
8,90,000 1,60,000
1,05,000
3,00,000
1,00,000 40,000 5,000 |
|
Total
|
18,00,000 |
16,00,000 |
Calculate the purchase
consideration of both the companies and prepare the amalgamated Balance Sheet
of SK Ltd. assuming the amalgamation is in the nature of purchase.
(e) The following are the
Balance Sheets of “Himesh Ltd.” and its subsidiary Co. “Shekhar Ltd.” as on 31st
March, 2023:
Balance
Sheet
|
Particulars |
Amount
|
|
|
|
Sailash
Ltd. |
Kailash
Ltd. |
|
I. Equity and
Liabilities 1.
Shareholder’s Fund (a)
Share Capital Equity
shares of Rs. 10 each (b)
Reserve and Surplus Surplus
in the Statement of Profit & Loss 2.
Current Liabilities Trade
Payables: Sundry
Creditors |
1,20,000
10,000
34,000 |
40,000
8,000
12,000 |
|
Total
|
1,64,000 |
60,000 |
|
II. Assets 1.
Non-current Assets Plant,
Property and Equipment 2. Non-current
Investment 3200
shares in Shekhar Ltd. |
1,36,000
28,000 |
60,000
- |
|
Total |
1,64,000 |
60,000 |
The shares were acquired by
Himesh Ltd. on 1st October, 2022. Prepare the consolidated Balance
Sheet of Himesh Ltd. and Shekhar Ltd. as on 31-03-2023 and show necessary
workings.
(f) Coal India Ltd.
resolved to utilize Rs. 2,50,000 of its General Reserve Balance to declare a
bonus to shareholders by paying the final call of Rs. 2.50 per share on
1,00,000 equity shares of Rs. 10 each. The company further decided to utilize
the balance of Securities Premium Reserve A/c of Rs. 2,00,000 by issuing fully
paid up bonus shares.
Pass Journal entries in the
books of company and also show the ratio of bonus issue.
(g) What is right share?
Explain the advantages of right issue. 4+6=10
(h) Write notes on: 5+5=10
(i) Amalgamation in the
nature of merger.
(ii) Different forms of internal reconstruction.
***
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