Ts grewal practical problems of Financial Statements Of A Company (2023-2024)

 Financial statement of Company Ts grewal solution volume-3(2023-2024):part-1

Question 1:

What are the major heads in the Equity and Liabilities part of the Balance Sheet as per Schedule III?  

 

Answer:

 

The major heads in the Equities and Liabilities part of the Balance sheet are:

i. Shareholder’s Funds,

ii. Share Application Money Pending Allotment,

iii. Non- Current Liabilities and

iv. Current Liabilities

Balance Sheet as at_______
Particulars	Note No.	( `)
I. Equity and Liabilities
1. Shareholders’ Funds
a. Share Capital
b. Reserves and Surplus
c. Money Received against Share Warrants
2. Share Application Money Pending Allotment
3. Non-Current Liabilities
a. Long-term Borrowings
b. Deferred Tax Liabilities (Net)
c. Other Long-term Liabilities
d. Long Term Provisions
4. Current Liabilities
a. Short-term Borrowings
b. Trade Payables
c. Other Current Liabilities
d. Short-term Provisions
Total

 

Question 2:

Under which major head will the following be shown:

(i) Share Capital; and (ii) Money Received Against Share Warrants?

 

Answer:

 

Items	Major Head
Share Capital	Shareholder’s Funds
Money received against share warrants	Shareholder’s Funds

 

Question 3:

List any five items that are shown under Reserves and Surplus.

 

Answer:

 

Items shown under Reserves and Surplus are:

i. Capital Reserve,

ii. Capital Redemption Reserve,

iii. Securities Premium Reserve,

iv. Debenture Redemption Reserve,

v. Revaluation Reserve etc.

 

Question 4:

Under which sub-head will the following be classified or shown:
(i) Long-term Borrowings; (ii) Deferred Tax Liabilities (Net); and (iii) Long-term Provision?

 

Answer:

 

Items	Sub-head
Long-term Borrowings	Non-Current Liabilities
Deferred Tax Liabilities (Net)	Non-Current Liabilities
Long-Term Provisions	Non-Current Liabilities

 

 

 

 

Question 5:

Name the items that are shown under Long-term Borrowings.

 

Answer:

 

Items shown under Long-term Borrowings are:

a. Debentures,

b. Bonds,

c. Terms Loans (both from Banks and from others),

d. Public Deposits,

e. Other Loans and Advances.

 

Question 6:

State giving reason whether Trade Receivables are classified as Current Assets or Non-current Assets in the Balance Sheet of a Company as per Schedule III of the Companies Act, 2013 in the following cases.   

Case	Operating Cycle Period (Months)		Expected Realisation Period (Months)
1	10		11
2	10		12
3	10		13
4	14		13
5	15		16

Answer:

 

Case	As Current Assets or Non- Current Assets	Reason
1.	Current Assets	Expected receipt is more than operating cycle but receivable within 12 months.
2.	Current Assets	Expected receipt is more than operating cycle but receivable within 12 months.
3.	Non- Current Assets	Expected receipt is more than operating cycle and receivable after 12 months.
4.	Current Assets	Expected receipt is less than operating cycle.
5.	Non- Current Assets	Expected receipt is more than operating cycle and receivable after 12 months.

 

Question 7:

State giving reason whether Trade Payables are classified as Current Liabilities or Non-current Liabilities in the Calance Sheet of a Company as per Schedule III of the Companies Act, 2013 in the following cases:

Case	Operating Cycle Period (Months)		Expected Payment Period (Months
1	10		11
2	10		12
3	10		13
4	14		13
5	15		16

 

Answer:

Case	As Current Liabilities or Non- Current Liabilities	Reason
1.	Current Liabilities	Expected payment is more than operating cycle but payable within 12 months
2.	Current Liabilities	Expected payment is more than operating cycle but payable within 12 months
3.	Non- Current Liabilities	Expected payment is more than operating cycle and payable after 12 months
4.	Current Liabilities	Expected payment is less than operating cycle
5.	Non- Current Liabilities	Expected payment is more than operating cycle and payable after 12 months

 

Question 8:

Under which head and how are the following items shown in the Balance Sheet of a company under Schedule III:
(i) Calls-in-Arrears;  (ii)  Share Application Money Pending Allotment; (iii) Unpaid Dividend; and (iv) Dividend not paid on Cumulative Preference Shares?

 

 

 

Answer:

 

Items	Head	Disclosure
Calls-in-Arrears	Shareholder’s Funds	It is shown as a deduction from Subscribed Capital shown as ‘Subscribed but not fully paid’ under Shareholder’s Funds
Share Application Money Pending Allotment	Share Application Money Pending Allotment	It is shown as a separate line item
Unpaid Dividend	Current Liabilities	It is shown as ‘Other Current Liability’ under Current Liabilities
Dividend not paid on Cumulative Preference Shares	Contingent Liabilities and Commitments	It is shown as Contingent Liabilities and Commitments in Notes to Accounts

Question 9:

Under which main head and sub-head of Equity and Liabilities part of the Balance Sheet are the following items classified or shown:
 

(i)   Bonds;	(ii)   Debentures
(iii) Public Deposits;	(iv)   Capital Redemption Reserve;
(v)  Forfeited Shares Account:	(vi) Sundry Creditors; and
(vii) Interest Accrued but Not Due on Debentures?

 

Answer:

 

Items	Main head	Sub-head
Bonds	Non-Current Liabilities	Long Term Borrowings
Debentures	Non-Current Liabilities	Long Term Borrowings
Deposits	Non-Current Liabilities	Long Term Borrowings
Capital redemption Reserve	Shareholder’s Funds	Reserves and Surplus
Share Forfeiture Account	Shareholder’s Funds	Subscribed Capital under Share Capital
Sundry Creditors	Current Liabilities	Trade Payables
Interest Accrued but not due on Debentures	Current Liabilities	Other Current Liabilities

 

Question 10:

State any two items that are included in the following major heads under which liabilities of a company are shown: (i) Reserves and Surplus; (ii) Long-term Borrowings;  (iii)  Short-term Borrowings; (iv) Other Current Liabilities.

 

Answer:

 

Major head	Items
Reserves and Surplus	Capital Reserve, Revaluation Reserve
Long-term Borrowings	Debentures, Term Loans from Bank and Others
Short-term Borrowings	Cash credit from bank, Loans repayable on demand
Other Current Liabilities	Income received in advance, Unpaid Dividends

Question 11:

Classify the following items under major head and sub-head (if any) in the Balance Sheet of a company as per Schedule III of the Companies Act, 2013: (i) Capital Work-in-Progress: (ii) Provision for Warranties; (iii) Income received in Advance; and (iv) Capital Advances

 

Answer:

 

Item	Major Head	Sub-Head
Capital Work-in-Progress	Non-Current Assets	Fixed Assets- Capital Work-in-Progress
Provision for Warranties	Non-Current Liabilities	Long Term Provisions
Income Received in Advance	Current Liabilities	Other Current Liabilities
Capital Advances	Non-Current Assets	Long Term Loans & Advances

 

Question 12. Under which major heads and sub-heads will the following items be placed in the Balance Sheet of the company as per Schedule 11, Part I of the Companies Act, 2013?

(i) Debentures with maturity period in current financial year

(ii) Securities Premium Reserve

(ii) Provident Fund

(CBSE Sample Paper 2022)

Answer:

S. No.	Item	Major Head	Sub-head
(i)	Debentures with maturity period in current financial year	Current Liabilities	Other Current Liabilities
(ii)	Securities Premium Reserve	Shareholders' Funds	Reserves and Surplus
(iii)	Provident Fund	Non-current Liabilities	Long-term Provisions

 

 

Question 13:

Under which major head and sub-head of the Assets part of the Balance Sheet will the following be shown:

(i) Intangible Assets; (ii) Intangible Assets under Development; (iii) Investments (more than 12 months); (iv) Deferred Tax Assets (Net); (v) Stores and Spares; and (vi) Loose Tools?

 

Answer:

 

Items	Main head	Sub-head
Intangible Assets	Non-Current Assets	Fixed Assets
Intangible Assets under development	Non-Current Assets	Fixed Assets
Investments (more than 12 months)	Non-Current Assets	Non-Current Investments
Deferred Tax Assets (Net)	Non-Current Assets	Deferred Tax Assets (Net)
Stores and Spares	Current Assets	Inventories
Loose Tools	Current Assets	Inventories

 

 

Question 14:

Under which heads the following items on the Assets part of the Balance Sheet of a company will be presented?
    

(i) Sundry Debtors;	(ii) Patents and Trademarks;	(iii) Shares in Quoted Companies:
(iv) Advances recoverable in cash;	(v) Prepaid Insurance; and	(vi) Work-in-Progress (Machinery)?

 

Answer:

 

Items	Main head	Sub-head
Sundry Debtors	Current Assets	Trade Receivables
Patents and Trade Marks	Non-Current Assets	Fixed Assets (Intangible Assets)
Shares in Quoted Companies	Non-Current Assets	Non-Current Investments
Advance Recoverable in Cash	Current Assets	Short-term Loans and Advances
Prepaid Insurance	Current Assets	Other Current Assets
Work-in-Progress (Machinery)	Non-Current Assets	Fixed Assets (Capital Work-in-progress)

 

Question 15:

Under which of the major heads will the following items be shown while preparing Balance Sheet of a company, as per Schedule III of the Companies Act, 2013:

(i) Unamortised Loss on Issue of Debentures (To be written off after 12 months from the date of Balance Sheet);
(ii) 10% Debentures;	(iii) Stock-in-Trade;	(iv) Cash at Bank;
(v) Bills Receivable;	(vi) Goodwill;	(vii) Loose Tools;
(viii) Truck;	(ix) Provision for Tax; and	(x) Sundry Creditors?

 

Answer:

 

ITEMS	HEAD	SUB-HEAD
Unamortised Loss on Issue of Debentures (To be written off after 12 months from date of Balance sheet)	Non-Current Assets	Other Non-Current Assets
10% Debentures	Non-Current Liabilities	Long-term Borrowings
Stock-in-Trade	Current Assets	Inventories
Cash at Bank	Current Assets	Cash and Cash equivalents
Bills Receivable	Current Assets	Trade Receivables
Goodwill	Non-Current Assets	Fixed Assets (Intangible Assets)
Loose Tools	Current Assets	Inventories
Truck	Non-Current Assets	Fixed Assets (Tangible Assets)
Provision for Tax	Current Liabilities	Short term Provisions
Sundry Creditors	Current Liabilities	Trade Payables

 

Question 16:

Under which heads will the following items be shown in the Balance Sheet of a Company

(i) Bank Balance;	(ii) Investments (Long-term);	(iii) Outstanding Salary;
(iv) Subscribed and paid-up Capital;	(v) Bills Payable;
(vi) Unclaimed Dividents;	(vii) Shares Option Outstanding Account;
(viii) General Reserve; and	(ix)  Subsidy Reserve?

 

Answer:

 

S. No.	Items	Main Head	Sub-Head
1	Bank Balance	Current Assets	Cash and Cash Equivalents
2	Investments (Long-term)	Non-Current Assets	Non-Current Investments
3	Outstanding Salary	Current Liabilities	Other Current Liabilities
4	Subscribed and paid-up Capital	Shareholder's Fund	Share Capital
5	Bills Payable	Current Liabilities	Trade Payables
6	Unclaimed Dividends	Current Liabilities	Other Current Liabilities
7	Share Option Outstanding Account	Shareholders’ Funds	Reserves and Surplus
8	General Reserve	Shareholders’ Funds	Reserves and Surplus
9	Subsidy Reserve	Shareholders’ Funds	Reserves and Surplus

 

 

 

Question 17: Under which major heads and sub-heads will the following items be presented in the Balance Sheet of the company as per Schedule Il, Part I of the Companies Act, 2013?

(i) Bank Overdraft

(ii) Subsidy Reserve

(iii) Capital Redemption Reserve

(iv) Mining Rights

(v) Patents

(vi) Debit balance in the Statement of Profit and Loss

(vii) Debenture Redemption Reserve

(vii) Provision for Taxation

(CBSE 2022)

 

Answer:

S. No.	Item	Major Head	Sub-head
(i)	Bank Overdraft	Current Liabilities	Short-term Borrowings
(ii)	Subsidy Reserve	Shareholders' Funds	Reserves and Surplus
(iii)	Capital Redemption Reserve	Shareholders' Funds	Reserves and Surplus
(iv)	Mining Rights	Non-current Assets	Property, Plant and Equipment (Fixed Assets)-Intangibles Assets
(v)	Patents	Non-current Assets	Property, Plant and Equipment (Fixed Assets)-Intangibles Assets
(vi)	Debit Balance in the Statement of Profit and Loss	Shareholders' Funds	Reserves and Surplus (as negative amount)
(vii)	Debenture Redemption Reserve	Shareholders' Funds	Reserves and Surplus
(vii)	Provision for Taxation	Current Liabilities	Short-term Provisions

 

 

Question 18:

Under which heads the following are shown in a company's Balance Sheet:

(i) Public Deposits;	(ii) Office Furniture;
(iii) Prepaid Rent;	(iv) Outstanding Salaries;
(v) Computer Software;	(vi) Interest Accrued on Investment?

Answer:

S. No.	Items	Main Head	Sub-Head
1	Public Deposits	Non-Current Liabilities	Long-term Borrowings
2	Office Furniture	Non-Current Assets	Fixed Assets (Tangible Assets)
3	Prepaid Rent	Current Assets	Other Current Assets
4	Outstanding Salaries	Current Liabilities	Other Current Liabilities
5	Computer Software	Non-Current Assets	Fixed Assets (Intangible Assets)
6	Interest Accrued on Investment	Current Assets	Other Current Assets

 

Question 19:

Under which major headings and sub-headings the following items will be shown in the Balance Sheet of a company as per schedule III of Companies Act, 2013?
(i) Provision for Employee Benefits.
(ii) Calls-in-Advance.

 

Answer:

 

S.No.	Item	Major Head	Sub-head
i)	Provision for Employee Benefit	Non-current Liabilities	Long term Provisions
ii)	Calls-in-Advance	Current Liabilities	Other Current Liabilities

 

Question 20: Under which sub-headings will the following items be placed in the Balance Sheet of a company as per Schedule II, Part I of the Companies Act, 2013?

(i) Prepaid Expenses

(ii) Loose Tools

(iii) Loans Repayable on Demand

(iv) Provision for Employees Benefit

(v) Negative Balance in the Statement of Profit and Loss

(vi) Bank Overdraft

(vii) Bills Receivables

(viii) Trade Marks

(Delhi 2022)

 

Answer:

S. No.	Item	Sub-head
(i)	Prepaid Expenses	Other Current Assets
(i)	Loose Tools	Inventories
(ii)	Loans repayable on Demand	Short-term Borrowings
(iv)	Provision for Employees Benefit	Long-term Provisions
(v)	Negative balance in Statement of Profit and Loss	Reserves and Surplus (as negative amount)
(vi)	Bank Overdraft	Short-term Borrowings
(vi)	Bills Receivables	Trade Receivables
(vii)	Trade Marks	Property, Plant and Equipment (Fixed Assets)Intangible Assets

 

Question 21:

How are the following items shown while preparing Balance Sheet of a company:
(i) Surplus, i.e., Balance in Statement of Profit and Loss (Dr.);
(ii) Interest accrued and due on Debentures;
(iii) Computer Software under development;
(iv) Interest accrued on Investment?

 

Answer:

 

ITEMS	MAJOR HEAD	SUB-HEAD
Surplus, i.e. Balance in Statement of Profit and Loss (Dr.)	Shareholder’s Funds	Reserves and Surplus (as negative figure)
Interest accrued and due on debentures	Current Liabilities	Other Current Liabilities
Computer Software under development	Non-current Assets	Fixed Assets (Intangible Assets under development)
Interest accrued on Investments	Current Assets	Other Current Assets

 

Question 22: Under which heads and sub-heads will be the following items shown in the Balance Sheet of a Company as per Schedule l, Part I of the Companies Act, 2013?

(i) Securities Premium Reserve

(ii) Interest accrued and due on secured loans

(iii) Cash and Bank balance

(iv) Interest accrued but not due

(v) Building

(vi) Mining Rights

(vii) Sundry Debtors

(vii) Sundry Creditors

(ix) Premium on Redemption of Debentures

(x) Provision for Tax

 

Answer:

S. No.	Major Head	Sub-head
(i)	Shareholders' Funds	Reserves and Surplus
(ii)	Current Liabilities	Other Current Liabilities
(ii)	Current Assets	Cash and Cash Equivalents
(iv)	Current Liabilities	Other Current Liabilities
(v)	Non-current Assets	Property, Plant and Equipment (Fixed Assets)-Tangible Assets
(vi)	Non-current	Assets Property, Plant and Equipment (Fixed Assets)-Intangible Assets
(vii)	Current Assets	Trade Receivables
(vii)	Current Liabilities	Trade Payables
(ix)	Non-current Liabilities	Other Long-term Liabilities
(x)	Current Liabilities	Short-term Provisions

 

 

 

 

Question 23:

Prepare Balance Sheet of the Company as per Schedule III of the Companies Act, 2013:	`
10% Debentures of  ` 100 each	1,90,000
Stock-in-Trade (inventories)	40,000
Goodwill	20,000
Provision for Tax	60,000
Totalling of Balance Sheet is not required

 

Answer:

Balance Sheet as at …
Particulars	Note No.	Amount ( `)
I. Equity and Liabilities
1. Shareholders’ Funds		–
2. Non-Current Liabilities
Long-term Borrowings	1	1,90,000
3. Current Liabilities
Short-term Provisions	2	6,000
Total
II Assets
1. Non-Current Assets
Intangible (Fixed Assets)	3	20,000
2. Current Assets
a. Inventories	4	40,000
Total

 

NOTES TO ACCOUNTS
Note No.	Particulars	Amount ( `)
1	Long-term Borrowings
	10% Debentures	1,90,000
2	Short-term Provisions
	Provision for Tax	6,000
3	Intangible (Fixed Assets)
	Goodwill	20,000
4	Inventories
	Stock-in-Trade	40,000

 

Question 24:

Prepare Balance Sheet of VT Ltd. as at 31st March 2022, from the following information as per Schedule III, Part I of the Companies Act, 2013:
 

	`			`
General Reserve	3,000		Fixed Assets: Tangible Assets (Cost)	9,000
8% Debentures	3,000		Other Current Liabilities	2,500
Surplus, i.e., Balance in Statement of Profit and Loss (Credit)	1,200		Share Capital	5,000
Depreciation of Fixed Assets	700		Other Current Assets	6,400

Answer:

Balance Sheet as at March 31, 2022
Particulars	Note No.	( `)
I Equity and Liabilities
1. Shareholders’ Funds
a. Share Capital	1	5,000
b. Reserves and Surplus	2	4,200
2. Non-Current Liabilities
Long-term Borrowings	3	3,000
3. Current Liabilities
Other Current Liabilities		2,500
Total		14,700
II Assets
1. Non-Current Assets
Fixed Assets (Tangible Assets)	4	8,300
2. Current Assets
Other Current Assets		6,400
Total		14,700

 

NOTES TO ACCOUNTS
Note No.	Particulars		( `)
1	Share Capital
	Share Capital		5,000
2	Reserves and Surplus
	General Reserve		3,000
	Balance in Statement of Profit and Loss (Credit)		1,200
			4,200
3	Long-term Borrowings
	8% Debentures		3,000
4	Fixed Assets
	Tangible Assets (Cost)	9,000
	Depreciation	(700)	8,300

 

Question 25:

From the following information extracted from the books of Howrach Ltd., prepare Balance Sheet of the company as at 31st March, 2022 as per Schedule III of the Companies Act, 2013:

	( ` in '000)		( ` in '000)
Long-term Borrowings	1,000	Fixed Assets (Tangible)	1,600
Trade Payable	60	Inventories	40
Share Capital	800	Trade Receivables	160
Reserves and Surplus	180	Cash and Cash Equivalents	240

Answer:

Balance Sheet of Howrach Ltd. as at March 31, 2022
Particulars	Note No.	( ` in ‘000)
I. Equity and Liabilities
1. Shareholders’ Funds
a. Share Capital		800
b. Reserves and Surplus		180
2. Non-Current Liabilities
Long-term Borrowings		1,000
3. Current Liabilities
Trade Payables		60
Total		2,040
II. Assets
1. Non-Current Assets
Fixed Assets (Tangible Assets)		1,600
2. Current Assets
Inventories		40
Trade Receivables		160
Cash and Cash Equivalents		240
Total		2,040

Question 26:

Prepare Balance Sheet of HP Ltd. as at 31st March, 2022 from the following information:

	`			`
Equity Share Capital	20,00,000		Surplus, i.e., Balance in Statement of Profit and Loss (Cr.)	3,00,000
12% Preference Share Capital	10,00,000		Stock	6,00,000
Fixed Assets (At cost)	46,60,000		Sundry Debtors	8,00,000
Accumulated Depreciation	16,60,000		Cash	1,50,000
Investments	4,00,000		Loans and Advances	50,000
Current Liabilities	8,00,000		Provision for Taxation	2,00,000
12% Debentures	6,00,000		Workmen Compensation Reserve	1,00,000

 

Answer:

Balance Sheet of HP Ltd. as at March 31, 2022
Particulars			Note No.	( `)
I. Equity and Liabilities
1. Shareholders’ Funds
a. Share Capital			1	30,00,000
b. Reserves and Surplus			2	4,00,000
2. Non-Current Liabilities
a. Long-term Borrowings			3	6,00,000
3. Current Liabilities
a. Other Current Liabilities			4	8,00,000
b. Short-term Provisions			5	2,00,000
Total				50,00,000
II Assets
1. Non-Current Assets
a. Fixed Assets
i) Tangible Assets			6	30,00,000
b. Non-Current Investments			7	4,00,000
2. Current Assets
a. Inventories			8	6,00,000
b. Trade Receivables			9	8,00,000
c. Cash and Cash Equivalents			10	1,50,000
d. Short-term Loans and Advances			11	50,000
Total				50,00,000
NOTES TO ACCOUNTS
Note No.	Particulars			Amount ( `)
1	Share Capital
	Equity Share Capital			20,00,000
	12% Preference Share Capital			10,00,000
				30,00,000
2	Reserves and Surplus
	Workmen Compensation Reserve			1,00,000
	Balance in Statement of Profit and Loss (Credit)			3,00,000
				4,00,000
3	Long-term Borrowings
	12% Debentures			6,00,000
4	Other Current Liabilities
	Current Liabilities			8,00,000
5	Short-term Provisions
	Provision for Taxation			2,00,000
6	Tangible Assets
	Fixed Assets (Cost)	46,60,000
	Depreciation	(16,60,000)		30,00,000
7	Non-Current Investments
	Investments			4,00,000
8	Inventories
	Stock			6,00,000
9	Trade Receivables
	Sundry Debtors			8,00,000
10	Cash and Cash Equivalents
	Cash			1,50,000
11	Short-term Loans and Advances
	Loans and Advances			50,000

 

Question 27:

Under which head following revenue items of a non-financial company will be classified or shown:
(i) Sales; (ii) Revenue from Services Rendered; (iii) Sale of Scrap; (iv) Interest Earned on Loans; and (v) Gain (profit) on Sale of Investments?

 

Answer:

 

ITEMS	HEAD
Sales	Revenue from Operations
Revenue from services rendered	Revenue from Operations
Sale of scrap	Revenue from Operations
Interest earned or Loans	Other Income
Profit on Sale of Investment	Other Income

 

 

 

Question 28:

Calculate Cost of Materials Consumed from the following:
Opening Inventory of Materials  `5,00,000; Purchase of Materials  `25,00,000; and Closing Inventory of Materials   `4,00,000.

 

Answer:

 

Cost of material consumed	=	Opening Inventory of Materials + Purchase of Materials
		-          Closing Inventory of Materials
	=	5,00,000+25,00,000-400,000
	=	26,00,000
Cost of material consumed	=	26,00,000

 

Question 29:

Calculate Cost of Materials Consumed from the following:
Opening Inventory of Materials  `3,50,000; Finished Goods  `75,000; Stock-in-Trade  `2,00,000; Closing Inventory of: Materials  `3,25,000; Finished Goods  `85,000; Stock-in-Trade  `1,50,000; Purchases during the year: Raw Material  `17,50,000; Stock-in-Trade  `9,00,000.

Answer:

Cost of material consumed	=	Opening Inventory of Materials + Purchase of Materials
		-          Closing Inventory of Materials
	=	3,50,000+17,50,000-3,25,000
	=	17,75,000
Cost of material consumed	=	17,75,000

 

Note: Opening Inventory of Finished Goods and Closing Inventory of Finished Goods will not be considered as these are shown under Change in Inventory of Finished Goods. Also, Opening, Closing and Purchases of Stock-in-Trade are not considered as they are not part of cost of materials consumed.

 

Question 30:

From the following information of Hospitality Ltd. for the year ended 31st March, 2018, calculate amount that will be shown in the Note to Accounts on Changes in inventiories of Finished Goods, WIP  and stock-in-Trade:

Particulars	Opening Inventory ( `)			Closing inventory( `)
Finished Goods	5,00,000			5,50,000
Work-in-Progress	4,50,000			4,25,000
Stock-in-Trade	6,50,000			6,00,000

Answer:

NOTES TO ACCOUNTS

 

 

Note No.	Particulars		( `)
	Change in Inventories of Finished Goods, WIP and Stock-in-Trade
(a)	Finished Goods
	Opening Inventory	5,00,000
	Less: Closing Inventory	5,50,000	(50,000)
			(50,000)
(b)	Work-in-Progress
	Opening Inventory	4,50,000
	Less: Closing Inventory	4,25,000	25,000
			25,000
(c)	Stock-in-Trade
	Opening Inventory	6,50,000
	Less: Closing Inventory	6,00,000	50,000
			50,000
	Net Change (a+b+c)		25,000

` 25,000 will be shown in the Statement of Profit and Loss against the Change in Inventories of Finished Goods, Work-in-Progress and Stock-in-Trade.

 

Question 31:

From the following information of Best Marketing Ltd. for the year ended 31st March, 2022 prepare Note to Accounts on Depreciation and Amortisation Expenses:
Depreciation on: Building  ` 15,500; Plant and Machinery  ` 25,000; Computers  ` 60,000; Goodwill written off  ` 7,500; Patents written off  ` 12,500.

 

Answer:

 

NOTES TO ACCOUNTS

 

Note No.	Particulars		Amount ( `)
	Depreciation and Amortisation Expenses
	Depreciation
	Building	15,500
	Plant and Machinery	25,000
	Computers	60,000	1,00,500
	Amortisation
	Goodwill written off	7,500
	Patents written off	12,500	20,000
			1,20,500
	Amount to be shown in the Statement of Profit and Loss		1,20,500

 

 

Question 32:

From the following information compute the amount to be shown in Note to Accounts on Employees Benefit Expenses: Wages  ` 5,40,000; Salaries  ` 7,20,000; bonus  ` 1,05,000; Staff Welfare Expenses  ` 60,000 and Business Promotion Expenses  ` 50,000.

 

Answer:

 

 NOTES TO ACCOUNTS

Note No.	Particulars		Amount ( `)
	Employees Benefit Expenses
	Wages	5,40,000
	Salaries	7,20,000
	Bonus	1,05,000
	Staff Welfare Expenses	60,000	14,25,000
	Amount to be shown in the Statement of Profit and Loss		14,25,000

*Amount spent on promotion of business is not included in Employees Benefit Expenses.

 

 

Question 33:

From the following information, prepare Note to Accounts on Employees Benefit Expenses:
Wages  ` 2,70,000; Salaries  ` 3,60,000; Staff Welfare Expenses 60,000; Printing and Stationery Expenses  ` 20,000 and Business Promotion Expenses  ` 50,000.

 

Answer:

 

NOTES TO ACCOUNTS

Note No.	Particulars		Amount ( `)
	Employees Benefit Expenses
	Wages	2,70,000
	Salaries	3,60,000
	Staff Welfare Expenses	60,000	6,90,000
	Amount to be shown in the Statement of Profit and Loss		6,90,000

*Amount spent on promotion of business and printing & Stationary expenses are not included in Employees Benefit Expenses.