lowest = 1037500- max dividend -

-
↑
-

ESC = 8000000 x 10 = 800000

·

↑3 =
1750 000x9%
.
=

-
151500
4.34 ACCOUNTING 957588
/ Resenes
NP -
-

Illustration 5 2300000
I
-- -
-
-
a
7508
>

The following is the Trial Balance of Omega Limited as on 31.3.20X2:

(Figures in` ‘000)

I DU Debit CV .
Credit

⑧ Land at cost 220 Equity Capital (Shares of ` 10 300 Je

↑
PDE Se

each)
Plant & Machinery at cost 770 10% Debentures 200 NLL : LTB 6-
PPE
2 ° CA Trade Receivables 96 General Reserve 130 R23 10 ·

CA Inventories (31.3.X2) 86 Profit & Loss A/c 72 R25

E Bank 20 Securities Premium 40 R25
POSIT Adjusted Purchases 320 Sales 700 RFO 80

BOE Factory Expenses 60 Trade Payables 52 CL 96

OE Administration Expenses 30 Provision for Depreciation ⑧

172 PPE : /eSS
OF Selling Expenses 30 Suspense Account
40
--
⑧
4
qe
-

↳"FL
~
-
Debenture Interest 20
Interim Dividend Paid ? 18
ries
-

(e) 1670 1670

Additional Information:
(i)
- The authorised share capital of the company is 40,000 shares of ` 10 each. SC

(ii)
w The company on the advice of independent valuer wish to revalue the land at
` 3,60,000. -
Land
ROU
- 3113 . Res G 022
nd
.

- ⑧
(iii) Declared final dividend @ 10% on 2 April, 20X2.
- - - - -
NO
- -
effect
- - -
- - - -

(iv)
- Suspense account of ` 4,000 represents cash received for the sale of some of Dr.
=>
-
-
-
- - -
Suspense - -

the machinery on 1.4.20X1. The cost of the machinery was ` 10,000 and the->
- - -

-
10000 Cash + 4000
- - -

accumulated depreciation thereon being ` 8,000. Mack

- - -

w -

-
-
-
AP
a ↑
-
8000 -+
P&L 2000
(v)
- Depreciation is to be provided on plant and machinery at 10% on cost. -
D2 A : 76000
A D 76000
- - -
- - - - :
- .

I
You are required to prepare Omega Limited’s Balance Sheet as on 31.3.20X2 and
Statement of Profit and Loss with notes to accounts for the year ended 31.3.20X2 as
per Schedule III. Ignore previous years’ figures & taxation.
AD 8000
suspense Dr 4000 u ·
C 10008 e

I
=

4000 -
=

4000 Cash Dr

I
Cash Dr.
.
,
.
-
AD Dr 2000 -
-
AB DO 8000 WDV 2000
To Suspense 4000
.
.

To P2L
- 2000 -P 4000
To Pl 2000 ,
- --
© The Institute of Chartered Accountants of India
,

To P2M
,
10000 Y P2M 10000 WP 2000
=

-
, , -
 4.38 ACCOUNTING

Illustration 6
You are required to prepare Balance sheet and statement of Profit and Loss from the
following trial balance of Haria Chemicals Ltd. for the year ended 31st March, 20X1.
Haria Chemicals Ltd.
Trial Balance as at 31st March, 20X1
OS
Particulars ` Particulars `
↑
C & Inventory =>

↳31 6,80,000 Equity Shares SUF SL :

- -

Furniture PPE 2,00,000 Capital (Shares of ` 10 each) 25,00,000

Discount-allowed OI 40,000 11% Debentures NCL : LTB 5,00,000
Loan to Directors 2A . 80,000 Bank loans NCL : LTB -
6,45,000
Advertisement OE 20,000 Trade payables CL 2,81,000
Bad debts - 35,000 Sales RFO 42,68,000

/
received Commission paid OE 1,20,000 Rent received Of 46,000

O
X
CONC Materials consumed RN
-
- -
⑧ 23,19,000
-
-
Transfer fees Of 10,000
-
Plant and Machinery PPI 8,60,000 Profit & Loss account SH: ReS 1,39,000
Rentals OE 25,000 Depreciation provision:
Current account CA : COCE 45,000 Machinery PPE : deduct 1,46,000
-
-

Cash CA :
C &CE 8,000
Interest on bank loans FC
-
1,16,000
- -

Preliminary expenses OE 10,000

Fixtures PPE 3,00,000
Wages EBE 9,00,000
Consumables OE 84,000
Freehold land PPE 15,46,000
Tools & Equipment PPE 2,45,000
Goodwill 1A 2,65,000
Trade receivables CA -
4,40,000
-

Dealer aids OE 21,000

Transit insurance OE 30,000
Trade expenses OE 37,000

© The Institute of Chartered Accountants of India

 FINANCIAL STATEMENTS OF COMPANIES 4.39

Distribution freight OE 54,000

Debenture interest FC 55,000
85,35,000 85,35,000

Additional information: Closing Inventory on 31-3-20X1: ` 8,23,000. Stoc Dr . -> CA

---

To
Trading -
narr
Solution .

⑰Ea
Haria Chemicals Ltd.
Balance Sheet as at 31st March, 20X1
Schedule Rupees as at the
No. end of 31st March 20X1
(1) (2)
Equity and Liabilities
(1) Shareholders’ funds :
(a) Share Capital 1 25,00,000
(b) Reserves and Surplus 2 7,40,000
(2) Non Current Liabilities
(a) Long term borrowings 3 11,45,000
(3) Current Liabilities
(a) Trade payables 2,81,000
Total 46,66,000
Assets
(1) Non current assets
(a) PPE 4 30,05,000
(b) Intangible assets (goodwill) 2,65,000
(2) Current assets
(a) Inventories 8,23,000
(b) Trade receivables 4,40,000
(c) Cash and bank balances 5 53,000
(d) Short term loans and advances 6 80,000
Total 46,66,000

© The Institute of Chartered Accountants of India

Illustration 6: -

Statement of Profit & Loss f .

t .

y .
e .
31 3 21
. .

particulars Notes 31 3 21 . .
31 3 20
. .

1 .

Revenue from operations u 4268000

-

.
2 Other Incomes 2 50000
-

Total Income ~
4 000
,
-

enses
-

1 ·
Lost of Material consumed -
2319000
-

2 .
Purchase OF SIT -

3 .

Changes in
inventory of FG/WIP/SIT I C143000)
..

.
↳
Employee Benefit Expenses :

wages 900 000

1
,

5 .
Finance cost 5 17000
·

& Amortisation
6 ·

Depreciation
476000
7 .
Other Expenses 3
-
·

Total Expenses -000

-

Profit for the

year -
-
601000
-
 Balance Sheet as on 31 3 21
: .

Particulars Notes 31 3 21
.
.
31 3 20
: .

Equity viability
&

shareholders funds
share capital 6 2580000
,

Reserves & surplus 9 740000

-

Non - Current
Liability
Borrowing 1145000
T
Long term

current
Liability
Trade
Payables 201000
-

4666000
-
-

oent Assets

Plant &
Property
3005000
.
Equipment 2 -

Assets Goodwin 265008

Intangible :
.

Non -
Current Investments

other Non-twent Assets :

Loans to Dive -
80000
&

Current Assets
Trade Receivables 440000
-

stock
closing 823000
I

↳
Cash Cash
Equivalents -
53000
/

00
NOTES TO ACCOUNTS

Cash & Cash

I changes
in
inventory
of WIP/EG/I 4 .

Equivalents

Account
opening inventory
1 680000 Current 45000
-

using Inventory
2 .
& 23000 cast 0000
·

- - -

143000
-
-
-000

Plant &
2 .

Property I Equipment
Net Amount
Particulass Gross Amount Acc .
Depu

1 .
Furniture 200000 O 200000
·
-

2 .
Plant & Mach 860000 -
146000 O
714 000
ro
I ,
I

3 Fixtures 300000 0 3 000 30

.

↑
-
% -
↳ Freehold land 1546000
-
⑧ 1546 000
5 .
Tools & Equipments 245000 O 245000
. -

5- Finance lit
3 .
Other Expenses
1 .
Discount 40000 Interest on bank loan 116008
↑
/ ~

2 . Advertisement 20000
S
debenture Interest 53008
↑

↳ Baddelts
.
3500
-

↳ .
Commission 190000
- wo
5 .
Rentals 25000
-

Capital
Preliminary
share
6 .

Expenses 10000
-
6e

7. consumables 84000
S
Authorised Share Capital
Dealer aids
8
Equity
21000 Shaves
25 000
.

,
-

9 Transit Insurance 3000 of E10 each 200

.

&

10 .
Trade Expenses 37000 Issued subscribed & Paid up
,
-

Distribution shares of El0 each

11 .

Freight 54000
I
350000
·

Equity 2508000
-
-
-

41Uw8
-
-
7.

Long term
Borrowings 8 other incomes

% Debenture 500000 Rent received 46000

-

Bank war :45000 Transfer Fees 10000

/
-

-
- -

1145000 56000
~

-
- - -
-

9: Reserves & surplus

P& L al 139 000 ,

profit fit y 601000

.

/
/

40000
I
 10 Reserves & Surplus
NOTE :

opening bal
surplus :
.
41500
I

add : CY

General Reserve 200000

,

Capital Reserve 5000

/

NOTE 11
Losing Stock
:

22508

wineslig a
i

ic400
-

200
-
 4.42 ACCOUNTING

9. Employee benefit expense

Wages 9,00,000
10. Finance cost
Interest on bank loans 1,16,000
Debenture interest 55,000
1,71,000
11. Other Expenses
Consumables 84,000
Preliminary expenses 10,000
Bad debts 35,000
Discount 40,000
Rentals 25,000
Commission 1,20,000
Advertisement 20,000
Dealers’ aids 21,000
Transit insurance 30,000
Trade expenses 37,000
Distribution freight 54,000
4,76,000
Illustration 7 acks
You are required to prepare a Statement of Profit and Loss and Balance Sheet from
the following Trial Balance extracted from the books of the International Hotels Ltd.,
-

on 31st March, 20X2:

Dr. Cr.
` `
Sc - Authorised Capital-divided into 5,000 6% Preference Shares
of ` 100 each and 10,000 equity Shares of ` 100 each 15,00,000
Sc - Subscribed Capital -
- 5,000 6% Preference Shares of ` 100 each 5,00,000
-

2 Equity Capital 8,05,000

=

© The Institute of Chartered Accountants of India

 FINANCIAL STATEMENTS OF COMPANIES 4.43

↑ of SIT Purchases
-
- Wines, Cigarettes, Cigars, etc. 45,800
- =
-

POF RM - CONC- Foodstuffs

--
36,200
-

#BE Wages and Salaries 28,300

OE Rent, Rates and Taxes 8,900
-

OE Laundry 750
-

Sales - Wines, Cigarettes, Cigars, etc. 68,400

S
SIT
RFO =

- Food FG 57,600
OE Coal and Firewood 3,290
=>
I

Carriage and Cooliage

OF= 810
Sundry Expenses 5,840
OF Advertising 8,360
OE Repairs 4,250
-

RFO Rent of Rooms 48,000

-
-

RF8 Billiard 5,700

-
=

01 Miscellaneous Receipts
I
2,800
-

Ol Discount received 3,300

-

Transfer fees 700

↑ Freehold Land and Building
-

-
8,50,000
PPE Furniture and Fittings 86,300
-

Inventory on hand, 1st April, 20X1

= I

C11- SIT Wines, Cigarettes. Cigars, etc.

-
12,800
-

COMC+ RM Foodstuffs 5,260

CA : C& CE Cash in hand 2,200
CA :

LOCE Cash with Bankers 76,380

OE Preliminary and formation expenses 8,000
=

NCL
:

LTB 2,000 Debentures of ` 100 each (6%)

-
- C=) ->
Int Dr
. > FC 2,00,000
=

R2S Profit and Loss Account To Intols

.
-> CL 41,500
-

CL Trade payables 42,000

-

© The Institute of Chartered Accountants of India

 4.44 ACCOUNTING

CA Trade receivables 19,260

-

NCA : NC Investments 2,72,300

-

NCA :
1A Goodwill at cost 5,00,000
R2S General Reserve 2,00,000
19,75,000 19,75,000
Wages and Salaries Outstanding
- -
1,280 ->
DV - EBE
Inventory on 31st March, 20X2
- -

Wines, Cigarettes and Cigars, etc.

Foodstuffs
-
-
SIT

&MCOMC
CII 22,500
16,400
Gel
in a
->

site
COMC]
D&A
Depreciation : Furniture and Fittings @ 5% p.a. : Land and Building @ 2% p.a. -D Dr .
+

-
-
-
-
-
↳ ADCU . -> PPEless
720000 CrThe Equity capital on 1st April, 20X1 stood at ` 7,20,000, that is 6,000 shares fully
.

- = - - -

paid and 2,000 shares ` 60 paid. The directors made a call of ` 40 per share on 1st
-

+80000
October 20X1. A shareholder could not pay the call on 100 shares and his shares were
- -

200000 - -- -

10000 F then forfeited and reissued @ ` 90 per share as fully paid. The Directors declared a
-
-
~
-

- > >

dividend of 8% on equity shares on 2nd April, 20X2, transferring any amount that may
-
-
-~ -

790000
-
be required from General Reserve. Ignore Taxation.
+ 10000
Solution

-go
-

o Balance Sheet of International Hotels Ltd. as at 31st March, 20X2

Particulars Note `
No
Equity and Liabilities
1 Shareholders' funds
a Share capital 1 13,00,000
b Reserves and Surplus 2 2,68,745
2 Non-current liabilities
a Long-term borrowings 3 2,00,000
3 Current liabilities
a Trade Payables 4 42,000
b Other current liabilities 5 13,280
Total 18,24,025

© The Institute of Chartered Accountants of India

 CA INTERMEDIATE
Stat of P&L

I fro
P A
incomes
RFO
Ol

Total Income

Expenses
COMC

Purch of SIT 300

~

CII of WIP AG SIT

, ,
8 (9700)
EBE 3 29580
finance
charges E 17 12000

a
D& A in
2

OE

The
years
P N A

E &L

SHF
SC I 1300000
-

RRS 268745
-

NCL
-

LTB 10 200000
-

Ch
-

Interest outst on deb . 12000

42000
Trade
Day ,

1280
S

1824025
wages Ols
-

Sets
NCA

PDE 7 914985
-

/A : Goodwil 500000
-

NCI
:
Investments 272308
-

CA Tejas Suchak
 CA INTERMEDIATE

I#I
Current Assets

Trade Rec .
19260

Cash & (E . 78580

/

U Stock
.

13 38900 1824025
-I

NOTE 1 : -
SC NOTE 2 : COMC

Authorised SC OS OF RM 5260
1

5000 j%. ps of 100 each 500000

·
+P Of RM 36200

10000 ES of 100 each 1000000

-
-
CS Of RM (3
16400
-

1500000
- 260
Issued Subscribed &Paid up
.

5000PS of E100 each 500,000

-
ESC EBE 800000 N4 :
OF
#3
:

1300000
& Rent
wages Salary
28308 6900

wages Ols
-

-
1280
Laundry 758

29580 coal 3290

-
&
-

cau . 810

EXP 5840
I

Adut 8360
N5 :
RFO ·

Repairs 425
S

sale of SIT 18400 Pre .

Exp 8000
- -

sale of FG 57608 00
Rent of rooms 48000
7

Bivards 5700

- -

179700
-
1
-

NOTE 6 : 01 N8 :

Cl of WIP FG , SIT
,

miss .
rec .
2800 CS of WIP FG , .
SIT 22500
1

disveL 3300
,
less
:

Os of Wil FG SIT
, , (12800)
-

Nans fees -
700
0
6800
-

CA Tejas Suchak
 CA INTERMEDIATE
NOTE 7 : PPE
Particlass Gross Amt A
Depu Net Art -

land &
Building 850000
& I
17000
I
833000
furn &
fittings 80300 4315
/
-
-1985

N9 : CILE No :
5
in hand 61 Debentures
W

cash 2200 . 200000

1
L

cash at bank 76380

-
--

78580
- 2000
-
-

N II : Fl NI2 : R&S

Interest on Deben 12000 POL :

Op bal
.
41500
S

add : c y . ·

profit 22245
-
2
63745
I

12000 Gen Resery .

200000
-
- 1
1

Cap Res .

-
5000

268745
-
-

N 13 : (S N14 : DeA

wines F2F
ciggy's cigars
,
,
22500
16400
4315

foodstuff /
22B 17000
-
S

21315
- -
-1
- -

30400
>

en
NOTE 10

e ne
-
-

#10
-

DINOTEIO
=-

CA Tejas Suchak
 CA INTERMEDIATE
1 -
4 -
21 S-L- -
720000 IV .
5 -
c .
Dr . 100x100
-

Call 2000x40 = 80000 C8 . To S . F .

100X60
,

-00
(W . To CIA
,
100 X 40

- For ,
100x100 = 10000 Dr .

- -

790000 Bank Dr .
100 x 90

goode
+ Reissue 100x100 SF Dr 100 X 10
:
.
=
.
.

600000 To S C .
100 x 100
,

S.F Dr 100X50
↳ To Cap Res
,

S F - . 5000 .
.
100x50

3
.

=
To S .
C
:
5000 SC :
DU 5000
,

*
To..R 500p
To
SF .
5000
TO 1 R ,
.

.
5000

CA Tejas Suchak