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    OCTOBER 2019: Reg. No.

    Uploaded by

    Selvi Selvi
    This document contains a sample exam for a corporate accounting course. It includes: 1) 20 short answer questions covering topics like types of shares, debentures, dividends, and reconstructions. 2) 5 medium questions requiring calculations and journal entries on issues like share capital, debentures, and takeovers. 3) 3 long questions involving the preparation of final accounts, multiple journal entries, and absorption of one company by another through a share exchange. The document provides context and details for sample exam questions.

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    Download as PDF, TXT or read online from Scribd

    OCTOBER 2019: Reg. No.

    Uploaded by

    Selvi Selvi
    44 views6 pages
    This document contains a sample exam for a corporate accounting course. It includes: 1) 20 short answer questions covering topics like types of shares, debentures, dividends, and reconstructions. 2) 5 medium questions requiring calculations and journal entries on issues like share capital, debentures, and takeovers. 3) 3 long questions involving the preparation of final accounts, multiple journal entries, and absorption of one company by another through a share exchange. The document provides context and details for sample exam questions.

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    Original Title

    U 611-1

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    This document contains a sample exam for a corporate accounting course. It includes: 1) 20 short answer questions covering topics like types of shares, debentures, dividends, and reconstructions. 2) 5 medium questions requiring calculations and journal entries on issues like share capital, debentures, and takeovers. 3) 3 long questions involving the preparation of final accounts, multiple journal entries, and absorption of one company by another through a share exchange. The document provides context and details for sample exam questions.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    44 views6 pages

    OCTOBER 2019: Reg. No.

    Uploaded by

    Selvi Selvi
    This document contains a sample exam for a corporate accounting course. It includes: 1) 20 short answer questions covering topics like types of shares, debentures, dividends, and reconstructions. 2) 5 medium questions requiring calculations and journal entries on issues like share capital, debentures, and takeovers. 3) 3 long questions involving the preparation of final accounts, multiple journal entries, and absorption of one company by another through a share exchange. The document provides context and details for sample exam questions.

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    of 6

    WK 14

    Reg. No. :

    OCTOBER 2019 U/611/09–18/05309

    CORPORATE ACCOUNTING –I

    Time : Three hours Maximum : 100 marks

    SECTION A — (10 × 2 = 20 marks)

    Answer any TEN questions.

    1. What is a share?

    2. What is underwriting?

    3. Write a note on ‘profit prior to incorporation.

    4. Define goodwill.

    5. What is meant by capital reserve?

    6. What is a debenture?

    7. When can shares be forfeited?

    8. What is average profit?

    9. Explain interim dividend.

    10. State the meaning of Re-issue.

    11. What is purchase consideration?

    12. What is external reconstruction?


    WK14

    SECTION B — (5 × 7 = 35 marks)

    Answer any FIVE questions.

    13. What are the various kinds of share capital?

    14. ABC Ltd. Was registered with a nominal capital of 20,00,000


    consisting of 10,000 equity shares of 200 each. It invited
    application for 8000 equity shares payable as 50 application
    and 100 on allotment. Application were received only for 6000
    shares, all of them were accepted. Allotment money was received
    without any arrears. Pass entries.

    15. B Ltd. issued 500, 6%. Debentures of 50 each. Give journal


    entries if the debentures are

    (a) Issued at par

    (b) Issued at a discount of 10%

    (c) Issued at a premium of 10%

    16. X Ltd ., followed the following reconstruction scheme, which was


    duly approved.

    (a) The 9% preference shares be reduced 8% preference shares


    at 60 each. The original value of preference shares was
    100. There are 1,000 preference shares.

    (b) Equity shares of 100 each to be reduce to 80 each.


    There are 2000 equity shares.

    Find the amount transferred to capital reduction.

    2 U/611/09–18/05309
    WK14

    17. From the following particulars determine the maximum


    remuneration available to a full time director of a manufacturing
    company. The profit and loss a/c showed at a net profit of
    80,00,000 after taking into account the following items:

    Particulars

    Depreciation (including special depreciation of Rs. 8,000 2,00,000

    Provision for Income Tax 4,00,000

    Donation to political parties 1,00,000

    Ex–gratia payment to a worker 2,00,000

    Capital profits on sale of assets 30,000

    18. PQR Ltd. Issued 25,000 shares of 100 each. The whole issue
    was underwritten by David. In addition there is a firm
    underwriting of 3000 shares by David. Applications for 17,000
    shares were received by the company in all. Calculate the
    liability of David.

    19. S Ltd. Was take over by R Ltd. The following position was
    mutually agreed upon:

    S Ltd. R Ltd.

    No. of Shares 60,000 90,000

    Face Value of Share 100 10

    Net Assets 3,60,000 72,00,000

    Ascertain Intrinsic values of the shares, ratio of exchange of


    shares and No. shares to be issued

    3 U/611/09–18/05309
    WK14

    SECTION C — (3 × 15 = 45 marks)
    Answer any THREE questions.
    20. The balances arrived X Ltd., on 31.03.2018 as follows:

    Opening Stock 7,500 Sales 35,000


    Purchases 24,500 Wages 5,000
    Discount (Dr.) 700 Discount (Cr.) 500
    Salary 750 Rent 495
    General Expenses 1,705 P and L a/c (Cr.) (31.03.2012) 1,503
    Interim dividend paid 400
    Dividend Paid 500 Debtors 3,750
    Share Capital Machinery 2,900
    ( 1 each) 10,000

    Creditors 1,750 Reserve 1,550


    Cash 1,620 Bad debts 158
    Loan to director 325
    Adjustments:
    (a) Closing Stock 8,200
    (b) Depreciation on machinery @ 10%
    (c) Reserve for discount on debtors @ 5%
    (d) Provision for Discount on creditors @ 2 ½%
    Prepare company final a/c as on 31.03.2018.
    21. Ram Ltd. Issued 50,000 shares of 10 each payable as under.
    3 on application
    4 on allotment and
    The balance on call.
    Application for 70,000 shares had been received.
    Application for 8,000 shares were rejected and the remaining
    applicant’s were allotted the 50,000 shares on pro-rata basis.
    The excess amount on application was adjusted towards the
    amount due on allotment. All the shareholders paid the amount
    due. Give journal entries.
    4 U/611/09–18/05309
    WK14

    22. On 31.12.2008, the balance sheet, of a company was


    Liabilities Assets
    Share Capital Fixed Assets 5,00,000
    (shares at Rs.10 each) 4,00,000 Current assets 2,00,000
    Reserves 90,000 Goodwill 40,000
    P & L a/c 20,000
    10% debentures 1,00,000
    Current Liabilities 1,30,000
    7,40,000 7,40,000
    On 31.12.2008 the fixed assets were independent valued at
    3,50,000 and the goodwill at 50,000. The net profit for the
    three years were : 2006 – 51,600 ; 2007 – 52,000 ;
    2008 – 51,650 at which 20% was placed to reserve, this
    proportion being considered measurable to the industry in which
    the company is engaged and where for investment return may be
    taken at 10%.
    Calculate the value of company’s share by
    (a) Net assets method and
    (b) Yield method
    23. Gokul Ltd., was registered on 1.7.2017 and acquire the running
    business of X and Co. with effect from 1.1.2017. The following
    was the profit and loss account of the company on 31.12.2017.

    To Office Expenses 54,000 By Gross profit 2,25,000


    To Formation Expenses 10,000
    (written off)
    To Stationery and Postage 5,000
    To Selling Expenses 60,000
    To Director’s fees 20,000
    To Net profit 76,000
    2,25,000 2,25,000
    You are required to prepare a statement showing profit earning
    by the company in the pre and post incorporation periods. The
    total sales for the year book place in the ratio of 1 : 2 before and
    after incorporation respectively.
    5 U/611/09–18/05309
    WK14

    24. Ramesh Ltd. Is to absorb Subha Ltd. The purchase consideration


    is the issue of 5 shares of 10 each at 10% Premium for every 4
    shares held in Subha Ltd. The balance sheets on the date of
    absorption were as under:

    Liabilities Ramesh Subha Assets Ramesh Subha


    Ltd. Ltd.
    Ltd. Ltd.

    Share 20,00,000 12,00,000 Fixed assets 16,00,000 8,00,000


    capital
    (Rs.10
    each)

    Reserves 2,00,000 1,60,000 Investments: –


    24,000 Shares
    in Subha Ltd. 3,20,000

    Creditors 4,00,000 2,40,000 20,000 Shares


    in Ramesh –
    Ltd. 2,40,000

    Current
    assets 6,80,000 5,60,000

    26,00,000 16,00,000 26,00,000 16,00,000

    Prepare ledger accounts in the books of Subha Ltd and journal


    entries in the books of Ramesh Ltd along with balance sheet
    after the absorption.

    ————————

    6 U/611/09–18/05309

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