- Dis eer arth -atel 2g hae war © Soyiry oo ow aatne SANSA Advanced Corporate ‘Accounting (Accountancy Major) The figures in the margin indicate full marks for the questions 4. Answer the following as per direction : 4x10=10 (@) What is the fair market value of a share? (b) What is bonus share? (©) State the meaning of winding up of a company. (@) What is meant by a subsidiary company? (@) What is meant by consolidated balance sheet? (Intrinsic value of a share is based on the value of (Fill in the blank). (g) Profit earned prior to incorporation can be distributed as dividend. (State ‘true’ or ‘false’). (h)__ The liquidation caused by inability to pay debt is referred to 2s. liquidation. (Fil in the blank) () A subsidiary company cannot by shares of the holding company after it has become its subsidiary. (State ‘true’ or alse’) (Which one of the following statements is not correct? () _ Post-acquisition profits are treatéd as capital profits * (ii) According to AS21, a company can become a part or holding company by controlling the board of directors of another company. (ii) Amount of interest or equity acquired minus cost of acquisition = capital reserve. a preferential creditors are those who have been given preference for >) payment under section §30(1) of the Companies Act.4138 ADVANCED CORPORATE ACCOUNTING Calculate the ratio of sales of pre and post-incorporation periods that the sales were effected evenly during the year. : S Ltd has the capital of Rs. 75,00,000 in shares of Rs. 100 each; ‘out a Ltd purchased 60% shares at Rs. 70,00,000. The profits of S Ltd at the time of purchase of shares by H Ltd were Rs. 40,00,000. Calculate the interest (equity) acquired in S Ltd by the H Ltd. (0) Amount realised by sale of securities Rs. 3,000 crores at the winding up of the company; the amount of principal and interest due to the secured creditors Rs. 2,000 crores; the company is solvent at winding up. Ascertain the amount payable to secured creditors; and ascertain where the balance amount would go, (@) Mention the different forms of holding companies. (@) State the meaning of reconstruction of companies. Answer as directed : (@) Following is the balance sheet of Nongphu Strawberry Ltd as on 31-3-2012 ‘Share Capital : 1000 6% Preference shares of Rs. 100 each . 40,000 equity shares of Rs.10 each. Reserves... 6% Debentures Sundry Creditors 1,00,000 | Sundry assets 4,00,000 2,00,000 50,000 1,00,000 8,50,000 =a 8,50,000 Compute the value of each included in Sundry assets, equity share assuming goodwill of Rs, 60,000 5G.U. QUESTION PAPER (SEMESTER SYSTEM) 4139 Pass joumal entries for sacrifice made value of shares is aloe by shareholders assuming that per reduced proportionately. or Explain the different forms of intemal reconstruction. 5 pee. bern Pe entire sete liquidation. Cash available before payment ae Unsecured creditors : Rs. 20,000 aa Share capital (shares of Rs.10 each) = Rs. 40,000 | go. Calculate remuneration of liquidator if he is entitled to a commission of 5% mm the amount distributed among unsecured creditors; and 2% on the amount distributed among shareholders. 5 (d) From the following balance sheets of H Ltd (Holding Co) and $ Ltd (Subsidiary Co) prepare a consolidated balance sheet of H Ltd and its subsidiary S 3 Liabilities HLtd SLtd | Assets HLtd Sltd | poi2 Rs. | Rs. Re. Pav —- ‘Shere Capital Bel ‘Sundry assets 4,00,000 | 2,25,000 | equiy shares of | Rs. 10 each | 5,00,000 | 2,00,000 | Investments : | 20,000 equity shares | 00 ‘Sundry liabilities 1,00,000 | 25,000 | of Rs. 10 each | of S Ltd. 2,00,000 = 6,00,000 | 2,25,000 6,00,000 | 2,25,000 or Describe the treatment of issue of bonus share by the subsidiary company, in consolidated balance sheet. 5 a ‘The following is the balance sheet of Dighalpar Marine Co Lid as on 31st March, 2012. 00 Liabilities Rs. | Assets Rs. — 7,900,000 equity shares Land 7,00,000 "ag of Rs.10 each 10,00,000 Pe & machinery 2,30,000 Fumiture 68,000 ‘Sundry Creditors 1,73,000 | Inventory 1,50,000 s Debtors 70,000 Cash at bank 5,000,"ADVANCED CORPORATE ACCOUNTING The approval of the Tribunal was obtained to undertake the following of reduction of capital. (i) The equity shares to be reduced to Rs. 4 per share; (i) Plant and machinery to be written down to Rs. 1,50,000, (iil) Inventory to be revalued at Rs. 1,40,000 (iv) The provision on debtors for doubtful debts to be created Rs. 2,000 (Land to be revalued at Rs. 1,42,000 (vi) The creditors foregone Rs. 73,000 from their claim; and the amount wil be retained in free reserves. Pass journal entries to give effect to the above arrangement and also Prepare Reconstruction Account. 10 Or What are the situations that call for internal reconstruction of a company? Discuss the provisions of the Companies Act with regard to reduction of capital, 10 (8) Silviculture Ltd was incorporated on 1st May 2012 to take over the business 9f Rose Lid from the preceding 1st January. The accounts were made upto 31st December 2012 in the normal course. The Trading and Profit and Loss account showed the following result : | Rs. | | Rs. To Opening Inventory 2,40,000 | By Sales 11,00,000} To Purchases | 8,10,000 By Closing Inventory 2,50,000 To Gross Profit c/d 13,50,000) 13,50,000] To Salaries 50,000 | By Gross Profit b/d 3,00,000 To Rent & taxes 19,000 To Directors fees 18,000 50,000 49,000 1,14,000 3,00,000 orfed that the sales for November and December are one and half ti for the year; while sales for February and March are only half the a me Profit and Loss account showing pre and post-incorporation profits, ra x fe MO, BirkG-U. QUESTION PAPER (SEMESTER SY§TEM) «am (©) Subha Clinics Ltd went es final Soh of ee liquidation on 31st January 2012, Prepare fens herchokors TW from the following information assuming that referentiz “ Goes not have preferential rights ae to pune aes ‘the payment of dividend but ’8. 2.000 Long term loan E 40,000 Trade creditors “24,000 amount yi 20,000 8% Preference Shares of Rs.10 each fully paid up 2,00,000 t and also 20,000 equity shares of Rs.10 each fully paid up 2,00,000 10 Preference dividend is in arrear for one. year, Assets realised Rs, 3,92,000 ” Discuss Liquidation expenses amounted to Rs, 5,00. Liquidator is entited to a 5 remuneration of 10% on the amount distributed to shareholders. 10 @ business Or December (a) Prepare the list of preferential creditors in respect of liquidation of a following company. (b) State the meaning of contributory and their responsibilty over Rs. liquidation of companies. 5+5=10 6,008 (0). Te alow, is te blanco shot of Hand ts, sbeiny $ Lid as pe f0.000 Usbilities | Hitd | Sita | Assets ] Huta | Suta == Re | Rs. Rs | Rs. 13,50,000] ce 7] Sonaly assets | 68,000) 26,000 | 3,00,000 ee | Investronts Rs. 10 each 60,000 | 20,000 | 1,600 shares Profit & Loss alc | 6,000 | 2,000 | in S Ltd | 20,000] — Creditors. 22,000 | 4.000 8,000 | 26,000 88,000 | 26,000 | re acquired by H Lid on 1st October 2011. Prepare the lance sheet of the holding company and its subsidiary as on 31st 10 The shares wer ‘consolidated bal March 2012. or 's of AS-21 in regard to preparation of consolidated balance Discuss the provision: sheet.ADVANCED CORPORATE ACCOUNTING 2014 Advanced Corporate Accounting The figures in the margin indicate full marks for the questions 1. Answer the following as per directed: ; = (@) Any profit eamed by a company before its incomporation is: transferred tg Account. (Fill in the blank), (b) The Cut off date for pre and post incorporation profit is : (i) Date of incorporation (ii) Date of commencement of business (iii) Any of the above two dates (wv) 1st April of the concemed year (Choose the correct alternative) (¢) To reduce Share Capital, Tribunals order is not always necessary. (State whether ‘True’ or ‘False’) (2) ‘After writing of all losses, the balance of Reconstruction Account is transfered to Account. (Fill in the blank) (©) Only insolvent companies can be liquidated. (State whether ‘True! or False) (9) The job of realising various assets and paying various liabilities in the case Of liquidation, in a systematic way, is performed by a person called (Fill in the blank) (g) What is Minority interest? (h) The cost of contro! for acquiring the shares of Subsidiary companies may show: (Choose the correct alternative) ) Goodwill (i) Capital Reserve (ii) Reserve Capital (iv) Contingent liability, 2. Answer as directed: The assets of Luit Ltd. are Rs. 5,00,000/-; liabilities are Re. 1,00,000/, Preference Shares are 10,000 shares of Rs. 10/- each having prior right and equity shares are 10,000 shares of Rs, 10/- each. Find the value of equity shares under asset back method, 3 Write 2 note on Reduction of Share Capital 3 What is Voluntary winding up of companies? 4 Mention three ways how a company can become a holding company. 3 (a) From the following information, calculate the value Per equity share: 2,000, 9% Preference Shares of Rs. 100/- each 50,000 equity shares of Rs. 10/- each, Rs. &/- per share paid up Expected Profit per year before tax Rate of Tax Transferred to General every year ate of eamingG.U. QUESTION PAPER (SEMESTER SYSTEM) — © Biplain the merits ‘ Piece ieee emeris of Assets Backing Method of valuation of shares. 5 ‘ - uumal entries of the following with suitable narrations: DHADARS () Conversion of fully paid equity shares of Rs, 10,00,000/- into equity stock. ro " Riad op vi Frounee 12% Preference Shares of Rs. 10- each fully f ,000, rence Shares of Rs. 100/- each. OR Briefly explain various modes of Alteration of Share Capital. 5 (©) From the following parculrs, ascertain Liquidator’ remuneration and also show | lance amount is to be distributed to the shareholders: 5 1 Preference Share Capital : (10,000 Shares of Rs. 10/- each, Rs. 9/- paid up) = Rs. 90,000/- ate Equity Share Capital: | (10,000 shares of Rs. 10/- each, Rs. 8/- paid up) = Rs, 80,000/- Be Preference Dividend in Arrear = Rs, 18,000/- Surplus of Cash after Paying all creditors = Rs. 2,04,000/- se’) Liquidator's remuneration is fixed at 2% on the amount distributed to the shareholders. ase or Hed Critically examine the different aspects of determining Liquidator’s Remuneration in the context of a company's liquidation. 5 (4) Write a brief note on Accounting Standard -21 5 may a Explain how the mutual owings between the holding company and the subsidiary sity. company are treated while preparing the consolidated Balance Sheet. 5 4a) X and Y working in a partnership, registered a Joint Stock Company under the name ‘of "NABAMA Ltd," on 1st September, 2013 to take over their existing business with poce | effect from 1st April, 2013. te From the following Proft and Loss Account forthe year ended 31st March, 2014 and ot S tho other details, prepare a statement of Profit and Loss apportioning the profits 8 fi between pre and_post incorporation period indicating your basis for appointment. 10 Zs Particulars Rs] Particulars fa. - To Salaries 70,000 | By Gross Profit bid 84,000/- e Jo Debenture Interest 5,0000 To Depreciation 2,000 To Interest on Purchase Consideration (upto 30.9.2013) To Selling Commission 10,800 12,000 800 1,0004144 ADVANCED CORPORATE ACCOUNTING Sales for the year totaled Rs. 2,25,000/- out of ner oe was related to. period from 1st September, 2013 to 31st March, 2014. Or Explain the various situations which necessitate the valuation of shares. 10 (b) The following is the Balance Sheet of UNFORTUNATE Ltd. as on 31st March, 2014, Liabilities Rs. Assets 20,000 Equity shares of Rs. 10/- each | 2,00,000/- | Goodwill 10,000 Preference Shares Machinery of Rs. 10 each 1,00,000/- | Inventory Convertible Debentures 30,000/- | Debtors Profit & Loss Account Deferred Expenses 3,30,000/- ] The company adopted the following scheme: (i) The equity shares were to be reduced to Rs. 6/- each and the preference: shares by Rs. 4/-each. (ii) Deferred expenses and Profit and Loss A/c were to be written off and machinery to be depreciated by 2% and inventory by 10%. Pass joumal entries to give effect to the scheme and prepare the new Balance Sheet. 10 or Elaborate the Accounting entries to be made in the books of a limited company that has adopted a scheme of Capital Reduction 10 (c)_ Eastern industries Ltd. went into voluntary liquidation on 31st March, 2014. The liquidator's remuneration was 3% on realization of assets and 2% on distribution ‘among the shareholders. The following was the position of the company a8 on 31st March, 2014: Rs. Cash realized on assets = 10,00,000 Expenses of Liquidation = 10,000/- Unsecured Credirors “= 70,000 (Including Preferential Creditors Rs. 8,000/-) 5,000, 6% Preference Shares of Rs. 30/- each = 1,50,000- (Dividend for two years is in arrear) 10,000 Equity Shares of Rs. 10/- each, Rs. 9/- paid = Reserves = Profit and Loss Account (Cr.) = Prepare Liquidator’s Final Statement of Account. OrShare Capital (Rs. 10/- per share fully paid) 1,00,000} 20,000 | inventory 61,000 | 24,000 Debtors 13,000 | 17,000 Bills Receivable 4,000 = 12,000 | Shares in S.Ltd 6,000 | (1,500 Shares of Rs.10 Profit and Loss A/c| Reserves 40,000 Creditors 12,000 | each }5,000 at cost) x Total 1,70,000| 53,000 | Total 7,70,000 | 53,000 ‘Additional Information: reference (i) All the profits of S. Ltd. have been eamed since the shares were acquired by H. Ltd., but the Reserve of Rs. 6,000/- was already there at the time of acquisition. ce (ii) Bills accepted by S. Ltd. are all in favour of H. Ltd. which has discounted Rs. machinery 2,000/- of them. (iil) Sundry assets of S. Ltd. are under-valued by Rs. 2,000/- Sheet. 10 or (() Explain any five advantages of a Holding company. (ll) Write a short note on the need for consolidation of financial statements.5+5=10 npany that 40 2014. The Dots distribution coke mpany as ADVANCED CORPORATE ACCOUNT! The figures in the margin indicate full marks for the questions. ne | 4, answer the following as por directed: 1x88 100,000 (2) Which if the following cannot be used for 1s8009 partly paid up bonus shares? 0,000 (i Profit and Loss Account (Cr) balance (ji) General Reserve 70,000/- (ji) Securities Premium Account {iv None of the above. (Choose the corect option) 4 (Fill in the blank) 000s ncorporation profit is transferred 10 ————— reserve. (f * Wma vs ee whether ‘true’ or ‘alse’) pen es nat @) oS canoes prepared as per Hat H incase of compulsory winding Deficiency or surplus Par | shows: { up : is Order of payment i)Os Hee monict = ‘company necessarily implies its insolvency. (State ') (9) A Balance Sheet includes all assets and liabilities of the parent subsidiaries. (Fill in the blank) (h) A company is called holding only when it acquires the whole of the share ‘of another company. (State whether ‘true’ or ‘false’) 2, Answer the following questions as directed: (a) Explain any three situations which warrant the valuation of shares. (6) Write a short note on internal reconstruction of companies. () Write a short on the preferential creditors under the Companies Act. (d) Briefly explain Minority Interest in the context of holding company. 3. Answer the following questions as directed: (2) Explain the methods of computing profit or loss prior to incorporation, or How is profit or loss made prior to incorporation treated in accounts? 5 (b) Pass journal entries of the following with suitable narrations: 2% +2 M5 () On 30.06.2015, Tangla Canes Ltd. passed a resolution regarding alteration o Capital and it decided to consolidate 60,000 fully paid equity shares of Rs. 10) - each into fully paid equity shares of Rs. 100/- each (li) UK Ltd. decides on 25.07.2015 to sub-divide its 15,000 equity shares of Rs. 100/- each fully paid into equity shares of Rs. 10/- each fully paid Or Briefly explain the different forms of intemal reconstruction of companies, 5 Barua Works Ltd. went into voluntary liquidation. The amount realized form assets is Rs. 60,000/- by the liquidator. The amount of unsecured creditors was Rs, 70,000) = (including preferential creditors Rs. 15,000/-) Calculate liquidator's remuneration if the liquidator is entitled to a remuneration of 6.5% on the assets realized and 2% on amount distributed to unsocured credits (4) Distinguish between holding company and subsidiary company. 5 4. (a) The Balance Sheet of Ashoka Industries Ltd. disclosed the following position on 31.03.2015 :to Reserve Account the industry in which the bbe taken at 10%. Rs. 51,600/- , 2014 : Rs. 52,000/- and 2015: Rs. 51,650/- of which 20% was ach year and this proportion being considered reasonable company is engaged and where a fair investment retum may Compute the value of each share of the company by: {@) Intrinsic Value Method (b) Yield Value Method (c) Fair Value Method.4+4+2=10 Or Explain the different methods of valuation of shares. (b) The Balance Sheet of Bad Luck Ltd. was as follows on 31.03.2015 : 10 Liabilities Assets SHARE CAPITAL 4,000 shares of Rs. 100/- each 6% Debenture Creditors 4,00,000 2,00,000 2,50,000 | Goodwill Buildings Machinery ‘Stock Debtors Preliminary Exp. Profit & Loss Account The following scheme of reconstruction was adopted: (i) Fictitious assets were to be written off (i) was to be written down to its proper value of Rs. 3,00,000/ ) The Shares wore to be reduced to Re. 20/- each. ibunal was duly obtained.12,000 Equity shares of Rs. 10 each Bank foan 8 % Debentures Interest ‘outstanding on Debentures Creditors Land & Buildings Other Fixed Assets Stock Debtors 1,20,000 | Profit & Loss A/c 4,00,000 1,00,000 ‘The company went voluntary liquidation on that date. Prepare Liquidator's Final Statement of @ (i) (ily (iv) Rs. 10,000/- respectively. What are the different modes of v the liquidators under compulsory winding (4) HORSE Ltd. acquired 640 equi The following are the Balance Sheet: Bank Loan was secured by pledge of stock. Debentures and Interest thereon wo: Fixed Assets were realized al book Or Up of companies, the ity shares of DONKEY Ltd. on two companies as at 31st Decamber, 2014s ‘ount after taking into consideration the follo Liquidation expenses and Liquidator’s remuneration amounted to Rs.3,000/- ang fe secured by a floating charge, on all a Values and current assets at 70% of book ing up of a company? Describe the powers of Horse Tiabilities T ee Share Capital ‘Share of 100/- each General Reserve (01.01.2014) Profit and Loss A/c (01.01.2014) Profit for the year | Sundry Creditors 1,60,000 Assets | Donkeyy [Rs | Land & Buildings 80,000 | Plant & machinery 16,000 | Stock Sundry Debtors Investment in share of Donkey Ltd. Bills receivable | Horse [Rs ‘ist January, 2014,following: ,000/- and all assets, values. ) powers of 3+7=10 uary, 2014. aber, 2014: Additional Information: betaeth eau {() Bills Receivable of HORSE Lid. include Rs. 800/- accepted by DONKEY Lid. (i) Sundry Debtors of HORSE Ltd. include Rs. 4,000/- due form DONKEY Lid. (ii) Stock of DONKEY Ltd. includes goods purchased form HORSE ,800/- ich was invoiced by HORSE Lid. st a profl of 20% ane Prepare a consolidated Balance Sheet of HORSE Ltd. and its subsidiary DONKEY Ltd. as at 31st December 2014. 10 Or Explain the advantages and disadvantages of a Holding company. 5+5=10 2016 ADVANCED CORPORATE ACCOUNTING The figures in the margin indicate full marks for the questions. 4. Answer the following as directed: 118=8 (a) What is ‘intrinsic value' of 2 share? (b) ‘Profit earned prior to incorporation cannot be distributed as divided’. (State whether True or False). (c) After writing off all losses, the balance of Reconstruction Account is transferred to Account. (Fill in the blank) (4) What is Capital Reduction Account? (e) State the meaning of winding up of a company. (The liquidation caused by inability to pay debt Is referred to as liquidation, (Fill in the blank) (g) In India, preparation of Consolidated Financial Statement is . (Fu in the blank selecting appropriate option from below): () Mandatory (i) Not mandatory (i) Mandatory under Companies Act (¥) Mandatory fr listed companies, ‘The parent organisation acquiring controling interest in another company (h) is called the holding company. 2. Answer as directed: (e) Explain the Asset Backing Method of valuation of sheres. ey ‘any three situations which call for Intemal reconstruction of yee —“e"(a) The following particulars relates to ABC Ltd: Total assets Rs. 18,75,000 Extemal liabilities Rs. 2,75,000 Share capital : 14% Preference shares of Rs. 10 each, fully paid Rs. 5,00,000 40,000 Equity shares of Rs. 10 each, fully paid Rs. 4,00,000 60,000 Equity shares of Rs. 10 each, Rs. 7.50 paid, Rs. 4,50,000, Calculate the value of each category of equity shares of the company, or Mention the factors which influence the valuation of a company’s share. CMD Ltd. passed a resolution on 30th June, 2016 to convert its 80,000 fully» Squity shares of Rs. 10 each into Rs. 7 per share fully paid up and to retum Re; 3 per share to equity shareholders. Pass necessary journal entries in the books of the company. Or Briefly explain various modes of alteration of share capital. (c) Prepare the list of preferential creditors in respect of liquidation of a co (2) Explain briefly the need for preparation of consolidated financial statement (@) Bright Star Ltd. was incorporated on 1st July, 2015 to acquire a runni business with effect from ‘st Apri, 2015. The accounts for the year ended 31 March, 2016 disclose the following: (i) There was a gross profit of Rs. 3,00,000. (ii) The sales for the year amounted to Rs. 12,00,000 of which Rs, 2,40, were for the first three months. (il) The expenses debited to the Profit and Loss Account included: Directors fees Rs. 15,000 Bad debts Rs. 3,600 ‘Advertising Rs. 12,000 (under a contract amounting to Re. 1,000 __ Per month)G.U. QUESTION PAPER (SEMESTER SYSTEM) Or the , PGR selears fo Sicwaitne Heh onal or Oo ae Pe ® (b) Following was the Balance Sheet of Rajashree Ltd. as on 31st March, 2016: " BALANCE SHEET AS ON 31.3.2016 let Particulars ‘in we) |. EQUITY AND LIABILITIES: 5 1. Shareholders’ Fund: (a) Share capital : are: 4 15,000 Equity shares Of 000 fully paid Rs. 10 each 1,50,000 to retum Rs, 15,000 7% Preference shares of Rs. 10 each 1,50,000 5 (b) Reserves and Surplus: ‘Surplus (debit balance of 5 Profit and Loss Account) (60,000) sf a company. 2. Current Liabilities: 5 (a) Trade payables : statement.5 Creditors ire a running Total ar ended 31st ll. ASSETS = 4, Non-current assets: {a) Tangible assets: ae 8 ‘Machinery Troyes {b) Intangible assets: Goodwill 25,000 2. Current assets + (ey StockEquity shares of Rs. 10 each be reduced to shares and 7% preference shares of Rs. 10 each be shares of Rs. 7 each fully pald up. The number to remain the same, The amount so available be used for writing off fictitious and intangible and machinery to the extent possible. Pass necessary journal entries in the books of the company and p the Balance Sheet after the above entries. Or Elaborate the accounting entries to be made in the books of a limited com that has adopted a scheme of intemal reconstruction. North-East Co. Ltd went into voluntary liquidation having the following liab Unsecured creditors Rs. 85,000. Secured creditors Rs. 58,000 (realisable value of securities Rs. 65,000). Creditors for tax and government revenue Rs. 15,000. 8 % debenture having a float charge on the assets Rs. 18,000, Interest due on debenture Rs. 560. Liquidation expenses amounted to Rs. 400. The liquidator is entitled to a remuneration of 5% on the assets realised of 3% on the amount distributed to unsecured creditors. The various’ (excluding the securities held by secured creditors) realised Rs, 85,000. Prepare Liquidator’s Final Statement of Account showing the proportion paid to | unsecured creditors. 10 Or features of Liquidator's Final Statement of Account. Explain the of determining the liquidator’s remuneration on the liquidation hin is|. EQUITY AND LIABILITIES: 4, Shareholders’ Fund: (a) Share capital : Equity shares OF Rs. 10 each (b) Reserves and Surplus: Surplus (Balance of statement of profit and loss) 2, Current Liabili Trade Payables : Pare 10 mpany 10 bilities: Sundry Creditors 00). ll, ASSETS: 4. Non-current assets: (a) Tangible assets: 68,000 (b) Non-current investments 1,600 shares in S. Ltd Total sed and “The shares were acquired by H. Ltd. on 1st October, 2015, You are required to ascertain as per AS-21. (The equity ofthe subsidiary on the date of acquisition of shares by H. Ltd. and the share of H. Ltd and ‘Minority in the equity of the subsidiary. quity of the subsidiary since the date of parent -subsidiary (i) “The movement in the & relationship. } (iii), The Minority Interest on 31st March, 2016. 2 w) The cost of control / capital reserve. ‘ 7 10aule Advanced Corporate Accounting (Accountancy Major) | Paper : 3.6 Full Marks - 80, Time : 3 hours 4. Answer the following as directed : 1x8=8 | (2) Pre-incorporation profit is transferred to .........Reserve Account. (Fill in the blank). ; Wh} (b) What is the Book-value of a share? } (c) The balance of Capital Reduction Account is transferred to General Reserve i Account. (State whether ‘true’ or false’). (d) What is Consolidation of shares in the contest of internal reconstruction. of a company? (€) In case of compulsory winding up, the remuneration of the liquidatior is fixed by the (Fill in. blanks). () Who are the preferential creditors in respect of liquidation of a company? | (9) What is Consolidated Financial Statement? | (h) Minority interest is equal to nominal value of shares held by minority shareholders. (State whether ‘true’ or ‘false’. 2. Answer as directed : 3x4=12 (2) Write a short note on Yield method of valution of shares. i i (b) Briefly explain internal reconstruction of companies. (c) What is voluntary winding up of companies? ""({d) Briefly explain Minority Interest in the context of holding company. | 3. Answer as directed : (@) From the following information, calculate the value per equity share 5 3,000, 6% preference shares of Rs. 100 each . a Rs. 3,00,000 50,000 Equity shares of Rs. 10 each, Rs. 8 per share paid up Rs. 4,00,000 Expected profit per share before tax Rs. 2,20,000 Rate of Taxtion of is nority =12 G.U. QUESTION PAPER (SEMESTER SYSTEM) Transferred to General Reserve every year 20% of profit. Normal rate of earning 1% Or Explain the merits and demerits of AssetsBacking Method of valution of shares. 5 (b) Briefly explain the methods of reduction in share capital. 5 (©) Tiskon Ltd. went into voluntary liquidation. Cash available before payment to unsecured creditors is Rs. 80,000. ' Unsecured creditors Rs. 50,000 ‘Share capital (Shares of Rs 10 each) Rs. 50,000 Calculate remuneration of liquidator if he is entitled to a commission of 4% ‘on the amount distributed amont unsecured creditors and 2% on the amount distributed among shareholders. 5 Or State the different modes of winding up of a company. 5 5 (@) Distinguish between holding company and subsiciary comPany: 4, {@)__ The following particulars are available in retaion to Good Luck Ltd.: () Capital 450, 6% Preference Shares of Rs. 100 each fully paid. \ 4,500 equity Shares of Rs. 10 each fully paid. (i) External liabilities Rs. 7,500. (ji) Reserve and surplus Rs. 3,500. (W) The average expected profit (after taxation) earned by the company Rs. 8,500. °) “The normal prof earned on the market value of Equty Shares (Aly paid) of the same fype of companies 8 036, ™ 10% of he prt after ax oath yar ansiorad io Resins ity share, jue per share and te ey are a bis of total assets, 80-01 HOHE(b) The following is the Balance Sheet of Rose Ltd. as on 31st Dec oe) 2016: Particulars 1. EQUITY AND LIABILITIES = 1. Shareholders’ fund : (@) Share capital: 20,000 Equity Shares of Rs. 10 each fully paid 10,000 preference shares of Rs. 10 each fully paid (&) Reserves and Surplus : Surplus (Debit balance of profit and Loss Account) 2. Non-current liability : Convertible Debentures Total I. ASSETS 1. Non-current Assets : (@) Tangible Assets : Mackiney, 1,00,000 (b) Intangible Assets : ‘Goodwill 10,000 2, Current Assets : (@) Inventory 50,000 (0) Trade Receivables Debtors Pi (©) Other Current Assets : Deferred Expenses Total The company adopted the following scheme : (i) The equity shares were to be reduced to Rs, é ‘shares by Rs. 4 each, 6 each and the pr “ ‘: Fone mech went Pro end Loas 9 ey yas 2h aG.U. QUESTION PAPER (SEMESTER sysTEM) 4A87 Or What is meant by Capital Reduction Account? Disc a Companies Act with regard to reduction of cabal pele Cte (©) Sunflower Ltd. went into voluntar flower Lid y liquidation on 31st January 2016. Pre Liquidator's Final Statement of Account from the following dort eat that preference shareholders have preferential ri paym hat ight as regards the payment of dividend but does not have preferential right as to refund of capital, Rs. Long term loan 40,000 Trade creditors 24,000 20,000, 8% Preference Shares of Rs. 10 each fully paid up | — 2,00,000 20,000 Equity Shares of Rs. 10 each fully paid up 2,00,000 (Preference dividend is in arrear for one year) Assets realised 3,92,000 Liquidation expenses amounted to Rs. 6,000. Liquidator is entitled to a remuneration of 10% on the amount distributed to shareholders. 10 | or State the meaning of Contributory and their responsibility over liquidation of | companies. 6+4=10 Describe the powers ofthe liquidator under compusory winding up of compari, +4 (©) The following is the Balance Sheets of H. Ltd. and its subsidiary S. Ltd. as on 31st March, 2017. Particulars H. Ltd, (Rs.)| S. Ltd.(Rs.) I. EQUITY AND LIABILITIES: 4. Shareholders’ Fund: share capital : 3 a Spcies of Rs. 10 each 60,000 |} 20,000 | (b) Reserves and Surplus : ‘Surplus (Balance of Statement of Profit and Loss) 2. Current liabilities : ‘ Trade payables : 5,000 4,000 23,000 2,0001. Non-current Assets : (@) Tangible Assets (0) Non-current investment 1,600 shares in S. Ltd. Total The shares were acquired by H. Ltd. on 31st March, 2017. Prepare the Consolidated Balance Sheet of the holding company and its subsidiary as on 34st March, 2017. 10 Or Explain the advantages and disadvantages of a holding company. 5+5=10