TABANI’S SCHOOL OF ACCOUNTANCY

FAR-I ADDITIONAL PRACTICE QUESTION

STATEMENT OF CHANGES EQUITY

Q.1. Following balances were extracted from the books Fatee Ltd as at 31st December 2019: (08)

Rs.000’s

 Share Capital (@Rs.100 each) 300,000

 Share Premium 20,000

 Surplus on Revaluation (on plant) 35,000

 Retained Earning 110,000

Relevant information for 2020:

 Final dividend proposed for 2020 @20% (2019 @18% – approved by shareholders on 10th
February 2020 @15%).
 Interim stock dividend declared @15% on 1st July 2020. (2019 @10% cash dividend).
 On 1st September 2020 bought Plant & Machinery having fair value Rs.80,000,000 and
issued 700,000 shares, fully paid shares.
 Net profit for 2020 was Rss.55,000,000.
 Following Revaluation was certificated by qualified valuer
o Plant – upward Rs.6,000,000
o Vehicle upward Rs.7,000,000
(During 2018 downward was charged to retained earning Rs.2,000,000)
o Furniture downward Rs.600,000

 Incremental deprecation for 2020 was Rs.4,500,000

Required:
Prepare Statement of Changes in Equity for the year ended 31st December 2020.

From the desk of Sir Sharif Tabani Page 1 of 2

TABANI’S SCHOOL OF ACCOUNTANCY
FAR-I ADDITIONAL PRACTICE QUESTION

STATEMENT OF CHANGES EQUITY

Q.2. Following balances were extracted from the books of PK Ltd (PKL) as a 31 December 2018: (08)

Rs.’000’
Ordinary share capital @100/- each 250,000
Share premium 40,000
Surplus on Revaluation (Land Rs.35,000; Building Rs.25,000) 60,000
Un-appropriate Profit 120,000

Transactions for 2019:

(1) The directors have proposed final dividend on 2nd February 2020; on ordinary
shares @15/- (2018 @12% - Stock Dividend).

(2) On 1st July 2019 interim dividend was made @10% on ordinary capital.

(3) Right issue was made @ one for every five shares held at premium of Rs.120
each.

(Rs.’000’s)
Land Building
Balance as at 31 December, 2019 before revaluable cost 85,000 260,000
 Accumulated depreciation - 80,000
 Re-valued amounts as at 31 December, 2019 72,000 156,000

(4) PKL has revalued its assets as 31 December, 2019 but effect is not incorporated
in above balance.

(5) Profit before above adjustment is 48 million and transfer of incremental

depreciation is Rs.6 million (credited to unappropriated profit).

Requirement:
Prepare statement of changes in equity for the year ended 31 December 2019.

From the desk of Sir Sharif Tabani Page 2 of 2