LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034
B.Com. DEGREE EXAMINATION – CORPORATE SECRETARYSHIP
FOURTH SEMESTER – April 2009
BC 4502 – COMPANY ACCOUNTS
Date & Time: 24/04/2009 / 9:00 – 12:00 Dept. No. Max. : 100 Marks
SECTION-A(10 x 2 = 20 MARKS)
ANSWER ALL QUESTIONS
- Explain pro-rate allotment of shares.
- Explain the meaning of “Redeemable preference shares”.
- What is a sinking fund?
- What is Managerial Remuneretion?
- The Chennai motors Ltd issued 2,00,000 equity shares of Rs.10 each.The whole issue
was underwritten by Ramesh. Applications for 1,60,000 shares were received in all.
Determine the liability of underwriter.
- Joseph Ltd was incorporated on 1st may 2008 to purchase the running business of Alfred &co.,
with effect from 1st january 2008.The company obtained a certificate of commencement of
business on 24th Aug 2008.Calculate Time Ratio,if the accounts were finalised on 31st Dec.2008
- What is meant by Acquisition of business?
- How will you calculate the Cash flow from operating activities under direct method?
- What is liquidation of a company?
10 .Calculate the goodwill in the following case:
Goodwill is to be calculated at one year’s purchase of the last 3 years’average profit.The profit of
the first year was Rs.6000,Second year twice the profit of the first year and the third year one and
half times the profit of the second year.
SECTION-B(5 x 8 = 40 MARKS)
ANSWER ANY FIVE QUESTIONS
- K Ltd,purchased the business of Mani Bros for Rs.54,00,000 payable in fully paid shares of
Rs.100 each What entries will be made in the books of K Ltd.if such issue is (a) at par (b) at a
premium of 20% and (c) at a discount of 10%?
- Suresh Ltd issued 75,000 equity shares of Rs.10 each and 5000 redeemable preference shares of
Rs.100 each all shares being called and paid up on 31-3-2008.Profit & loss account showed
undistributed profits of Rs.3,00,000 and general reserve stood at Rs.2,50,000. On 1-4-2008, the
directors decided to redeem the existing preference shares at Rs.105 utilising as much profits as
would be required for the purpose. Pass journal entries, in the books of the company.
- Mahesh Ltd issued 50,000 8%.Debentures of Rs.10 each to the public at par,to be paid Rs.4 on
application and the balance on allotment.
Applications were received for 48,000 debentures.Allotment was made to all applicants and the
amount due was received promptly.
Give journal entries to record the above transactions.
- From the following particulars of JG Ltd ,Calculate the Managerial remuneration assuming there
are two whole time directors,a part -time director and a manager.
Rs.
Net profit before provisions for income tax 8,70,410
and managerial remuneration but after depreciation
Depreciation provided in the books 3,10,000
Depreciation allowable under schedule XIV 2,60,000
15 .Write a note on “Vendors Suspense Account”
- Draft a Balance sheet of a limited company in prescribed form as per
schedule VI of Indian Companies Act with imaginary figures.
- Bring out the various methods of valuation of shares.
- A Liquidator is entitled to receive remuneration @ 2% of the assets
realised and 3% on the amount distributed among the unsecured creditors.The assets realised
Rs.70,00,000 other details are as follows:
Liquidation expenses Rs.50,000
Preferential creditors Rs.1,50,000
Secured Creditors Rs.40,00,000;
Unsecured Creditors Rs.30,00,000
Prepare Liquidators final statement of Account.
SECTION-C(2 x 20 = 40 MARKS)
ANSWER ANY TWO
- A Ltd invited applications for 10,000 shares of Rs.100 each at a discount of 5% payable as
follows:
on application Rs.25
on allotment Rs.34
on first & final call Rs.36
Applications were received for 9000 shares and all of these were accepted.All moneys due were
received except the first and final call on 100 shares which were forfeited.Of the forfeited
shares,50 shares were re-issued at the rate of Rs.90 as fully paid.Show necessary journal entries in
the books of the company.
- From the Balance sheets of MM Ltd. Make out the statement of cash flow
BALANCE SHEETS
Liabilities 2007 2008 Assets 2007 2008
Rs Rs Rs Rs
Equity share capital 3,00,000 4,00,000 Goodwill 1,15,000 90,000
8% Redeemable 1,50,000 1,00,000 Land & buildings 2,00,000 1,70,000
pref.share capital
General 40,000 70,000 Plant 80,000 2,00,000
reserve
P/L a/c 30,000 48,000 Debtors 1,60,000 2,00,000
Proposed dividend 42,000 50,000 Stock 77,000 1,09,000
Creditors 55,000 83,000 Bills receivable 20,000 30,000
Bills payable 20,000 16,000 Cash in hand 15,000 10,000
Provision for 40,000 50,000 Cash at bank 10,000 8,000
taxation
———- ———— ——— ———– –
Total 6,77,000 8,17,000 6,77,000 8,17,000
———- ———- ———- ———-
Additional information:
(a) Depriciation of Rs.10,000 and Rs.20,000 have been charged on plant a/c and Land & buildings a/c
respectively in 2008.
(b) An interim dividend of Rs.20,000 has been paid in 2008.
(c) Income -tax Rs.35,000 was paid during the year 2008.
- A company’s position on 31st march 2008 was follows:
Rs.
20,000 Equity shares of Rs.100 each 20,00,000
1,000; 12% debentures of Rs.100 each 10,00,000
Interest on above 1,20,000
Creditors for goods 5,00,000
The assets on that date were:
Fixed assets 20,00,000
Current assets 6,50,000
The following scheme of reconstruction was implemented:
(a) The fixed assets were valued at Rs.9,60,000 and the current assets at Rs.4,80,000
(b) The shares were sub-divided into shares of Rs.5 each and 90% of the shares were surrendered.
(c) The total claims of the debenture holders were reduced to Rs.4,90,000 and in consideration of
this,they were alloted shares, out of the surrendered shares ,amounting to Rs.2,50,000.
(d) The creditors agreed to reduce their claims to Rs.3,00,000, 1/3 of which was to be satisfied by the
issue of equity shares out of those surrendered.
(e) The shares surrendered, but not re-issued, were cancelled.
Draft Journal entries and give the Balance sheet of the company after reconstuction.
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