Loyola College B.Com Corporate & Secretaryship April 2011 Company Accounts Question Paper PDF Download

LOYOLA COLLEGE (AUTONOMOUS), CHENNAI – 600 034

B.Com. DEGREE EXAMINATION – CORPORATE SEC.

FOURTH SEMESTER – APRIL 2011

BC 4502/BC 4500 – COMPANY ACCOUNTS

 

 

 

Date : 08-04-2011              Dept. No.                                        Max. : 100 Marks

Time : 1:00 – 4:00

 

SECTION – A

Answer ALL questions :                                                                                         (10 x 2 = 20 marks )

 

  1. What is partial underwriting of shares ?
  2. Name any four preferential creditors.
  3. Write a note on Capital Redemption Reserve ?
  4. What do you understand by the term ‘Forfeiture of shares’ ?
  5. Distinguish between ‘Ex-Interest’ and ‘Cum-Interest’ ?
  6. Calculate the goodwill at one year’s purchase of the last three year’s average profit. The profit for the 1st year was Rs.6,000, 2nd year Rs.12,000 and the 3rd year Rs.18,000.
  7. Raj Ltd. issued 40,000 equity shares of Rs.10 each payable as Rs.5 on application and Rs.5 on allotment. Applications were received for 50,000 shares and the allotment was made on pro-rata basis. Krishna to whom 400 shares were allotted, failed to pay the allotment money and his shares were forfeited. Calculate the net amount received on allotment for the remaining shares.
  1. X Ltd. decides to redeem 650, 15% redeemable preference shares of Rs.100 each at premium of 10%. It has a general reserve of Rs.70,000 and Securities premium of Rs.4,000. Calculate the amount required to be transferred to Capital Redemption Reserve a/c in the following cases :-

(a)   If it is decided to issue 1,950 Equity shares of Rs.10 each at 30% premium for the

purpose of redemption of Preference shares.

(b)   If it is decided to issue 3,125 Equity shares of Rs.10 each at 20% discount for the

purpose of redemption of Preference shares.

 

  1.     The liquidator of a company is entitled to a remuneration of 2% on assets realized and    3% on the amount distributed to unsecured creditors. The assets realized Rs.1,00,000 including cash balance of Rs.5,000. Amount available for distribution to unsecured creditors before paying liquidators remuneration was Rs.43,100. Calculate liquidator’s remuneration.

 

  1. 75% of an issue of 3,00,000 shares of Rs.10 each is underwritten by R & Co. Applications totaled 2,00,000 shares. Determine the liability of the underwriters ?

SECTION – B

Answer any FIVE questions :                                                                                  ( 5 x 8 = 40  marks)

 

  1. State the provisions of the Companies Act regarding the calculation of net profits available for managerial remuneration.

 

  1. State the legal requirements for alteration of share capital.
  2. G Ltd. issued 2,000, 12% debentures of Rs.100 each on 1.1.2005 at a discount of 10%, redeemable at premium of 15% in equal annual drawings in 4 years out of profits. Give    journal            entries both at the time of issue and redemption of debentures.

 

 

  1. Determine the maximum remuneration payable to the part time directors and manager under

Section 309 and 387 from the following particulars:

Before charging any such remuneration the Profit & Loss account showed a credit balance of Rs.23,05,000 for the year ended 31.03.2008 after taking into account the following particulars:                                                                  Rs.

Profit on sale of investments                                      2,05,000

Subsidy received from government                            4,10,000

Loss on sale of  fixed assets                                          65,000

Ex-gratia to an employee                                               30,000

Compensation paid to an injured workman                   75,000

Provision for taxation                                                 2,79,000

Bonus to foreign technicians                                      3,12,000

Multiple shift allowance                                             1,00,000

Special depreciation                                                       75,000

Capital expenditure                                                     5,10,000

  1. AB Ltd. issued 1,50,000 equity shares. The whole of the issue was underwritten as follows:

X – 50%; Y – 25% and Z – 25%. Applications for 1,20,000 shares were received in all, out of which applications for 30,000 shares under stamp of X, those for 15,000 shares that of Y and those for 30,000 shares that of Z. The remaining shares did not bear any stamp. Determine the liability of the underwriters.

  1. The balance sheet of Wallace Ltd. as on 31.12.2007 was a under:

Rs.                                                                 Rs.

Redeemable preference shares                        Sundry assets                          3,65,000

of Rs.100 each                         1,00,000        Bank                                        1,40,000

Equity shares of Rs.100 each    2,00,000

General reserve                            80,000

P & L a/c                                      50,000

Creditors                                      75,000

———–                                                        ————

5,05,000                                                        5,05,000

On this date the preference shares were redeemed at par. Journalize and prepare balance sheet after redemption.

 

  1. A company went into voluntary liquidation on 31.03.2008, when the following balance sheet was prepared.

Liabilities                                                         Assets

Rs.                                                       Rs.

3,000 shares of Rs.10 each                 30,000 Goodwill                                 6,960

Unsecured creditors                            15,532 Freehold property                   5,000

Partly secured creditors                        5,836 Machinery                               7,480

Preferential creditors                              810   Stock                                     11,710

Bank O/D                                               332   Debtors                                   9,244

Cash                                           100

P & L a/c                               11,816

——–                                               ———-

52,310                                               52,310

The liquidator realized the assets as follows:

Freehold property Rs.3,600; Machinery Rs.5,000; Stock  Rs.6,200;  Debtors Rs.8,700.

The expenses of liquidation amounted to Rs.100 and the liquidator’s remuneration was agreed at 2.5% on the amount realized including cash and 2% on the amount paid to unsecured creditors. Prepare the liquidator’s final statement of account.

 

 

 

 

 

  1. Following are the Balance sheets of two companies as on 31.3.2006

Liabilities                    XLtd.              Y Ltd.

Share capital ( shares of Rs.10  each )           25,000             40,000

Capital reserves                                              5,000               ___

General reserves                                             18,000             50,000

Loans                                                             11,000             20,000

Creditors                                                        21,000             23,000

Provision for tax                                            5,500               26,000

Proposed dividend                                         ___                  5,000

____________________

85,500             1,64,000

___________________

Assets

            Fixed assets                                                     41,500             80,000

Investments                                                     8,500               _

Current assets                                                  34,500             84,000

Goodwill                                                         1,000               –

                                                                                    ____________________

85,500             1,64,000

___________________

Additional information :

  1. X Ltd is absorbed by Y Ltd
  2. Goodwill of X Ltd is worthless
  3. Fixed assets of X Ltd are valued at Rs.39,500
  4. Shareholders of X Ltd are given shares of Y Ltd on the basis of the intrinsic value of these two companies.

Calculate the intrinsic value  of shares of both companies.

SECTION – C

Answer any TWO questions :                                                                                  ( 2 x 20 = 40 marks)

 

  1. Unstable Ltd. went into compulsory liquidation . Their summarized Balance Sheet as at 31st March 2009 appears as under:

 

Liabilities                                                Rs.                Assets                                Rs.

   2,50,000 Equity shares of Rs.10 each     25,00,000    Land and Buildings               5,00,000

Secured Debentures

(secured on Land & Building)              10,00,000    Other Fixed Assets             20,00,000

Unsecured Loans                                     20,00,000    Current Assets                    45,00,000

Trade Creditors                                        35,00,000    Profit & Loss a/c                 20,00,000

90,00,000                                                90,00,000                    Contingent liabilities are :                               Rs.

for Bills Discounted                                        1,00,000

for Excise duty demands                                1,50,000

 

On investigation, it is found that the contingent liabilities are certain to devolve and that the assets are likely to be realized as follows :                Rs.

Land and Buildings                                        11,00,000

Other Fixed Assets                                         18,00,000

Current Assets                                                            35,00,000

Prepare the Statement of Affairs and Deficiency A/c.

 

 

 

 

 

 

 

  1. The following is the Balance sheet of United Industries Ltd on 31.3.2008

 

Liabilities                     Rs.                Assets                            Rs.

Share capital:

6,000 6% preference shares         6,00,000        Goodwill                        45,000

Of Rs.100

12,000  equityshares of Rs.100  12,00,000        Land &Building          6,00,000

8% Debentures                             3,00,000        Plant                            9,00,000

Bank overdraft                             3,00,000        Stock                           1,30,000

Sundry creditors                                      1,50,000        Debtors                       1,40,000

Cash                               15,000

Profit&loss account    7,00,000

Preliminary expenses      20,000

 

25,50,000                                            25,50,000

 

On the above date, the company adopted the following scheme of reconstruction

  1. The equity shares are to be reduced to shares of Rs.40 each fully paid and the preference share to be reduced to fully paid shares of Rs.75 each.
  2. The debenture holders took over stock and debtors in full satisfaction of their claim.
  3. The land and buildings to be appreciated by 30% and plant and machinery to be depreciated by 30%.
  4. The fictitious and intangible assets are to be eliminated.
  5. Expenses of reconstruction amounted to Rs.5,000.

Give journal entries incorporating the above scheme of reconstruction and prepare the reconstructed Balance sheet.

 

  1. From the following Balance sheets prepare a Cash Flow Statement.                                                                       2008          2009                                              2008              2009

                                             Rs.              Rs.                                                   Rs.                Rs.

Capital                 1,80,000      1,80,000          Cash                        40,000           50,000

P & L a/c                23,000         16,000          Debtors                   73,000           77,000

Reserve                  50,000         60,000          Investments             84,000        1,10,000

Debentures          1,14,000      1,30,000          Prepaid expenses     2,000               1,000

Prov. for tax         22,000           13,000          Stock                     1,06,000          92,000

Creditors                96,000      1,03,000          Machinery             1,79,000       1,71,400

Goodwill                    1,000               600

————-        ———–                                        ———–       ————

4,85,000      5,02,000                                        4,85,000       5,02,000

————-        ———–                                        ———–       ————

Additional information:

  • New machinery for Rs. 15,000 was purchased but old machinery costing Rs. 6,000 was sold for Rs.2,000 on which accumulated depreciation was Rs. 3,000.
  • Interim dividend paid 10,000.
  • Tax paid during the year Rs.25,000.

 

 

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