ULTIMATE BOOK OF ACCOUNTANCY

(Author: Dr. Vinod Kumar, Publisher: Vishvas Publications)

Class - XII Accountancy (Text Book Solutions)

Chapter -02 (Part – B): Financial Statements of a Company Part-1

Complete solutions of the very popular book

“ULTIMATE BOOK OF ACCOUNTANCY” class 12th CBSE.
This book is written by a renowned author ‘Dr.Vinod
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PRACTICAL PROBLEMS
1. Major Headings and Sub Headings

Particulars Major Heading Sub-heading

Goodwill Non Current Assets Fixed Tangible Assets

Provision for Tax
Loose Tools
Unclaimed dividend
Securities Premium
Share Forfeiture
Current Liabilities Short-term Provisions
Current Assets Inventories
Current Liabilities Other Current Liabilities
Shareholders Funds Reserves & Surplus
Shareholders Funds Share Capital
(Through notes to Accounts)

Calls in Arrears Shareholders Funds Deduct in Subscribed Capital while

preparing notes to accounts

Shares in Bajaj Hindustan Non Current Assets Non Current Investments

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 2. Major Headings and Sub-headings

Particulars Major Heading Sub-heading

Preliminary Expenses To be written off against the Reserves & Surplus

Bills Receivable Current Assets Trade Receivables
Authorised Capital Will be shown in Notes to Accounts and the final amount after all
adjustments (Called up & paid up) will be shown under the major
heading Shareholders Fund as Share Capital.

10% Debentures Non Current Liabilities Long term Borrowings

Bills Payable Current Liabilities Trade Payables
Underwriting Commission To be written off against the Reserves & Surplus
Calls in Advance Current Liabilities Other Current Liabilities

Patents and Trade Marks Non Current Assets Intangible Assets

3. Major Headings and Sub-headings

Particulars Major Heading Sub-heading

Sundry Creditors Current Liabilities Trade Payables

Debentures Sinking Fund Shareholders Funds Reserves & Surplus
Bills Receivable Current Assets Trade Receivables
Discount on Issue of Debentures To be written off against the Reserves & Surplus
Motor Car Non Current Assets Tangible Assets
Mortgage Loan Non Current Liabilities Long term Borrowings
Provision for Tax Current Liabilities Short-term Provisions

4. Major Headings and Sub Headings

Particulars Major Heading Sub-heading

Loose Tools Current Assets Inventories

Bills Receivable Current Assets Trade Receivables
Sundry Debtors Current Assets Trade Receivables
Livestock Non Current Assets Tangible Assets
Advances recoverable in cash or Current Assets Short term loans & advances
kind for value to be received.

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Preliminary Expenses To be written off against the Reserves & Surplus
Interest accrued on Investments Current Assets Other Current Assets

Bills of Exchange Current Assets Trade Receivables

Furniture Non Current Assets Tangible Assets

5. Balance Sheet (Extract only)

Particulars Note Figures as at Figures as at

No. the end of the end of
current previous
reporting reporting
period period

A. EQUITY AND LIABILITIES

(1) Shareholders’ Funds

(a) Share capital 1 1,96,000

(2) Share application money pending Allotment

(3) Non – current liabilities

(a) Long term borrowings 2 60,000
(4) Current liabilities
(a) Trade payables (Creditors) 30,000

Notes to Accounts :
1. Share Capital
Called up and Paid up capital 2,00,000
Less : Calls in Arrears 4,000 1,96,000

2. Long Term Borrowings

Loan from IDBI 40,000
12% Fixed Deposits 20,000 60,000

6. Balance Sheet (Extract only)

Particulars Note Figures as at Figures as at

No. the end of the end of
current previous
reporting reporting
period period

A. EQUITY AND LIABILITIES

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(1) Shareholders’ Funds

(2) Share application money pending

Allotment

(3) Non – current liabilities

(a) Long term borrowings (10% Debentures) 47,500
(4) Current liabilities
(a) Short term provisions (Provision for tax) 1,500

B. Assets

1) Non-Current Assets
(a) Fixed assets
(i) Tangible assets
(ii) Intangible assets (Goodwill) 5,000
(2) Current Assets
(a) Inventories (Stock in Trade) 10,000
(b) Other current assets (Preliminary Expense) 35,000

Note : Preliminary expenses cannot be written off in the current year becuase profit or free reserves are
not given in the question.

7. Balance Sheet (Extract only)

Particulars Note Figures as at Figures as at

No. the end of the end of
current previous
reporting reporting
period period

A. EQUITY AND LIABILITIES

(1) Shareholders’ Funds

(a) Share capital 1,70,000
(b) Reserves & Surplus (Securities premium) 10,000

(2) Share application money pending Allotment

(3) Non – current liabilities

(a) Long term borrowings (10% Debentures & FD) 70,000
(4) Current liabilities
(a) Trade payables (Creditors) 10,000

Long term borrowings = 10% Debentures + Fixed Deposits

8. Balance Sheet (Extract only)

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 Particulars Note Figures as at Figures as at
No. the end of the end of
current previous
reporting reporting
period period

A. EQUITY AND LIABILITIES

(1) Shareholders’ Funds

(a) Share capital 18,00,000
(b) Reserves and surplus (Statement of P/L) (1,20,000)
(c) Money received against share Warrants

(2) Share application money pending

Allotment

(3) Non – current liabilities

(a) Long term borrowings (12% Debentures) 4,00,000
(4) Current liabilities
(a) Short term borrowings (short term loan) 1,00,000
(b) Trade payables (creditors) 50,000
(c) Short term provisions (provision for tax) 10,000

Total 22,40,000
B. Assets

1) Non-Current Assets
(a) Fixed assets
(i) Tangible assets (Land) 10,00,000
(ii) Intangible assets (Immovable properties) 10,00,000
(2) Current Assets
(a) Inventories (Loose Tools) 10,000
(b) Trade receivables (Bills Receivable) 2,30,000

Total 22,40,000

9. Balance Sheet (Extract only)

Particulars Note Figures as at Figures as at

No. the end of the end of
current previous
reporting reporting
period period

A. EQUITY AND LIABILITIES

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(1) Shareholders’ Funds
(a) Share capital 5,00,000
(b) Reserves and surplus 1 65,000

(2) Share application money pending

Allotment

(3) Non – current liabilities

(a) Long term borrowings (15% Debentures) 3,00,000

(4) Current liabilities

(a) Trade payables (creditors) 1,00,000
(c) Other current liabilities (outstanding salary) 10,000

9,75,000
Total

B. Assets

1) Non-Current Assets
(a) Fixed assets
(i) Tangible assets (Plant & Machinery) 6,00,000
(b) Non-current investments (IFCI Bonds) 2,00,000
(2) Current Assets
(a) Inventories (Raw materials) 1,75,000

Total 9,75,000

Notes to Accounts:

1. Reserves and Surplus

Sinking Fund 1,00,000
Statement of P/L (Loss) (10,000)
Less : Discount on issue of 15% Debentures (25,000) 65,000

10. Balance Sheet (Extract only)

Particulars Note Figures as at Figures as at

No. the end of the end of
current previous
reporting reporting
period period

A. EQUITY AND LIABILITIES

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(1) Shareholders’ Funds
(a) Share capital 4,00,000
(b) Reserves and surplus 1 1,80,000
(c) Money received against share Warrants ---

(2) Share application money pending Allotment --

(3) Non – current liabilities

(a) Long term borrowings 2 2,20,000
(b) Deferred tax liabilities (net) --
(c) Other long term liabilities --
(d) Long term provisions --
(4) Current liabilities
(a) Short term borrowings --
(b) Trade payables (Creditors) 35,500
(c) Other current liabilities (Interest) 6,750
(d) Short term provisions (Proposed Dividend) 24,000

Notes to Accounts
1. Reserves and Surplus
Securities Premium Reserve 1,20,000
Statement of Profit and Loss (Profit) 60,000 1,80,000

2. Long Term Borrowings

9% Debentures 1,50,000
Bank Loan 70,000 2,20,000

11. Balance Sheet (Extract only)

Particulars Note Figures as at Figures as at

No. the end of the end of
current previous
reporting reporting
period period

A. EQUITY AND LIABILITIES

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(1) Shareholders’ Funds
(a) Share capital 8,00,000
(b) Reserves and surplus 1 80,000

(2) Share application money pending

Allotment

(3) Non – current liabilities

(a) Long term borrowings (15% Debentures) 4,00,000
(4) Current liabilities
(a) Trade payables (Creditors) 1,00,000
(b) Short term provisions (Proposed Dividend) 70,000
14,50,000
Total

B. Assets

1) Non-Current Assets
(a) Fixed assets
(i) Tangible assets (Building) 10,00,000
(b) Non-current investments (Govt. Bonds) 2,00,000
(2) Current Assets
(a) Inventories (Stock) 2,50,000
14,50,000
Total

Notes to Accounts
1. Reserves and Surplus
General Reserve 2,00,000
Statement of P/L (Loss) (30,000)
Less : Loss on Issue of Debentures (90,000) 80,000

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