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B.COM. DEGREE END SEMESTER EXAMINATION MARCH 2OL8

SEMESTER - 4: COMMERCE (coRE coURsE)
COURSE: U4CRCOM11: CORPORATE ACCOUNTING
(For Supplementory - 2074 Admission)
Time:Three Hours Max. Marks: 75
PART A

Answer oll questions. Each question carries I mark

1. What is profit prior to incorporation?
2. Who is a contributory according to Companies Act, 1956?
3. What is a bonus share?
4. What is net worth?
5. What is unmarked application?
6. What is Capital Redemption Reserve?
7. What is deficiency account?
8. What is contingent liability?
9. What do you mean by Firm Underwriting
10. What is Time Ratio? (1x 10 = 10)

PART B

Answer ony eight questions. Each question carries 2 marks

11. What is Vertical Balance Sheet?
12. X Ltd acquires the business of Y Ltd for which X Ltd pays 10,00,000 in equity shares of Rs.10/-
each, Rs.7,0O,OOO in L5% debentures of X Ltd and Rs.4,50,000 in cash. Creditors for
Rs.1,50,000 and employees security deposit of Rs.30,000 are also assumed by X Ltd.
Calculate purchase consideration.
1-3. XYZ Ltd. has 50,000 equity shares of Rs.10 each, Rs.8 paid up. lt is resolved to make the
shares fully paid up by bonus issue. The company has General Reserve Rs.2,00,000. Give
journal entries.
14. Explain the treatment of profit prior to incorporation?
15. Who are dissenting shareholders? How their claims are settled?
16. What are the profits available for buyback of shares?
1-7. Differentiate between internal reconstruction and external reconstruction?
18. What is 'Liquidator's Final Statement of Account'?
19. Who are preferential creditors?
20. What do you'mean by interim dividend and final dividend? (2 x 8 = 16)

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PART C

Answer ony five questions. Each question carries 5 marks

21. What are the different methods of calculating Purchase Consideration?
22. Differentiate between capital alteration and capital reduction
23. Differentiate Amalgamation from External Reconstruction'
P&L A/c from the year ended 31-03-
24. A company carried forward balance of Rs.40,000 f rom
before providing
2013. During the year 2O13-L4 it made a further profit of Rs.3,10,000/-
out :
taxation. lt was decided that the following decisions were carried
Provision for taxation Rs.1,50,000
Dividend equalization Reserve Rs' 25,000
Dividend on 8% Preference Shares of Rs'2,00,000
paid up
Dividend at til%on 30,000 equity shares of Rs.10/- each fully
General Reserve Rs'35,000
Development Rebate Reserve Rs'35,000
Prepare P&L Appropriation Account and journal entries for the above
5o,ooo shares were bought back
25. Lal Ltd. issued 2,oo,ooo equity shares of Rs.10 each, of which
Rs.110 each' The com
per share. The company issued 4,ooo, 6% preference shares of Rs'100 at
general reserve' Give jot
had Rs.2,00,000 in security premium account and Rs'2,40,000 in
entries.
paid-up. Resolution is passed to declare b
26. AB Ltd. has 3o,ooo equity shares of Rs.10 each, Rs.7
to make the shares fully paid-up and to issue bonus shares in the ratlo 1:3
The compan'
books of the company'
surf,cient amount of genenal reserye. Give journal entries in the
joint stock company under the name of "A
27. Aril and Sunil \.,'orking in partnership, registered a
S,;:r l Ltd." On l,,Septennber, 2OO6 to take the business
with effect from 1't April, 2006'
Profit and Loss Account for the year ending 31-3-2007
Pc1,'culors Rs. Po rticu lo rs Rs.

Salaries and wages 5000 Gross profit b/d 42000

Debenture interest 2500

Depreciation 1000

lnterest on purchase consideration

(U p to 30- 9-7006) 5400

Director's fees 400

Preliminary exp. Written off 500

Selling commission 6000

Provision for taxes 2500

Dividend on equitY shares at 5qt 3000

N et prof it 15700

42,000 47,000

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GOODWILL TUITION CENTRE, THEVARA 9567902805, 9846710963

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Salesfor the year totaled Rs. 112500, out of which Rs. 75000 related to the period from 1't
September,2006 to 31't March 2OO7. You are required to prepare a statement apportioning the
profits between post and pre incorporation period indicating your basis of allocation.
(5x5=25)
PART D
Answer ony two of the following questions. Each question carries 12 marks
28. Explain briefly the procedure for implementing capital reduction
29. From the following trial balance and the adjoining information prepare the final accounts
of JOHRI Co. Ltd as on 31 March 2015
DEBIT CREDIT
P re m ises I 30, 7 2,000 Sha re ca pita I 40,00,000
Pla nt { 33,00.000 12% Debentures.Y 30,00,000
Stock P&L Account 2,62,500
Debto rs; 8,70,000 i Bills Payable 3,70,000
Goodwill 2,50,000 rCreditors 4,00,000
Cash ln Bank 4,06,500 Sales 41,,50,000
Ca lls arrear 75,000 General Reserve 2,50,000
lnterim Dividend Paid 3,92,500 Bac oeots provisions on
Pu rchases L8,50,000 L-O4-20L4 35,000
Preli minary expenses \,/ 50,000
Wages 9,79,900
Genera I Expenses 68,350
Sa la ries 2,02,250
Ba d debts 2L,100
Debentu re lnterest Paid .r L,80,000
Total I
t,24,67,500 Tota I L,24,67,500

a. Depreciate Plant by 15%

b. Write off Rs.5000 from Preliminary Expenses
c. Half years Debenture lnterest Due
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d. Credit 5% Provision on Debtors for douotful debts +'f
e. Provide for Income Tax at 50% *i1r,.r>,"
f. Stock on 31-3 -2015 was Rs.9,50,000
g. A claim of Rs.25,000 for Workmens Compensation is being disputed by the Co.
30. Prepare the Balance Sheet of a Company in vertical form with imaginary figures.

GOODWILL TUITION CENTRE, THEVARA 9567902805, 9846710963

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31. Following was the Balance sheet of Minerva Ltd., as on 31st March 2oL5.
Lia bilities Amount Assets Amou nt
(Rs.) (Rs.)

4,000 equity shares of Rs.100 4,00,000 Goodwill 50,000

each

2,000 7% Preference Shares 2,00,000 Land and Building L,40,000

of Rs.100 each

6% Debentures 2,00,000 Plant and Machinery 1,50,000

Sundry Creditors 2,00,000 Pate nts 40,000
Stock L,60,000

I o.btors I z, 1 5,000 i

Cash in hand ' 5,000

Preliminary expenses 25,000
Discount on issue of 15,000
De be ntu res

Profit and Loss account 2,00,000

Total LO,00,ti00 Tota I L0,00,000
The following scheme of reconstruction was duly accepted and implemented.
a. Equity shares are to be reduced to equal number of fully paid shares of Rs.50 each
b. 7Yo Pref erence Shares are to be reduced bV 30% and the rate of dividend is to be
increased to 97o

c. The value of Land and Building is to be increased by L0%

d. The Debentures are to be reducedbV 20%
e. All nominal and fictitious assets are to be eliminated and the balance is to be used
to write off patents
f. Further equity shares are tu be issued for Rs.50,000 for cash
Give necessary journal entries and prepare the Balance sheet afterthe reconstruction is
implemented
(I2x2=24)

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