Acharya N G Ranga Agricultural University 2006 Diploma Financial Management Financial Accounting - Question Paper
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5% Debentures of Rs. 100 every 3,00,000 Stock 1,50,000
Debenture Interest Due 50,000 Sundry Debtors 75,000
Current Liabilities Bank 1,00,000
& Provisions : Cash 25,000
Sundry Creditors 1,80,000 Miscellaneous Expenditure
Discount on Debentures 30,000
Profit & Loss Account 5,00,000
Patents & Trade Marks 40,000
16,80,000 16,80,000
*
* Note: Preference dividend is in arrears for 3 years.
* The subsequent scheme of reconstruction was prepared and duly approved by the court.
1. The Preference Shares shall be converted into equal Number of 9% Preference Shares of Rs. 50 every.
2. The equity shares shall be decreased to Rs. three every. However the face value will remain the identical.
3. 5% Debentures shall be converted into equal number of 6% Debenture, of Rs. 75 every. The debenture holders also agreed to waive 50% of the accrued interest.
4. Arrears of preference dividend are to be decreased to 1 year's dividend which is paid in cash.
5. The Sundry creditors agreed to waive 30% of their claims and to accept Equity shares for Rs. 30.000 in part settlement of their renewed claims.
6. The assets are to be revalued as under :
Building Rs. 3.50,000
Plant & Machinery Rs. 2, 50,000
Furniture Rs. 80,000
Stock Rs. 1, 00,000
Sundry Debtors Rs.70,000
7. Intangible assets and fictitious assets to be written off.
* Pass journal entries, prepare Capital Reduction Account and Balance Sheets after reconstruction in the books for Paramount Ltd.
* Q.3 subsequent Trial Balance is extracted from the books of Shrikrishna (Pvt.) Ltd. as on 31-03-2005. The 16 company was Incorporated on 1-08-2004 to take over the business of a proprietary concern from 1-4-2004. The authorised share capital was 50,000 Equity shares of Rs. 10 every. The Purchase consideration was settled on 1-10-2004, being Rs. 1, 25,000. It was in the form of 10,000 shares of Rs. 10 every and the balance in the form of debentures of Rs. 100 every. :— 16
*
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Trial Balance as on 31st March, 2006
Particular Debit Rs. Particular Credit Rs.
Opening Stock 23,600 Sales 2,14,000
Purchases 75,800 Sundry Creditors 40,200
Earning: Approval pending. |