Financial Reporting - November 2016 MTP

(a) Explain whether the following will constitute a change in accounting policy or not as per AS 5. (i) Introduction of a formal retirement gratuity scheme by an employer in place of ad hoc ex-gratia payments to employees on retirement. (ii) Management decided to pay pension to those employees who have retired after completing 5 years of service in the organisation. Such employees will get pension of Rs. 20,000 per month. Earlier there was no such scheme of pension in…

A Ltd acquired 25% of shares in B Ltd. as on 31.3.2015 for Rs. 3,00,000. The Balance Sheet of B Ltd. as on 31.3.2016 is given below: Liabilities Share Capital Reserves and Surplus Total Rs. 5,00,000 5,00,000 10,00,000 Total 5,00,000 2,00,000 3,00,000 10,00,000 Assets Fixed Assets Investment Current Assets During the year-ended 31.3.2016, the following are the additional information available: (a) A Ltd. received dividend from B Ltd. for the year ended 31.3.2015 at 40% from the reserves. (b) B…

Ltd. and CD Ltd. two private companies, decide to amalgamate their business into a new holding company EF Ltd., which was incorporated on 1st August, 2015 with an authorised capital of Rs. 40,00,000 in equity shares of Rs. 10 each. The new company plans to commence operations on 1 st October, 2015. From the information given below, and assuming that all transactions are completed by 31st March, 2016, you are required to: (a) Prepare Projected Statement of Profit & Loss…

(a) On 1.4.2015, a mutual fund scheme had 18 lakh units of face value of Rs.10 each outstanding. The scheme earned Rs.162 lakhs in 2015-16, out of which Rs.90 lakhs was earned in the first half of the year. On 30.9.2015, Rs.2 lakh units were sold at a NAV of Rs.70. Pass Journal entries for sale of units and distribution of dividend at the end of 2015-16. (8 Marks) (b) From the following information of Prahlad Ltd., compute the economic…

(a) As point of staff welfare measures, Y Co. Ltd. has contracted to lend to its employees sums of money at 5 percent per annum rate of interest. The amounts lent are to be repaid alongwith the interest in five equal annual instalments. The market rate of interest is 10 per cent per annum. Y lent Rs. 16,00,000 to its employees on 1st January, 2016. Following the principles of recognition and measurement as laid down in Ind AS 109, you…

Sheets of X Ltd. are as follows: Liabilities Share Capital General Reserve Profit and Loss Account Term Loans Sundry Creditors Provision for Tax Proposed Dividend Assets Fixed Assets and Investments (Non-trade) Stock Debtors Cash and Bank As at 31.3.2015 1,000.0 800.0 120.0 370.0 70.0 22.5 200.0 2,582.5 (Rs. in lakhs) As at 31.3.2016 1,000.0 850.0 175.0 330.0 90.0 25.0 250.0 2,720.0 1,600.0 550.0 340.0 92.5 2,582.5 1,800.0 600.0 220.0 100.0 2,720.0 Other Information: