Financial Reporting - December 2021

Ltd. borrowed: ₹95 lakh as loan from XYZ Bank on 1* April, 2018 at an interest rate of 10% p.a. KUPA Ltd. spent % 1,80,912 as loan processing charges. Principal amount of loan is to be repaid in 5 equal instalments and the interest to be paid annually on accrual basis. Effective interest rate on loan is 10.8%. On 318! March, 2020, KUPA Ltd. faced challenges in business because of sudden change in the technology. It approached XYZ Bank and…

Limited and Moon Limited amalgamated from 1% April, 2021. A new company Sunmoon Limited with shares of % 10 each was formed to take over the businesses of the existing companies. Summarised Balance Sheet as on 31s March, 2021 Particulars Note No. | Sun Limited | Moon Limited (2) (9 ASSETS Non-current assets Property, plant and equipment 1,70,00,000 1,50,00,000 Financial assets Investment 21,00,000 11,00,000 Current assets Inventory 25,00,000 55,00,000 Financial assets Trade receivables 36,00,000 80,00,000 Cash and cash equivalent 9,00,000…

(a) Hari Ltd. purchased an equipment for 10,200 CAD from Canada supplier on credit basis on 318 January, 2020. Hari Ltd.'s functional currency is INR. The fair value of the equipment determined on 31s! March, 2020 is 12,100 CAD. The payment to overseas supplier done on 31% March 2021 and the fair value of the equipment remains unchanged for the year ended on 31° March, 2021. The exchange rates are as follow: ¢ — On the date of transaction …

(a) e Jakob Ltd. entered into a contract for lease of machinery with Jason Ltd. on 1.1.2018. The initial term of the lease is 6 years with a renewal option of further 2 years. ¢ The annual payments for initial term and renewal term are @ 2,80,000 and 7 3,50,000 respectively. PAPER - 1 : FINANCIAL REPORTING 17 ¢ The annual lease payment will increase based on the annual increase in the CPI at the end of the preceding year.…

(a) Ram Limited is a company incorporated In India. It provides % 25,00,000 interest free loan to its wholly owned Indian subsidiary Balram Limited. There are no transaction costs. How should the loan be accounted for, in the light of provisions of related Ind AS, in the books of Ram Limited, Balram Limited and Consolidated Financial Statements of the group, considering the following scenarios: (i) The loan is repayable on demand. (ii) The loan is repayable after 3 years. The…

(a) PQR Limited acquired a building for its administrative purposes and presented the same as Property, Plant and Equipment (PPE) in the financial year 2019-2020. During the financial year 2020-2021, it relocated the office to a new building and leased the said building to a third party. Following the change in the usage of the building, PQR Limited reclassified it from PPE to Investment Property in the Financial Year 2020-2021. Should PQR Limited account for the change as a change…