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Accountancy - II - Assignment 2015-16

Bachelor’s Degree Programme
(BDP)
TUTOR MARKED ASSIGNMENT
Course Code: ECO - 14
Course Title: Accountancy - II
Assignment Code: ECO – 14/TMA/2015-16
Coverage: All Blocks
Maximum Marks: 100

Attempt all the questions.

1. (a) Give specimen of company’s balance sheet as per part I of schedule VI of Indian Companies Act, 1956.
  (b) Differentiate between Profit & Loss Account and Profit & Loss Appropriation Account. (10×2)
2. X Ltd. sends goods to its Karnal branch at cost plus 25%. All expenses are paid by H.O. From the following particulars you are required to show Branch Debtors Account, Branch Stock Account, Stock Adjustment Account and Branch Profit & Loss Account in the books of Head Office:
Particulars
Amount (Rs.)
Opening Stock                                          36,000
Closing Stock                                           42,000
Opening Debtors                                      27,500
Closing Debtors                                        41,100
Goods Supplied to Branch                        1,94,000
Cash received from Customers                 98,800
Bad Debts                                                  6,000
Discount                                                    1,600
Expenses                                                    5,200
Cash Sales                                                 58,400
Goods returned by Branch                         8,000
Branch’s Furniture (Provide 20% Depreciation)   10,000                                         (20)


3. M/s Raj and Bros. purchased a motor car from Sanjaya Automobiles on 1st Jan. 2012 on the hire-purchase system. The cash price of the motor car was Rs. 11,170. Rs. 3,000 was to be paid on signing the agreement and the balance in the three annual installments of Rs. 3,000 each. Interest @ 5% p.a. is charged by the vendor. The purchaser had decided to write off 10% depreciation annually on the written down value method. The purchaser could not pay off the installment due on 31st Dec. 2013 and as a result of this, the vendor took possession of the motor-car and the vendor estimated its value Rs. 5,500 and spent Rs. 400 on it. Later on, this motor-car was sold for Rs. 6,400. Prepare necessary accounts in the books of both the parties.                                                                  (20)

4. Why are assets and liabilities revalued at the time of admission of a new partner? Prepare a Revaluation Account with the help of imaginary figures.                                          (20)

5. Write short notes on the following:
(a) Pro-rata Allotment of Shares
When allocating shares in a company, the pro-rata allotment method is often used. This method is based on the principle of proportionality, meaning that each shareholder receives shares in proportion to the number of shares they already own.

For example, let's say Company XYZ has 100 shares outstanding and you own 10 of those shares. If the company decides to issue 10 more shares, under the pro-rata allotment method, you would be entitled to receive 1 additional share (10% of 10).

There are a few advantages to using the pro-rata allotment method. First, it's a simple and straightforward way to allocate shares. Second, it treats all shareholders equally, in proportion to their existing holdings.


(b) Issue of shares at discount
Shares of stock are generally issued at par, which is the face value of the shares. However, there are times when shares are issued at a discount, which means that the shares are issued for less than their face value. This can happen for a variety of reasons, but it typically happens when a company is trying to raise capital quickly.


(c) Re-issue of forfeited shares


(d) Over subscription of shares                                                                            (4×5)
Over-subscription of shares is when the demand for a company's shares exceeds the number of shares available for sale. This can happen when a company goes public, or when it does a secondary offering.
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