Professional Documents
Culture Documents
Pakistan
SEMESTER-3
Maximum Marks: 80
Roll No.:
Marks
Q. 2
Following trial balance relates to ABC & Company (Pvt.) Limited as on December 31, 2013:
Debit
Rs. 000
Sales
Purchase
Administration expenses
Selling and distribution expenses
Interest paid
Dividend paid
Retained earnings at start
Land
Building
Accumulated depreciation-Building
Plant
Accumulated depreciation-Plant
Investment property
Inventory at start
Advance, deposits and prepayments
Trade receivables
Trade payables
Bank
5% Loan note
Equity shares capital (@ Rs.10 each)
Deferred tax
Credit
Rs. 000
15,700
9,140
1,400
190
25
80
3,535
1,000
4,000
800
5,300
2,900
3,000
2,800
1,440
4,100
3,900
1,060
33,535
500
5,600
600
33,535
(i)
Inventory at December 31, 2013 is Rs. 3,390,000. This includes damaged goods that
had a cost of Rs. 550,000. These would require remedial work costing Rs. 200,000
before these could be sold for an estimated price of Rs. 450,000.
(ii) Sale proceeds of an item of plant that was sold in October 2013 for Rs. 300,000 is
included in revenue. Cost of the plant is Rs.1,000,000 and it had been depreciated by
Rs. 400,000 at the date of its sale. No other accounting entries for the disposal of the
plant have been made, other than recording the proceeds in sales and cash.
Reducing balance method is used for depreciation of all plant @ 25% per annum.
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(iii) On January 1, 2013, the land was valued at Rs. 1200,000. The directors wish this
value to be incorporated into the financial statements. The company charges 2%
depreciation on cost of building using straight-line method. Depreciation on plant and
building are to be included in cost of goods sold.
(iv) The company adopts the fair value model for its investment property. Its value at
December 31, 2013 has been assessed by a qualified surveyor at Rs. 2,000,000.
(v) The directors have estimated the provision for income tax for the year ended
December 31, 2013 at Rs. 150,000. The deferred tax liability at December 31, 2013 is
Rs.560,000.
(vi) Depreciation for the year to December 31, 2013 has not yet been accounted for in the
draft financial statements.
Required:
Prepare the following financial statements for the year to December 31, 2013:
(a) Statement of Profit or Loss
(b)
Q. 3
10
ASSETS
Non-Current Assets
Property, plant and equipment
Software
Current Assets
Inventory
Trade receivables
Investment in government securities
Due from construction contract
Cash and bank balances
TOTAL ASSETS
EQUITY AND LIABILITIES
Equity
Ordinary shares @ Re.1 each
Shares premium
General reserves
Retained earnings
Non-current Liabilities
9% Loan notes (redeemable)
Deferred tax
Government grants
Current Liabilities
Trade payables
Provision for taxation
Government grants
TOTAL EQUITY AND LIABILITIES
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850
35
885
630
0
630
54
30
30
80
608
802
1687
41
66
180
55
392
734
1364
500
150
120
66
836
300
85
100
40
525
60
12
525
597
100
172
200
472
71
83
100
254
1687
29
213
125
367
1364
Marks
Notes:
(i)
The company paid a dividend of Rs. 25 million for the year ended June 30, 2013.
The software was purchased on January 1, 2013 for Rs. 40 million.
Issued equity bonus shares of one for every four held. Share premium reserve is
used for this issue on January 1, 2013. There was also cash share issued on
March 1, 2013.
(v) Total tax charge (including deferred tax) in the statement of profit or loss for the
year to June 30, 2013 was Rs. 31 million.
(vi) Government securities were sold during the year at a profit of Rs.27 million. This
profit was credited to the statement of profit or loss. During the year, no further
government securities were purchased or sold.
(vii) Rs. 40 million of loan notes were redeemed at par on December 31, 2012. Interest
on the loan notes is paid each year on June 30, and December 31.
(viii) Rs. 20 million was transferred to general reserves.
Required:
Prepare Statement of Cash Flows for the year ended June 30, 2013 using indirect
method in accordance with IAS-7.
Q. 4
(a)
(b)
The Conceptual Framework of IASB provides a list of the purposes of the Framework.
One of the purposes of the Framework is to assist users of financial statements in
interpreting the information contained in financial statements prepared in compliance
with IFRSs. List down the users of the financial statements.
20
05
Required:
(i)
05
(ii)
05
Required:
What amounts will be shown in the statement of financial position and statement of profit
or loss for the year to December 31, 2013?
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Q. 5
(a)
Khan & Company acquired the whole business (for a purchase consideration of Rs. 5.2
million) on January 1, 2013 from Afridi Transport, a company that operates CNG
Rickshaws in Karachi. Statement of financial position (at fair value) of Afridi Transport
on the date of acquisition show the following:
Rupees
Goodwill
500,000
Operating license
1,500,000
Parking complex and office
600,000
Workshop
600,000
20 CNG Rickshaws
2,000,000
Required:
Work out the carrying value of the assets of Afridi Transport after recognizing the
impairment losses at:
(i) March 1, 2013.
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The following information has been obtained from the books of Omer Enterprises:
Mobile
Batteries
Rs. 000
25,000
220,000
15,000
Mobile
Chargers
Rs. 000
20,000
100,000
13,000
Additional Information:
(i) For sale of mobile batteries, Omer Enterprises worked as an agent of Usman & Co.
Mobile batteries are sold at a gross profit margin of 46%. Omer Enterprises receive
a commission of 10% of the sales price.
(ii) Mobile chargers are purchased by Omer Enterprises from Usman & Co., and are
sold at a gross profit margin of 25%.
Required:
Prepare an extract of statement of profit or loss of Omer Enterprises for the year ended
December 31, 2013 showing the revenue, cost of sales and gross profit.
THE END
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