QP. Code : 36194 Time : 3 hours Marks: 100 1. All questions are compulsory 2. Q. no. 1 & Q.6 carries 20 marks. 3. Q.2, 3,4 &5 carries 15 marks 4, Use of simple calculator is allowed. Q.1 A) MULTIPLE CHOICE QUESTIONS. (any 10) 10 1. RBlisa a) Statutory company _b) Registered company c) Listed company _d) Chartered company 2. Discounted bill of exchange is a a) Contingent Liability b) Current liability c) Non-Current Liability d) Fixed Liability 3. Partly paid shares can be made fully paid by capitalizing. ? a) General reserve ¢) Securities Premium b) Capital Redemption Reserve d) All of the above 4. Bonus shares cannot be issued by capitalizing a) Revaluation reserve __c) Capital Reserve b) Securities premium d) General Reserve 5. Discount on issue of Debentures isa a) Capital loss c) Revenue loss b) Capital profit d) Revenue profit 6. The Companies Act 2013 a) Prescribes restrictions on issue of debentures at discount b) Does not prescribe any restrictions on issue of debentures at discount ¢)_ Provides no issue of debentures at discount d) All of the above 7. The reserve which cannot be transferred to Capital Redemption Reserve__ a) Securities premium A/c _c) Revaluation Reserve b) Profit prior to incorporation d) All of the above 8. Acompany can issue___. a) Only redeemable preference shares c) Only Deferred shares b) Only irredeemable preference shares d) All of the above 9, Debentures may be redeemed out of. a) Capital b) Profit ¢). Conversion into shares d) All of the above 10. Capital Reserve is, a) Current year’s profit b) Past accumulated profits ©) Capital profit d) Divisible profit EEAE2M9ABCBEARED Eb SoBa3212C51FQP. Code : 36194 11. For computation of pre-incorporation profit carriage on purchases is___. a) Allocated in sales ratio b) Allocated in purchase ratio c) Debited to pre-incorporation period d) Debited to post-incorporation period 12. For computation of pre-incorporation profit travelling expenses are allocated in a) Pre-incorporation period b) post incorporation period ¢) Insales ratio d) In time ratio Q.1.B) TRUE OR FALSE (any 10) 10 1. Loose tools are shown under current liabilities, Short term loan is the loan due for more than 5 years. Calls in arrears is added to subscribed capital. The document inviting offer from public for subscription is share certificate Rate of underwriting commission in case of debentures cannot exceed 10%. Issue of debentures must be sanctioned by state government. Capital redemption reserve is used for payment of dividend Capital reserve is a divisible profit. CErINauAWN Preference shareholders have voting rights. 10. Preference shares may be convertible into equity shares. 11. For computation of pre-incorporation profit advertisement expenses are allocated in time ratio. 12. Profit prior to incorporation is available for payment of dividend. Q.2_ The Balance Sheet of Straight Ltd. As on 31 March, 2017 was as under: Liabilities z Assets z Share Capital: Fixed Assets 15,00,000 25,000 Equity Shares of § 100 Investment 10,00,000 each fully paid 25,00,000 | (M.V. € 10,10,000) 10,000 9% Redeemable Bank Balance 50,000 Preference shares of € 100 each Other current assets 20,20,000 % 90 per share paid up 9,00,000 General Reserve 3,00,000 Profit & Loss A/c 3,19,000 Dividend Equalization Reserve | 2,00,000 Sundry Creditors 3,51,000 : 45,70,000 45,70,000 On 1* April, 2017; the company made a call of € 10 each on its preference shares and call money was duly received. All preference shares were redeemed at a premium of 2%, The company sold all its investment at market value. For the purpose of redemption, the company issued minimum number of equity shares at a premium of EEAE2MVABCBIARED YbS2Ba3212C51FQP. Code : 36194 10% after utilising available resources to the maximum extent, keeping in view the provisions of the Companies Act, 2013. All preference shareholders were paid off, except one shareholder holding 150 preference shares. Pass Journal Entries in the books of the company assuming that redemption is duly carried out. oR Q. 2 Following is the Balance sheet of Moonlight Ltd. as on 31 March, 2017. Liabilities fe Assets z 2,000 — 8% Redeemable Fixed Assets % 15,75,000 Preference shares of = 100 Bank 2,18,000 each, fully paid 2,00,000 | Investments 1,00,000 Equity Shares of & 10 (Market value & 1,90,000) 1,50,000 each, fully paid | 10,00,000 Securities Premium | 35,000 Profit & Loss Account | 4,50,000 Sundry Creditors 2,58,000 19,43,000 ‘On the above date the Directors of the company took following steps to redeem 8%. Preference shares at a premium of 5%: a) The company issued 4,000 Equity shares of & 10, at a premium of % 2 per share for the purpose of redemption of preference shares. b) Investment were sold at market price. c) All the payments were made to the preference shareholders except those holding 100 shares who could not be traced. You are required to pass necessary journal entries in the books of Moonlight Ltd. Complying with requirements of Companies Act 2013, Q.3 Roshan Ltd. gave notice of its intention to redeem its outstanding & 4, 00,000, 8% debenture at %.105 (nominal value % 100) and offered the following options to the holders: a) 11% preference share of € 40/- each at & 50 per share. b) 10% debenture at & 100 (at par) ¢). To have their holdings redeemed for cash. Assume redemption out profit only. 1) The holders of € 1, 40,000 debenture accepted option (a). 2) The holders of € 1, 60,000 debentures accepted option (b).. 3) The remaining debenture holders accepted option (c). Pass the necessary journal entries in the books of Roshan Ltd. EEAE2M9ABCBIARED MY bS2Ba3212C51F