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Question
Prepare a Cash Flow Statement on the basis of the information given in the Balance Sheet of Libra Ltd. as at 31.3.2013 and 31.3.2012.
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|
Particulars |
Note No. |
31.3.2013 Rs |
31.3.2012 Rs |
|
I |
Equity and Liabilities : |
|
|
|
|
1. |
Shareholder’s Funds : |
|
|
|
|
|
(a) Share Capital |
|
8,00,000 |
6,00,000 |
|
|
(b) Reserve and Surplus |
|
4,00,000 |
3,00,000 |
|
2. |
Non-Current Liabilities : |
|
|
|
|
|
Long Term Borrowings |
|
1,00,000 |
1,50,000 |
|
3. |
Current Liabilities : |
|
|
|
|
|
Trade Payables |
|
40,000 |
48,000 |
|
|
Total |
|
13,40,000 |
10,98,000 |
|
|
|
|
|
|
|
II |
Assets |
|
|
|
|
1. |
Non-Current Assets : |
|
|
|
|
|
(a) Fixed Assets : |
|
|
|
|
|
(i) Tangible Assets |
|
8,50,000 |
5,60,000 |
|
|
(b) Non-Current Investment |
|
2,32,000 |
1,60,000 |
|
2. |
Current Assets : |
|
|
|
|
|
(a) Current Investments (Marketable) |
|
50,000 |
1,34,000 |
|
|
(b) Inventories |
|
76,000 |
82,000 |
|
|
(c) Trade Receivables |
|
38,000 |
92,000 |
|
|
(d) Cash and Cash Equivalents |
|
94,000 |
70,000 |
|
|
Total |
|
13,40,000 |
10,98,000 |
|
|
Solution
|
Cash Flow Statement for the year ended March 31, 2013 |
||||
|
|
Particulars |
Amount (Rs) |
Amount (Rs) |
|
|
A |
Cash Flow from Operating Activities |
|
|
|
|
|
Profit as per Statement of Profit and Loss |
1,00,000 |
|
|
|
|
Profit Before Taxation |
|
1,00,000 |
|
|
|
Operating Profit before Working Capital Adjustments |
|
1,00,000 |
|
|
|
Add: Decrease in Current Assets |
|
|
|
|
|
|
Trade Receivables |
54,000 |
|
|
|
|
Inventories |
6,000 |
60,000 |
|
|
Less: Decrease in Current Liabilities |
|
|
|
|
|
Trade Payables |
(8,000) |
(8,000) |
|
|
|
Net Cash Flows from Operating Activities |
|
1,52,000 |
|
|
|
|
|
|
|
|
B |
Cash Flow from Investing Activities |
|
|
|
|
|
|
Purchase of Fixed Assets |
(2,90,000) |
|
|
|
|
Purchase of Investments |
(72,000) |
(3,62,000) |
|
|
Net Cash Used in Investing Activities |
|
|
|
|
C |
Cash Flow from Financing Activities |
|
|
|
|
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Proceeds from Issue of Share Capital |
2,00,000 |
|
|
|
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Repayment of Long-term Loan |
(50,000) |
|
|
|
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Net Cash Flow from Financing Activities |
|
1,50,000 |
|
|
|
|
|
|
|
|
D |
Net Increase or Decrease in Cash and Cash Equivalents |
|
(60,000) |
|
|
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Add: Cash and Cash Equivalent in the beginning of the period |
|
2,04,000 |
|
|
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Cash and Cash Equivalents at the end of the period |
|
1,44,000 |
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|
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APPEARS IN
RELATED QUESTIONS
X, Y and Z were partners in a firm sharing profit’s in the firm of 5:3:2. On 31-3-2015 their Balance Sheet was as follows:
Balance sheet of X,Y and Z as on 31st march,2015
| Liabilities | Amount(Rs.) | Assets | Amount(Rs.) |
|
Creditors Investment Fluctuation Fund P & L Account Capital: X 50,000 Y 40,000 Z 20,000
|
21,000 10,000 40,000
1,10,000
|
Land and Building Motor Vans Investments Machinery Stock Debtors 40,000 Less: 3,000 Cash |
62,000 20,000 19,000 12,000 15,000
37,000 16,000 |
| 1,81,000 | 1,81,000 |
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(2) There was a claim of 4,000 for Workmen’s Compensation.
(3) Provision for bad debts was to be reduced by 1,000
(4) Y will be paid 8,200 in cash and the balance will be transferred in his loan account which will be paid in four equally yearly instalments together with interest @ 10% p.a.
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Prepare Revaluation Account. Partner’s Capital Accounts and the Balance Sheet of reconstituted firm.
R, S and T were partners in a firm sharing profit in the ratio of 1:2:3. On 31-3-2015 their Balance sheet was as follows :
Balance Sheet of A,B and C as on 31-3-2015
| Liabilities | Amount (Rs.) | Assets | Amount (Rs.) |
|
Creditors Bills Payable General Reserve Capitals R 1,00,000 S 50,000 T 25,000 |
50,000 20,000 30,000
1,75,000 |
Land Building Plant Stock Debtors Bank
|
50,000 50,000 1,00,000 40,000 30,000 5,000
|
| 2,75,000 | 2,75,000 |
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(c) Creditors of Rs.6,000 were not likely to be claimed and hence should be written off
Prepare Revaluations Account, Partner’s Capital Accounts and Balance Sheet of the reconstitute firm.
J, H and K were partners in a firm sharing profits in the ratio of 5:3:2. On 31-3-2015 their Balance Sheet was as follows:
Balance Sheet of J,H and K as on 31-3-2015
| LIabilities | Amount(Rs.) | Assets | Amount(Rs.) |
|
Creditors Investment Fluctuation Fund P & L Account Capital: J 1,00,000 H 80,000 K 40,000
|
42,000 20,000 80,000
2,20,000
|
Land and Building Motor Vans Investments Machinery Stock Debtors 80,000 Less: 6,000 Cash |
2,24,000 40,000 38,000 24,000 30,000
74,000 32,000 |
| 3,62,000 | 3,62,000 |
On the above data H retires and J and K agreed to continue the business on the following terms:
(i) Goodwill of the firm was valued at Rs.1,02,000.
(ii) There was a claim of Rs.8,000 for workmen's compensation.
(iii) Provision for bad debts was to be reduced by Rs.2,000.
(iv) H will be paid Rs.14,000 in cash and the balance will be transferred in his loan account which will be paid in four equal yearly installments together with interest @ 10% p.a.
(v) The new profit sharing ratio between J and K will be 3:2 and their capitals will be in their new profit sharing ratio. The capital adjustments will be done by opening current accounts.
Prepare Revaluation Account, Partner’s Capital Accounts and Balance Sheet of the new firm.
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Balance Sheet of Kushal, Kumar and Kavita as on 1st April 2012
| Liabilities | Amount (Rs.) | Assets | Amount (Rs.) |
|
Creditors Bill payable General Reserve Capital: Kushi 3,00,000 Kumar 2,80,000 Kavita 3,00,000 |
1,20,000 1,80,000 1,20,000
8,80,000 |
Cash Debtors 2,00,000 Less: Provision 10,000 Stock Furniture Building Land |
70,000
1,90,000 2,20,000 1,20,000 3,00,000 4,00,000 |
| 13,00,000 | 13,00,000 |
On the above date, Kavita retired and the following was agreed:
i. Goodwill of the firm was valued at Rs.40,000.
ii. The land was to be appreciated by 30% and the building was to be depreciated by Rs.1,00,000.
iii. Value of furniture was to be reduced by Rs.20,000.
iv. Bad debts reserve is to be increased to Rs.15,000.
v. 10% of the amount payable to Kavita was paid in cash and the balance was transferred to her Loan Account.
vi. Capitals of Kushal and Kumar will be in proportion to their new profit sharing ratio. The surplus/deficit, if any in their Capital Accounts will be adjusted through Current Accounts.
Prepare Revaluation Account, Partners Capital Accounts and Balance Sheet of Kushal and Kumar after Kavita's retirement.
Charu and Harsha were partners in a firm sharing profits in the ratio of 3:2. On 1-4-2014 their Balance Sheet was as follows :
| Balance Sheet | |||
| Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Creditors General Reserve Workmen Compensation Fund Investment Fluctuation Fund Provision for bad debts Capitals Charu 30,000 Harsha 20,000 |
17,000 4,000 9,000 11,000 2,000
50,000 |
Cash Debtors Investments Plant Land and building
|
6,000 15,000 20,000 14,000 38,000
|
| 93,000 | 93,000 | ||
On the above date, Vaishali was admitted for 1/4th share in the profits of the firm on the following terms:
(a) Vaishali will bring Rs 20,000 for her capital and Rs 4,000 for her share of goodwill premium.
(b) All debtors were considered good.
(c) The market value of investments was Rs 15,000.
(d) There was a liability of Rs 6,000 for workmen compensation.
(e) Capital accounts of Charu and Marsha are to be adjusted on the basis of Vaishali's capital by
opening current accounts.
Prepare Revaluation Account and Partners' Capital Accounts
Om, Ram and Shanti were partners in a firm sharing profits in the ratio of 3:2:1. On 1st April 2014 their Balance Sheet was as follows:
| Balance Sheet | |||
| Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Capital Accounts Om 3,58,000 Ram 3,00,000 Shanti 2,62,000 General Reserve Creditors Bills payable |
9,20,000 48,000 1,60,000 90,000 |
Land and Building Plant and Machinery Furniture Bills Receivables Sundry Debtors Stock Bank |
3,64,000 2,95,000 2,33,000 38,000 90,000 1,11,000 87,000 |
| 12,18,000 | 12,18,000 | ||
On the above date Hanuman was admitted on the following terms:
1) He will bring Rs 1,00,000 for his capital and will get the 1/10th share in the profits.
2) He will bring necessary cash for his share of goodwill premium. The goodwill of the firm was valued at Rs 3,00,000
3) A liability of Rs 18,000 will be created against bills receivables discount
4) The value of stock and furniture will be reduced by 20%.
]5) The value of land and building will be increased by 10%.
6) Capital accounts of the partners will be adjusted on the basis of Hanuman's capital in their profit sharing ratio by opening current accounts.
Prepare Revaluation Account and Partner's Capital Accounts.
O, R and S were partners in a firm sharing profit in the ratio of 3:2:1 On 1.4.2014 their Balance Sheet was as follows:
| Liabilities |
Amount RS |
Assets |
Amount Rs |
|
Capital Accounts O 1,75,000 R 1,50,000 S 1,25,000 Current Accounts O 4,000 S 6,000 General Reserve Profit and Loss Accounts Creditors Bills Payable |
4,50,000
10,000 15,000 7,000 80,000 45,000 |
R’s Current Accounts Land and Building Plant and Machinery Furniture Investment Bills Receivables Sundry Debtors Stock Bank
|
7,000 1,75,000 67,500 80,000 36,500 17,000 43,500 1,37,000 43,500
|
| 6,07,000 | 6,07,000 |
On the above date, H was admitted on the following terms:
(i) H will bring Rs 50,000 as his capital and will get 116 th share in the profits.
(ii) He will bring necessary cash for his share of goodwill premium. The goodwill of the firm was
valued at Rs 90,000.
(iii) The new profits sharing ratio will be 2:2:1:1.
(iv) A liability of Rs 7,004 will be created against bills receivables discounted.
(v) The value of stock, furniture and investments is reduced by 20% whereas the value of land and building and plant and machinery will be appreciated by 20% and 10% respectively.
(vi) The Capital accounts of the partners will be adjusted on the basis of H's Capital through their
current accounts.
Prepare Revaluation Account and Partner's Current Accounts and Capital Accounts.
Shikhar and Rohit were partners in a firm sharing profit in the ratio 7:3. On 1st April 2013, they admitted Kavi as a new partner for a ¼ share in the profit of the firm. Kavi brought Rs 4,30,000 as his capital and Rs 25,000 for his share of goodwill premium. The Balance Sheet of Shikhar and Rohit as on 1st April 2013 was as follows:
| Balance Sheet of Shikhar and Rohit as on 1st April 2013 | |||
| Liabilities | Rs | Assets | Rs |
|
Capital: Shikhar 8,00,000 Rohit 3,50,000 General Reserve Workman’s Compensation Fund Creditors |
11,50,000 1,00,000 1,00,000 1,50,000 |
Land and Building Machinery Debtors 2,20,000 Less: Provision 20,000 Stock Cash |
3,50,000 4,50,000
2,00,000 3,50,000 1,50,000 |
| 15,00,000 | 15,00,000 | ||
It was agreed that:
1. The value of Land and Building will be appreciated by 20%.
2. The value of Machinery will be depreciated by 10%.
3. The liabilities of Workmen's Compensation Fund was determined at Rs 50,000.
4. Capitals of Shikhar and Rohit will be adjusted on the basis of Kavi's capital and actual cash to be brought in or to be paid off as the case may be.
Prepare Revaluation Account, Partners' Capital Accounts and the Balance Sheet of the new firm.
Sahaj and Nimish are partners in a firm. They share profits and losses in the ratio of 2: 1. Since both of them are specially abled, sometimes they find it difficult to run the business on their own. Gauri, a common friend decides to help them. Therefore, they admitted her into a partnership for a 1/3rd share. She brought her share of goodwill in cash and proportionate capital. At the time of Gauri's admission, the Balance sheet of Sahaj and Nimish was as under:
| Liabilities | Rs | Assets | Rs |
|
Capital Accounts: Sahaj 1,20,000 Nimish 80,000 General Reserve Creditors Employee's Provident Fund |
2,00,000 30,000 30,000 40,000 |
Machinery Furniture Stock Sundry Debtors Cash
|
1,20,000 80,000 50,000 30,000 20,000
|
| 3,00,000 | 3,00,000 |
It was decided to:
a. Reduce the value of a stock by `5,000.
b. Depreciate furniture by 10% and appreciate machinery by 5%.
c. Rs 3,000 of the debtors proved bad. A provision of 5% was to be created on Sundry Debtors for doubtful debts.
d. Goodwill of the firm was valued at Rs 45,000.
Prepare Revaluation Account, Partners' Capital Accounts and Balance Sheet of the reconstituted firm. Identify the value being conveyed in the question.
X, Y and Z were partners in a firm sharing profits in the ratio of 5 : 3 : 2. The firm closes its books on 31st March every year. On 30.9.2016, Z died. The partnership deed provided that on the death of a partner his executors will be entitled to the following :
(i) Balance in his capital account and interest @ 12% per annum. On 1.4.2016 balance in Z's Capital account was Rs 80,000.
(ii) His share in the profits of the firm in the year of his death, which will be calculated on the basis of rate of net profit on sales of the previous year which was 25%. The sales of the firm till 30.9.2016 were Rs 4,00,000.
(iii) His share on the goodwill of the firm. The goodwill of the firm on Z's death was valued at Rs 3,00,000.
The partnership deed also provided that the following deductions will be made from the amount payable to the executor of the deceased partner:
(i) His drawing in the year of his death. Z has withdrawn Rs 30,000 till 30.9.2016.
(ii) Interest on drawing @ 12% per annum which was calculated as Rs 2,000.
The accountant of the firm prepared Z's Capital Account to be presented to his executor but in a hurry did not complete it. Z's Capital Account as prepared by the firm's accountant is presented below :
|
Dr. |
Z’s Capital Account |
Cr. |
|||
|
Date |
Particulars |
Amount (Rs) |
Date |
Particulars |
Amount (Rs) |
|
2016 |
|
|
2016 |
|
|
|
Sep. 30 |
…………… |
30,000 |
April 1 |
…………… |
80,000 |
|
Sep. 30 |
…………… |
2,000 |
Sep. 30 |
…………… |
4,800 |
|
Sep. 30 |
…………… |
……... |
Sep. 30 |
…………… |
20,000 |
|
|
|
|
Sep. 30 |
…………… |
……... |
|
|
|
|
Sep. 30 |
…………… |
……... |
|
|
|
1,64,800 |
|
|
1,64,800 |
|
|
|
|
|
|
|
You are required to complete Z's Capital Account.
P, Q and R were partners in a firm sharing profit in the ratio of 7 : 2: 1. On 1st April, 2013 their Balance Sheet was as follows:
|
Balance Sheet of P, Q and R as on 1st April, 2013 |
|||||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
||
|
Capitals: |
|
Land |
12,00,000 |
||
|
P |
9,00,000 |
|
Building |
9,00,000 |
|
|
Q |
8,40,000 |
|
Furniture |
3,60,000 |
|
|
R |
9,00,000 |
26,40,000 |
Stock |
6,60,000 |
|
|
General Reserve |
3,60,000 |
Debtors |
6,00,000 |
|
|
|
Workmen’s Compensation Fund |
5,40,000 |
Less provision |
–30,000 |
5,70,000 |
|
|
Creditors |
3,60,000 |
Cash |
2,10,000 |
||
|
|
39,00,000 |
|
39,00,000 |
||
|
|
|
|
|||
On the above data Q retired.
The following were agreed:
(i) Goodwill of the firm was valued at Rs 12,00,000.
(ii) Land was to be appreciated by 30% and Building was to depreciated by 3,00,000.
(iii) Value of furniture was to be reduced by Rs 60,000.
(iv) The liabilities for Workmen's Compensation Fund were determined at Rs 1,40,000.
(v) Amount Payable to Q was transferred to his loan account.
(vi) Capitals of P and R were to be adjusted in their new profit sharing ratio, For this purpose current accounts of the partners will be opened.
Prepare Revaluation Account, Partner's Capital Accounts and the Balance Sheet of the new firm.
From the following items of Receipts and Payments A/c of South India Club, prepare an Income and Expenditure Account for the year ended 31.3.2010:
|
Particulars |
Rs |
|
Salaries Paid |
55,000 |
|
Lighting expenses |
5,500 |
|
Stationery (Including Rs 400 for the previous year) |
4,000 |
|
Subscription received (including 1,000 received in advance |
44,000 |
|
and Rs 750 for the previous year) |
|
|
Net Proceeds of Refreshment Room |
30,000 |
|
Miscellaneous Expenses |
3,000 |
|
Interest paid on loan for three months |
1,200 |
|
Rent and Rates (Including Rs 500 pre-paid) |
4,500 |
|
Lockers Rent received |
Additional Information:
Subscriptions in arrears on 31.3.2010 were Rs 4,700 and nine months interest on loan was also outstanding.
From the following Receipts and Payments Account of Kolkata Sports Club for the year ended
31.3.2011, prepare Income and Expenditure Account.
|
Receipts and Payments Account of Kolkat Sports Club for the year ended 31.3.2011 |
|||
|
Dr. |
|
|
Cr. |
|
Receipts |
Amount Rs |
Payments |
Amount Rs |
|
To Balance b/d |
3,200 |
By Salary |
1,800 |
|
To Subscription |
22,500 |
By Rent (paid on 30.9.2010 for 12 months) |
2,300 |
|
To Entrance Fees (including Rs 1,000 as capital income) |
3,000 |
By Electricity |
1,000 |
|
To Donations |
750 |
By Taxes |
2,200 |
|
To Rent of hall |
1,750 |
By Printing and Stationery |
400 |
|
To Accrued interest for the year 2009 – 2010 |
2,000 |
By Sundry Expenses |
900 |
|
|
|
By Books |
7,500 |
|
|
|
By 9% Fixed Deposit (on 1.4.2010) |
15,200 |
|
|
|
By Balance c/d |
1,900 |
|
|
33,200 |
|
33,200 |
|
|
|
|
|
Answer briefly of the following question:
Give any two differences between Revaluation Account and Realisation Account.
Achla and Bobby were partners in a firm sharing profits and losses in the ratio of 3: 1. On 31st March 2019, their balance sheet was as follows:
Balance Sheet of Achla and Bobby as on 31st March 2019
| Liabilities |
Amount(₹) |
Assets |
Amount(₹) |
| Creditors |
1,10,000 |
Cash at bank |
60,000 |
| General Reserve |
40,000 |
Debtors |
40,000 |
| Workmen's compensation reserve |
50,000 |
Stock |
45,000 |
| Capitals : |
|
Furniture |
1,55,000 |
| Achla - 4,00,000 |
|
Land & Building |
5,00,000 |
| Bobby - 2,00,000 |
6,00,000 |
|
|
|
8,00,000 |
8,00,000 |
On 1st April 2019, they admitted Vihaan as a new partner for 1/5th share in the profits of the firm on the following terms:
(a) Vihaan brought ₹ 1,00,000 as his capital and the capitals of Achla and Bobby were to be adjusted on the basis of Vihaan's capital; any surplus or deficiency was to be adjusted by opening current accounts.
(b) Goodwill of the firm was valued at ₹ 4,00,000. Vihaan brought the necessary amount in cash for his share of goodwill premium, half of which was withdrawn by the old partners.
(c) Liability on account of workmen's compensation amounted to ₹ 80,000.
(d) Achla took overstock at ₹ 35,000.
(e) Land and building was to be appreciated by 20%.
Prepare Revaluation Account, Partner's Capital Accounts, and the Balance Sheet of the reconstituted firm on Vihaan's admission.
Gita, Radha, and Garv were partners in firm sharing profits and losses in the ratio of 3: 5: 2. On 31st March 2019, their balance sheet was as follows:
Balance Sheet of Gita, Radha & Garv as on 31st March 2019
| Liabilities |
Amount (₹) |
Assets | Amount (₹) |
| Sundry Creditors |
60,000 |
Cash | 50,000 |
| General Reserve |
40,000 |
Stock | 80,000 |
| Capitals : |
|
Debtors | 40,000 |
| Gita - 3,00,000 |
|
Investments | 30,000 |
| Radha - 2,00,000 |
|
Buildings | 5,00,000 |
| Garv - 1,00,000 |
6,00,000 |
||
| 7,00,000 | 7,00,000 |
Radha retired on the above date and it was agreed that:
(a) Goodwill of the firm be valued at ₹ 3,00,000 and Radha's share be adjusted through the capital accounts of Gita and Gary.
(b) Stock was to be appreciated by 20%.
(c) Buildings were found undervalued by ₹ 1,00,000.
(d) Investments were sold for ₹ 34,000.
(e) Capital of the new firm was fixed at ₹ 5,00,000 which will be in the new profit sharing ratio of the partners; the necessary adjustments for this purpose were to be made by opening current accounts of the partners.
Prepare Revaluation Account, Partner's Capital Accounts, and the Balance Sheet of the reconstituted firm on Radha's retirement.
Which of the following transactions is debited to Revaluation Account?
X and Y were partners in the profit-sharing ratio of 3 : 2. Their balance sheet as at March 31, 2022 was as follows:
| Balance Sheet as at March 31, 2022 | |||||
| Liabilities | Amount (₹) | Assets | Amount (₹) | ||
| Creditors | 56,000 | Plant and Machinery | 70,000 | ||
| General Reserve | 14,000 | Buildings | 98,000 | ||
| Capital Accounts: | Stock | 21,000 | |||
| X | 1,19,000 | 2,31,000 | Debtors | 42,000 | 35,000 |
| Y | 1,12,000 | (-) Provision | 7,000 | ||
| Cash in Hand | 77,000 | ||||
| 3,01,000 | 3,01,000 | ||||
Z was admitted for 1/6th share on the following terms:
- Z will bring ₹ 56,000 as his share of capital but was not able to bring any amount to compensate the sacrificing partners.
- Goodwill of the firm is valued at ₹. 84,000.
- Plant and Machinery were found to be undervalued by ₹ 14,000 Building was to be brought up to ₹ 1,09,000.
- All debtors are good.
- Capitals of X and Y will be adjusted on the basis of Z’s share and adjustments will be done by opening necessary current accounts.
You are required to prepare revaluation account and partners’ capital account.
