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12 Questions MCQ Test Online MCQ Tests for Commerce - Test: Financial Statements of a Company- Case Based Type Questions

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Test: Financial Statements of a Company- Case Based Type Questions - Question 1

Read the following Trial Balance and answer the questions that follow:

Capital 4,00,000

(40,000 Equity Shares ₹10 each)

Bills Receivables 90,000 -

16% Mortgage Loan - 1,70,000

Stores and Spares 1,15,000 -

Debtors 1,66,000 -

Plant and Machinery 2,90,000 -

Goodwill 40,000 -

Provision for Tax - 26,000

General Reserve - 1,30,000

Cash in hand 18,000 -

Calls in Arrears 2,000 -

Marketable Securities 5,000 -

Total 7,26,000 7,26,000

What is the total Equity and Liabilities of the Balance Sheet?

Detailed Solution for Test: Financial Statements of a Company- Case Based Type Questions - Question 1
Total in the Equity side = ₹3,98,000 + ₹1,30,000 + ₹1,70,000 + ₹26,000 = ₹7,24,000
Test: Financial Statements of a Company- Case Based Type Questions - Question 2

Read the following information and answer the given questions:

Pinnacle Instruments Ltd. registered itself with a capital of ₹ 20,00,000 divided into Equity Shares of ₹100 each. On 1st June, 2015, the company issued 5,000 Equity Shares as fully paid to Mila Herbals, as purchase consideration for the purchase of plant and machinery. The remaining shares were issued to the public at par. Till the date of the Balance Sheet, the directors had called from the public, 60% of the nominal value of the shares. The amount called was received by the company.

How many shares did the Pinnacle Instruments Ltd. registered itself with?

Detailed Solution for Test: Financial Statements of a Company- Case Based Type Questions - Question 2
20,00,000 ÷ 100 = 20,000
Test: Financial Statements of a Company- Case Based Type Questions - Question 3

Read the following information and answer the given questions:

Ajmera Ltd. raised the following loans in the year 2016-17:

12% Bank Loan from SBI on 1st April, 2016 ₹15,00,000

10,000, 10% Debentures of ₹100 each, redeemable at par in 4 equal yearly instalments, on 1 should be superscript October, 2016

The terms of the loans were :

(a) The Redemption of Debentures to begin from 30th September, 2017.

(b) Interest on the Bank Loan to be paid annually but Interest on Debentures to be paid half yearly.

The company had not paid the interest, both on the Bank Loan and on the Debentures till the Balance Sheet date.

What is the amount of debentures to be shown in the balance sheet?

Detailed Solution for Test: Financial Statements of a Company- Case Based Type Questions - Question 3
Ajmera Ltd. raised finance through 10,000, 10% Debentures of ₹100 each.
Test: Financial Statements of a Company- Case Based Type Questions - Question 4

Read the following Trial Balance and answer the questions that follow:

Capital 4,00,000

(40,000 Equity Shares ₹10 each)

Bills Receivables 90,000 -

16% Mortgage Loan - 1,70,000

Stores and Spares 1,15,000 -

Debtors 1,66,000 -

Plant and Machinery 2,90,000 -

Goodwill 40,000 -

Provision for Tax - 26,000

General Reserve - 1,30,000

Cash in hand 18,000 -

Calls in Arrears 2,000 -

Marketable Securities 5,000 -

Total 7,26,000 7,26,000

What is the amount of Share Capital to be shown in the Balance Sheet?

Detailed Solution for Test: Financial Statements of a Company- Case Based Type Questions - Question 4
₹4,00,000 – ₹2,000 = ₹3,98,000
Test: Financial Statements of a Company- Case Based Type Questions - Question 5

Read the following information and answer the given questions:

Pinnacle Instruments Ltd. registered itself with a capital of ₹ 20,00,000 divided into Equity Shares of ₹100 each. On 1st June, 2015, the company issued 5,000 Equity Shares as fully paid to Mila Herbals, as purchase consideration for the purchase of plant and machinery. The remaining shares were issued to the public at par. Till the date of the Balance Sheet, the directors had called from the public, 60% of the nominal value of the shares. The amount called was received by the company.

What will be the amount of Share Capital shown in the Balance Sheet?

Detailed Solution for Test: Financial Statements of a Company- Case Based Type Questions - Question 5

Subscribed Capital: Amount ()

5000 equity shares @ 5,00,000

₹100 issued against

purchase of Plant

and Machinery.

15,000 equity shares @ ₹60 9,00,000

Total 14,00,000

Test: Financial Statements of a Company- Case Based Type Questions - Question 6

Read the following information and answer the given questions:

Ajmera Ltd. raised the following loans in the year 2016-17:

12% Bank Loan from SBI on 1st April, 2016 ₹15,00,000

10,000, 10% Debentures of ₹100 each, redeemable at par in 4 equal yearly instalments, on 1 should be superscript October, 2016

The terms of the loans were :

(a) The Redemption of Debentures to begin from 30th September, 2017.

(b) Interest on the Bank Loan to be paid annually but Interest on Debentures to be paid half yearly.

The company had not paid the interest, both on the Bank Loan and on the Debentures till the Balance Sheet date.

Under which head will the long term borrowings come?

Detailed Solution for Test: Financial Statements of a Company- Case Based Type Questions - Question 6
Any liability that needs to be fulfilled not recently is called non-current liability.
Test: Financial Statements of a Company- Case Based Type Questions - Question 7

Read the following Trial Balance and answer the questions that follow:

Capital 4,00,000

(40,000 Equity Shares ₹10 each)

Bills Receivables 90,000 -

16% Mortgage Loan - 1,70,000

Stores and Spares 1,15,000 -

Debtors 1,66,000 -

Plant and Machinery 2,90,000 -

Goodwill 40,000 -

Provision for Tax - 26,000

General Reserve - 1,30,000

Cash in hand 18,000 -

Calls in Arrears 2,000 -

Marketable Securities 5,000 -

Total 7,26,000 7,26,000

On which head will the Bills receivable be shown in the balance sheet?

Detailed Solution for Test: Financial Statements of a Company- Case Based Type Questions - Question 7
Trade receivables are the total amounts owing to a company for goods or services it has sold, which are reflected in invoices that the company has issued to its clients, but has not yet received payments for. For an invoice amount to be added to trade receivables, full payment must be expected within one year.
Test: Financial Statements of a Company- Case Based Type Questions - Question 8

Read the following information and answer the given questions:

Pinnacle Instruments Ltd. registered itself with a capital of ₹ 20,00,000 divided into Equity Shares of ₹100 each. On 1st June, 2015, the company issued 5,000 Equity Shares as fully paid to Mila Herbals, as purchase consideration for the purchase of plant and machinery. The remaining shares were issued to the public at par. Till the date of the Balance Sheet, the directors had called from the public, 60% of the nominal value of the shares. The amount called was received by the company.

How many shares are issued as against the purchase of plant and machinery?

Detailed Solution for Test: Financial Statements of a Company- Case Based Type Questions - Question 8
5,000 shares are issued as against the purchase of plant and machinery.
Test: Financial Statements of a Company- Case Based Type Questions - Question 9

Read the following information and answer the given questions:

Ajmera Ltd. raised the following loans in the year 2016-17:

12% Bank Loan from SBI on 1st April, 2016 ₹15,00,000

10,000, 10% Debentures of ₹100 each, redeemable at par in 4 equal yearly instalments, on 1 should be superscript October, 2016

The terms of the loans were :

(a) The Redemption of Debentures to begin from 30th September, 2017.

(b) Interest on the Bank Loan to be paid annually but Interest on Debentures to be paid half yearly.

The company had not paid the interest, both on the Bank Loan and on the Debentures till the Balance Sheet date.

What is the total amount of Long-term borrowings to be shown in the Balance Sheet?

Detailed Solution for Test: Financial Statements of a Company- Case Based Type Questions - Question 9
Long-term borrowing consists of a long application process where repayments are made for several years in order to pay off the loan. The type of loan that you borrow affects the business considering the amount of interest that you pay over the specified period of time.
Test: Financial Statements of a Company- Case Based Type Questions - Question 10

Read the following Trial Balance and answer the questions that follow:

Capital 4,00,000

(40,000 Equity Shares ₹10 each)

Bills Receivables 90,000 -

16% Mortgage Loan - 1,70,000

Stores and Spares 1,15,000 -

Debtors 1,66,000 -

Plant and Machinery 2,90,000 -

Goodwill 40,000 -

Provision for Tax - 26,000

General Reserve - 1,30,000

Cash in hand 18,000 -

Calls in Arrears 2,000 -

Marketable Securities 5,000 -

Total 7,26,000 7,26,000

What is the total amount of Fixed Assets as shown in the balance sheet?

Detailed Solution for Test: Financial Statements of a Company- Case Based Type Questions - Question 10
₹2,90,000 + ₹40,000 = ₹3,30,000
Test: Financial Statements of a Company- Case Based Type Questions - Question 11

Read the following information and answer the given questions:

Pinnacle Instruments Ltd. registered itself with a capital of ₹ 20,00,000 divided into Equity Shares of ₹100 each. On 1st June, 2015, the company issued 5,000 Equity Shares as fully paid to Mila Herbals, as purchase consideration for the purchase of plant and machinery. The remaining shares were issued to the public at par. Till the date of the Balance Sheet, the directors had called from the public, 60% of the nominal value of the shares. The amount called was received by the company.

Where will the Plant and Machinery be shown in the balance sheet?

Detailed Solution for Test: Financial Statements of a Company- Case Based Type Questions - Question 11
Property, plant and equipment is the long-term asset or noncurrent asset section of the balance sheet that reports the tangible, long-lived assets that are used in the company's operations. These assets are commonly referred to as the company's fixed assets or plant assets.
Test: Financial Statements of a Company- Case Based Type Questions - Question 12

Read the following information and answer the given questions:

Ajmera Ltd. raised the following loans in the year 2016-17:

12% Bank Loan from SBI on 1st April, 2016 ₹15,00,000

10,000, 10% Debentures of ₹100 each, redeemable at par in 4 equal yearly instalments, on 1 should be superscript October, 2016

The terms of the loans were :

(a) The Redemption of Debentures to begin from 30th September, 2017.

(b) Interest on the Bank Loan to be paid annually but Interest on Debentures to be paid half yearly.

The company had not paid the interest, both on the Bank Loan and on the Debentures till the Balance Sheet date.

How will then 10% debentures be recorded in the Balance Sheet?

Detailed Solution for Test: Financial Statements of a Company- Case Based Type Questions - Question 12
Debentures issued are shown under the heading of Non-current liabilities and subheading Long Term Borrowings.
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