Financial Accounting & Reporting — Winter 2024

Explain various accounting concepts and conventions.

Explain process of accounting in detail.

Journalized the following transactions for April, 2023. April 1- Mohan commenced business with cash Rs. 20,00,000. April 2 - Deposited into bank Rs. 17,00,000. April 4 - Bought furniture for office for cash Rs. 60,000. April 13 - Goods sold to Gopal on credit Rs. 1,00,000. April 15 - Bought goods from Ram on credit Rs. 1,10,000. April 28 - Paid Ram in full settlement Rs. 1,06,000. April 30 - Paid rent Rs. 20,000

Write a note on Financial Statement Analysis.

Particular Amount Sales (40% cash sales) 15,00,000 Less: Cost of sales 7,50,000 Gross Profit: 7,50,000 Less: Office Exp. (including int. on debentures) 1,25,000 Selling Exp. 1,25,000 Profit before Taxes: 5,00,000 Less: Taxes 2,50,000 Net Profit: 2,50,000 Page 1 of Balance Sheet Liabilities Amount Asset Amount Equity share capital 20,00,000 Fixed Assets 55,00,000 10% Preference share capital 20,00,000 Stock 1,75,000 Reserves 11,00,000 Debtors 3,50,000 10% Debentures 10,00,000 Bills receivable 50,000 Creditors 1,00,000 Cash 2,25,000 Bank‐overdraft 1,50,000 Fictitious Assets 1,00,000 Bills payable 45,000 Outstanding expenses 5,000 64,00,000 64,00,000 Calculate the following ratios; also discuss the position of the company: (1) Gross profit ratio. (2) Stock turnover ratio. (3) Current ratio. (4) Debtor’s ratio. (5) Creditor’s ratio. (6) Rate of return on net capital employed. (7) Rate of return on equity shares. The opening stock was of Rs. 3,25,000. Taking 360 days of the year.

Explain trend analysis with the help of a hypothetical example

From the following information of Beta Ltd. for the year ending 31st March 2022 and 31st March 2023. Prepare a Comparative Statement of Profit & Loss A/c of Beta Ltd. Profit & Loss A/c Particulars Note 31st March 31st March No. 2023 2022 Revenue from operations 20,00,000 16,00,000 Employees Benefit Expenses 10,00,000 8,00,000 Depreciation & Amortization Expenses 25,000 20,000 Other expenses 75,000 1,80,000 Tax Rate is 30%

Write a note on Management Discussion and Analysis

Explain the Financial disclosure requirements under different heads.

Write down the format of Balance sheet as prescribed in schedule III of Companies Act , 2013 with imaginary numbers.

Describe Related Party? Who falls under related party relationships? Page 2 of

CASE STUDY: Following is the Trial Balance of Fortune Co. Ltd. As on 31-03-2022 Particulars Dr. Cr. Land & Building 2,00,000 Furniture 60,000 Equity Share Capital 2,50,000 10% Preference Share Capital 1,00,000 Stock (01-04-2021) 1,00,000 Call in Arrears 10,000 Investments 3,00,000 Share Forfeiture A/c 5,000 Sales 8,10,000 10% Debentures 2,00,000 Debtors 2,50,000 Purchase Return 30,000 Public Deposits 50,000 Cash-Bank 40,000 Purchases 5,30,000 Sales Return 10,000 Provident Fund 35,000 General Reserve 1,30,000 Profit & Loss A/c (01-04-2021) 73,000 Creditors 65,000 Salary & Wages 65,500 Interest on Investment 7,500 Bad Debt 10,000 Preliminary Exp 20,000 Interest on Debentures 10,000 Director's fee 80,000 Income Tax paid in Advance 70,000 Total 17,55,500 17,55,500 Adjustments 1. The Closing Stock as on 31-03-2022 was 1,75,000. 2. Provide 5% Reserve for B.D.R 3. Write off Depreciation on Fixed Assets at 10% 4. The Directors have recommended dividend on Preference share capital and 12% on Equity share capital 5. Transfer to General Reserve Rs. 20,000 6. Write Off 10% of Preliminary Expenses From the above information, you are required to prepare the profit and loss A/Cand Balance sheet of Fortune Co. Ltd for the year 2022 as per the Vertical format.

CASE STUDY: From the following information, you are required to prepare Cash Flow Statement of Sanghvi Auto parts Ltd. for the year ending 31st March, 2023. Page 3 of Balance Sheets Liabilities 31-3-2022 31-3-2023 Asset 31-3-2022 31-3-2023 Share Capital 70,000 70,000 Plant-Machinery 50,000 91,000 Secured Loan - 40,000 Stock 15,000 40,000 Creditors 14,000 39,000 Debtors 5,000 20,000 Tax Payable 1,000 3,000 Cash 20,000 7,000 Profit & Loss A/c 7,000 10,000 Prepaid Expenses 2,000 4,000 92,000 1,62,000 92,000 1,62,000 Profit & Loss A/c (31-3-2023) Particulars Rs Particulars Rs To Opening Stock 15,000 By Sales 1,00,000 To Purchases 98,000 By Closing Stock 40,000 To Gross Profit 27,000 1,40,000 1,40,000 To General Expenses 11,000 By Gross Profit-b/d 27,000 To Depreciation 8,000 To Taxation 4,000 To Dividend 1,000 To Net Profit 3,000 27,000 27,000 Page 4 of