Question 43 Chapter 5 of +2-B - T.S. Grewal 12 Class

Question 43 Chapter 5 of +2-B

Table of Contents

The solution of Question 43 Chapter 4 of +2-B: –

T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

43. Following are the Balance Sheets of Solar Power Ltd. as at 31st March, 2014 and 2013:

BALANCE SHEET of Solar Power Ltd.
Particulars	Note No.	31st March 2014 Rs	31st March 2013 Rs
I. EQUITY AND LIABILITIES
1. Shareholders’ Funds
(a) Share Capital		24,00,000	22,00,000
(b) Reserves and Surplus	1	6,00,000	4,00,000
2. Non-Current Liabilities
Long-term Borrowings		4,80,000	3,40,000
3. Current Liabilities
(a) Trade Payables		3,58,000	4,08,000
(b) Short-term Provisions		1,00,000	1,54,000
Total		39,38,000	35,02,000
II. ASSETS
1. Non-Current Assets
Fixed Assets :
(i)Tangible Assets	2	21,40,000	17,00,000
(ii) Intangible Assets	3	80,000	2,24,000
2. Current Assets
(a) Current Investments		4,80,000	3,00,000
(b) Inventories		2,58,000	2,42,000
(c) Trade Receivables		3,40,000	2,86,000
(d) Cash and Cash Equivalents		6,40,000	7,50,000
Total		39,38,000	35,02,000

Notes to Accounts

Particulars	31st March,	31st March, 2013 (Rs)
	2014 (Rs)
1. Reserves and Surplus
Surplus, i.e., Balance in Statement of Profit and Loss	6,00,000	4,00,000
2. Tangible Assets
Machinery	25,40,000	20,00,000
Less: Accumulated Depreciation	4,00,000	3,00,000
	21,40,000	17,00,000
3. Intangible Assets
Goodwill	80,000	2,24,000
	80,000	2,24,000

Additional Information:
During the year, a piece of machinery costing 48,000 on which accumulated depreciation was Rs 32,000. was sold for Rs 12,000.
Prepare Cash Flow Statement.

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The solution of Question 43 Chapter 4 of +2-B: –

Cash Flow Statement for the year ended 31st March,2013
Particulars		Rs
I. Cash Flow from Financing Activities
Profit as per Statement of Profit and Loss :
Closing Balance of Profit & Loss	6,00,000
Less: Opening Balance of Profit & Loss	4,00,000	2,00,000
Profit Before Tax and extraordinary Items		2,00,000
Items to be Added:
Amortisation of Goodwill	1,44,000
Depreciation (WN I)	1,32,000
Loss on Sale of Fixed Assets	4,000	2,80,000
Operating Profit before Working Capital Adjustments		4,80,000
Less: Increase in Current Assets
Inventories	16,000
Trade Receivables	54,000
Less: Decrease in Current Liabilities
Trade Payables	50,000
Short-Term Provisions	54,000	1,74,000
Net Cash Flow from Operating Activities		3,06,000
II. Cash Flow from Financing Activities
Sale of Machinery	12,000
Purchase of Machinery (WN II)	5,88,000	5,76,000
Net Cash Used in Investing Activities		5,76,000
III: Cash Flow from Financing Activities
Proceeds from Issue of Share Capital	2,00,000
Proceeds from Long Term Borrowings	1,40,000	3,40,000
Net Cash Flow from Financing Activities		3,40,000
IV. Net Decrease in Cash and Cash Equivalents		70,000
Add: Cash and Cash Equivalents in the beginning of the period		10,50,000
Cash and Cash Equivalents at the end of the period		11,20,000

Accumulated Depreciation Account
Particulars	Rs	Particular	Rs
To Machinery A/c	32,000	By Balance b/d	3,00,000
To Balance c/d	4,00,000	By Profit and Loss A/c (Dep. charged during the year) (Bal. Fig.)	1,32,000
	4,32,000		4,32,000

Machinery Account
Particulars	Rs	Particular	Rs
To Balance b/d	20,00,000	By Accumulated Depreciation A/c*	32,000
To Bank A/c (Purchase) (Bal. Fig.)	5,88,000	By Bank A/c (Sale)	12,000
		By Loss on Sale (Profit and Loss A/c)	4,000
		By Balance c/d	25,40,000
	25,88,000		25,88,000