Question 56 Chapter 1 VK Publications Class 12 Part 2

Question 56 Chapter 1 VK Publications Class 12 Part 2 – 2021

Table of Contents

The solution of Question 56 Chapter 1 VK Publications Class 12 Part 2: –

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

56. The Silver Ore Co. Ltd. was formed on April 1, 2017 with an authorised capital of Rs . 6,00,000 in shares of Rs. 10 each. Of these 52,000 shares have been issued and subscribed but there were calls-in-arrear on 100 shares @ Rs. 2.50. From the following trial balance as on 31st March, 2018, prepare the Statement of Profit and Loss and the Balance Sheet:

Particulars	Rs.	Particulars	Rs.
Cash at bank	1,05,500	Selling Expense	5,000
Share capital	5,19,750	Cartage on plant	1,800
Plant	40,000	Furniture and building	20,900
Sale of silver	1,79,500	Administrative Expenses	28,000
Mines	2,20,000	Repairs to plant	900
Promotional expenses	6,000	Coal and oil consumed	6,500
Interest on 6% FD upto 31st Dec,2017	3,900	Cash in hand	530
Dividend in investment	3,200	Investment	80,000
Royalties paid	10,000	Brokerage on investment	1,000
Railway track and wagons	17,000	6% FD in syndicate bank	89,000
Wages	74,220

Additional Information:

Depreciate plant and railway track and wagons by 10%.
Depreciate Buildings and Furniture by 5%.
Value of Stock of Silver Ore was Rs. 15,000 on 31st March, 2018.

The solution of Question 56 Chapter 1 VK Publications Class 12 Part 2: –

Statement of Profit and Loss of Silver Ore Co. Ltd. for the year ended 31st March, 2018

Particulars	Note No.	Current Year Rs.	Previous Year Rs.
I. Revenue from Operations (Sales)		1,79,500
II. Other Incomes	1	8,540
III. Total Revenue ( I+II)		1,88,040

IV. Expenses:
Cost of Material consumed	2	6,500
Change in Inventories	3	15,000
Employee Benefit Expenses	4	74,220
Depreciation and Amortization Expenses	5	6,745
Other Expenses	6	52,700
TOTAL Expenses		1,25,165

V. Profit for the year (III- IV)		62,875

Balance Sheet of Silver Ore Co. Ltd as at 31st March, 2018

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Particulars	Note No.	Current Year Rs.	Previous Year Rs.
I. EQUITY AND LIABILITIES
1.Shareholders’ Funds
(a) Share Capitals	7	5,19,750
(b) Reserves and Surplus	8	62,875
Total		5,82,625

II. ASSETS
1. Non-current Assets
(a)Fixed Assets
(i) Tangible Assets	9	2,91,155
(b) Non-current Investments	10	1,70,440
2. Current Assets
(a) Inventories	11	15,000
(b) Cash and Cash Equivalents	12	1,06,030

Total		5,82,625

Notes to Accounts:

Particulars			Rs.
1. Other income
Interest @6% on F.D.		3,900
Accrued Interest on @6% F.D. (89,000×6/100)- 3900		1,440
Dividend Received		3,200	8,540

2. Cost of Material Consumed:
Coal and Oil			6,500

3. Change in Inventories:
Closing Stock			15,000

4. Employee Benefit Expenses:
Wages			74,220

5. Depreciation and Amortization Expenses:
Plant		4,000
Railway Track and Wagon		1,700
Building and Furniture		1,045	6,745

6. Other Expenses:
Cartage on Plant		1,800
Repair to Plant		900
Promotional Expenses		6,000
Royalties paid		10,000
Selling Expenses		5,000
Administrative Expenses		28,000
Brokerage on investment		1,000	52,700

7. Share Capital
Authorised Capital:
60,000 shares of Rs. 10 each			6,00,000
Issued Capital:
52,000 shares of Rs. 10 each			5,20,000
Subscribed Capital:
Subscribed and fully paid-up (51,900 shares of Rs. 10 each)		5,19,000
Subscribed but not fully paid-up (100 shares of Rs. 10 each)	1,000
Less: Calls-in-Arrear (100x 2.50)	25	750	35,200

8. Reserves and Surplus:
Surplus, i.e., Balance in Statement of Profit and Loss			62,875

9. Tangible Assets:
Mines		2,20,000
Railway Track and Wagon	17,000
Less: Depreciation	1,700	750
Plant	40,000
Less: Depreciation	4,000	750
Furniture and Building	20,900
Less: Depreciation	10,045	750	2,91,155

10. Non-current Investments:
6% FD in Syndicate Bank	89,000
Accrued Interest on FD	1,440	90,440
Investments		80,000	91,500

11. Inventories:
Stock			1,34,700

12. Cash and Cash Equivalents:
Cash at Bank		1,05,500
Cash in Hand		530	1,06,030