Question 6 Chapter 1 of +2-B – T.S. Grewal 12 Class

Question 6 Chapter 1 of +2-B

Question 6 Chapter 1 of +2-B

6. A company has an opening credit balance in surplus, i.e., Balance in the statement of profit and loss of Rs 1,00,000. During the year, it earned a profit of Rs 75,000. It decided to transfer Rs 15,000 to debentures redemption reserve (DRR) and a dividend of Rs 25,000.
How will be appropriations shown in the financial statements?

The solution of Question 6 Chapter 1 of +2-B: – 

 

Particular

(1)

Note No.

(2)

Figures as at the end of the Current Reporting Period
(3)

Figures as at the end of the Previous Reporting Period
(4)
I. Equity and Liabilities      
1. Shareholders’ Funds      
(a) Share Capital      
(b) Reserves and Surplus 1 1,75,000  
    1,75,000  

 

Particular

(1)

  Amount
Reserves and Surplus    
(i) Balance in the statement of profit and loss 1,00,000  
Add: Profit during the year 75,000  
Less: Transfer to debentures redemption reserve (15,000)  
Proposed dividend (25,000) 1,35,000
(ii) Debenture redemption reserve    
Transfer from surplus, i.e., statement of profit and loss   15,000
Total of (i) and (ii) shown in the balance sheet under the surplus   1,50,000
Contingent liabilities    
Proposed dividend   25,000
    1,75,000

 

To understand more about Balance Sheet please check out following links:

Balance Sheet: Meaning, Format & Examples

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Also, Check out the solved question of previous Chapters: –

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)

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

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2 Book 3 min 225x300 - Question 6 Chapter 1 of +2-B  - T.S. Grewal 12 Class
T.S. Grewal’s Analysis of Financial Statements

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