CBSE Class 12 Accountancy HOTs Financial Statements of a Company
Q.1. Describe the general requirements of the Companies Act 1956 for the preparation and presentation of Balance Sheet of a company.
Ans.The following are the main provisions laid down by the Companies Act 1956 regarding the preparation and presentation of final accounts of companies.
a) The Balance Sheet and Profit and Loss Account are to be drawn up in strict confirmity with the provisions of Section 211 and Schedule VI of the Companies Act.
b) The annual accounts and every other documents annexed or attached to it must be filed with the Registrar of Companies together with the audit report.
c) The annual accounts must given a true and fair view of the state of affairs of the company at the end of the financial year and the result of operations during the period.
Q.2. Prepare a layout of information required to given
under the heading share capital.
Share Capital
Authorised
-------- shares of Rs. ------ each ×××
Issued
-------- shares of Rs. ------- each ×××
Subscribed
Ans.------ shares of Rs. ------- each
Rs. ------ per share called up ×××
Less : Unpaid calls ×××
×××
Add : Forfeited shares ××× ×××
Q.3. State under which headings the following items will appear.
(i) Share forfeited account
(ii) Unclaimed dividend
(iii) Share premium account
(iv) Proposed dividend
(v) Sundry creditors
(vi) Provision for taxation
(vii) Income received in advance
(viii) Fixed deposits
Ans.(i) Share forfeited account - Share capital
(ii) Share premium account - Reserves and Surplus
(iii) Unclaimed dividend - Current liability
(iv) Proposed dividend - Provision
(v) Sundry creditors - Current liabilities
(vi) Provision for taxation - Provision
(vii) Income received in advance - Current liabilities
(viii) Fixed deposits - Unsecured loans
4. Explain the treatment of the following items in the Balance Sheet.
(i) Forfeited shares
(ii) Interest accrued but not due on loans
(iii) Calls in arrears
(iv) Interest to be paid in secured loans
Ans.(i) Add the amount to subscribed capital.
(ii) Show it under the heading current liabilities.
(iii) Subtract it from subscribed capital.
(iv) Show it under the heading secured loans.
5. Record the items which are included under the heading Current Assets and Loans and Advances.
A. Current Assets
1. Interest accrued on investments
2. Stores and spare parts 3. Loose tools
4. Stock-in-trade 5. Work-in-progress
6. Sundry debtors 7. Cash balance in hand
8. Bank balance
B. Loans and Advances
9. a. Advances and loans to subsidiaries.
b. Advances and loans in partnership firm in which company or any of its subsidiaries is a partner.
10. Bills of Exchange
11. Advances recoverable in cash or kind or for value to be received.
12. Balances with customs, port trust etc.