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Exam Reg. No

Exam: Model Exam Set 2

Subject: Advanced Accounting Total No. of Printed Pages : 15

Maximum Marks : 100 Time Allowed : 3 Hr

General Instructions to the Candidate.

1. The Question Paper comprises two parts, Part I and Part II

2. Part I comprise Multiple Choice Questions (MCQs)

3. Part II comprises questions which require descriptive type answers.

4. Answers to Questions in Part I are to be marked on the OMR answer sheets only. Answers to

Questions in Part II are to be written on the descriptive type answer book.

Division A is compulsory

Division A – 30 Marks.

Questions no. (1-15) carry 2 Marks each

Case Scenario: 1 Q.No. (1-4)

Axis limited is a manufacturing company. It purchased a machinery costing Rs. 10 Lakhs in

April 2023. It paid Rs. 4 lakhs upfront and paid the remaining Rs. 6,00,000 as deferred payment

by paying instalment of Rs. 1,05,000 for the next 6 months. During the year, the Company sold a

land which was classified as its ‘property, plant and equipment’ for Rs. 25,00,000 and paid Rs.

1,00,000 as income tax as long term capital gain on such sale. During the year, the Company also

received income tax refund along with interest.

Based on the above information, answer the following questions:

1. As per the requirements of AS 3, ‘Cash Flow Statements’, how the amount for purchase of

machinery should be presented:

(a) Rs. 10 lakhs as ‘Cash flows from Investing Activities’ and Rs. 30,000 will simply be booked in

profit and loss with no presentation if Cash Flow Statement.

(b) Rs. 10.30 lakhs as ‘Cash flows from Investing Activities’ as entire amount is spend on

purchase of machinery.

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(c) Rs. 10 lakhs as ‘Cash flows from Investing Activities’ and Rs. 30,000 as ‘Cash flows from

Financing Activities’.

(d) Rs. 10.30 lakhs as ‘Cash flows from Financing Activities’ as the machinery has been

purchased on finance.

2. At what amount, the machinery should be recognised in the financial statements:

(a) Rs. 400,000 (b) Rs. 10,30,000 (c) Rs. 600,000 (d) Rs. 10,00,000

3. How should the income tax paid on sale of land should be disclosed in the Cash Flows

Statement:

(a) Cash flows from Operating Activities (b) Cash flows from Investing Activities

(c) Cash flows from Financing Activities (d) No disclosure in Cash Flow Statement

4. How should the interest on income tax refunds should be disclosed in the Cash Flows

Statement:

(a) Cash flows from Operating Activities (b) Cash flows from Investing Activities

(c) Cash flows from Financing Activities (d) No disclosure in Cash Flow Statement

Case Scenario: 2 Q.No. (5-8)

Aazad Ltd. has the following particulars:

Particulars Rs. (lacs)

10% Preference Share Capital (Rs. 10 each) 2,500

Equity Share Capital of Rs. 10 each 8,000

Capital Redemption Reserve 1,000

Securities Premium 800

General Reserve 6,000

Profit & Loss A/c 300

Cash 1,650

Investments (Market Value Rs. 1,500 lacs) 3,000

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The company decides to redeem all it’s preference shares at a premium of 10% and buys back

25% of equity shares @ Rs. 15 per share. Investments amounting to Market Value of Rs. 1,000

lakhs sold at Rs. 3,000 lakhs and raises a bank loan of Rs. 2,000 lakhs.

Answer the following questions based on above information:

5. The amount of Profit/Loss on Sale of Investment is:

(a) Rs. 1,500 lakhs Profit (b) Rs. 1,000 lakhs Profit

(c) Rs. 2,000 lakhs Loss (d) Rs. 1,000 lakhs Loss

6. Securities Premium available for Buyback after redemption of Preference Shares

(a) Rs. 550 lakhs (b) Rs. 800 lakhs

(c) Can’t utilize securities premium for buyback (d) Rs. 350 lakhs

7. Total amount to be transferred to Capital Redemption Reserve:

(a) Rs. 2,000 lakhs (b) Rs. 4,500 lakhs (c) Rs. 2,500 lakhs (d) Rs. 1,750 lakhs

8. Cash balance after buyback

(a) Rs. 1,150 lakhs (b) Rs. 2,200 lakhs (c) Rs. 3,250 lakhs (d) Rs. 900 lakhs

Case Scenario: 3 Q.No. (9-12)

SEAS Ltd., the “Company”, is in the business of tours and travels. It sells holiday packages to

the customers. The Company negotiates upfront with the Airlines for specified number of seats

in flight. The Company agrees to buy a specific number of tickets and pay for those tickets

regardless of whether it is able to resell all of those in package.

The rate paid by the Company for each ticket purchased is negotiated and agreed in advance.

The Company also assists the customers in resolving complaints with the servi ce provided by

airlines. However, each airline is responsible for fulfilling obligations associated with the ticket,

including remedies to a customer for dissatisfaction with the service.

The Company bought a forward contract for three months of US$ 1,00,000 on 1 March 2024 at 1

US$ = INR 83.10 when exchange rate was US$ 1 = INR 83.02. On 31 March 2024, when the

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Company closed its books, exchange rate was US$ 1 = INR 83.15. On 1 April 2024, the Company

decided for premature settlement of the contract due to some exceptional circumstances.

The Company is evaluating below mentioned schemes:

i. Introduction of a formal retirement gratuity scheme by an employer in place of ad hoc ex -

gratia payments to employees on retirement.

ii. Management decided to pay pension to those employees who have retired after completing 5

years of service in the organization. Such employees will get pension of Rs. 20,000 per month.

Earlier there was no such scheme of pension in the organization. SEAS Ltd. has a subsidiary,

ADI Ltd., which is in the business of construction having turnover of Rs. 200 crores. SEAS Ltd.

and ADI Ltd. hold 9% and 23% respectively in an associate company, ASOC Ltd. Both SEAS

Ltd. and ADI Ltd. prepare consolidated financial statements as per Accounting Standards

notified under the Companies (Accounting Standards) Rules, 2006.

Answer the following questions based on above information:

9. What would be the basis of revenue recognition for SEAS Ltd. as per the requirements of

Accounting Standards?

(a) Gross basis. (b) Net basis.

(c) Depends on the accounting policy of the Company.

(d) Indian GAAP allows a choice to the Company to recognize revenue on gross bas is or net

basis.

10. Please suggest accounting treatment of forward contract for the year ended 31 March 2024 as

per Accounting Standard 11.

(a) MTM (marked to market value) of contract will be recorded on 31 March 2024.

(b) MTM (marked to market value) of contract will be computed as at 31 March 2024 and only if

there is loss, it will be recorded during the year ended 31 March 2024.

(c) No accounting will be done during the year ended 31 March 2024.

(d) Premium on contract will be amortized over the life of the contract.

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11. You are requested to advise the Company in respect of the accounting requirements of above

schemes related to employee benefits as to which one of those schemes should be considered as

a change in accounting policy during the year.

(a) 1 – Change in accounting policy. 2 – Change in accounting policy.

(b) 1– Not a change in accounting policy. 2 – Change in accounting policy.

(c) 1 – Not a change in accounting policy. 2 – Not a change in accounting policy.

(d) 1– Change in accounting policy. 2 – Not a change in accounting policy.

12. Please comment regarding consolidation requirements for SEAS Ltd. and ADI Ltd. using the

below mentioned options as to which one should be correct.

(a) ADI Ltd. would using equity method of accounting for 23% in ASOC Ltd. SEAS Ltd. would

consolidate ADI Ltd. and consequently automatically equity account 23% and separately

account for the balance 9% as per AS 13.

(b) ADI Ltd. would account for 23% in ASOC Ltd. as per AS 13. SEAS Ltd. would consolidate

ADI Ltd. and consequently automatically account 23% and separately account for the balance

9%.

(c) ADI Ltd. would account for 23% share in ASOC Ltd using equity method of accounting.

SEAS Ltd. would consolidate ADI Ltd. and consequently, automatically account for ASOC Ltd

23% share and separately account for 9% share in ASOC Ltd. using equity method of

accounting in consolidated financial statements.

(d) ADI Ltd. would account for 23% in ASOC Ltd. as per AS 13. SEAS Ltd. would consolidate

ADI Ltd. and using equity method of accounting 23% in ASOC Ltd. and separately account for

the balance 9% as per AS 13.

General MCQs:

13. Gyan Ltd. borrowed Rs. 10 crore for construction of a plant at the rate of 10% per annum

(interest paid annually Rs. 1 crore). The construction was being carried on and out of the

borrowings, Rs. 4 crore was temporarily placed in a fixed deposit at the rate of 6% per annum

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(interest earned Rs. 24 lakh). At the year end, how much cost of borrowing Gyan Limited will

capitalise?

(a) Interest paid on Rs. 10 crore i.e. Rs. 1 crore

(b) Interest paid on Rs. 6 crore as only this amount was utilized i.e. Rs. 60 Lakh.

(c) Interest paid less income on temporary investment i.e. Rs. 76 lakh

(d) Nothing will be capitalized

14. XY Ltd. agrees to construct a building on behalf of its client GH Ltd. on 1st April 20X1. The

expected completion time is 3 years. XY Ltd. incurred a cost of Rs. 30 lakh up to 31st March

20X2. It is expected that additional costs of Rs. 90 lakh. Total contract value is Rs. 112 lakh. As at

31st March 20X2, XY Ltd. has billed GH Ltd. for Rs. 42 lakh as per the agreement. Assume that

the work is completed to the extent of 75% by the end of Year 2.

Revenue to be recognized by XY Ltd. for the year ended 31st March 20X2 is

a) Rs. 28 lakh b) Rs. 42 lakh c) Rs. 30 lakh d) Rs. 32 lakh

15. An entity prepares quarterly interim financial reports in accordance with AS 25. The entity is

engaged in sale of mobile phones and normally 5% of customers claim on their warranty. The

provision in the first quarter was calculated as 5% of sales to date, which was Rs.10 million.

However, in the second quarter, a fault was found and warranty claims were expected to be

10% for the whole of the year. Sales in the second quarter were Rs.15 million. What would be

the provision charged in the second quarter’s interim financial statements?

a) Rs.1 million b) Rs.2 million c) Rs.1.25 million d) Rs.1.5 million

Division B - 70 Marks

Question No. 1 is compulsory.

Attempt any four questions from the Rest

1. a) A company is engaged in the business of refining, transportation and marketing of petroleum

products. During the financial year ended 31st March, 2024, the company acquired controlling
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interest from Government of India in another public sector undertaking @ Rs. 1,551 per share as

against the book value of Rs. 192.58 per share and market value of Rs. 876 per share as on 18th

February, 2024. Thus, the strategic premium of Rs. 675 per share has been paid considering

various tangible and intangible factors.

The above investment in the shares of the acquired company has been considered as long term

strategic investment and, therefore, has been accounted for at cost, i.e. at Rs. 1,551 per share in

the financial statements. No provision for diminution in value has been made in the

books of account.

As per the requirement of Schedule III to the Companies Act, 2013, the aggregate market value

of the quoted shares has been properly reflected in the financial statements. On 28th March,

2024, the acquired shares were quoted at Rs. 880 per share on BSE and the current market price

as on 18th July was around Rs. 300. Considering the tangible and intangible benefits the

Management is of the view that there is no permanent diminution in the value of the

strategic investment in the acquired company, as the same has been considered as a long-term

investment. Therefore, there is no need for provision for diminution in the value of the shares of

the acquired company.

Required:

(i) Whether the accounting treatment 'at cost' under the head ‘Long Term Investments’ without

providing for any diminution in value is correct and in accordance with the provisions of AS 13.

(ii) If any provision for diminution in the value is to be made, whether such provision should be

charged to the profit and loss account or whether same can be considered as deferred

expenditure and amortised over a period of 5 years. Whether it is open for the company to

charge off such diminution in the value in the books of account instead of creating provision.

(iii) Whether the premium paid for strategic benefits for investment described in facts of the

case, can be accounted for separately in the books of account keeping in view that AS 13

specifies that long term investments should be recorded at cost and there is no specific

provision in the standard in respect of accounting for premium paid for strategic benefits.

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b) Akshar Ltd. installed a new Plant (not a qualifying asset), at its production facility, and incurred

the following costs:

▪ Cost of the Plant (as per supplier’s invoice): Rs. 30,00,000

▪ Initial delivery and handling costs: Rs. 1,00,000

▪ Cost of site preparation: Rs. 2,00,000

▪ Consultant fee for advice on acquisition of Plant: Rs. 50,000

▪ Interest charges paid to supplier against deferred credit: Rs. 1,00,000

▪ Estimate of Dismantling and Site Restoration costs: Rs. 50,000 after 10 years (Present

Value is Rs. 30,000)

▪ Operating losses before commercial production: Rs. 40,000

The company identified motors installed in the Plant as a separate component and a cost of Rs.

5,00,000 (Purchase Price) and other costs were allocated to them proportionately. The company

estimates the useful life of the Plant and those of the Motors as 10 years and 6 years

respectively and SLM method of Depreciation is used.

At the end of Year 4, the company replaces the Motors installed in the Plant at a cost of Rs.

6,00,000 and estimated the useful life of new motors to be 5 years. Also, the company revalued

its entire class of Fixed Assets at the end of Year 4. The revalued amount of Plant as a whole is

Rs. 25,00,000. At the end of Year 8, the company decides to retire the Plant from active use and

also disposed the Plant as a whole for Rs. 6,00,000.

There is no change in the Dismantling and Site Restoration liability during the period of use.

You are required to explain how the above transaction would be accounted in accordance with

AS 10.

2. Following is the trial balance of Delta limited as on 31.3.2023. (Figures in Rs. ‘000)

Particulars Debit Particulars Credit

Land at cost 800 Equity share capital (shares of

Rs. 10 each) 500

Calls in arrears 5 10% Debentures 300

Cash in hand 2 General reserve 150

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Plant & Machinery at cost 824 Profit & Loss A/c (balance on

1.4.22) 75

Trade receivables 120 Securities premium 40

Inventories (31-3-23) 96 Sales 1200

Cash at Bank 28 Trade payables 30

Adjusted Purchases 400 Provision for depreciation 150

Factory expenses 80 Suspense Account 10

Administrative expenses 45

Selling expenses 25

Debenture Interest 30

2455 2455

Additional Information:

(i) The authorized share capital of the company is 80,000 shares of Rs. 10 each.

(ii) The company revalued the land at Rs. 9,60,000.

(iii) Equity share capital includes shares of Rs. 50,000 issued for consideration other than cash.

(iv) Suspense account of Rs. 10,000 represents cash received from the sale of some of the

machinery on 1.4.2022. The cost of the machinery was Rs. 24,000 and the accumulated

depreciation thereon being Rs. 20,000. The balance of Plant & Machinery given in trial balance is

before adjustment of sale of machinery.

(v) Depreciation is to be provided on plant and machinery at 10% on cost.

(vi) Balance at bank includes Rs. 5,000 with ABC Bank Ltd., which is not a Scheduled Bank.

(vii) Make provision for income tax @30%.

(viii) Trade receivables of Rs. 50,000 are due for more than six months.

You are required to prepare Delta Limited's Balance Sheet as at 31.3.2023 and Statement of

Profit and Loss with notes to accounts for the year ended 31.3.2023 as per Schedule Ill. Ignore

previous year's figures & taxation.

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3. a) Ram Ltd. purchased machinery for Rs. 80 lakhs (useful life 4 years and residual value Rs. 8

lakhs). Government grant received was Rs. 32 lakhs. The grant had to be refunded at the

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beginning of third year. Show the Journal Entry to be passed at the time of refund of grant and

the value of the fixed assets in the third year and the amount of depreciation for remaining two

years, if the grant had been credited to Deferred Grant A/c.

b) A plant was acquired 15 years ago at a cost of Rs. 5 crores. Its accumulated depreciation as at

31st March, 20X1 was Rs. 4.15 crores. Depreciation estimated for the financial year 20X1-20X2 is

Rs. 25 lakhs. Estimated Net Selling Price as on 31st March, 20X1 was Rs. 30 lakhs, which is

expected to decline by 20 per cent by the end of the next financial year. Its value in use has been

computed at Rs. 35 lakhs as on 1st April, 20X1, which is expected to decrease by 30 per cent by

the end of the financial year.

(i) Assuming that other conditions for applicability of the impairment Accounting Standard are

satisfied, what should be the carrying amount of this plant as at 31st March, 20X2?

(ii) How much will be the amount of write off for the financial year ended 31st March, 20X2?

(iii) If the plant had been revalued ten years ago and the current revaluation reserves against

this plant were to be Rs. 12 lakhs, how would you answer to questions (i) and (ii) above?

(iv) If the value in use was zero and the enterprise were required to incur a cost of Rs. 2 lakhs to

dispose of the plant, what would be your response to questions (i) and (ii) above?

4. The following are the Balance Sheets of Aakash Limited and Ganga Limited as at March 31,

2021:

Particulars Note No. Aakash Limited Ganga Limited

(Rs.) (Rs.)

I. Equity and Liabilities:

(1) Shareholder's Funds:

(a) Share Capital 1 80,00,000 20,00,000

(b) Reserves and Surplus 2 (3,24,00,000) 56,00,000

(2) Non-Current Liabilities:

(a) Secured Loans 3 3,20,00,000 1,60,00,000

(b) Unsecured Loans 4 1,72,00,000 -

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(3) Current Liabilities:

(a) Trade Payables 56,00,000 36,00,000

(b) Other Current Liabilities 5 2,04,00,000 56,00,000

Total 5,08,00,000 3,28,00,000

II. Assets:

(1) Non-Current Assets:

Property, Plant & Equipment 68,00,000 1,36,00,000

(2) Current Assets:

(a) Inventories 3,68,00,000 -

(b) Other Current Assets 72,00,000 1,92,00,000

Total 5,08,00,000 3,28,00,000

Notes to Accounts: Aakash Limited Ganga Limited

1. Share Capital

Authorized, Issued, Subscribed & Paid up :

6,00,000 Equity Shares of Rs.10 each 60,00,000 -

20,000 Preference Shares of Rs. 100 each 20,00,000 -

2,00,000 Equity Shares of Rs. 10 each - 20,00,000

80,00,000 20,00,000

2. Reserves and Surplus

General Reserve 8,00,000 56,00,000

Surplus (3,32,00,000) -

(3,24,00,000) 56,00,000

3. Secured Loans

(Secured Loans of Aakash Limited are

secured against pledge of Inventories) 3,20,00,000 1,60,00,000

4. Unsecured Loans 1,72,00,000 -

5. Other Current Liabilities

Statutory Liabilities 1,44,00,000 20,00,000

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Liability to Employees 60,00,000 36,00,000

2,04,00,000 56,00,000

Both the companies go into liquidation and a new company ‘AakashGanga Limited’ is formed

to take over their business. The following information is given:

(i) All Current Assets of two companies, except pledged inventory are taken over by Aakash

Ganga Limited. The realizable value of all the Current Assets (including pledged inventory) is

80% of book value in case of Aakash Limited and 70% for Ganga Limited.

(ii) Property, Plant and Equipment of both the companies are taken over at book value by

AakashGanga Limited.

(iii) Secured Loans include Rs. 32,00,000 accured interest in case of Ganga Limited.

(iv) 4,00,000 Equity Shares of Rs. 10 each are allotted by AakashGanga Limited at par against

cash payment of entire face value to the shareholders of Aakash Limited and Ganga Limited in

the ratio of shares held by them in Aakash Limited and Ganga Limited.

(v) Preference Shareholders in Aakash Limited are issued Equity Shares in AakashGanga Ltd.

worth Rs. 4,00,000 in lieu of their present holdings.

(vi) Secured Loan agree to continue the balance amount of their loans to AakashGanga Limited

after adjusting realizable value of pledged asset in case of Aakash Limited and after waiving

50% of interest due in the case of Ganga Limited.

(vii) Unsecured Loans are taken over by AakashGanga Limited at 25% of loan amounts.

(viii) Employees are issued fully paid Equity Shares in AakashGanga Limited in full settlement

of their dues.

(ix) Statutory Liabilities are taken over by AakashGanga Limited at full value and Trade

Payables are taken over at 80% of the book value.

You are required to prepare the opening Balance Sheet of AakashGanga Limited as at 1.4.2021.

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5. a) Chand Ltd. and its subsidiary Sitara Ltd. provided the following information for the year ended

31st March, 2023:

Particulars Chand Ltd (₹) Sitara Ltd. (₹)

Equity Share Capital 20,00,000 6,00,000

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Finished Goods Inventory as on 01.04.2022 4,20,000 3,01,000

Finished Goods Inventory as on 31.03.2023 8,57,500 3,76,250

Dividend Income 1,68,000 43,750

Other non-operating Income 35,000 10,500

Raw material consumed 13,93,000 4,72,500

Selling and Distribution Expenses 3,32,500 1,57,500

Production Expenses 3,15,000 1,40,000

Loss on sale of investments 26,250 Nil

Sales and other operating income 33,25,000 19,07,500

Wages and Salaries 13,30,000 2,45,000

General and Administrative Expenses 2,80,000 1,22,500

Royalty paid Nil 5,000

Depreciation 31,500 14,000

Interest expense 17,500 5,250

Other information

• On 1st September 2020 Chand Ltd., acquired 5,000 equity shares of ₹ 100 each fully paid up

in Sitara Ltd.

• Sitara Ltd. paid a dividend of 10% for the year ended 31st March 2022. The dividend was

correctly accounted for by Chand Ltd.

• Chand Ltd. sold goods of ₹ 1,75,000 to Sitara Ltd. at a profit of 20% on selling price.

Inventory of Sitara Ltd. includes goods of ₹ 70,000 received from Chand Ltd.

• Selling and Distribution expenses of Sitara Ltd. include ₹ 21,250 paid to Chand Ltd. as

brokerage fees.

• General and Administrative expenses of Chand Ltd. include ₹ 28,000 paid to Sitara Ltd. as

consultancy fees.

• Sitara Ltd. used some resources of Chand Ltd., and Sitara Ltd. paid ₹ 5,000 to Chand Ltd. as

royalty.

• Consultancy fees, Royalty and brokerage received is to be considered as operating

revenues.

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Prepare Consolidated Statement of Profit and Loss of Chand Ltd. and its subsidiary Sitara Ltd.

for the year ended 31st March, 2023 as per Schedule III to the Companies Act, 2013.

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b) X Ltd. had ₹ 1,00,000 equity share capital divided into 1,000 shares of ₹ 100 each out of which ₹

80 per share was called up and paid up. It has 1,500 cumulative preference shares of ₹ 100 each

fully paid up. Intangible assets include Goodwill of ₹ 80,000 and patents of ₹ 27,800.

Preference dividends are in arrears of ₹ 33,000.

You are required to show the entries (Ignore dates) under each of the following conditions:

(i) If X Ltd. resolves to subdivide the equity shares into 10,000 equity shares of ₹ 10 each of

which ₹ 8 per share is called up and paid up.

(ii) If X Ltd. resolves to convert its 1,000 equity shares of ₹ 100 each (assume fully - paid)

into ₹ 1,00,000 worth of stock.

(iii) The preference shares are to be converted into 11% unsecured debentures of ₹ 100

each (including arrears of dividends).

(iv) Patents and Goodwill to be written-off

6. a) Milk Ltd. entered into an agreement with Curd Ltd. for sale of goods of Rs. 8 lakhs at a profit of

20% on cost. The sale transaction took place on 1st February, 2017. On the same day Curd Ltd.

entered into another agreement with Milk Ltd. to resell the same goods at Rs. 10.80 lakhs on 1st

August, 2017. State the treatment of this transaction in the financial statements of Milk Ltd. as

on 31.03.2017. The pre-determined reselling price covers the holding cost of Curd Ltd. Give the

Journal Entries as on 31.03.2017 in the books of Milk Ltd.

OR

b) ABC Builders Limited had borrowed a sum of US $ 15,00,000 at the beginning of Financial year

2020- 21 for its residential project at London Interbank Offered Rate (LIBOR) + 4 %. The interest

is payable at the end of the Financial Year. At the time of availing the loan, the exchange rate

was ₹ 72 per US $ and the rate as on 31st March, 2021 was ₹ 76 per US $. If ABC Builders

Limited borrowed the loan in Indian Rupee equivalent, the pricing of loan would have been

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9.50%. Compute Borrowing Cost and exchange difference for the year ending 31st March, 2021

as per applicable Accounting Standards

c) A trader commenced business on April 1, 2020 with ₹ 120,000, represented by 6000 units of a

certain product at ₹ 20 per unit. During the year 2020-21 he sold these units at ₹ 30/- per unit

and had withdrawn ₹ 60,000. The price of the product at the end of financial year was ₹ 25/- per

unit. Compute retained profit of the trader under the concept of physical capital maintenance at

current cost. Also, state, whether answer would be different if the trader had not withdrawn

any amount.

d) M/s Shrikant operates a number of retail outlets to which goods are invoiced at wholesale price

which is cost plus 25%. These outlets sell the goods at the retail price which is wholesale price

plus 20%.

Following is the information regarding one of the outlets for the year ended 31.3.2024:

Stock at the outlet 1.4.2023 Rs. 45,000

Goods invoiced to the outlet during the year Rs. 4,86,000

Gross profit made by the outlet Rs. 90,000

Goods lost by fire ?

Expenses of the outlet for the year Rs. 30,000

Stock at the outlet 31.3.2024 Rs. 54,000

You are required to prepare the following accounts in the books of M/s Shrikant for the year

ended 31.3.2024: [a] Outlet Stock Account [b] Outlet Profit & Loss Account

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