LLOYD INSTITUTE OF MANAGEMENT AND TECHNOLOGY

GREATER NOIDA
SUBJECT- COMPANY ACCOUNTS
BBA- 3rd SEMESTER, PRE-UNIVERSITY TEST
TIME-3 Hrs.

PAPER CODE- BBA 305

Max Marks- 75

Note: Attempt all the sections as per instructions.

SECTION-A

3*5=15 MARKS

Attempt all five questions. Each question carries marks. Very short is required not exceeding
75 words:
Q1) What is Company?
Q2) Define forfeited shares account.
Q3) What do you mean by absorption of companies?
Q4) What is holding company?
Q5) Explain liquidation of companies.
SECTION-B

7.5*2=15 MARKS

Attempt any two questions out of the following 3 questions. Each question carries 7.5 marks.
Short answer is required not exceeding 200 words:
Q6) Write a short note on equity shares.
Q7) What are three major points of liquidator remuneration?
Q8) Anthony Company Ltd., purchased 8,000 equity shares of Canning Company Ltd., on 1st
Jan., 2009. The balance sheets of both the companies as at 31st Dec., 2009 stood as follows:
Liabilities
Equity share of
Rs.100 each
General Reserve
P&L A/c
Profit for the year
Sundry Creditors

Anthony Canning
Ltd.
Ltd.
20,00,00 10,00,000
0
2,00,000
4,00,000
60,000
1,00,000
80,000
2,00,000
1,00,000
1,00,000

Bills Payable
30,000
28,30,00
0

Assets
Land & Building

Plant & Machinery

Stock
Sundry Debtors
Investment in
shares of Canning
& Co. Ltd.
10,000 Bills Receivable
Cash and Bank

14,50,000

Anthony
Ltd.
5,00,000

Canning
Ltd.
3,00,000

5,00,000
1,50,000
1,00,000
10,00,000

6,00,000
1,00,000
1,20,000
-

80,000
5,00,000

10,000
3,20,000

28,30,000

14,50,000

(a) B/R of Anthony Co. Ltd. Includes Rs. 10,000 accepted by Canning Co. Ltd.

(b) Sundry debtors of Anthony & Co. Ltd. Includes Rs. 50,000 due from Canning Co. Ltd.
(c) Stock of Canning Co. Ltd. Includes goods purchased from Anthony & Co. Ltd. For Rs.
60,000 which where invoiced by Anthony Co. Ltd. At a profit of 25% on cost.
SECTION-C

15*3=45 MARKS

Attempt any three questions out of the following 5 questions. Each question carries 15 marks.
Answer is required in detail.
Q9) ABC ltd., was registered with a nominal capital of Rs. 6, 00,000 divided into shares of
Rs 10 each. It purchased a building from Z for Rs. 2, 00,000 payable in fully paid up shares
of the company. The remaining 40,000 shares were offered to the public, payable as follows:
Rs. 3 on application; Rs. 3 on allotment; Rs. 2 on first call and Rs. 2 on final call.
All the shares were subscribed and allotted. Rajesh, who holds 400 shares failed to pay both
the calls and his shares were forfeited. These shares were later re-issued to Shyam at Rs.8.50
per share as fully paid up.
Record the above in the companys Journal and prepares a balance sheet.
Q10) What is a profit and loss appropriation account? How does it differ from profit and loss
account?
Q11) The balance sheet of Star Ltd. and Moon Ltd. As on 31st December, 2005 are as under:
Liabilities

Star Ltd.
(Rs.)
Equity Shares of 2,10,000
Rs. 10 each
12% Pref. shares 90,000
of Rs.100 each
Securities
10,500
Premium
60,000
Capital
Redemption
Reserve
49,500
General Reserve
60,000
11% Debentures
1,20,000
Creditors
6,00,000

Moon Ltd.
Assets
(Rs.)
1,50,000
Goodwill

Star Ltd.
(Rs.)
15,000

Moon Ltd.
(Rs.)
-

Land & Building

1,05,000

Plant
Fixtures
Vehicles
Stocks
Debtors
Advances
Cash & Bank

3,00,000
5,000
10,000
1,20,000
80,000
50,000
20,000

1,35,000
15,000
15,000
75,000
50,000
35,000
20,000

6,00,000

4,50,000

75,000
90,000
1,35,000

4,50,000

On 1st January, 2005, Sun Ltd. was formed by amalgamation Star Ltd. And Moon Ltd. On the
following terms:
(a) Sun Ltd. To issue 60, 14% debentures of Rs. 1,000 each to debenture holders of Star Ltd.
(b) The debenture holders of Moon Ltd. Insisted that they should allotted equity shares in
Sun Ltd. accordingly, they were allotted 7,500 equity shares of Rs 10 each of Rs 12 per
share.
(c) Preference shareholders of Star ltd. insisted for allotment of 900, 13% redeemable
preference shares Rs 100 each.
(d) The equity shareholders of Star Ltd. are to be allotted 10 equity shares at par 7 equity
shares held by them. The shares of star Ltd. are of Rs 10 each.
(e) The assets of Star Ltd. are taken over at book value.
(f) The assets and liabilities of Moon Ltd. are valued as under.

Goodwill Rs 30,000; Land Rs 1,50,000; Building Rs 45,000; Plant Rs 1,20,000; Other fixed
assets Rs 15,000; All current assets Rs 1,50,000; all current liabilities Rs 1,50,000.

The balance of consideration is to be paid by allotment of equity shares at par to Moon Ltd.
You are required to show:
(i)
(ii)
(iii)

Purchase consideration payable to Star ltd. and Moon Ltd.

Opening entries in the books of Sun Ltd.
Balance Sheet of Sun Ltd.

Q12) What is consolidated financial statements? Define objectives and scope of consolidated
financial statements.
Q13) Discuss the order of payment of liquidator. Also give the Performa of Liquidators final
statement of account.