Q.

1 – Convert the Above Balance Sheet into Vertical Format & Calculate -

1. Current Ratio.
2. Quick Ratio / Liquid Ratio.
3. Super Quick Ratio.
4. Capital.
5. Debit Equity Ratio.
6. Stock Working Capital Ratio.
7. Proprietary Ratio.

Liabilities Amount Assets Amount

12% Pref. Share Capital (1,00,000 X Rs.
10) 10,00,000 Goodwill 2,00,000
Equity Share Capital (1,00,000 X Rs. 10) 10,00,000 Patent & Trademark 1,00,000
General Reserve 4,00,000 Copyright 1,00,000
Security Premium 6,00,000 Investment Nil
Capital Reserve 3,00,000 Land & Building 20,00,000
Capital Redemption Reserve 1,00,000 Pant & Machinery 5,00,000
12% Debenture 10,00,000 Motor Vehicles 5,00,000
14% Loan From IDBI 5,00,000 Sundry Debtors 1,00,000
15% Loan From ICICI 4,00,000 Bills Receivable 90,000
Sundry Creditor 60,000 Closing Stock 1,00,000
Bills Payable 40,000 Cash In Hand 50,000
Bank Overdraft 1,00,000 Cash At Bank 50,000
Prepaid Expenses 10,000

Total Rupees 55,00,000/- 55,00,000/-

M.S.T.
 Ans. – Vertical Balance Sheet as on 31st Dec. 2009 -

  Particulars Amount Amount Amount

  Source Of Fund Or Fund Employed By      
A Capital      
1 Share Holders/ Owners/Proprietors Fund      
a Authorized Capital    Nil  
b Issued & Paid-Up Capital      
i 12% Preference Share Capital (1,00,000 Of Rs. 10 Each) 10,00,000    
ii Equity Share Capital (1,00,000 Of Rs. 10 Each) 10,00,000    
      20,00,000  
2 Add- Reserve & Surpluses      
i General Reserved 4,00,000    
ii Security Premium 6,00,000    
iii Capital Reserve 3,00,000    
iv Capital Redemption Reserve 1,00,000    
      14,00,000  
        34,00,000
B Loan Or Borrowed Fund      
1 Secured Loan      
i 12% Debentures 10,00,000    
ii 14% Loan From IDBI 5,00,000    
iii 15% Loan From ICICI 4,00,000    
      19,00,000  
2 Unsecured Loan Nil Nil  
        19,00,000
  Total Sources Of Fund     53,00,000
         
  Application Of Fund Or Fund Employed As      
         
a Fixed Assets      
1 Intangible      
i Goodwill 2,00,000    
ii Patent & Trademark 1,00,000    
iii Copy Right 1,00,000    
iv Leasehold Rights Nil    
      4,00,000  
2 Tangible      
i Land & Building 20,00,000    
ii Plant & Machinery 22,00,000    
iii Motor Vehicles 5,00,000    
      47,00,000  
        51,00,000

M.S.T.
  

b Investment     Nil
         
c Net Current Asset Or Working Capital      
1 Current Assets      
i Sundry Debtors 1,00,000    
ii Bill Receivable 90,000    
iii Closing Stock 1,00,000    
iv Cash In Hand 50,000    
v Cash In Bank 50,000    
vi Prepaid Expenses 10,000    
      4,00,000  
        55,00,000
2 Less - Current Liabilities      
i Sundry Creditor 60,000  
ii Bank Payable 40,000  
iii Bank Overdraft 1,00,000  
      2,00,000
   Total Application Of Fund     53,00,000

M.S.T.
 Q. 2 - Rearrange the Above Balance Sheet in the Form Suitable For Analysis &

Calculate the Following –

1. Total Found Employed.

2. Proprietors Found.
3. Long-Term Liabilities.
4. Current Liabilities.
5. Fixed Assets.
6. Current Assets.
7. Quick Assets.
8. Working Capital.
9. Fictitious Assets.

Liabilities Amount Assets Amount2

Paid Up Share Capital 4,75,000 Factory Premises 2,25,000
Capital Redemption Reserve 3,25,000 Pant & Machinery 1,74,586
Profit & Loss A/C 12,929 Motor Vehicles 35,520
Sundry Creditor 25,515 Stock 52,320
Outstanding Wages 6,415 Debtors 45,790
Provision For Taxation 8,950 Cash 16,595
    Taxes Paid In Advance 3,998
    Preliminary Expenses 7,500
Total Rupees 5,61,309   5,61,309

M.S.T.
 Ans. – Vertical Balance Sheet as on 31st September. 2005 –

Particular Amount Amount Amount

Application Of Funds
1 Fixed Assets
i Factory Premises 2,25,000
ii Plant & Machinery 1,74,586
iii Motor Car 35,520
4,35,106
2 Investment Nil
3 Net Current Assets
A Current Assets
i Cash 16,595
ii Stock 52,320
iii Debtors 45,790
iv Taxes Paid In Advances 3,998
1,18,703
B Less- Current Liabilities & Provision
i Sundry Creditor 25,515
ii Outstanding Wages 6,415
iii Provision For Taxation 8,950
40,880
77,823
Net Assets Employed 5,12,929
Sources Of Fund
i Share Capital 4,75,000
ii Reserves 32,500
iii Profit & Loss A/C 12,929
5,20,429
iv Less- Preliminary Expenses 7,500
Proprietors Fund 5,12,929
Thus,
1. Total Fund Employed - 5, 12,929.
2. Proprietors Fund - 5, 12,929.
3. Long-Term Liabilities - Nil.
4. Current Liabilities - 40,880.
5. Fixed Assets - 4, 35,106.
6. Current Assets - 1, 18,703.
7. Quick Assets = Current Assets – Stock – Advance Tax
= 1, 18,703 – 52,320 – 3998
M.S.T.
 = 62,385.
8. Working Capital - 77,823.
9. Fictions Assets (Preliminary Expenses) - 7,500.

Q.3 – Rearrange the Above Balance Sheet in A Form Suitable For Analysis &
Calculate the Following,-
1. Current Assets.
2. Quick Assets.
3. Intangible Assets.
4. Fictitious Assets.
5. Fixed Assets.
6. Fixed Liabilities.
7. Proprietor Fund.
8. Working Capital.
9. Total Funds Employed.
10.Secured Loan.
11.Owned Fund.

Liabilities Amount Assets Amount

Share Capital 7,50,000 Goodwill 1,25,000
Capital Reserve 1,500 Land 1,29,000
General Reserve 1,20,410 Premises  
Leasehold Redemption Fund 42,500 Plant 2,34,395
Profit & Loss A/C 13,777 Furniture 8,575
5% Debentures 1,57,500 3% G. P. Notes 71,400
Sundry Creditor 73,900 Stock 1,96,770
Proposed Creditor 75,000 Debtors 2,03,942
Provision For Taxation 25,000 Cash At Bank 1,20,280
    Advance Tax 23,675
    Preliminary Expenses 1,550
Total Rupees 12,64,587   12,64,587

M.S.T.
 Ans. – Vertical Balance Sheet as on 31st Dec. 2004 –

Particulars Amount Amount Amount

I Source Of Funds Or Fund Employed By
A Share Holders/ Owners/Proprietors Fund
i Share Capital 7,50,000
ii Capital Reserve 1,500
iii General Reserved 1,20,410
iv Leasehold Redemption Fund 42,500
v Profit & Loss A/C 18,777
9,33,187
B Less- Preliminary Expenses 1500
9,31,637
C Loan or borrowed Fund
i 5% Debentures 1,57,500
Total Resources 10,89,137

II Application Of Fund
A Fixed Assets
i Goodwill 1,25,000
ii Land 1,29,000
iii Premises 1,50,000
iv Plant 2,34,395
v Furniture 8,575
6,46,970
B Investment (3% G.P. Notes) 71,400

C Net Current Assets

i Stock 1,96,770
ii Debtors 2,03,942
iii Cash At Bank 1,20,280
iv Advance Tax 23,675
5,44,667
12,63,037
D Less- Current Liabilities
i Sundry Creditors 73,900
ii Proposed Dividend 75,000
iii Provision For Taxation 25,000
1,73,900
1,73,900
Total Funds Utilized 10,89,137
M.S.T.
 Thus,
1. Current Assets - 5,44,667
2. Quick Assets (Current Assets Less Stock & Advance Tax) - 3,24,222
3. Intangible Assets (Goodwill) - 1,25,000
4. Fictitious Assets (Preliminary Expenses) - 1,550
5. Fixed Assets - 6,46,970
6. Fixed Liabilities - 1,57,500
7. Proprietor Fund - 9,31,637
8. Working Capital (Current Assets Less Current Liabilities) - 3,70,767
9. Total Funds Employed - 10,89,137
10.Secured Loan - 1,57,500
11.Owned Fund - 1,57,500

M.S.T.
 Q. 4 – From the following particulars of a ltd. Prepare balance sheet in horizontal format

As well as vertical format as on 31-12-2008.

Particular Debit Credit

1 Share Capital
2 11% Preference Share Of Rs. 10 Each 10,00,000
3 Equity Share Of Rs. 10 Each 20,00,000
4 Securities Premium Etc 6,00,000
5 Development Reserve 1,00,000
6 14% Debentures 4,00,000
7 Profit & Loss A/C 3,00,000
8 Goodwill A/C 3,00,000
9 Patent & Trademark 1,00,000
1
0 Plant & Machinery 1,00,000
1
1 Land & Building 10,00,000
1
2 Motor Vehicle 22,00,000
1
3 Stock 11,00,000
1
4 Debtor 60,00,000
1
5 Bill Receivable 20,000
1
6 Bank Of India 20,000
1
7 Bank Of Baroda 40,000
1
8 Cash In Hand 60,000
1
9 Bill Payable 1,00,000
2
0 Bank Overdraft 60,000
2
1 Creditor 20,000
20,000
Total Rupees 48,00,000 48,00,000
M.S.T.
 Ans.- Vertical Sheet As On 31st December 2008 -
Particulars Amount Amount Amount
Source Of Fund Or Fund Employed By
A Capital
 1 Share Holders/ Owners/Proprietors Fund
i Authorized Capital
ii Issued & Paid-Up Capital
a 11% Preferred Share Capital Of Rs. 10 Each 10,00,000
b Equity Share Capital Of Rs. 10 Each 20,00,000
30,00,000
2 Add- Reserve & Surpluses
i Security Premium 6,00,000
ii Development Reserve A/C 1,00,000
iii General Reserved A/C 3,00,000
iv Profit & Loss A/C 3,00,000
13,00,000
43,00,000
B Loan Or Borrowed Fund
1 Secured Loan
a 14% Debentures 4,00,000

2 Unsecured Loan Nil Nil

4,00,000
Total Sources Of Fund 47,00,000

Application Of Fund Or Fund Employed As

A Fixed Assets
1 Intangible
M.S.T.
 i Goodwill 1,00,000
ii Patent & Trademark 1,00,000
2,00,000
2 Tangible
i Plant & Machinery 10,00,000
ii Land & Building 22,00,000
iii Motor Vehicles 11,00,000
43,00,000
45,00,000
B Investment Nil
C Current assets ,loans &advances
i Stock 60,000
ii Debtor 20,000
iii Bill Receivable 20,000
iv Bank Of India 40,000
v Bank Of Baroda 60,000
vi Cash In Hand 1,00,000
3,00,000
48,00,000
D less-Current Liabilities & Provision
i Creditor 20,000
ii Bill Payable 60,000
iii Bank Overdraft 20,000
1,00,000
47,00,000

M.S.T.
 Q. 5 – From the following particulars of a ltd. Prepare balance sheet in horizontal format

As well as vertical format as on 31-03-2009.

Particular Debit Credit

1 Goodwill 2,00,000
2 Land &Building 1,00,000
3 Plant & Machinery 6,00,000
4 Motor Vehicle 4,00,000
5 Patent & Trademark 2,00,000
6 Leasehold Right 2,00,000
7 Profit & Loss A/C 2,00,000
8 Preliminary Expenses 1,00,000
9 Equity Share Capital 20,00,000
10 9% Preference Expenses 6,00,000
11 Securities Premium 4,00,000
12 Development Reserve 6,00,000
13 Stock 3,00,000
14 Debtor 4,00,000
15 Bill Receivable 2,00,000
16 Cash In Hand 2,00,000
17 Bank Of India 1,00,000
18 Bank Of Baroda 1,00,000
19 Bill Payable 2,00,000
20 Bank Overdraft 3,00,000
M.S.T.
 Total Rupees 42,00,000 42,00,000

Ans. – Vertical Balance Sheet as on 31st March 2009 –

Particulars Amount Amount Amount

Source Of Fund Or Fund Employed By
I Capital
1 Share Holders/ Owners/Proprietors Fund
A Authorized Capital Nil
B Issued & Paid-Up Capital 20,00,000
i 9% Preferred Share Capital 6,00,000
26,00,000
B Add- Reserve & Surpluses
i Security Premium 4,00,000
ii Development Reserve 6,00,000
10,00,000
36,00,000
i Less- Profit & Loss A/C 2,00,000
ii Preliminary Expenses 1,00,000
3,00,000
33,00,000
2 loan or borrowed fund
A Secured Loan Nil

B Unsecured Loan Nil

Sources Of Fund 33,00,000

Application Of Fund Or Fund Employed As

M.S.T.
 A Fixed Assets
1 Intangible
I Goodwill 2,00,000
ii Patent & Trademark 2,00,000
iii Leasehold Rights 2,00,000
6,00,000
2 Tangible
I Land & Building 11,00,000
ii Plant & Machinery 6,00,000
iii Motor Vehicles 4,00,000
1,00,000
21,00,000
27,00,000
B Investment Nil
C Net Current Assets or Working Capital
1 Current Assets
i Stock 3,00,000
ii Debtor 4,00,000
iii Bill Receivable 2,00,000
iv Cash In Hand 2,00,000
V Bank Of India 1,00,000
12,00,000
39,00,000
2 Less- Current Liabilities & Provision
I Bill Payable 2,00,000
ii Creditor 3,00,000
iii Bank of Baroda 1,00,000
6,00,000
Total Application Of Fund 33,00,000

M.S.T.
 Q. 6 – from the following horizontal balance sheet convert into vertical balance sheet as on
31st December 2007.

Amoun
Liabilities t Assets Amount
Share Capital   Goodwill 2,00,000
11% Pref. Share Capital 20,00,000 Land & Building 20,00,000
Equity Share Capital 30,00,000 Plant & Machinery 10,00,000
General Reserve 4,00,000 Motor Vehicles 6,00,000
Capital Reserve 3,00,000 Leasehold Right 3,00,000
Security Premium 4,00,000 Stock 2,00,000
Sundry Creditor 1,00,000 Cash In Hand 3,00,000
Bills Payable 1,00,000 Bill Received 2,00,000
Bank Overdraft 1,00,000 Sundry Debtors 3,00,000
    SBI A/C 4,00,000
    Bank Of Baroda 6,00,000
Preliminary Expenses 3,00,000
Total Rupees 64,00,000   64,00,000

M.S.T.
 Ans. – Vertical Balance Sheet as on 31st December 2007 –

Particulars Amount Amount Amount

Source Of Fund Or Fund Employed By
I Capital
1 Share Holders/ Owners/Proprietors Fund
A Authorized Capital
B Issued & Paid-Up Capital
i 11% Preferred Share Capital 20,00,000
ii Equity Share Capital 30,00,000
50,00,000
2 Add-Reserve & Surpluses
ii General Reserved 4,00,000
ii Capital Reserved 3,00,000
iii Security Premium 4,00,000
11,00,000

i Less-Preliminary Expenses 3,00,000 3,00,000

58,00,000
II Loan or Borrowed Fund
i Secured Loan Nil

M.S.T.
 ii Unsecured Loan Nil
Nil
Total Sources Of Fund 58,00,000

Application Of Fund Or Fund Employed As

A Fixed Assets
1 Intangible
i Goodwill 2,00,000
ii Leasehold Rights 3,00,000
5,00,000
2 Tangible
i Land & Building 20,00,000
ii Motor Vehicles 6,00,000
iii Plant & Machinery 10,00,000
36,00,000
41,00,000

B Investment Nil

C Net Current Assets or Working Capital

1 Current Assets
i Stock 2,00,000
ii Cash In Hand 3,00,000
iii Bill Receivable 2,00,000
iv Sundry Debtor 3,00,000
v SBI A/C 4,00,000
vi Bank Of Baroda A/C 6,00,000
20,00,000
61,00,000
2 Less- Current Liabilities & Provision
i Sundry Creditor 1,00,000
ii Bill Payable 1,00,000
iii Bank Overdrafts 1,00,000
3,00,000
Total Application Of Fund 58,00,000

M.S.T.