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FINANCIAL STATEMENTS OF LISTED, QUOTED COMPANIES |
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Financial
Accounting (Mgt-101)
VU
Lesson-43
FINANCIAL
STATEMENTS OF LISTED/QUOTED
COMPANIES
According
to Companies Ordinance 1984, the
arrangement of financial statements is as
follows:
· Balance
Sheet
· Profit
and Loss Account
· Cash
Flow Statement
· Statement
of changes in Equity
· Notes
to the Accounts
For
the sake of presentation same order
should be followed while solving the
questions. But we cannot
complete
the balance sheet without
first preparing the Profit and
Loss Account. To solve the
problem in
exam
situation we usually prepare the forms of
Balance Sheet and Profit
and Loss Account first. This
way
we can
also plan the Serial Numbers of
Notes to the Accounts beforehand. Otherwise a
sheet of question
paper
can be left blank for
preparation of Balance Sheet.
Comparative
figures are also included in the
financial statements for every figure,
except where first set
of
financial
statements is being prepared. In examination
situation comparative figures should be
shown
provided
these are provided in the
question.
QUESTION
Following
is the trial balance of Alfa
Ltd. For the year ended
June 30, 2002. You
are also given the
balance
sheet
of June 30, 2001.
REQUIRED
You
are required to prepare a set of
financial statements of the Alfa
Ltd.
Alfa
Ltd.
Trial
Balance for the Year
June 30, 2002
Debit
Credit
Rs.
Rs.
Fixed
Assets at Cost
Freehold
Land
500,000
Building
600,000
Furniture
and Fixture
400,000
Vehicles
930,000
Accumulated
Depreciation
Building
150,000
Furniture
and Fixture
150,000
Vehicles
300,000
Sundry
Debtors
80,000
Advances,
Deposits and
Prepayments
26,000
Investments
(Long Term)
105,000
Cash
in hand
2,000
Cash
at bank
75,500
Purchases
500,000
Sales
Return
10,000
Stock
July 01, 2001
85,000
274
Financial
Accounting (Mgt-101)
VU
Salaries
(Admin. Staff)
65,000
Rent,
Rates and Taxes
12,500
Carriage
inward
8,000
Legal
Charges
7,500
Salaries
(Sales Staff)
45,000
Selling
Expenses
23,000
Financial
Charges
45,000
Sundry
Creditors
50,500
Short Term
Running Finance
175,000
Advances
from Customers
28,500
General
Reserve
250,000
Tax
Payable
35,500
Accumulated
Profit Brought
Forward
90,000
Sales
857,200
Markup
on Investments
15,000
Purchase
Return
12,800
Loan
from Bank (Long Term)
655,000
Issued
Share Capital
750,000
TOTAL
3,519,500
3,519,500
Additional
information:
· The
authorized capital of the company is Rs.
1,000,000 divided into
100,000 shares of Rs. 10
each.
· Additions
made in Fixed Assets include
Building Rs. 75,000 and
Furniture and Fixture Rs.
50,000.
These
have already been recorded
in the books of accounts.
· Depreciation
is to be charged on Building 5%,
Furniture and Fixture @ 10%
and Vehicles 20% on
written
down value. Full year,s
depreciation is charged in the year of
purchase whilst no depreciation
is
charged in the year of
disposal.
· Provision
for doubtful debts to be
created Rs. 5,000.
· Stock
on June 30, 2002 Rs.
65,000
· Provide
Rs. 9,800 for income
tax.
275
Financial
Accounting (Mgt-101)
VU
Alfa
Ltd.
Balance
Sheet as at June 30,
2001.
Note
2001
Operating
Fixed Assets
1,705,000
Investments
55,000
1,760,000
Current
Assets
Sundry
Debtors
65,900
Stock
in Trade
85,000
Advances,
Deposits and
Prepayments
21,500
Cash
in hand
1,500
Cash
at bank
58,600
232,500
Current
Liabilities
Sundry
Creditors
65,200
Short Term
Running Finance
125,500
Tax
Payable
42,000
Advances
from Customers
19,800
252,500
Working
Capital
(20,000)
Net
Capital Employed
1,740,000
Financed
by
Share
Capital and Reserves
Authorized
Capital
100,000
shares of Rs. 10
each.
1,000,000
Share
Capital
75,000
(2001: 60,000) shares of Rs.
10 each
600,000
General
reserve
250,000
Un-appropriated
Profit
90,000
Total
Share holders
Equity
940,000
800,000
Long
Term Loans
Total
1,740,000
SOLUTION
276
Financial
Accounting (Mgt-101)
VU
Alfa
Ltd.
Balance
Sheet as at June 30,
2002.
Note
2002
2001
Operating
Fixed Assets
1
1,656,500
1,705,000
Investments
105,000
55,000
1,761,500
1,760,000
Current
Assets
Sundry
Debtors
65,900
80,000
Stock
in Trade
65,000
85,000
Advances,
Deposits and
Prepayments
26,000
21,500
Cash
in hand
2,000
1,500
Cash
at bank
75,500
58,600
248,500
232,500
Current
Liabilities
Sundry
Creditors
50,500
65,200
Short Term
Running Finance
175,000
125,500
Tax
Payable
2
45,300
42,000
Advances
from Customers
28,500
19,800
299,300
252,500
Working
Capital
(50,800)
(20,000)
Net
Capital Employed
1,710,700
1,740,000
Financed
by
Share
Capital and Reserves
Authorized
Capital
100,000
shares of Rs. 10
each.
1,000,000
1,000,000
Share
Capital
75,000
(2001: 60,000) shares of Rs.
10 each
750,000
600,000
General
reserve
250,000
250,000
Un-appropriated
Profit
55,700
90,000
Total
Share holders
Equity
1,055,700
940,000
655,000
800,000
Long
Term Loans
TOTAL
1,710,700
1,740,000
PROFIT
AND LOSS ACCOUNT
Alfa
Ltd.
277
Financial
Accounting (Mgt-101)
VU
Profit and
Loss Account for the
year ended June 30,
2002.
Note
2002
2001
Rs.
Rs.
Net
Sales
3
847,200
x
Less:
Cost of Goods Sold
4
515,200
x
Gross
Profit
332,000
x
Add:
Other Income
15,000
x
347,000
x
Less:
Administrative
Expenses
5
258,500
x
Selling
Expenses
6
68,000
x
326,500
x
Operating
Profit
20,500
x
Less:
Financial Charges
45,000
x
Net
Profit / (Loss) Before
Tax
(24,500)
x
Less:
Provision for Tax
9,800
x
Net
Profit / (Loss) After
Tax
(34,300)
x
Accumulated
Profit / (Loss) Brought
Forward
90,000
x
Accumulated
Profit / (Loss) Carried
Forward
55,700
x
278
Financial
Accounting (Mgt-101)
VU
Alfa
Ltd.
Cash
Flow Statement for the
year ended June 30,
2002
Note
2002
2001
Cash
Flow From Operating
Activities
Profit
/ (Loss) Before Tax
(24,500)
Adjustment
for: Depreciation
173,500
Operating
Profit Before Working Capital
changes
149,000
(Increase)
/ Decrease in C. Assets
Sundry
Debtors
(14,100)
Stock
in Trade
20,000
Advances,
Deposits and
Prepayments
(4,500)
1,400
Increase
/ (Decrease) in C. Liabilities
Sundry
Creditors
(14,700)
Short Term
Running Finance
49,500
Advances
from Customers
8,700
43,500
Cash
Generated From Operations
193,900
Income
Tax Paid
(6,500)
Net
Cash Flow from
Operations
187,400
Cash
Flow From Investing
Activities
Building
(75,000)
Furniture
and Fixture
(50,000)
Investments
(Long Term)
(50,000)
Net
Cash Flow From Investing
Activities
(175,000)
Cash
Flow from financing
Activities
Share
Capital Issued
150,000
Long
Term Loan Repaid
(145,000)
5,000
Net
Increase in Cash & Cash
Equivalents
17,400
O/B of
Cash and Cash
Eq.
60,100
C/B of
Cash and Cash
Eq.
77,500
279
Financial
Accounting (Mgt-101)
VU
280
Financial
Accounting (Mgt-101)
VU
Alfa
Ltd.
Statement
of Changes in Equity for the
Year Ended June 30,
2002
Share
General
Un-app.
Total
Capital
Reserve
Profit
Balance
as on June 30, 2000
x
x
x
x
Profit
after tax for the year
x
x
Dividend
(x)
(x)
Balance
as on June 30, 2001
600,000
250,000
90,000
940,000
150,000
Shares
Issued
150,000
Profit
after tax for the year
(34,300)
34,300
750,000
250,000
55,700
1,055,700
NOTES
TO THE ACCOUNTS
Note
# 1
Fixed
Assets at WDV
Cost
R
Accumulated
Depreciation
WDV
Particulars
As
On
As
On
A
As
On
On
For
As
On
As
On
Jul
01
Add.
Disp.
Jun
01
T
Jul
01
Disp.
The
Jun
01
Jun
01
2001
2002
E
2001
Year
2002
2002
Freehold
Land
500,000
-
-
500,000
-
-
-
-
-
500,000
Building
525,000
75,000
-
600,000
5
150,000
-
22,500
172,500
427,500
Furniture
and
Fixture
350,000
50,000
-
400,000
10
150,000
-
25,000
175,000
225,000
Vehicles
930,000
-
-
930,000
20
300,000
-
126,000
426,000
504,000
600,000
-
173,500
773,500
1,656,500
2,305,000
125,000
-
2,430,000
Total
2002
2,305,000
600,000
1,705,000
Total
2001
x
x
x
x
x
x
Note
# 2
Tax
Payable
Tax
Payable as Per Trial
Balance
35,500
Current
Year's Provision
9,800
45,300
281
Financial
Accounting (Mgt-101)
VU
Note
# 3
Net
Sales
Gross
Sales
857,200
Less:
Returns
10,000
847,200
Note
# 4
Cost
of Goods Sold
Opening
Stock
85,000
Add:
Cost of Material
Purchased
Gross
Purchases
500,000
Less:
Returns
12,800
Add:
Carriage Inward
8,000
495,200
Less:
Closing Stock
65,000
Cost
of goods sold
515,200
Note
# 5
Administrative
Expenses
Salaries
(Admin. Staff)
65,000
Rent,
Rates and Taxes
12,500
Legal
Charges
7,500
Depreciation
173,500
TOTAL
258,500
Note
# 6
Selling
Expenses
Salaries
(Sales Staff)
45,000
Selling
Expenses
23,000
TOTAL
68,000
282
Table of Contents:
- Introduction to Financial Accounting
- Basic Concepts of Business: capital, profit, budget
- Cash Accounting and Accrual Accounting
- Business entity, Single and double entry book-keeping, Debit and Credit
- Rules of Debit and Credit for Assets, Liabilities, Income and Expenses
- flow of transactions, books of accounts, General Ledger balance
- Cash book and bank book, Accounting Period, Trial Balance and its limitations
- Profit & Loss account from trial balance, Receipt & Payment, Income & Expenditure and Profit & Loss account
- Assets and Liabilities, Balance Sheet from trial balance
- Sample Transactions of a Company
- Sample Accounts of a Company
- THE ACCOUNTING EQUATION
- types of vouchers, Carrying forward the balance of an account
- ILLUSTRATIONS: Ccarrying Forward of Balances
- Opening Stock, Closing Stock
- COST OF GOODS SOLD STATEMENT
- DEPRECIATION
- GROUPINGS OF FIXED ASSETS
- CAPITAL WORK IN PROGRESS 1
- CAPITAL WORK IN PROGRESS 2
- REVALUATION OF FIXED ASSETS
- Banking transactions, Bank reconciliation statements
- RECAP
- Accounting Examples with Solutions
- RECORDING OF PROVISION FOR BAD DEBTS
- SUBSIDIARY BOOKS
- A PERSON IS BOTH DEBTOR AND CREDITOR
- RECTIFICATION OF ERROR
- STANDARD FORMAT OF PROFIT & LOSS ACCOUNT
- STANDARD FORMAT OF BALANCE SHEET
- DIFFERENT BUSINESS ENTITIES: Commercial, Non-commercial organizations
- SOLE PROPRIETORSHIP
- Financial Statements Of Manufacturing Concern
- Financial Statements of Partnership firms
- INTEREST ON CAPITAL AND DRAWINGS
- DISADVANTAGES OF A PARTNERSHIP FIRM
- SHARE CAPITAL
- STATEMENT OF CHANGES IN EQUITY
- Financial Statements of Limited Companies
- Financial Statements of Limited Companies
- CASH FLOW STATEMENT 1
- CASH FLOW STATEMENT 2
- FINANCIAL STATEMENTS OF LISTED, QUOTED COMPANIES
- FINANCIAL STATEMENTS OF LISTED COMPANIES
- FINANCIAL STATEMENTS OF LISTED COMPANIES