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Standard XII
Accountancy
Grouping of Items in Statement of Profit and Loss
Which financi...
Question

Which financial statement will allow you to determine the net profit of the company?


A

Balance Sheet

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B

Income Statement

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C

Statement Of Cash Flows

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D

None of these

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Solution

The correct option is B

Income Statement


Statement of Profit and Loss will allow us to determine the net profit of the company.


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Q. The correct sequence in preparation of periodical financial statement would be :
1. Preparation of balance sheet
2. Preparation of cash flow statement
3. Preparation of trial balance
4. Preparation of Profit and Loss A/c
Select the correct answer from the option given below.
Q. Given below are two statements, one labelled as Assertion (A) and the other labelled as Reasons (R).

Assertion (A) - The income statement and the balance sheet are financial statements that show the cash flows in and out of the business unit.

Reason (R) - The general purpose of financial statements is to show the financial position and performance of a business unit.

In the context of the above two statements, which of the following is correct?

[0.88 marks]
Q. Prepare Cash Flow Statement from the following Balance Sheet:

Particulars ulars

 Note No.
31st March, 2013
(₹)
31st March, 2012
(₹)
I. EQUITY AND LIABILITIES
1. Shareholders' Funds
(a) Share Capital
 6,00,000 5,00,000
(b) Reserves and Surplus
 1 4,00,000 2,00,000
2. Current Liabilities
(a) Trade Payables
 2,80,000 1,80,000
Total Total Expenses
 12,80,000 8,80,000
II. ASSETS
1, Non-Current Assets
(a) Fixed Assets:
Plant and Machinery
 5,00,000 3,00,000
2. Current Assets
(a) Inventories
 1,00,000 1,50,000
(b) Trade Receivables
 6,00,000 4,00,000
(c) Cash and Cash Equivalents
 80,000 30,000
Total
 12,80,000 8,80,000
Notes to Accounts

Particulars
31st March, 2013
(₹)
31st March, 2012
(₹)
I. Reserves and Surplus
Surplus, i.e., Balance in Statement of Profit and Loss
 4,00,000 2,00,000
Additional Information:
(i) An old machinery having book value of ₹50,000 was sold for ₹60,000.
(ii) Depreciation provided on Machinery during the year was ₹30,000.
Q. From the following Balance Sheet of Young India Ltd., prepare Cash Flow Statement:
BALANCE SHEET OF YOUNG INDIA LTD.
as at 31st March, 2019

Particular

Note No.

31st March, 2019 (₹)

31st March, 2018 (₹)
I. EQUITY AND LIABILITIES
1. Shareholders' Funds
(a) Share Capital

2,50,000

2,00,000
(b) Reserves and Surplus: Surplus, i.e., Balance in Statement of Profit and Loss

1,83,000

82,000
2. Non-Current Liabilities

Long-term Borrowings:

15% Debentures

80,000

50,000
3. Current Liabilities

(a) Trade Payables

1,50,000

1,10,000
(b) Other Current Liabilities

12,000

20,000

Total

6,75,000

4,62,000
II. ASSETS
1. Non-Current Assets
(a) Fixed Assets (Tangible)

2,74,000

1,17,000
(b) Non-Current Investments

68,000

55,000
2. Current Assets

(a) Inventories

2,06,000

1,50,000
(b) Trade Receivables

32,000

70,000
(c) Cash and Cash Equivalents

95,000

70,000

Total

6,75,000

4,62,000
Q.

From the following Balance Sheet and information of Volvo Ltd., prepare Cash Flow Statement:

Particulars ulars

 Note No.
31st March, 2019
(₹)
31st March, 2018
(₹)
I. EQUITY AND LIABILITIES
1. Shareholders' Funds
(a) Share Capital
 1 2,25,000 2,50,000
(b) Reserves and Surplus
 2 1,27,500 50,000
2. Non-Current Liabilities
Long-term Borrowings: 10% Debentures
 1,00,000 50,000
3. Current Liabilities
(a) Trade Payables
 72,500 35,000
(b) Other Current Liabilities−Premium on Redemption of Preference Shares
 2,500 5,000
Total Total Expenses
 5,27,500 3,90,000
II. ASSETS
1, Non-Current Assets
(a) Fixed Assets−Tangible
 3,10,000 2,55,000
(b) Non-Current Investments (10% Investments)
 40,000 15,000
2. Current Assets
(a) Current Investments
 5,000 4,000
(b) Inventories
 45,000 50,000
(c) Trade Receivables
 3 92,500 45,000
(d) Cash and Cash Equivalents
 4 35,000 21,000
Total
 5,27,500 3,90,000

Notes to Accounts

Particulars
31st March, 2019
(₹)
31st March, 2018
(₹)
1. Share Capital
Equity Share Capital
1,75,000
1,50,000
12% Preference Share Capital
50,000
1,00,000
2,25,000
2,50,000
2. Reserves and Surplus
General Reserve
10,000
15,000
Surplus, i.e., Balance in Statement of Profit and Loss
1,17,500
35,000
1,27,500
50,000
3. Trade Receivables
Sundry Debtors
1,00,000
50,000
Less: Provision for Doubtful Debts
7,500
5,000
92,500
45,000
4. Cash and Cash Equivalents
Cash in Hand
12,500
6,000
Cash in Bank
22,500
15,000
35,000
21,000
Additional Information :
(i) You are informed during the year:
Proposed Dividend
31st March, 2019
(₹)
31st March, 2018
(₹)
Equity Share Capital NIL NIL
Preference Share Capital 12% 12%
(ii) A machine with a book value of ₹20,000 was sold for ₹12,500;
(iii) Depreciation charged during the year was ₹35,000;
(iv) Preference shares were redeemed on 31st March, 2018 at a premium of 5%;
(v) An Interim dividend of ₹5,000 was paid on equity shares on 31st March, 2019 out of General Reserve;
(vi) Fresh equity shares were Issued on 31st March, 2019; and
(vii) Additional Investments were purchased on 31st March, 2019.
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