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posted by  akbar on 7/25/2008 1:21:45 AM  |  status: Live  

Financial Accounting

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Question Details:

On Nov 1, 2008 the company borrowed Rs. 4,000,000 at 24% to finance construction of the plant.

Repayment of loan will start a month after completion of project.

During the year ended Oct.31, 2009, expenditure on the building was Rs.3, 000,000. The expenditure was incurred evenly through the year.

What amount of interest should be capitalized in year ended Oct, 31 2009?
Question # 02

Net profit for year ended December 31,2007

Rs.

1,300

weighted average number of ordinary shares outstanding during 2007

200 shares

Average value of one ordinary share during year 2007

Rs.

25

Weighted average number of share under option during 2007

80 shares

Exercise price for shares under option during year 2007

Rs.

20

Required:

Compute basic and diluted earning per share.

Question # 03A
 

Five years ago, Hassan Ltd acquired the following shares in Pervaiz Ltd:

Rupees

75,000 Ordinary shares of Rs. 1 --- cost 93,100

15,000 6% Preferred shares of Rs. 1 --- cost 16,050

109,150

At the date of acquisition, the retained earnings of Pervaiz Ltd amounted to Rs. 11,000. The summarized balance sheets of the two companies at 31 December 2008 were as follows:

Hassan Ltd

(Rupees)

Pervaiz Ltd

(Rupees)

Ordinary Shares of Rs. 1

350,000

100,000

6% Preferred Shares of Rs. 1

----

60,000

Reserves

348,420

132,700

Sundry payables

93,400

51,150

791,820

343,850

Tangible Non- Current assets

431,100

219,350

Investments

109,150

----

Inventory

143,070

71,120

Receivables

89,200

36,230

Cash at Bank

19,300

17,150

791,820

343,850

 

During the year Hassan Ltd sold goods whose invoice value was Rs. 24,000 to Pervaiz Ltd. These goods were invoiced at cost plus 25%, and one-quarter were still in Pervaiz’s inventory at the year end.

Required:

Prepare the consolidated balance sheet of Hassan Ltd as at 31 December 2008.

 

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