Q.

Instructions:
ccounts:
Notes to Date:
1 (iv)
(ii) (i) 0)
Course: Exam
Total | folowing
AS- Fromthe Use
Figures All This Type:
AssetsII. Total 3
Current
Assets 2. Non-current
assets 1,
Particulars
I. of questions
of is Healthcare
Liabilities
Current 3.
Non-Current
Liabilities
2.
Shareholder's Equity
Funds1. Alembic calculator to closed a Closed
Inventories
Receivables
Trade
c) b) a) b) assets Fixed a) c) current
Other Bank the
payables
Trade
b) a)
borrowings:
Loan Long
term capital
Sharea)
b)
equivalents Cash investments
Non-current Tangible
assets
i . i. Short rent
outstanding
liabilities: and right are book
Intangible Reserve Balance Ltd compulsory. is Financial Book
and Liabilities indicate
for allowed.
term information, examination. Program: INDIAN
cash and Sheet the
provisions the Accounting MANAGEMENT
|INSTITUTE
JAMMU
assets Surplus year
of HA&HM
(Academic
2023-24) MBA
Examination
Year TermEnd
Alembic endedprepare gntagewe
6 5 4 3 2 1
on or OF
No. Note Ltd. March Cash
as
each 2023-25),
Term
(Batch
Flow
on question
March,31* 31,
March Statement
6,36,000 3,50,000
2,10,000 2023 Max
636,000 1,63,50060,00065,000 50,00047,2,50,000
500 25,000 3,500 22,500 25,000 2023
31, Duration:
hours3.0Marks:
2023 as
March,31$t per 40
2,50,000 4,67,500 2,75,000
1,00,000 the (Weightage=40%)
467500 1,|02,50040,00025,000 50,000 15,000 50,000 2022
2,500 25,000 Revised

(10)
 31# March, 31* March,
Particulars 2020 2019
3,50,000 2,75,000
1. Equity Share Capital
2. Reserve and Surplus
Surplus: i.e. Balance in statement of
Profit and Loss 2,10,000 1,00,000
3. Short term Provision:
Provision for Taxation 25,000 15,000
4. Fixed Assets
Tangible Assets
Equipment 1,15,000 1,00,000
Furniture 1,35,000 1,50,000
2,50,000 2,50,000
5. Intangible Assets
Patents 47,500 50,000
6. Cash and cash equivalents
i) Cash 13,500 2,500
ii) Bank Balance 1,50,000 1,00,000
1,63,500 L,02,500

Additional information:
1. During the year, equipment costing Rs. 40,000 was purchased.
2. Loss on sale of equipment amounted to Rs. 2,500 and proceed from sale
of equipment was Rs.15,000.
3. Depreciation of Rs. 7,500 and Rs. 15,000 charged on equipment and
furniture.

Sellersize Ltd. is facing problem of cash. Some members of the board feels that low. (10)
a2
PAT is.the reason for cash crunch while other members feel that huge debt and
huge servicing cost of debt is leading to low profit and thus it is a reason for the
cash crunch. Therefore, Mr. Salva, the CFO of Sellersize Ltd. is assigned a task to
investigate the reason for cash crunch and make a presentation in the next board
meeting. Mr. Salva sits with the profit and loss statement and balance sheet of last
two years. Youare required to assist Mr. Salva in identifying the area of concern
and provide workable solution to him. The extracts of last two years income
statements and balance sheets are provided for your reference.
Statement of Profit and Loss - For the year ended March 31, 2022 and 2023
Particulars
March 31, 2022 March 31, 2023
(Rs.) (Rs.)
Net Sales 15,00,000 19,00,000
Less:Expenses
Cost of Goods Sold 9,00,000 13,00,000
Rent on office building 2,00,000 40,000
Employee benefit expenses 75,000 1,12,500
Selling Expenses 70,000 80,000
Depreciation 40,000 1,07,000
Interest 80,000 1,00,500
Loss on sale of old assets 50,000
PBT
1,35,000 1,10,000
 47,250 38,500
Tax
87,750 71,500
PAT 50,000
Dividends 50,000
37,750 21,500
Retained earnings
and 2023
Balance Sheet - As on March 31, 2022 March 31, 2023 (Rs.)
March 31, 2022 (Rs.)
Assets
10,53,000 14,35,000
Fixed assets (net) 2,00,000
Investment (Long term) 2,50,000
1,20,000 82,000
Cash and bank balance
1,50,000 3,20,000
Receivables
6,05,000 11,35,000
Inventories
41,000 50,000
Prepaid expenses 32,22,000
Total 22,19,000
March 31, 2022 (Rs.) March 31, 2023 (Rs.)
Liabilities
10,00,000 15,00,000
Equity share capital
Reserves and surplus 3,80,000 4,17,750
5,00,000 7,00,000
Long term loan
1,39,000 2,87,000
Debentures
Trade creditors 1,50,000 2,57,000
50,000 60,250
Provisions
22,19,000 32,22,000
Total

performances. The
Mr. Salva also collected some information of the industry
industry average ratios are as under:
Gross Profit ratio 35%
EBITDA margin 20%
EBIT margin 15%
Net profit margin 10%
Current Ratio 4:1
Quick Ratio 2:1
Debt/Equity ratio 2:1

January1 at (10)
a.3 Apollo Hospital Ltd. makes a lump-sum purchase of several assets on purchased
total
atotal cash price of Rs. 9,00,000. The estimated market value of
Rs. 28,800;
assets are building, Rs. 5,08,000; land, Rs. 2,97,000; land improvements,
and four vehicles, Rs. 1,24,800.

1. Allocate lump-sum purchase price to the separate assets purchased.

2. Compute first year depreciation expense on building
using straight line
method assuming 15-year life and a Rs. 27,000 salvage value.
land
3. Compute the first-year depreciation expense on the total
improvements assuming five year life and double declining method.
initial
4, Assuming company expects to earn Rs. 50,00,000 annually for the
three years, after deducting all expenses except depreciation and taxes.
Prepare the Table showing Earnings before depreciation, depreciation
expense, pre-tax income and post-tax net Income for the first three years
(Taxrate is 10%).
Q4 How would you like to assess the earnings qualty of thecompany. (5)
a.5 Indicate whether each statement best describes the allowance method or the (5)
direct write off method.

1. Does not predict bad debt expense.

2. Accounts receivable on the balance sheet is reported at net realizable
value.
3. The write-off of the specific account does not affect net income.
4. When an account is written of, the debit is to Bad Debts expense.
5. Estimates bad debt expenses related to the sales recorded in the period.