Prof.

Pratibha Sharma
[email protected]
8910645483
1. PROBLEMS

Problem 1
From the following Balance Sheet of New India Ltd., Prepare a Comparative Balance Sheet:

2014 2015 2014 2015

Liabilities Assets
Rs. Rs. Rs. Rs.
Share Capital 30,000 60,000 Fixed Assets 80,000 1,02,000
Reserves 12,000 10,000 Debtors 10,000 20,000
Debentures 60,000 60,000 Bank 12,000 8,000

1,02,000 1,30,000 1,02,000 1,30,000

Problem 2
From the following figures of Balance Sheet of X & Co., prepare a Comparative Balance Sheet:

1.1.17 1.1.18
Particulars
Rs. Rs.
Equity Share Capital 4,00,000 5,00,000
Preference Share Capital 2,00,000 1,00,000
10% Debentures 1,50,000 1,00,000
Reserves & Surplus 40,000 70,000
Long-term Loan 2,00,000 3,00,000
Investment 2,20,000 2,50,000
Fixed Assets 5,70,000 6,30,000
Current Assets 2,80,000 3,10,000
Current Liabilities 80,000 1,20,000

Problem 3
Following are the Balance Sheet of Rawdon Ltd. as on 31 March 2018 and 31 March 2019:

31 March 31 March 31 March 31 March

Liabilities 2018 2019 Assets 2018 2019
Rs. Rs. Rs. Rs.
Equity Share Capital 2,50,000 4,00,000 Fixed Assets 5,00,000 7,00,000
Reserves & Surplus 1,25,000 2,00,000 Investment 20,000 50,000
Secured Loan 2,50,000 3,50,000 Stock 3,00,000 2,00,000
Current Liabilities 2,75,000 50,000 Debtors 50,000 20,000
Other Current Assets 30,000 30,000
9,00,000 10,00,000 9,00,000 10,00,000

Prepare a Comparative Balance Sheet and interpret the financial position of the company.

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 Prof. Pratibha Sharma
[email protected]
8910645483

Problem 4
Balance Sheet of star Ltd. for the years that ended on 31 December 2016 and 31 December 2017 are as follows:
31 December 31 December 31 December 31 December
Liabilities Assets
2016 2017 2016 2017
Rs. Rs. Rs. Rs.
Equity Share Capital 8,00,000 8,00,000 Building 6,00,000 5,40,000
10% Pref. Share Capital 6,00,000 6,00,000 Land 2,00,000 2,00,000
General Reserve 4,00,000 4,90,000 Plant 6,00,000 5,40,000
15% Debentures 2,00,000 3,00,000 Furniture 2,00,000 2,80,000
Creditors 3,00,000 4,00,000 Stock 4,00,000 6,00,000
Bills Payable 1,00,000 1,50,000 Debtors 4,00,000 6,00,000
Tax Payable 2,00,000 3,00,000 Cash 2,00,000 2,80,000
26,00,000 30,40,000 26,00,000 30,40,000

Prepare a Comparative Balance Sheet in vertical from and give a brief comment on Fixed Assets.

Problem 5
From the following information, prepare a Comparative Balance Sheet of Rezala Ltd. as on 31 December 2018 and
31 December 2019 and interpret the financial position of the company:

31 December 31 December 31 December 31 December

Liabilities 2018 2019 Assets 2018 2019
Rs. in `000 Rs. in `000 Rs. in `000 Rs. in `000
Equity Share of Rs. 100 800 900 Land & Building 550 500
each
12% Preference Shares 300 200 Plant & Machinery 350 300
of Rs. 100 each
Statutory Reserve 50 50 Investment 150 50
Profit & Loss A/c 50 30 Stock 350 250
Revaluation Reserve 150 100 Sundry Debtors 250 300
General Reserve 170 150 Bills Receivable 50 50
10% Debentures (Rs. 100 60 30 Cash at Bank 300 200
each)
Sundry Creditors 270 120
Bills Payable 150 70
2,000 1,650 2,000 1,650

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 Prof. Pratibha Sharma
[email protected]
8910645483

Problem 6
From the following information of Lawdon Ltd. for the years that ended on 31 March 2018 and 31 March 2019,
prepare a Comparative Balance Sheet as on 31 March 2018 and 31 March 2019 and interpret the financial position
of the company:

31 March 31 March 31 March 31 March

Liabilities 2018 2019 Assets 2018 2019
Rs. Rs. Rs. Rs.
Equity Share Capital 5,00,000 6,00,000 Land & Building 2,00,000 1,00,000
General Reserve 40,000 50,000 Plant & Machinery 1,50,000 2,00,000
Sundry Creditors 2,40,000 70,000 Investment 2,97,000 2,00,000
Bills Payable 50,000 25,000 Stock 40,000 30,000
Outstanding Expenses 50,000 Debtors 50,000 50,000
Bills Receivable 63,000 1,00,000
Profit & Loss A/c 70,000 60,000
Discount on issue of Shares 10,000 5,000
8,80,000 7,45,000 8,80,000 7,45,000

Problem 7
From the following information prepare a Comparative Income Statement:

2018 2019
Sales
Cost of Goods Sold 4,00,000 5,00,000
Operating Expenses 2,40,000 3,50,000
1,20,000 1,80,000

Problem 8
From the following information of Jodha Ltd., prepare a Comparative Income Statement for the years that ended
on 31 December 2018 and 31 December 2019:

2018 2019
Rs. Rs.
Net Sales 1,00,000 1,10,000
Less: Cost of Goods Sold 70,000 75,000
30,000 35,000
Less: Office & Administration Expenses 5,000 7,000
Selling & Distribution Expenses 6,000 5,000
19,000 23,000
Less: Interest Paid 1,000 2,000
Tax Paid 5,000 6,000
13,000 15,000

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 Prof. Pratibha Sharma
[email protected]
8910645483

Problem 9
From the following information of Lalbaba Ltd. for the years that ended on 31 March 2018 and 31 March 2019,
prepare a Comparative Income Statement and comment on the performance of the company.

2018 (Rs.) 2019 (Rs.)

Gross Sales 4,75,000 5,20,000
Sales Return 25,000 10,000
Purchase during the year 3,00,000 3,20,000
Opening Stock 50,000 60,000
Closing Stock 10,000 12,000
Direct Wages Paid 600 800
Office and Administrative Expenses 15,000 25,000
Selling & Distribution Expenses 30,000 25,000
Interest Paid 7,000 8,000
Tax Paid 15,000 20,000

Problem 10
From the following information, prepare a Comparative Income Statement for the years that ended on 31 March
2018 and 31 March 2019:

Trading and Profit & Loss A/c for the years that ended on 31 March 2008 and 31 March 2009

31st March 31st March 31st March 31st March

2018 2019 2018 2019
Rs. Rs. Rs. Rs.
To Opening Stock 1,50,000 3,00,000 By Sales 10,00,000 15,00,000
To Purchases 7,70,000 9,80,000 Less: Sales Return 50,000 20,000
To Carriage Inward 20,000 25,000 9,50,000 14,80,000
To Gross Profit c/d 2,85,000 5,75,000 By Closing Stock 2,75,000 4,00,000
12,25,000 18,80,000 12,25,000 18,80,000
To Salaries to Staff 20,000 45,000 By Gross Profit b/d 2,85,000 5,75,000
To Salary to Manager 5,000 15,000 By Other Incomes 15,000 15,000
To Insurance 4,000 3,500
To Advertisement 50,000 95,000
Expenses
To General Expenses 75,000 85,000
To Interest 5,000 6,000
To Tax Payable 600 700
To Net Profit b/d 1,40,400 3,39,800
3,00,000 5,90,000 3,00,000 5,90,000

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 Prof. Pratibha Sharma
[email protected]
8910645483

Problem 11
Following are the Income Statements and Balance Sheets of Discovery Ltd:
Income Statements for the years that ended on 31 December 2018 and 31 December 2019

2018 2019
Particulars
Rs. Rs.
Net Sales 4,00,000 5,00,000
Opening Stock of Goods 60,000 70,000
Closing Stock of Goods 50,000 40,000
Purchases for the year 1,90,000 2,10,000
Direct Wages 60,000 70,000
Factory Expenses 20,000 30,000
Office & Administration Expenses 25,000 35,000
Selling & Distribution Expenses 35,000 25,000
Interest on Debentures 10,000 20,000
Income Tax 24,000 32,000
Balance Sheets as on 31 December 2018 and 31 December 2019

31 31 31 31
December December December December
Liabilities Assets
2018 2019 2018 2019
Rs. Rs. Rs. Rs.
Equity Share Capital 2,00,000 3,00,000 Fixed Assets 2,80,000 4,50,000
(of Rs. 100 each)
Pref. Share Capital 1,00,000 2,00,000 Investment 1,00,000 1,80,000
Reserves and Surplus 1,60,000 2,20,000 Stock 70,000 1,20,000
Debentures 80,000 1,30,000 Debtors 80,000 1,00,000
Creditors 50,000 40,000 Cash & Bank 50,000 40,000
Bills Payable 10,000 10,000 Preliminary Expenses 20,000 10,000
6,00,000 9,00,000 6,00,000 9,00,000
Prepare the Comparative Income Statement and Balance Sheet of the company of 2 years.

Problem 12
From the following information prepare a Common-size Income Statement:
2018 (Rs.) 2019 (Rs.)
Sales 2,00,000 2,25,000
Cost of Goods Sold 40,000 55,000
Operating Expenses 85,000 66,000
Non-Operating Expenses 10,000 6,000
Tax Rate 40% 40%

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 Prof. Pratibha Sharma
[email protected]
8910645483

Problem 13
From the following information of a company for the year 2018 and 2019, prepare a Common-size Income Statement
and comment on the performance of the company:

2018 (Rs.) 2019 (Rs.)

Net Sales 1,00,000 1,10,000
Cost of Goods Sold 60,000 65,700
Selling General & Administration Expenses 30,000 37,000
Interest Paid 3,000 6,200
Interest Received 2,000 3,300
Income Tax 50% 50%

Problem 14
From the following information, make Common size Profit & Loss Accounts of A Ltd. and B Ltd. in terms of per-
centage only:

Rs. in lakhs
A Ltd. B Ltd.
Sales 15 80
Cost of Goods Sold 12 60
Administration Expenses 0.7 5
Selling Expenses 0.8 7
Financial Charge 0.2 2

Problem 15
Following data are available from M & Co. for 2016 and 2017. You are required to prepare a Common-size Income
Statement.

Particulars 2016 (Rs.) 2017 (Rs.)

Sales 10,00,000 12,50,000
Add: Commission Received 50,000 75,000
Add: Discount Received 1,00,000 1,25,000
11,50,000 14,50,000
Cost of Goods Sold 8,00,000 9,00,000
Operating Expenses 2,00,000 3,00,000
Non-operating Expenses 50,000 75,000
Profit 1,00,000 1,75,000
11,50,000 14,50,000

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 Prof. Pratibha Sharma
[email protected]
8910645483

Problem 16
With the help of following information for the year ended 2016, prepare a Common-size Income Statement:

Selling and Distribution Expenses Rs. 10,000

Administration Expenses Rs. 20,000
Cost of Goods sold 75% of Net Sales
Income Tax 20% of Net Profit before Tax
Net Income after Tax Rs. 48,000
Other Income Rs. 10,000

Problem 17
From the following information as furnished by Aaj Ltd. and Kal Ltd. as on 31 March 2019, prepare a Common-size
Balance Sheet as on that date and comment on the position of the companies:

Aaj Ltd. Kal Ltd.

Rs. Rs.
Fixed Assets (at cost) 3,00,000 5,00,000
Less: Provision for Depreciation 1,05,000 2,80,000
1,95,000 2,20,000
Investment 50,000 -
Sundry Debtors 30,000 80,000
Stock 15,000 29,000
Prepaid Expenses 6,000 18,000
Cash and Bank 22,000 67,000
3,18,000 4,14,000
Share Capital 1,00,000 1,50,000
General Reserve 60,000 79,000
Revenue Reserve 35,000 40,000
Long-term Loan 70,000 85,000
Sundry Creditors 50,000 50,000
Provision for Tax 3,000 10,000
3,18,000 4,14,000

Problem 18
From the following figures, calculate the trend percentages taking 2011 as the base year and give your comments:

Year Sales Cost of Goods Sold Inventory

2011 6,00,000 4,00,000 2,00,000
2012 7,00,000 4,75,000 2,20,000
2013 8,20,000 6,00,000 2,40,000
2014 9,50,000 7,90,000 2,50,000
2015 10,00,000 8,15,000 2,60,000
2016 11,00,000 9,05,000 2,80,000

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 Prof. Pratibha Sharma
[email protected]
8910645483

Problem 19
From the following data as obtained from the Financial Statements of Kailash Ltd., calculate trend percentage
taking 2017 as the base year:

2017 (Rs.) 2018 (Rs.) 2019 (Rs.)

Sales 1,80,000 2,00,000 2,60,000
Purchases 80,000 1,00,000 1,10,000
Expenses 10,000 15,000 20,000
Profit 90,000 85,000 1,30,000

Problem 20
From the trend percentage supplied here, prepare a Comparative Statement of Current Assets in absolute value
taking 2013 as the base year:

Trend Percentage Corresponding Value of Current Assets

2014 2015 2016 2016
120 130 150 3,600 – Cash & Bank
130 140 200 6,800 – Debtors
160 220 250 4,000 – Finished Goods
175 250 300 4,500 – W.I.P.
110 150 175 1,750 – Raw Materials

Problem 21
The following is financial information of ZN Ltd. for 3 years ended on 31 December every year:

Particulars 2015 (Rs.) 2016 (RS.) 2017 (Rs.)

Share Capital 1,50,000 1,80,000 1,90,000
Gross Profit 3,50,000 3,50,000 4,00,000
Current Liabilities 40,000 ? ?
Fixed Assets 2,40,000 2,50,000 2,35,000
Long-term Loan 1,00,000 ? 1,20,000
Cost of Goods Sold ? 4,00,000 3,00,000
Working Capital 60,000 50,000 1,40,000
Net Worth 2,00,000 2,20,000 2,55,000
Current Assets ? 1,20,000 2,00,000
Sales 5,50,000 7,50,000 ?
Capital Employed 3,00,000 ? ?
Reserves & Surplus ? 40,000 65,000
You are required to prepare Vertical Trend Financial Statement taking 2015 as the base year.