Practice Test - 11 CA INTERMEDIATE UDESH JANUARY 2025 (Group 1) 16/06/2024

Duration : 60 min
ADVANCED ACCOUNTING
Question 1(i to iii) Carry 1 Mark

1.(i). Accounting Standards for non-corporate entities in (iii). All non-corporate entities engaged in commercial,
India are issued by: industrial or business activities having borrowings
(1) Central Govt (including public deposits) in excess of rupees two
(2) State Govt crores but does not exceed rupees ten crores at any
(3) Institute of Chartered Accountants of India time during the immediately preceding accounting
(4) MCA year
(1) Level II entities
(2) Level IV entities.
(ii). IFRS stands for
(3) Level III entities.
(1) International Financial Reporting standards
(2) International Financial Reporting statements (4) Level I entities.
(3) Indian Financial Reporting standards
(4) Indian Financial Reporting statements
 Subjective Question

2. In the books of M/s Suresh Ltd. closing inventory as on 31.03.2021 amounts to Rs. 1,83,000 (on the basis of FIFO
method). The company decides to change from FIFO method to weighted average method for ascertaining the cost
of inventory from the year 2020-21. On the basis of weighted average method, closing inventory as on 31.03.2021
amounts to Rs. 1,69,000. Realisable value of the inventory as on 31.03.2021 amounts to Rs. 2,15,000.
Discuss disclosure requirement of change in accounting policy as per AS-1
(4 Marks)

3. A Limited is engaged in manufacturing of Chemical Y for which Raw Material X is required. The company
provides you following information for the year ended 31st March, 2021
Rs. per unit
Raw material X
Cost price 380
Unloading charges 20
Freight inward 40
Replacement cost 300
Chemical Y
Material consumed 440
Direct labour 120
Variable overhead 80
Additional Information:
(i) Total fixed overhead for the year was Rs. 4,00,000 on normal capacity of 20,000 units.
(ii) Closing balance of Raw Material X was 2,000 units and Chemical Y was 2,400 units.
You are required to calculate the total value of closing stock of Raw Material X and Chemical Y according to AS 2,
when
(a) Net realizable value of Chemical Y is Rs. 800 per unit
(b) Net realizable value of Chemical Y is Rs. 600 per unit
(5 Marks)
4. Explain briefly the accounting treatment needed in the following cases as per AS 11:
(i) Sundry Debtors include amount receivable from Ted of U.S., Rs. 5,00,000 recorded at the prevailing exchange
rate on the date of sales, transaction recorded at $1 = Rs. 38.70.
(ii) Long term loan taken from a U.S. Company, amounting to Rs. 60,00,000. It was recorded at $1 = Rs. 35.60,
taking exchange rate prevailing at the date of transactions.
Exchange rates at the end of the year were as under:
$1 Receivable = Rs. 45.80 $ 1 Payable = Rs. 45.90
(5 Marks)

5. ABC Ltd. purchased fixed assets for Rs. 1,00,00,000. Government grant received towards it is 20%. Residual value
is Rs. 16,00,000 and useful life is 8 years. Assumed depreciation is on the basis of Straight Line Method, asset is
shown in the Balance Sheet net of grant. After one year, grant becomes refundable to the extent of Rs. 14,00,000
due to noncompliance of certain conditions. Pass Journal entries for 2nd year in the books of the company
(5 Marks)
6. “While calculating diluted earning per share, effect is given to all dilutive potential equity shares that were
outstanding during that period.” Explain. Also calculate the diluted earnings per share from the following
information:
Net profit for the current year Rs.85,50,000
No. of equity shares outstanding 20,00,000
No. of 8% convertible debentures of Rs. 100 each. Each debenture is convertible into 1,00,000
10 equity shares
Interest expenses for the current year Rs. 6,00,000
Tax relating to interest expenses 30%
(5 Marks)
 CORPORATE AND OTHER LAWS
Each Question Carry 2 Mark

1. Ganesh Company Ltd, a public company 4. From the following information in respect of
incorporated under the Companies Act, 2013 has
Mr. Jay- Director, Mr. Sagar – Independent
Director, Mr. Abhishek - Nominee Director and
Mr. Yash - Whole time director. Mr. Abhishek Financial year Net profit (₹ cr.)
wants to inspect the books of accounts of Shankar 2014-15 30
Company Limited, the subsidiary of Ganesh 2015-16 22
Company Limited. You are required to state 2016-17 29
whether Mr. Abhishek is eligible to inspect the (1) 27 Crore (2) 54 Lacs
(3) 56 Lacs (4) 27 Lacs
books of accounts of Ganesh Company Limited?
(1) Yes, Mr. Abhishek can inspect the books of
5. The audited financial statements must be circulated
accounts of Shankar Company limited only on
to members at least___ days before.
authorization of the public financial institution
(1) 10 Days
on whose behalf he has been so appointed in
(2) 21 Days
the board of the Ganesh Company Ltd (3) 30 Days
(2) No, Mr. Abhishek being a nominee director
(4) 60 Days
can only inspect the books of accounts of
Ganesh Company Ltd and not its subsidiary
company. 6. Adani Enterprises Limited has its shares listed on a
(3) Yes, Mr. Abhishek can inspect the books of recognized stock exchange in India. During the
accounts of Shankar Company limited only on current financial year ending on 31 March 2020,
authorization by way of resolution of the the securities and exchange board of India (SEBI)
board of directors. has found some irregularities in the filings made by
(4) Yes, Mr. Abhishek can inspect the books of the company. Accordingly, SEBI proposes to make
accounts of Shankar Company limited only on an application to the Tribunal for reopening of the
authorization by way of resolution of the books of accounts of the Company. You, as an
members holding not less than 25% of the expert, are called upon by SEBI to advise with
paid-up share capital of the company. which last financial year for reopening of books of
accounts an application can be made?
2. Which of the following company is mandatorily (1) 2015 – 2016 (2) 2013 – 2014
required to prepare cash flow statement? (3) 2010 – 2011 (4) 2011 – 2012
(1) OPC
(2) Small company 7. CSR Committee of the Board of shall consist of:
(3) Dormant company
(1) Directors forming 1/3rd of the total no of
(4) Nidhi company
directors.
(2) At least 2 directors out of which one shall be
3. On application of Central Government, Tribunal
independent director.
may order to re-open books of accounts of a
company for maximum? (3) 3 or more directors out of which one shall be
(1) 3 years managing director.
(2) 5 years (4) 3 or more directors, out of which at least 1
(3) 8 years director shall be an independent director
(4) 8 years
 Subjective Question
Each Question Carry 6 Marks

1. The Companies Act, 2013 has prescribed an 4. Yellow Ltd. received a communication from Central
additional duty on the Board of Directors to include Government for preparation of periodical financial
in the Board’s Report a ‘Directors’ Responsibility results and complete audit or limited review of such
Statement’. Explain briefly the details to be periodical financial results. The Board of Directors
furnished in the said statement. have raised an objection on the ground that as it is an
unlisted company, periodical financial results need
2. Infosys Ltd is a listed company having turnover of not to be prepared. Examine, referring the provisions
Rs 1200 crores during the financial year 2021- 22. of the Companies Act, 2013, in this regard.
The CSR committee of the Board formulated and
recommended a CSR project which was approved
5. Kim Private Limited was incorporated on 30th
by the Board. The company finalised the project
under its CSR initiatives which require funds @ 5 September 2016. It has a paid up share capital of Rs
% of average net profit of the company for last 45 crore. The company had a turnover of Rs 250
three financial years. Will such excess expense be crore for the financial year 2019-20. The accounts
counted in subsequent financial years as a part of manager of the company has intimated to the
CSR expenditure? Advise the company.
company that they are not required to appoint
internal auditor for the financial year 2020-21. The
3. Red Limited (the Company) was incorporated on
01.04.2020. The balances extracted from its management of the company have approached you
audited financial statement are as given below: to advise them about the appointment of internal
auditor. Advise them as per the provisions of the
Net Profit after tax
Financial Net Profit Companies Act, 2013
(Ignore Income Tax
Year (FY) before tax
computation)
2020-21 Rs 5.00 crore Rs 3.75 crore 6. State the persons responsible for complying with the
2021-22 Rs 7.00 crore Rs 5.25 crore provisions regarding maintenance of Books of
Accounts of a company. Support with the help of
The company proposes to allocate the minimum
required amount for CSR Activities to be relevant provisions of the Companies Act, 2013.
undertaken during FY 2022-23, if it is mandatory.
You are requested to advice the company in this
regard and compute the minimum amount to be
allocated, if so required, taking into account the
relevant provisions of the Companies Act, 2013.

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