Page 197 - DCOM205_ACCOUNTING_FOR_COMPANIES_II

Accounting for Companies – II

notes 5,12,000 Estimated Deficiency as regards creditors (being the different between gross
assets and gross liabilities) Issued and Called up Capital 85,000
6%; 40,000 Preference Shares of ` 10 each fully paid up as per list f 4,00,000
80,000 Equity Shares of ` 5 each fully paid up as per list g 4,00,000

Estimated deficiency as regards contributories as per list H 8,85,000
Deficiency Account – List H
Items Contributing to Deficiency:
Excess of Capital and Liabilities over Assets on
1 Jan., 2011 as shown by the Balance Sheet. 5,16,000
st
Losses other than trading losses now written off: `
Bills Discounted likely to be dishonoured 20,000
Bad debts (12,000+7,000) 19,000
Shares in Shobhit Ltd. 20,000
Shares in X Ltd. 10,000
Land & Buildings 2,20,000
Stock-in-trade 20,000
Machinery & Tools 60,000 3,69,000
Deficiency as shown by Statement of Affairs 8,85,000

Working Note:
Balance sheet of mudit co. ltd.
as on 1 January, 2011
st
liabilities ` assets `
80,000 Equity Shares of ` 5 Land & Buildings 3,00,000
each fully paid up 4,00,000 Machinery & Tools 1,00,000
40,000; 6% Pref. Shares of ` 10 Shares in Shobhit Ltd. 90,000
each fully paid up 4,00,000 Shares in X Ltd. 30,000
5% Mortgage Debentures 2,00,000 Value of Securities held by
Fully Secured Creditors 60,000 fully Secured Creditors 60,000
Partly Secured Creditors 40,000 Bills Receivable 30,000
Preferential Creditors 12,000 Book Debts – Good 20,000
Bills Payable 20,000 Doubtful 14,000
Unsecured Creditors 1,40,000 Bad 12,000
Bank Overdraft 20,000 Stock-in-trade 1,00,000
Cash-in-hand 20,000
Excess of Liabilities over Assets 5,16,000
12,92,000 12,92,000

Task Discuss the term deficiency account.

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