Page 105 - DCOM302_MANAGEMENT_ACCOUNTING

Management Accounting

Notes Creditors 3,600 3,600 Plant 10,600 9,600

Outstanding Wages 1,400 800 Prepaid Insurance 400 800
Income Tax Provision 3,800 3,400
32,400 43,600 32,400 43,600
Plant was sold at its book value, i.e., ` 1,000
8. From the following Balance Sheets, prepare a Schedule of changes in Working Capital and
Funds Flow Statement:
Liabilities 31.12.07 31.12.08 Assets 31.1 2.07 31.12.08
(`) (`) (`) (`)
Capital 4,80,000 5,10,000 Cash at Bank 24,000 54,000
Profit & Loss a/c 8,50,000 10,50,000 Debtors 9,90,000 11,90,000

Creditors 54,000 30,000 Stock 54,000 42,000
Mortgage Loans 28,000 1,00,000 Land 2,00,000 2,00,000
Plant 1,44,000 2,04,000
14,12,000 16,90,000 14,12,000 16,90,00
9. The following is the abstract of balance sheet of Software securities Ltd. for the year 2005
and 2006

2005 2006 2005 2006
Liabilities (`) (`) Assets (`) (`)
Provision for 108000 396000 Land 26000 81000
depreciation
Retained earning 244800 370800 Building 60000 360000
9% Debenture 270000 198000 Accumulated depreciation 19800 37800
on building
Account payable 72000 41400 Equipment 122400 347400
Expense payable 0 18000 Accumulated depreciation 18000 50400
on Equipment
Stock in hand 10800 97200
Account receivable 36000 122400
Cash in hand 66600 97200
Preliminary expenses 10800 7200
The income statement of Software Securities Ltd. is as under
Sales 1602000

less cost of sale 837000
less operating exp. 397800
less interest exp. 21600
loss on sale of equipments 3600
126000

Net income before tax 342000
Provision of tax 117000
Net Income after tax 225000

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