LTIPLE CHOICE QUESTIONS 1, Which of the following is not a characteristic of a company 7 (a) A company is a legal entity separate and distinct trom ts members ByYA shareholder of a company. in his indrvidual capactty. can bind the company (c) The shareholders of a company can enter into a contract with the company (d) Acompany must have a registered office 2. Which of the following is not a charactenstic ot equty share ? {a) itis the risk capital of the company (b) tt has voting power {¢) It has no preferential nght to divide (ct) R can be converted into preference shares 3. Preference shares must be redeemed within {a) 10 years from the date of issue of such share (b) 15 years from the date of issue of such share AB 20 years trom the date of issue of such share (0) 25 years from the date of issue of such share ‘4 Which of the following is not a charactensbc of a pubic limited company ? (a) Its shares are freely transferable (0) The number of directors should be at teast 3 (©) In a public company, there may be any number of members LATA public company can be incorporated with less than 7 persons and more than 2 persons 5. Issued capital is the part of (a) Subscribed Capital Ad) Authorised Capital (c) Cailed-up Capital (a) Paid-up Capital” Accountancy and Financial Management (S.1.A.Com, © “Reserve Capaar can be caled vp (2)19 an emergency onty (©) any tre by passing an ordinary resolubon {©) in me evert and for the purpose of he company beng wound uP (0) at directors agree 7. Subsenbes captal can be {8) more man cated-up capt! (0) more than ssued capta (6) more than authorised capital (4) equal to reserve canta 8. Shares can be sued by a pudke company through (2) Pubic oer onty (0) Prvate placement ony {) Rights bonus ‘save only (4) Aline above 8. Whi ofthe folowing s not rue for stock 7 (a) Stock i lump holding 0) Stock can be sued drecty (©) Stock must be tuy part () Stock # never numbered 10. The minimum appicaton money to be pid by an aopicant along wah Me socAcater | shat not be lest an (2) 20% of te tace veive ofthe shares (0) 20% of he s8u8 price le) 25% of me insu price (3) 255 of e value of te shares 1. Cale -amear shown in he Balance Sheet (2) on te assets secton uncer Curent Asets (©) on te equty and tabatessecson under ‘Share Capta! as a separate tom {€) on he equty and tabtes secton as a deducton rom paid-up captal (©) on he eauty and labites secton under ‘Cunert Labubes 12.Caleieradvance is shown nthe Balance Sheet. (a) on tne tabines secton as part of share captal LB} on the habits secton under Curent Labia’ as a separate tem (c) on the assets gecton asa deducton of cash and bank (@) on the assets secton asa separate tem under Curent Asses’ 13.As per Table Fof Scneaue | te Compares Ac 2013, terest on cats--area a] (a) @ 6% pa. ese pa 2 Waa (espa, 14.At he te of fortetre of shares (a) share captal account credited win he caledp vale of shares foreded {0) share captal account debtes wer the face value of shares foreted Lic} share captal account is debted wit the caled-up valve of shares fortetes {@) share captal accounts nether debated not ceded 15. Tithe foleted shares ar re-issued, balance of Foreted Shares A‘ wie show #8 Sheet (a) as a separate tom (©) a2 4 part of te subscribe capt (C) as an temol reserve and supe 4d) asa par ol te paid-up captal 16, Proton re-eaue of shares is rantared to (a) Prot and Loss Account (©) Genera Reserve {@) Coptal Redempon Reserve \S>Captal Reserve 17. Shares are saved (a) forcash only (@) on creat ony ‘cash or for consiseration other than cash soitenpany can wave equty sares wih Serena ght as to chided, wong oP (a) tis authoreed by aricles of association only (0) he eave is euosed by spec rection only authorised bot by aficles of association and special resolston Jat tts stonand bom By tric ol aseciton and erry enkson10 Company Accounts mpatooweg sata ie ‘ aut sare cAbta ay be wen eterarel nts ce Shares 8 Gelned under the Compan Act ay ttn eae red Dares Act as hat pad of me share capt 8 Shares carry preferential nght m resect of derdends ° auty Sharos @re 2180 called ordinary shares o Se unpaid drvdend of any year wil have amy ob pas out o the profes oft subsequent years * arroncomaave praeronce shares (0) ue ramcipatng prolerence shares namlaive oars on {6 Non paricgating orterance shares (hee wrons dens of any yeas wil ap incase of roncumulsive prelerence shares, (0) Parkcoatng oelerance shares fe cumuatve preterence shares {a Non pascpatng proerence shares 10g anor spbuseaigorterece shares ae ented pact me su protts roman nad aridend to preference sharehoiders(b) dwidend tothe eauty shareholders 4e) (0) 90 (0) {6} ether (a) oF (>), whichever is nigher ‘5 ne wnout of capt! sate nthe Capa Cause of he Memorancum of Aasosston © cated (0) Subscribed Captal (a) issued Capital (@ Galea Captal (8) Nomeal Captal ‘x foe amount of captal actualy ofered 10 the pubic /shareholers = cated re Jaisaved Cantal {() Subscribed Canta (e) Caled-up Capital (6) Autorzed Capital ‘& The folowing statement is false olnnd captal can never be more han he aumoned ¢9040 han subserbed captal rp case of under subscrptor’, issued capaal ess 42 neato’ captal may be converted ino eserve C2Pt%, (Pad up capt is equal to Caled up Captal Leet Cale ooo er, ‘sk tmanmum subscripton is 9,000 shares of € 10 €2ch wand applications are recived onty fOr ‘4000 shares (a) aboment wil be mage pro~ata D nent wit bo mont and all appcaton meray wi De reas wat be no stornant and alappacaon money wi be heii {MA aloument wi De made ‘B.tegund Capital Less UNG subscription is equal tO etc a ‘(e) Reserve Capital {d) Paid-up capital st Peer ae cate pony cae of ein pte ene on cece wenn (6) Pau wiescivonlls povin ener a af rece Capel ees Memorandum “association of prvate Comm term of han gaven subacroe? Cente ate manent” SSE Sin ete smn ens < =e cpneaa Proportionate afopnent (6) Peer Ho orc anno ee er known — sere sa” Accountancy amd Financial Managem SBC, 38, Puc company sung esas pubic nee te wi REG! t Cong, ay Proenacie "9 () Statement in beu Of prospectus: (¢ Mamerancum tAssacaton (Shanes o kesoeaton ‘4 Capel Recaro Reserve (ahcanbe vseg mare tn st tity patbons se (2) can be ued tor manng party pa shares Ny oa 38 Do (©) ean be uted bem forthe sue oly pe onus shares an fr make ‘Shy oue ae bones (@)cantoe weed scaring bonus shares 85 Balancein Dobentre Resemptan Fund aerine Sebastes a8 deers (=) canbe useg orate av shin oy pad ves saree (0) can be used tor making party paid shares fully pad as bonus {2 canbe aac tot forth ao ay pba aa 3 9" AD Sy oe ‘ty one as sone (a) caret be vad ot cane bons areoiers 36 Exvacto Galan Shet ota ab on 3732017 ‘Uabimes ‘Share Capital 50,000 Equty Shares of 10 each 350,000 CCalls-r-arrars on 10,000 shares 20,000 Callsin-agvance on 40,000 shares 1.20.00 {Wal the shares are mace fuly paid up, the company wil receive an additonal amowe 427 50,000 (@) £30,000 (e) &1,50,000 (@)€1.20.000 ‘37.Upon toreture of share, share capital account's debited by (a) Paid up amount (©) Cateevarrears (6) Nominal vaise of such snares \J97Caked up amount 38. The Prot made on ressve of footed shares stranstemed fo Capital reserve (©) Captal redempson reserve (€) Genera reserve (6) Profe and toss Ale '30.X Co. Lid foreted 20 shares of F 10 each on which €'5 per share were pak. The so ‘ssved these shares @ €8 full pani up. Amount waneterre to captal reserve wil be (aeao ait 60 (ra (8100 40. nih ype of share may have dvdends in arears? Ua) Cumatve preered share (©) Commen share (€) Non-cumative petered share (6) Government secures (1.1na Diocoeebecongury toad 200 ay Sane wat a ‘aid. The shares were resssved upon payment 1.500. Amount tensioned cats Er wea © 00 Su tnetnd 30 stars of 10 sie pny Kara nope 42.X U9. each fully Called up, held | a Imonay a 3 pe rae are tal eal of €or share Nene eee Pp ee ae Tees pe man, Aon aac (a) 890 () 8240 ts (3 hoe ase 16 ABG tn maved 1000 sus ct 1000 ste pees per sna pga | Oe panos res cara pny nF graces ev loiedand ey woe auat io Care tora ener ASM the cal was made. The call money payable by Me Cheturest e (a) 4,000 ©) 800 ven (820010 Compeny Accounts ” 11g. scared sets Wor” 750000 fom HL by as of shares a8 100 at prom ct Se ie vos 1 be auedbyG Ls to aretha purchase coneranon wl D8 46.00 snares (0) 7500 snares 9375 sre (4) 5,625 shares: shearer, ite 200 share 10 each nc wore stam pha Oy MJ a i Sea a em, rar, The catcup vaue per snare was 9 On (ay 10.000 (bv) 2 8,000 12102000 naactt soe te gsi. 158080 2,000 shares of€ 10 aach. whch were lofted by creating Shae forteture ctbyt 3000. Thesa shares wore ts he umount tbe rors © sal Reserve nccount wl be oa er sae Te amu he eran (yt 3,000 (0) ® 2,000 SO res (on Ar Ud, aued 25,000 equty share of € 100 each ata prams off 15 each payable 38 oF septason so sooo ans aes arc opens ee 78,000 equtty shares but the company issued to them only 25,000 shares. Excess money was ‘Runded © hom ater asjstment for turer eas ast coon 500 shares were ot raceve peavove s the cose ot (a) Under subseripion (o)Prosat stort fe Forteeure of shares {a} Nove che above ‘akUintes Company purchased machine worn 1.15 000 kom Insan Traders. Payment was aeduaste 10.000 by cross cheque andthe enaing amount by asue of Equty Shares ofthe Gtevabect€ 10 each uly pat at an save pre ot® 0.0 each Amount of share perm wih ve (sy60c0 «@) 7.000 ye)s.000 (a 4000 Ine tmount 10 be colected on apcaton of srares shout be (aatesa han 5% of nominal vaive f shares nore than 9 of nominal value of shares {2 mae than 5% of caed v9 price of shar {@ioot more than 5% of ave price of shares sh ows share can Be iesued out of {agora exer ony (©) dividend equataston res0re only (Grteament atowonce rene ony soFallota, Bande above si Potton rosaue of forteted shares is Wansiored © (abshaecaptal account {e) general reserve account (6) ortotod mares account Sremam andthe promism money which i dy Po saguoes pram amount wi be a tolowe svman shares to be fortened are issued ot & ‘meived on the shares frteted, he treatment (@ secures premium account wil be futher erected (secures premium account wal be further debted + (€)ascurties promium account wi be transfered io capita reserve 4 None ofthe above ‘incase of oversubscripton tshares are, ‘on shares aiioned is (a) rtunded o the shareholders Jor adjusted against allotment money ‘Ate accearang ry eve woof ea s loted pro rata, the excess application money received (@) oreited (6) none of the above rometers for the services rendered by76 Accountancy and Financial Management (S. ¥.8.Com.: Sey, 55. The maximum amount beyond which a company 1s not allowed to raise funds, by issue of ie . (a) Issued capital (b) Called up capital {c) Paid up capital 40) Authorised capital 56. Which of the following statements is false with regard to Rights Issue 7 (a) Rights issue is made to the existing shareholders (©) in Rights issue too there is a chance of over-subscription and pro-rata allotment of shar (c} The price of a Rights share is much less than the existing market pnice per share (d) The floatation cost of Rights issue is low 57. Which of the following statements is true with regard to declaring and issuing of Bonus Shan] (a) Assets are transferred from the company to the shareholders 40) A Bonus issue results in decrease in retained earnings (c) Shareholders’ equity is reduced (d) A Bonus issue is same as deciaration of dividends 58.A Limited Company forfeited 100 equity shares of the face value of 2 10 each, 2 6 per called up, for non-payment of first call of 8 2 per share. The forfeited shares were sub: reissued as fully paid @ % 7 each. Amount transferred to capital reserve in this cases Ae 100 (b) % 400 (c) 8 700 (d) None of theses, 192 Accountancy and Financial Menaemen SI. &.__ OBJECTIVE QUESTIONS 1. The fotowng statements fase (a) A Company can sue preference shares whch are rodeomatia {©)A company can issue uredeemabie preference shares {6 The maxmum pened or redemption & normaly 20 years from the dae ot yg oar 2 The folowing stalement ste (a) Party p86 preterence shares can be redeemed {©) Pretorence shares on whch calls are unpac can be redeemed (©) Oni uly pad pret shares can be redeemed (6) None of me apove 3. Redeemable Preternce shares can be redeemed (2) only out of he proceeds of he tesh ssu0 of shares (©) only out of anasbie pros (©) out resn issue of shares andior out of the dvsibe profits (3) none ofthe above 4. ReseematiePretrence shars ardor ata premium, the rerun cara | {a) out ofthe company’s securty premium account {©) out of he protts of me company {€) out o he proceeds of he ean isave of shares at par {91 (a) and (0) above 5. Redempton of pat shaves (2) leads to reduction i authorised captal (2YGoes not change the authonsed captal ofthe company (¢) mereases the authorised captal (6) none ofthe above 6. Capital redemption reserve account can be used (@) for doctarng bonus for making party paid shares tly paid _ 18) for ieeuing fut paid up Donus shares tothe equty shareholsers {c) party forlssving fuly pad up bonus shares tothe equity shareholders and pay P| onus fr making party pak shares fuly pad (8) or none ofthe above | 7. The folowing balance isnot avalabe for ransler to Captal redemption reserve (a) General Reserve (©) Dividend Equalization Fund Ae Revaluation reserve (@) Profit and Loss Account ‘ {8 Which of the following balances is availabe fr transter to Capital Redempton Rese™t (0) Forteted Snares Account (©) Profit prior to Incorporation (€) lnvestment Alowance reserve (2) None of the above ‘9. When pret. shares are redeemed out of profits, the amount equal to the nominal vane ‘aaeered shoud be Yarden | (2) Capital Reserve Account 00) Capital Redemption Reserve Accout (0) Goren Rasore Account {6} Sting Fura Recoure 10. Whon prt shares are redeemed outof profes, te amount be ransteredt Capes RS core aroui be eal" {a Promim payaleonvedomotion 1 Crown payieonvesompon «ene mina vee of share eceemes - ~AG tre nomial value of Shares ademed logs premium received on rsh shupmnton of Preference Share 13 shares are redeemed a prem, such premium may on cay ies sonny bap oe fj preceeds ot resn save of shares (Gj Fodeted Snares Account aptal Redemption Reserve Account «Cao! redemption reserve nczount faymay Be C0109 ate opten of the company. on redemption of prot shares [plat be created to comply wah law. on redemption of pet snares ‘) must be created to comply wih aw. on conversion of pret shares to eanty shares {ts created out of Fores Shares Account. on lonotue of shares _g Tw Captal Redemption Reserve A’ can bo used for la)payrent of rvsena (b) wrting of accumulated losses (#00 of hily pad shares as bonus (d) ral ofthe above Lit of he fotowing statements aise [a Proceeds o res issue of shares, or he purpose ol redemption of pref, shares, equal © Face Vale of shares. {shares ara issued par 1) Proceeds o! resh issue o shares, forthe purpose of redempton of pret shares, equa! 19 Isaue prce of shares, # shares are ssued at promim (0 Proceeds o resh issue of shares, or ne purpose of redemption of pra. shares. 8 equal 0 he actual money received on the new shares he date ofredemption ofPreterence SMares (Att he above ‘en ol foloning redeemable pet. shares of € 10 are elgble for radeon ? (ton which appicaton and alotment money of €5 has bwen pad by cheque (o}on which appiicaton and alloenent money of €8 has been paid cash Laon which appicaton and alotment meney of € 10 has been pais (alll te above ‘kro. shares are redeemed by conversion na equty shares, ten, the amount ranstered 9 Capta! Redemption Reserve ona (equal ote face valve of pret, shares redeemad 6) equa to me face valuo of te equ share issued {8 aference between ho lace valve o! the prt. shares redeemed and the equty shares issued ‘Provisions regarding redemohon of pet shares are given in- ‘a)aacton 79 of Companies Act, 2013 (0) section 81 of Companies Act 2013 section 77A of Conpanies Act. 2013 (a) rone othe above ‘toaunce of Gaptal Redemption Reserve Account is shown under Labibes se of the Balance ‘Sheet undo (Share Capita (0) Secured Loans “er Reserves and Suplus La hisslielemmenrsd "Ntaance of Capital redemotion Reserve Account can be vized for - (payment of cividend (declaring bonus to make party paid shares into uly pal up shares fa) oF) S2rHone of (a) or (0) 2. on toreture of le pro, shares is ceded to (©) Captal Redemption Reserve Ae (6) General Reserve Ae SITEIC carn nue yt aaron (0) edeomaba nocd pr. hare Bay coreang pot snares (STedeemabl prt. shares re aoet Sstaearesy ronda tea was caged iat com, ‘prof ommerwise available tor distribution by way of of proceeds of fresh ive andor ‘adenAcrommancy ered Financia} Memenrmemr SRC, 23 To te exton preterence shares have been redeemed Out of DOS. amour valve of preference shares redeemed shoud be Wranslered 19 (8) Development Rebate Resorve (©) Geceral Reserve (6) Sinking Fund (a) Capen! Redomoton Reserve 24 X Co. Ltd has to regoem 1,000 praterence shares of € 100 #aCP at 19 pero 's8ues 8,000 equity shares of 10 each at 10 per cont General Reserve am captal redemption reserve wil be (@) 1.00000 (0)? 50.000 (©) 858,000 (8 1.10,000 25.A.company cannot weve redeemabepretarence shares or 4 per0 exc neding (a) 6 years ()7 years (c) 8 years () 20 years 26.4 company can issue redeemable preterence shares (@) only at par (0) only at remun (©) only at count {0} onty (a) 0° (0) 27 S Lid. sued 2.000, 10% Preterence shares off 100 each at 08", Whi are redeerang | remium of 10%. For the purpose of redemption. the company issued 1.500 Eauty Sen, £100 each at a premium of 20% per share, At he te of recempton af Proleronce See ‘amount to be translerred by the company 16 the Captal Redemption Fese we Acco (@)® 50,000 (©) ¥ 40.000 {€) ®2.00,000 (2) £220,000 | 28. Light Lid. has 10,000 5% preterence shares of & 10 each to be redeemed ater § yer ‘company forteted 500 preference shares on which fina call off 2has not beer recrnee due note ana canceled these shares on account of redemption Remaswg svc redeemed out of reserves of the company. The amount to be credted "0 capta ears reserve wit be (a)€ 1,00,000 (©) £95,000 (e) €99,000 (a) 899,500 29. Inigo Ltd. had 10.000, 10% redeemable preterance shares of & 10 each, fuly pad.2+) 1,000 10% Redeemable Preference shares off 10 each party paid-up. The comsary a 1 redeem preterence shares at par by he issue of sutfcrent number of eauty shares 2” ‘each fuby paid up at par. The numberof equity shares sssued should be (4) 9.000 (©) 11,000 (@) 10.000 (4) None of re above up. The company deccedtoredeom tse prelronce shares apa” by Sas taster = of equity shares of € 10 each ata premum of € 2 per share as ily pac up. The mo" | Iransterted to capital redemption reserve account wil be (2) 10.00.00 (©)® 1200.000 | (@) €8.00.000 (oni 31. Which of te folowing statements s NOT TRUE with regard to redemption of Peter (a) Party paid shares cannot be redeemed ABT Te redemption of Preference shares shal be taken as reduction of comoamy + #27) share captal (c) Preterence share can be redeemed eter out of he proft or amount ol esh ss {6} None ofthe above £32, Wen Redeemable Preterence share are due fc redemption, the entry passed is (a) Debt redeemable prelerence share captal alc, creat cash ale : 0} Dab redeemable preference share captal al: cred preterence share holes 3 (€) Debit preference share holders ak; crt cash ale (6) Debt proterence share holders a: cect captal reduction ale 9. Which of the folowing cannot be Witzed fr the redemption of preerence share = cl ef sae Oe Sree hho nana Ta) Dividend equalization reserve: Ejon of Preference Shares 155 which of the folowing statements ‘s taise {a) Redeemable preterence share can be issued i autnonzed by the artcies of association (orCapaal Redemption Reserve cannot be used tor :ssue of fuly pad bonus shares Ug) Redeemable preference share can be redeemed only when they are fly pad (@ Redeemable preterence shares can be redeemed out of protits of the company g.ALid. Company has to redeem Redeemabie Praterence Shares of tne value of ? 1.00000 'or which the company has issued 3.000 equity snares of ? 10 each at a premum of 10% The smount to be transferred to Captal Redemption Reserve Account will be (a) @ 1,00,000 () ® 70.000 (€) © 1.10.000 (8) 267.000 se.From which of the following accounts can transfer be made to captal redemption reserve on redemption of preference shares 7 (@) Secunties Premium (0) Captal Reserve (©) Profits Prior to Incorporation (0) General Reserve .The term ‘Divisible Profits’ means \{a) Profit available to shareholders for distributon as dividend (0) Profit as per P& L a/c (c) Profit as per P& L appropriation ac (@) None of the above ‘BA company has issued 20,000 equity shares of 10 each. at a premium of 10%, to redeem 90,000 prelerence shares of % 10 each. The amount to be transferred to Capital Recempton Reserve is (a) % 2,00,000 (b) 2,20.000 ey 1,00,000 (d) None of the above3, The prof eamed ater incorporation (a) deere avenue come eames bythe company venue pros ear com () 18 capAat profit sened by he compeny (9) Belongs to the vendors of te erstwhile business For the purpose of compunng pro! prior to ncorporatin, (2) Gross prott is divided in Time Ratio (©) Gross profit is divided in Sales Rato (€) Gross profit is assumed to have ansen entirely in the postincorporation pened (6) Gross profit is assumed to have ansen entiely n the pre-ncorporation pend 5, For the purpose of computing profit par to incorporation, Gross profits divided in Sales Rato (a) based on the assumption that the amount of Gross profit per month remains the same (0) based on the assumption that the Gross Protit Rabo is he same during the {(€) based on the assumption that the amount of sales per month remains the $8/M@ (d) based on the assumption that the Net Proft Rat is the same dung the year 6. Ifthe Gross Profit Ratio has changed due to change in sales prices, for the purpose of computing profit prior to incorporation, {a} Gross proft cannot be divided in Sales Ratio (0) Gross profit can be divided in Sales Ratio {¢) Gross profit should be divided in Ratio of Sales prices {¢) Gross profit should be divided in Ratio of Cost per unt Je gross profi is divided in the ratio of bme, for the purase of computing oft prior to incorporation, {a) Ifthe detais regarding stocks are not avaiable {0) I! the details regarding cost per unit are not avaiable {@) Ifthe detais regarding sales are not avalable {@) Ifthe details regarding purchases are te ‘available: a Se et ca on Fe yng nt gt Sc computing profit prior 10 incorporaon a an oregon nono (oy he groes profs {ey tw prone prom a raced tn ato of rect wages, lr the purpose of compung PM Pr $e a ie divided in the rao of te, for he purpose of computing POM prior to profits, Interest to vendor on purchase consideration ooo postincorporaion expenditure {€) is allocated in sales rato baron ohne ee ont nt (ec reed as prencreraton sep (Offa treated as postincomporatn expenshure * (@) fe aocated in time rato (@)is allocated in sales ratioase Accountancy and Financial Management (S.¥.8.Com. SEM 1, 11 For compuing preincorporaton profits. Osicount on debentures Wo (2) weated a8 pxe:ncorporaton expenditure (O)48 Heated a8 post ncomoraton expandre () allocated in te ratio (0) located i sales ato 12.For computing pre incorporation pots, Share sve Expenses wio (2) 8 treated a8 presncomoraton expendtire (0) treated as postincomoraton expendture (6) atocated i ome ato (0) 18 allocated in sales ratio 13. For computing presncorporation profts, Share Tandlor Fees Recewvod 42); rented as postincorporation ncome (0) Wealed a8 post ncoreraton expenditure {€) alocates 9 we rato (3) 4 Wome as presncorporation core "4. For computing pre-incorpration profi, Omidend declared on shares 8 (a) i weated as postincorporaten come {Hs tealed a8 postsncorporaton appropnaton (©) alocated tne rato (a) treated as presncorporatonapproeranon 18.For computing pre-ncorporaton pots, Freght Ouward (2) woated as presncorperaton expendure (0) allocated in purchase rao (©) alocated tee rato (a) allocated in sais rato 16.For compug pre-ncorporaton profs, Depreciation {@) 6 treated as presncorporaton expencture (0) wroated as post incorporation expencture (€) allocated in tm rato (6) 8 located in sales rato é 17.For computing presncomoration pots /Avdt Fee [Ds Weated as postncopomton xpenature {@)'s abot in tne rato {G6 atocated i rato of axaba ncome/ pots ort nas ncorpoated on 1420170 ake ove a busines hom 11-2017, Rar was 282 ae 82017 anda to rte a 12200 pn OL 31-12 2017, Books os 259.000 Hi22017, Asean of Ran between Pro and Post ncorpraton Pero (6) 3.000 : 8.280 at profit of ® 45,000 ahr debitng al expenses of & 75,000. The sales 5 ‘and Postincorporation periods is 2 : 3. Find out the atocaton of GS : () 30,000 : 45,000 sco equired the business ofa fem wet. 1-4-2016. The company was Z ¢ eemenced ts business of 1-12-2016. hs monty sales doubled hom Pe Se man monthly sales trom the date of cenficate of commencement of Buses ort areProfit Prior to Incorporation 2s (a) 15-2016 18-2016 132018, 18 For computig pre-econ esac ;Poraon prot, Sala {a Treates as pre-nc Ie yl vendor ay re-incomporation expenditure pice necro Soest te ey gam ty in Gemcmpeieremesgmceuy=anins {p) Treated as postincorporation ex iro poreermainoees Gamcimnnea tang etn pp os onnnens (2) Treated as pre-incorporation expenditure: Deve (py Treated as post-incorporation expenditure Cane eee aoe ee mans Seca Se ect oe ieee ree aeons Pet anya emo oman ern ron tet ere Btn sac, Len (a) Treated as pre-Incorporation expenditure i eae Sitti ae eee eeeo 2 nen 0 yration expenditure282 Accountancy and Financial Management (S.¥.B.Com.: SEM-1\) 33. Profits pnor to incorporation are available for (a) Payment of dividend (b) Payment of interest on debentures (c) Payment ot cost of fixed assets (a) None of the above 34. Profits prior to incorporation should be transferred 10 (a) Profit and Loss A/c (0) Capaal Reserve (c) General Reserve (4) None of the above 35. Preliminary expenses written off should be charged to (a) Pre-incorporation Profit {0} Post-incorporation Profit (c) Trading Account (d) None of these