15 April 2018
Question:- X limited commenced operations on 01 .04.2013 Following are some of the details prepared by accountant
Proposed Equity Dividend 40,000 Preference Dividend paid on preference capital at 15 % 15,000 Interest paid on loan borrowed 20,000 Selling & Distribution Expenses 30,000 Gross Profit Ratio 30% on sales Depreciation 5% on Sales Fixed Assets turnover ratio (based on Net Fixed Assets) 2 Times Interest Coverage Ratio 6 Times Debt Service Coverage ratio 2.75 times Debtor Turnover Ratio 4 Times Creditors turnover ratio (purchase and trading expenses) 6 times Stock Turnover Ratio 5 times
Notes: A Equity Dividend is proposed at 20 % of equity capital B Depreciation does not form part of cost of Goods sold C The loan borrowed on 01.10.2013. The first installment including interest was paid on 31.03.14 The loan was to be paid in ten semiannual installments. D Income Tax @ 30%
You are required to prepare for the year ended 31.03.2014 a) The profit & loss account b) Balance Sheet c) Cash Flow Statement.
17 April 2018
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