Accountancy & Auditing, Paper I

Required: Offer your comments on each of the above regarding their adequacy or otherwise.

Particulars Debit Rs. Credit Rs. Capital 6400000 Drawings 1813800 Goodwill 3618200 Land & Buildings 2400000 Plant & Machinery 1600000 Loose Tools 120000 Bills Receivable 145800 Bills Payable 1352000 Creditors 3068840 Purchase Returns 106000 Sales 8720000 Stock, 1st Jan 2011 1677800 Purchases 2050800 Wages 858000 Carriage Outward 22160 Carriage inward 55000 Coal & gases 234160 Salaries 1414560 Rent, Rates & Taxes 113000 Discount 60520 Cash at Bank 1016840 Cash in Hand 18600 Sundry Debtors 1800000 Repairs & maintenance 74600 Printing & Stationery 20600 Bad Debts 48520 Advertisements 140840 Sales Returns 85000 Furniture 48000 General Expenses 210040 19646840 19646840 The following adjustments are to be made: Closing Stock as on December 31, 2011 was Rs 1400000. Depreciation is to be provided on the following assets: Plant & Machinery 10%, Loose Tools 10%, Furniture 10%, Land & Buildings 2.5% Provide for the following payables: Wages - Rs. 60000, Advertisements – Rs. 20000, Salaries - Rs. 120000, Repairs & Maintenance – Rs. 15000 Provide 5% on the debtors against bad debts and 2% against discounts. Required: Prepare Trading, Profit & Loss Account and Balance Sheet as at December 31, 2011 from the above Data.

Review salient features of Zero-based Budgeting. Who authored it? Is it relevant to conditions prevailing in Pakistan? Present your view point candidly.

Present legal requirements governing preparation of financial statements of an Insurance Company under Insurance Ordinance, 2000. Illustrate your answer wherever your can.

G and D are equal partners in a business in which the books are kept by single entry. Their position on July 01, 2012 was as under: Liabilities Rs. Assets Rs Bills Payable 62000 Cash in Hand 2700 Sundry Creditors 200000 Cash in Bank 138800 Capital Accounts G Rs 800000 Bills Receivable 46000 Capital Accounts D Rs 800000 Sundry Debtors 486500 Stock 338000 Plant & Machinery 800000 Furniture & fixture 50000 1862000 1862000 The following existed as state of affairs as on June 30, 2012. Cash in hand Rs 4000 Cash at bank Rs 158000 Sundry Creditors Rs 212000 Stock Rs 367000 Sundry debtors Rs 668000 Bills Payable Rs 6000 Bills Receivable Rs 88000 Plant & Machinery is to be depreciated at 10% Required: Calculate the profit for the year ended on June 30, 2012 and draw up the statement of affairs as on that date showing the accounts of the partners in details assuming G withdrew Rs.100000 and D withdrew Rs.80000 during the year.

Currently there is a growing interest of more and more disclosure in financial reports of corporate. You are required to first list and then explain the following:- 1. Rationale behind the above movement. 2. Push forces behind the above trends. 3. How for one should go for full disclosure? Where one should stop?

Define and illustrate the following: