Financial Accounting-Preparation and Presentation of Company Final Accounts [IAS (Admin.) Mains Commerce Accountancy]: Questions 1 - 3 of 5

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Question 1

Describe in Detail Subjective▾

Explain the concepts of Capital Asset Pricing Model and Arbitrage Pricing theory supported by illustrations with major differences between them. (20 marks)

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Explanation

The Capital Asset Pricing Model (CAPM)

It is a tool of the Asset-Pricing Theory. The concept was introduced in the 1960s and is considered to be the work of William F. Sharpe, Jack Treynor, John Lintner, and John Mossin but the major contribution is attributed to Willian Sharpe.

The concept explains the relationship between expected return from asset…

… (935 more equations, 62 figures) …

Question 2

Appeared in Year: 2016

Write in Short Short Answer▾

Answer the following in about 150 words each:

Explain Pooling of Interest Method of amalgamation of companies.

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Question 3

Appeared in Year: 2020

Describe in Detail Subjective▾

The following information relates to Cloud Ltd. as on 31.03. 20XI:

Information Relates to Cloud Ltd

The following scheme was duly agreed and approved by the court:

(i) The shares were sub-divided into shares of ₹ 5 each and 90 per cent of the shares were surrendered.

(ii) The total claims of debenture holders were reduced to ₹ 59,000 and in consideration of this, they were also allotted shares (out of surrendered shares) amounting to ₹ 20,000.

(iii) The creditors agreed to reduce their claims to 30,000, of which was satisfied by issue of equity shares out of those surrendered.

(iv) The shares surrendered but not re-issued were cancelled.

You are required to draft the necessary journal entries for the reconstruction. (Paper-I)

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Explanation

Journal Entries of Cloud Ltd. (reconstruction)

Journal Entries of Cloud Ltd
DateParticularsDebit (₹)Credit (₹)
1Equity Share Capital (Rs 100/-) A/c Dr2,00, 000
To Equity Share Capital (₹ 5/-) A/c2,00, 000
(Being Sub-division of 2,000 equity shares of ₹ 100/- each into 40,000 equity shares of ₹ 5/- each)
2Equity Share Capital A/c Dr1,80, 000

… (255 more words) …