50.1K

Verified Solution

Link Copied!

Refer to the information below extracted on March 31st, 2017 and prepare the Income statement of the company for the year 2016-2017

Particulars Dr. (Rs. '000) Cr. (Rs. '000) Administration Expenses 480 Cash at Bank and on Hand 228 Cash Received on Sale of Fittings 10 Long-Term Loan 70 Investments 200 Depreciation on Fixtures, Fittings, Tools and Equipment 260 (1st April, 2016) Distribution Costs 102 Factory Closure Costs 60 Fixtures, Fittings, Tools and Equipment at Cost 680 Profit & Loss Account (at 1st April, 2016) 80 Purchase of Equipment 120 Purchases of Goods for Resale 1710 Sales (net of Excise Duty) 3,000 Share Capital (1,00,000 shares of Rs 10 each fully paid) 1,000 Stock (at 1st April, 2016) 140 Trade Creditors 80 Trade Debtors 780 4,500 4,500 Additional Information: (1) The stock on 31st March, 2017 (valued at the lower cost or net realizable value) was estimated to be worth Rs. 2,00,000. (2) Fixtures, fittings, tools and equipment are all related to administration. Depreciation is charged at a rate of 20% per annum on the cost. A full year's depreciation is charged in the year of acquisition, but no depreciation is charged in the year of disposal. (3) During the fiscal year from 1st April, 2016 to 31st March, 2017, the Company purchased equipment worth Rs. 1,20,000. It also sold some fittings (which had originally cost Rs. 60,000) for Rs. 10,000 and for which depreciation of Rs. 30,000 had been set aside. (4) The average income tax for the company is 50%. Factory closure cost is to be presumed as an allowable expenditure for income tax purposes. (5) The company proposes to pay a dividend of 20% per Equity Share

Answer & Explanation Solved by verified expert

See Answer