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CA Intermediate · Advanced Accounting · Financial Statements of Companies

Kaveri Industries Ltd. reports the following at year end: Equity share capital Rs. 40,00,000; Securities premium Rs. 6,00,000; Surplus in Statement of Profit and Loss (credit) Rs. 9,00,000; Capital reserve Rs. 2,00,000; Money received against share warrants Rs. 1,00,000. Under Schedule III, what is the total of 'Shareholders' funds' (Equity) shown in the Balance Sheet?

Shareholders' funds are Rs. 58,00,000. This is share capital of Rs. 40,00,000, reserves and surplus of Rs. 17,00,000 (premium, surplus, capital reserve) and Rs. 1,00,000 share warrant money, all of which form part of equity under Schedule III.

  1. ARs. 57,00,000
  2. BRs. 58,00,000Correct
  3. CRs. 56,00,000
  4. DRs. 49,00,000

Explanation

Shareholders' funds under Schedule III include share capital, reserves and surplus, and money received against share warrants. Reserves and surplus = 6,00,000 + 9,00,000 + 2,00,000 = 17,00,000. Total = 40,00,000 + 17,00,000 + 1,00,000 = 58,00,000. Rs. 57,00,000 omits the share warrants money.

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