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CMA Intermediate · Financial Accounting · Final Accounts of Commercial Organisations

Mehta Ltd's equity share capital: authorised 1,00,000 shares of Rs 10 each; issued 60,000 shares; subscribed 58,000 shares, all called Rs 10 per share. Calls in arrears are Rs 20,000 (including Rs 5,000 from a director). Securities premium is Rs 1,50,000 and general reserve Rs 80,000. Surplus in the statement of profit and loss shows a debit balance of Rs 30,000. What is the total shareholders' funds?

Shareholders' funds are Rs 7,60,000. Paid-up capital is Rs 5,80,000 less calls in arrears of Rs 20,000, giving Rs 5,60,000. Adding securities premium of Rs 1,50,000 and general reserve of Rs 80,000 and deducting the Rs 30,000 deficit gives Rs 7,60,000.

  1. ARs 7,60,000Correct
  2. BRs 7,80,000
  3. CRs 7,85,000
  4. DRs 8,00,000

Explanation

Subscribed and called capital = 58,000 x 10 = 5,80,000. Less calls in arrears 20,000 = 5,60,000 paid-up. Add securities premium 1,50,000 and general reserve 80,000 = 7,90,000. Less debit surplus 30,000 = 7,60,000. Rs 7,80,000 comes from ignoring the deficit but also...; Rs 7,90,000-based options mishandle arrears or the deficit.

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