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Assignment Instructions The newly appointed accountant of a start - up company Pioneer Limited , which has got funding by Peyush Bansal in Shark Tank

Assignment Instructions
The newly appointed accountant of a start-up company Pioneer Limited, which has got funding by Peyush Bansal in Shark Tank against issue of shares, has prepared the following trial balance from the details compiled by him for two years as follows:
Trial balance for the year ended Mar 31,2022
Account Title
Head of Account
Debit Amount ()
Credit Amount ()
Share Capital
Non- Current liability
5,00,000
Bank Loan
Non-Current liability
1,00,000
Share capital - Peyush Bansal
Non-Current liability
1,00,000
Trade payable
Current liability
50,000
Outstanding Rent
Current liability
5,000
Other current liabilities
Current liability
80,000
Equipment
Non-current tangible asset
2,00,000
Furniture
Non-current tangible asset
4,00,000
Patents
Non-current tangible asset
1,00,000
Investment by Peyush Bansal- cash received
Current investment
1,00,000
Trade receivables
Current asset
80,000
Cash balance
Current asset
5,000
Bank balance
Current asset
2,00,000
Revenue
Indirect Income
3,60,000
Purchases
Direct Expense
1,00,000
Salaries
Direct Expense
20,000
Rent of building
Indirect Expense
10,000
Accumulated Depreciation on tangible assets
Direct Expenses
50,000
Dividend expense during the year
Indirect Expense
30,000
17,95,000
6,95,000
Task 1
Now, the accountant is confused as regards two things:
1. Whether the classification of Head of Account is correct?
2. Whether the classification under debit or credit is correct?
You are required to give the correct classification for the above accounts mentioned in the Trial balance above.
Also, by making corrections to what will be correctly debited or credited to the Trial Balance, prepare a corrected trial balance for the year ended Mar 31,2022.
For Task 2 onwards, the following notes need to be considered:
a) There is no opening stock for the company.
b) Closing Stock as on 31.03.2022 is 50,000
c) Dep per year is calculated at the below rates:
Equipment -10% on cost
Furniture -7.5% on cost
d) Patents are not to be amortised
e) During the year, new equipment was purchased for 1,00,000(Dep to be accounted for the full year)
f) At the start of the year, Furniture costing 50,000(Carrying value 40,000) was sold at a loss of 5,000(No Dep for current year to be accounted for)
Task 2:
You are required to prepare a Profit and loss account for the year ended Mar 31,2022.
Task 3:
You are also required to prepare Balance Sheet for Pioneer Limited as on Mar 31,2022.
Task 4:
Pioneer Limited is unable to assess the cash and liquidity position of the company based on the above Profit and Loss Account and Balance Sheet. You are required to help the management by preparing the Cash flow Statement for the year ended Mar 31,2022.
Following additional information is made available for you:
a) Dividend paid during the year =30,000
b) Opening balances as on 01.04.2021 are as follows:
i) Patents =35,000
ii) Investments by Peyush Bansal =0
iii) Trade receivable =40,000
iv) Cash Balance =3,000
v) Bank Balance=20,000
vi) Share capital =5,00,000
vii) Bank Loan =50,000
viii) Trade payables =55,000
ix) Outstanding Rent =3,000
x) Other current liabilities=40,000
xi) Reserves and Surplus =0
Task 5:
The management of the company is asking you to analyse the performance and Cash flow of Pioneer Limited for the year ended 31 Mar 2022, making specific reference to any concerns or expectations regarding future periods, with the help of various ratios to support your analysis.
Part 6:
The auditor of the company, M/s JBL Co. and Associates is planning to conduct internal control risk audit for the year ended 31 Mar 2022 on the request to the new investor, Mr. Peyush Bansal to ensure there are no shortcomings in the working and management of the company. You are required identify and describe any five potential risks related to the internal control of the company and also, what should be the auditor`s response to address those risks.

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