(three requests)

1.

2.

3.

CPP-Final Accounts (10 Marks) Question: 1 _The opening balance sheet and income statement for the year 2016 of Chand LLC., are as follows: LIABILITES OMR ASSETS OMR Share Capital 700,000 Plant & Machinery(new) 600,000 10% Debentures 200,000 Furniture Current Liabilities 200,000 Inventory 120.000 Debtors 100,000 Cash 200,000 1.100.000 1,100,000 80,000 Income statement for the year ended 31" December 2016 Particulars OMR OMR Sales 2,000,000 Less: cost of goods sold: Opening Inventory (FIFO) 120,000 Purchases 1,420,000 1.540,000 Closing Inventory 140,000 1,400,000 Gross Profit 600,000 Less: Operating expenses 308,000 Interest on debentures 20,000 Depreciation on Machinery 90,000 Depreciation on furniture 8,000 426,000 Net Profit 174,000 Debtors and current liabilities remained unchanged throughout the year. Interest on debentures was paid on 31.12.2016. The general price index during the year was as follows: On 1.1.2016 --- ---300 On 3.12.216----- ---360 Average for the year--------320 You are required to prepare the final accounts for the year 1996, after adjusting for the price level changes under CPP method. Conversion method or Restatement of income method. Solution: Income statement of Chand LLC restated as per CPP method for the year ended 31st December 2016 Particulars HCA(OMR) Conversion CPP (OMR) Factor 1.74,000 Retained Final answer = Working note: Statement showing gain or loss on monetary items Particulars HCA(OMR) Conversion CPP (OMR) Factor Net monetary assets on 31.12.90 Monetary assets on HCA basis Loss on general price level 1.52,000 Final answer = Balance sheet of Chand LLC., as on 31.12.2016 Liabilities HCA(RO) CF CPP(RO) Assets HCA(RO) CF CPP(RO) Final answer = Cash 4,52,000 360/360 4,52,000 12,74,000 14.07.900 12,74.000 14.07.900 CPP-Final Accounts (10 Marks) Question: 1 _The opening balance sheet and income statement for the year 2016 of Chand LLC., are as follows: LIABILITES OMR ASSETS OMR Share Capital 700,000 Plant & Machinery(new) 600,000 10% Debentures 200,000 Furniture Current Liabilities 200,000 Inventory 120.000 Debtors 100,000 Cash 200,000 1.100.000 1,100,000 80,000 Income statement for the year ended 31" December 2016 Particulars OMR OMR Sales 2,000,000 Less: cost of goods sold: Opening Inventory (FIFO) 120,000 Purchases 1,420,000 1.540,000 Closing Inventory 140,000 1,400,000 Gross Profit 600,000 Less: Operating expenses 308,000 Interest on debentures 20,000 Depreciation on Machinery 90,000 Depreciation on furniture 8,000 426,000 Net Profit 174,000 Debtors and current liabilities remained unchanged throughout the year. Interest on debentures was paid on 31.12.2016. The general price index during the year was as follows: On 1.1.2016 --- ---300 On 3.12.216----- ---360 Average for the year--------320 You are required to prepare the final accounts for the year 1996, after adjusting for the price level changes under CPP method. Conversion method or Restatement of income method. Solution: Income statement of Chand LLC restated as per CPP method for the year ended 31st December 2016 Particulars HCA(OMR) Conversion CPP (OMR) Factor 1.74,000 Retained Final answer = Working note: Statement showing gain or loss on monetary items Particulars HCA(OMR) Conversion CPP (OMR) Factor Net monetary assets on 31.12.90 Monetary assets on HCA basis Loss on general price level 1.52,000 Final answer = Balance sheet of Chand LLC., as on 31.12.2016 Liabilities HCA(RO) CF CPP(RO) Assets HCA(RO) CF CPP(RO) Final answer = Cash 4,52,000 360/360 4,52,000 12,74,000 14.07.900 12,74.000 14.07.900