pls suggest ???????????

AS 616 views 4 replies
User Avatar

Job
222 Points Joined December 2008

 

 

regarding AS-23

 

BRIGHT Ltd. Acquired 30% of East India Ltd. Shares for Rs. 2,00,000 on 01-06-09. By such an acquisition Bright can excise significant influence over East India Ltd. During the financial year ending on 31-03-09 East India earned profits Rs. 80,000 and declared a dividend of Rs. 50,000 on 12-08-2009. East India reported earnings of Rs. 3,00,000 for the financial year 31-03-2010 and declared dividend of rs. 60,000 on 12-06-2010

 

Calculate the carrying amount of investment in

 Consolidated financial statement of Bright Ltd. As on 31-03-2010

 

Can anyone pls solve ???? its very urgent ????

Reply Share Follow
On 24 February 2011 at 14:45 Report
Replies (4)
Guest

 

Separate Financial Statements of Bright Ltd as at 31.03.2010: To be disclosed in accordance 
with AS 13 - Accounting for Investments, i.e. at Cost as follows
 
Particulars  
 
Cost of Acquisition                                                                                                           2,00,000
 
Less:    Pre Acquisition Period Dividend (Rs.50,000 × Bright Ltd’s Share 30%)     (15,000)
 
 Net Cost = To be disclosed in Separate Financial Statements                         1,85,000
Reply
On 24 February 2011 at 15:29
User Avatar

Job
222 Points Joined December 2008

sir,

we answered for stand alone financial statement ( Seperate finanical statement)

can u pls answer me wht will be the investment amount in Bright's Consolidated financial statement 

(Assume East India Ltd is associated of Bright Ltd.)  

Apply AS-23 and answer

Reply
On 24 February 2011 at 15:55
Guest

 

Consolidated Financial Statements of Bright Ltd as at 31.03.2010:  To be disclosed in 
accordance with AS 23 Accounting for Investment  in  Associates,  i.e.  as  per  Equity  Method  as 
follows: 
 
    Particulars 
 
  Net Cost as per Separate Financial Statements        1,85,000  
Less:    Pre Acquisition Period Reserves (Rs.30,000 × Bright Ltd’s Share 30%)   (9,000)
Add: Share of post Acquisition Period Reserves (Rs.3,00,000 × Bright Ltd’s Share 30%)     90,000  
 
Carrying Amount in Consolidated Balance sheet      2,66,000
 
 
 
Note: 1. Dividends actually received before the date of Balance Sheet should be considered. Dividends 
after the Balance Sheet date, 31.03.2010 should not be considered. 
 
 
2. It is assumed that East India Ltd did not have any other Reserves other than those earned during 
Financial Year 2008–09 and 2009–10. 
The amount of Goodwill / Capital Reserve on Consolidation is not ascertainable, since the Amount of 
Net Assets attributable to Bright Ltd is not given. 
Reply
On 24 February 2011 at 17:31
User Avatar

Job
222 Points Joined December 2008

according to me the answer for the above mention question is Rs. 260,000

Value of Investment : 2,00,000.00

Less: Pre Acu. Dividend 50,000*30% (08-09) 15,000.00

Add : Post Acu. Profits i.e from 01.06.2009 to 31.03.2010 3,00,000.00 / 12 * 10 * 30% 75,000.00

Show in CBS as per AS-23 2,60,000.00

sir can u pls tell me why we deduct pre profits 

and post profits is not Rs 3,00,000/- its 3,00,000/12*10

pls reply

Reply
On 25 February 2011 at 10:57


CCI Pro

Leave a Reply

Post Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Recent Threads

More recent discussions | Post

Related Threads
Loading