Question

Knowledge Park Ltd. requires your assistance in quantifying/classifying certain items as per Schedule III of the Companies Act, 2013:

Particulars	₹	Particulars	₹
Equity Share Capital	10,00,000	Bank Overdraft	70,000
Franchise Fee paid	4,20,000	Calls-in-Advance	50,000
Provision for Tax	1,00,000	Goodwill	2,50,000
Cash-in-Hand	3,00,000	Cheques-in-Hand	6,00,000
9% Debentures	5,00,000	Building	7,70,000
Patents	5,25,000	Deposits with bank with more than 12 months maturity	5,00,000
Bonds	6,50,000	Computer Software	2,10,000
Loan from SBI for 3 years	3,40,000	Premises	6,00,000
8% Preference Share Capital	1,00,000	Publishing Rights	2,20,000
Margin money with Bank	8,10,000
Premium on Redemption of Debentures	1,00,000

Based on the above information, answer the following questions.

1. Cash and Cash Equivalent is ______.
   1. ₹ 22,10,000
   2. ₹ 16,70,000
   3. ₹ 21,40,000
   4. ₹ 14,00,000
2. Correct heading and sub-heading for 'Bank Deposits with more than 12 months maturity':
   1. Current Assets - Current Investments
   2. Non-current Assets - Property, Plant and Equipment
   3. Current Assets - Cash & Cash equivalents
   4. Current Assets - Other Current Assets
3. Total value of Intangible Assets is ______.
   1. ₹ 12,05,000
   2. ₹ 11,00,000
   3. ₹ 21,55,000
   4. ₹ 16,25,000
4. Long-term Borrowings to be shown in the Balance Sheet are ______.
   1. ₹ 14,90,000
   2. ₹ 15,90,000
   3. ₹ 8,40,000
   4. None of these.

Answer 1

1. Cash and Cash Equivalent is ₹ 14,00,000.
2. Current Assets - Cash & Cash equivalents
3. Total value of Intangible Assets is ₹ 16,25,000.
4. Long-term Borrowings to be shown in the Balance Sheet are ₹ 14,90,000.

Explanation:

A.

Cash-in-Hand = ₹ 3,00,000

Cheques-in-Hand = ₹ 6,00,000

Bank Deposits (12 months) = ₹ 5,00,000

= 3,00,000 + 6,00,000 + 5,00,000

= ₹ 14,00,000

B. All bank deposits are part of cash balances. They are classified under Cash & Cash equivalents.

C.

Franchise Fee paid = ₹ 4,20,000

Patents = ₹ 5,25,000

Goodwill = ₹ 2,50,000

Computer Software =  ₹ 2,10,000

Publishing Rights = ₹ 2,20,000

= 4,20,000 + 5,25,000 + 2,50,000 + 2,10,000 + 2,20,000

= ₹ 16,25,000

D.

9% Debentures =  ₹ 5,00,000

Bonds: ₹ 6,50,000

Loan from SBI (3 years) = ₹ 3,40,000

= 5,00,000 + 6,50,000 + 3,40,000

= ₹ 14,90,000