Following Balance Sheet of M/S Combined Industries relates to the year ended December 31, 2000.
|
Asset
|
Rs
|
Liabilities and equipment
|
Rs
|
|
Cash
Account Recievable
Inventory
Unexpired insurance
Plant and equipment
|
200,000
650,000
800,000
40,000
1,150,000
2,840,000
|
Accured expense
Loan payable
Account payable
Capital stock
surplus
|
25,000
200,000
650,000
1,000,000
965,000
2,840,000
|
Additional information:
1. Possibility of bad debts on Accounts Receivable has not been considered yet. It is estimated that bad debts will Rs. 20,000.
2. Rs. 150,000 representing cost of large scale newspaper. Advertising campaign to be completed in year 2000 has been included in the inventories. It is also found that inventories include merchandise Rs. 65,000 received on December 31, 2000 has not been recorded as purchases.
3. Un-expired insurance consists of Rs. 4,000. The cost of fire insurance for the year 2000 is Rs. 31,000 includes the cash surrender value of officer life insurance policy.
4. Books show that plant & equipment has a cost of Rs. 2,000,000 with depreciation of Rs. 850,000 recognized in prior years. However, the balances include fully depreciated equipment of Rs. 150,000 that has been scraped and is no longer in hand.
5. Accrued expenses of Rs. 25,000 represent accrued salaries of Rs. 35,000 less non current advances of Rs. 10,000 made to company officials.
6. Loan payable represents a loan from bank that is payable in regular quarterly installments of Rs. 20,000. Interest of Rs. 2,000 accrued on the loan on December 31, 2000 has been recorded in those.
Financial Accounting
7. Tax liability not shown is estimated at Rs. 45,000.
8. Capital stock had been issued for a total consideration of Rs. 1,850,000 the amount received is in excess of par and stated values of the stock being reported as surplus. Capital stock represents 100,000 shares of Rs. 10 each.
Required:
By considering IAS (1) Presentation of Financial Statements, you are required to prepare corrected Balance Sheet with accounts properly classified.