1.1 Calculate the cost of capital in each of the following
ses:
A 7-year 100 bond of a firm can be sold for a net price
of 7 97.75 and is redeemable at a premium of 5%. The
coupon rate of interest is 10% and the tax rate is 32.5%.
) A company issues 10% Irredeemable Preference Shares
at 105 each (FV = 100).
iD The current market price of share is 90 and the expected
dividend at the end of current year is 4.50 with a growth
rate of 8%.
Answers
Answer:
48. The trial balance of a business as on 31st December, 2016 is given below:
337
IWB HS)
annum.
2500
333
Cr.
+
Dr.
₹
30,000 Reserve
5,000 Sundry creditors
6,900 Sales
6,700
Capital
20,300 Purchases returns
86,600 Discount received
16,800 Bills payable
10,000 Commission
25,000
400
700
560
29,340
670
400
630
Freehold premises
Salaries
Cash at bank
Wages
Stock (opening)
Purchases
Bills receivable
Furniture
Plant
Discount
Sales returns
Carriage outward
Sundry debtors -
Freight
Cash in hand
Carriage inward
16,000
20,500
1,40,000
30,000
1,000
4,000
7,500
21,000
5,305
-8, @ 20%
2,40,000
2,40,000
% on debt
[WB
count for
Prepare : (a) a Trading Account; (b) a Profit and Loss Account for the year ended 31st December, 2016;
and (c) a Balance Sheet as on that date after taking into account the following adjustments :
(1) Closing stock 30,000; (ii) Outstanding liabilities for : Salaries * 1,500, Wages * 1,000; (iii) Depreciate
plant @ 20% per annum and furniture @ 10% per annum; (iv) Sundry debtors include * 1,340 as bad ;
(u) Create a provision for bad debt @ 5% on the balance amount of sundry debtors.