Answers of both the parts of questions. Q1 (i). Two sisters formed a corporation on 1 January 2008, each of them investing Rs. 10,000and receiving 1,000 shares of the corporation's capital. The corporation issued no more sharesof capital during the next three years. On 1 January 2011, the company had total assets of Rs.1,20,000 and total liabilities of Rs. 64,000.a friend of theDuring 2011, the corporation issued 100 additional shares of its capital stocktwo sisters, receiving in exchange Rs. 6,000 in cash. Cash dividends (profit distribution to allthe owners i.e. both sisters and one friend) amounting to Rs. 24,000 were declared and paidduring the year. On 31 December 2011, the company had assets amounting to Rs. 1,40,000and liabilities of Rs. 68,000.Questions (a). Calculate the net income for 2011.Question (b). Present the owner's equity section (capital) of the company's balancesheet on 31 December 2011.

Net income is the difference between total revenues generated and total expense incurred during the…

Q1 (i).Two sisters formed a corporation on 1 January 2008, each of them investing Rs. 10,000 and receiving 1,000 shares of the corporation's capital. The corporation issued no more shares of capital during the next three years. On 1 January 2011, the company had total assets of Rs. 1,20,000 and total liabilities of Rs. 64,000. During 2011, the corporation issued 100 additional shares of its capital stock to a friend of the two sisters, receiving in exchange Rs. 6,000 in cash. Cash dividends (profit distribution to all the owners i.e. both sisters and one friend) amounting to Rs. 24,000 were declared and paid during the year. On 31 December 2011, the company had assets amounting to Rs. 1,40,000 and liabilities of Rs. 68,000. Questions (a). Calculate the net income for 2011. Question (b). Present the owner's equity section (capital) of the company's balance sheet on 31 December 2011.

Q1 (i).Two sisters formed a corporation on 1 January 2008, each of them investing Rs. 10,000 and receiving 1,000 shares of the corporation's capital. The corporation issued no more shares of capital during the next three years. On 1 January 2011, the company had total assets of Rs. 1,20,000 and total liabilities of Rs. 64,000. During 2011, the corporation issued 100 additional shares of its capital stock to a friend of the two sisters, receiving in exchange Rs. 6,000 in cash. Cash dividends (profit distribution to all the owners i.e. both sisters and one friend) amounting to Rs. 24,000 were declared and paid during the year. On 31 December 2011, the company had assets amounting to Rs. 1,40,000 and liabilities of Rs. 68,000. Questions (a). Calculate the net income for 2011. Question (b). Present the owner's equity section (capital) of the company's balance sheet on 31 December 2011.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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