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Practice Test Papers PTP.7
Practice Test Paper 4

1. Sunlight Ltd. received insurance claim of ` 10,00,000 for the loss of building and machinery
due to floods. Under which activity and how will this payment be shown in the Cash Flow
Statement? (1)
2. Evergreen Securities Ltd., a company dealing in shares and other financial instruments
received dividend from various companies amounting to ` 5,00,000. Under which activity
dividend received will be shown in Cash Flow Statement? (1)
3. Under which main-head and sub-head of the Balance Sheet will be the following items
be shown?
(i) Employees Stock Option Account
(ii) Deferred Tax Liabilities
(iii) Bank Overdraft or Cash Credit
(iv) Investment in Shares (4)
4. (a) Total Equity and Liabilities are ` 50,00,000; Shareholders’ Funds ` 20,00,000 and Current
Liabilities ` 10,00,000. Calculate Debt to Equity Ratio. (2)
(b) During the year ending 31st March, 2024, Ajmera Ltd., a Jewellery manufacturer, sold
goods costing ` 4 crores. Its average of Opening and Closing Inventory was ` 40 lakh.
Calculate Company’s Inventory Turnover Ratio. The industry’s bench mark is 5 times.
Also, comment on the efficiency of company. (2)
5. C&C Ltd. is in the business of manufacturing ingots, implemented health programme
in its factory. Under the programme every employee was to undergo medical tests
every month, get healthy food at subsidised costs. Besides this, a gym was set up
with all exercise equipment for the staff. The staff was to be educated regularly about
the benefits of good health. Its Comparative Balance Sheet as at 31st March, 2023 and
2024 was as follows:

Particulars Note 31st March, 31st March, Absolute Change Percentage Change
No. 2023 2024 (Increase/Decrease) (Increase/Decrease)
` ` ` %
I. EQUITY AND LIABILITIES
1. Shareholders’ Funds
(a) Share Capital 15,00,000 20,00,000 5,00,000 33.33
(b) Reserves and Surplus 4,00,000 5,00,000 1,00,000 25.00
2. Non-Current Liabilities
Long-term Borrowings 27,00,000 25,00,000 (2,00,000) (7.41)
3. Current Liabilities
(a) Short-term Borrowings 3,00,000 4,00,000 1,00,000 33.33
(b) Trade Payables 80,000 1,00,000 20,000 25.00
Total 49,80,000 55,00,000 5,20,000 10.44