Scenario:
A production business XYZ has the following assets and financial details:
- Initial Investment: ₹25 Crores
- Fixed Assets: ₹20 Crores
- Land & Building: ₹30 Crores
- Plant & Machinery: ₹35 Crores
- Subsidiary Investments: ₹10 Crores
- Debtors Outstanding (>365 days): ₹1 Crore
- Non-Government Securities: ₹2 Crores
- Pre-operative Expenses: ₹1 Crore
- P&L Account Debit Balance: ₹1 Crore
- Prepaid Expenses: ₹1 Crore
- Stock in Progress: ₹10 Crores
- Cash: ₹2 Crores
- Bills Receivables: ₹1 Crore
Questions:
What are the Fixed Assets of the Firm?
- A) ₹50 Crores
- B) ₹20 Crores
- C) ₹30 Crores
- D) ₹85 Crores
Answer: D) ₹85 Crores
Explanation: Fixed assets include Land & Building (₹30 Crores) and Plant & Machinery (₹35 Crores). Hence, total Fixed Assets = ₹20 Crores (Fixed) + ₹30 Crores (Land) + ₹35 Crores (Machinery).
What are the Non-Current Assets of the Firm?
- A) ₹1 Crore
- B) ₹2 Crores
- C) ₹10 Crores
- D) ₹13 Crores
Answer: D) ₹13 Crores
Explanation: Non-current assets include subsidiary investments (₹10 Crores), non-government securities (₹2 Crores), and pre-operative expenses (₹1 Crore).
What are the Intangible Assets of the Firm?
- A) ₹1 Crore
- B) ₹2 Crores
- C) ₹3 Crores
- D) ₹4 Crores
Answer: A) ₹1 Crore
Explanation: Pre-operative expenses of ₹1 Crore are considered intangible assets.
What are the Current Assets of the Firm?
- A) ₹10 Crores
- B) ₹11 Crores
- C) ₹12 Crores
- D) ₹14 Crores
Answer: D) ₹14 Crores
Explanation: Current assets include stock in progress (₹10 Crores), cash (₹2 Crores), and bills receivable (₹1 Crore).
What is the total value of the firm’s assets?
- A) ₹100 Crores
- B) ₹114 Crores
- C) ₹120 Crores
- D) ₹140 Crores
Answer: B) ₹114 Crores
Explanation: Total assets are the sum of fixed assets, intangible assets, current assets, etc.