You, as Auditor, are required to fix the `fair value’ of the shares of T Ltd., on 31st March, 2011. The company’s position was as follows:
Save your time - order a paper!
Get your paper written from scratch within the tight deadline. Our service is a reliable solution to all your troubles. Place an order on any task and we will take care of it. You won’t have to worry about the quality and deadlinesOrder Paper Now
Capital 5,000 shares of
Bldgs. at cost
Furniture at cost
at market value
Investment at Cost:
G.P. Notes for
Indian Gold Loan
Bad debts reserve
Profit and Loss:
Balance from 2009-10
Books debts consi-
Profit for 2010-11
(subject to tax of 40%)
Cash and bank balance
You are given the following information:
(1) The company’s prospects for 2012-12 are equally good.
(2) Its buildings are now worth Rs.3,50,000.
(3) Public companies doing similar business show a profit earning capacity of 15 per cent on market value of their shares.
(4) Profits for the past three years have shown an increase of Rs.50,000 annually.
(5) Investments yield 8% net on the book value on the whole.