A Limited had acquired an item of Property, Plant and Equipment on 1 st April, 2022 for ₹ 48,000 lakhs. The following are the estimates of cash…
CA Intermediate · Advanced Accounting · MTP · September 2026
A Limited had acquired an item of Property, Plant and Equipment on 1 st April, 2022 for ₹ 48,000 lakhs. The following are the estimates of cash flows related to the said Property, Plant and Equipment on 31 st March, 2025: Year ended 31st March Cash Flows (₹ lakhs) 2026 5,000 2027 7,000 2028 7,000 2029 9,000 2030 5,000 The discount rate is 10%. The Property, Plant and Equipment has a useful life of 8 years and its residual value at the end of 31 st March, 2030 is ₹ 2000 lakhs. The Net Selling Price on 31 st March, 2025 is ₹ 27,000 lakhs. The Present Value of ₹1 discounted @ 10% at the end of Year 1 to Year 5 is given as under: Year 1 2 3 4 5 P.V. 0.909 0.826 0.751 0.683 0.621 A Limited has 5 business segments. The Profit/loss of each of the segments for the year ended 31 st March, 2025 is given below: Segment Profit/Loss (₹ lakhs) M 390 N 750 O (1,150) P (2,250) Q 3,000 Total 740 A Limited has also provided you with the following information as on 31 st March, 2025: Particulars Value Net Profit (after Tax) ₹ 15,60,000 No. of shares outstanding as on 31 st March, 2025 (Face Value ₹ 10/- each) 8,00,000 Weighted Average No. of shares outstanding as on 31 st March, 2025 (Face Value ₹ 10/- each) 6,50,000 Average fair value of one equity share during 2024-25 ₹ 25 Weighted Average No. of Shares under Option during 2024-25 80,000 Exercise price for Shares under Option during 2024-25 ₹ 20 30,000 6% Convertible Bonds of ₹100/- each (Each Bond is convertible into 4 Equity Shares) ₹ 30,00,000 Tax Rate 30% Based on the information given in the above case scenario, answer the following Question Nos. 1-4:
Suggested Answer and Working Notes:
Correct Answer: Option (C)
(iii) M, N and Q
Topics: AS 20, AS 10, AS 19
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