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BRILLIANT’S Investment Accounting 283

Working Note:
`
10,000
1. Sale of rights : × 2 × ` 2 8,000
5
Less: Adjustment for fall in price (10,000 × 0.50) 5,000
Amount transferred to Statement of Profit and Loss 3,000
Important Note:
If in the above Illustration, the entire rights entitlement were sold for ` 3,000 (instead
of ` 8,000), the balance of the investment would be shown at ` 1,17,000 (` 1,20,000 - ` 3,000),
the income from sale of rights being adjusted against cost.

SOLVED PRACTICAL QUESTIONS

Illustration 3.3.8
On 1st April, 2017 Q Ltd. had ` 3,00,000 6% government stock at ` 94 (face value ` 100 each).
Interest is payable half-yearly on 31st March and 30th September. The company sold ` 90,000 of
the stock at ` 95 ex-interest on 1st June and purchased ` 72,000 stock at ` 97 cum-interest on 1st
September. A further purchase of ` 36,000 stock was made on 1st December at ` 98 ex-interest.
Draw up 6% Government Stock Account in the Investment Ledger of the company for the
year ended 31st March, 2018. Ignore brokerage and income tax.
The stock was quoted at ` 96 at the Stock Exchange on that date.
1 Aà¡b, 2017 H$mo Q {b{‘Q>oS> Ho$ < 94 (’o$g d¡ë¶y < 100 à˶oH$) na < 3,00,000 6% JdZ©‘|Q> ñQ>m°H$
Wm& ã¶mO 31 ‘mM© VWm 30 {gVå~a H$mo AY©dm{f©H$ ê$n go ^wJVmZ {H$¶m OmVm h¡& H§$nZr Zo 1 OyZ H$mo < 95 E³g-
B§Q>aoñQ> na < 90,000 H$m ñQ>m°H$ ~oMm VWm 1 {gV§~a H$mo < 97 H$‘-B§Q>aoñQ> na < 72,000 H$m ñQ>m°H$ IarXm& 1
{Xg§~a H$mo < 98 E³g-B§Q>aoñQ> na >< 36,000 ñQ>m°H$ H$s AmJo IarX H$s J¶r&
31 ‘mM© 2018 H$mo g‘má hþE df© Ho$ {bE H§$nZr Ho$ B§doñQ>‘|Q> boOa ‘| 6% JdZ©‘|Q> ñQ>m°H$ AH$mC§Q> {ZH$m{bE&
~«moH$aoO VWm B§H$‘ Q>¡³g H$s AdhobZm H$s{OE&
Cg {XZm§H$ H$mo ñQ>m°H$ E³gM|O ‘| ñQ>m°H$ < 96 na ñQ>m°H$ {H$¶m J¶m Wm&
Solution: In the Books of Q Ltd.
6% Government Stock Account
Dr. [Interest Payable: 31st March and 30th September] Cr.
Date Particulars Nominal Inte- Cost Date Particulars Nominal Inte- Cost
Value rest (`) Value rest (`)
1.4.17 To Bal b/d 3,00,000 - 2,82,000 1.6.17 By Bank A/c
1.6.17 To State. (WN 1) 90,000 900 85,500
P & L (WN1) - - 900 30.9.17 By Bank A/c
1.9.17 To Bank A/c (WN 3) - 8,460 -
(WN 2) 72,000 1,800 68,040 31.3.18 By Bank A/c