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286 Corporate Finance BRILLIANT’S

Working Notes:
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1. Purchase of Stock (cum-interest) on 1.3.2016
Nominal value 30,000
Total amount paid (300 × ` 95) 28,500

 5 2 
Less: Accrued Interest for 2 months 30,000   250

 100 12 
Cost 28,250
2. Sales of Stock (cum-interest) on 1.5.2016
Nominal Value 10,000
Sales Proceeds (100 × ` 97) 9,700

 5 4 
Less: Accrued Interest for 4 months 10,000   167

 100 12 
9,533
Profit on Sale of ` 10,000 Stock on 1.5.2016
Sales Proceeds 9,533

 ` 28,250 
Less: Average Cost   10,000  9,416
 30,000 
Profit on Sale 117
3. Sale of Stock (ex-interest) 15.12.2016
Nominal Value 10,000
Sales Proceeds (100 × ` 93) 9,300

 5 11 
Accrued Interest for 5½ months 10,000   229

 100 24 
4. Cost of Stock on 31.12.2016
 ` 28,250 
(i) Cost Price   10,000  9,416
 30,000 
(ii) Fair Value (100 × ` 92) 9,200
Value of Stock will be ` 9,200 (being lower than cost price)
5. Loss on Sale of ` 10,000 Stock on 15.12.2016
Sale Proceeds 9,300

 ` 28,250 
Less: Average Cost   10,000  9,416
 30,000 
Loss on Sale 116