Page 22 - 33. FR RTP NOV. 22

Year 2

To Retained Earnings 1,800 By Balance b/d 81,080
[(325 - 319) Emp x 24 By Employees Benefit
Options x Rs. 12.50] Expenses A/c 82,500
To Share Capital (319 Emp x By Bank A/c
24 Options x Rs. 100) 7,65,600 (319 Emp x 24 9,57,000
Options x Rs. 125)
To Securities Premium 2,87,100
(319 Emp x 24 Options x
Rs. 37.50)
To Balance c/d 66,080
11,20,580 11,20,580

Year 3
To Retained Earnings 672 By Balance b/d 66,080

[(297 - 295) Emp x 24 By Employees Benefit
Options x Rs. 14] Expenses A/c 33,712
To Share Capital By Bank A/c
(295 Emp x 24 Options 7,08,000 (295 Emp x 24 8,85,000
x Rs. 100) Options x Rs. 125)
To Securities Premium (295
Emp x 24 Options x Rs. 2,76,120
39)
9,84,792 9,84,792

Working Note:
Calculation of Securities Premium

Group I Group II Group III
Year 1 Year 2 Year 3
Exercise Price received per share 125.00 125.00 125.00
Value of service received per share, being the FV
of the Options 10.00 12.50 14.00
Total Consideration received per share 135.00 137.50 139.00
Less: Nominal Value per share (100.00) (100.00) (100.00)
Securities Premium per share 35.00 37.50 39.00

Solution 11
The following are the classification of various activities in the Statement of Cash Flows:

S. No. Particulars Classification for reporting cash flows
Banks / financial Other entities
institutions
1. Interest received on loans and advances Operating Activities Investing activities
given
2. Interest paid on deposits and other Operating Activities Financing activities
borrowings

33.21