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Problem Relating to Managerial Remuneration

Following particulars are available from the books of Royal Ltd. :
Net profit before provision for income-tax and managerial remuneration, but after depreciation and - provision for repairs 98,04,000
Depreciation provided in the books 35,00,000
Provision for repairs of machinery during the year 2,50,000
Depreciation allowable under Schedule XIV of the Companies Act, 1956 30,00,000
Actual expenditure incurred on repairs during the year 1,60,000
You are required to calculate the managerial remuneration in the following cases:
(i)If there is one whole-time director; and
(ii)If there are two whole-time directors, a part-time director and a manager.
" India Accounting
1/13/2012 0:56:08 Resmi uresmi@gmail.com Redemption "Liabilities Rs Assets RS
10,000 Equity Share of Rs.10 each fully paid 100000 Fixed Assets 262000
Debtors 90,000
11% Preference Shares of Rs.100 each 1,00,000 Stock 30,000
Investments 30,000
Less: Calls-in-arrear @ Rs.20 per share 6000 Bank 4,000
10% Preference Shares of
Rs.10 each fully paid 100000
General Reserve 40,000
Profit & Loss Account 20,000
Securities Premium Account 5,000
Capital Reserve 30,000
Creditors 27,000
416000 416000

11% preference shares were due for payment on 1st April, 2008 at a
premium of 10%. The company sent the reminders for the final call on
the remaining 300-11% preference shares and could collect money from
shareholders holding 200 shares @ Rs.20 per share and forfeited the
defaulting 100 shares. The company sold all investments at 90% of the
cost of such investments. The Company issued adequate number of new
equity shares at par, to the extent that available profits were insufficient
to back-up the redemption
Resmi  from India


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