There are two statements marked as Assertion (A) and Reason (R). Mark your answer as per the options given below.
Assertion (A): Two broad heads under which the Balance Sheet is prepared are Equity & Liabilities and Assets.
Reason (R): Part I of Schedule III of the Companies Act, 2013 prescribes to show Equity & Liabilities in the first part followed by Assets in the second part.
Answer & explanation
Correct answer: option 1
I. EQUITY AND LIABILITIES
1) Shareholder’s Funds (a) Share Capital (b) Reserves and Surplus (c) Money received against share warrants
2) Share Application money pending allotment
3) Non-current Liabilities (a) Long term borrowings (b) Deferred tax liabilities (net) (c) Other long term liabilities (d) Long term provisions
4) Current Liabilities (a) Short-term borrowings (b) Trade payables (c) Other current liabilities (d) Short-term provisions
II. ASSETS
1) Non-Current Assets (a) Fixed assets (i) Tangible assets (ii) Intangible assets (iii) Capital work-in-progress (iv) Intangible assets under development (b) Non-current investments (c) Deferred tax assets (net) (d) Long-term loans and advances (e) Other non-current assets
2) Current Assets (a) Current investments (b) Inventories (c) Trade receivables (d) Cash and cash equivalents (e) Short term loans and advances (f) Other current assets