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© All rights reserved Price : ` 945 Sixteenth Edition : September 2026 Published by : Taxmann Publications (P.) Ltd. Sales & Marketing : 59/32, New Rohtak Road, New Delhi-110 005 India Phone : +91-11-45562222 Website : www.taxmann.com E-mail : sales@taxmann.com Regd. Office : 21/35, West Punjabi Bagh, New Delhi-110 026 India Printed at : Tan Prints (India) Pvt. Ltd. 44 Km. Mile Stone, National Highway, Rohtak Road Village Rohad, Distt. Jhajjar (Haryana) India E-mail : sales@tanprints.com Disclaimer Every effort has been made to avoid errors or omissions in this publication. In spite of this, errors may creep in. Any mistake, error or discrepancy noted may be brought to our notice which shall be taken care of in the next edition. It is notified that neither the publisher nor the author or seller will be responsible for any damage or loss of action to any one, of any kind, in any manner, therefrom. No part of this book may be reproduced or copied in any form or by any means [graphic, electronic or mechanical, including photocopying, recording, taping, or information retrieval systems] or reproduced on any disc, tape, perforated media or other information storage device, etc., without the written permission of the publishers. Breach of this condition is liable for legal action. For binding mistake, misprints or for missing pages, etc., the publisher’s liability is limited to replacement within seven days of purchase by similar edition. All expenses in this connection are to be borne by the purchaser. All disputes are subject to Delhi jurisdiction only.
Contents PAGE
Chapter-wise Marks Distribution
I-5
Previous Exams Trend Analysis
I-7
Chapter-wise comparison with study material
I-9
Chapter 1
Introduction to Accounting Standards
1.1
Framework for Preparation & Presentation of Financial Statements
2.1
Chapter 3
Applicability of Accounting Standards
3.1
Chapter 4
Presentation & Disclosures Based Accounting Standards
4.1
Chapter 5
Asset Based Accounting Standards
5.1
Chapter 6
Liabilities Based Accounting Standards
6.1
Chapter 7
Accounting Standards Based on Items Impacting Financial Statements
7.1
Chapter 8
Revenue Based Accounting Standards
8.1
Chapter 9
Other Accounting Standards
9.1
I-11
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Chapter 2
I-12
CONTENTS PAGE
Chapter 10
Consolidated Financial Statements
10.1
Chapter 11
Financial Statement of Companies
11.1
Chapter 12
Buy-Back & Equity Shares with Differential Rights
12.1
Chapter 13
Amalgamation
13.1
Chapter 14
Internal Reconstruction
14.1
Chapter 15
Branch Accounting
15.1
Chapter 16 Multiple Choice Question Bank
16.1
Solved Paper: May 2026 (Suggested Answers)
P.1
Solved Paper: September 2026 (Suggested Answers)
P.36
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5 CHAPTER
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Keeping this in view: (i) Decide whether the inventory of empty bottles is an asset of the company; (ii) If so, whether the inventory of empty bottles existing as on the date of Balance Sheet is to be considered as inventories of the company and valued as per AS-2 or to be treated as scrap and shown at realizable value with corresponding credit to ‘Other Income’? [RTP May 2014] Ans. (i) What ‘Framework on Presentation and Preparation of Financial Statements’ states: Tangible objects or intangible rights carrying probable future benefits, owned by an enterprise are called assets. Analysis and conclusion: Alpha Ltd. sells these empty bottles by calling tenders. It means further benefits are accrued on its sale. Therefore, empty bottles are assets for the company. (ii) What AS-2 states: As per AS-2, inventories are assets held for sale in the ordinary course of business. Analysis and conclusion: Inventory of empty bottles existing on the Balance Sheet date is the inventory and Alpha Ltd. has detailed controlled recording and accounting procedure which duly signify its materiality. 5.1
TAXMANN®
Q.1 Alpha Ltd. sells beer to customers; some of the customers consume the beer in the bars run by Alpha Ltd. While leaving the bars, the consumers leave the empty bottles in the bars and the company takes possession of these empty bottles. The company has laid down a detailed internal record procedure for accounting for these empty bottles which are sold by the company by calling for tenders.
5.2
CH. 5: ASSET BASED ACCOUNTING STANDARDS
Thus, inventory of empty bottles cannot be considered as scrap and should be valued as inventory in accordance with AS-2.
6FRSH %DVHG RQ 3DUD 1RV DQG Q.2 A private limited company manufacturing fancy terry towels had valued its closing inventory of inventories of finished goods at the realisable value, inclusive of profit and the export cash incentives. Firm contracts had been received and goods were packed for export, but the ownership in these goods had not been transferred to the foreign buyers. Comment on the valuation of the inventories by the company. [RTP May 2018; RTP Jan. 2026]
TAXMANN®
Ans. What AS-2 states: Accounting Standard 2 states that inventories should be valued at lower of historical cost and net realizable value. The standard states, “at certain stages in specific industries, such as when agricultural crops have been harvested or mineral ores have been extracted, performance may be substantially complete prior to the execution of the transaction generating revenue. In such cases, when sale is assured under forward contract or a government guarantee or when market exists and there is a negligible risk of failure to sell, the goods are often valued at net realisable value at certain stages of production. ” Analysis and conclusion: Terry Towels do not fall in the category of agricultural crops or mineral ores. Accordingly, taking into account the facts stated, the closing inventory of finished goods (Fancy terry towel) should have been valued at lower of cost and net realisable value and not at net realisable value. Further, export incentives are recorded only in the year the export sale takes place. Therefore, the policy adopted by the company for valuing its closing inventory of inventories of finished goods is not correct.
&RVW %DVHG RQ 3DUD 1RV WR Q.3 “In determining the cost of inventories, it is appropriate to exclude certain costs and recognize them as expenses in the period in which they are incurred”. Provide examples of such costs as per AS-2 ‘Valuation of Inventories’. [Nov. 2012, 5 Marks; MTP Jan. 2026; Sept. 2024, 4 Marks, Similar] Ans. What AS-2 states: As per AS-2, certain costs are excluded from the cost of the inventories and are recognised as expenses in the period in which incurred. Examples of such costs are: (a) abnormal amount of wasted materials, labour, or other production costs;
CH. 5: ASSET BASED ACCOUNTING STANDARDS
5.3
(b) storage costs, unless those costs are necessary in the production process prior to a further production stage; (c) administrative overheads that do not contribute to bringing the inventories to their present location and condition; and (d) selling and distribution costs. Q.4 X Ltd., has a normal wastage of 4% in the production process. During the year 2016-17 the Company used 12,000 MT of raw material costing ` 150 per MT. At the end of the year 630 MT of wastage was in stock. The accountant wants to know how this wastage is to be treated in the books. Explain in the context of AS-2 the treatment of normal loss and abnormal loss and also find out the amount of abnormal loss if any. [Nov. 2014, 5 Marks; MTP Apr. 2018; MTP Oct. 2018; MTP Apr. 2019; MTP May 2020] Ans. What AS-2 states: As per AS-2, abnormal amounts of wasted materials, labour and other production costs are excluded from cost of inventories and such costs are recognised as expenses in the period in which they are incurred.
Amount of Abnormal Loss: Material used = 12,000 MT @ ` 150 = ` 18,00,000 Normal Loss = (4% of 12,000 MT) = 480 MT Net quantity of material = 11,520 MT Abnormal Loss in quantity = 150 MT Abnormal Loss = ` 23,437.50 [150 units @ ` 156.25 (` 18,00,000/11,520)] Thus, Amount ` 23,437.50 will be charged to the Profit and Loss statement. Q.5 In the following cases, find the value of closing stock as per AS-2: (i) Sonu is a retailer dealing in toys. During the year, he purchased items worth for ` 1,47,000 and made a total sale ` 1,54,000. The average percentage of gross margin is 10% on cost. Opening stock of toys at cost was ` 20,000. (ii) On 21st March 2023, Mohan purchased 250 chairs at ` 300 each. The selling price of the chair is ` 400 each. Owing to a manufacturing defect, net realisable value of the whole lot of chair was determined at 70% of their normal selling price. No chairs were sold during the year. [Nov. 2023, 5 Marks; MTP May 2026]
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Analysis and conclusion: The normal loss will be included in determining the cost of inventories (finished goods) at the year-end.
5.4
CH. 5: ASSET BASED ACCOUNTING STANDARDS
Ans. Valuation of Inventory – as per AS-2 Particulars
Amount 1,40,000
Toys Cost – 1,47,000 NRV – 1,54,000 – 1/11 of 1,54,000 = 1,40,000
70,000
Chairs Cost – 250 × 300 NRV – 250 × 280
Q.6 From the following information, ascertain the value of stock as on 31st March, 2012 `
Particulars Stock as on 01-04-2011
28,500
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Purchases
1,52,500
Manufacturing Expenses
30,000
Selling Expenses
12,100
Administration Expenses
6,000
Financial Expenses
4,300
Sales
2,49,000
At the time of valuing stock as on 31st March, 2011, a sum of ` 3,500 was written off on a particular item, which was originally purchased for ` 10,000 and was sold during the year for ` 9,000. Barring the transaction relating to this item, the gross profit earned during the year was 20% on sales. [Nov. 2012, 5 Marks] Ans. Statement showing valuation of stock as on 31-3-2012: Particulars
`
Stock as on 01-04-2011
28,500
Less: Book value of abnormal stock (` 10,000 – ` 3,500)
6,500
Add: Purchases
` 22,000 1,52,500
Manufacturing Expenses
30,000 2,04,500
Less: Cost of Sales Sales as per Books
2,49,000
Less: Sales of Abnormal item
(9,000) 2,40,000
Less: Gross Profit @ 20% Value of Stock as on 31st March, 2012
(48,000)
(1,92,000) 12,500
5.5
CH. 5: ASSET BASED ACCOUNTING STANDARDS
Q.7 Z Ltd. ordered 13,000 kg. of chemicals at ` 90 per kg. The purchase price includes excise duty of ` 5 per kg, in respect of which full CENVAT credit is admissible. Further, State VAT is leviable at ` 2.5 per kg on purchase price. Freight incurred amounted to ` 30,000. Normal transit loss is 4%. The company actually received 12,400 kg and consumed 10,000 kg. The company has received trade discount in the form of cash amounting to ` 1 per kg. The chemicals were delivered in containers. The containers were not reusable, hence sold for ` 500. The administrative expenses incurred to bring the chemicals were ` 10,000. Compute the value of inventory and allocate the material cost as per AS-2. [May 2016, 5 Marks] Ans. Computation of Cost of inventory: `
Particulars Purchase price (13,000 Kg. × ` 89 i.e. after Trade discount of ` 1)
11,57,000
Less: CENVAT Credit # (13,000 Kg. × ` 5)
(65,000) 10,92,000 30,000
Allocated Administrative expenses
10,000
Total material cost [X]
11,32,000
Number of units to be normally received = 96% of 13,000 Kg. [Y]
12,480
Normal cost per Kg. [X/Y]
90.705
# Now, called GST Input credit. Note: State VAT has been ignored considering it is recoverable later. Allocation of Material Cost Particulars
Kg.
Materials consumed
10,000
Cost of inventory (12,400 – 10,000)
2,400
Abnormal loss
80
`/Kg.
` 9,07,050
90.705
2,17,692 7,258 (Balancing Figure)
Total material cost
12,480
11,32,000
Note: Containers are used for delivery of the chemicals and are not reusable. Cost of these containers is treated as selling and distribution expense. The sale value of these containers will be credited to Profit and Loss Account and shall not be considered for the purpose of valuation of inventory. Alternatively, the sales value of container amount of ` 500 may be deducted, while computing material cost. In that case the material cost will be computed as ` 11,31,500 (11,32,000 – 500) instead of ` 11,32,000. Accordingly, the allocation of material cost will get changed.
TAXMANN®
Add: Freight
5.6
CH. 5: ASSET BASED ACCOUNTING STANDARDS
0HDVXUHPHQW RI ,QYHQWRULHV %DVHG RQ 3DUD 1RV DQG Q.8 A company had 5,000 units of stock “A”, costing @ ` 50 each on 313-2014. Out of this stock, 3,000 units are to be supplied under a firm contract at ` 45 each. Show how the valuation will be done of such stock when: (i) The general selling price is ` 49 each. (ii) The general selling price is ` 52 each.
[RTP Nov. 2014]
Ans. (i) Valuation of stock as on 31-3-2014 when general selling price is ` 49 each: Units
Cost
NRV
3000
50 50
45 49
2000
Lower of Cost and NRV 45 49
Valuation (Units × Cost/NRV) 1,35,000 98,000 2,33,000
TAXMANN®
Valuation of stock should be ` 2,33,000. (ii) Valuation of stock as on 31-3-2014 when general selling price is ` 52 each: Units
Cost
NRV
3000 2000
50 50
45 52
Lower of cost and NRV 45 50
Valuation (Units × Cost/NRV) 1,35,000 1,00,000 2,35,000
Valuation of stock should be ` 2,35,000. Q.9 On 31st March 2017, a business firm finds that cost of a partly finished unit on that date is ` 530. The unit can be finished in 2017-18 by an additional expenditure of ` 310. The finished unit can be sold for ` 750 (subject to payment of 4% brokerage on selling price). The firm seeks your advice regarding the amount at which the unfinished unit should be valued as at 31st March, 2017 for preparation of final accounts. Assume that the partly finished unit cannot be sold in semi-finished form and its NRV is zero without processing it further. [May 2013, 5 Marks; RTP May 2019] Ans. Valuation of Work in Process Particulars
`
Net selling price
750
Less: Estimated cost of completion
(310)
5.7
CH. 5: ASSET BASED ACCOUNTING STANDARDS
Particulars
` 440
Less: Brokerage (4% of 750)
(30)
Net Realisable Value
410
Cost of inventory
530
Value of inventory (Lower of cost and net realisable value)
410
Q.10 Mr. Mehul gives the following information relating to items forming part of inventory as on 31-3-2017. His factory produces Product X using Raw material A. (i) 600 units of Raw material A (purchased @ ` 120). Replacement cost of raw material A as on 31-3-2017 is ` 90 per unit. (ii) 500 units of partly finished goods in the process of producing X and cost incurred till date ` 260 per unit. These units can be finished next year by incurring additional cost of ` 60 per unit. (iii) 1500 units of finished Product X and total cost incurred ` 320 per unit. Expected selling price of Product X is ` 300 per unit.
[May 2015, 5 Marks; Jan. 2021, 5 Marks, Similar] Ans. What AS-2 states: As per AS-2, materials and other supplies held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at cost or above cost. However, when there has been a decline in the price of materials and it is estimated that the cost of the finished products will exceed net realisable value, the materials are written down to net realisable value. In such circumstances, the replacement cost of the materials may be the best available measure of their net realisable value. Analysis and conclusion: In the above case, selling price of product X is ` 300 and total cost per unit for production is ` 320. Valuation will be done as under: (i) 600 units of raw material will be written down to replacement cost as market value of finished product is less than its cost, hence valued at ` 90 per unit. (ii) 500 units of partly finished goods will be valued at 240 per unit i.e. lower of cost (` 260) or Net realisable value ` 240 (Estimated selling price ` 300 per unit less additional cost of ` 60). (iii) 1,500 units of finished product X will be valued at NRV of ` 300 per unit since it is lower than cost ` 320 of product X.
TAXMANN®
Determine how each item of inventory will be valued as on 31-3-2017. Also calculate the value of total inventory as on 31-3-2017.
5.8
CH. 5: ASSET BASED ACCOUNTING STANDARDS
Valuation of Total Inventory as on 31-3-2017: Particulars
Units
Cost
NRV/ Replacement Cost
Raw material A
600
120
90
54,000
Partly finished goods
500
260
240
1,20,000
1,500
320
300
4,50,000
Finished goods X
Value [Units × Cost or NRV whichever is less]
Value of Inventory
6,24,000
TAXMANN®
Q.11 Joy Ltd. purchased 20,000 kilograms of Raw Material @ ` 20 per kilogram during the year 2020-21. They have furnished you with the following further information for the year ended 31st March, 2021: Particulars Opening Inventory: Finished Goods Raw Materials Direct Labour Fixed Overheads Sales Closing Inventory: Finished Goods Raw Materials
Units 2,000 2,200
20,000
Amount (`) 1,00,000 44,000 3,06,000 3,00,000 11,20,000
2,400 1,800
The plant has a capacity to produce 30,000 Units of finished product per annum. However, the actual production of finished products during the year 2020-21 was 20,400 Units. Due to a fall in the market demand, the price of the finished goods in which the raw material has been utilize is expected to be sold @ ` 40 per unit. The replacement cost of the raw material was ` 19 per kilogram. You are required to ascertain the value of closing inventory as at 31st March, 2021 as per AS-2. [July 2021, 5 Marks] Ans. Statement Showing the Computation of Value of Closing Inventory: Value of Closing Finished Goods Particulars
Amount (`)
Cost of Raw Material consumed (20,400 units × ` 20 per kg) [2,200 units (Opening) + 20,000 units (Purchases) – 1,800 units (Closing) = 20,400 units]
4,08,000
Direct Labour
3,06,000
Fixed Overheads (3,00,000/30,000 × 20,400)
2,04,000
Cost of Production
9,18,000
Cost of Closing Inventory of Finished Goods per unit (` 9,18,000/20,400)
45
Net Realizable Value (NRV) per unit
40
5.9
CH. 5: ASSET BASED ACCOUNTING STANDARDS
Since net realizable value is less than cost, closing inventory of Finished Goods will be valued at ` 40 per unit. Value of Closing Raw Materials: As NRV of finished goods is less than its cost, the relevant raw material will be valued at its replacement cost, which is the best available measure of its NRV i.e. @ ` 19 per kg. Therefore, Value of closing inventory would be as under: Finished Goods 2,400 units @ ` 40/- per unit
` 96,000
Raw Materials 1,800 kg @ ` 19/- per kg
` 34,200 ` 1,30,200
Total
Q.12 Best Ltd. deals in five products P, Q, R, S and T which are neither similar nor interchangeable. At the time of closing of its accounts for the year ending 31st March 2011, the historical cost and net realizable value of the items of the closing stock are determined as follows: Net realizable value ` 4,75,000 10,32,000 2,89,000 4,25,000 2,15,000
What will be the value of closing stock for the year ending 31st March, 2011 as [May 2011, 5 Marks] per AS-2 “Valuation of Inventories”?
Ans. What AS-2 states: As per para 5 of AS-2 on ‘Valuation of Inventories’, inventories should be valued at the lower of cost and net realizable value. Inventories should be written down to net realizable value on an item-by-item basis. Analysis and conclusion: Valuation of inventory (Item wise): [for the year ending 31st March 2011] Item
Historical Cost
Net Realizable Value
Valuation of Closing Stock
P
` 5,70,000 9,80,000
` 4,75,000 10,32,000
` 4,75,000 9,80,000
3,16,000
2,89,000
2,89,000
4,25,000
4,25,000
4,25,000
1,60,000
2,15,000
1,60,000
Q R S T
23,29,000
The value of inventory for the year ending 31st March 2011 = ` 23,29,000.
TAXMANN®
Historical cost ` 5,70,000 9,80,000 3,16,000 4,25,000 1,60,000
Items P Q R S T
5.10
CH. 5: ASSET BASED ACCOUNTING STANDARDS
Q.13 Raw materials inventory of a company includes certain material purchased at ` 100 per kg. The price of the material is on decline and replacement cost of the inventory at the year-end is ` 75 per kg. It is possible to convert the material into finished product at conversion cost of ` 125. Decide whether to make the product or not to make the product, if selling price is (i) ` 175 and (ii) ` 225. Also find out the value of inventory in each case. [May 2010, 5 Marks] Ans. What AS-2 states: As per Para 24 of AS-2, materials and other supplies held for use in the production of inventories are not written down below cost if the finished products in which they will be incorporated are expected to be sold at or above cost. However, when there has been a decline in the price of materials and it is estimated that the cost of the finished products will exceed net realizable value, the materials are written down to net realizable value. In such circumstances, the replacement cost of the materials may be the best available measure of their net realizable value. TAXMANN®
Analysis and conclusion: (i) When selling price is `175: Current price of the material = ` 75 Therefore, Raw material inventory would be valued at net realisable value i.e. ` 75 because the selling price of the finished product is less than ` 225 (100 + 125) per kg. (ii) When selling price is ` 225: Current price of the raw material = ` 75. Therefore, Raw material inventory would be valued at ` 100 per kg because the selling price of the finished product is not less than ` 225. Q.14 Ltd. is a manufacturing company and engaged in the production of Finished goods ‘MP’ for which Raw material ‘RP’ is required. The company provides following information for the year ended March 31, 2025: Units
`
MP
4,000
1,20,000
RP
4,400
52,800
40,000
4,80,000
Particulars Opening Inventory Purchase of RP
5.11
CH. 5: ASSET BASED ACCOUNTING STANDARDS
Particulars
Units
`
Labour
3,23,200
Overheads (Fixed)
3,15,000
Sales
40,200
Closing Inventory
MP
4,200
RP
4,000
11,20,000
The expected production for the year was 45,000 units of the MP. Due to fall in market demand, the sales price for the MP was ` 22 per unit and the replacement cost for the RP was ` 11.50 per unit on the closing day. You are required to calculate the value of Closing Stock of ‘MP’ and ‘RP’ as on 31st March 2025. [Sept. 2025, 5 Marks; Similar Question in RTP May 2010] Ans. Computation of Cost for Closing Inventory Total (`)
Cost of Material Consumed (40,400 × 12)
12
4,84,800
Direct Labour
8
3,23,200
Fixed Overhead [3,15,000 × 404,00/45,000]
7
2,82,800
Cost of Production
27
10,90,800
Cost of closing inventory per unit (10,90,800/40,400)
` 27
Net Realisable Value per unit
` 22
Since net realisable value is less than cost, closing inventory will be valued at ` 22. As NRV of the MP (finished goods) is less than its cost, relevant raw materials will be valued at replacement cost i.e. ` 11.50. Therefore, value of closing inventory: MP (finished goods) (4,200 × 22) = ` 92,400 Raw Materials RP = (4,000 × 11.50) = ` 46,000 Therefore, Value of Closing Inventory Particulars
Amount
Finished Goods
` 92,400
Raw Materials
` 46,000 ` 1,38,400
TAXMANN®
Unit (`)
Particulars
Advanced Accounting (Advanced Accounts) | CRACKER AUTHOR : PUBLISHER : DATE OF PUBLICATION : EDITION : ISBN NO : No. of Pages : BINDING TYPE :
Parveen Sharma, Kapileshwar Bhalla CA Sunil Amlani Taxmann September 2026 16th Edition 9788167011862 876 Paperback
Rs. 945 DESCRIPTION Advanced Accounting | CRACKER is a question bank with full answers. It carries more than 600 questions across sixteen chapters. Each question sits in a grey box, and the answer comes straight after it. Theory answers follow the same shape every time. They state what the standard says, often quoting the exact paragraph, then close under a heading called “Analysis and Conclusion”, where the rule is applied to the facts. Practical answers show the full working, not just the final figure. Every computation statement, working note and journal entry is printed, along with the complete formats: Schedule III balance sheets, statements of profit and loss, notes to accounts, cash flow statements by both methods, realisation accounts, capital reduction accounts, branch stock and branch adjustment accounts, and consolidated balance sheets. Three things shape how the questions are arranged. • First, questions are grouped under grey heading bands that name the topic being tested. In the Accounting Standards chapters most bands also give the paragraph numbers, so you work through a standard in the order the standard itself is written • Second, the practical chapters use a difficulty ladder, starting with basic problems and moving up to advanced ones • Third, the consolidation chapter uses one fixed method for every problem: Analysis of Profit, Minority Interest, Cost of Control, Special Issues, then the consolidated balance sheet and its notes Every question also shows where it came from. An italic tag names the exam sessions it has appeared in and any ICAI Revision Test Paper or Mock Test Paper that carried it, and some add “Similar”, meaning the problem came back later in different words. The book ends with the May 2026 and September 2026 papers solved from start to finish, including the optional “or” question in each. The Present Publication is the 16th Edition, authored by CA. Parveen Sharma, CA. Kapileshwar Bhalla & CA. Sunil Amlani, with the following noteworthy features: • [Every Question Answered] More than 600 questions, each with its answer right below it • [Theory Answers Follow One Shape] Each opens with what the standard says, often quoting the paragraph, and closes with an “Analysis and Conclusion” applying the rule to the facts • [Full Working on Practical Answers] Computation statements, working notes and ruled tables throughout, so every figure traces back to its arithmetic • [Formats Drawn Out in Full] Journal entries, notes to accounts, Schedule III balance sheets, statements of profit and loss, cash flow statements by direct and indirect method, realisation accounts, capital reduction accounts, branch stock and branch adjustment accounts, and consolidated balance sheets • [Topic Headings Instead of a Plain List] Each grey band names the topic, method or difficulty level, so you know what a question tests before you start it • [Headings That Give Paragraph Numbers] For example “Changes in Accounting Policies (Based on Para Nos. 4 and 28 to 33)”. The assets chapter is the most closely divided in the book • [Problems Get Harder in Steps] Cash flow runs from theory, to classification of activities, to basic and then advanced problems under each method. Internal reconstruction, amalgamation and company final statements follow their own basic-to-advanced order • [One Fixed Method for Consolidation] Analysis of Profit, Minority Interest, Cost of Control, Special Issues, then the consolidated balance sheet and notes • [Source Tags on Every Question] Every exam session, RTP and MTP named, with repeats flagged “Similar” where the wording later changed • [Short Notes After Answers] These record an assumption, explain why an item was left out, settle a classification point, or point to a related question • [A Separate MCQ Chapter] Fifteen case scenarios and seventy-five two-mark MCQs, with the answer printed below the options • [Two Papers Solved Fully] May 2026 and September 2026, each with a Part I of case scenario MCQs and a Part II of written and practical questions, the optional “or” question included • [Three Tables at the Start] A chapter-wise marks table with averages, a trend table listing each question with its marks and theory or practical tag, and a map to the ICAI Study Material
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