Q.1.From the following trial balance of Sh. parveen kumar prepare trading and profit & loss account for the year ending 31st march , 1999 and a balance sheet as on that date :
Dr . balance Rs Cr. balance Rs
Stock at commencement 40,000 sales 5,10,000
purchases 3,20,000loan from Mr. naresh @ 15% p.a. 40,000
Returns inwaed 7,000 Returns outwards 8,000
Sundry debtors80,000 bank 24,200
cash 9,400 provision for doubtful debts 2,500
manufacturing expenses 44,000 discount 1,800
trade expenses 7,200 rent of premises sublet, for the year to
30th sept ., 1999 4,000
carriage 3,500 captial1,20,000
salaries and wages 15,800 sundry creditors 47,000
postage and telegrams 1,500
stationery 800
freight inwards4,300
land and building 2,00,000
patents 8,000
furniture 10,000
insurance premium 6,000
Informations :-
(1) closing stock was valued at Rs. 60,000 . you are informed that goods valued Rs. 12,000 were sold and despatched on 29th march , 1999 , but na entry was passed to this effect .
(2) insurance premium include Rs .1,200 paid on 1st october , 1998 to run for one year from oct .1,1998 to sept ., 30,1999 .
(3) Loan from Mr. naresh was taken on 1st july , 1998 . interest has not been paid so far .
(4) create provision for doubtful debts at 15% on sundry dedtors after writing off Rs. 600 as bad - debts during the year .
(5) a bill of Rs 3,200 for advertisment in newspapers remained unpaid at the end of the year .
(6) purchases include furniture costing Rs 5,000 purchased on 1st april , 1998 . 1/2 (7) charge 10% p.a. depreciation on furniture and write off 1/5 th of patents .
Trading Account for the year ended March 31, 1999 | ||||||
Dr. |
|
|
| Cr. | ||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | |||
Opening Stock | 40,000 | Sales | 5,10,000 |
| ||
Purchases | 3,20,000 |
| Less: Return Inwards | (7,000) | 5,03,000 | |
Less: Return Outwards | (8,000) |
| Closing Stock (60,000 – 12,000**) | 48,000 | ||
Less: Furniture | (5,000) | 3,07,000 |
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Freight Inwards | 4,300 |
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Manufacturing Expenses | 44,000 |
|
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Gross Profit | 1,55,700 |
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|
|
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| 5,51,000 |
| 5,51,000 | |||
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|
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Profit and Loss Account for the year ended March 31, 1999 | |||||||
Dr. |
|
|
| Cr. | |||
Particulars | Amount (Rs) | Particulars | Amount (Rs) | ||||
Depreciation on Furniture | 1,500 | Gross Profit | 1,55,700 | ||||
Salaries and Wages | 15,800 | Discount Received | 1,800 | ||||
Carriage | 3,500 | Rent of Premises- Sublet | 4,000 |
| |||
Postage and Telegrams | 1,500 | Less: Received in Advance | (2,000) | 2,000 | |||
Stationery | 800 |
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| ||||
Interest on Loan (40,000 × 15% × 9/12) | 4,500 |
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Bad Debts | 600 |
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Add: New Provision | 11,910 |
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Less: Old Provision | (2,500) | 10,010 |
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Advertisement Expenses | 3,200 |
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Patents Written-off | 1,600 |
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Trade Expenses | 7,200 |
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Insurance Charges | 6,000 |
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|
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Less: Prepaid Insurance | (600) | 5,400 |
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Net Profit | 1,04,490 |
|
| ||||
| 1,59,500 |
| 1,59,500 | ||||
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Balance Sheet as on March 31, 1999 | |||||
Liabilities | Amount (Rs) | Assets | Amount (Rs) | ||
Capital | 1,20,000 |
| Fixed Assets |
| |
Add: Net Profit | 1,04,490 | 2,24,490 | Patents (8,000 – 1,600) | 6,400 | |
Loan from Mr Naresh @ 15% | 40,000 |
| Land and Building | 2,00,000 | |
Add: Interest Outstanding | 4,500 | 44,500 | Furniture | 10,000 |
|
Current Liabilities |
| Add: Purchased | 5,000 |
| |
Bank Overdraft | 24,200 | Less: Depreciation @10% | (1,500) | 13,500 | |
Sundry Creditors | 47,000 | Current Assets |
| ||
Advertisement Expense Outstanding | 3,200 | Closing Stock | 48,000 | ||
Rent received in Advance | 2,000 | Debtors | 80,000 |
| |
|
| Less: Bad-Debts | (600) |
| |
|
|
| 79,400 |
| |
|
| Less: Provision for Doubtful debt @ 15% | (11,910) | 67,490 | |
|
| Cash in Hand | 9,400 | ||
|
| Prepaid Insurance | 600 | ||
| 3,45,390 |
| 3,45,390 | ||
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** Rs 12,000 represents Goods-in-Transit. It is not recognized as Sales since such goods are not yet delivered to the Customers. Therefore they are simply deducted from Closing Stock.