Question

Prepare Trading and Profit and Loss Account and Balance Sheet from
the following Trial Balance and information as on 31st March, 2019:
Debit Credit
Name of Account
(₹) (₹)
Drawings and Capital 15,000 3,25,000
Plant and Machinery 2,00,000 –
Motor Vehicle 1,50,000 –
Return Inward and Outward 25,000 37,000
Stock on 1st April, 2018 82,000 –
Purchases and Sales 4,40,000 6,75,000
Carriage Inward 6,000 –
Trade Expenses 2,500 –
Bad Debts 4,250 –
Provision for Doubtful Debts – 6,000
Commission – 4,000
Rent, Rates & Taxes 12,000 –
Salaries and Wages 24,000 –
Debtors and Creditors 70,000 55,000
Fuel and Water 4,750 –
Cash in Hand 16,500 –
Cash at Bank 50,000 –
Total 11,02,00 11,02,00
0 0

Adjustments:
(i) Closing Stock was valued at ₹ 1,12,500.
(ii) Commission include ₹ 1,200 being commission received in advance.
(iii) Salaries and wages is outstanding for the month of Feb. & March,
2019.
(iv) Depreciate Plant & Machinery by 15% and Motor Vehicle by 20%.
(v) Write off ₹ 500 as further Bad Debts and maintain provision for
doubtful debts at 1% on debtors.

Solution
Trading Account
for the year ended March 31, 2019
Dr Cr
. .
Amount ( Amount (
Particulars Particulars
₹) ₹)
6,75,0
Opening Stock 82,000 Sales
00
Purchases 4,40,0
Less: Return Inwards 25,000 6,50,000
00
Less: Return Outwards 37,000 4,03,000 Closing Stock 1,12,500
Carriage Inward 6,000
Fuel and Water 4,750
Gross Profit (Balancing Figure) 2,66,750
7,62,500 7,62,500
Profit and Loss Account
for the year ended March 31, 2019
Dr. Cr.
Amount (₹
Particulars Particulars Amount (₹)
)
Depreciation: Gross Profit 2,66,750
Plant & Machinery 30,000 Commission 4,000
Motor Vehicle 30,000 60,000 Less: Unearned 1,200 2,800
Salaries & Wages 24,000 Provision for Doubtful Debts
Add: Outstanding 4,800 28,800 (Old Provision - New
5,305
Provision)
Old Bad Debts 4,250
Add: Further Bad 500 4,750
Debts
Trade Expenses 2,500
Rent, Rates and Taxes 12,000
Net Profit (Balancing Figure) 1,66,805
2,74,855 2,74,855
Balance Sheet
as on March 31, 2019
Amount (₹ Amount (₹
Liabilities Assets
) )
Capital 3,25,000 Fixed Assets
Add : Net Profit 1,66,805 Plant & Machinery 2,00,000
Less: Drawings 15,000 4,76,805 Less: Dep. 30,000 1,70,000
Motor Vehicle 1,50,000
Less: Dep. 30,000 1,20,000
Current Liabilities Current Assets
Creditors 55,000 Closing Stock 1,12,500
Outstanding Salaries and Wages 4,800 Debtors 70,000
Unearned Commission 1,200 Less: Bad Debts 500
Less: Provision for Bad
695 68,805
Debts
 Cash in Hand 16,500
Cash at Bank 50,000
5,37,805 5,37,805

Working Note:

WN1: Calculation of Amount of Depreciation

DepreciationonMachinery=2,00,000×15100=Rs30,000Depreciationo
nMotorVehicle=1,50,000×20100=Rs30,000

WN2: Calculation of Provision for Doubtful Debts

ProvisionforDoubtfulDebts=(SundryDebtors-
FurtherBadDebts)×Rate100=(70,000−500)×1100=Rs695

WN3: Calculation of Outstanding Salaries and Wages

Salaries and Wages paid for 10 months = 24,000Salaries and Wages

outstanding for 2 months =24,000 ×210= Rs 4,800

Suggest Corrections

57
SIMILAR QUESTIONS

Q. Prepare Trading and Profit and Loss Account and Balance Sheet from the following Trial
Balance and information as on 31st March, 2013:

Debit Credit
Name of Account
(₹) (₹)
Drawings and Capital 15,000 3,25,000
Plant and Machinery 2,00,000 –
Motor Vehicle 1,50,000 –
Return Inward and Outward 25,000 37,000
Stock on 1st April, 2012 82,000 –
Purchases and Sales 4,40,000 6,75,000
Carriage Inward 6,000 –
Trade Expenses 2,500 –
Bad Debts 4,250 –
Provision for Doubtful Debts – 6,000
Commission – 4,000
Rent, Rates & Taxes 12,000 –
Salaries and Wages 24,000 –
Debtors and Creditors 70,000 55,000
Fuel and Water 4,750 –
Cash in Hand 16,500 –
Cash at Bank 50,000 –
Total 11,02,00 11,02,00
0 0

Adjustments:-
(i) Closing Stock was valued at ₹ 1,12,500.
(ii) Commission include ₹ 1,200 being commission received in advance.
(iii) Salaries and wages is outstanding for the month of Feb. & March, 2013.
(iv) Depreciate Plant & Machinery by 15% and Motor Vehicle by 20%.
(v) Write off ₹ 500 as further Bad Debts and maintain provision for doubtful debts at 1% on
debtors.

Q. From the following figures prepare the Trading and Profit and Loss Account for the year
ended 31st March, 2019 and the Balance Sheet as at that date:-

Particulars (₹) Particulars (₹)

Stock (1st April, 2018) 75,000 Sundry Debtors 82,000
Purchases 8,00,000 Loan from X 10,000
 Sales 12,00,000 Interest on X Loan 1,500
Motor Car 1,50,000 Furniture 20,000
Car Expenses 42,000 Land and Building 2,00,000
Rent 5,500 Capital 2,50,000
Salaries 35,200 Sundry Creditors 91,300
Bad Debts 1,500 Returns Inward 7,500
Provision for bad debts 8,100 Returns Outward 6,000
Commission (Cr.) 4,600 Cash in hand 16,400
Wages 1,25,000
Insurance 8,400

Adjustments:-
(i) Commission include ₹ 1,600 being commission received in advance.
(ii) Write off ₹ 2,000 as further Bad-debts and maintain Bad-debts provision at 5% on
debtors.
(iii) Expenses paid in advance are: Wages ₹ 5,000 and Insurance ₹ 1,200.
(iv) Rent and Salaries have been paid for 11 months.
(v) Loan from X has been taken at 18% p.a. interest.
(vi) Depreciate furniture by 15% p.a. and Motor Car by 20% p.a.
(vii) Closing Stock was valued at ₹ 60,000.

Q. From the following Trial Balance of Shradha as on 31st March, 2019, prepare Trading and
Profit and Loss Account and Balance Sheet:

Debit
Credit Balances
Heads of Accounts Balances
(₹)
(₹)
Capital … 80,000
Drawings 18,000 …
Sales … 1,55,000
Purchases 82,600 …
Stock (1st April, 2018) 42,000 …
Returns Outward … 1,600
Carriage Inwards 1,200 …
Wages 4,000 …
Power 6,000 …
Machinery 50,000 …
Furniture 14,000 …
Rent 22,000 …
Salary 15,000 …
Insurance 3,600 …
8% Bank Loan … 25,000
 Debtors 20,600 …
Creditors … 18,900
Cash in Hand 1,500 …
Total 2,80,500 2,80,500

Adjustments:
(i) Closing Stock ₹ 64,000.
(ii) Wages outstanding ₹ 2,400.
(iii) Bad Debts ₹ 600.
(iv) Provision for Doubtful Debts to be 5%.
(v) Rent is paid for 11 months.
(vi) Insurance premium is paid per annum, ended 31st May, 2019.
(vii) Loan from the bank was taken on 1st October, 2018.
(viii) Provide Depreciation on machinery @ 10% and on Furniture @ 5%.

Q. The Trial Balance shows the following balances as at 31st March, 2017:-

Dr. Balances (₹) Cr. Balances (₹)

Purchases 60,000 Capital 1,13,075
Sales Returns 1,500 Sales 1,27,000
Plant and Machinery 90,000 Purchases Returns 1,275
Opening Stock 40,000 Discount Received 800
Discount Allowed 350 Sundry Creditors 20,000
Bank Charges 100 Bills Payable 5,000
Sundry Debtors 45,000
Salaries 7,000
Wages 10,000
Freight : In 1,000
Freight : Out 1,200
Rent, Rates and Taxes 2,000
Advertisements 2,000
Cash at Bank 7,000
2,67,150 2,67,150

Closing Stock was valued at ₹ 35,000. Prepare Trading and Profit and Loss Account for the
year ended 31st March, 2017 and Balance Sheet as at that date.

Q.
From the following trial balance of Varshney and Sons, prepare trading account and profit
and loss account for the year ending 31st December, 2016 and a balance sheet as on that
date.
ParticularsAmt. (Rs.)ParticularsAmt. (Rs.)Opening Stock 10,400Capital
32,000Purchases 31,000Creditors 4,000Sales Return 600Sales 40,000Debtors
8,000Commission 5,480Building 10,000Rent 4,000Machinery 7,200Furniture
3,200Bills Receivable 4,000Salaries 3,200Tax 400Insurance 600Carriage
on Purchases 1,800Trade Expenses 600Travelling Expenses 880Wages
2,000Cash 1,600 ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯85,480–––––––– ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯85,480––––––––

Adjustments:

(i) Closing stock Rs. 24,000

(ii) Rent due but not received Rs. 200.

(iii) Commission to the extent of Rs. 280 received in advance.

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Question

Prepare a Trading and Profit and Loss account for year ending
December 31, 2010 from the balances extracted to M/s Rahul Sons.
Also prepare a balance sheet at the end of the year.
Account Title Amt. (Rs.) Account Title Amt. (Rs.)
Stock 50,000 Sales 1,80,000
Wages 3,000 Purchase Return 2,000
Salary 8,000 Discount Received 500
Purchase 1,75,000 Provision for Bad Debts 2,500
Sales Return 3,000 Capital 3,00,000
Sundry Debtors 82,000 Bills Payable 22,000
Discount Allowed 1,000 Commission Received 4,000
Insurance 3,200 Rent 6,000
Rent, Rates and Taxes 4,300 Loan 34,800
Fixtures and Fittings 20,000
Trade Expenses 1,500
Bad Debts 2,000
Drawings 32,000
Repair and Renewals 1,600
Travelling Expenses 4,200
Postage 300
Telegram Expenses 200
Legal Fees 500
Bills Receivable 50,000
Building 1,10,000
5,51,800 5,51,800
Adjustments
1. Commission received in advance Rs. 1,000.
2. Rent received Rs. 22,000.
3. Salary outstanding Rs. 1,000 and insurance prepaid Rs. 800.
4. Further bad debts Rs. 1,000 and provision for bad debts @ 5% on
debtors and discount on debtors @ 2%.
5. Closing stock Rs. 32,000.
6. Depreciation on building @ 6% pa.

Solution

Trading and Profit and Loss Account

as on 31st December, 2010
Dr Cr
Particulars Amt. (Rs.) Particulars Amt.(Rs.)
To Opening Stock 50,000 By Sales 1,80,000
3,000
To purchase 1,75,000 (-) Sales Return
1,77,000
(-) Purchase By Closing Stock 32,000
2,000
Return By Gross Loss c/d 17,000
1,73,000
3,000
To Wages 2,26,000
2,26,000
To Gross Loss b/d 17,000 By Discount Received 500
To Salary 8,000 By Commission 4,000
1,000
(+) Outstanding (-) Advance
3,000
1,000
Salary By Rent 6,000
9,000
2,000
To Discount Allowed 1,000 (+) Accrued Rent
8,000
To Insurance 3,200 By Net Loss 43,189
(-) Prepaid
800
Insurance
2,400
To Rent, Rates and Taxes 4,300
To Trade Expenses 1,500
To Bad Debts 2,000
(+) Further Bad
Debts 1,000
(+) New Provision 4,050
(+) Discount 1,539
2,500
(-) Old Provision
6,089
To Postage 300
To Telegram Expenses 200
To Repair and Renewals 1,600
To Travelling Expenses 4,200
To Legal Fees 500
To Depreciation on Building 6,600
54,689 54,689

Balance Sheet
as on 31st December, 2010
Liabilities Amt. (Rs.) Assets Amt. (Rs.)
Capital 3,00,000 Sundry Debtors 82,000
43,189 (-) Further Bad
(-) Net Loss 1000
2,56,811 Debts
32,000
(-) Drawings (-) New Provision 4,050
2,24,811
1,539
Bills Payable 22,000 (-) Discount
75,411
Loan 34,800 Bills Receivable 50,000
Advance Commission 1,000 Fixtures and Fitting 20,000
800
Prepaid Insurance
1,10,000
Building
6,600
Outstanding Salary 1,000 (-) Depreciation @ 6%
1,03,4000
Rent (Accrued)
2,000
Closing Stock
32,000
2,83,611 2,83,611

Working Note
Sundry Debtors 82,000
(-) Further Bad Debts 1,000
81,000
(-) Provision(5%) 4,050
76,950
(-) Discount (2%) 1,539
Rs. 75,411

Suggest Corrections

SIMILAR QUESTIONS

Q. The following balances has been extracted from the trial of M/s Runway Shine Ltd.
Prepare a trading and profit and loss account and a balance sheet as on December 31,
2010.

Account Title Amt. (Rs.) Account Title Amt. (Rs.)

Purchase 1,50,000 Sales 2,50,000
Opening Stock 50,000 Return Outwards 4,500
Return Inwards 2,000 Interest Received 3,500
Carriage Inwards 4,500 Discount Received 400
Cash in Hand 77,800 Creditors 1,25,000
Cash in Bank 60,800 Bills Payable 6,040
Wages 2,400 Capital 1,00,000
Printing and Stationery 4,500
Discount 400
Bad Debts 1,500
Insurance 2,500
Investment 32,000
Debtors 53,000
Bills Receivable 20,000
Postage and Telegraph 400
Commission 200
Interest 1,000
Repair 440
Lighting Charges 500
Telephone Charges 100
Carriage Outward 400
Motor Car 25,000
4,89,440 4,89,440
Adjustments
1. Further bad debts Rs. 1,000. Discount on debtors Rs. 500 and make a provision on
debtors @ 5%.
2. Interest received on investment @ 5%.
3. Wages and interest outstanding Rs. 100 and Rs. 200 respectively.
4. Depreciation charged on motor car @ 5% pa. 5. Closing stock Rs. 32,500.

Q.
Prepare a Trading and Profit and loss account for year ending December 31, 2010 from the
balances extracted to M/s Rahul Sons. Also prepare a balance sheet at the end of the year.

Account TitleAmt. (Rs.)Account TitleAmt.(Rs)Opening Stock

50,000Sales1,80,000Wages 3,000Purchase Return 2,000Salary 8,000Discount
Received 500Purchase1,75,000Provision for Bad Debts 2,500Sales Return
3,000Capital3,00,000Sundry Debtors 82,000Bills Payable 22,000Discount Allowed
1,000Commission Received 4,000Insurance 3,200Rent 6,000Rent, Rates and
Taxes 4,300Loan 34,800Fixtures and Fittings 20,000Trade Expenses
1,500Bad Debts 2,000Drawings 32,000Repair and Renewals 1,600Travelling
Expenses 4,200Postage 300Telegram Expenses 200Legal Fees
500Bills Receivable 50,000Building1,10,000 ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯5,51,800––––––––––––––––––––
¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯5,51,800––––––––––––––––––––

Adjustments:

1. Commission received in advance Rs. 1,000.

2. Rent received Rs. 2,000.

3. Salary outstanding Rs. 1,000 and insurance prepaid Rs. 800.

4. Further bad debts Rs. 1,000 and provision for bad debts @5% on debtors and discount on
debtors @ 2%.

5. Closing stock Rs. 32,000.

6. Depreciation on building @ 6% pa.

Q. Prepare the trading and profit and loss account and balance sheet of M/s Shine Ltd from
the following particulars.

Account Title Amt.(Rs) Account Title Amt. (Rs)

Sundry Debtors 1,00,000 Bills Payable 85,550
Bad Debts 3,000 Sundry Creditors 25,000
Trade Expenses 2,500 Provisions for Bad Debts 1,500
Printing and Stationery 5,000 Return Outwards 4,500
Rent, Rates and Taxes 3,450 Capital 2,50,000
Freight 2,250 Discount Received 3,500
Sales Return 6,000 Interest Received 11,260
Motor Car 25,000 Sales 1,00,000
Opening Stock 75,550
Furniture and Fixture 15,500
Purchase 75,000
Drawings 13,560
Investments 65,500
Cash in Hand 36,000
Cash at Bank 53,000
4,81,310 4,81,310
Adjustments
1. Closing stock was valued Rs.35,000.
2. Depredation charged on furniture and fixture @ 5%.
3. Further bad debts Rs.1,000. Make a provision for bad debts @ 5% on sundry debtors.
4. Depreciation charged on motor car @ 10%.
5. Interest on drawings @ 6%.
6. Rent, rates and taxes was outstanding Rs. 200.
7. Discount on debtors 2%.
Q. Prepare a trading and profit and loss account of M/s Green Club Ltd for the year ending
December 31, 2010 from the following figures taken from his trial balance

Account Title Amt. (Rs.) Account Title Amt. (Rs.)

Opening Stock 35,000 Sales 2,50,000
Purchase 1,25,000 Purchase Return 6,000
Return Inwards 25,000 Creditors 10,000
Postage and Telegram 600 Bills payable 20,000
Salary 12,300 Discount 1,000
Wages 3,000 Provision for Bad Debts 4,500
Rent and Rates 1,000 Interest Received 5,400
Packing and Transport 500 Capital 75,000
General Expenses 400
Insurance 4,000
Debtors 50,000
Cash in Hand 20,000
Cash at Bank 40,000
Machinery 20,000
Lighting and Heating 5,000
Discount 3,500
Bad Debts 3,500
Investment 23,100
3,71,900 3,71,900
Adjustments
1. Depreciation charged on machinery @ 5% pa.
2. Further bad debts Rs. 1,500, discount on debtors @ 5% and make a provision on debtors
@ 6%.
3. Wages prepaid Rs. 1,000.
4. Interest on investment @ 5% pa.
5. Closing stock Rs. 10,000.

Q.
Prepare a trading and profit and loss account of M/s Green Club Ltd. for the year ending
December 31, 2010 from the following figures taken from his trial balance

Account TitleAmt. (Rs.)Account TitleAmt. (Rs.)Opening Stock

35,000Sales2,50,000Purchase 1,25,000Purchase Return 6,000Return Inwards
25,000Creditors 10,000Postage and Telegram 600Bills Payable 20,000Salary
12,300Discount 1,000Wages 3,000Provision for Bad Debts 4,500Rent and
Rates 1,000Interest Received 5,400Packing and Transport 500Capital
75,000General Expenses 400Insurance 4,000Debtors 50,000Cash in
Hand 20,000Cash at Bank 40,000Machinery 20,000Lighting and Heating
5,000Discount 3,500Bad Debts 3,500Investment 23,100 ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯
3,71,900––––––––––––––––––––––¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯3,71,900––––––––––––––––––––

Adjustments

1. Depreciation charged on machinery @ 5% p.a.

2. Further bad debts Rs. 1,500, discount on debtors @ 5% and make a provision on debtors
@ 6%.

3. Wages prepaid Rs. 1,000.

4. Interest on investment @ 5% pa.

5. Closing stock Rs. 10,000.

uestion

Prepare a Trading and Profit and Loss account for year ending
December 31, 2010 from the balances extracted to M/s Rahul Sons.
Also prepare a balance sheet at the end of the year.
Account Title Amt. (Rs.) Account Title Amt. (Rs.)
Stock 50,000 Sales 1,80,000
Wages 3,000 Purchase Return 2,000
Salary 8,000 Discount Received 500
Purchase 1,75,000 Provision for Bad Debts 2,500
Sales Return 3,000 Capital 3,00,000
Sundry Debtors 82,000 Bills Payable 22,000
Discount Allowed 1,000 Commission Received 4,000
Insurance 3,200 Rent 6,000
Rent, Rates and Taxes 4,300 Loan 34,800
Fixtures and Fittings 20,000
Trade Expenses 1,500
Bad Debts 2,000
Drawings 32,000
Repair and Renewals 1,600
Travelling Expenses 4,200
Postage 300
Telegram Expenses 200
Legal Fees 500
Bills Receivable 50,000
Building 1,10,000
5,51,800 5,51,800
Adjustments
1. Commission received in advance Rs. 1,000.
2. Rent received Rs. 22,000.
3. Salary outstanding Rs. 1,000 and insurance prepaid Rs. 800.
4. Further bad debts Rs. 1,000 and provision for bad debts @ 5% on
debtors and discount on debtors @ 2%.
5. Closing stock Rs. 32,000.
6. Depreciation on building @ 6% pa.

Solution

Trading and Profit and Loss Account

as on 31st December, 2010
Dr Cr
Particulars Amt. (Rs.) Particulars Amt.(Rs.)
To Opening Stock 50,000 By Sales 1,80,000
3,000
To purchase 1,75,000 (-) Sales Return
1,77,000
(-) Purchase By Closing Stock 32,000
2,000
Return By Gross Loss c/d 17,000
1,73,000
3,000
To Wages 2,26,000
2,26,000
To Gross Loss b/d 17,000 By Discount Received 500
To Salary 8,000 By Commission 4,000
1,000
(+) Outstanding (-) Advance
3,000
1,000
Salary By Rent 6,000
9,000
2,000
To Discount Allowed 1,000 (+) Accrued Rent
8,000
To Insurance 3,200 By Net Loss 43,189
(-) Prepaid
800
Insurance
2,400
To Rent, Rates and Taxes 4,300
To Trade Expenses 1,500
To Bad Debts 2,000
(+) Further Bad
Debts 1,000
(+) New Provision 4,050
(+) Discount 1,539
2,500
(-) Old Provision
6,089
To Postage 300
To Telegram Expenses 200
To Repair and Renewals 1,600
To Travelling Expenses 4,200
To Legal Fees 500
To Depreciation on Building 6,600
54,689 54,689

Balance Sheet
as on 31st December, 2010
Liabilities Amt. (Rs.) Assets Amt. (Rs.)
Capital 3,00,000 Sundry Debtors 82,000
43,189 (-) Further Bad
(-) Net Loss 1000
2,56,811 Debts
32,000
(-) Drawings (-) New Provision 4,050
2,24,811
1,539
Bills Payable 22,000 (-) Discount
75,411
Loan 34,800 Bills Receivable 50,000
Advance Commission 1,000 Fixtures and Fitting 20,000
800
Prepaid Insurance
1,10,000
Building
6,600
Outstanding Salary 1,000 (-) Depreciation @ 6%
1,03,4000
Rent (Accrued)
2,000
Closing Stock
32,000
2,83,611 2,83,611

Working Note
Sundry Debtors 82,000
(-) Further Bad Debts 1,000
81,000
(-) Provision(5%) 4,050
76,950
(-) Discount (2%) 1,539
Rs. 75,411

Suggest Corrections

SIMILAR QUESTIONS

Q. The following balances has been extracted from the trial of M/s Runway Shine Ltd.
Prepare a trading and profit and loss account and a balance sheet as on December 31,
2010.

Account Title Amt. (Rs.) Account Title Amt. (Rs.)

Purchase 1,50,000 Sales 2,50,000
Opening Stock 50,000 Return Outwards 4,500
Return Inwards 2,000 Interest Received 3,500
Carriage Inwards 4,500 Discount Received 400
Cash in Hand 77,800 Creditors 1,25,000
Cash in Bank 60,800 Bills Payable 6,040
Wages 2,400 Capital 1,00,000
Printing and Stationery 4,500
Discount 400
Bad Debts 1,500
Insurance 2,500
Investment 32,000
Debtors 53,000
Bills Receivable 20,000
Postage and Telegraph 400
Commission 200
Interest 1,000
Repair 440
Lighting Charges 500
Telephone Charges 100
Carriage Outward 400
Motor Car 25,000
4,89,440 4,89,440
Adjustments
1. Further bad debts Rs. 1,000. Discount on debtors Rs. 500 and make a provision on
debtors @ 5%.
2. Interest received on investment @ 5%.
3. Wages and interest outstanding Rs. 100 and Rs. 200 respectively.
4. Depreciation charged on motor car @ 5% pa. 5. Closing stock Rs. 32,500.

Q.
Prepare a Trading and Profit and loss account for year ending December 31, 2010 from the
balances extracted to M/s Rahul Sons. Also prepare a balance sheet at the end of the year.

Account TitleAmt. (Rs.)Account TitleAmt.(Rs)Opening Stock

50,000Sales1,80,000Wages 3,000Purchase Return 2,000Salary 8,000Discount
Received 500Purchase1,75,000Provision for Bad Debts 2,500Sales Return
3,000Capital3,00,000Sundry Debtors 82,000Bills Payable 22,000Discount Allowed
1,000Commission Received 4,000Insurance 3,200Rent 6,000Rent, Rates and
Taxes 4,300Loan 34,800Fixtures and Fittings 20,000Trade Expenses
1,500Bad Debts 2,000Drawings 32,000Repair and Renewals 1,600Travelling
Expenses 4,200Postage 300Telegram Expenses 200Legal Fees
500Bills Receivable 50,000Building1,10,000 ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯5,51,800––––––––––––––––––––
¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯5,51,800––––––––––––––––––––

Adjustments:

1. Commission received in advance Rs. 1,000.

2. Rent received Rs. 2,000.

3. Salary outstanding Rs. 1,000 and insurance prepaid Rs. 800.

4. Further bad debts Rs. 1,000 and provision for bad debts @5% on debtors and discount on
debtors @ 2%.

5. Closing stock Rs. 32,000.

6. Depreciation on building @ 6% pa.

Q. Prepare the trading and profit and loss account and balance sheet of M/s Shine Ltd from
the following particulars.

Account Title Amt.(Rs) Account Title Amt. (Rs)

Sundry Debtors 1,00,000 Bills Payable 85,550
Bad Debts 3,000 Sundry Creditors 25,000
Trade Expenses 2,500 Provisions for Bad Debts 1,500
Printing and Stationery 5,000 Return Outwards 4,500
Rent, Rates and Taxes 3,450 Capital 2,50,000
Freight 2,250 Discount Received 3,500
Sales Return 6,000 Interest Received 11,260
Motor Car 25,000 Sales 1,00,000
Opening Stock 75,550
Furniture and Fixture 15,500
Purchase 75,000
Drawings 13,560
Investments 65,500
Cash in Hand 36,000
Cash at Bank 53,000
4,81,310 4,81,310
Adjustments
1. Closing stock was valued Rs.35,000.
2. Depredation charged on furniture and fixture @ 5%.
3. Further bad debts Rs.1,000. Make a provision for bad debts @ 5% on sundry debtors.
4. Depreciation charged on motor car @ 10%.
5. Interest on drawings @ 6%.
6. Rent, rates and taxes was outstanding Rs. 200.
7. Discount on debtors 2%.
Q. Prepare a trading and profit and loss account of M/s Green Club Ltd for the year ending
December 31, 2010 from the following figures taken from his trial balance

Account Title Amt. (Rs.) Account Title Amt. (Rs.)

Opening Stock 35,000 Sales 2,50,000
Purchase 1,25,000 Purchase Return 6,000
Return Inwards 25,000 Creditors 10,000
Postage and Telegram 600 Bills payable 20,000
Salary 12,300 Discount 1,000
Wages 3,000 Provision for Bad Debts 4,500
Rent and Rates 1,000 Interest Received 5,400
Packing and Transport 500 Capital 75,000
General Expenses 400
Insurance 4,000
Debtors 50,000
Cash in Hand 20,000
Cash at Bank 40,000
Machinery 20,000
Lighting and Heating 5,000
Discount 3,500
Bad Debts 3,500
Investment 23,100
3,71,900 3,71,900
Adjustments
1. Depreciation charged on machinery @ 5% pa.
2. Further bad debts Rs. 1,500, discount on debtors @ 5% and make a provision on debtors
@ 6%.
3. Wages prepaid Rs. 1,000.
4. Interest on investment @ 5% pa.
5. Closing stock Rs. 10,000.

Q.
Prepare a trading and profit and loss account of M/s Green Club Ltd. for the year ending
December 31, 2010 from the following figures taken from his trial balance

Account TitleAmt. (Rs.)Account TitleAmt. (Rs.)Opening Stock

35,000Sales2,50,000Purchase 1,25,000Purchase Return 6,000Return Inwards
25,000Creditors 10,000Postage and Telegram 600Bills Payable 20,000Salary
12,300Discount 1,000Wages 3,000Provision for Bad Debts 4,500Rent and
Rates 1,000Interest Received 5,400Packing and Transport 500Capital
75,000General Expenses 400Insurance 4,000Debtors 50,000Cash in
Hand 20,000Cash at Bank 40,000Machinery 20,000Lighting and Heating
5,000Discount 3,500Bad Debts 3,500Investment 23,100 ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯
3,71,900––––––––––––––––––––––¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯3,71,900––––––––––––––––––––

Adjustments

1. Depreciation charged on machinery @ 5% p.a.

2. Further bad debts Rs. 1,500, discount on debtors @ 5% and make a provision on debtors
@ 6%.

3. Wages prepaid Rs. 1,000.

4. Interest on investment @ 5% pa.

5. Closing stock Rs. 10,000.

Q.
Prepare the trading and profit and loss account and a balance sheet of M/s Shine Ltd. from
the following particulars.

Account TitleAmt.(Rs)Account titleAmt.(Rs)Sundry Debtors1,00,000Bills

Payable85,550Bad Debts3,000Sundry Creditors25,000Trade Expenses2,500Provision for
Bad Debts1,500Printing and Stationery5,000Return Outwards4,500Rent, Rates and
Taxes3,450Capital2,50,000Freight2,250Discount Received3,500Sales
Return6,000Interest Received11,260Motor Car25,000Sales1,00,000Opening
Stock75,550Furniture and
Fixture15,500Purchase75,000Drawings13,560Investments65,500Cash in
Hand36,000Cash at Bank53,000¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯4,81,310––––––––––––––––––––
¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯4,81,310––––––––––––––––––––

Adjustments

1. Closing stock was valued Rs. 35,000.

2. Depreciation charged on furniture and fixture @ 5%.

3. Further bad debts Rs. 1,000. Make a provision for bad debts @ 5% on sundry debtors.

4. Depreciation charged on motor car @ 10%.

5. Interest on drawings @ 6%.

6. Rent, rates and taxes was outstanding Rs. 200.

7. Discount on debtors 2%.

Q. From the following balances extracted from the books of Raga Ltd prepare a trading and
profit and loss account for the year ended December 31, 2011 and a balance sheet as on
that date.

Account Title Amt.(Rs) Account Title Amt.(Rs)

Drawings 20,000 Sales 2,20,000
Land and Buildings 12,000 Capital 1,01,000
Plant and Machinery 40,000 Discount 1,260
Carriage Inwards 100 Apprentice Premium 5,230
Wages 500 Bills Payable 1,28,870
Salary 2,000 Purchase Return 10,000
Sales Return 200
Bank Charges 200
Coal, Gas and Water 1,200
Purchase 1,50,000
Trade Expenses 3,800
Stock (Opening) 76,800
Cash at Bank 50,000
Rates and Taxes 870
Bills Receivable 24,500
Sundry Debtors 54,300
Cash in Hand 30,000
4,66,470 4,66,470
The additional information is as under
1. Closing stock was valued at the end of the year Rs. 20,000.
2. Depreciation on plant and machinery charged @ 5% and land and building @ 10%.
3. Discount on debtors @ 3%.
4. Make a provision @ 5% on debtors for bad debts.
5. Salary outstanding was Rs. 100 and wages prepaid was Rs. 40.
6. The manager is entitled a commission of 5% on net profit after charging such
commission.

Q.
From the following balances extracted from the books of Raga Ltd. prepare a trading and
profit and loss account for the year ended December 31, 2011 and a balance sheet as on
that date.

Account TitleAmt. (Rs.)Account TitleAmt. (Rs.)Drawings20,000Sales2,20,000Land and

Buildings12,000Capital1,01,110Plant and Machinery40,000Discount1,260Carriage
Inwards100Apprentice Premium5,230Wages500Bills
Payable1,28,870Salary2,000Purchase Return10,000Sales Return200Bank
Charges200Coal, Gas and Water1,200Purchase1,50,000Trade Expenses3,800Stock
(Opening)76,800Cash at Bank50,000Rates and Taxes870Bills Receivable24,500Sundry
Debtors54,300Cash in Hand30,000¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯4,66,470––––––––––––––––––––
¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯4,66,470––––––––––––––––––––

The additional information is as under:

1. Closing stock was valued at the end of the year Rs. 20,000.

2. Depreciation on plant and machinery charged @ 5% and land and building @ 10%.

3. Discount on debtors @ 3%.

4. Make a provision @ 5% on debtors for bad debts.

5. Salary outstanding was Rs. 100 and wages prepaid was Rs. 40.

6. The manager is entitled a commission of 5% on net profit after charging such

commission.

Q. From the following balances of M/s Jyoti Exports, prepare trading and profit and loss
account for the year ended March 31, 2012 and balance sheet as on this date.

Account Title Amt. (Rs) Account Title Amt. (Rs)

Sundry Debtors 9,600 Sundry Creditors 2,500
Opening Stock 22,800 Sales 72,670
Purchase 34,800 Purchase Return 2,430
Carriage Inwards 450 Bills Payable 15,600
Wages 1,770 Capital 42,000
Office Rent 820
Insurance 1,440
Factory Rent 390
Clearing Charges 940
Salary 1,590
Building 24,000
Plant and Machinery 3,600
Cash in Hand 2,160
Gas and Water 240
Octroi 60
Furniture 20,540
Patents 10,000
1,35,200 1,35,200
Closing stock Rs. 10,000:
1. The provision for bad debts is to be maintained at 5% on sundry debtors.
2. Wages amounting to Rs. 500 and salary amounting to Rs. 350 are outstanding.
3. Factory rent prepaid Rs. 100.
4. Depredation charged on Plant and Machinery @ 5% and Building @ 10%.
5. Outstanding insurance Rs. 100.

Q. Prepare the bad debts account, provision for bad debts account, profit and loss account
and balance sheet from the followii information as on December, 31, 2011.
(Rs.)
Debtors 80,000
Bad Debts 2,000
Provision for bad debts 5,000
Adjustments
Bad debts Rs. 500, Provision on debtors @ 3%.
Prepare Trading and Profit and Loss account and balance sheet on M/s
Royal Traders from the following balances as on March 31, 2011.

Solution

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91

SIMILAR QUESTIONS

Q1

Prepare Trading and Profit and Loss account. and balance sheet on M/s
Royal Traders from the following balances as on March 31, 2011.
Debit BalancesAmt. (Rs.)Credit BalancesAmt. (Rs.)Stock
20,000Sales2,45,000Cash 5,000Creditors 10,000Bank
10,000Bills Payable 4,000Carriage on Purchase
1,500Capital2,00,000Purchase1,90,000Drawings 9,000Wages
55,000Machinery1,00,000Debtors 27,000Postage 300Sundry
Expenses 1,700Rent 4,500Furniture 35,000
Closing Stock Rs. 8,000.
View Solution

Q2

From the following trial balance of Mr. A. Lal, prepare trading, profit and loss account and balance sheet as on
March 31, 2017.

Account Title Debit Credit

Amount Amount
Rs Rs

Stock as on April 01, 2016 16,000

Purchases and Sales 67,600 1,12,000

Returns inwards and outwards 4,600 3,200

Carriage inwards 1,400

General expenses 2,400

Bad debts 600

Discount received 1,400

Bank over draft 10,000

Interest on bank overdraft 600

Commission received 1,800

Insurance and taxes 4,000

Scooter expenses 200

Salaries 8,800
 Cash in hand 4,000

Scooter 8,000

Furniture 5,200

Building 65,000

Debtors and Creditors 6,000 16,000

Capital 50,000

Closing stock Rs 15,000.

View Solution

Q3

Prepare trading and profit and loss account and balance sheet of M/s Royal Traders from the following balances as
on March 31, 2011.

Debit balances Amount Credit balances Amount

Rs Rs

Stock 20,000 Sales 2,45,000

Cash 5,000 Creditors 10,000

Bank 10,000 Bills payable 4,000

Carriage on purchases 1,500 Capital 2,00,000

Purchases 1,90,000

Drawings 9,000

Wages 55,000

Machinery 1,00,000

Debtors 27,000

Postage 300

Sundry expenses 1,700

 Rent 4,500

Furniture 35,000

Closing stock Rs 8,000.

View Solution

Q4

Prepare trading and profit and loss account and balance sheet of M/s
Royal Traders from the following balances as on March 31, 2005.
Debit balances Amount Rs Credit balances Amount Rs
Stock 20,000 Sales 2,45,000
Cash 5,000 Creditors 10,000
Bank 10,000 Bills payable 4,000
Carriage on purchases 1,500 Capital 2,00,000
Purchases 1,90,000

Drawings 9,000

Wages 55,000

Machinery 1,00,000

Debtors 27,000

Postage 300

Sundry expenses 1,700

Rent 4,500

Furniture 35,000

Closing stock Rs 8,000

View Solution

Q5

Following is the Trial Balance as on 31st March 2016. Prepare Trading

and Profit and Loss Account and Balance Sheet :-
 Debit Credit
Particulars
(₹) (₹)

Stock (1st April 2015) 8,000

Sales 2,20,000

Purchases 1,26,000

Productive Wages 56,500

Salaries 16,000

Stores Consumed 6,050

Carriage 3,050

Rent and Rates 5,200

Insurance 1,320

Machinery 52,000

Building 67,000

Capital less Drawings 1,45,600

Sundry Debtors 44,000

Sundry Creditors 20,000

Secured Loan 15,000

Furniture 3,350

General Expenses 2,600

Cash in hand 1,930

Bad Debts 1,020

Bank 6,580

Total 4,00,600 4,00,600

Additional Information :
(a) Stock on 31st March 2016 is ₹ 20,600.
(b) Depreciate machinery @ 10% p.a.
(c) Make a Provision @ 5% for Doubtful Debts.
(d) Provide 212% for discount on sundry debtors.

(e) Rent and Rates include security deposit of ₹ 400.

f) Insurance prepaid ₹ 120.

ate :

Dr. Balances ₹ Cr. Balances ₹

Opening Stock 50,000 Capital 20,00,000

Purchases 5,30,000 Sales 12,50,000

General Expenses 45,000 Sundry Creditors 1,36,000

Stationery 6,000 Trade Charges due but not paid 5,000

Wages 2,15,000 Outstanding Rent 4,000

Trade Charges 25,000 Bank Balance 45,000

Rent 44,000

Charity 5,000

Advertisement Expenses 30,000

 Carriage on Sales 12,000

Bills Receivables 30,000

Sundry Debtors 2,20,000

Cash Discount 16,000

Cash in Hand 22,000

Furniture 1,00,000

Advance for Furniture 40,000

Plant & Machinery 6,00,000

Building 14,50,000

34,40,000 34,40,000

Adjustments:
(i) Stock on 31 March, 2018 was valued at ₹ 60,000.
(ii) A new machine was installed during the year costing ₹ 2,00,000 but
it was not recorded in the books. Wages paid for its installation ₹
10,000 have been debited to Wages Account.
(iii) An advance of ₹ 10,000 given alongwith purchase order was
wrongly recorded in purchases.
(iv) General expenses include ₹ 20,000 paid for Wages.
(v) Wages include a sum of ₹ 50,000 spent on the erection of a Scooter
Stand for employees.
(vi) Advance for Furniture is for furniture at proprietor's residence.
(vii) Depreciate Furniture at 15%, Plant & Machinery at 20% and
Building at 10%.
(viii) Carry forward 2/3 of Advertisement Expenses as unexpired.
(ix) A B/R of ₹ 20,000 was discounted with bank on 15 Nov. 2017, but
not yet matured.
Solution
Trading Account
for the year ended March 31, 2018
Dr. Cr.

Amount Amount
Particulars Particulars
(₹) (₹)
Opening Stock 50,000 Sales 12,50,00
0
Purchases 5,30,00 Closing Stock 60,000
0
Less: Advance against Order (10,000 5,20,000
)
Wages 2,15,00
0
Add: Included in General 20,000
Expenses
Less: Construction of Shed (50,000
)
Less: Wages on Machinery (10,000 1,75,000
)
Gross Profit 5,65,000

13,10,00 13,10,00
0 0
Profit & Loss Account
for the year ended March 31, 2018
Dr. Cr.

Amo
Amount
Particulars unt Particulars
(₹)
(₹)
Cash Discount 16,00 Gross Profit 5,65,000
0
General 45,000
Expenses
Less: Wages (20,000) 25,00
0
Stationery 6,000
 Trade Charges 25,00
0
Rent 44,00
0
Charity 5,000

Advertisement Expenses 10,00

0
Carriage on Sales 12,00
0
Depreciation on:

Furniture 15,00
0
Building 1,50,0
00
Plant & Machinery 1,62,0 3,27,0
00 00
Net Profit 95,00
0
5,65,0 5,65,000
00
Balance Sheet
as on March 31, 2018
Dr. Cr.

Amoun Amoun
Liabilities t Assets t
(₹) (₹)
Creditors 1,36,00 Furniture 1,00,000
0
Outstanding Trade Charges 5,000 Less: Depreciation 15,000 85,000
Outstanding Rent 4,000 Plant & Machinery 6,00,000

Bank Overdraft 45,000 Add: Additions 2,10,000

Capital 20,00,0 Less: Depreciation 1,62,000 6,48,00

00 0
Less: Drawings 40,000 Unexpired Advertisement 20,000
Expenses
Add: Net Profit 95,000 20,55,0 Building 14,50,000
00
Creditors for Machinery 2,00,00 Add: Additions 50,000
0
Less: Depreciation 1,50,000 13,50,0
00
 Cash in Hand 22,000

Closing Stock 60,000

Debtors 2,20,00
0
Advance against Purchases 10,000

Bills Receivable 30,000

24,45,0 24,45,0
00 00
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SIMILAR QUESTIONS

Q1

From the following Trial Balance of Sh. Swamy Narain, prepare

Trading and Profit & Loss Account for the year ended 31st March 2018
and a Balance Sheet as at that date :

Dr. Balances ₹ Cr. Balances ₹

Opening Stock 50,000 Capital 20,00,000

Purchases 5,30,000 Sales 12,50,000

General Expenses 45,000 Sundry Creditors 1,36,000

Stationery 6,000 Trade Charges due but not paid 5,000

Wages 2,15,000 Outstanding Rent 4,000

Trade Charges 25,000 Bank Balance 45,000

Rent 44,000

Charity 5,000
Advertisement Expenses 30,000

Carriage on Sales 12,000

Bills Receivables 30,000

Sundry Debtors 2,20,000

Cash Discount 16,000

Cash in Hand 22,000

Furniture 1,00,000

Advance for Furniture 40,000

Plant & Machinery 6,00,000

Building 14,50,000

34,40,000 34,40,000

Adjustments:
(i) Stock on 31 March, 2018 was valued at ₹ 60,000.
(ii) A new machine was installed during the year costing ₹ 2,00,000 but
it was not recorded in the books. Wages paid for its installation ₹
10,000 have been debited to Wages Account.
(iii) An advance of ₹ 10,000 given alongwith purchase order was
wrongly recorded in purchases.
(iv) General expenses include ₹ 20,000 paid for Wages.
(v) Wages include a sum of ₹ 50,000 spent on the erection of a Scooter
Stand for employees.
(vi) Advance for Furniture is for furniture at proprietor's residence.
(vii) Depreciate Furniture at 15%, Plant & Machinery at 20% and
Building at 10%.
(viii) Carry forward 2/3 of Advertisement Expenses as unexpired.
(ix) A B/R of ₹ 20,000 was discounted with bank on 15 Nov. 2017, but
not yet matured.
View Solution

Q2

From the following Trial Balance prepare Trading and Profit & Loss
Account for the year ended 31st March, 2017 and Balance Sheet as at
that date:-

Dr. Cr.
(₹) (₹)

Stock 1st April, 2016 22,300

Purchases and Purchase Return 2,30,000 5,200

Freehold Premises 1,00,000

Incidental Trade Exp. 11,200

Insurance 1,850

Audit Fees 800

Commission Received 2,700

Interest 1,400

Debtors and Creditors 32,400 24,830

Wages 30,200

Salaries 15,200
Capital 1,50,000

Drawings 12,000

Income-Tax 3,600

Investments 8,000

Discount allowed & received 7,500 4,200

Sales Return & Sales 6,400 3,17,400

B/R 5,200

Office Furniture 9,000

Rent 2,600

Cash in hand 5,080

Bank Balance 7,600

5,08,330 5,08,330

Adjustment:-
1. Stock at 31st March 2017 is ₹ 70,000.
2. Write of 5% Depreciation on Freehold Premises and 20% on office
furniture.
3. Commission earned but not received ₹ 500.
4. Interest earned ₹ 600.
5. ₹ 200 for rent have been received in advance.
6. Charge interest on Capital @ 6% and ₹ 500 on Drawings.
View Solution

Q3
From the following Trial Balance of M/s. Ram Lal and Sons, prepare
Trading, Profit and Loss Account for the year ending 31st March, 2018
and a Balance Sheet as on that date:
Dr. Cr.
Heads of Accounts
(₹) (₹)

Drawings 15,000

Capital 3,50,000

Plant and Machinery 2,05,000

Debtors 50,000

Creditors 28,000

Returns Inward 8,000

Returns Outward 7,000

Discount Allowed 7,000

Discount Received 6,000

Commission 15,000

Interest on Bank Loan 12,000

Furniture 55,000

Provision for Doubtful Debts 13,000

Wages 50,000

Salaries 45,000

Advertisement 15,000

Rent and Taxes 13,000

Purchases 2,60,000

Sales 4,00,000
Stock on 1st April, 2017 70,000

Carriage 5,000

Land and Building 98,000

Cash in Hand 8,000

Cash at Bank 20,000

10% Bank Loan as on 1st April, 2017 1,50,000

Input CGST 9,000

Input SGST 9,000

Output IGST 15,000

Total 9,69,000 9,69,000

Adjustments:
(i) The cost of stock on 31st March, 2018 was ₹37,000. However, its
market value was ₹35,000.
(ii) Wages outstanding were ₹6,000 and salaries outstanding were
₹5,000 on 31st March, 2018.
(iii) Depreciate Land and Building @ 212%, Plant and Machinery @
10% p.a. and Furniture @ 15 p.a.
(iv) Purchase includes purchase of machinery for ₹10,000 on 1st
October, 2017.
(v) Debtors include bad debts of ₹2,000. Maintain a provision for
doubtful debts @ 10% on Debtors.
View Solution

Q4
From the following Trial Balance extracted from the books of Sh.
Pawan Kumar, prepare a Trading Account, Profit & Loss Account for
the year ended 31st March, 2014 and a Balance Sheet as at that date :
Dr. Balances (₹) Cr. Balances (₹)

1,20,00 16,00,0
Drawings Capital
0 00

Plant and Machinery 12,00,0 2,60,00

Creditors
00 0

Horses and Carts 2,60,00 8,20,00

Sales
0 0

Debtors 3,40,00 2,21,20

Bills Payable
0 0

Purchases 2,00,00
Interest on Ram's Loan 1,800
0

Wages 80,000 Rent Received 12,000

Cash at Bank 2,60,00

0

Salaries 80,000

Repairs 5,000

Stock (1-4-2013) 7,000

Stock (31-3-2014) 92,000

Rent 45,000

Manufacturing expenses 15,000

Bad-Debts 50,000

Carriage 15,000

Income Tax 20,000

Life Insurance Premium 30,000

Loan to Ram at 12% p.a. 20,000

Insurance 12,000

Insurance Prepaid 1,000

29,15,0 29,15,0
00 00

Adjustments:-
1. Plant and Machinery includes a new machinery purchased on 1st
October, 2013 for ₹ 2,00,000.
2. Depreciate Plant and Machinery by 10% p.a. and Horses and Carts
by 20% p.a.
3. Salaries for the month of February and March 2014 are outstanding.
4. Goods worth ₹ 15,000 were sold and dispatched on 27th March but
no entry was passed to this effect.
5. Make a provision for Doubtful Debts at 5% on Debtors.
View Solution

Q5

Prepare Trading and Profit and Loss Account for the year ended 31st
March, 2018 and Balance Sheet as at that date from the following
Traial Balance:
Dr. Cr.
Particulars
(₹) (₹)

Capital ...................................................................... … 1,00,

.......... 000

Cash ...................................................................... 15,00 …

.......... 0

Bank Loan ...................................................................... … 20,00

.......... 0
Purchases ...................................................................... 1,20, …
.......... 000

Sales ...................................................................... … 1,50,

.......... 000

Sales Return ...................................................................... 10,00 …

.......... 0

Purchases Return ...................................................................... … 20,00

.......... 0

Establishment ...................................................................... 22,00 …

Expenses .......... 0

Taxes and ...................................................................... 5,000 ...

Insurance ..........

Bad Debts ...................................................................... 5,000 …

..........

Provision for ...................................................................... … 7,000

Doubtful Debts ..........

Debtors ...................................................................... 50,00 …

.......... 0

Creditors ...................................................................... … 20,00

.......... 0

Commission ...................................................................... … 5,000

..........

Deposits ...................................................................... 40,00 …

.......... 0

Opening Stock ...................................................................... 30,00 …

.......... 0

Drawings ...................................................................... 14,00 …

.......... 0

Furniture ...................................................................... 6,000 …

..........

Bills Receivable ...................................................................... 32,00 …

 .......... 0

Bills Payable ...................................................................... … 25,00

.......... 0

Input CGST ...................................................................... 10,00 ...

.......... 0

Input SGST ...................................................................... 10,00 …

.......... 0

Output CGST ...................................................................... … 8,000

..........

Output SGST ...................................................................... … 8,000

..........

Output IGST ...................................................................... … 6,000

..........

Total 3,69, 3,69,

000 000

Adjustments:
(i) Salaries ₹ 1,000 and Taxes ₹ 2,000 are outstanding but Insurance ₹
500 is prepaid.
(ii) Commission ₹ 1,000 received in advance for the next year.
(iii) Interest ₹ 2,100 is to be received on Deposits and Interest and Bank
Loan ₹ 3,000 is to be paid.
(iv) Provision for Doubtful Debts to be maintained at ₹ 10,000.
(v) Depreciate Furniture by 10%.
(vi) Stock on 31st March, 2018 is ₹ 45,000
(vii) A fire occurred on 1st April, 2018 destroying goods costing ₹
10,000. These goods were purchased paying CGST and SGST @ 6%
each.