editdata.mso

The following is the trial balance of Alfa Ltd., for the year ended June 30, 2005

Prepare the Profit and Loss Account and Balance Sheet of the company after taking the following particulars into consideration:

a) The original cost of land and building plant and machinery and furniture and fittings was Rs 2, 50, 000, Rs 6, 00, 000 and Rs 60, 000 respectively. Additions during the year were: Building Rs 50, 000 and Plant Rs 20, 000.

b) Depreciation is to be charged on plant and machinery and furniture and fitting at 10 per cent on original cost.

c) Of the sundry debtors, Rs 10, 000 is outstanding for a period exceeding 6 months, Rs 5, 000 are considered doubtful, while the others are considered good.

d) The directors are entitled to a commission at 1 percent of the net profits before charging such commission.

e) Stock on 30th June, 2005 is Rs 1, 30, 000.

f) Provide Rs 34, 800 for income tax

The following balances appeared in the books of Parasuram Flour Mills Ltd., as on December 31, 2005 :

Prepare the company’s trading and profit and loss account for the year and balance sheet as on December 31, 2005 after taking the following adjustments into account:

(a) Stock on December 31, 2005 were: Wheat at cost, Rs 14, 900: Flour at market price, Rs 21, 700; (b) Outstanding expenses: Manufacturing expenses, Rs 23, 500; and salaries and wages, Rs 1, 200; (c) Provide depreciation : Building at 2% ; Plant and machinery at 10%: Furniture at 10% ; and Vehicle 20%. (d) Interest accrued on Government Securities, Rs100: (e) A tax provision of Rs 8, 000 is considered necessary. (f) The directors propose a dividend of 20%. (g) The authorised capital consists of 12, 000 equity shares of Rs 10 each of which 7, 200 shares were issued and fully paid up.

The following was the Balance Sheet of Arun, Bablu and Chetan sharing profits and losses in the ratio of respectively.

They agreed to take Deepak into partnership and give him a share of 1/8 on the following terms:

(a) that Deepak should bring in Rs 4, 200 as goodwill and Rs 7, 000 as his Capital;

(b) that furniture be depreciated by 12%;

(c) that stock be depreciated by 10% ;

(d) that a Reserve of 5% be created for doubtful debts;

(e) that the value of land and buildings having appreciated be brought upto Rs 31, 000;

(f) that after making the adjustments the capital accounts of the old partners (who continue to share in the same proportion as before) be adjusted on the basis of the proportion of Deepak’s Capital to his share in the business, i.e., actual cash to be paid off to, or brought in by the old partners as the case may be.

Prepare Cash Account, Profit and Loss Adjustment Account (Revaluation Account) and the Opening Balance Sheet of the new firm.

Radha, Sheela and Meena were in partnership sharing profits and losses in the proportion of 3:2:1. On April 1, 2017, Sheela retires from the firm. On that date, their Balance Sheet was as follows:

The terms were:

a) Goodwill of the firm was valued at Rs 13, 500.

b) Expenses owing to be brought down to Rs 3, 750.

c) Machinery and Loose Tools are to be valued at 10% less than their book value.

d) Factory premises are to be revalued at Rs 24, 300.

Prepare:

1. Revaluation account

2. Partner’s capital accounts and

3. Balance sheet of the firm after retirement of Sheela.

The following is the Balance sheet of Tanu and Manu, who shares profit and losses in the ratio of 5:3, On December 31, 2017:

On the above date the firm is dissolved and the following agreement was made: Tanu agree to pay the bank loan and took away the sundry debtors. Sundry creditors accepts stock and paid Rs 10, 000 to the firm. Machinery is taken over by Manu for Rs 40, 000 and agreed to pay of bills payable at a discount of 5%.. Motor car was taken over by Tanu for Rs 60, 000. Investment realised Rs 76, 000 and fixtures Rs 4, 000. The expenses of dissolution amounted to Rs 2, 200.

Prepare Realisation Account, Bank Account and Partners Capital Accounts.