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Stock

ABC ltd is en...

Question

ABC ltd is engaged in the manufacturing of pharmaceuticals. Following is the situation of stock of medicines as on 31st March 2018.
- Medicines in stock of value of Rs 27,00,000
- Medicines whose expiry date is in March 2018 included in the above value of Rs 27,00,000 of Rs 5,00,000
- Goods in progress i.e. medicines in process of manufacturing as on 31st March 2018 Rs 2,00,000
- Raw Material Rs 4,00,000 in godown
What shall be the value of stock on 31st March 2018?

Rs 33,00,000

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Rs 40,00,000

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Rs 28,00,000

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Rs 27,00,000

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Solution

The correct option is C
Rs 28,00,000

Finished goods in stock 27,00,000

Less: Obsolete Stock 5,00,000

Add: Goods in process 2,00,000

Add: Raw materials 4,00,000

Value of Stock 28,00,000

All the above are to be added in the stock for the purpose of balance sheet as all of these are the components and parts of the stock of business but goods which have become obsolete is not to be added in the stock of the business.

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Similar questions

Following is the Receipts and Payments Account of the Sumit Club and Resorts for the year ending 31st March, 2018.

$\begin{matrix} Receipts & Amount & Payments & Amount (Rs) & (Rs) To Balance b/d & 44, 000 & By Salaries & 4, 40, 000 To Subscription & 9, 80, 000 & By Furniture puchased on To Entrance Fees & 80, 000 & 1st October, 2017 & 1, 00, 000 To Sports Fund & 80, 000 & By Sports Expenses & 60, 000 To Sale of Drama Tickets & 2, 70, 000 & By Drama Expenses & 1, 84, 000 To Sale of Waste Paper & 2, 500 & By Newspapers & 2, 500 To Interest on Investment & 20, 000 & By Refreshments & 32, 000 (10 % o n 2, 00, 000) & By Lighting and Heating & 60, 000 By Medicines Purchased & 40, 000 By Balance c/d & 5, 58, 000 Total & 14, 76, 500 & Total & 14, 76, 500 \end{matrix}$

Prepar Income and Expenditure Account for the year ending 31-03-2018, after taking into account the following adjustments :

(i) The Club has 2,000 members each paying an annual subscription of Rs 500 and the subscription of eighty members are still in arrears.

(ii) Stock of medicines as on 31st March, 2018 was Rs 10,000.

(iii) Salaries are paid @ Rs 40,000 per month.

(iv) Entrance fees is to be capitalised.

(v) Depreciate Furniture @ 10 $%$ p.a. ( taking into account Furniture on 1st April, 2017 was Rs 4,00,000).

From the following Receipts and Payments Account of a Cricket club and the additional information, prepare an Income and Expenditure Account for the year ended on 31st March, 2014 and a Balance Sheet as at that date :

$\begin{matrix} Receipts & Rs & Payments & Rs Balance b/d : & Crockery purchased & 2, 650 Cash & 3, 520 & Maintenance & 6, 820 Bank & 27, 380 & Match Expenses & 13, 240 Fixed Deposit at 6 % p.a. & 30, 000 & Salaries & 11, 000 Membership Subscription & Conveyance & 820 (including Rs 6,000 for the year & Upkeep of lawn & 4, 240 year ending 31st March, 2013) & 40, 000 & Postage Stamps & 1, 050 Entrance Fees & 2, 750 & Purchase of Cricket Materials & 9, 720 Donation & 5, 010 & Sundry Expenses & 2, 000 Interest on Fixed Deposit & 900 & Investments & 5, 700 Tournament Fund & 20, 000 & Tournament Expenses & 18, 800 Sales of Crockery & Balance c/d : (Book value Rs 1,200) & 2, 000 & Cash & 2, 200 Bank & 23, 320 Fixed Deposit at 6 % p.a. & 30, 000 - ------ - & 55, 520 ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 1, 31, 560 - -------- - & ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 1, 31, 560 - -------- - \end{matrix}$

Informations :- (a) Monthly Salary is Rs 1,000;

(b) The value of unused Postage Stamps is as follows :

31st March, 2013, Rs 750;

31st March, 2014, Rs 900.

31st March, 2013, Rs 3,210;

31st March, 2014, Rs 2,800.

(d) Arrear of membership subscriptions :

On 31st March, 2013, Rs 6,600;

On 31st March, 2014, (for 2013-14) Rs 8,000.

(e) Donation and Entrance Fees are not to be capitalised

Q. A firm closes their financial books on 31st March. Stock-taking could be completed after two weeks i.e., 15th April, the value arrived was Rs.

25, 000

. During the two week purchases were RS.

1, 000

and sales were of Rs.

4, 000

. GP Ratio of the firm is

30

%. Ascertain the value of closing stock as on 31st March.

Q. How are the following dealt with while preparing the final accounts for the year ended 31st March , 2018?

RECEIPTS AND PAYMENTS ACCOUNT ( AN EXTRACT ) for the year ended 31ST March, 2018
Dr.			Cr.
Receipts	₹	Payments	₹
		By Payments for Medicines	1,50,000

Additional information :

	As at 1st April, 2017 (₹)	As at 31st March, 2018 (₹)
Stock of Medicines	50,000	75,000
Creditors for Medicines	40,000	60,000

Mr. X issued cheques worth 15,000 in March 2018 out of which cheques worth 10,000 only were presented for payment by 31st March, 2018. While reconciliation bank and cash book balance as on 31st March, 2018, what amount should be added to balance as per cash book to arrive at balance as per pass book?

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Finished goods in stock	27,00,000
Less: Obsolete Stock	5,00,000
Add: Goods in process	2,00,000
Add: Raw materials	4,00,000
Value of Stock	28,00,000