Following is the Trial Balance as on 31st March 2016. Prepare Trading and Profit and Loss Account and Balance Sheet :-

Particulars Debit
(₹) Credit
(₹)

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 $2 \frac{1}{2} %$ for discount on sundry debtors.
(e) Rent and Rates include security deposit of ₹ 400.
(f) Insurance prepaid ₹ 120.

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Solution

Trading Account

for the year ended March 31, 2016

Dr.

Cr.

Particulars

Amount

(₹)

Particulars

Amount

(₹)

Opening Stock

8,000

Sales

2,20,000

Purchases

1,26,000

Closing Stock

20,600

Stores Consumed

6,050

Productive Wages

56,500

Carriage

3,050

Gross Profit

41,000

2,40,600

2,40,600

Profit & Loss Account

for the year ended March 31, 2016

Dr.

Cr.

Particulars

Amount

(₹)

Particulars

Amount

(₹)

Salaries

16,000

Gross Profit

41,000

Rent & Rates

5,200

Less: Security Deposit

(400)

4,800

Insurance

1,320

Less: Prepaid

120

1,200

General Expenses

2,600

Bad Debts

1,020

Add: Provision for DD

2,200

3,220

Provision for Discount on Debtors

1,045

Depreciation on Machinery

5,200

Net Profit

6,935

41,000

41,000

Balance Sheet

as on March 31, 2016

Dr.

Cr.

Liabilities

Amount

(₹)

Assets

Amount

(₹)

Creditors

20,000

Machinery

52,000

Capital

1,45,600

Less: Depreciation

5,200

46,800

Add: Net Profit

6,935

1,52,535

Building

67,000

Secured Loan

15,000

Cash in Hand

1,930

Closing Stock

20,600

Debtors

44,000

Less: Provision for DD

2,200

Less: Provision for Discount

1,045

40,755

Furniture

3,350

Prepaid Insurance

120

Security Deposit

400

Bank

6,580

1,87,535

1,87,535

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Similar questions

Q. From the following Trial Balance and other information prepare Trading and Profit and Loss Account for the year ended 31st March 2016 and Balance Sheet as at that date.

Heads of Accounts	Debit (₹)	Credit (₹)
Sundry Debtors	32,000
Stock (1st April 2015)	22,000
Cash in hand	35
Cash at bank	1,545
Plant and Machinery	17,500
Sundry Creditors		10,650
Trade Expenses	1,075
Sales		1,34,500
Salaries	2,225
Carriage Outwards	400
Rent	900
Bills Payable		7,500
Purchases	1,18,870
Discounts	1,100
Premises	34,500
Capital (1st April 2015)		79,500
Total	2,32,150	2,32,150
Total

Additional Information:
Stock on 31st March 2016 was ₹ 12,450. Rent was unpaid to the extent of ₹ 85 and ₹ 150 were outstanding for Trade Expenses. ₹ 400 are to be written off as bad debts out of the above debtors, and 5% is to be provided for doubtful debts. Depreciate plant and machinery 10% and premises by 2%. Manager is entitled a commission of 5% on net profit after charging his commission.

Q. 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.

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 Amount Rs	Credit Amount 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.

Q. 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.

Q. 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:


Heads of Accounts	Dr. (₹)	Cr. (₹)
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 @ 2

\frac{1}{2}

%, 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.

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Particulars	Debit (₹)	Credit (₹)
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
Total

Trading Account for the year ended March 31, 2016
Dr.			Cr.
Particulars	Amount (₹)	Particulars	Amount (₹)
Opening Stock	8,000	Sales	2,20,000
Purchases	1,26,000	Closing Stock	20,600
Stores Consumed	6,050
Productive Wages	56,500
Carriage	3,050
Gross Profit	41,000
	2,40,600		2,40,600

Profit & Loss Account for the year ended March 31, 2016
Dr.				Cr.
Particulars		Amount (₹)	Particulars	Amount (₹)
Salaries		16,000	Gross Profit	41,000
Rent & Rates	5,200
Less: Security Deposit	(400)	4,800
Insurance	1,320
Less: Prepaid	120	1,200
General Expenses		2,600
Bad Debts	1,020
Add: Provision for DD	2,200	3,220
Provision for Discount on Debtors		1,045
Depreciation on Machinery		5,200
Net Profit		6,935
		41,000		41,000

Balance Sheet as on March 31, 2016
Dr.						Cr.
Liabilities		Amount (₹)	Assets			Amount (₹)
Creditors		20,000	Machinery		52,000
Capital	1,45,600		Less: Depreciation		5,200	46,800
Add: Net Profit	6,935	1,52,535	Building			67,000
Secured Loan		15,000	Cash in Hand			1,930
			Closing Stock			20,600
			Debtors	44,000
			Less: Provision for DD	2,200
			Less: Provision for Discount	1,045		40,755
			Furniture			3,350
			Prepaid Insurance			120
			Security Deposit			400
			Bank			6,580
		1,87,535				1,87,535