Question

From the following information relating to the business of Mr. X who keeps books on Single Entry System, ascertaint the profit or loss for the year 2017–18:

Particulars		1st April, 2017 (₹)	31st March, 2018 (₹)
Machinery	................................................................................	8,000	8,000
Furniture	................................................................................	2,000	2,000
Stock	................................................................................	7,000	5,000
Sundry Debtors	................................................................................	4,000	4,500
Bank Balance	................................................................................	200 (Cr.)	1,800 (Dr.)
Sundry Creditors	................................................................................	5,000	3,500

Mr. X withdrew ₹ 4,100 during the year to meet his household expenses. He introduced ₹ 300 as fresh capital on 15th January, 2018. Machinery and Furniture are to be depreciated at 10% and 5% p.a. respectively.

Answer 1

Statement of Affairs as on April 01, 2017
Liabilities	Amount (₹)	Assets	Amount (₹)
Bank Overdraft	200	Machinery	8,000
Sundry Creditors	5,000	Furniture	2,000
Capital (Balancing Figure)	15,800	Stock	7,000
		Sundry Debtors	4,000
	21,000		21,000

Statement of Affairs as on March 31, 2018
Liabilities	Amount (₹)	Assets		Amount (₹)
Sundry Creditors	3,500	Machinery	8,000
Capital (Balancing Figure)	16,900	Less: 10% Depreciation	(800)	7,200
		Furniture	2,000
		Less: 5% Depreciation	(100)	1,900
		Stock		5,000
		Sundry Debtors		4,500
		Bank Balance		1,800
	20,400			20,400

Statement of Profit or Loss for the year ended March 31, 2018
Particulars	Amount (₹)
Capital as on March 31, 2017	16,900
Add: Drawings	4,100
	21,000
Less: Additional Capital Introduced	(300)
Adjusted Capital as on March 31, 2017	20,700
Less: Capital as on April 01, 2016	(15,800)
Profit made during the year 2016-17	4,900