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

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.

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Solution

Trading Account

for the year ended March 31, 2016

Dr.

Cr.

Particulars

Amount

(₹)

Particulars

Amount

(₹)

Opening Stock

22,000

Sales

1,34,500

Purchases

1,18,870

Closing Stock

12,450

Gross Profit

6,080

1,46,950

1,46,950

Profit & Loss Account

for the year ended March 31, 2016

Dr.

Cr.

Particulars

Amount

(₹)

Particulars

Amount

(₹)

Salaries

2,225

Gross Profit

6,080

Trade Expenses

1,075

Net Loss

4,275

Add: Outstanding

150

1,225

Rent

900

Add: Outstanding

85

985

Carriage Outwards

400

Bad Debts

400

Add: Provision for DD

1,580

1,980

Discount

1,100

Depreciation on Machinery

1,750

Depreciation on Premises

690

10,355

10,355

Balance Sheet

as on March 31, 2016

Dr.

Cr.

Liabilities

Amount

(₹)

Assets

Amount

(₹)

Sundry Creditors

10,650

Plant &Machinery

17,500

Capital

79,500

Less: Depreciation

1,750

15,750

Less: Net Loss

4,275

75,225

Cash in Hand

35

Bills Payable

7,500

Closing Stock

12,450

Rent Outstanding

85

Premises

34,500

Trade Expenses Outstanding

150

Less: Depreciation

690

33,810

Debtors

32,000

Less: Further Bad Debts

400

Less: Provision for DD

1,580

30,020

Cash at Bank

1,545

93,610

93,610

Suggest Corrections

Similar questions

Q. From the following Trial Balance and additional information of Mr. Gaurav, a proprietor, prepare Trading and Profit and Loss Account for the year ended 31st March, 2019 and Balance Sheet as at that date:

Particulars		Dr. Balance (₹)	Cr. Balance (₹)
Building		1,60,000	…
Wages		26,000	…
Machinery		16,000	…
Salaries and Wages		41,600	…
Debtors		38,700	…
Capital		…	2,23,100
Purchases		56,500	…
Sales		…	1,00,700
Creditors		…	12,500
Income Tax		2,000	…
Drawings		500	…
Input CGST A/c		10,000	…
Input SGST A/c		10,000	…
Output CGST A/c		…	12,500
Output SGST A/c		…	12,500
	Total	3,61,300	3,61,300

Closing Stock at cost ₹ 1,00,000 but its market value is ₹ 88,500.

Q. From the following Trial Balance and additional information of Mr. Gaurav, a proprietor, prepare Trading and Profit and Loss Account for the year ended 31st March, 2018 and Balance Seet as at that date:

Particular		Dr. Balance (₹)	Cr. Balance (₹)
Building		1,60,000	…
Wages		26,000	…
Machinery		16,000	…
Salaries and Wages		41,600	…
Debtors		38,700	…
Capital		…	2,23,100
Purchases		56,500	…
Sales		…	1,00,700
Creditors		…	12,500
Income Tax		2,000	…
Drawings		500	…
Input CGST A/c		10,000	…
Input SGST A/c		10,000	…
Output CGST A/c		…	12,500
Output SGST A/c		…	12,500
	Total	3,61,300	3,61,300

Closing Stock at cost ₹ 1,00,000 but its market value is ₹ 88,500.

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.

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. 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:

Particulars		Dr. (₹)	Cr. (₹)
Capital	................................................................................	…	1,00,000
Cash	................................................................................	15,000	…
Bank Loan	................................................................................	…	20,000
Purchases	................................................................................	1,20,000	…
Sales	................................................................................	…	1,50,000
Sales Return	................................................................................	10,000	…
Purchases Return	................................................................................	…	20,000
Establishment Expenses	................................................................................	22,000	…
Taxes and Insurance	................................................................................	5,000	...
Bad Debts	................................................................................	5,000	…
Provision for Doubtful Debts	................................................................................	…	7,000
Debtors	................................................................................	50,000	…
Creditors	................................................................................	…	20,000
Commission	................................................................................	…	5,000
Deposits	................................................................................	40,000	…
Opening Stock	................................................................................	30,000	…
Drawings	................................................................................	14,000	…
Furniture	................................................................................	6,000	…
Bills Receivable	................................................................................	32,000	…
Bills Payable	................................................................................	…	25,000
Input CGST	................................................................................	10,000	...
Input SGST	................................................................................	10,000	…
Output CGST	................................................................................	…	8,000
Output SGST	................................................................................	…	8,000
Output IGST	................................................................................	…	6,000
Total		3,69,000	3,69,000

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.

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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

Trading Account for the year ended March 31, 2016
Dr.			Cr.
Particulars	Amount (₹)	Particulars	Amount (₹)
Opening Stock	22,000	Sales	1,34,500
Purchases	1,18,870	Closing Stock	12,450
Gross Profit	6,080
	1,46,950		1,46,950

Profit & Loss Account for the year ended March 31, 2016
Dr.				Cr.
Particulars		Amount (₹)	Particulars	Amount (₹)
Salaries		2,225	Gross Profit	6,080
Trade Expenses	1,075		Net Loss	4,275
Add: Outstanding	150	1,225
Rent	900
Add: Outstanding	85	985
Carriage Outwards		400
Bad Debts	400
Add: Provision for DD	1,580	1,980
Discount		1,100
Depreciation on Machinery		1,750
Depreciation on Premises		690
		10,355		10,355

Balance Sheet as on March 31, 2016
Dr.						Cr.
Liabilities		Amount (₹)	Assets			Amount (₹)
Sundry Creditors		10,650	Plant &Machinery		17,500
Capital	79,500		Less: Depreciation		1,750	15,750
Less: Net Loss	4,275	75,225	Cash in Hand			35
Bills Payable		7,500	Closing Stock			12,450
Rent Outstanding		85	Premises		34,500
Trade Expenses Outstanding		150	Less: Depreciation		690	33,810
			Debtors	32,000
			Less: Further Bad Debts	400
			Less: Provision for DD	1,580		30,020
			Cash at Bank			1,545
		93,610				93,610