Question

From the following Trial Balance of Shubdo Banerjee, prepare final accounts for the year ended in 31st March, 2018 and Balance Sheet as at that date:

Particulars	Dr. Balances (₹)	Cr. Balances (₹)
Land and Building	50,000
Purchases (Adjusted)	2,10,000
Stock (31st March, 2018)	45,000
Returns Inward	1,500
Returns Outward		2,500
Wages	45,300
Salaries	39,000
Office Expenses	15,400
Carriage Inwards	1,200
Carriage Outwards	2,000
Discount allowed	750
Discount received		1,200
Bad Debts	1,200
Sales		3,85,000
Capital Account		1,15,000
Chatterji's Loan A/c (taken on 1st Oct., 2017 @ 18% p.a.		25,000
Insurance	1,500
Commission		1,500
Plant and Machinery	50,000
Furniture and Fixtures	20,000
Bills Receivable	20,000
Sundry Debtors	40,000
Sundry Creditors		25,000
Cash at Bank	16,000
Office Equipments	12,000
Bills Payable		12,350
Expenses Payable		3,300
Total	5,70,850	5,70,850
	​

The following adjustments be taken care of:
(i) Depreciate Land and Building @ 6%, Plant and Machinery @ 10%, Office equipments @ 20% and Furniture and Fixtures @ 15%
(ii) Calculate Provision for Doubtful Debts at 2% on Debtors.
(iii) Insurance premium includes ₹250 paid in advance.
(iv) Provide salary to Banerjee ₹15,000 p.a.
(v) Outstanding Salaries ₹11,500.
(vi) 10% of the final profit is to be transferred to General Reserve.

Answer 1

Trading Account for the year ended March 31, 2018
Dr.					Cr.
Particulars		Amount (₹)	Particulars		Amount (₹)
Purchases (Adjusted)	2,10,000		Sales	3,85,000
Less: Returns	2,500	2,07,500	Less: Returns	1,500	3,83,500
Carriage Inwards		1,200
Wages		45,300
Gross Profit		1,29,500
		3,83,500			3,83,500

Profit & Loss Account for the year ended March 31, 2018
Dr.					Cr.
Particulars			Amount (₹)	Particulars	Amount (₹)
Carriage Outwards			2,000	Gross Profit	1,29,500
Salaries	39,000			Commission	1,500
Add: Outstanding	11,500			Discount	1,200
Add: Payable to Proprietor	15,000		65,500
Insurance Premium	1,500
Less: Prepaid	250		1,250
Discount			750
Office Expenses			15,400
Outstanding Interest on Loan			2,250
Bad Debts		1,200
Add: Provision for Doubtful Debts		800	2,000
Depreciation on:
Furniture & Fixtures		3,000
Land & Building		3,000
Office Equipment		2,400
Plant & Machinery		5,000	13,400
General Reserve			2,965
Net Profit			26,685
			1,32,200		1,32,200

Balance Sheet as on March 31, 2018
Dr.					Cr.
Liabilities		Amount (₹)	Assets		Amount (₹)
Bills Payable		12,350	Furniture & Fixtures	20,000
Creditors		25,000	Less: Depreciation	3,000	17,000
Expenses Payable		3,300	Land & Building	50,000
Capital	1,15,000		Less: Depreciation	3,000	47,000
Add: Salary Payable	15,000		Debtors	40,000
Add: Net Profit	26,685	1,56,685	Less: Provision	800	39,200
Chatterji’s Loan	25,000		Plant & Machinery	50,000
Add: Outstanding Interest	2,250	27,250	Less: Depreciation	5,000	45,000
General Reserve		2,965	Office Equipment	12,000
Outstanding Salaries		11,500	Less: Depreciation	2,400	9,600
			Bills Receivable		20,000
			Closing Stock		45,000
			Cash at Bank		16,000
			Prepaid Insurance		250
		2,39,050			2,39,050