Question

From the following Trial Balance, prepare Trading Account, Profit and Loss Account for the year ended 31^st March, 2018 and Balance Sheet as at the date:

Debit Balances	₹	Credit Balances	₹
Purchases	3,00,000	Sales	4,79,760
Drawings	3,500	Purchases Return	12,200
Plant and Machinery	1,23,000	Capital	5,90,000
Motor Vehicles	1,76,000	Creditors	11,870
Building	3,80,000	Bank Loan	33,700
Sundry Debtors	80,000
Stock in Trade (1.4.2017)	8,400
Sales Return	1,800
Wages	2,800
Carriage Inwards	890
Carriage Outwards	300
Telephone Charges	3,290
Salaries	12,000
Insurance and Taxes	31,200
Printing and Stationery Expenses	1,350
Cash in Hand	3,000
	11,27,530		11,27,530

Following adjustments are to be considered:
(i) Closing Stock ₹ 15,270.
(ii) Printing and Stationery expenses due ₹ 58,650.
(iii) Outstanding liabilities for salaries ₹ 12,000
(iv) An old machine value at ₹ 12,000 (Book Value of which was ₹ 2,000) was given in exchange for a new machine purchased on 1^st April, 2017. The machine given in exchange was not recorded in the books. Cheque issued for new machine purchased was accounted in the books of account.
(v) Depreciation @ 10% p.a. is to be provided on all fixed assets except building.

Answer 1

Trading Account for the year ended March 31, 2018
Dr.					Cr.
Particulars		Amount (Rs)	Particulars		Amount (Rs)
Opening Stock		8,400	Sales	4,79,760
Purchases	3,00,000		Less: Sales Return	(1,800)	4,77,960
Less: Purchases Return	(12,200)	2,87,800	Closing Stock		15,270
Wages		2,800
Carriage Inwards		890
Gross Profit (Balancing Figure)		1,93,340
		4,93,230			4,93,230

Profit and Loss Account for the year ended March 31, 2018
Dr.					Cr.
Particulars			Amount (Rs)	Particulars	Amount (Rs)
Carriage Outwards			300	Gross Profit	1,93,340
Telephone Charges			3,290	Profit on exchange of Machinery	10,000
Salaries		12,000
Add: Outstanding		12,000	24,000
Insurance and Taxes			31,200
Printing and Stationery
Expenses		1,350
Add: Outstanding		58,650	60,000
Depreciation on
Plant and Machinery		13,300
Motor Vehicles		17,600	30,900
Net Profit (Balancing Figure)			53,650
			2,03,340		2,03,340

Balance Sheet as on March 31, 2018
Liabilities		Amount (Rs)	Assets		Amount (Rs)
Capital	5,90,000		Fixed Assets
Less: Drawings	(3,500)		Plant and Machinery	1,33,000
Add: Net Profit	53,650	6,31,150	Less: 10% Depreciation	(13,300)	1,19,700
Bank Loan		33,700	Motor Vehicles	1,76,000
Current Liabilities			Less: 10% Depreciation	(17,600)	1,58,400
Creditors		11,870	Building		3,80,000
Outstanding Printing and Stationery		58,650	Current Assets
Outstanding Salaries		12,000	Sundry Debtors		80,000
			Closing Stock		15,270
			Cash in Hand		3,000
		7,56,370			7,56,370