Krishan started his business on 1st April, 2017 with a Capital of ₹ 1,00,000. On 31st March, 2018, his assets were :

₹

Cash 3,200

Stock 34,800

Debtors 31,000

Plant 85,000

He owed ₹ 12,000 to sundry creditors and ₹ 10,000 to his brother on that date. He withdrew ₹ 2,000 per month for the private expenses. Ascertain his profit.

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Solution

Statement of Affairs

as on March 31, 2018

Liabilities

Amount

(Rs)

Assets

Amount

(Rs)

Sundry Creditors

12,000

Cash

3,200

Brother’s Loan

10,000

Stock

34,800

Capital (Balancing Figure)

1,32,000

Debtors

31,000

Plant

85,000

1,54,000

1,54,000

Statement of Profit or Loss

for the year end March 31, 2018

Particulars

Amount

(Rs)

Capital as on March 31, 2018

1,32,000

Add: Drawings (Rs 2,000 × 12)

24,000

1,56,000

Less: Capital as on April 01, 2017

(1,00,000)

Profit made during the year 2017-2018

56,000

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	₹
Cash	3,200
Stock	34,800
Debtors	31,000
Plant	85,000

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Statement of Affairs as on March 31, 2018
Liabilities	Amount (Rs)	Assets	Amount (Rs)
Sundry Creditors	12,000	Cash	3,200
Brother’s Loan	10,000	Stock	34,800
Capital (Balancing Figure)	1,32,000	Debtors	31,000
		Plant	85,000

	1,54,000		1,54,000

Statement of Profit or Loss for the year end March 31, 2018
Particulars	Amount (Rs)
Capital as on March 31, 2018	1,32,000
Add: Drawings (Rs 2,000 × 12)	24,000
	1,56,000
Less: Capital as on April 01, 2017	(1,00,000)
Profit made during the year 2017-2018	56,000