Question

Kuldeep, a general merchant, keeps his accounts on Single Entry System. He wants to know the results of his business on 31st March, 2019 and for that following information is available:

		1st April, 2018 (₹)	31st March, 2019 (₹)
Cash in Hand		1,50,000	1,75,000
Bank Balance		7,50,000	8,00,000
Furniture		1,00,000	1,00,000
Stock		5,00,000	6,50,000
Creditors		3,50,000	4,00,000
Debtors		2,50,000	3,00,000

During the year, he had withdrawn ₹ 5,00,000 for his personal use and invested ₹ 2,50,000 as additional capital. Calculate his profits on 31st March, 2019 and prepare the Statement of Affairs as on that date.

Answer 1

Statement of Affairs as on April 01, 2018
Liabilities	Amount ₹	Assets	Amount ₹
Creditors	3,50,000	Cash in Hand	1,50,000
Capital (Balancing Figure)	14,00,000	Bank Balance	7,50,000
		Furniture	1,00,000
		Stock	5,00,000
		Debtors	2,50,000
	17,50,000		17,50,000

Statement of Affairs as on March 31, 2019
Liabilities	Amount ₹	Assets	Amount ₹
Creditors	4,00,000	Cash in Hand	1,75,000
Capital (Balancing Figure)	16,25,000	Bank Balance	8,00,000
		Furniture	1,00,000
		Stock	6,50,000
		Debtors	3,00,000
	20,25,000		20,25,000

Statement of Profit or Loss for the year ended March 31, 2019
Particulars	Amount ₹
Capital as on March 31, 2019	16,25,000
Add: Drawings	5,00,000
	21,25,000
Less: Additional Capital Introduced	(2,50,000)
Adjusted Capital as on March 31, 2019	18,75,000
Less: Capital as on April 01, 2018	(14,00,000)
Profit made during the year 2018-19	4,75,000