Question

M/s Saniya Sports Equipment does not keep proper records. From the following information, find out profit or loss and also prepare balance sheet for the year ended 31st December, 2016.

$\begin{array}{ccc}\text{Items}& \text{31st December,}& \text{31st December,}\\ & \text{2015 (Rs.)}& \text{2016 (Rs.)}\\ \text{Cash in Hand}& 6,000& 24,000\\ \text{Bank Overdraft}& 30,000& -\\ \text{Stock}& 50,000& 80,000\\ \text{Sundry Creditors}& 26,000& 40,000\\ \text{Sundry Debtors}& 60,000& 1,40,000\\ \text{Bills Payable}& 6,000& 12,000\\ \text{Furniture}& 40,000& 60,000\\ \text{Bills Receivable}& 8,000& 28,000\\ \text{Machinery}& 50,000& 1,00,000\\ \text{Investment}& 30,000& 80,000\end{array}$

Drawings Rs. 10,000 per month for personal use, fresh capital introduced during the year Rs. 2,00,000. A bad debts Rs. 2,000 and a provision of $5\%$ it to be made on debtors. Outstanding salary Rs. 2,400, prepaid insurance Rs. 700, depreciation charged on furniture @ $10\%$ per annum.

Answer 1

$\text{Statement of Affairs}\text{as at 31st December, 2015}\begin{array}{cccc}\text{Capital and Liabilities}& \text{Amt. (Rs.)}& \text{Assets}& \text{Amt. (Rs.)}\\ \text{Bank Overdraft}& 30,000& \text{Cash in Hand}& 6,000\\ \text{Sundry Creditors}& 26,000& \text{Stock}& 50,000\\ \text{Bills Payable}& 6,000& \text{Sundry Debtors}& 60,000\\ \text{Capital(Balancing Figure)}& 1,82,000& \text{Furniture}& 40,000\\ & & \text{Bills Receivable}& 8,000\\ & & \text{Machinery}& 50,000\\ & & \text{Investment}& 30,000\\ & \overline{\underset{–}{\underset{–}{2,44,000}}}& & \overline{\underset{–}{\underset{–}{2,44,000}}}\end{array}$

$\text{Statement of Affairs}\text{as at 31st December, 2016}\begin{array}{ccccc}\text{Capital and Liabilities}& \text{Amt. (Rs.)}& \text{Assets}& & \text{Amt. (Rs.)}\\ \text{Sundry Creditors}& 40,000& \text{Cash in Hand}& & 24,000\\ \text{Bills Payable}& 12,000& \text{Stock}& & 80,000\\ \text{Outstanding Salary}& 2,400& \text{Debtors}& 1,40,000& \\ \text{Capital (Balancing Figure)}& 4,33,400& \text{(-)Bad Debts}& 2,000& \\ & & & \overline{1,38,000}& \\ & & \text{(-) Provision @}5\%& 6,900& 1,31,100\\ & & \text{Furniture}& \overline{60,000}& \\ & & \text{(-) Depreciation @}10\%& \underset{–}{6,000}& 54,000\\ & & \text{Bills Receivable}& & 28,000\\ & & \text{Machinery}& 1,00,000& \\ & & \text{(-) Depreciation @}10\%& \underset{–}{10,000}& 90,000\\ & & \text{Investment}& & 80,000\\ & & \text{Prepaid Insurance}& & 700\\ & \overline{\underset{–}{\underset{–}{4,87,800}}}& & & \overline{\underset{–}{\underset{–}{4,87,800}}}\end{array}$

$\text{Statement of Profit and Loss}\text{for the year ending 31st December, 2016}\begin{array}{cc}\text{Particulars}& \text{Amt (Rs.)}\\ \text{Capital at the End of the Year}& 4,33,400\\ \text{(+)Drawings During the Year}(10,000\times 12)& 1,20,000\\ & \overline{5,53,400}\\ \text{(-) Fresh Capital Introduced During 2016}& \underset{–}{2,00,000}\\ \text{Adjusted Capital in the End}& 3,53,400\\ \text{(-) Capital in the Beginning of the Year at 31st December ,2015}& \underset{–}{1,82,000}\\ \text{Profit for the Year}& \underset{–}{\underset{–}{1,71,400}}\end{array}$