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Standard XI

Accountancy

AE for Liability

Monika has th...

Question

Monika has the following assets and liabilities as on 31st March, 2016. Ascertain her capital. Cash Rs. 50,000, bank Rs. 95,000, debtors Rs. 36,000, plant and machinery Rs. 1,60,000, building Rs. 4,00,000, furniture Rs. 48,000, creditors Rs. 44,000, bills receivable Rs. 1,13,000 and bills payable Rs. 47,000.

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Solution

Assets = Liabilities + Capital
Capital = Assets - Liabilities
Capital = (Cash + Bank + Debtors + Plant and Machinery + building + Furniture+ Bills Receivable) - (Creditors + Bills Payable)
= (50,000 + 95,000 + 36,000 + 1,60,000+ 4,00,000+48,000 +1,13,00) - (44,000 + 47,000)
= 9,02,000- 91,000 = Rs. 8,11,000.
Monika's Capital = Rs. 8,11,000

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PRACTICAL PROBLEMS

Asha and Usha were partners sharing profits and losses in the ratio of 2:1. Prepare their statement Profit or Loss for the year ended 31^st March, 2012 from the following statement of Affairs as on 31^st March, 2011.

Liabilities	Amount Rs	Assets	Amount Rs
Creditors	33,000	Cash at Bank	6,000
Bills Payable	9,000	Cash in Hand	2,000
Capitals:	62,000	Building	41,000
Asha	32,000	Machinery	21,000
Usha		Furniture	10,000
		Stock	18,000
		Debtors	25,000
		Bills Receivable	13,000
	1,36,000		1,36,000

The assets and liabilities as on 31^st March 2012 were:

Sundry creditors Rs 35,000 Bill Receivable Rs 18,000 Bills payable Rs 15,000 cash in hand Rs 3,000, Stock Rs 32,000 Cash of bank Rs 6,000 Debtors Rs 38,000. There were no changes in fixed assets.

Further Information:

1) Asha and Usha had drawn Rs 10,000 and Rs 8,000 respectively for personal use.

2) They also brought additional capital of Rs 6,000 and Rs 4,000 respectively.

3) Building to be depreciated by 5% and machinery and furniture at 10%.

4) Charge interest at 10% p.a. on opening capitals and allow interest on drawings of Asha and Usha were Rs 700 and Rs 500 respectively.

PRACTICAL PROBLEMS

A and B are in Partnership. Their Capitals on 1^st April 2010 were Rs 30,000 each. The assets and liabilities as on 31^st March 2011 were as follows. Cash in hand Rs 2,400, Cash at Bank Rs 16,000 Bill Receivable Rs 4,000, Debtors Rs 28,600 Stock Rs 26,000. Machinery Rs 14,000, furniture Rs 8,000, Bills Payable Rs 3,000 Sundry creditors Rs 6,000 Outstanding salary Rs 800.

Additional Information:

1) Provide Rs 600 as Bad Debts and 5% R.D.D.

2) Depreciate furniture @ 5% p.a. and Machinery @ 10% p.a.

3) Stock is found undervalued by Rs 2,000.

4) Sundry creditors are found overvalued by Rs 1,000.

5) Prepaid Insurance Rs 2,000.

6) Additional capital introduced by partners Rs 4,000 each.

7) Drawings of ‘A’ Rs 3,000 and ‘B’ Rs 2,000 calculate the profit for the year ended 31^st March 2011.

Ajay started business with a capital of Rs 2,25,000 on 1st April, 2011.During the year, he withdrew Rs 40,000 for his personal use and introduced Rs 7,000 as fresh capital. On 31st March 2012,his position of assets and liabilities stood as follows:

Cash in hand 18,500 Rs

Stock 20,000 Rs

Bills receivable 25,000 Rs

Debtors 4,00,000 Rs

Creditors 1,50,000 Rs

Bills Payable 3,000 Rs

You are required to prepare Statement of Profit or Loss for the year ended 31st March, 2012.

From the following information prepare the balance sheet of Jam Ltd. as per the (revised) Schedule VI:

Inventories Rs. 7,00,000; Equity Share Capital Rs. 16,00,000; Plant and Machinery Rs. 8,00,000; Preference Share Capital Rs. 6,00,000; General Reserves Rs. 6,00,000; Bills payable Rs. 1,50,000; Provision for taxation Rs. 2,50,000; Land and Building Rs. 16,00,000; Noncurrent Investments Rs. 10,00,000; Cash at Bank Rs. 5,00,000;Creditors Rs. 2,00,000; 12% Debentures Rs. 12,00,000.

Ram, Kishan and Gopal were partners sharing profits in the ratio of 4 : 2 : 1 respectively.

Following was their Balance Sheet as on 31st March 2013.

BALANCE SHEET
as on 31st March 2013
$\begin{matrix} Liabilities & Amount & Assets & Amount (Rs) & (Rs) Capitals : & Cash & 14, 000 Ram & 60, 000 & Stock & 30, 000 Kishan & 40, 000 & Debtors & 22, 000 Gopal & 30, 000 & Building & 40, 000 Creditors & 30, 000 & Plant & 53, 000 Bills Payable & 4, 000 & Motor Van & 26, 000 General Reserve & 21, 000 ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 1, 85, 000 & ¯ ¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯ ¯ 1, 85, 000 \end{matrix}$

On the above date, Ram retired and following adjustments were agreed:

(i) The assets and liabilities were valued as : Stock Rs 24,000, Debtors Rs 21,000, Building Rs 45,200, Plant Rs 50,000 and Creditors Rs 28,000.

(ii) Amount due to Ram will be transferred to Ram's loan account.

Prepare Revaluation Account and Ram's Capital Account.

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