Question

Prepare a trading and profit and loss account of M/s Green Club Ltd. for the year ending March 31, 2017. from the following figures taken from his trial balance :

Account Title	Amount Rs	Account Title	Amount Rs
Opening stock	35,000	Sales	2,50,000
Purchases	1,25,000	Purchase return	6,000
Return inwards	25,000	Creditors	10,000
Postage and Telegram	600	Bills payable	20,000
Salary	12,300	Discount	1,000
Wages	3,000	Provision for bad debts	4,500
Rent and Rates	1,000	Interest received	5,400
Packing and Transport	500	Capital	75,000
General expense	400
Insurance	4,000
Debtors	50,000
Cash in hand	20,000
Cash at bank	40,000
Machinery	20,000
Lighting and Heating	5,000
Discount	3,500
Bad debts	3,500
Investment	23,100
	3,71,900		3,71,900

Adjustments

1. Depreciation charged on machinery @ 5% p.a.

2. Further bad debts Rs 1,500, discount on debtors @ 5% and make a provision on debtors @ 6%.

3. Wages prepaid Rs 1,000.

4. Interest on investment @ 5% p.a.

5. Closing stock 10,000.

Answer 1

Trading Account for the year ending March 31, 2017
Dr.				Cr.
Particulars			Amount Rs	Particulars			Amount Rs
Opening Stock			35,000	Sales		2,50,000
Purchases		1,25,000			Less: Sales Returns	(25,000)	2,25,000
	Less: Purchase Returns	(6,000)	1,19,000	Closing Stock			10,000
Wages		3,000
	Less: Prepaid Wages	(1,000)	2,000
Gross Profit			79,000
			2,35,000				2,35,000

Profit and Loss Account for the year ending March 31, 2017
Dr.				Cr.
Particulars			Amount Rs	Particulars			Amount Rs
Bad Debts		3,500		Gross Profit			79,000
	Add: Further Bad-debts	1,500		Interest on Accrued Investment			1,155
	Add: New Provision	2,910		Discount			1,000
	Less: Old Provision	4,500	3,410	Interest Received			5,400
Discount on Debtors			2,280
Postage and Telegram			600
Salary			12,300
Rent and Rates			1,000
Packing and Transport			500
General Expenses			400
Insurance			4,000
Discount			3,500
Depreciation on Machinery			1,000
Lighting and Heating			5,000
Net Profit			52,565
			86,555				86,555

Balance Sheet as on March 31, 2017
Liabilities			Amount Rs	Assets			Amount Rs
Creditors			10,000	Cash in Hand			20,000
Bills Payable			20,000	Cash at Bank			40,000
Capital		75,000
	Add: Net Profit	52,565	1,27,565	Debtors		50,000
					Less: Further Bad-Debts	1,500
					Less New Provision	2,910
					Less: Discount on Debtors	2,280	43,310
				Investment		23,100
					Add: Interest on Investment	1,155	24,255
				Machinery		20,000
					Less: Depreciation	1,000	19,000
				Prepaid Wages			1,000
				Closing Stock			10,000
			1,57,565				1,57,565