Prepare the trading and profit and loss account and balance sheet of M/s Control Device India on March 31, 2017 from the following balance as on that date.

Account Title

Debit

Amount

Rs

Credit

Amount

Rs

Drawings and Capital

19,530

67,500

Purchase and Sales

45,000

1,12,500

Salary and Commission

25,470

1,575

Carriage

2,700

Plant and Machinery

27,000

Furniture

6,750

Opening stock

42,300

Insurance premium

2,700

Interest

7,425

Bank overdraft

24,660

Rent and Taxes

2,160

Wages

11,215

Returns

2,385

1,440

Carriage outwards

1,485

Debtors and Creditors

36,000

58,500

General expenses

6,975

Octroi

530

Investment

41,400

2,73,600

2,73,600

Closing stock was valued Rs 20,000.

(a) Interest on capital @ 10%.

(b) Interest on drawings @ 5%.

(c) Wages outstanding Rs 50.

(d) Outstanding salary Rs 20.

(e) Provide a depreciation @ 5% on plant and machinery.

(f) Make a 5% provision on debtors.

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Solution

Trading Account

Dr.

Cr.

Particulars

Amount

Rs

Particulars

Amount

Rs

Opening Stock

42,300

Sales

1,12,500

Purchases

45,000

Less: Sales Return

2,385

1,10,115

Less: Purchases Return

1,440

43,560

Closing Stock

20,000

Carriage

2,700

Wages

11,215

Add: Outstanding Wages

50

11,265

Octroi

530

Gross Profit

29,760

1,30,115

1,30,115

Profit and Loss Account

Dr.

Cr.

Particulars

Amount

Rs

Particulars

Amount

Rs

Salary

25,470

Gross Profit

29,760

Add: Outstanding Salary

20

25,490

Commission

1,575

Insurance Premium

2,700

Interest

7,425

Rent and Taxes

2,160

Interest on Drawings

977

Carriage Outwards

1,485

Net Loss

8,973

General Expenses

6,975

Interest on Capital

6,750

Depreciation on P & M

1,350

Provision on Debtors

1,800

48,710

48,710

Balance Sheet

Liabilities

Amount

Rs

Assets

Amount

Rs

Capital

67,500

Plant and Machinery

27,000

Add: Interest on Capital

6,750

Less: Depreciation

1,350

25,650

Less: Net Loss

8,973

Furniture

6,750

Less: Drawings

19,530

Debtors

36,000

Less: Interest on Drawings

977

44,770

Less: New Provision

1,800

34,200

Bank Overdraft

24,660

Investment

41,400

Creditors

58,500

Closing Stock

20,000

Outstanding Wages

50

Salary Outstanding

20

1,28,000

1,28,000

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Similar questions

From the following balances of M/s Jyoti Exports, prepare trading and profit and loss account for the year ended March 31, 2017 and balance sheet as on this date.

Account Title	Debit Amount Rs	Account Title	Credit Amount Rs
Sundry debtors	9,600	Sundry creditors	2,500
Opening stock	22,800	Sales	72,670
Purchases	34,800	Purchases returns	2,430
Carriage inwards	450	Bills payable	15,600
Wages	1,770	Capital	42,000
Office rent	820
Insurance	1,440
Factory rent	390
Cleaning charges	940
Salary	1,590
Building	24,000
Plant and Machinery	3,600
Cash in hand	2,160
Gas and Water	240
Octroi	60
Furniture	20,540
Patents	10,000
	1,35,200		1,35,200

Closing stock Rs 10,000.

1. To provision for doubtful debts is to be maintained at 5 per cent on sundry debtors.

2. Wages amounting to Rs 500 and salary amounting to Rs 350 are outstanding.

3. Factory rent prepaid Rs 100.

4. Depreciation charged on Plant and Machinery @ 5% and Building @ 10%.

5. Outstanding insurance Rs 100.

From the following balances extracted from the book of M/s Manju Chawla on March 31, 2017. You are requested to prepare the trading and profit and loss account and a balance sheet as on this date.

Account Title	Amount Rs	Amount Rs
Opening stock	10,000
Purchases and Sales	40,000	80,000
Returns	200	600
Wages	6,000
Dock and cleaning charges	4,000
Lighting	500
Misc. Income		6,000
Rent		2,000
Capital		40,000
Drawings	2,000
Debtors and Creditors	6,000	7,000
Cash	3,000
Investment	6,000
Patent	4,000
Land and Machinery	43,000
Donations and Charity	600
Sales tax collected		1,000
Furniture	11,300
	1,36,600	1,36,600

Closing stock was Rs 2,000.

(a) Interest on drawings @ 7% and interest on capital @ 5%.

(b) Land and Machinery is depreciated at 5%.

(d) Unexpired rent Rs 100.

(e) Charge 5% depreciation on furniture.

The following balances have been extracted from the books of M/s Green House for the year ended March 31, 2017, prepare trading and profit and loss account and balance sheet as on this date.

Account Title	Amount Rs	Account Title	Amount Rs
Purchases	80,000	Capital	2,10,000
Bank balance	11,000	Bills payable	6,500
Wages	34,000	Sales	2,00,000
Debtors	70,300	Creditors	50,000
Cash in hand	1,200	Return outwards	4,000
Legal expenses	4,000
Building	60,000
Machinery	120,000
Bills receivable	7,000
Office expenses	3,000
Opening stock	45,000
Gas and fuel	2,700
Freight and Carriage	3,500
Factory lighting	5,000
Office furniture	5,000
Patent right	18,800
	4,70,500		4,70,500

adjustments :

(a) Machinery is depreciated at 10% and buildings depreciated at 6%.

(b) Interest on capital @ 4%.

(d) Closing stock Rs 50,000.

Q. From the following balances, prepare Trading and Profit and Loss Account and Balance Sheet:

Debit Balances:	₹	Debit Balances (Contd.):	₹
Machinery	3,50,000	Rent	45,000
Debtors	2,70,000	Sundry Expenses	20,000
Drawings	90,000	Carriage	15,000
Purchases	9,50,000	Credit Balances:
Wages	5,00,000	Capital	10,00,000
Bank	1,50,000	Creditors	1,40,000
Opening Stock	2,00,000	Sales	14,50,000

Closing Stock was valued at ₹ 30,000.

Prepare trading and profit and loss account and balance sheet of M/s Royal Traders from the following balances as on March 31, 2017.

Debit balances	Amount Rs	Credit balances	Amount Rs
Stock	20,000	Sales	2,45,000
Cash	5,000	Creditors	10,000
Bank	10,000	Bills payable	4,000
Carriage on purchases	1,500	Capital	2,00,000
Purchases	1,90,000
Drawings	9,000
Wages	55,000
Machinery	1,00,000
Debtors	27,000
Postage	300
Sundry expenses	1,700
Rent	4,500
Furniture	35,000

Closing stock Rs 8,000.

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Trading Account
Dr.							Cr.
Particulars			Amount Rs	Particulars			Amount Rs
Opening Stock			42,300	Sales		1,12,500
Purchases		45,000			Less: Sales Return	2,385	1,10,115
	Less: Purchases Return	1,440	43,560	Closing Stock			20,000
Carriage			2,700
Wages		11,215
	Add: Outstanding Wages	50	11,265
Octroi			530
Gross Profit			29,760
			1,30,115				1,30,115

Profit and Loss Account
Dr.					Cr.
Particulars			Amount Rs	Particulars	Amount Rs
Salary		25,470		Gross Profit	29,760
	Add: Outstanding Salary	20	25,490	Commission	1,575
Insurance Premium			2,700	Interest	7,425
Rent and Taxes			2,160	Interest on Drawings	977
Carriage Outwards			1,485	Net Loss	8,973
General Expenses			6,975
Interest on Capital			6,750
Depreciation on P & M			1,350
Provision on Debtors			1,800

			48,710		48,710

Balance Sheet
Liabilities			Amount Rs	Assets			Amount Rs
Capital		67,500		Plant and Machinery		27,000
	Add: Interest on Capital	6,750			Less: Depreciation	1,350	25,650
	Less: Net Loss	8,973		Furniture			6,750
	Less: Drawings	19,530		Debtors		36,000
	Less: Interest on Drawings	977	44,770		Less: New Provision	1,800	34,200
Bank Overdraft			24,660	Investment			41,400
Creditors			58,500	Closing Stock			20,000
Outstanding Wages			50
Salary Outstanding			20

			1,28,000				1,28,000