Prepare trading account and profit and loss account from the following particulars for the year ended 31st December, 2015.
(i) Bad Debts Rs. 2,000.
(ii) Provision for doubtful debts is to be maintained at 5% on sundry debtors.
(iii) Provision for 2% discount on debtors and creditors.
(iv) Manager is entitled to get the commission at 10% on net profit after changing such commission.
(v) Closing stock was valued at Rs. 60,000.
(vi) Allow interest on capital @ 10%.
(vii) Charge Rs. 1,000 as interest on drawings.
Trading and Profit and Loss Account
Dr. for the year ended 31st December, 2015 Cr.
(−) Already Paid=1,400 Outstanding=¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯¯Rs. 600–––––––––