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Question

Prepare Trading and Profit and Loss Account and Balance Sheet of Jagat Shah as at 31st March, 2018 from the following balances:
Capital (Cr.)
3,60,000
Salaries
60,000
Machinery
70,000
General Expenses
20,000
Sales 8,20,000 Rent 50,000
Purchases 4,00,000 Purchases Return 5,000
Sales Return 10,000 Debtors 3,00,000
Stock on 1st April, 2017 1,00,000 Cash 40,000
Drawing 40,000 Carriage Outwards 20,000
Wages 1,00,000 Advertising 20,000
Carriage Inwards
5,000
Creditros 50,000

The Closing Stock was valued at ₹ 2,00,000.

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Solution

Financial Statements of Jagat Shah

Trading Account

for the year ended March 31, 2018

Dr.

Cr.

Particulars

Amount

(Rs)

Particulars

Amount

(Rs)

Opening Stock

1,00,000

Sales

8,20,000

Purchases

4,00,000

Less: Sales Return

(10,000)

8,10,000

Less: Purchases Return

(5,000)

3,95,000

Closing Stock

2,00,000

Wages

1,00,000

Carriage Inwards

5,000

Gross Profit (Balancing Figure)

4,10,000

10,10,000

10,10,000

Profit and Loss Account
for the year ended March 31, 2018

Dr.

Cr.

Particulars

Amount

(Rs)

Particulars

Amount

(Rs)

Salaries

60,000

Gross Profit

4,10,000

General Expenses

20,000

Rent

50,000

Carriage Outwards

20,000

Advertising

20,000

Net Profit (Balancing Figure)

2,40,000

4,10,000

4,10,000

Balance Sheet
as on March 31, 2018

Liabilities

Amount

(Rs)

Assets

Amount

(Rs)

Capital

3,60,000

Fixed Assets

Less: Drawings

(40,000)

Machinery

70,000

Add: Net Profit

2,40,000

5,60,000

Current Assets

Current Liabilities

Closing Stock

2,00,000

Creditors

50,000

Debtors

3,00,000

Cash

40,000

6,10,000

6,10,000


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Q. ​On 31st March, 2018 the following Trial Balance was extracted from the books of Mohan:

Particulars Debit Balances
(₹)
Credit Balances
(₹)
Capital 3,00,000
Plant and Machinery 50,000
Debtors 2,00,000
Creditors 1,00,000
Loan 95,000
Interest on Loan 3,000
Cash 20,000
Provision for Doubtful Debts 7,000
Stock on 1st April, 2017 68,000
Motor Vehicles 1,00,000
Bank 35,000
Land and Building 1,20,000
Bad Debts 5,000
Purchases 6,60,000
Sales 11,00,000
Purchases Return 15,000
Sales Return 80,000
Carriage Outwards 25,000
Carriage Inwards 30,000
Salaries 90,000
Rent and Insurance 30,000
Advertising 35,000
Discount Received 5,000
General Expenses 34,000
Bills Receivable 60,000
Bills Payable 20,000
Rent Received 3,000
Total 16,45,000 16,45,000
Prepare Trading and Profit and Loss Account for the year ended 31st March, 2018 and Balance Sheet as at that date after taking into account the following:
(a) Stock as at 31st March, 2018 was valued at ₹70,000.
(b) All debtors are considered good for recovery.
(c) Depreciate Motor Vehicles by 20%.
(d) Bank intimation of customer's cheque of ₹10,000 being dishonoured is not recorded in the books.
(e) Travelling expenses of ₹5,000 paid to sales person was wrongly debited to his Personal Account and was included in debtors.
(f) Amount of ₹6,000 received from Ronit was credited to his account and was included in creditors. This amount was written off as bad debt in earlier years.

(g) Drawings included an amount of ₹2,000 being amount drawn in cash. It was used by Mohan for Purchase of stationery used in business.
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