Question

Prepare Trading Profit & Loss Account for the year ending 31st March, 2010 and Balance Sheet as on that date of M/s Sunit Kulkarni, Shahada from the following Trial Balance.

Trial Balance as on 31st March, 2010
Particulars	Debit Amount Rs	Credit Amount Rs
Opening Stock	25,000
Purchase and Sales	1,30,000	1,80,000
Returns	2,000	5,000
Sundry Debtors and Sundry Creditors	20,000	25,000
Wages	4,000
Furniture	11,000
Machinery	30,000
Advertisement (for 2 years)	4,000
Salaries	8,000
Investment	6,000
Insurance	500
Cash in hand	900
Cash at Bank	8,000
Postage and Telegram	1,000
Commission		500
Reserve Fund		4,000
Bills Payable		6,000
R.D.D.		500
Capital		31,000
Drawings	1,600
Total	2,52,000	2,52,000

Adjustment:

1) Closing stock was valued at Rs 23,000.

2) Depreciate Furniture by 20% and Machinery by 10% p.a.

3) Wages Rs 500 were unpaid and Insurance prepaid Rs 300,

4) Create R.D.D. at 5% on debtors.

5) Goods of Rs 1,400 taken over by Sunit Kulkarni for his personal use.

6) Commission Rs 200 due but not received.

Answer 1

Financial Statement of M/s Sunit Kulkarni
Trading Account for the year ended 31st March, 2010
Dr.							Cr.
Particulars			Amount (Rs)	Particulars		Amount (Rs)
Opening Stock			25,000	Sales	1,80,000
Purchases		1,30,000		Less: Returns	(2,000)	1,78,000
Less:Drawings		(1,400)		Closing Stock		23,000
Less: Returns		(5,000)	1,23,600
Wages		4,000
Add: Outstanding		500	4,500
Gross Profit (Balancing Figure)			47,900
			2,01,000			2,01,000

Profit and Loss Account for the year ended March 31, 2010
Dr.							Cr.
Particulars			Amount (Rs)	Particulars		Amount (Rs)
Advertisement		4,000		Gross Profit		47,900
Less: Prepaid		(2,000)	2,000	Commission	500
Salaries			8,000	Add:Accrued	200	700
Insurance		500
Less: Prepaid		(300)	200
Postage & Telegram			1,000
Depreciation on:
Furniture		2,200
Machinery		3,000	5,200
New R.D.D		1,000
Less: Old R.D.D		(500)	500
Net Profit (Balancing Figure)			31,700
			48,600			48,600

Balance Sheet as on March 31, 2010
Liabilities		Amount (Rs)	Assets		Amount (Rs)
Capital	31,000		Fixed Assets
Less:Drawings	(3,000)		Furniture	11,000
Add: Net Profit	31,700	59,700	Less:Depreciation @ 20%	(2,200)	8,800
Reserve Fund		4,000	Machinery	30,000
			Less:Depreciation @ 10%	(3,000)	27,000
Current Liabilities			Investment		6,000
Outstanding Wages		500
Creditors		25,000	Current Assets
Bills Payable		6,000	Closing Stock		23,000
			Prepaid Advertisement		2,000
			Debtors	20,000
			Less:R.D.D	(1,000)	19,000
			Prepaid Insurance		300
			Cash in Hand		900
			Cash at Bank		8,000
			Accrued Commission		200
		95,200			95,200