Question

Ram Prashad keeps his books on Single Entry System and from them and the particulars supplied, the following figures were gathered together on 31st March, 2019:
Book Debts ₹ 10,000; Cash in Hand ₹ 510; Stock-in-Trade (estimated) ₹ 6,000; Furniture and Fittings ₹ 1,200; Trade Creditors ₹ 4,000; Bank Overdraft ₹ 1,000; Ram Prashad stated that he started business on 1st April, 2018 with cash ₹ 6000 paid into bank but stocks valued at ₹ 4,000. During the year he estimated his drawings to be ₹ 2,400. You are required to prepare the statement, showing the profit for the year, after writing off 10% for Depreciation on Furniture and Fittings.

Answer 1

Books of Ram Prashad Statement of Affairs as on March 31, 2019
Liabilities	Amount (₹)	Assets		Amount (₹)
Trade Creditors	4,000	Book Debts		10,000
Bank Overdraft	1,000	Cash in Hand		510
Capital (Balancing Figure)	12,590	Stock		6,000
		Furniture and Fittings	1,200
		Less: 10% Depreciation	120	1,080
	17,590			17,590

Statement of Affairs as on April 01, 2018
Liabilities	Amount (₹)	Assets	Amount (₹)
Capital (Balancing Figure)	10,000	Bank	6,000
		Stock	4,000
	10,000		10,000

Statement of Profit or Loss for the year and March 31, 2019
Particulars	Amount (₹)
Capital as on March 31, 2019	12,590
Add: Drawings	2,400
	14,990
Less: Capital as on April 01, 2018	(10,000)
Profit made during the year 2018-19	4,990