Question

The following is the trial balance of Manju Chawla on 31st March, 2016. You are required to prepare trading and profit and loss account and a balance sheet as on date.

$\begin{array}{ccc}\text{Name of Account}& \text{Debit (Rs.)}& \text{Credit (Rs.)}\\ \text{Opening Stock}& 10,000& -\\ \text{Purchases and Sales}& 40,000& 80,000\\ \text{Returns}& 200& 600\\ \text{Productive Wages}& 6,000& -\\ \text{Dock and Clearing Charges}& 4,000& -\\ \text{Donation and Charity}& 600& -\\ \text{Delivery Van Expenses}& 6,000& -\\ \text{Lighting}& 500& -\\ \text{Sales Tax Collected}& -& 1,000\\ \text{Bad Debts}& 600& -\\ \text{Miscellaneous Incomes}& -& 6,000\\ \text{Rent from Tenants}& -& 2,000\\ \text{Royalty}& 4,000& -\\ \text{Capital}& -& 40,000\\ \text{Drawings}& 2,000& -\\ \text{Debtors and Creditors}& 6,000& 7,000\\ \text{Cash}& 3,000& -\\ \text{Investment}& 6,000& -\\ \text{Patents}& 4,000& -\\ \text{Land and Machinery}& 43,000& -\end{array}$

Closing stock Rs. 2,000.

Answer 1

Trading and Profit and Loss Account
$\begin{array}{cccccccc}\text{Dr.}& & & & \text{for the year ended 31st March, 2016}& & & \text{Cr.}\end{array}\begin{array}{cccc}\text{Particulars}& \text{Amt (Rs.)}& \text{Particulars}& \text{Amt (Rs.)}\\ \text{Opening Stock}& 10,000& \text{Sales}80,000& \\ \text{Purchases}40,000& & (-)\text{Sales Return}\underset{–}{200}& 79,800\\ (-)\text{Purchases Return}\underset{–}{600}& 39,400& \text{Closing Stock}& 2,000\\ \text{Productive Wages}& 6,000& & \\ \text{Dock and Clearing Charges}& 4,000& & \\ \text{Royalty}& 4,000& & \\ \text{Gross Profit Transferred to}& 18,400& & \\ \text{Profit and Loss A/c}& & & \\ & \overline{\underset{–}{\underset{–}{81,800}}}& & \overline{\underset{–}{\underset{–}{81,800}}}\\ \text{Donation and Charity}& 600& \text{Gross Profit b/d}& 18,400\\ \text{Delivery Van Expenses}& 6,000& \text{Rent From Tenants}& 2,000\\ \text{Lighting}& 500& \text{Miscellaneous Incomes}& 6,000\\ \text{Bad Debts}& 600& & \\ \text{Net Profit transferred to Capital A/c}& 18,700& & \\ & \overline{\underset{–}{\underset{–}{26,400}}}& & \overline{\underset{–}{\underset{–}{26,400}}}\end{array}$

Balance Sheet
as at 31st March, 2016
$\begin{array}{cccc}\text{Capital and Liabilities}& \text{Amt. (Rs.)}& \text{Assets}& \text{Amt. (Rs.)}\\ \text{Capital}40,000& & \text{Investment}& 6,000\\ (+)\text{Net Profit}\underset{–}{18,700}& & \text{Patents}& 4,000\\ 58,700& & \text{Land and Machinery}& 43,000\\ (-)\text{Drawings}\underset{–}{2,000}& 56,700& \text{Cash}& 3,000\\ \text{Creditors}& 7,000& \text{Debtors}& 6,000\\ \text{Sales Tax Collected}& 1,000& \text{Suspense Account}& 700\\ & & \text{Closing Stock}& 2,000\\ & \overline{\underset{–}{\underset{–}{64,700}}}& & \overline{\underset{–}{\underset{–}{64,700}}}\end{array}$

Note: There is a difference of Rs. 700 in debit side of trial balance, so it will be shown in the assests side of the balance sheet.