Question

The following trial balance is extracted from the books of M/s Ram on March 31, 2011. You are required to prepare Trading and Profit and Loss account and the balance sheet as on date

$\begin{array}{cccc}\text{Account Title}& \text{Amt. (Rs.)}& \text{Account Title}& \text{Amt. (Rs.)}\\ \text{Debtors}& 12,000& \text{Apprenticeship Premium}& 5,000\\ \text{Purchase}& 50,000& \text{Loan}& 10,000\\ \text{Coal, Gas and Water}& 6,000& \text{Bank Overdraft}& 1,000\\ \text{Factory Wages}& 11,000& \text{Sales}& 80,000\\ \text{Salaries}& 9,000& \text{Creditors}& 13,000\\ \text{Rent}& 4,000& \text{Capital}& 20,000\\ \text{Discount}& 3,000& & \\ \text{Advertisement}& 500& & \\ \text{Drawings}& 1,000& & \\ \text{Loan}& 6,000& & \\ \text{Petty Cash}& 500& & \\ \text{Sales Return}& 1,000& & \\ \text{Machinery}& 5,000& & \\ \text{Land and Building}& 10,000& & \\ \text{Income tax}& 100& & \\ \text{Furniture}& 9,900& & \end{array}$

Answer 1

Trading and Profit and Loss Account
as on 31st March, 2011
$\begin{array}{cccc}\text{Particulars}& \text{Amt. (Rs.)}& \text{Particulars}& \text{Amt. (Rs.)}\\ & & \text{Sales}80,000& \\ \text{Purchase}& 50,000& \text{(-)Sales Return}\underset{–}{1,000}& 79,000\\ \text{Coal and Water}& 6,000& & \\ \text{Factory Wages}& 11,000& & \\ \text{Gross Profit c/d}& \underset{–}{12,000}& & \underset{–}{}\\ & \underset{–}{79,000}& & \underset{–}{79,000}\\ \text{Salaries}& 9,000& \text{Gross Profit b/d}& 12,000\\ \text{Rent}& 4,000& \text{Apprenticeship Premium}& 5,000\\ \text{Discount}& 3,000& & \\ \text{Advertisement}& 500& & \\ \text{Net Profit}& \underset{–}{500}& & \underset{–}{}\\ & \underset{–}{17,000}& & \underset{–}{17,000}\end{array}$

Balance Sheet
as on 31st March,2011
$\begin{array}{cccc}\text{Capital and Liabilities}& \text{Amt. (Rs.)}& \text{Assets}& \text{Amt. (Rs.)}\\ \text{Capital}20,000& & \text{Machinery}& 5,000\\ \text{(+)Net Profit}\underset{–}{500}& & \text{Land and Building}& 10,000\\ 20,500& & \text{Furniture}& 9,900\\ \text{(-)Drawings}1,000& & \text{Loan and Advances}& 6,000\\ \text{(-)Income Tax}\underset{–}{100}& 19,400& \text{Debtors}& 12,000\\ \text{Creditors}& 13,000& \text{Petty Cash}& 500\\ \text{Loan}& 10,000& & \\ \text{Bank Overdraft}& \underset{–}{1,000}& & \underset{–}{}\\ & \underset{–}{43,400}& & \underset{–}{43,400}\end{array}$