Trial Balance of a business as at 31st March, 2019 is given below:

Particulars Dr.
(₹) Particulars Cr.
(₹)

Stock on 1st April, 2018 25,000 Sales 2,27,800

Furniture 8,000 Commission 500

Plant and Machinery 1,50,000 Returns Outward 1,000

Debtors 30,000 Creditors 40,000

Wages 12,000 Capital 1,50,000

Salaries 20,000

Bad Debts 1,000

Purchases 1,20,000

Electricity Charges 1,200

Telephone Charges 2,400

General Expenses 3,000

Postage Expenses 1,800

Returns Inward 900

Insurance Premium 1,500

Cash in Hand 2,500

Cash at Bank 40,000

4,19,300 4,19,300

Prepare Trading and Profit and Loss Account for the year ended 31st March, 2019 and Balance Sheet as at that date after taking into account the following adjustments:
(i) Closing Stock was valued at ₹ 7,000.
(ii) Outstanding liabilities for wages were ₹ 600 and salaries ₹ 1,400.
(iii) Depreciation is to be provided @ 5% p.a. on fixed assets.
(iv) Included in Plant and Machinery is a machine purchased for ₹ 10,000 on 1st October, 2018.
(v) Insurance premium paid in advance ₹ 200.

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Solution

Trading Account

for the year ended March 31, 2018

Dr.
Cr.

Particulars

Amount

(₹)

Particulars

Amount

(₹)

Opening Stock
25,000
Sales
2,27,800

Purchases
1,20,000

Less: Returns
900

2,26,900

Less: Returns
1,000

1,19,000
Closing Stock
7,000

Wages
12,000

Add: Outstanding Wages
600

12,600

Gross Profit
77,300

2,33,900

2,33,900

Profit & Loss Account

for the year ended March 31, 2018

Dr.
Cr.

Particulars

Amount

(₹)

Particulars

Amount

(₹)

Bad Debts
1,000
Gross Profit
77,300

Insurance Premium
1,500

Commission
500

Less: Prepaid
200

1,300

Salaries
20,000

Add: Outstanding Salaries
1,400

21,400

Electricity Charges
1,200

General Expenses
3,000

Postage Expenses
1,800

Telephone Charges
2,400

Depreciation on:

Furniture
400

Plant & Machinery
7,250

7,650

Net Profit
38,050

77,800

77,800

Balance Sheet

as on March 31, 2018

Dr.
Cr.

Liabilities

Amount

(₹)

Assets

Amount

(₹)

Creditors
40,000
Furniture
8,000

Outstanding Wages
600
Less: Depreciation
400

7,600

Outstanding Salaries
1,400
Plant & Machinery
1,50,000

Capital
1,50,000

Less: Depreciation
7,250

1,42,750

Add: Net Profit
38,050

1,88,050
Cash at Bank
40,000

Cash in Hand
2,500

Closing Stock
7,000

Debtors
30,000

Prepaid Insurance
200

2,30,050

2,30,050

Suggest Corrections

108

Similar questions

Q. Following is the Trial Balance of Mr. Bharat on 31st March, 2018.


Particulars	Dr. (₹)	Cr. (₹)
Capital		40,000
Plant and Machinery	50,000
Office Furniture and Fittings	2,600
Stock on 1st April, 2017	48,000
Accrued Commission	12,000
Sundry Debtors	45,700
Cash in Hand	400
Cash at Bank	6,500
Wages	1,50,000
Salaries	14,000
Purchases	2,13,500
Sales		4,80,000
Bills Receivable	7,200
Bills Payable		5,600
Sundry Creditors		52,000
Returns Inward	9,300
Provision for Doubtful Debts		2,500
Drawings	7,000
Returns Outward		5,500
Rent	6,000
Factory Lighting and Heating	800
Insurance	6,300
General Expenses	1,000
Bad Debts	2,500
Discount	6,500	3,700
Total	5,89,300	5,89,300

Following adjustments are to be made:
(a) Stock on 31st March, 2018 ₹52,000.
(b) Three months' factory lighting and heating due but not paid ₹300.
(c) 5% depreciation to be written off on furniture.
(d) Write off further Bad Debts ₹700.
(e) Provision for Doubtful Debts to be increased to ₹3,000 and Provision of Discount on Debtors @ 2% to be made.
(f) During the year, machinery was purchased for ₹20,000 but it was debtied to the Purchases Account.

You are required to prepare Trading Account, Profit and Loss Account and Balance Sheet.

Q. From the following balances, as on 31st March, 2019, prepare Trading and Profit and Loss Account and Balance Sheet:

	₹		₹
Capital Account	1,00,000	Returns Outward	5,000
Plant and Machinery	40,000	Rent	4,000
Sundry Debtors	24,000	Sales	1,64,000
Sundry Creditors	12,000	Manufacturing Expenses	8,000
Life Insurance Premium	12,000	Trade Expenses	7,000
Purchases	1,05,000	Bad Debts	2,000
Wages	50,000	Carriage	1,500
Bank	10,000	Bills Payable	7,000
Repairs	500	Returns Inward	4,000
Stock (1st April, 2018)	20,000

Closing Stock on 31st March, 2019 was valued at ₹ 14,500.

Q. From the following Trial Balance of Shubho, prepare final accounts for the year ended 31st March, 2019 and Balance Sheet as at that date:


Particulars	Dr. Balances (₹)	Cr. Balances (₹)
Land and Building	50,000
Purchases (Adjusted)	2,10,000
Stock (31st March, 2019)	45,000
Returns Inward	1,500
Returns Outward		2,500
Wages	45,300
Salaries	39,000
Office Expenses	15,400
Carriage Inwards	1,200
Carriage Outwards	2,000
Discount allowed	750
Discount received		1,200
Bad Debts	1,200
Sales		3,85,000
Capital Account		1,15,000
Chatterji's Loan A/c (taken on 1st Oct., 2018 @ 18% p.a.		25,000
Insurance	1,500
Commission		1,500
Plant and Machinery	50,000
Furniture and Fixtures	20,000
Bills Receivable	20,000
Sundry Debtors	40,000
Sundry Creditors		25,000
Cash at Bank	16,000
Office Equipments	12,000
Bills Payable		12,350
Expenses Payable		3,300
Total	5,70,850	5,70,850

The following adjustments be taken care of:
(i) Depreciate Land and Building @ 6%, Plant and Machinery @ 10%, Office equipments @ 20% and Furniture and Fixtures @ 15%.
(ii) Calculate Provision for Doubtful Debts at 2% on Sundry Debtors.
(iii) Insurance premium includes ₹ 250 Insurance Premium paid in advance.
(iv) Provide salary to Shubho ₹ 15,000 p.a.
(v) Outstanding Salaries ₹ 11,500.
(vi) 10% of the final profit is to be transferred to General Reserve.

Q. From the following Trial Balance of Shubdo Banerjee, prepare final accounts for the year ended in 31st March, 2018 and Balance Sheet as at that date:


Particulars	Dr. Balances (₹)	Cr. Balances (₹)
Land and Building	50,000
Purchases (Adjusted)	2,10,000
Stock (31st March, 2018)	45,000
Returns Inward	1,500
Returns Outward		2,500
Wages	45,300
Salaries	39,000
Office Expenses	15,400
Carriage Inwards	1,200
Carriage Outwards	2,000
Discount allowed	750
Discount received		1,200
Bad Debts	1,200
Sales		3,85,000
Capital Account		1,15,000
Chatterji's Loan A/c (taken on 1st Oct., 2017 @ 18% p.a.		25,000
Insurance	1,500
Commission		1,500
Plant and Machinery	50,000
Furniture and Fixtures	20,000
Bills Receivable	20,000
Sundry Debtors	40,000
Sundry Creditors		25,000
Cash at Bank	16,000
Office Equipments	12,000
Bills Payable		12,350
Expenses Payable		3,300
Total	5,70,850	5,70,850

The following adjustments be taken care of:
(i) Depreciate Land and Building @ 6%, Plant and Machinery @ 10%, Office equipments @ 20% and Furniture and Fixtures @ 15%
(ii) Calculate Provision for Doubtful Debts at 2% on Debtors.
(iii) Insurance premium includes ₹250 paid in advance.
(iv) Provide salary to Banerjee ₹15,000 p.a.
(v) Outstanding Salaries ₹11,500.
(vi) 10% of the final profit is to be transferred to General Reserve.

Q. Following balances were extracted from the books of Vijay on 31st March, 2019:

Particulars	₹	Particulars	₹
Capital	2,45,000	Loan	78,800
Drawings	20,000	Sales	6,53,600
General Expenses	47,400	Purchases	4,70,000
Building	1,10,000	Motor Car	20,000
Machinery	93,400	Provision for Doubtful Debts	9,000
Stock on 1st April, 2018	1,62,000	Commission (Cr.)	13,200
Insurance	13,150	Car Expenses	18,000
Wages	72,000	Bills Payable	38,500
Debtors	62,800	Cash	800
Creditors	25,000	Bank Overdraft	33,000
Bad Debts	5,500	Charity	1,050

Prepare Trading and Profit and Loss Account for the year ended 31st March, 2019 and Balance Sheet as at that date after giving effect to the following adjustments:
(a) Stock as on 31st March, 2019 was valued at ₹ 2,30,000.
(b) Write off further ₹ 1,800 as Bad Debts and maintain the Provision for Doubtful Debts at 5%.
(c) Depreciate Machinery at 10%.
(d) Provide ₹ 7,000 as outstanding interest on loan.

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Trading Account for the year ended March 31, 2018
Dr.					Cr.
Particulars		Amount (₹)	Particulars		Amount (₹)
Opening Stock		25,000	Sales	2,27,800
Purchases	1,20,000		Less: Returns	900	2,26,900
Less: Returns	1,000	1,19,000	Closing Stock		7,000
Wages	12,000
Add: Outstanding Wages	600	12,600
Gross Profit		77,300
		2,33,900			2,33,900

Profit & Loss Account for the year ended March 31, 2018
Dr.					Cr.
Particulars			Amount (₹)	Particulars	Amount (₹)
Bad Debts			1,000	Gross Profit	77,300
Insurance Premium	1,500			Commission	500
Less: Prepaid	200		1,300
Salaries	20,000
Add: Outstanding Salaries	1,400		21,400
Electricity Charges			1,200
General Expenses			3,000
Postage Expenses			1,800
Telephone Charges			2,400
Depreciation on:
Furniture		400
Plant & Machinery		7,250	7,650
Net Profit			38,050
			77,800		77,800

Balance Sheet as on March 31, 2018
Dr.					Cr.
Liabilities		Amount (₹)	Assets		Amount (₹)
Creditors		40,000	Furniture	8,000
Outstanding Wages		600	Less: Depreciation	400	7,600
Outstanding Salaries		1,400	Plant & Machinery	1,50,000
Capital	1,50,000		Less: Depreciation	7,250	1,42,750
Add: Net Profit	38,050	1,88,050	Cash at Bank		40,000
			Cash in Hand		2,500
			Closing Stock		7,000
			Debtors		30,000
			Prepaid Insurance		200
		2,30,050			2,30,050