Question

1. The assets and liabilities of Mr. Well on 14 January and on 31* December 2018 were as
follows:
Particulars
Cash in hand and at bank
Motor van
Sundry Debtors
Stock in trade
Fixed Assets
Creditors
1" January
4,005
2,000
15,000
3,700
60,000
5,705
31 December
3,000
3,500
25,000
3,800
60,000
6,700
Calculate the profit after charging interest on capital in the beginning @ 5% per annum after
providing interest on drawings @ 6% per annum. Drawings were Rs 14,000.
Adjustments:
a) Depreciate fixed assets by 10%
b) Write off Rs. Rs.400 from Motor van
c) Debtors include Rs.400 irrecoverable and a future reserve of 2% is to be made
Also prepare a Revised Statement of Affairs

Answer 1

Explanation:

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