Question

14. On 31st March, 2020 the following Trial Balance was prepared from the books of Manpreet:
Debi Balances
Credit Balances
₹
Funiture
3,400 Capital
Bullding
21,700 Discount received
1,00,000
Drawings
4,200 Bank Loan
2,000
Cash at Bank
2,470 Purchases Return
10,000
Wages
31,250
970
Sales
Discount Allowed
2,640
1,91,940
Sundry Creditors
Bank Charges
90
12,450
Provision for Doubtful Debts
Salaries
800
5,610
Purchases
1,32,700
Opening Stock
40,200
Cash in Hand
150
Sales Return
1,250
Carnage Inwards
3,400
Machinery
14,600
Sundry Debtors
43,800
Bad Debts
1,000
insurance
1,250
Pent
2,450
Bilis Receivable
2,500
Advertisement
3,500
3,18,160
3,18,160
Prepare Trading and Profit and Loss Account for the year ended 31st March, 2020 and also
the Balance Sheet as at that date after making the following adjustments:
(i) Closing Stock at cost was 35,000 whereas its net realisable value (market value)
was 3 30,000.
(ü) A new machine was purchased for 3,000 on 1st October, 2019 but it was not paid for
and no entry was passed in the books.
(ui) Wages include 3 500 paid for the installation of machinery.
(w) Provision for Doubtful Debts was raised to 1,400 and further bad debts of 7 300 were
written off.
(v) In the month of March, 2020, a fire broke out and destroyed stock to the value of
38,000. The insurance company admitted claim for loss of stock to the tune of 5,000
only and the amount was paid in April, 2020,
(vi) Outstanding wages were * 700 while outstanding salaries amounted to ? 500.
(vii) Prepaid insurance was * 250 and prepaid advertisement * 500.
(viii) Machinery was depreciated by 10% and furniture by 15%.​

Answer 1

Explanation:

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