Question

3. Sharma commenced business on 1st January 1990 with a capital of Rs. 20,000. He
immediately bought furniture & fixtures for Rs. 4,000. On 30th June 1990, he borrowed
Rs. 10,000 from his wife @ 9% p.a. (interest not yet paid) and introduced a further
capital of his own amounting to Rs. 3000 Sharma withdrew at the rate of Rs. 600
p.m. at the end of each month for household expenses. On 31st December 1990, his
position was as follows:-
Cash in hand Rs. 5,600; Sundry debtors Rs. 9,600; Stock Rs. 13,600; Bills
receivable Rs. 3,200, Sundry creditors Rs. 1,000 and owing for Rent Rs. 300. Furniture
and fixtures to be depreciated by 10%.
Ascertain the profit or loss made by Sharma during 1990.​

Answer 1

Answer:

Sharma commenced business on 1st January 1990 with a capital of Rs. 20,000. He

immediately bought furniture & fixtures for Rs. 4,000. On 30th June 1990, he borrowed

Rs. 10,000 from his wife @ 9% p.a. (interest not yet paid) and introduced a further

capital of his own amounting to Rs. 3000 Sharma withdrew at the rate of Rs. 600

p.m. at the end of each month for household expenses. On 31st December 1990, his

position was as follows:-