Question

From the following ,calculate Operating Profits before Working Capital Changes:
`{:(,,"₹"),(,"Net Profit before Tax and Extraording Items","2,23,500"),(,"Deprection","42,000"),(,"Interest on Borrowings ","8,400"),(,"Goodwill Amortised","9,300"),(,"Loss on sale of Machinery","9,000"),(,"Premium on Redemption","3,000"),(,"Interset and Divident Received on Investments","13,800"),(,"Profit on sale of Investments","6,000"):}`

Answer 1

Answer:

PROFIT AND LOSS ACCOUNT 4. Following particulars have been extracted from the books of March 31st, 2019: 8,00,000 11,400 31,200 Sales Salesman Salaries 1,400 General expenses Bank Charges 48,000 4,800 Trade Debtors Insurance Premium 4,000 40,000 Life Insurance Premium Trade Creditors 6,000 Advertising 12,800 Interest on Investments 6,000 7,600 Profit on sale of plant Packing charges 4,400 Repairs Investments Bad debts 2,400 Bad Debts recovered 50,000 Building 4,00,000 10,000 Interest on capital 6,400 Freight on sales 3,200 Furniture and fittings 1,00,000 Commission paid 4,000 Office lighting and heating 7.000 Gross profit was 20% on sales. You are required to pass necessary closing entries and prepare a Profit and Loss Account for the year ending March, 31, 2019. [Ans. Net Profit * 74,200.] Note. Life Insurance premium is a personal expense of traders. It is to be treated as drawings.

Explanation:

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