Pawan started a business on 1st April 2019, with a Capital of `5,00,000. During the year he
withdrew `1,00,000 for household expenses and introduced `40,000 as fresh Capital. His
position of assets and liabilities as at 31st March 2020 stood as follows:
Particulars `
Cash in Hand
Stock
Bills Receivable
Debtors
Creditors
Bills Payable
30,000
40,000
60,000
8,50,000
2,00,000
10,000
You are required to prepare statement of profit or loss for the year ended 31st March 2020
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Answer:
Statement of Profit or Loss
Particulars
Amount
(Rs)
Capital at the end
90,000
Add: Drawings
5,000
95,000
Less: Additional Capital Introduced
(10,000)
Adjusted Capital at the end
85,000
Less: Capital in the beginning
60,000
Net Profit for the year
25,000
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