Question

Prepare Trading Account for the year ended 31st March 2020 from the following balances: 2 <br /><br /> Amount (Rs.) Amount (Rs.) <br /><br />Stock as on 01.04.2019 1,00,000 Purchases 10,00,000 <br /><br />Wages 50,000 Carriage Inwards 10,000 <br /><br />Sales 15,50,000 Returns Inward 50,000 <br /><br />Return Outward 80,000 Freight 5,000 <br /><br />Closing Stock as on 31.03.2020 was valued at Rs. 2,00,000.<br /><br />​

Answer 1

Answer:

The trading account is in attachment ;

Go through it..

Gross Profit = 6,15,000.

Some important Notes :

• Purchase return will be deducted from purchased ( return Outwards ) And sales return is also deducted from total Sales ( Return Inwards ).

• Carriage inwards is recorded in Trading account and carriage Outwards is recorded in Profit and loss account.

• Wages and direct expenses are shown in trading account.

• The balance of trding Account is called Gross Profit

• Gross profit is transferred to profit and loss account.

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