Question 5.
Trial Balance of a business as at 31st March, 2018 is given below:
Prepare Trading and Profit and Loss Account for the year ended 31st March, 2018 and Balance Sheet as at that date after taking into account the following adjustments:
(i) Closing Stock was valued at ₹ 7,000.
(ii) Outstanding liabilities for wages were ₹ 600 and salaries ₹ 1,400.
(iii) Depreciation is to be provided @ 5% p.a. on all fixed assets.
(iv) Included in Plant and Machinery is a machine purchased for ₹ 10,000 on 1st October, 2017.
(v) Insurance premium paid in advance ₹ 200.
Answers
Check the attachment--
,
Trading and P&L A/c with Balance sheet as at 31.3.2018
Explanation:
Trading and P&L A/c
Particulars Amount(Rs.) Particulars Amount(Rs.)
To Opening Stock 25000 By Sales 227800
To Return Inwards 900 By Closing Stock 7000
To Wages 12600
(+600)
To Purchases 119000
(-1000)
To Gross Profit 77300
To Bad debts 1000 By Gross Profit 77300
To Salaries 21400 By Comm. 500
(+O/s salaries)
To Insurance Prem. 1300
(-200)
To Electricity Charges 1200
To Telephone 2400
To General Expenses 3000
To Postage 1800
To Depreciation:
Furniture 400
P&M 7250
To Net Profit 38050
(bal.)
77800 77800
Balance Sheet
as at 31.3.2018
Notes to A/c Amount(Rs.)
Non-Current Assets:
Furniture 7600
P&M 142750
Current Assets:
Debtors 30,000
Cash in Hand 2500
Cash at Bank 40,000
Closing Stock 7000
Prepaid Insurance 200
Total(A) 230050
Non-Current Liabilities:
Capital 188050
(+38050)
Current Liabilities:
Creditors 40,000
O/s Wages 600
O/s Salaries 1400
Total(B) 230050