Question 8.
Ram Prashad keeps his books on Single Entry System and from them and the particulars supplied, the following figures were gathered together on 31st March, 2018:
Book Debts ₹ 10,000; Cash in Hand ₹ 510; Stock-in-Trade (estimated) ₹ 6,000; Furniture and Fittings ₹ 1,200; Trade Creditors ₹ 4,000; Bank Overdraft ₹ 1,000; Ram Prashad stated that he started business on 1st April with cash ₹ 6000 paid into bank but stocks valued at ₹ 4,000. During the year he estimated his drawings to be ₹ 2,400. You are required to prepare the statement, showing the profit for the year, after writing off 10% for Depreciation on Furniture and Fittings.
Answers
Statement of Profit or Loss with Statement of Affairs
Explanation:
In the Books of Ram Prasad
Statement of Affairs
as on 31.3.2018
Liabilities Amount(Rs.) Assets Amount(Rs.)
Creditors 4000 Book Debts 10,000
Bank O/D 1000 Cash in Hand 510
Capital(bal.) 12590 Stock 6000
Furniture 1080
(-Dep.@10%)
17590 17590
Statement of Affairs
as on 1.4.2017
Liabilities Amount(Rs.) Assets Amount(Rs.)
Capital(bal.) 10,000 Bank 6000
Stock 4000
Statement of Profit/Loss
for the year ended 31.3.2018
Particulars Amount(Rs.)
Capital as on 31.3.2017 12590
Add:Drawings 2400
14990
Less:Capital as on 1.4.16 (10,000)
Profit made during the year 2016-17 4990
Answer:
The solution is in the image
