Question

Traders for the year ending 31st March, 2018:
was a liability only in the balance
1.500
inal balance, without opening date, it is
alance (le uneared income) is given on the cream
in If any income received in advance is
opening date. It is a brought forward be
year. Il le added in the related income in the Pro & Loss Account only
ILLUSTRATION 6. The following trial balance is extracted from the books of Panchkula
dit side of a trial balance with
cearned income from the previous
95
Particulars
Debit
Balance
Credit
Balance
red by
ill done
balanced
8.000
35.000
80,000
2.000
3.000
8.500
25,000
15.000
600
2,000
700
500
1.800
2.500
1200
20,000
Paan
1.000
sed Payable
5,000
1400
9.500
2.000
4.400
1.14.500
1,14,500
You are required to prepare Trading and Profit & Loss Account for the year ending 31st
March, 2018 and Balance Sheet at that date, after considering the following adjustments :
Closing Stock on 31.3.2018 was valued at 12,500.
) Iurance prepaid is 100.
a) Commission received in advance is? 400.
) Interest 50 has been earned but not yet received
b) Balaries outstanding 600 and wages outstanding + 80
been
POUDA
March, 2017
Solution :
Trading and Profit & Loss Account of Panchkula Traders
for the year ending 31st March, 2018
Parafars
Amound
Particular
Cr.
Amount
r
Y

Answer 1

Explanation:

Unearned revenue is money received by an individual or company for a service or product that has yet to be provided or delivered. It can be thought of as a "prepayment" for goods or services that a person or company is expected to supply to the purchaser at a later date. As a result of this prepayment, the seller has a liability equal to the revenue earned until the good or service is delivered. This liability is noted under current liabilities, as it is expected to be settled within a year.