S.
17
ILLUSTRATIONS
Financial Accounting
Noncomprehensive Illustrations
Hustration 1
Prepare Trading Account of Archana for the year ending31-12-96 from the
following information:
Rs.
Opening Stock 80,000
Purchases 8,60,000
Freight Inward 52,000
Wages 24,000
Sales 14,40,000
Purchase Returns 10,000
Sales Returns 3,16,000
Closing Stock 1,00,000
Import duty 30,000
Illustration 2
From the following balances extracted at the close of the year ended 31st
Dec. 1996, prepare Profit and Loss account of Mr. Raj as at that date:
Rs. Rs.
Gross profit 55,000 Repairs 500
Carriage on sales 500 Telephone expenses 520
Office Rent S00 Interest (Dr.) 480
General expenses 900 Fire insurance premium 900
Discount to customers 360 Bad debts 2,100
Interest from Bank 200 Apprentice Premium (Cr.) 1,500
Travelling expenses 700 Printing & Stationery 2,500
Salaries 900 Trade expenses 300
Commission 300
Overdraft
Capi
BankWeita'sl
Tefol owinasgtrartheion 4
Comprehensive
Ilustrations
ledger
balances
50,000
Sales Rs.
nwards
Return
8,400
extracted
from
the
books
3,01,000
Rs.
5,000
Adjustments : 5.29
Purchases Debtors
tenants'
from Furniture
Rent Creditors
premises
Business
L/
OpeniStonckg
(iv)Make(iü) a )
ce.
edAllow Rs. Stock
520.Write
interest off on
provision
depreciation hand cl
on on
Capital 31-12-1995
of 2,20,000
5% Commission Salaries
allowed
36,00044,000
Expenses
General
26,60040,000
on 2,000 Discount5,(Cr.
200)
on
atbusiness
5%
debtors was Provision
BadCarriage Insurance
T¡xes &
and estimaed debts
premises
carry for
bad for on
orward written
purchases
& Rs. asDoubtful
doubtful
debts. Rs. Accountíng
Financial
600 off
Rs. 40,120.
and debts
1,400
furniture
for ,600 L000 3,600 4,40018,0008.000 4,000
800
lustration12
PrepareTrading, Profit &LoSs A/c and Balance Sheet
of
| Balánce fMr. M. Madan,.
Trial
from the following
DebitBalances Rs.
Sundry,pebtors A Credit Balances Rs.
& Machinery A
92,000|Madan's Capital 70,000
Plant
20.000 Purchase Returns 2,600
Interest 430 Sales
Rates, Taxes, &Insurance 2,50,000
Rent,
Conveyance charges 5,600 Sundry Creditors 60,000
1.320 Bank Overdraft L L
20,000
Wages T 7,000
SalesReturns
1
5,400
Purchases 1,50,000
OpeningStock 60.000
Madan's Drawings 22,000
Trade Expenses 1,350
Salaries 11,200
AdvertisingE 840
Discount E 600
Bad debts E 800
Business premises 12,000
Furmiture &Fixtúres L 10,000
Cash in hand 2,060
4,02,600 4,02,600
Adjustments:
) Stock on hand on 31-12-96 Rs. 90,000.
) Provide depreciation on premises at 2.5%; Plant &Machinery at
7.5% and furniture &fixtures at 10%.
(ii) Write off Rs. 800 as further bad debts. +
(iv) Provide for doubtful debts at 5% on sundry debtors.
(V) Outstanding rent was Rs. 500 and outstanding wages Rs. 400. -t
(i) Prepaid insurance Rs. 300 and prepaidsalaries Rs. 700.
[Periyar, B.Com., Nov, 2005]
5.37
Illustration 15
Financial Accounting
Balance of Sri. Narayanan, you are requiredIto
From the following Trial
a Trading and Profit
& Loss Alc for the year ended 31st December
date. 1997 prepare
and a
Balance Sheet as on that
Debit Balances Rs. Credil Balances
Rs.
Sock on lst Jan, 1997 70,000Capital
Plant & Machinery 50,000 Wages outstanding 2,00,000
3.000Sales 4,000
Rent
Depreciation on Plant & Machinery 5,000Creditors 5,45,00,000000
Drawings 40,000 Bills Payable
Wages 20,000Discount (Cr) 16,00
12,000
Income tax 2,000 Bank Overdraft 9,000
Salary for 1lmonths 11,000|Commission (Cr) 8.000
Cash 5,000Purchase returns 5,000
Buildings 1,600,000
Depreciation on Buildings 8,000
Purchases 3,00,000
Debtors 80,000
Bills Receivable 30,000
Discount (Dr) 2,000
Carriage Inwards 4,000
Bad debts 6,000
Sales returns 3,000
7,99,000 7,99,000
Adjustments:
) Stock on 31st Dec. 1997was Rs. 96,000.
() Stock destroyed by fire was Rs. 6,000 and the Insurance company
accepteda claimfor Rs. 3,600:
(im) Rs. 1,600 paid as rent of the ofice was debited to Landlord aceount
and was included in the list of Debtors.
(iv) Goods invoiced Rs. 10,000 was sent to customers onsale or return
basis on 28th December 1997, the customers still having the right
to return the goods. The rate of gross profit was 1/5 of sale.
(V) Write off further bad debts Rs. 4,000 and maintain 5% provision
for bad debts on debtors.
(vi) One month's salary was outstanding. (|
(B.Com., Mysore Adaptedl
Periyar BBA May 2004]
below: A/c
200
546 574 2,590834 20,00019,890
1.24,184
8,60047,560
32,310 figs17,-R7s.1,46;3Tot
6,21994.
40)a31stl
March
Rs. Loss Rs. I2
given Profit- 2007-Rs.
& Balance
R-s.
information Customers Profit AprilProfit
Net
32,290:
ExpensesBankNet
Returns
Purchase
4.420| (SYLA).
ofPrasad
on.
(Factory)
3.600
Rent(0ffice)
RentReturns
Sales
Alc,
from10,240; Stock
(1-1-95)
to Trading Sheet
the Discount Bad Machinery
debts Insurance Purchases
General Interest Postage Buildings BCS
Furniture
from Rs. Interest
Wages
books
a .Madras
Account | S00 Profit- prepare 28,600
the
Rs. 18,260
3.620 32,000 400 Profit from
1995.
December
Arvind, 72,000
17,440 24,000 7,770 2,000 Rs.
5,0541,56,364 8,000
loss Gross Rs.
31-12-95Gross
extracted
: and
Accounts JAns:of |Ans:
profit onCariage balances
purchases on were
31
stat hand
Finalandtrading
balances
Stock
Opening StockClosing Sales
on
Caiage following
Credit
Balances: on
Sheet
as Bills
Pavable
Prepapat1LArionepare
of Purchases
Wages Sales the Balance
Creditors
Capital
Debit
Balances:
Discount
Debtors
Salanes
goods
of
following
SalesLoan
From Value
The
12.
13.
FinalA ccounts 5.60
Rs. Rs.
5,000
Capital 50,000 Creditors
Drawings 4,000 Bad debts 1,100
General Expenses 5,000 Loan 15,760
Buildings 22,000 Sales 1,30,720
Machinery 18,680 Purchases 94,000
32,400 Motor Car 4,000
Stock
Power 4,480 Reserve Fund (Cr.) 1,800
Taxes & Insurance 2,630 Commission (Cr.) 2,640
Wages 14,400 Car Expenses 3,600
Debtors 12,560 Bills Payable 6,700
Bank Overdraft 6,600 Cash 160
Charity 210
Stock on 31st March 1994 was valued at Rs. 47.000, Prepare the final Accounts for
the year ended on 3lst March 1994.
[Ans: Gross Profit - Rs 32,440; Net Profit - Rs. 22,540;
Balance Sheet Total - Rs. 1,04,400]
thefollowing Trial Balance ofRavi, :prepare Trading and Profit and Loss Account
fom
or the year ended December 31st 1993 and a Balance Sheet as on that date:
Trial Balance
Particulars Debit Credit
Rs. Rs.
Capital 40,000
Sales 25,000
Purchases 15,000
Salaries 2,000
Rent 1,500
Insurance 300
Drawings 5,000
Machinery 28,000
Bank Balance 4,500
Cash 2,000
Stock 1-1-93 5,200
Debtors 2,500
Creditors 1,000
66,000 66,000
Adjustments required :
(a) Stock on 31-12-93 Rs. 4,900
(b) Salaries unpaid Rs. 300
(c) Rent paid in advance Rs. 200
(d) Insurance prepaid Rs. 90
(Madras, B. C.S. (1CE) MAy 2002]
[Ans : GP.:Rs. 9,700; N.P. : Rs.5,890; B/s Total : Rs. 42,190]
Final
Acconts
month's rent
has been paid in 5.62
One advance.
Provide 5per cent for doubtful debts.
IAns: Gross Profit - Rs.[Madras, B.Com., March 1997|
16,000; Net Profit - Rs. 6,200;
Preparea TTrading and
Profit &Loss Alc Balance Sheet Total - Rs.
BalanceSheet as on that date from the
for the year ended 31st 56,2001
December 1995
following Trial Balance of Mr. Akilan: and
Rs.
Drawings 45,000 Rs.
Goodwill 90,000
Capital 1,60,000
Bills Payable
Buildings 60,000 Creditors 35,000
Machinery 40,000 70,000
BllsReceivable
Purchase Returns 2,650
6,000 Sales
OpeningStock 40,000 2,18,000
Purchases S1,000
Wages 26,000
CarriageOutwards 500
CarriageInwards 1,000
Salaries 35,000
Rent 3,000
Discount 1,100
Repairs 2,300
Bank 25,000
Cash 1,600
Debtors 45,000
Bad debts 1,200
Sales Retuns 2,000
Furniture 6,000
Advertisements 3,500
General Expenses 450
4,85,650 4,85,650
Adjustments.:
() Closing Stock was Rs. 35,000.
() Depreciate Machinery and furniture by 10%.
(i) Outstanding wages Rs. 1,500.
(iv) Prepaid advertisement Rs. 500.
(") Create 5% on debtors for bad debts as provision.
[Madras,BSe, May 1997]
(Ans: Gross Profit - Rs. 1,34,1s0;
Net Profit - Rs. 80,750; Balance Sheet Total - R_ 3,02,250]
extracted;fromthe ledger of Karikalan as on
YThe
following the
are
balances
December
M.1993: Rs.
Reservefor discount on debtors
RS.
20,000 200
Karikalan'sCapitalA/c
3,500 Loan(@9% 5,000
Drawings 10,000 Salaries
4,400
Buildings 2,500 Wages
Machinery
1,500
Furniture&fittings
600 Rent 2,750
OpeningStock
12,500 Travelling expenses 1,250
400| Postage &telegrams 135
Cycle 75,000 Rates &taxes 90
Purchases
1,25,000 CarriageInwards 2,500
Sales
Sales Returns 5,000 Carriage Outwards 750
15,000 Interest paid 375
Duty paid on purchases
Sundry debtors 10,000 General charges 900
Sundry creditors 7,500 Bad debts 300
Reserve for bad &doubtful Cash in hand 250
debts 400 Cash at Bank 2,400
The following adjustments are necessary:
(a) Stock on 31-12-93 Rs. 14,000.
(b) Provide the following outstanding:
Salary Rs. 400; Rent Rs. 250: Wages Rs. 600 and Interest Rs. 75
(c) Maintain the reserve for doubtful debts at 5% and the reserve for discount ou
debtors at 2.5% on sundry debtors.
(d) Provide depreciation for Building 2.5%, Machinery 10%, Furniture 6% and
Cycle 15%.
Prepare Trading & Profit and Loss A/c
and the Sheet for the year
ended
31-12-93. Balance
[Madras, B.Se.. May 1995)
Manager's
1993,the Trial balance of Janakiraman & Co., was as followR
33. On31st December
Rs. Credit Balances
DebitBalances
40,000 Capital (fixed) Rs.
OpeningStock 30,000 Creditors
Debtors 15,000 Bills Payable 15,090
BillsReceivable
CarriageInward
1,500 Miscellaneous Receipts
Commission
1,545000
13,000
Wages 10,000 Bad debts Provision 2,500
Salaries 1,000 Sales S50
Telephone 350 1,67,209
Repairs 85,000
Purchases
Cash at Bank 17,000
Plant &Machinery 65,800
Furmiture 9,000
Miscellaneous Expenses 350
Depreciation 5,200
2,93,200 2.93,200
The following additional iFformation is to be taken into consideration:
) Closing Stock amounted to Rs. 50,000.
(ü) Bad debts provision to be equal to 1'/4% of debtors.
(iii) Interest on Capital to be provided for at 2.5% p.a.
(iv) Provide outstanding liabilities:
Salaries- Rs. 2,500; Wages - Rs. 1,750; Rent - Rs. 7,500
(v) It was discovered that stock sheets as on 31-12-1992 were Over cast to the
extent of Rs. 1,000.
Prepare Trading &Profit &Loss Ac of the fim for the ended31st December
1993 and a balance Sheet as at year
that date:
PrelEram/
|Indian Institute of Company. Secretaries
49,675;
|Ans: Gross Profit - Rs. 76,950; Net Profit- Rs.1,86,425]
34 From the Sheet total - Rs.
