From the following Trial Balance of Sh. Swamy Narain, prepare Trading and Profit and Loss Account for the year ended 31st March 2023 and a Balance Sheet as at that date:
From the following Trial Balance of Sh. Swamy Narain, prepare Trading and Profit and Loss Account for the year ended 31st March 2023 and a Balance Sheet as at that date:
| Dr. Balances | ₹ | Cr. Balances | ₹ |
| Opening Stock | 50,000 | Capital | 20,00,000 |
| Purchases | 5,30,000 | Sales | 12,50,000 |
| General Expenses | 45,000 | Sundry Creditors | 1,36,000 |
| Stationery | 6,000 | Trade Charges due but not paid | 5,000 |
| Wages | 2,15,000 | Outstanding Rent | 4,000 |
| Trade Charges | 25,000 | Bank Balance | 45,000 |
| Rent | 44,000 | Â | Â |
| Charity | 5,000 | Â | Â |
| Advertisement Expenses | 30,000 | Â | Â |
| Carriage on Sales | 12,000 | Â | Â |
| Bills Receivables | 30,000 | Â | Â |
| Sundry Debtors | 2,20,000 | Â | Â |
| Cash Discount | 16,000 | Â | Â |
| Cash in Hand | 22,000 | Â | Â |
| Furniture | 1,00,000 | Â | Â |
| Advance for Furniture | 40,000 | Â | Â |
| Plant & Machinery | 6,00,000 | Â | Â |
| Building | 14,50,000 | Â | Â |
| Â | 34,40,000 | Â | 34,40,000 |
Adjustments:
(i) Stock on 31st March, 2023 was valued at ₹ 60,000.
(ii) A new machine was installed during the year costing ₹ 2,00,000 but it was not recorded in the books. Wages paid for its installation ₹ 10,000 have been debited to Wages Account.
(iii) An advance of ₹ 10,000 given alongwith purchase order was wrongly recorded in purchases.
(iv) General expenses include ₹ 20,000 paid for Wages.
(v) Wages include a sum of ₹ 50,000 spent on the erection of a Scooter Stand for employees.
(vi) Advance for Furniture is for furniture at proprietor’s residence.
(vii) Depreciate Furniture at 15% , Plant & Machinery at 20% and Building at 10%.
(viii) Carry forward 2/3 of Advertisement Expenses as unexpired.
(ix) A B/R of ₹ 20,000 was discounted with bank on 15 Nov. 2022, but not yet matured.
[Ans. Gross Profit ₹ 5,65,000; Net Profit ₹ 95,000; Balance Sheet Total ₹ 24,45,000.]
Solution:-
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Solution:-
Hints:
(i) Creditors for Machinery ₹ 2,00,000 will be shown in Liabilities. Depreciation on Plant & Machinery ₹ 1,62,000.
(ii) ₹ 50,000 spent on scooter stand will be added to Building. Depreciation on Building ₹ 1,50,000.
(iii) Advance for ₹ 10,000 alongwith purchase order will be shown on asset side.
(iv) B/R discounted will not be recorded since it is contingent liability. As contingent Liability of ₹ 20,000 in respect of B/R discounted with bank, not yet matured.
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