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Question -

Prepare the trading and profit and loss account and balance sheet of M/s Control Device India on March 31, 2017 from the following balance as on that date.

Account Title

Debit

Amount

₹

Credit

Amount

₹

Drawings and Capital

19,530

67,500

Purchase and Sales

45,000

1,12,500

Salary and Commission

25,470

1,575

Carriage

2,700

 

Plant and Machinery

27,000

 

Furniture

6,750

 

Opening stock

42,300

 

Insurance premium

2,700

 

Interest

 

7,425

Bank overdraft

 

24,660

Rent and Taxes

2,160

 

Wages

11,215

 

Returns

2,385

1,440

Carriage outwards

1,485

 

Debtors and Creditors

36,000

58,500

General expenses

6,975

 

Octroi

530

 

Investment

41,400

 

 

2,73,600

2,73,600
Closing stock was valued ₹ 20,000.
(a) Interest on capital @ 10%.
(b) Interest on drawings @ 5%.
(c) Wages outstanding ₹ 50.
(d) Outstanding salary ₹ 20.
(e) Provide a depreciation @ 5% on plant and machinery.
(f) Make a 5% provision on debtors.



Answer -

Trading Account

Dr.

Cr.

Particulars

Amount

₹

Particulars

Amount

₹

Opening Stock

42,300

Sales

1,12,500

Purchases

45,000

Less: Sales Return

2,385

1,10,115

Less: Purchases Return

1,440

43,560

Closing Stock

20,000

Carriage

2,700

Wages

11,215

Add: Outstanding Wages

50

11,265

Octroi

530

Gross Profit

29,760

1,30,115

1,30,115

Balance Sheet

Liabilities

Amount

₹

Assets

Amount

₹

Capital

67,500

Plant and Machinery

27,000

Add: Interest on Capital

6,750

Less: Depreciation

1,350

25,650

Less: Net Loss

8,973

Furniture

6,750

Less: Drawings

19,530

Debtors

36,000

Less: Interest on Drawings

977

44,770

Less: New Provision

1,800

34,200

Bank Overdraft

24,660

Investment

41,400

Creditors

58,500

Closing Stock

20,000

Outstanding Wages

50

Salary Outstanding

20

1,28,000

1,28,000

 

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