Chapter 1 Financial Statements I Solutions

Question - 21 : - From the following trial balance of Mr. A. Lal, prepare trading, profit and loss account and balance sheet as on March 31, 2017.

Account Title

Debit Amount Rs

Credit Amount Rs

Stock as on April 01, 2016

16,000

Purchases and Sales

67,600

1,12,000

Returns inwards and outwards

4,600

3,200

Carriage inwards

1,400

General expenses

2,400

Bad debts

600

Discount received

1,400

Bank over draft

10,000

Interest on bank overdraft

600

Commission received

1,800

Insurance and taxes

4,000

Scooter expenses

200

Salaries

8,800

Cash in hand

4,000

Scooter

8,000

Furniture

5,200

Building

65,000

Debtors and Creditors

6,000

16,000

Capital

50,000

Closing stock Rs 15,000.

Answer - 21 : -

Trading Account as on March 31, 2017
Dr.							Cr.
Particulars			Amount Rs	Particulars			Amount Rs
Opening Stock			16,000	Sales		1,12,000
Purchases		67,600			Less: Sales Return Inwards	(4,600)	1,07,400
	Less: Return Outwards	(3,200)	64,400	Closing Stock			15,000
Carriage Inwards			1,400
Profit and Loss (Gross Profit)			40,600

			1,22,400				1,22,400

Profit and Loss Account as on March 31, 2017
Dr.			Cr.
Particulars	Amount Rs	Particulars	Amount Rs
General Expenses	2,400	Trading (Gross Profit)	40,600
Bad Debts	600	Discount Received	1,400
Interest on Bank Overdraft	600	Commission Received	1,800
Insurance and Taxes	4,000
Scooter Expenses	200
Salaries	8,800
Net Profit	27,200
	43,800		43,800

Balance Sheet as on March 31, 2017
Liabilities			Amount Rs	Assets	Amount Rs
Capital		50,000		Building	65,000
	Add: Net Profit	27,200	77,200	Furniture	5,200
				Scooter	8,000
Creditors			16,000	Debtors	6,000
Bank Overdraft			10,000	Closing Stock	15,000
				Cash in Hand	4,000
			1,03,200		1,03,200

Question - 22 : - Prepare trading and profit and loss account and balance sheet of M/s Royal Traders from the following balances as on March 31, 2017.

Debit balances

Amount Rs

Credit balances

Amount Rs

Stock

20,000

Sales

2,45,000

Cash

5,000

Creditors

10,000

Bank

10,000

Bills payable

4,000

Carriage on purchases

1,500

Capital

2,00,000

Purchases

1,90,000

Drawings

9,000

Wages

55,000

Machinery

1,00,000

Debtors

27,000

Postage

300

Sundry expenses

1,700

Rent

4,500

Furniture

35,000

Closing stock Rs 8,000.

Answer - 22 : -

Trading Account as on March 31, 2017
Dr.			Cr.
Particulars	Amount Rs	Particulars	Amount Rs
Opening Stock	20,000	Sales	2,45,000
Purchases	1,90,000	Closing Stock	8,000
Carriage on Purchases	1,500	Profit and Loss (Gross Loss)	13,500
Wages	55,000

	2,66,500		2,66,500

Profit and Loss Account as on March 31, 2017
Dr.			Cr.
Particulars	Amount Rs	Particulars	Amount Rs
Trading (Gross Loss)	13,500
Postage	300
Sundry Expenses	1,700
Rent	4,500	Net Loss	20,000

	20,000		20,000

Balance Sheet of M/s Royal Traders as on March 31, 2017
Liabilities			Amount Rs	Assets	Amount Rs
Capital		2,00,000		Machinery	1,00,000
	Less: Net Loss	(20,000)		Furniture	35,000
	Less: Drawings	(9,000)	1,71,000	Debtors	27,000
				Closing Stock	8,000
Creditors			10,000	Bank	10,000
Bills Payable			4,000	Cash	5,000

			1,85,000		1,85,000

Question - 23 : - Prepare trading and profit and loss account from the following particulars of M/s Neema Traders as on March 31, 2017.

Account Title

Debit Amount
Rs

Account Title

Credit Amount
Rs

Buildings

23,000

Sales

1,80,000

Plant

16,930

Loan

8,000

Carriage inwards

1,000

Bills payable

2,520

Wages

3,300

Bank overdraft

4,720

Purchases

1,64,000

Creditors

8,000

Sales return

1,820

Capital

2,36,000

Opening stock

9,000

Purchases return

1,910

Machinery

2,10,940

Insurance

1,610

Interest

1,100

Bad debts

250

Postage

300

Discount

1,000

Salaries

3,000

Debtors

3,900

Stock on March 31, 2017 Rs 16,000.

Answer - 23 : -

Trading Account as on March 31, 2017
Dr.							Cr.
Liabilities			Amount Rs	Assets			Amount Rs
Opening Stock			9,000	Sales		1,80,000
Purchases		1,64,000			Less: Sales Return	(1,820)	1,78,180
	Less: Purchases Return	(1,910)	1,62,090	Closing Stock			16,000

Carriage Inwards			1,000
Wages			3,300
Profit and Loss (Gross Profit)			18,790

			1,94,180				1,94,180

Profit and Loss Account as on March 31, 2017
Dr.			Cr.
Particulars	Amount Rs	Particulars	Amount Rs
Insurance	1,610	Trading (Gross Profit)	18,790
Interest	1,100
Bad Debts	250
Postage	300
Discount	1,000
Salaries	3,000
Net Profit	11,530
	18,790		18,790

Balance Sheet as on March 31, 2017
Liabilities			Amount Rs	Assets	Amount Rs
Capital		2,36,000		Building	23,000
	Add: Net Profit	11,530	2,47,530	Plant	16,930
				Machinery	2,10,940
Loan			8,000	Debtors	3,900
Creditors			8,000	Closing Stock	16,000
Bills Payable			2,520
Bank Overdraft			4,720

			2,70,770		2,70,770

Question - 24 : - From the following balances of M/s Nilu Sarees as on March 31, 2017. Prepare trading and profit and loss account and balance sheet as on date.

Account Title

Debit Amount Rs

Account Title

Credit Amount
Rs

Opening stock

10,000

Sales

2,28,000

Purchases

78,000

Capital

70,000

Carriage inwards

2,500

Interest

7,000

Salaries

30,000

Commission

8,000

Commission

10,000

Creditors

28,000

Wages

11,000

Bills payable

2,370

Rent and taxes

2,800

Repairs

5,000

Telephone expenses

1,400

Legal charges

1,500

Sundry expenses

2,500

cash in hand

12,000

Debtors

30,000

Machinery

60,000

Investments

90,000

Drawings

18,000

Closing stock, as on March 31, 2017 Rs 22,000.

Answer - 24 : -

Trading Account of M/s Nilu Sarees as on March 31, 2017
Dr.			Cr.
Particulars	Amount Rs	Particulars	Amount Rs
Opening Stock	10,000	Sales	2,28,000
Purchases	78,000	Closing Stock	22,000
Carriage Inwards	2,500
Wages	11,000
Profit and Loss (Gross Profit)	1,48,500

	2,50,000		2,50,000

Profit and Loss Account as on March 31, 2017
Dr.			Cr.
Particulars	Amount Rs	Particulars	Amount Rs
Salaries	30,000	Trading (Gross Profit)	1,48,500
Commission	10,000	Interest	7,000
Rent and Taxes	2,800	Commission	8,000
Repairs	5,000
Telephone Expenses	1,400
Legal Charges	1,500
Sundry Expenses	2,500
Net Profit	1,10,300

	1,63,500		1,63,500

Balance Sheet as on March 31, 2017
Liabilities			Amount Rs	Assets	Amount Rs
Capital		70,000		Machinery	60,000
	Add: Net Profit	1,10,300		Investments	90,000
		1,80,300		Debtors	30,000
	Less: Drawings	(18,000)	1,62,300	Closing Stock	22,000
				Cash in Hand	12,000
Creditors			28,000
Bills Payable			2,370
Suspense			21,330


			2,14,000		2,14,000

Question - 25 : - Prepare trading and profit and loss account of M/s Sports Equipments for the year ended March 31, 2017 and balance sheet as on that date:

Account Title

Debit Amount
Rs

Credit Amount
Rs

Opening stock

50,000

Purchases and sales

3,50,000

4,21,000

Sales returns

5,000

Capital

3,00,000

Commission

4,000

Creditors

1,00,000

Bank overdraft

28,000

Cash in hand

32,000

Furniture

1,28,000

Debtors

1,40,000

Plants

60,000

Carriage on purchases

12,000

Wages

8,000

Rent

15,000

Bad debts

7,000

Drawings

24,000

Stationery

6,000

Travelling expenses

2,000

Insurance

7,000

Discount

5,000

Office expenses

2,000

Closing stock as on March 31, 2017 Rs 2,500

Answer - 25 : -

Trading Account as on March 31, 2017
Dr.		Cr.
Particulars	Amount Rs	Particulars				Amount Rs
Opening Stock	50,000	Sales		4,21,000
Purchases	3,50,000		Less: Sales Return		5,000	4,16,000
Carriage on Purchases	12,000	Closing Stock				2,500
Wages	8,000	Profit and Loss (Gross Loss)				1,500
	4,20,000					4,20,000

Profit and Loss Account as on March 31, 2017
Dr.			Cr.
Particulars	Amount Rs	Particulars	Amount Rs
Trading (Gross Loss)	1,500	Commission	4,000
Rent	15,000	Net Loss	41,500
Bad Debts	7,000
Stationery	6,000
Travelling Expenses	2,000
Insurance	7,000
Discount	5,000
Office Expenses	2,000

	45,500		45,500

Balance Sheet as on March 31, 2017
Liabilities			Amount Rs	Assets	Amount Rs
Capital		3,00,000		Plants	60,000
	Less: Net Loss	(41,500)		Furniture	1,28,000
	Less: Drawings	(24,000)	2,34,500	Debtors	1,40,000
				Closing Stock	2,500
Creditors			1,00,000	Cash in Hand	32,000
Bank Overdraft			28,000

			3,62,500		3,62,500

Free - Previous Years Question Papers

Account Title	Debit Amount Rs	Credit Amount Rs
Stock as on April 01, 2016	16,000
Purchases and Sales	67,600	1,12,000
Returns inwards and outwards	4,600	3,200
Carriage inwards	1,400
General expenses	2,400
Bad debts	600
Discount received		1,400
Bank over draft		10,000
Interest on bank overdraft	600
Commission received		1,800
Insurance and taxes	4,000
Scooter expenses	200
Salaries	8,800
Cash in hand	4,000
Scooter	8,000
Furniture	5,200
Building	65,000
Debtors and Creditors	6,000	16,000
Capital		50,000

Debit balances	Amount Rs	Credit balances	Amount Rs
Stock	20,000	Sales	2,45,000
Cash	5,000	Creditors	10,000
Bank	10,000	Bills payable	4,000
Carriage on purchases	1,500	Capital	2,00,000
Purchases	1,90,000
Drawings	9,000
Wages	55,000
Machinery	1,00,000
Debtors	27,000
Postage	300
Sundry expenses	1,700
Rent	4,500
Furniture	35,000

Account Title	Debit Amount Rs	Account Title	Credit Amount Rs
Buildings	23,000	Sales	1,80,000
Plant	16,930	Loan	8,000
Carriage inwards	1,000	Bills payable	2,520
Wages	3,300	Bank overdraft	4,720
Purchases	1,64,000	Creditors	8,000
Sales return	1,820	Capital	2,36,000
Opening stock	9,000	Purchases return	1,910
Machinery	2,10,940
Insurance	1,610
Interest	1,100
Bad debts	250
Postage	300
Discount	1,000
Salaries	3,000
Debtors	3,900

Chapter 1 Financial Statements I Solutions

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