P&lac Exercises Practice

Financial Accounting The following is the trial balance of Gupta as on 30th June ,2001 Trial Balance Of Gupta For The Year Ending 30TH June ,2001 Dr Cash Bank Purchases Return Inwards

Rs 540 2,630 40,675 680

Wages Fuel and Power Carriage on sales Carriage on purchases

8,480 4,730 3,200 2,040

Inventory (1ST July,2001 ) Buildings Freehold land Machinery Patents Salaries General Expenses Insurance Drawings Accounts Receivables

5,760

Rs Sales

98,780

Return Outwards Capital Accounts Payable

500 62,000 6,300

Rent

Cr

9,000

32,000 10,000 20,000 75,000 15,000 3,000 600 5,245 14,500 1,76,580

1,76,580

Taking into account the following adjustments prepare the Trading ,Profit and Loss Account as on 30TH June ,2001. 1. Inventory on hand on 30TH June ,2001 is Rs 6,800 2. Machinery to be depreciated at the rate of 10% and patents at the rate of 20% 3. Salaries for the month of June 2001 amounting to Rs1,500 were unpaid. 4. Insurance includes an annual premium of Rs 170 on a policy expiring on 31ST December ,2001 5. Bad debts to be written of are Rs 725 6. Rent receivableRs1,000.

Financial Accounting Page :176; Illustration:10.6 From the following Trial Balance of Pratibha and company, prepare Trade ,Profit and Loss Account for the year ending 31ST Dacamber,2002 after giving effect to the undermentioned adjustments. Trial balance for the year ending 31ST December ,2002 Dr Opening Stock Purchases Sales Return Carriage Inwards Carriage Outwards Wages Salaries Rent Freight Fire Insurance Premium Bad Debts Discount Printing and Stationary Rates and Taxes Travelling Expenses Sundry Trade Expenses Business Premises Furniture and Fixtures Bills Receivable Sundry Debtors Packing Expenses Loan given to Smith Investments Cash in hand Cash at bank Proprietor’s Withdrawals

RS 8,000 20,000 1,500 1,200 2,500 3,300 5,500 1,100 2,400 900

Capital a\c on 1-1-92 Sales Purchase Return Apprenticeship Premium Bills Payable Sundry Creditors

Cr RS 50,000 80,000 400 1,500 2,500 15,800

2,100 500 250 350 150 200 55,000 2,500 3,000 20,000 4,500 5,000 3,500 250 3,500 3,000 1,50,200

Adjustments to be made for the current period are:

1,50,200

1. Inventory in hand 31ST December,2002,RS 7,000 2. 3. 4.

5. 6. 7. 8.

9. 10. 11. 12. 13. 14.

Wages to laborers of RS 300 for the last month are outstanding. Salaries to the clerk of the month of December ,2002 are outstanding RS 500. Rent for the godown for the last month is outstanding RS100 Fire insurance premium includes RS 600 paid on 17TH July ,2002 to run for one year from 1st July ,2002 TO 30TH June 2003 Apprentice premiums are for three years paid in advance on 1ST Janaury,2002 A stationary for RS 30 remains unpaid and unrecorded. Depreciate business premises by 5% ,Furnitures and Fixtures by 10%and packing Machinery by 10% Interest on Smith’s loan has accrued as on 31ST December ,2002 Interest on investments RS 75 has accrued as on 31ST December ,2002 Interest on capital to be allowed at 5% for the year. Interest on drawings to be charged to him as ascertained for the year RS 80. Create a provision on debtors for doubtful debts 5% and discount at 3%. Create a reserve on creditors for discount at 3%.

Financial Accounting Page :187; Illustration:11.6; The following is the Trial Balance of Rajan Jewelers as on December 31,2005.

Dr.

Cr.

Particulars Opening Inventory Purchases Furniture Motor car Buildings Gangappa Gourishankar Mathews Advertisements Repairs and maintenance General expenses Insurance Cash in hand Cash at bank Salaries

RS 72,000 2,25,000 15,000 30,000 4,25,000 12,000 20,000 18,000 22,000 13,000 16,000 7,000 3,500 6,000 30,000

Particulars Capital Sales Purchase returns Murthy Varadan Commission

9,15,300

RS 5,00,000 3,50,000 1,800 32,000 24,000 7,500

9,15,300

Note: To arrive at accounts receivables and accounts payables you have to add necessary ledger accounts. You are required you draft Profit and Loss accounts and Balance sheet as on 31st December 2005. 1. 2. 3. 4. 5. 6.

Closing Inventory as at 31.12.2005,Rs 80,000. Interest on capital at 6%. Prepaid advertisements RS2,000. Goods used for domestic purpose RS 1,800. Outstanding salaries RS3,000. Depreciation on buildings at 5%,furniture 5%, and Motor car at 10%.

Dr. Sanjay Patankar Page 1.41 Problem 1: Prepare Trading Account as on 31st Dec. 2005. Opening stock Purchases Carriage Inward Freight Return outward Sales Custom Duty Return Inward Closing Stock

5000 22000 1200 1700 2000 51700 2000 700 5300