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11th Standard CBSE Accountancy - Final Accounts with Adjustments Six Marks Questions

Published on: 08/10/2019

Final Accounts with Adjustments

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Questions:

Generic 6

10 x 6 = 60

From the following balances for the year ended 31 March, 2014 and additional information, prepare Trading and Profit and Loss Account and Balance Sheet of Mis Ram Lal and Sons:

Capital	80,000	Insurance	600
Purchases	82,000	Salaries	12,500
Sales	1,10,000	Bad debts	200
Returns outward	1,000	Carriage on Purchase	200
Building	45,000	Commission (Cr.)	1,500
Opening stock	15,000	Cash-in-hand	5,000
Debtors	20,100	Cash at bank	25,000
Creditors	28,000	Computer	1,500
Furniture	7,000	Interest on Investment	500
Wages	1,800
Rent	5,100

Additional information:
(i) Closing stock was valued as Rs 20,000
(ii) Provide depreciation on building @ 5% and on furniture @ 10%
(ill) Outstanding salaries Rs 1,000
(iv) Unexpired (prepaid) insurance Rs 50
(v) Accrued commission Rs 300
(vi) Provide for Manager's Commission at 5% on Net Profit after charging such commission.

Prepare Trading and Profit & Loss Account for the year ending 31^st March, 2015 and a Balance Sheet as on that date from the following Trial Balance:

Name of Accounts	Amount (Rs)	Name of Accounts	Amount (Rs)
Drawings	9,000	Sales	3,20,000
Plants & Fixtures	16,000	Sundry Creditors	24,000
Purchases	2,32,000	Capital	80,000
Carriage Inward	4,000	Bills Payable	18,000
Wages	16,000
Returns Inward	8,000
Salaries	20,000
Printing	1,600
Advertising	2,400
Trade Charges	1,200
Rent	2,800
Debtors	50,000
Bills Receivable	10,000
Investments	30,000
Discount	1,000
Cash at Bank	32,000
Cash-in-Hand	6,000
	4,42,000		4,42,000

Adjustments :
(i) Closing Stock was Rs 52,000
(ii) Rs 1,000were as bad debts and Provision for doubtful debts be created on sundry debtors @5%
(ill) Interest on capital is to be provided @ 6%p.a.
(iv) An additional capital of Rs 20,000 introduced by proprietor on 1^st Oct., 2014.
(v) Plant & Fixtures to be depreciated by 10% p.a.
(vi) Salaries outstanding on 31st March, 2015 amounted to Rs 1,000.
(vii) Accrued Interest on investment amounted to 1,500

Prepare a Trading and Profit and Loss Account for the year ending 31^st March, 2015 from the balances extracted from M/s Harikrishan. Also prepare a Balance Sheet at the end of the year.

Account Title	Amount (Rs)	Account title	Amount (Rs)
Cash-in-Hand	1,080	Sales	1,97,560
Cash at Bank	5,260	Returns Outward	1,000
Purchases	81,350	Capital	1,24,000
Returns Inward	1,360	Sundry Creditors	12,600
Wages	16,960	Rent Received	18,000
Fuel & Power	9,460
Carriage on Sales	6,400
Carriage on Purchase	4,080
Opening Stock	11,520
Building	64,000
Freehold Land	20,000
Machinery	40,000
Salaries	30,000
Patents	15,000
General Expenses	6,000
Insurance	1,200
Drawings	10,490
Sundry Debtors	29,000

Adjustments :
(i) Machinery is to be depreciated @ 10% and Patents @ 20%.
(ii) Insurance includes a premium of Rs 340 on policy expiring on 30^th September, 2015.
(iii) Salaries for the month of March 2015 amounting to Rs 3,000 were outstanding.
(iv) Further bad debts Rs 1,450. Provision for bad debts @ 5% on debtors.
(v) Rent Receivable Rs 2,000.
(vi) Closing Stock Rs 13,600.

Following are balances from the trial balance of Mukesh Traders on 31st march, 2016:

Particulars	(Rs)	Particulars	(Rs)
Wages	1,20,000	Land and Building	10,00,000
Sales	3,75,000	Interest on investments	7,400
Freight on Purchase	650	Cash-in-hand	26,400
Salaries	7,500	Investments	6,00,000
Drawings	6,100	Capital Account	13,47,000
Repair to Machinery	1,800	Bills Payable	4,500
Duty on Import of Goods	4,100	Plant and Machinery	1,82,000
Customer's A/c	16,200	X's Loan (Cr.)	18,600
Postage	1,600	Discount Received	500
Opening Stock	6,700	Discount Allowed	1,500
Carriage Inward	1,000	Bank Overdraft	3,40,000
Insurance	2,800	Loan (Cr.)	11,000
Trade Expenses	1,450	Supplier's A/c	40,000
Purchases	1,57,200	Bills Receivable	7,000

Prepare Trading and Profit & Loss Account for the year ended 31st March, 2016 and Balance Sheet as at that date after taking into account the following adjustments :
(i) Closing Stock was valued at Rs 20,000.
(ii) Insurance was prepaid Rs 1,000.
(iii) Write off Rs 2,000 as Bad debt.
(iv) Depreciation to be provided on Land and Building @ 5% p.a. and on Plant and Machinery @ 10% p.a.
(v) Create provision for doubtful debts @ 5% on debtors.
(vi) Wages include Rs 4,800 for installation of a new machinery.

The following are the balances extracted from the book of Rajan on 31st March, 2013.

Particulars	Amount (Rs)	Particulars	Amount (Rs)
Rajan's capital	30,000	Sales	1,50,000
Raajan's Drawings	5,000	Sales return	2,000
Furniture and fitting	2,600	Discount (Dr.)	1,600
Bank Overdraft	4,200	Discount (Cr.)	2,000
Creditors	13,800
Business Premises	20,000	Taxes & Insurance	2,000
Stock (1.4.2012)	22,000	General Expenses	4,000
Debtors	18,000	Salaries	9,000
Rent from Tenants	1,000	Commission (Dr.)	2,200
Carriage on Purchases	1,800	Bad Debts	800
Purchases	1,10,000

Additional Information:
(i) Stock on hand on 31st March 2013 was Rs 20,060
(ii) Write off Depreciation: business premises Rs 300, Furniture and fittings Rs 250
(iii) Making a provision of 5% on Debtors for Doubtful debts.
(iv) Carry forward Rs 200 for unexpired Insurance.
(v) Outstanding salary Rs 1,500
Prepare Trading and profit & Loss Nc for the year ended March 31, 2013 and a Balance sheet as on that date.

Following is the Trial Balance extracted from the books of Aashima Mehra on 31^st March, 2016:

Particulars	Debit Amount (Rs)	Credit Amount (Rs)
Cash-in -hand	2,050	-
Purchases and Sales	16,500	47,000
Returns	500	300
Commission	-	1,200
Advertising	1,450	-
Bank overdraft	-	10,500
Bad debts	450	-
Interest	350	-
Motor Vehicles	19,750	-
Furniture and Fittings	1,900	-
Building	25,500	-
Capital	-	38,500
Wages	2,500	-
General Expenses	3,500	-
Taxes and Insurance	4,050	-
Provision for Bad Debts	-	700
Sundry Debtors and Creditors	12,000	9,800
Stock on (1^stApril, 2015	11,000	-
Salaries	6,500	-
	1,08,000	1,08,000

Adjustments :
(i) Salaries Rs 800 and Taxes Rs 550 are outstanding.
(ii) Depreciation on Building @ 5% , Furniture and Fittings @ 10% and Motor Vehicle @ 20% .
(iii) Rs 450 is due for interest on bank overdraft.
(iv) One third of the commission received is in respect of work to be done in the next year.
(v) Stock in hand on 31st March, 2016 was Rs 11,000.
(vi) Write off further Rs 300 as Bad debts and provision made further 5% on Sundry Debtors.
Prepare Trading and Profit & Loss Account for the year ending 31st March, 2016 and Balance Sheet as at that date.

A trader maintained provision for doubtful debts @ 20.% and a provision for discount 1% on debtors which on 1^st April, 2012 stood at Rs 1,500 and Rs 500 respectively. His balances on 31.03.2013 and on 31.03.2014 were as
follows:

Particulars	31.03.2013 (Rs)	31.03.2014 (Rs)
Bad debts written off	1,800	300
Discount allowed	600	200
Sundry debtors	40,000	12,000

Required: Prepare Bad Debts A/c, Provision for Doubtful Debts A/c, Discount Allowed A/c, Provision for Discount on Debtors A/c and Profit & Loss A/c.

Show the treatment of the following items in the Profit and Loss Account and Balance Sheet:

Particulars	Debit (Rs)	Credit (Rs)
Debtors	40,300	-
Provision for doubtful debts	-	2,000
Bad debts	700	-

Adjustments :
(i) There was further bad debts of Rs 300.
(ii) Make a provision for doubtful debts @ 5%.
(ill) Create discount on debtors @ 2%.

Show the effect of the following information in the Profit & loss Account and Balance Sheet, being prepared on March 31, 2014 :

Particulars	Debit (Rs)	Credit (Rs)
Salaries	5,000	-
Establishment Expenses	7,700	-
Wages Owing	-	250
Unexpired Insurance	300	-
Rent	22,000	-
Plant and Machinery	50,000	-
Land and Building	80,000	-

Adjustments :
(i) Outstanding salaries amounted to Rs 1,000.
(ii) Prepaid rent amounted to Rs 2,000.
(iii) The value of plant and machinery be decreased by 10%.
(iv) The value of land and building be increased by 20%.
(v) Establishment expenses for Rs 700 are still to be paid.

10.

From the following Trial Balance of Rohit Sharma, prepare Trading and Profit & Loss Account for the year ending 31^st March 2016 and a Balance Sheet on the same date after making necessary adjustments :

Name of Account	Debit Amount (Rs.)	Credit Amount (Rs.)
Stock on 01 April, 2015	12,000	-----
Capital	-----	62,000
Purchases	40,000	-----
Discount Received	-----	400
Sales	-----	86,000
Sales Returns	6,000	-----
Building	50,000	-----
Debtors	16,000	-----
Salaries	2,400	-----
Office Expenses	1,200	-----
Wages	10,000	-----
Purchases Returns	-----	4,000
Interest	-----	800
Travelling Expenses	400	-----
Fire Insurance	800	-----
Machinery	20,000	-----
Carriage Inward	700	-----
Commission	500	-----
Cash-in-hand	2,500	-----
Rent and Taxes	1,800	-----
Creditors	-----	10,800
	1,64,000	1,64,000

Adjustments :
1. Closing stock was Rs. 16,000.
2. Wages Rs.2,000 and salaries Rs.1,200 are outstanding.
3. Rent for two months at the rate of Rs.500 per month is outstanding.
4. Depreciation Building by 5% and Machinery by 10%.
5. Prepaid insurance Rs. 200.

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Answers Key:

Generic 6

10 x 6 = 60

Dr. Trading and Profit and Loss Accout for the year ended 31.03.2014
Particulars		Amount (Rs)	Particulars		Amount (Rs)
To Opening Stock		15,000	By Sales		1,10,000
To Purchase	82,000		By Closing Stock		20,000
Less: Returns outward	1,000	81,000
To Carriage Inward		200
To Wages		1,800
To Gross Profit c/d		32,000
		130,000			130,000
To Rent		5,100	By Gross Profit b/d		32,000
To Insurance	600		By Commission	1,500
Less : Prepaid Insurance	50	550	Add: Accrued Commission	300	1,800
To Salaries	12,500		By Interest on Investment		500
Add: Outstanding Salary	1,000	13,500
To Bad Debts		200
To Depreciation on Building		2,250
To Depreciation on Furniture		700
To Manager's Commission		571
To Net Profit		11,429
		34,300			34,300

Balance Sheet as on 31.03.2014
Liabilities		Amount	Assets		Amount
Capital	80,000		Building	45,000
Add: Net Profit	11,429	91,429	Less: Depreciation	2,250	42,750
Creditors		28,000	Furniture	7,000
Outstanding Salaries		1,000	Less: Depreciation	700	6,300
Outstanding Manager's Commission		571	Computer		1,500
			Debtors		20,100
			Closing Stock		20,000
			Cash-in-hand		5,000
			Cashin Bank		25,000
			Prepaid Insurance		50
			Accrued Commission		300
		1,21,000			1,21,000

Dr. Trading and Profit and Loss A/c for the year ended 31st March, 2015 Cr.
Particulars		Amount (Rs)	Particulars		Amount (Rs)
To Purchases		2,32,000	By Sales
To Carriage Inward		4,000	Less : Returns	3,20,000
To Wages		16,000		8,000	3,12,000
To Gross Profit c/d		1,12,000	By Closing Stock		52,000
		3,64,000			3,64,000
To Bad Debts		1,000	By Gross Profit b/d		1,12,000
To Provision for bad debts		2,450	By Accrued Interest on Investment		1,500
To Interest on Capital		4,200
To Depreciation on Plant & Fixtures		1,600
To Salaries	20,000
Add: Salaries	1,000	21,000
To Printing		1,600
To Advertising		2,400
To Trade Charges		1,200
To Rent		2,800
To Discount		1,000
To Net Profit c/d		74,250
		1,13,500			1,13,500

Balance Sheet as at 31 st March, 2015
Liabilities		Amount(Rs)	Assets		Amount (Rs)
Sundry Creditors		24,000	Plant and Fixture	16,000
Capital	80,000		Less: Depreciation	1,600	14,400
Add: Net Profit	74,250		Debtors	50,000
Add: Interest on capital	4,200		Less : Bad debts	1,000
Less: Drawing	9,000	1,49,450	Less : Provision	2,450	46,550
Bills Payable		18,000	Investment	30,000
Outstanding Salary		1,000	Add: Acc. Int.	1,500	31,500
			Cash at Bank		32,000
			Cash-in-hand		6,000
			Bills Receivable		10,000
			Closing Stock		52,000
		1,92,450			1,92,450

Dr. Trading and Profit and Loss Account for the year end 31st March - 2015 Cr.
Particulars		Amount (Rs)	Particulars		Amount (Rs)
To Opening Stock		11,520	By Sales	1,97,560
To Purchases	8,350		Less: Returns Inward	1,360	1,96,200
Less: Returns Outward	1,000	80,350	By Closing Stock		13,600
To Wages		16,960
To Fuel & Power		9,460
To Carriage on Purchase		4,080
To Gross Profit c/d		87,430
		2,09,800			2,09,800
To Carriage On Sales		6,400	By Gross Profit b/d		87,430
To Salaries	30,000		By Rent	18,000
Add: O/s Salary	3,000	33,000	Add: Rent Receivable	2,000	20,000
To General Expenses		6,000
To Insurance	1,200
Less: Unexpired Insurance	170	1,030
To Depreciation:
Machinery	4,000
Patents	3,000	7,000
To Bad Debts		1,450
To Provision for Bad Debts (5% on Rs 27,550)		1,378
To Net Profit transferred to Capital A/c		51,172
		1,07,430			1,07,430

Balance Sheet as at 31st March 2015
Liabilities		Amount(Rs)	Assets		Amount (Rs)
Sundry Creditors		12,600	Cash-in-hand		1,080
Salary Outstanding		3,000	Cash at Bank		5,260
Capital :			Closing Stock		13,600
Balance	1,24,000		Sundry Debtors	29,000
Add: Net Profit	51,172		Less: Bad Debts	1,450
	1,75,172			27,550
Less: Drawing	10,490	1,64,682	Less: Provision for Bad debts	1,378	26,172
			Rent Receivable		2,000
			Unexpired Insurance		170
			Patents	15,000
			Less: Depreciation	3,000	12,000
			Freehold Land		20,000
			Building		64,000
			Machinery	40,000
			Less: Depreciation	4,000	36,000
		1,80,282			1,80,282

Dr. Trading Account for the year ended 31st March, 2016 Cr.
particulars	Amount	Particulars	Amount
To Opening Stock	6,700	By Sales	3,75,000
To Purchases	1,57,200	By Stock	20,000
To Carriage Inward	1,000
To Wages (1,20,000 - 4,800	1,15,200
To Freight	650
To Import Duty	4,100
To Gross Profit c/d	1,10,150
	3,95,000		3,95,000

Dr. Profit and Loss Account for the year ended 31st March, 2016 Cr.
Particulars	Amount	Particulars	Amount
To Salaries	7,500	By Gross Profit b/d	1,10,150
To Repair	1,800	By Int. on Investment	7,400
To Postage	1,600	By Discount Received	500
To Insurance (2,800-1,000)	1,800
To Trade Exp.	1,450
To Discount Allowed	1,500
To Bad Debts	2,000
To Bad Debts Provision	710
To Dep. on Land & Building	50,000
To Dep. on Plant & Machinery	18,680
To Net Profit	31,010
	1,18,050		1,18,050

Dr. Balance Sheet as on 31st March, 2016 Cr.
Liabilities		Amount	Assets	Amount
Capital	13,47,000		Customers Account^#	13,490
Add: Profit	31,010		Land & Building less Depreciation	9,50,000
	13,78,010		Investment	6,00,000
Less: Drawings	6,100	13,71,910	Cash	26,400
Bills Payable		4,500	Plant & Machinery^*	1,68,120
X's Loan		18,600	B/R	7,000
Bank Overdraft		3,40,000	Stock	20,000
Loan		11,000	Prepaid Insurance	1,000
Suppliers		40,000
		17,86,010		17,86,010

Dr. Trading and Profit and Loss account for the year end on March 31, 2013 Cr.
Particulars		Amount (Rs)	Particulars		Amount (Rs)
To Opening Stock		22,000	By Sales	1,50,000
To Purchases		1,10,000	Less : Returns	2,000	1,48,000
To Carriage on Purchase		1,800	By Closing Stock		20,060
To Gross Profit		34,260
		1,68,060			1,68,060

To Depreciation on			By Gross Profit		34,260
Business premiss	300		By Rent from tenants		1,000
Furniture & Fittings	250	550	By Discount		2,000
To Bad Debts	800
Add: Provision	900	1,700
To Taxes & Insurance	2,000
Less: Unexpired	200
To Salaries	9000
Add: Outstanding	1,500	10,500
To Discount		1,600
To General Expenses		4,000
To Commission		2,200
To Net Profit		14,910
		37,260			37,260

Balnace Sheet as on 31st March, 2013
Liabilities		Amount	Assets		Amount
Outstanding Salary		1,500	Stock		20,060
Capital	30,000		Business Premium	20,000
Less: Drawings	5,000		Less: Dep.	300	19,700
	25,000		Furniture & Fitting	2,600
Add: Net Profit	14,910	39,910	Less: Dep.	250	2,350
Bank Overdraft		4,200	Debtors	18,000
Creditors		13,800	Less : Provision	900	17,100
			Unexpired Insurance		200
		59,410			59,410

Dr. Trading Account for the year ended March 31, 2016
Particular		Amount (Rs)	particulars		Amount (Rs)
To Stock		11,000	By Sales	47,000
To Purchases	16,500		Less : Sales Returns	500	46,500
Less : Returns	300	16,200	By Stock		11,000
To Wages		2,500
To Gross Profit c/d		27,800
		57,500			57,500

Dr. Profit & Loss Account for the year ended March 31, 2016 Cr.
Particulars	Amount (Rs)	Particulars		Amount (Rs)
To Advertisement	1,450	By Gross Profit b/d		27,800
To Interest (350 + 450)	800	By Commission	1,200
To Gen. Exp.	3,500	Less: Advance	400	800
To Taxes (4,050 + 550)	4,600
To Salaries (6,500 + 800)	7,300
To Dep. on Building	1,275
To Dep. on Furniture	190
To Dep. on Motor	3,950
To Bad Debts Provision^*	635
To Net Profit	4,900
	28,600			28,600

Balance Sheet as at 31 March, 2016
Liabilities		Amount (Rs)	Assets	Amount (Rs)
Capital	38,500	43,400	Cash	2,050
(+) Net Profit	4,900		Motor (less Dep.)	15,800
Bank overdraft (10,500 + 450)		10,950	Furniture (less Dep.)	1,710
Creditors		9,800	Building (less Dep.)	24,225
Salaries outstanding		800	Debtors (12,000 - 300 - 585)	11,115
Taxes outstanding		550	Stock	11,000
Advance commission		400
		65,900		65,900

Dr. In the Books of..... Bad Debts Account Cr.
Date	Particulars	Amount (rs)	Date	Particulars	Amount (Rs)
31.3.313	To Sundry Debtors A/c	1,800	31.3.13	By Provision for Doubtful Debts A/c	1,800
		1,800			1,800
31.3.14	To Sundry Debtors A/c	300	31.3.14	By Provision for Doubt Debts A/c	300
		300			300

Dr. Provision for Doubtful Debts Account Cr.
Date	Particulars	Amount (Rs)	Date	Particulars	amount (Rs)
31.3.13	To Bad Debts A/c	1,800	01.4.12	By Balance b/d	1,500
31.3.13	To Balance c/d		31.3.13	By Profit and Loss A/c	1,300
	(\({ 2\frac { 1 }{ 2 } }\)% of Rs 40,000)	1,000
		2,800			2,800
31.3.14	To Bad Debts A/c	300	01.4.13	By Balance b/d	1,000
	To P and L A/c	400
	To Balance c/d
	(\({ 2\frac { 1 }{ 2 } }\)% of Rs 12,000)	300
		1,000			1,000

Dr. Discount Allowed Account Cr.
Date	Particulars	Amount (Rs)	Date	Particulars	Amount (Rs)
31.3.13	To Sundry Debtors A/c	600	31.3.13	By Provision for Dis. on debtors A/c	600
		600			600
31.3.14	To Sundry Debtors A/c	200	31.3.14	By Provision for Discount on Debtors A/c	200
		200			200

Dr. Provision for Discount on Debtors Account Cr.
Date	Particulars	Amount (Rs)	Date	Particulars	Amount (Rs)
31.3.2013	To Discount Allowed A/c	600	01.4.12	By Balance b/d	500
31.3.2013	To Balance c/d
	(1% on Rs 39,000)	390	31.3.13	By Profit and Loss A/c	490
		990			990
31.3.2014	To Discount allowed A/c	200	01.4.13	By Balance b/d	390
	To Profit and Loss a/c	73
	To Balance c/d
	(1% on Rs 11,700)	117
		390			390

Dr. Profit and Loss Account (extract) for the year ending on 31 March, 2013 Cr.
Particulars		Amount (Rs)
To Bad Debts	1,800
Add: Provision for Doubtful Debts	1,000
	2,800
Less : Old Provision	1,500	1,300
To Discount Allowed	600
Add : Provision for discount on debtors	390
	990
Less : Old Provision	500	490

Dr. Profit & Loss Account (Extract) for the year ending on 31st March, 2014 Cr.
Particulars		Amount (Rs)	Particulars	Amount (Rs)
To Bad Debts	300		By Proviosn for doubtful Debts	1,000
Add : Provision for Doubtful Debts	300	600	By Provision for Discount on Debtors (old)	390
To Discount allowed	200
Add : Provision for Discount on Debtos	117	317

Dr. Profit & Loss Account (Extract) forr the year ended........ Cr.
Particulars		Amount (Rs)
To Bad debts	700
Add : Further bad debts	300
Add: Provision for doubtful debts (New reserve)	2,000
Add : Discount on debtors	760
	3,760
Less : Provison for doubtful debts (old reserve)	2.000	1,760

Balance Sheet (Extract) as at .......
Assets		Amount (rs)
Debtors	40,300
Less : Further Bad Debts	300
Less : Provision for doubtful debts	2,000
Less : Discount on debtos	760	37,240

Calculation of Provision for Doubtful debts:
5% on Rs 40,000, i.e., (Rs 40,300 - Rs 300) = Rs 40,000 \(\times\) 5/100 = Rs 2,000
Discount on debtors :
2% on Rs 38,000, i.e., Rs 40,300 - (Rs 300 + Rs 2,000) = Rs 38,000 \(\times\) 2/100 = Rs 760.

Dr. In the Books of .... Profit & Loss Account 9Extract) for the year ended March 31, 2014 Cr.
Particulars		Amount (Rs)	Particulars	Amount (Rs)
To Salaries	5,000		By Increase in the value of Land and Building	16,000
Add: Outstanding Salaries	1,000	6,000
To Rent	22,000
Less: Prepaid Rent	2,000	20,000
To Establishment
Expense	7,700
Add: Outstanding Establishment expenses	700	8,400
To Depreciation on Plant and Machinery		5,000

Balance Sheet (Extract) as on March 31, 2014
Liabilities	Amount (Rs)	Assets		Amount (Rs)
Wages Owing	250	Unexpired Insurance		300
Outstanding Salaries	1,000	Prepaid Rent		2,000
Outstanding Establishment Expenses	700	Plant and Machinery	50,000
		Less: Depreciation	5,000	45,000
		Land and Building	80,000
		Add: Increase in the value	16,000	96,000

10.

Dr. Trading and Profit & Loss Account for the year ending on 31st March, 2016 Cr.

Particulars		Amount (Rs.)	Particulars		Amount(Rs.)
To Opening Stock		12,000	By Sales	86,000
To Purchases	40,000		Less: Sales Returns	6,000	80,000
Less: Purchases Returns	4,000	36,000	By Closing Stock		16,000
To Wages	10,000
Add: Out. Wages	2,000	12,000
To Carriage Inward		700
To Gross Profit c/d		35,300
		96,000			96,000
To Salaries	2,400		By Gross Profit bid		35,300
Add: Outstanding Salaries	1,200	3,600	By Discount Received		400
To Rent and Taxes	1,800		By Interest		800
Add: Outstanding Rent	1,000	2,800
To Dep. on Building		2,500
To Dep. on Machinery		2,000
To Insurance	800
Less: Prepaid Insurance	200	600
To Office Expenses		1,200
To Travelling Expenses		400
To Commission		400
To Net Profit		23,000
		36,500			36,500

Balance Sheet as at March 31, 2016

Liabilities		Amount (Rs.)	Assets		Amount (Rs.)
Outstanding Salary		1,200	Closing Stock		16,000
Outstanding Wages		2,000	Building	50,000
Outstanding Rent		1,000	Less: Depreciation 5%	2,500	47,500
Creditors		10,800	Machinery	20,000
Capital	62,000		Less: Depreciation 5%	2,000	18,000
Add: Net Profit	23,000	85,000	Prepaid Insurance		200
			Debtors		16,000
			Cash-in-hand		2,300
		1,00,000			1,00,000