Q) From the following extracts of Trial Balance as on 31/3/2003 and other additional information, prepare Profit and Loss Account and Balance Sheet.
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Plant & Machinery
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40500
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Bad Debt
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2200
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Furniture and Fittings
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15250
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Bad Debts Recovered
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1250
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Bank Overdraft
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160000
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Salaries
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32650
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Capital
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115000
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Salary Payable
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5350
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Drawings
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15000
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Prepaid Rent
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500
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Purchases
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230500
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Rent
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6500
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Opening Stock
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132250
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Carriage Inward
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2350
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Wages
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22325
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Carriage Outward
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3250
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Provisions for Doubtful Debts
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5700
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Sales
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290600
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Provision for Discount on Debtors
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1375
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Advertisement Expenses
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6750
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Sundry Debtors
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152500
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Printing & Stationery
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2200
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Sundry Creditors
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77500
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Cash in Hand
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2300
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Cash at Bank
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7250
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Additional Information:
Difference in the trial balance, if any, can be taken as miscellaneous expenses or income.
Bank overdraft is secured against hypothecation of stock. The Bank overdraft outstanding as on 31/3/2003 accounted for 80% of drawing power. Such power is ascertained by deducting 20% as margin from the value of stock as on that date.
Purchase include sales return of Rs.5500/- and sales include purchase returns of Rs. 4750/-.
Goods withdrawn by the owner for own consumption amounts Rs.7500/- included in purchases.
Wages paid for installation of plant and machinery amounting to Rs.750/- were included in wages account.
Depreciation is to be provided on plant and machinery @ 15% p.a. and on furniture and fittings @ 10% p.a.
Create a provision for doubtful debts @ 5% and provision for discount on debtors @2.5% .
A debit balance of Rs.2500/- in the account of Ram, a creditor is included in the list of sundry Creditors.
Free samples distributed for publicity costing Rs.1250/-