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Financial Statements of Sole Proprietorship ...                                18.5

                     Solution:
                                  TRADING AND PROFIT & LOSS ACCOUNT for the year ended 31st March, 2024
                     Particulars                         `      Particulars                         `
                     To  Opening Stock                  40,000   By  Sales              1,27,500
                     To  Purchases             60,000              Less: Sales Return     2,000   1,25,500
                        Less: Purchases Return   1,275   58,725   By  Closing Stock                35,000
                     To  Wages                          10,000
                     To  Freight In                      1,000
                     To  Gross Profit c/d               50,775
                                                       1,60,500                                  1,60,500
                     To  Discount Allowed                 350   By  Gross Profit b/d               50,775
                     To  Bank charges                     100   By  Discount Received                800
                     To  Salaries                        7,000
                     To  Freight out                     1,200
                     To  Rent                            2,000
                     To  Advertisement                   2,000
                     To  Net Profit transferred to
                        Capital A/c                     38,925
                                                        51,575                                     51,575

                                                BALANCE SHEET as at 31st March, 2024
                     Liabilities                         `      Assets                             `
                     Sundry Creditors                   25,000   Cash at Bank                      7,000
                     Capital:                                   Sundry Debtors                     45,000
                     Opening Balance          1,13,075          Closing Stock                      35,000
                     Add: Net Profit           38,925   1,52,000   Plant and Machinery             90,000
                                                       1,77,000                                  1,77,000


                     8.  From the following information of a trader, prepare his Profit & Loss Account for
                        the year ended 31st March, 2024:
                     Particulars                                                                   `
                     Gross Profit        .................................................................................................................................................................  5,00,000
                     Salaries and Wages   .................................................................................................................................................................  12,000
                     Discount Allowed    .................................................................................................................................................................  3,000
                     Interest Received   .................................................................................................................................................................  2,000
                     Commission Paid     .................................................................................................................................................................  14,000
                     Freight Outwards    .................................................................................................................................................................  15,000
                     Rent Received       .................................................................................................................................................................  12,500
                     Entertainment Expenses   .................................................................................................................................................................  8,000
                     Sales Promotion Expenses   .................................................................................................................................................................  4,250
                     Audit Fees          .................................................................................................................................................................  8,500
                     Miscellaneous Income   .................................................................................................................................................................  12,900
                     Repairs and Maintenance   .................................................................................................................................................................  3,400
                     Water and Electricity Charges (Office) .................................................................................................................................................  3,000
                     Telephone Expenses   .................................................................................................................................................................  6,000
                     Gain on Sale of Machine   .................................................................................................................................................................  600
                     Loss by Theft       .................................................................................................................................................................  1,000
                     Legal Expenses      .................................................................................................................................................................  11,250
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