Page 180 - ISCDEBK-XI

Final Accounts—With Adjustments 20.13
Solution: TRADING AND PROFIT & LOSS ACCOUNT for the year ended 31st March, 2022
Particulars ` Particulars `
To Opening Stock 80,000 By Sales 25,00,000
To Purchases 16,20,000 By Closing Stock 2,25,000
Less: Drawings
(Goods for Personal Use) 5,000 16,15,000
To Freight on Purchases 15,000
To Wages 1,10,000
To Gross Profit c/d 9,05,000
27,25,000 27,25,000
To Depreciation: By Gross Profit b/d 9,05,000
Building 25,000 By Discount Received 14,500
Machinery (WN 2) 11,000 By Bad Debts Recovered 6,000
Furniture 4,000 40,000 By Interest Accrued on Investments 18,000
To Salaries 1,00,000
To Travelling Expenses 23,000
To Miscellaneous Expenses 35,000
To Printing and Stationery 27,000
To Advertisement Expenses 25,000
To Postage and Telegrams 13,000
To Discount Allowed 7,600
To Provision for Doubtful Debts (WN 1) 10,000
To Manager’s Commission Outstanding 31,567
(5/105 × ` 6,62,900)
To Net Profit transferred to Capital A/c 6,31,333
9,43,500 9,43,500

BALANCE SHEET as at 31st March, 2022
Liabilities ` Assets `
Capital 14,00,000 Building 10,00,000
Less: Drawings (Cash) 75,000 Less: Depreciation 25,000 9,75,000
Drawings (Goods) 5,000 80,000 Machinery 75,000
13,20,000 Add: Profit & Loss A/c (WN 2) 28,000
Add: Net Profit 6,31,333 1,03,000
Machinery Purchased Less: Depreciation 11,000 92,000
on 1st April, 2019 wrongly Furniture 40,000
written off, Capitalised Less: Depreciation 4,000 36,000
on 1st April, 2021 [WN 2(i)] 28,000 19,79,333 Debtors 1,50,000
Creditors 1,60,000 Less: Provision for Doubtful Debts 9,000 1,41,000
Outstanding Manager’s Commission 31,567 Investments 6,00,000
Accrued Interest on Investments 18,000
Bank Balance 83,900
Closing Stock 2,25,000
21,70,900 21,70,900
Working Notes:
1. Dr. PROVISION FOR DOUBTFUL DEBTS ACCOUNT Cr.
Particulars ` Particulars `
To Bad Debts A/c (` 14,000 + ` 6,000) 20,000 By Balance b/d 19,000
To Balance c/d (6% on ` 1,50,000) 9,000 By Profit & Loss A/c (Balancing Figure) 10,000
29,000 29,000