Question

From the trial balance of Sumathi and the adjustments prepare the trading and profit and loss account for the year ended 31^st March, 2016, and a balance sheet as on that date.

Particulars	Debit ₹	Credit ₹
Stock on April 1, 2015	900
Purchases	2,000
Sales		4,000
10% Loan		2,000
Carriage on purchases	200
Rent from tenant		250
Interest on loan	100
Machinery	400
Postage	100
Salary	650
Commission received		200
Cash in hand	75
Furniture	4,000
Capital		1,975
	8,425	8,425

Adjustments

(a) Six months interest on the loan is outstanding.

(b) Two months rent is due from the tenant, the monthly rent being ₹ 25.

(c) Salary for the month of March 2016, ₹ 75 is unpaid.

(d) Stock in hand on March 31, 2016, was valued at ₹ 1,030.

Answer 1

Trading and Profit & Loss A/c of Sumathi
for the year ended 31^st March 2016

 

Dr.						Cr.
Particulars		₹	₹	Particulars	₹	₹
To Opening stock			900	By Sales		4,000
To Purchases			2,000	By Closing Stock		1,030
To Carriage on purchases			200
To Gross profit c/d			1,930
			5,030			5,030
To Interest on loan		100	200	By Gross profit b/d		1,930
Add: Outstanding		100		By Rent from tenant	250	300
To Postage			100	Add: Accrued rent (25 × 5)	50
To Salary		425	500	By Commission received		200
Add: Unpaid salary		75
To selling expenses			225
To Net profit c/d			1,405
			2,430			2,430

Balance Sheet of Sumathi
as on 31.03.2016

Liabilities	₹	₹	Assets	₹
Capital	1,975		Cash in hand	75
Add: Net profit	1,405	3,380	Furniture	4,000
Loan @ 10%	2,000	2,100	Machinery	400
Add: Outstanding interest	100		Accrued rent	50
Salary unpaid		75	Closing stock	1,030
		5,555		5,555