Question

Convert following Trading Account and Profit and Loss Account into Vertical Income Statement:

Dr.	Trading, Profit and Loss Account for the year ended as on 31st March,2020		Cr.
Particulars	Amount ₹	Particulars	Amount ₹
To Opening stock	20,000	By Sales	1,20,000
To Purchases	90,000	By Closing Stock	30,000
To Carriage inward	500
To Wages	10,000
To Gross Profit c/d	29,500
Total	1,50,000	Total	1,50,000
To Office expenses	12,500	By Gross Profit b/d	29,500
To Selling expenses	10,000
To Finance expenses	3,000
To Net Profit c/d	4,000
	29,500		29,500

Answer 1

Vertical Income statement as on 31st March, 2020
Sr.No.	Particulars	Amount ₹	Amount ₹
1.	Sales		1,20,000
2.	Less: Cost of good sold
	Opening Stock	20,000
	Add: Purchases	90,000
	Add: Wages	10,000
	Add: Carriage Inward	500
		1,20,500
	Less: Closing Stock	30,000	90,500
3.	Gross Profit		29,500
4.	Less: Operating Expenses
	Admin Expenses	12,500
	Selling	10,000
	Finance Expenses	3,000
5.	Total Operating Expenses		25,500
6.	Net Profit		4,000