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Solution for Abhijeet and Sujeet Are Partners Sharing Profits and Losses in the Ratio of 3 5 and 2 5 Respectively. from the Following Trial Balance and Adjustments, Prepare Trading, Profit and Loss Account - HSC Commerce (Marketing and Salesmanship) 12th Board Exam - Book Keeping and Accountancy

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Question

Abhijeet and Sujeet are partners sharing profits and losses in the ratio of `3/5` and `2/5`respectively. From the following trial balance and adjustments, prepare Trading, Profit and Loss Account for the year ended 31st March, 2010 and the Balance Sheet as on that date. 

Trial balance as on 31st march 2010

Debit Balance

Amount (Rs)

Credit Balance

Amount (Rs)

Drawing accounts :

    Abhijeet

    Sujeet

Land and building

Plant (Addition on 1.1.2010, Rs 20,000)

Opening stock

Wages

Cash at bank

Sundry debtors

Purchases

Carriage

Rent, rates and insurance

Furniture

Salaries

Bad debts

Office expenses

 

6,000

4,000

1,70,000

90,000

 

44,000

13,500

6,500

69,200

1,22,500

2,100

4,500

50,000

7,600

3,200

5,400

Capital accounts :

    Abhijeet

    Sujeet

Sales

Sundry creditors

Bank overdraft

Reserve for doubtful debts

Outstanding expenses

Sundry income

Pre-received rent

10% Bank loan

(Taken on 1st Oct., 2009)

 

1,32,000

88,000

1,69,000

81,900

80,000

2,000

4,600

4,000

5,000

32,000

 

5,98,500

5,98,500

Adjustments −
(1) Closing stock was valued at cost Rs 34,000 and at market price Rs 40,000.

(2) Depreciate plant @ 10% p. a.

(3) Insurance was prepaid Rs 600.

(4) Office expenses include personal expenses of Sujeet Rs 800.

(5) Maintain R.D.D. at 5% on sundry debtors.

Solution

 Financial Statement of Abhijit and Sujit 

Trading Account 

for the year ended , March 31, 2010

Particulars 

Amount

(Rs)

Particulars

Amount

(Rs)

Opening Stock

44,000

Sales

1,69,000

Purchases

1,22,500

Closing Stock

34,000

Wages

13,500

 

 

Carriage

2,100

 

 

Gross Profit (Balancing Figure)

20,900

 

 

 

2,03,000

 

2,03,000

Profit and Loss Account 

for the year ended March 31,2010

Particulars 

Amount

(Rs)

Particulars

Amount

(Rs)

Depreciation on Plant

7,500

Gross Profit

20,900

Rent, Rate & Insurance

4,500

 

Sundry Incomes

4,000

Less: Prepaid

600

3,900

Net Loss (Balancing Figure)

 

Office Expenses

5,400

 

Abhijeet’s Capital A/c

2,976

 

Less: Personal Expenses (Sujeet)

800

4,600

Sujeet’s Capital A/c

1,984

4,960

Old Bad debts

3,200

 

 

 

Add: New Reserve

3,460

 

 

 

Less: Old Reserve

2,000

4,660

 

 

Outstanding Interest on Bank Loan

1,600

 

 

Salaries

7,600

 

 

 

 

 

 

 

29,860

 

29,860

Balance sheet 

as on March 31,2010

Liabilities 

Amount

(Rs)

Assets 

Amount

(Rs)

Capital

 

Fixed Assets

 

Abhijeet

1,32,000

 

Plant & Machinery

70,000

 

Less: Share of Net Loss

2,976

 

Add: Addition

20,000

 

Less: Drawings

6,000

1,23,024

Less: Depreciation

7,500

82,500

Sujeet

88,000

 

Land and Building

1,70,000

Less: Share of Loan

1,984

 

Furniture

50,000

Less: Drawings (4,000 + 800)

4,800

81,216

 

 

 

 

 

Current Assets

 

10% Bank Loan

32,000

 

Closing Stock

34,000

Add: Outstanding Amount

1,600

33,600

Prepaid Insurance

600

Current Liabilities

 

Cash at Bank

6,500

Creditors

81,900

Sundry Debtors

69,200

 

Bank overdraft

80,000

Less: Reserve for Doubtful Debts

3,460

65,740

Outstanding Expenses

4,600

 

 

Pre Received Rent

5,000

 

 

 

 

 

 

 

4,09,340

 

 

 

 
WN1 Calculation of Depreciation on Plant

\[\begin{array}{l}\text{Depreciation on Plant (Costing Rs} 70, 000) = 7, 00, 000 \times\frac{10}{100}= Rs 7, 000 \\ \text{Depreciation on Plant purchased as on Jan.} 01, 2010 = 20,000 \times\frac{10}{100}\times\frac{3}{12}= Rs\ 500 \\ \text{Total Depreciation charged on Plant} = 7,000 + 500 = Rs\ 7,500\end{array}\]

WN2 Calculation of Reserve for Doubtful Debts 

\[\text{Reserve for Doubtful Debt} = 69,200 \times\frac{5}{100}= Rs\ 3,460\]

WN3 Calculation of Interest on Bank Loan 

\[\text{Outstanding Interest on Bank Loan} = 32,000 \times\frac{10}{100} \times \frac{6}{12}= Rs\ 1, 600\]

WN4 Distribution of Net Loss

\[\begin{array}{l}\text{Abhijeet} = 4,960 \times\frac{3}{5}= Rs\ 2, 976 \\ \text{Sujeet} = 4,960 \times\frac{2}{5}= Rs\ 1, 984\end{array}\]

Outstanding Interest on Bank Loan = 32,000 × 10100 × 612 = Rs 1,600" data-mathml_index="20">
  Is there an error in this question or solution?

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 2012-2013 (March) (with solutions)
Question 7 | 20.00 marks

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Solution Abhijeet and Sujeet Are Partners Sharing Profits and Losses in the Ratio of 3 5 and 2 5 Respectively. from the Following Trial Balance and Adjustments, Prepare Trading, Profit and Loss Account Concept: Admission of a Partner.
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