Mrs. Ankita keeps her books under Single Entry System and gives the following information.
|Stock in Trade||15,000||19,000|
Mrs. Ankita withdrew Rs 4,000 for her personal use. She received Rs 15,000 from her father as gift, which she brought into the business.
Additional furniture was purchased on 1st October 2011. Depreciate furniture by 10% p.a.Write off Rs 1,000 as bad and provide 5% R.D.D. on debtors.
Find the profit or loss of her business for the year ended 31st March, 2012.
|Bills Payable||5,000||Bank Balance||18,000|
|Capital (Balancing Figure)||45,500||Debtors||35,000|
|Bills Payable||8,000||Bank Balance||28,000|
|Capital (Balancing Figure)||78,500||Stock||19,000|
|Capital at the end of the year||78,500|
|Add: Drawings made during the year||4,000|
|Less: Additional capital introduced during the year||(15,000)|
|Adjusted capital at the end of the year||67,500|
|Less: Capital in the beginning of the year||(45,500)|
|Less: Depreciation on Furniture||(1,400)|
|Reserve for Doubtful Debts||(2,450)|
|Profit for the year||17,150|
WN1: Calculation of Depreciation on Furniture:
Depreciation on Furniture for 6 months ( Apr. 01,2011 - Oct.01,2011) = 9,000 x `10/100` x `6/12` = Rs. 450
Depreciation on Furniture for 6 months ( Oct.01,2011 - Mar.31,2012) = 19,000 x `10/100` x `6/12` = Rs.950
Total Depreciation on charged on Furniture = 450 + 950 = Rs. 1,400.
WN2: Calculation of Reserve for Doubtful Debts:
Reserve for Doubtful Debts = 49,000 x `5/100` = Rs. 2,450.
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