Jaya and Maya are partners in a firm sharing profits and losses in the ratio of 2 : 3 respectively. With the help of the trial balance and adjustments given below, you are required to prepare their Trading, Profit and Loss Account for the year ended 31st March, 2013 and the Balance Sheet as on that date :
Trial Balance as on 31st March, 2013
| Debit Balances | Amount | Credit Balances | Amount |
| Purchases | 1,09,000 | Sundry creditors | 45,600 |
| Insurance | 3,700 | Sales | 1,94,000 |
| Rent, rates and taxes | 14,600 | R.D.D. | 2,000 |
| Office expenses | 7,300 | Commission | 5,500 |
| Land and buildings | 3,00,000 | Capital A/c’s: | |
| Plant and machinery | 60,000 | Jaya | 2,00,000 |
| Furniture | 15,000 | Maya | 2,50,000 |
| Carriage inwards | 3,700 | Current A/c’s: | |
| Sundry debtors | 88,000 | Jaya | 3,400 |
| Stock (as on 01.04.2012) | 32,800 | Maya | 9,100 |
| Wages and salaries | 28,600 | ||
| Cash in hand | 4,700 | ||
| Cash at bank | 40,200 | ||
| Drawings A/c’s: | |||
| Jaya | 500 | ||
| Maya | 1,500 | ||
| 7,09,600 | 7,09,600 |
Adjustments :
(1) Closing stock was valued at Rs. 22,600.
(2) Purchases include purchase of furniture of Rs .10,000 made on 1st October, 2012.
(3) Depreciate land and buildings at 10% p.a.; plant and machinery at 10% p.a. and furniture at 20% p.a.
(4) Create R.D.D. at 5% on sundry debtors.
Solution
Trading and Profit and Loss and Appropriation A/c
For the year ending 31.03.2013
|
Particulars
|
Amount
|
Amount
|
Particulars
|
Amount
|
Amount
|
|
To Opening Stock
|
32,800
|
By Sales
|
194,000
|
||
|
To Purchases
|
109,000
|
By Closing Stock
|
22,600
|
||
|
Less: Purchase of furniture wrongly included
|
10,000
|
99,000
|
|||
|
To Carriage Inwards
|
3,700
|
||||
|
To Wages and Salaries
|
28,600
|
||||
|
To Gross Profit C/d
|
52,500
|
||||
|
216600
|
216600
|
Profit & Loss Account for the year ended 31 st March, 2011
|
Particulars
|
Amount
|
Amount
|
Particulars
|
Amount
|
Amount
|
|
To Insurance
|
3,700
|
By Gross Profit b/d
|
52,500
|
||
|
To Rent, Rates and Taxes
|
14,600
|
By Commission
|
5,500
|
||
|
To Office Expenses
|
7,300
|
||||
|
To R.B.D.D. A/c
|
|||||
|
New Reserve
|
4,400
|
||||
|
Less: Old Reserve
|
2,000
|
2,400
|
|||
|
To Depreciation on Land and Building
|
30,000
|
||||
|
Plant and Machinery
|
6,000
|
By Partners’ Current A/c
[Net Loss]
|
|||
|
Furniture
|
4,000
|
40,000
|
Jaya (2/5)
|
4000
|
|
|
Maya (3/5)
|
6000
|
10000
|
|||
|
68,000
|
68,000
|
Partner's Current Accounts
| Particulars | Jaya | Maya | Particulars | Jaya | Maya |
| To Drawings A/c | 500 | 1500 | By Balance b/d | 3400 | 9100 |
| To Profit & Loss A/c | 4000 | 6000 | By Balance b/d | 1100 | - |
| To Balance c/d | - | 1600 | |||
| 4500 | 9100 | 4500 | 9100 |
Balance Sheet as on 31st March, 2013
|
Liabilities
|
Amount
|
Amount
|
Assets
|
Amount
|
Amount
|
|
Partners’ Capital A/c
|
Land and Building
|
300,000
|
|||
|
Capital A/c
|
Less: Depreciation
|
30,000
|
270,000
|
||
|
Jaya
|
200,000
|
Plant and Machinery
|
60,000
|
||
|
Maya
|
250,000
|
450,000
|
Less: Depreciation
|
6,000
|
54,000
|
|
Sundry Creditors
|
45600
|
Furniture
|
15,000
|
||
|
Maya’s Current A/c
|
1600
|
Add: New furniture Purchased
|
10,000
|
||
|
Less: Depreciation
|
(- 4000)
|
21,000
|
|||
|
Sundry Debtors
|
88,000
|
||||
|
Less: R.D.D. @ 5%
|
(- 4400)
|
83,600
|
|||
|
Closing Stock
|
22,600
|
||||
|
Cash in Hand
|
4,700
|
||||
|
Cash at Bank
|
40,200
|
||||
|
Jaya’s Current A/c
|
1100 | ||||
|
497,200
|
497,200
|
1. Depreciation of Land and Building :
= 300,000 x `10/100` = 30,000
= 60,000 x `10/100` = 6,000
