Maharashtra State BoardHSC Commerce 12th Board Exam
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Mr. Prabhakar is a Retail Trader. He Had No Proper Methods of Accounting. but the Following Information is Made Available to You. - Book Keeping and Accountancy

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 Mr. Prabhakar is a retail trader. He had no proper methods of accounting. But the following information is made available to you.  

Particulars

Amount
Rs.
1.4.2009

Amount
Rs.
31.3.2010

Sundry Debtors

Sundry Creditors

Bank overdraft

Stock

Cash in hand

Bills receivable

Furniture

Motor Van

Computer

10% Govt. Bonds

45,000

60,000

80,000

65,000

2,000

60,000

10,000

80,000

60,000

50,000

70,000

40,000

80,000

8,000

80,000

10,000

80,000

1,20,000

10,000

Adjustments:

(1) On 1st October, 2009 Mr. Prabhakar had withdrawn Rs. 40,000 for his personal use.

(2) 10% Government Bonds were purchased of Rs. 10,000 on 1st October, 2009.

(3) He had also withdrawn Rs. 30,000 for his daughter's marriage.

(4) Depreciate furniture by 10% and write off Rs. 2,000 from motor van.

(5) Rs 2,000 is written off as bad debts and provide 5% R.D.D. on debtors.

(6) Allow interest on capital at 10% p.a.

(7) Charge interest on drawings Rs. 2,000.

Prepare after taking into consideration the adjustments:

Opening statement of affairs of 1.4.2009.

Closing statement of affairs of 31.3.2010.

Statement showing Profit or Loss for the year ended on 31.3.2010.

 

 

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Solution

In the books of Mr. Prabhakar

Statement of Affairs

as on March 31, 2009

Liabilities

Amount

(Rs)

Assets

Amount

(Rs)

Creditors

60,000

Cash in Hand

2,000

Bank Overdraft

80,000

Debtors

45,000

Capital (Balancing Figure)

1,82,000

Stock

65,000

 

 

Furniture

10,000

 

 

Bills Receivable

60,000

 

 

Motor van

80,000

 

 

Computer

60,000

 

3,22,000

 

3,22,000

 

Statement of Affairs

as on March 31, 2010

Liabilities

Amount

(Rs)

Assets

Amount

(Rs)

Creditors

70,000

Cash in Hand

8,000

Bank Overdraft

40,000

Debtors

50,000

 

Capital (Balancing Figure)

3,21,100

Less: Bad Debts

2,000

 

 

 

Less: Provision for Doubtful Debts

2,400

45,600

 

 

Stock

80,000

 

 

Bills Receivable

80,000

 

 

Furniture

10,000

 

 

 

Less: Depreciation @ 10%

1,000

9,000

 

 

Motor Van

80,000

 

 

 

Less: Depreciation

2,000

78,000

 

 

Computer

1,20,000

 

 

10% Government Bonds

10,000

 

 

Outstanding Interest on Bond

500

 

 

 

 

 

4,31,100

 

4,31,100

 

Statement of Profit or Loss

for the year ended March 31, 2010

Particulars

Amount

(Rs)

Capital at the end of the year 31.03.10

3,21,100

 

Add: Drawings made during the year (40,000 + 30,000)

70,000

 

Add: Interest on Drawings

2,000

 

Less: Additional capital introduced during the year

Adjusted capital at the end of the year 31.03.10

3,93,100

 

Less: Capital in the beginning of the year 31.03.09

1,82,000

 

Less: Interest on Capital

18,200

Profit or Loss for the year

1,92,900

Working Notes:

WN1 Calculation of Provision for Doubtful Debts

\[\text{Provision for Doubtful Debts} = 48, 000 \times \frac{5}{100} = Rs 2, 400\]
WN2 Calculation of Depreciation
\[\text{On Furniture} = 10, 000 \times \frac{10}{100} = Rs 1, 000\]
WN3 Calculation of Accrued Interest on Bonds
\[\text{Accrued Interest on Bonds} = 10,000 \times\frac{10}{100}\times\frac{6}{12}= Rs 500\]
WN4Calculation of Interest on Capital
\[\text{Interest on Capital} = 1, 82, 000 \times\frac{10}{100} = Rs 18, 200\]
Concept: Issue of Shares for Consideration Other than Cash
  Is there an error in this question or solution?
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