HSC Arts 12th Board ExamMaharashtra State Board
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Jitesh and Lailesh Are in Partnership Sharing Profits and Losses in the Ratio of 2:1. from the Following Trial Balance and Adjustments Given Below, You Are Required to Prepare Trading and Profit and Loss A/C for the Year Ended 31st March 2013 and the Balance Sheet as on that Date: - HSC Arts 12th Board Exam - Book Keeping and Accountancy

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Question

Jitesh and Lailesh are in partnership sharing profits and losses in the ratio of 2:1. From the following Trial Balance and adjustments given below, you are required to prepare Trading and Profit and Loss A/c for the year ended 31st March 2013 and the Balance Sheet as on that date:

Trial Balance as on 31st March 2013
Particulars Debit Amount (Rs) Credit Amount (Rs)
Prepaid Insurance 800  
Insurance 2,000  
R.B.D.D.   1,000
Discount 800  
Postage and telephone 3,200  
Salaries 56,000  
Debtors and Creditors 66,000 68,000
Wages 24,000  
Opening Stock 48,000  
Carriage 1,000  
Purchases and Sales 1,93,200 3,01,600
Return inwards and outwards 5,600 9,200
Bank overdraft   1,20,800
Plant & Machinery 24,000  
Land & Building 1,76,000  
Capital    
Jitesh   52,000
Lailesh   48,000
Total 6,00,600 6,00,600
     
Adjustments:
1. Write off Rs. 2,000 for bad debts and provide R.B.D.D. 5% on debtors.
2. Goods worth Rs. 4,000 were distributed as free samples.
3. Closing stock on 31.03.2013 was valued at the cost Rs. 56,000 while its market price was Rs. 60,000.
4. Salaries were outstanding Rs. 2,000.
5. Depreciate:
Land and Building @ 5% p.a. and
Plant & Machinery @ 10% p.a. 

Solution

Financial Statements of Jitesh and Lailesh

Trading Account
for the year ended March 31, 2013

Dr.   Cr.
Particulars Amount (Rs) Particulars Amount (Rs)
Opening Stock 48,000 Sales                                 3,01,600  
Purchases                        1,93,200       Less: Return Inwards          5,600 2,96,000
   Less: Return Outwards       9,200   Closing Stock 56,000
   Less: Free Samples            4,000 1,80,000    
Carriage 1,000    
Wages 24,000    
Gross Profit (Balancing Figure) 99,000    
       
  3,52,000   3,52,000

 

Profit and Loss Account for the year ended March 31, 2013
Dr.   Cr.
Particulars Amount (Rs) Particulars Amount (Rs)
Discount 800 Gross Profit 99000
Free Samples 4,000    
Salary                        56,000      
   Add: Outstanding      2,000 58,000    
Depreciation on Land & Building 8,800    
Depreciation on Plant & Machinery 2,400    
Insurance 2,000    
Old Bad Debts      
   Add: Further Bad Debts      2,000      
   Add: New Provision            3,200      
   Less: Old Provision             1,000 4,200    
Postage & Telephone 3,200    
Net Profit (Balancing Figure)      
    Jitesh              10400      
    Lailesh               5200 15,600    
       
  99,000   99,000

 

Balance Sheet as on March 31, 2013
Liabilities Amount (Rs) Assets Amount (Rs)
Capital    Fixed Assets  
   Jitesh                 52000      Land & Building          176000  
        Add: Profit    10400 62400      Less: Depreciation        8800 167200
   Lailesh                48000      Plant & Machinery       24000  
       Add: Profit        5200 53,200      Less: Depreciation      2400 21600
Current Liabilities   Current Assets  
Creditors 68000 Closing Stock 56000
Outstanding Salary 2000 Debtors                           66000  
Bank Overdraft 120800    Less: Further B. Debts     2000  
       Less: New Provision         3200 60800
    Prepaid Insurance 800
  3,06,400   3,06,400

Working Notes:

WN1 Calculation of Depreciation

Depreciation on Land and  Building=1,76,000×5100=Rs 8,800

Depreciation on Plant and Machinery = 24,000×10100=Rs 2,400

WN2 Calculation of Provision for Doubtful Debts

Provisionfor Doubtful Debts=(66,000−2,000)×5100 = Rs 3,200

WN3 Calculation of Share in Profit

Jitesh's Share in Profit=15,600 × 2/3=Rs 10,400

Lailesh's Share in Profit=15,600 × 1/3=Rs 5,200

  Is there an error in this question or solution?

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Solution Jitesh and Lailesh Are in Partnership Sharing Profits and Losses in the Ratio of 2:1. from the Following Trial Balance and Adjustments Given Below, You Are Required to Prepare Trading and Profit and Loss A/C for the Year Ended 31st March 2013 and the Balance Sheet as on that Date: Concept: Reconstitution of Partnership Examples and Solutions.
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