Question No 04 B Chapter No 20 – D.K Goal 11 Class

Question No 04 B Chapter No 20

04 B. the following are the balance of Messrs Gupta & Co. as at 31st March 2018:-

Particular	Rs	Particular	Rs
Cash in hand	540	Patents	7,500
Cash at Bank	2,630	Salaries	25,000
Purchases	40,675	General Expenses	22,790
Return Inwards	680	Insurance	600
Wages	8,480	Drawing	5,245
Fuel & Power	4,730	Sundry Debtors	14,500
Bad debts	210	Sales	98,440
Bad debts provision	340	Return outwards	500
Carriage on sale	3,200	Capital	92,000
Carriage on purchases	2,040	S. Creditor	6,300
Stock (1-4-2017)	5,760	Rent Cr.	9,000
Building	32,000
Freehold Land	10,000
Machinery	20,000

Prepare trading and Profit & loss A/c and a balance Sheet as at 31st March 2018 after taking into account the following adjustments:-
i Stock on hand as on 31st March 2018 is Rs 6,800
ii Machinery is to be depreciated at 10% and Patents at 20%
iii Salaries for the month of March 2018 amounting to Rs 1,500 were unpaid
iv Insurance includes a premium of Rs 170 on a policy expiring on 30th September 2018
v Write of Rs 500 as bad debts and Create a provision for doubtful Debts at 5% on Sundry Debtors
vi Rent receivable Rs 1,000

The solution of Question No 04 B Chapter No 20: –

Trading Account
Particular		Amount	Particular		Amount
To Opening Stock A/c		5,760	By Sales	98,440
To Purchases A/c	40,675		Less: return	680	97,760
Less: Return	500	40,175
To Carriage on purchases A/c		2,040	By Closing Stock		6,800
To Fuel & Power A/c		4,730
To Wages A/c		8,480
To Gross Profit		43,375
		1,04,560			1,04,560

Profit & Loss Account
Particular		Amount	Particular		Amount
Depreciation on Furniture (WN)			By Gross Profit		43,375
Machinery	2,000		By Rent	9,000
Patents	1,500	3,500	Add: Rent accrued	1,000	10,000
To Salaries	25,000
Add: Outstanding	1,500	26,500
Old Bad Debts	210
Add: New Bad Debts	500
Add: New Provision (WN2)	700
Less: Old Provision	340	1,070
To Insurance	600
Add: Outstanding Taxes	85	515
To Carriage on Sale		3,200
To General Expenses		22,790
			By Net Loss A/c		4,200
		57,575			57,575

Balance Sheet
Liabilities		Amount	Assets		Amount
Capital	92,000		Patents	7,500
Less: Net Loss	4,200		Less: Depreciation	1,500	6,000
Less: Drawings	5,245	82,555	Machinery	20,000
Creditors		6,300	Less: Depreciation	2,000	18,000
Outstanding Salaries		1,500	Building		32,000
			Freehold Land		10,000
			Debtors	14,500
			Less: Further Bad Debts	500
			Less: Provision for Bad Debts	700	13,300
			Closing Stock		6,800
			Prepaid Insurance		85
			Cash in Hand		540
			Cash At Bank		2,630
			Cash At Bank		1,000
		90,355			90,355

Working Note: –

Calculation of Depreciation

Depreciation on Machinery	=	10	X	20,000
		100
	=	Rs 2,000

Depreciation on Patents	=	20	X	7,500
		100
	=	Rs 1,500

Calculation of Provision for Doubtful Debts

Provision for Doubtful Debts = Sundry Debtors −Further Bad Debts × Rate 100

Provision for Doubtful Debts	=	5	X	14,500 – 500
		100
	=	Rs 700

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Also, Check out the solved question of all Chapters: –

D K Goel – New ISC Accountancy -(Class 11 – ICSE)- Solution

• Chapter 1 Evolution of Accounting & Basic Accounting Terms
• Chapter 2 Accounting Equations
• Chapter 3 Meaning and Objectives of Accounting
• Chapter 4 Double Entry System
• Chapter 5 Books of Original Entry – Journal 
• Chapter 6 Accounting for Goods and Service Tax (GST) (Coming soon)
• Chapter 7 Books of Original Entry – Cash Book (Coming soon)
• Chapter 8 Books of Original Entry – Special Purpose Subsidiary Books (Coming soon)
• Chapter 9 Ledger (Coming soon)
• Chapter 10 Trial Balance and Errors (Coming soon)
• Chapter 11 Bank Reconciliation Statement (Coming soon)
• Chapter 12 Depreciation (Coming soon)
• Chapter 13 Bills of Exchange (Coming soon)
• Chapter 14 Generally Accepted Accounting Principles(GAAP) 
• Chapter 15 Bases of Accounting
• Chapter 16 Accounting Standards and International Financial Reporting Standard(IFRS) (Coming soon)
• Chapter 17 Capital and Revenue 
• Chapter 18 Provisions and Reserves 
• Chapter 19 Final Accounts (Coming soon)
• Chapter 20 Final Accounts – With Adjustments (Coming soon)
• Chapter 21 Errors and their Rectification (Coming soon)
• Chapter 22 Accounts from Incomplete Records – Single Entry System (Coming soon)
• Chapter 23 Accounts of Not-for-Profit Organisations (Coming soon)
• Chapter 24 Computerised Accounting System (Coming soon)
• Chapter 25 Introduction to Accounting Information System (Coming soon)

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