Question No 05 Chapter No 20 – D.K Goal 11 Class

Question No 05 Chapter No 20

05. From the following figures prepare the Trading and Profit and Loss Account for the year ended 31st March, 2019 and the Balance Sheet as at that date:-

Particular	Rs	Particular	Rs
Stock 1stApril, 2018	75,000	Sundry Debtors	82,000
Purchases	8,00,000	Loan from X	10,000
Sales	12,00,000	Interest on X Loan	1,500
Motor Car	1,50,000	Furniture	20,000
Car Expenses	42,000	Land and Building	2,00,000
Rent	5,500	Capital	2,50,000
Salaries	35,200	Sundry Creditors	91,300
Bad Debts	1,500	Returns Inward	7,500
Provision for bad debts	8,100	Returns Outward	6,000
Commission Cr	4,600	Cash in hand	16,400
Wages	1,25,000
Insurance	8,400

Adjustments:-
i Commission include 1,600 being commission received in advance.
ii Write off 2,000 as further Bad-debts and maintain Bad-debts provision at 5% on debtors.
iii Expenses paid in advance are: Wages 5,000 and Insurance 1,200.
iv Rent and Salaries have been paid for 11 months.
v Loan from X has been taken at 18% p.a. interest.
vi Depreciate furniture by 15% p.a. and Motor Car by 20% p.a.
vii Closing Stock was valued at 60,000

The solution of Question No 05 Chapter No 20: –

Trading Account
Particular		Amount	Particular		Amount
To Opening Stock A/c		75,000	By Sales	12,00,000
To Purchases A/c	8,00,000		Less: return	7,500	11,92,500
Less: Return	6,000	7,94,000
To Wages A/c	1,25,000		By Closing Stock		60,000
Less: Prepaid	5,000	4,730
To Gross Profit		2,63,500
		12,52,500			12,52,500

Profit & Loss Account
Particular		Amount	Particular		Amount
Depreciation on Furniture (WN)			By Gross Profit		2,63,500
Furniture	3,000		By Commission	4,600
Motor Car	30,000	33,000	Less: Comm. received in advance	1,600	3,000
To Salaries	35,200		By Old Provision for Doubtful Debts	8,100
Add: Outstanding	3,200	38,400	Less: New Provision (WN3)	4,000	4,100
To Rent	5,500
Add: Outstanding	500	6,000
To Insurance	8,400
Less: Prepaid	1,200	7,200
To Insurance	1,500
Add: Outstanding Taxes	300	1,800
To Old Bad Debt	1,500
Add: Further Bad Debts	2,000	3,500
To Car Expenses		42,000
To Net Profit A/c		1,38,700
		2,70,600			2,70,600

Balance Sheet
Liabilities		Amount	Assets		Amount
Capital	2,50,000		Furniture	20,000
Add : Net Profit	1,38,700	3,88,700	Less: Depreciation	3,000	17,000
Loan from X	10,000		Motor Car	1,50,000
Add: Outstanding Interest on Loan	300	10,300	Less: Depreciation	30,000	1,20,000
Creditors		91,300	Closing Stock		60,000
Outstanding Salaries		3,200	Land & Building		2,00,000
Outstanding Rent		500	Debtors	82,000
Commission received in advance		1,600	Less: Further Bad Debts	2,000
			Less: Provision for Bad Debts	4,000	76,000
			Prepaid Wages		5,000
			Prepaid Insurance		1,200
			Cash in Hand		16,400
		4,95,600			4,95,600

Working Note: –

Calculation of Depreciation

Depreciation on Furniture	=	15	X	20,000
		100
	=	Rs 3,000

Depreciation on Motor Car	=	20	X	1,50,000
		100
	=	Rs 30,000

Calculation of Outstanding Expenses

1. Salaries for 11 months = 35, 200

Salary for 1 month	=	35,200	X	1
		11
	=	3, 200 (Salary Outstanding)

2. Rent for 11 months = 5, 500

Rent for 1 month	=	5,500	X	1
		11
	=	500 (Rent Outstanding)

3. Interest on Loan	=	18	X	10,000
		100
	=	Rs 1,800

Interest paid = 1, 500
∴ Interest Outstanding = 300(1, 800 −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	(82,000 – 2,000)
		100
	=	Rs 4,000

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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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