Final Accounts
1. From the following balances as on 31st December 2022 of a trader, prepare a Trading Profit &
Loss A/c for the year 2022 and a Balance Sheet
Particulars Amount
Salaries 5,500
Rent 1,300
Cash 1,000
Debtors 40,000
Trade Expenses 600
Purchases 25,000
Advances 2,500
Bank Balances 5,600
Creditors 9,500
Sales 32,000
Capital 30,000
Loans 10,000
Adjustments:
The closing stock amounted to Rs.9000
One month salary is outstanding
One month rent has been paid in advance
Provide 5% for doubtful debts
Answer Gross Profit 16000 Net Profit 6,200 Balance Sheet 56,200
2. From the following trial Balance Prepare Trading Profit& Loss A/c for the year ended 31-12-
2023
Particulars Amount Particulars Amount
Purchases 11,870 Capital 8,000
Debtors 7,580 Bad Debts Recovered 250
Return Inwards 450 Creditors 1,250
Bank Deposit 2,750 Return Outwards 350
Rent 360 Bank Overdraft 1,570
Salaries 850 Sales 14690
Travelling Expenses 300 Bills Payable 1,350
Cash 210
Discount Allowed 40
Drawings 600
27,460 27,460
Adjustment
i) The closing stock was Rs.4,200
ii) Write off Rs.80 as bad debts and create a reserve for bad debts at 5% on sundry debtors
iii) Three months rent outstanding
3. The following balances were extracted from the books of A.Subudhi on 31-12-2022
Particulars Amount
Capital 15000
Drawings 2,700
Stock 11,000
Purchases 35,000
Sales 62,000
Return outward 1200
Return Inward 800
Wages 5740
Salaries 8,200
Electric charges 1,120
Discount Paid 770
Discount Received 300
Depreciation 750
Bills Payable 4500
Plant & Machinery 15000
Debtors 8000
Provision for 1,000
debtors
Creditors 19800
Cash in hand 700
Cash at bank 12800
Bills receivable 420
Prepare trading P&L A/c for the year ended 31-12-22 and a Balance sheet as on the date. The value of
the closing stock on 31-12-19 Rs.13, 500
Trading Profit &Loss A/c of Mr. A.Subudhi for the year ended 31-12-22
Particulars Amount Particulars Amount
To opening stock 11,000 By sales 62000 60800
To Purchases 35000 34200 -returs1200
-return 800 By Closing Stock 13500
To Wages 5740
To gross Profit 23360
74300 74300
To Salaries 8,200 By Gross Profit 23360
To electric charges 1120 By Discount received 300
To Discount paid 770 Provision 1000
To Depriciation 750
To Net Profit 13820
24660 24660
Liabilities Amount Assets Amount
Capital 15000 Cash in hand 700
+Net Profit 13820 Cash at Bank 12800
28,820 Debtors 8000
-Drawings 2700 26120 Bills Receivable 420
Creditors 19800 Plant and Machinery 15000
Bills Payable 4500 Closing stock 13500
50420 50420
Problems with solution:
1. The following is the schedule of balances as 0n 31-2-23 extracted from the books of Rajiv
Particulars Debit Balances Particulars Credit
Balances
Cash on Hand 22,800 Capital Account 3,24,000
Cash at Bank 5,200 Discount received from customers 3,200
Sundry Debtors 1,72,000 Purchase Returns 5,200
Stock as on 1-4-23 1,24,000 Sales 4,60,000
Furniture & Fixtures 42,800 Provision for Bad debts 6,000
Office Equipment 32,000 Loan from Gopal 60,000
Buildings 1,20,000
Motor car 40,000
Purchases 2,80,000
Sales Return 8,400
Salaries 22,000
Rent for Godown 11,000
Interest on loan from Gopal 5,400
Rates& Taxes 4,200
Discount allowed to Debtors 4,800
Freight on Purchases 2,400
Carriage Outwards 4,000
Drawings 24,000
Printing and Stationery 3,600
Electric charges 4,400
Insurance Premium 11,000
General office expenses 6,000
Bad debts 4,000
Bank Charges 3,200
Motor Car Expenses 7,200
9,64,400 9,64,400
Prepare Trading P&L A/c for the year ended 31-2-23 and the Balance sheet as at that after making
provision for the following
i) Value of stock on 31-3- 23 was Rs.88,000
ii) One month rent godown is outstanding
iii) One month salary is outstanding
iv) Interest on loan from Gopal is payable at 12% p.a. this loan was taken on 1-5-19
v) Provision for debts is to be maintained at 5% on sundry debtors
vi) Insurance premium includes Rs.8000 paid towards proprietor’s life insurance charges
covers the period from 1-4-21 to 30-6-22
vii) Half of the buildings are used for residential purposes of Raajiv
viii) Depreciate: Buildings used for business by 5%
ix) Furniture and Fixture by 10% one steel table purchased during the year for Rs.2,800
was sold for same price but the sale proceeds were wrongly credited to sales A/c
x) Office Equipment by 15% - Purchases of a typewriter during the year for Rs.8,000
has been wrongly debited to purchases A/c
xi) Motor Car by 20%
Trading Profit& Loss A/c of Raajiv for the year ended 31-3-19
Particulars Amount Particulars Amount
To Opening Stock 1,24,000 By Sales 4,60,000
To Purchases 2,80,000 -Sale of fittings 2,800
-Equipments Purchase 8,000 457200
2,72,000 -Returns 8,400 4,48,800
-Returns 5,200 2,66,800 Closing Stock 88,000
To Freight on Purchases 2,400
To Gross Profit C/d 1,43,600
5,36,800 5,36,800
To Salaries 22,000 24,000 By Gross Profit B/d 1,43,600
+ Outstanding 2,000 By Discount Received 3,200
Rent for Godown 11,000
+Outstanding 1000 12,000
To Interest on loan 5,400 6,600
+Outstanding 1,200
To Rate taxes 4,200
To discount Allowed 4,800
To Carriage Outward 4,000
To Printing& Stationery 3,600
To Electric Charges 4,400
To Ins.on Premium 11,000
-premium on own life policy 8,000
3,000
-prepaid 3,000 Nil
To General ofc Exp 6,000
To Bad Debts 4,000
Add. New Provision 8,600
12,600
Less: Existing Provision 6,000 6,600
To Bank Charges 3,200
To Motor car Expenses 7,200
To Depreciation
Buildings 5% 1,2000=6000 3000
Furniture & Fittings10% 4000
Office Equipments15% 6000
Motor Car20% 8000
To Net Profit 39,200
1,46,800 1,46,800
Balance sheet of Rajeev as on 31-3-23
Liabilities Amount Assets Amount
Capital 3,24,000 Buildings 1,20,000
Add: Net Profit 39,200 Less: Depreciation 3,000 1,17,000
3,63,200 Furniture& Fittings 42,800 36,000
Less: Drawings Less: Sale 2800
(24,000+ 8,000) 32,000 3,31,200 40,000
Loan From Gopal 60,000 Less: Dep 4,000
Add: Outstanding Interest 1,200 61,200 Office Equipment 32,000
Sundry Creditors 106000 Add Purchase 8,000
Outstanding Expenses 3000 40,000
Salaries 2000 Less: Dep 6,000 34,000
Rent for Godown 1000 Motor Car 40,000 32,000
Less: Dep 8,000
Stock 88,000
Sundry Debtors 1,72,000 1,63,400
Less Provision for BD 8600
Cash at Bank 5,200
Cash on Hand 22,800
Prepaid Insurance 3,000
5,01,400 5,01,400
