Unit 1
FINAL ACCOUNTS OF COMPANIES
I: Objective Type Questions:
A: State whether the following statements are 'True' or 'False':
(i) Section 129 deals with form and contents of the Balance Sheet and Profit & Loss Account.
Answer: True
(ii) Schedule III dose not contain the heading "Miscellaneous Expenditure" in Balance Sheet.
Answer: True;
(iii) Interim dividend is a dividend which is declared between two annual general meetings.
Answer: True
(iv) A company must pay Corporate Dividend Tax or Dividend Distribution Tax as and when any dividend is declared by the company.
Answer: True
(v) Preliminary expenses are those expenses which are incurred on the winding up of a company.
Answer: False
(vi) Outstanding debenture interest is shown under the head "Non-Current Liabilities".
Answer: False
(vii) Investments made by a Joint stock Company is shown is on the assets side under the head Fixed Assets.
Answer: False
(viii) Appropriation of profit such as dividend is shown in the statement of profit and loss.
Answer: False
(ix) Live Stock is treated as intangible assets.
Answer: False
(x) Debenture issued by a company is shown under the head "Short Term Borrowings".
Answer: False
B: Fill in the Blanks:
(i) Expenses incurred at the time of formation of a company is termed as _________ expenses.
Answer: Preliminary expenses
(ii) _________ is the fee which a company is required to pay to get their shares listed in a stock exchange.
Answer: Share listing fee
(iii) _________ is a system of gradation of a company about its relative capacity in respect of timely repayment of interest and principal of a particular type of debt.
Answer: Credit rating
(iv) Interest on debenture is a _________ again profits.
Answer: Charge
(v) on Issue of shares in shown on the liabilities side of the balance sheet under the head ____________.
Answer: Reserves & Surplus
(vi) ____________ is a temporary account, required to be opened in order to be opened in order to complete the double entry in respect of share capital or debentures.
Answer: Share Suspense Account
(vii) A company is required to open a separate bank account for the payment of ____________.
Answer: dividend
(viii) Preparation of financial statement of a company as per revised schedule VI is mandatory from the financial year ____________.
Answer: 2011-12
(ix) Appropriation of profits is shown in ____________ the to Accounts.
Answer: Notes
(x) Deficit in Statement of Profit and Loss is shown in the Balance under as deduction from ____________.
Answer: Reserves
(xi) Remuneration paid to an auditor is shown in the statement of profit and Loss as Other Expenses under the main head ____________.
Answer: Expenses
II. Short Answer Type Questions:
(i) What is meant by Current Assets? When an asset shall be classified as current under the revised format of Balance Sheet?
Answer:
(ii) What is meant by Non-Current Assets? When an asset shall be classified as non-current under the revised format of Balance Sheet?
Answer:
(iii) What is meant by Current Liabilities? When a liability shall be classified as current under the revised format of Balance Sheet?
Answer:
(iv) Give meaning of Deferred Tax Liabilities.
Answer:
(v) Explain the term 'Deferred Tax Asset'.
Answer:
(vi) State the accounting treatment of 'Preliminary expenses'.
Answer:
(vii) Write the accounting treatment of 'CENVAT Credit' in the final accounts of a company.
Answer:
(viii) Write the accounting treatment of 'Loss on issue of Debentures' in the final accounts of a company.
Answer:
(ix) Mention the source of creation of Investors Education and Protection Fund.
Answer:
(x) Explain how the Loss incurred by a company in a particular year will be disclosed in the balance sheet.
Answer:
(xi) Write a note on 'Corporate Dividend Tax'.
Answer:
(xii) Write a note on 'Interim Dividend'.
Answer:
(xiii) Described the treatment of proposed dividend in Company final Account.
Answer:
III. Long Answer Type Questions:
1. State the statutory provisions relating to preparation and presentation of final accounts.
Answer:
2. How would you deal with the following items while preparing the final accounts of a company?
Answer:
(a) Fees for Credit Rating
Answer:
(b) Filing fee with the Registrar of Companies
Answer:
(c) Share Suspense Account
Answer:
(d) Transfer Fee
Answer:
(e) Corporate Dividend Tax
Answer:
(f) Unpaid Dividend
Answer:
(g) Director's fees
Answer:
(h) Managerial Remuneration
Answer:
(i) Preliminaryexpenses
Answer:
(j) Proposed dividend.
Answer:
3. Explain Deferred Tax liabilities and state how it is calculated with the help of an example.
Answer:
IV. Practical Problems:
1. The Following are the extracts from the trial balance of a company on 31st March, 2019:
| Dr. Amount Rs. | Cr. Amount Rs. |
Provision for tax (2017-2018) | - | 40,000 |
Advance tax paid for (2017-2018) | 36,000 | - |
Advance tax paid for (2018-2019) | 20,000 | - |
Tax deducted at source (2018-2019) | 2,000 | - |
Surplus in the Statement of Profit & loss (2017-2019) | - | 40,000 |
Rs. | |
Interest on loans given | 14,80,000 |
Fees received for processing loans | 2,60,000 |
Profit on sale of Building | 1,40,000 |
Profit on sale of Investments | 65,000 |
Dividends Received | 75,000 |
Sale of Miscellaneous items | 8,100 |
Interest received on deposit | |
With other Financial institution | 80,000 |
SMS charges recovered from clients | 16,500 |
Rs. | |
Inventory of Materials on 1st April, 2018 | 1,40,000 |
Purchases of Materials | 6,95,000 |
Return of Materials Purchased | 7,000 |
Stores and spare parts used | 4,000 |
Lubricants purchased and Used | 1,800 |
Inventory of Materials on 31st March, 2019 | 1,50,000 |
| 31-3-2019 (Rs.) | |
Finished Goods | 2,95,000 | 2,40,000 |
Work-in-Progress (Sami-Finished-Goods) | 1,30,000 | 1,60,000 |
Stock-in Trade | 2,15,000 | 1,70,000 |
Materials | 75,000 | 50,000 |
Purchase of Materials during 2018-19 Rs. 4,50,000 | ||
Purchase Returns during 2018-19 13,000 |
Rs. | ||||||||||||||||||||
Sales | 3,60,000 | |||||||||||||||||||
Purchases | 1,75,000 | |||||||||||||||||||
Opening stock of finished goods | 40,000 | |||||||||||||||||||
Closing stock of finished goods | 20,000 | |||||||||||||||||||
Interest received | 12,000 | |||||||||||||||||||
Dividend received | 4,000 | |||||||||||||||||||
Wages | 14,000 | |||||||||||||||||||
Salaries | 22,000 | |||||||||||||||||||
Depreciation on Machinery | 10,000 | |||||||||||||||||||
General expenses | 15,000 | |||||||||||||||||||
Interest on debentures | 6,000 | |||||||||||||||||||
Provision for taxation | 20,000 | |||||||||||||||||||
Transfer to General Reserve | 14,000 | |||||||||||||||||||
Surplus in the Statement of Profit and Loss (on 1-4-2018) Answer: 9. The following is the extract of Trial Balance of Gauripur Ltd. as on 31at March, 2019.
|
(Rs.) | |
Sales | 5,80,000 |
Purchases | 1,90,000 |
Custom Duty | 4,000 |
Wages | 34,000 |
Salaries | 92,000 |
General Expenses | 7,000 |
Opening Inventory | 62,000 |
Dividend received | 4,000 |
Income Tax Refund | 3,500 |
Machinery | 6,00,000 |
Opening inventory | 60,00 |
Purchase Return | 15,000 |
Purchases | 2,55,000 |
Sales | 3,90,000 |
Salaries and Wages | 60,000 |
Dividend received | 4,200 |
Freight Inward | 1,200 |
Carriage outward | 2,300 |
Bad debts | 1,100 |
Cost of Printing of Annual Report | 4,500 |
Auditor’s fee | 3,200 |
Commission to Directors | 6,000 |
Opening Inventory | 1,25,000 | |
Sales | 4,95,000 | |
Purchases | 3,55,000 | |
Purchase return | 12,000 | |
Carriage inward | 2,500 | |
Dividend received | 6,800 | |
Auditor's fees | 5,200 | |
Income Tax Refund | 4,500 | |
Interest on Refund of Income Tax | 600 | |
Salaries and wages | 80,000 | |
Dividend paid | 12,500 | |
Advertisement on share buy back | 8,500 |
Answer:
You are required to prepare a statement of Profit and Loss after considering the following:
(i) Closing Stock on 31.3.2019 is Rs. 1,80,000
(ii) Outstanding Wages Rs. 600.
13. Prepare Statement of Profit and Loss from the following balances extracted from the books of Unique Traders Ltd. a company engaged in manufacturing of consumer goods, for the year ended 31st March, 2019 :
| Rs. |
Sales | 9,90,000 |
Cost of Materials Consumed | 3,70,000 |
Sale of Scrap | 14,000 |
10% Debentures (issued on 1st April, 2018) | 1,50,000 |
Interest on debentures paid | 7,500 |
Depreciation on Machinery | 15,000 |
Wages | 91,000 |
Manufacturing Expenses | 35,000 |
Loss on Issue of Debentures to be |
|
Amortized this year | 2,00 |
Rent paid | 18,000 |
Staff | 34,000 |
14. From the following extract of the trial balance of ABC Co. Ltd., prepare a statement of profit and Loss for the year ended 31st March, 2019.
Particulars | Amount (Rs.) | Particulars | Amount (Rs.) |
Calls in Advance Custom duty Wages Salaries Insurance Premium Auditor’s fee Interest on Debenture paid Machinery Purchases General Expenses Opening Inventory Directors’ fee | 4,000 3,200 34,600 92,500 3,200 2,700 7,000 4,00,000 1,80,000 7,800 56,000 56,000 2,000 | Sales Profit on Consignment Profit on joint Venture Interest Received Bad Debt Recovered | 5,80,000 23,000 12,000 4,000 2,600 |
Additional information :
(i) Depreciate machinery @ 10%
Answer:
(ii) Outstanding salary Rs. 6,000
Answer:
(iii) Closing Inventory Rs. 92,000
Answer:
(iv) Goods distributed as free samples Rs. 2,000;
Answer:
(v) 25% of the Insurance Premium relates to next year.
Answer:
15. From the following particulars of Hare Krishna Ltd., prepare Statement of Profit and Loss for year ended 31st March, 2019. Notes not required.
Sales Purchases Opening stock of finished goods Closing stock of finished goods Interest received Dividend received Profit on Sale of Investments Purchase Returns Wages Printing & Stationery Salaries Depreciation on Machinery General expenses Bank Charges Interest on debentures Provision for taxation for 2018-19 Transfer to General Reserve Profit and Loss (Cr.) (Balance on 1-4-2018) | Rs. 4,85,000 1,52,500 25,000 5,000 12,000 8,000 3,500 2,000 15,000 3,750 34,000 5,000 4,900 500 4,500 14,500 5,000 23,500 |
16. From the Following balances and information, you required to prepare Statement of Profit and Loss of Ugratara Ltd. For the year ended 31.3.2019. Notes not required..
|
Rs. | |
Sales | 2,95,000 |
Cost of goods sold | 1,21,000 |
Administrative expenses | 37,000 |
Import license fee | 3,000 |
Dividend received | 6,000 |
Salesmen’s Commission | 9,500 |
Selling expenses | 3,000 |
Provision for tax 30% | |
Proposed dividend 20% | |
Share capital | 90,000 |
Surplus in the Profit and Loss Statement (1-4-2018) | 23,000 |
Transfer to General Reserve 20% |
Dr. | Cr. | ||
Particulars | Amount (Rs.) | Particulars | Amount (Rs.) |
General Expenses Salaries Bad-debts Debenture Interest paid Preliminary expenses Opening Stock Wages Sundry Debtors Plant and machinery Direct Expense Discount Allowed Discount in issue of Debentures Purchases | 6,700 62,200 3,150 12,000 5,000 1,10,000 82,800 90,000 3,00,000 24,000 1,000 15,000 1,30,000 | Discount received 8% Bank Loan (Loan taken on 1.10.2018) Royalty received 12% Debentures Sales Provision for Bad debt | 2,000 50,000 4,000 2,00,000 4,90,000 5,600 |
12,000 equity shares of Rs. 100 each | 12,00,000 |
Sundry Creditors | 1,60,000 |
Bank Loan | 1,00,000 |
Proposed dividend | 60,000 |
10% Debentures | 5,00,000 |
General Reserve | 1,10,000 |
Securities Premium | 60,000 |
Surplus in the Statement of Profit and Loss on 31-3-2019 | 3,20,000 |
Live Stock | 1,70,000 |
Land and Building | 6,60,000 |
Cash at Bank | 90,000 |
Cash in Head | 10,000 |
Stock in Trade | 3,20,000 |
Furniture and Fixture | 2,00,000 |
Plant and Machinery | 7,00,000 |
Sundry Debtors | 2,70,000 |
Bills Receivable | 60,000 |
Loose Tools | 30,000 |
Particulars | Amount (Rs.) | Particulars | Amount (Rs.) |
80,000, equity shares of Rs. 10 each, Rs. 9 called up 15% Debentures Debenture Redemption Reserve General Reserve Prepaid Insurance Surplus in the Statement of P&L Bank Overdraft Land & Building Plant & Machinery Sundry | 7,20,000 2,00,000 1,32,000 2,00,000 2,000 2,86,000 30,000 6,50,000 5,80,000 1,30,000 | Securities Premium Reserve Provision for Income tax Closing Stock Cash in hand Advance Income tax Sundry Creditors Outstanding Expenses Calls in arrears Patents Investments | 50,000 48,000 2,73,000 24,000 8,000 30,400 9,600 4,000 14,400 1,40,000 |
Debit Balance | Amount (Rs.) | Credit Balance | Amount (Rs.) |
Goodwill Land & Building Machinery Sundry Debtors Interim Dividend 10% IDBI Bonds Cash in hand UBI Account Loss on issue of debenture Patent Debts due by Directors Interest on Debenture Income tax paid in advance | 25,000 1,40,000 1,00,000 82,000 6,000 30,000 6,400 35,000 2,000 1,00,000 8,000 3,000 12,000 | Sundry Equity Share Capital (Rs. 10 Each) 7% Debentures Unclaimed dividend Securities Premium Reserve General Reserve Employees Accident Insurance Fund Surplus in the Statement of Profit & Loss (1.4.2018) Unpaid wages Forfeited Shares | 76,000 2,90,000 1,00,000 1,500 4,000 18,000 9,000 8,900 2,000 10,000 |
Debit Balance | Rs. | Credit Balance | Rs. |
Investment Calls in Arrear Wages Salaries Insurance Premium Purchases Land & Building Machinery Furniture Custom Duty Directors’ sitting fees Bills Receivable General Expenses Sundry Debtors Opening Inventory Preliminary Expenses Cash at Bank Cash in Hand | 1,35,000 1,000 31,400 52,200 4,800 1,60,000 90,000 3,00,000 25,000 3,800 3,000 27,200 6,900 50,000 60,000 6,000 13,800 900 | Share Capital (Called up) Sales Commission sundry Receipts Bills Payable Securities Premium Reserve Sundry Creditors General Reserve Profit on Consignment Loan from Bank | 5,00,000 3,45,000 4,000 1,000 7,000 12,000 21,000 25,000 11,000 45,000 |
9,71,000 | 9,71,000 |
Debit | Amount (Rs.) | Credit (Rs.) | Amount(Rs.) |
Opening Inventory Purchases Wages Commission Management Expenses Trade mark Bonus Debtors Investment in Mutual Fund Machinery Bank Bad debts | 50,000 3,50,000 1,70,000 9,000 1,20,000 38,000 20,000 31,000 50,000 1,50,000 30,000 2,29,000 14,000 | Sales Discount Bad debt recovered Creditors Reserve Loan from IFCI Shares Capital (Share of Rs. 10 Rs each) Income tax Refund Outstanding Salary Statement of profit & Loss (1-4-2018) | 7,00,000 6,000 6,000 80,000 41,000 31,000 15,000 20,000 12,000 |
12,61,000 | 12,61,000 |
Debit | Amount (Rs.) | Credit | Amount (Rs.) |
Opening Inventory Purchases Building Patent Right Wages Custom duty on purchase Carriage Furniture Salaries Audit Fees Directors’ Commission Advertisement Coal & Coke Cash at Bank Prepaid Wages Petty Expenses Provident Fund Investment Machinery at cost (including Rs. 10,000 new) Sundry Debtors Bad Debts Rent, Rates & Taxes Share listing fees Calls in arrears | 30,000 1,10,000 1,20,000 5,000 20,000 3,000 3,000 9,000 50,000 6,000 6,000 24,000 2,000 14,000 1,000 4,000 25,000 60,000 20,000 3,000 4,000 4,000 3,000 | Sales IFIC Loan Public Deposit Provision for bad debt Bank Loan Provident Fund Sundry Creditors Outstanding Salary Called up Share Capital Outstanding Rent Bills payable Calls in Advance | 3,80,000 5,000 5,000 1,000 34,000 20,000 20,000 4,000 90,000 400 5,000 1,000 |
5,66,000 | 5,66,000 |
Debit | Amount (Rs.) | Credit | Amount (Rs.) |
Calls in arrear Land & Building Machinery Carriage Salary & Wages Furniture Bank Change Coal, Gas & Water Rent General Expenses Debtors Opening Stock 10% Investment on 30.9.2018 Cash in hand Cash at Bank Preliminary Expenses Purchases Bill Receivable Loss on issue of debenture Statement of Profit & Loss (Loss) Advance to Staff | 5,000 1,50,000 1,00,000 5,400 40,000 30,000 100 1,000 6,000 15,000 82,000 55,000 30,000 1,400 5,000 3,000 2,50,000 2,000 10,000 10,000 2,000 | Authorised Capital (5,000 Shares of Rs. 10 each) Subscribed Capital (30,000 Shares of Rs. 10 each) Fully Called Creditors 6% Debentures Securities Premium Unpaid Wages Discount Received Sundry Receipts Sales Public Deposit Bills Payable Provision for bad debt | 3,00,000 40,000 25,000 3,000 1,000 1,000 500 4,03,000 20,000 5,000 500 2,000 |
8,02,900 | 8,02,900 |
Unit 1
FINAL ACCOUNTS OF COMPANIES
I: Objective Type Questions:
A: State whether the following statements are 'True' or 'False':
(i) Section 129 deals with form and contents of the Balance Sheet and Profit & Loss Account.
Answer: True
(ii) Schedule III dose not contain the heading "Miscellaneous Expenditure" in Balance Sheet.
Answer: True;
(iii) Interim dividend is a dividend which is declared between two annual general meetings.
Answer: True
(iv) A company must pay Corporate Dividend Tax or Dividend Distribution Tax as and when any dividend is declared by the company.
Answer: True
(v) Preliminary expenses are those expenses which are incurred on the winding up of a company.
Answer: False
(vi) Outstanding debenture interest is shown under the head "Non-Current Liabilities".
Answer: False
(vii) Investments made by a Joint stock Company is shown is on the assets side under the head Fixed Assets.
Answer: False
(viii) Appropriation of profit such as dividend is shown in the statement of profit and loss.
Answer: False
(ix) Live Stock is treated as intangible assets.
Answer: False
(x) Debenture issued by a company is shown under the head "Short Term Borrowings".
Answer: False
B: Fill in the Blanks:
(i) Expenses incurred at the time of formation of a company is termed as _________ expenses.
Answer: Preliminary expenses
(ii) _________ is the fee which a company is required to pay to get their shares listed in a stock exchange.
Answer: Share listing fee
(iii) _________ is a system of gradation of a company about its relative capacity in respect of timely repayment of interest and principal of a particular type of debt.
Answer: Credit rating
(iv) Interest on debenture is a _________ again profits.
Answer: Charge
(v) on Issue of shares in shown on the liabilities side of the balance sheet under the head ____________.
Answer: Reserves & Surplus
(vi) ____________ is a temporary account, required to be opened in order to be opened in order to complete the double entry in respect of share capital or debentures.
Answer: Share Suspense Account
(vii) A company is required to open a separate bank account for the payment of ____________.
Answer: dividend
(viii) Preparation of financial statement of a company as per revised schedule VI is mandatory from the financial year ____________.
Answer: 2011-12
(ix) Appropriation of profits is shown in ____________ the to Accounts.
Answer: Notes
(x) Deficit in Statement of Profit and Loss is shown in the Balance under as deduction from ____________.
Answer: Reserves
(xi) Remuneration paid to an auditor is shown in the statement of profit and Loss as Other Expenses under the main head ____________.
Answer: Expenses
II. Short Answer Type Questions:
(i) What is meant by Current Assets? When an asset shall be classified as current under the revised format of Balance Sheet?
Answer:
(ii) What is meant by Non-Current Assets? When an asset shall be classified as non-current under the revised format of Balance Sheet?
Answer:
(iii) What is meant by Current Liabilities? When a liability shall be classified as current under the revised format of Balance Sheet?
Answer:
(iv) Give meaning of Deferred Tax Liabilities.
Answer:
(v) Explain the term 'Deferred Tax Asset'.
Answer:
(vi) State the accounting treatment of 'Preliminary expenses'.
Answer:
(vii) Write the accounting treatment of 'CENVAT Credit' in the final accounts of a company.
Answer:
(viii) Write the accounting treatment of 'Loss on issue of Debentures' in the final accounts of a company.
Answer:
(ix) Mention the source of creation of Investors Education and Protection Fund.
Answer:
(x) Explain how the Loss incurred by a company in a particular year will be disclosed in the balance sheet.
Answer:
(xi) Write a note on 'Corporate Dividend Tax'.
Answer:
(xii) Write a note on 'Interim Dividend'.
Answer:
(xiii) Described the treatment of proposed dividend in Company final Account.
Answer:
III. Long Answer Type Questions:
1. State the statutory provisions relating to preparation and presentation of final accounts.
Answer:
2. How would you deal with the following items while preparing the final accounts of a company?
Answer:
(a) Fees for Credit Rating
Answer:
(b) Filing fee with the Registrar of Companies
Answer:
(c) Share Suspense Account
Answer:
(d) Transfer Fee
Answer:
(e) Corporate Dividend Tax
Answer:
(f) Unpaid Dividend
Answer:
(g) Director's fees
Answer:
(h) Managerial Remuneration
Answer:
(i) Preliminaryexpenses
Answer:
(j) Proposed dividend.
Answer:
3. Explain Deferred Tax liabilities and state how it is calculated with the help of an example.
Answer:
IV. Practical Problems:
1. The Following are the extracts from the trial balance of a company on 31st March, 2019:
| Dr. Amount Rs. | Cr. Amount Rs. |
Provision for tax (2017-2018) | - | 40,000 |
Advance tax paid for (2017-2018) | 36,000 | - |
Advance tax paid for (2018-2019) | 20,000 | - |
Tax deducted at source (2018-2019) | 2,000 | - |
Surplus in the Statement of Profit & loss (2017-2019) | - | 40,000 |
Rs. | |
Interest on loans given | 14,80,000 |
Fees received for processing loans | 2,60,000 |
Profit on sale of Building | 1,40,000 |
Profit on sale of Investments | 65,000 |
Dividends Received | 75,000 |
Sale of Miscellaneous items | 8,100 |
Interest received on deposit | |
With other Financial institution | 80,000 |
SMS charges recovered from clients | 16,500 |
Rs. | |
Inventory of Materials on 1st April, 2018 | 1,40,000 |
Purchases of Materials | 6,95,000 |
Return of Materials Purchased | 7,000 |
Stores and spare parts used | 4,000 |
Lubricants purchased and Used | 1,800 |
Inventory of Materials on 31st March, 2019 | 1,50,000 |
| 31-3-2019 (Rs.) | |
Finished Goods | 2,95,000 | 2,40,000 |
Work-in-Progress (Sami-Finished-Goods) | 1,30,000 | 1,60,000 |
Stock-in Trade | 2,15,000 | 1,70,000 |
Materials | 75,000 | 50,000 |
Purchase of Materials during 2018-19 Rs. 4,50,000 | ||
Purchase Returns during 2018-19 13,000 |
Rs. | ||||||||||||||||||||
Sales | 3,60,000 | |||||||||||||||||||
Purchases | 1,75,000 | |||||||||||||||||||
Opening stock of finished goods | 40,000 | |||||||||||||||||||
Closing stock of finished goods | 20,000 | |||||||||||||||||||
Interest received | 12,000 | |||||||||||||||||||
Dividend received | 4,000 | |||||||||||||||||||
Wages | 14,000 | |||||||||||||||||||
Salaries | 22,000 | |||||||||||||||||||
Depreciation on Machinery | 10,000 | |||||||||||||||||||
General expenses | 15,000 | |||||||||||||||||||
Interest on debentures | 6,000 | |||||||||||||||||||
Provision for taxation | 20,000 | |||||||||||||||||||
Transfer to General Reserve | 14,000 | |||||||||||||||||||
Surplus in the Statement of Profit and Loss (on 1-4-2018) Answer: 9. The following is the extract of Trial Balance of Gauripur Ltd. as on 31at March, 2019.
|
(Rs.) | |
Sales | 5,80,000 |
Purchases | 1,90,000 |
Custom Duty | 4,000 |
Wages | 34,000 |
Salaries | 92,000 |
General Expenses | 7,000 |
Opening Inventory | 62,000 |
Dividend received | 4,000 |
Income Tax Refund | 3,500 |
Machinery | 6,00,000 |
Opening inventory | 60,00 |
Purchase Return | 15,000 |
Purchases | 2,55,000 |
Sales | 3,90,000 |
Salaries and Wages | 60,000 |
Dividend received | 4,200 |
Freight Inward | 1,200 |
Carriage outward | 2,300 |
Bad debts | 1,100 |
Cost of Printing of Annual Report | 4,500 |
Auditor’s fee | 3,200 |
Commission to Directors | 6,000 |
Opening Inventory | 1,25,000 | |
Sales | 4,95,000 | |
Purchases | 3,55,000 | |
Purchase return | 12,000 | |
Carriage inward | 2,500 | |
Dividend received | 6,800 | |
Auditor's fees | 5,200 | |
Income Tax Refund | 4,500 | |
Interest on Refund of Income Tax | 600 | |
Salaries and wages | 80,000 | |
Dividend paid | 12,500 | |
Advertisement on share buy back | 8,500 |
Answer:
You are required to prepare a statement of Profit and Loss after considering the following:
(i) Closing Stock on 31.3.2019 is Rs. 1,80,000
(ii) Outstanding Wages Rs. 600.
13. Prepare Statement of Profit and Loss from the following balances extracted from the books of Unique Traders Ltd. a company engaged in manufacturing of consumer goods, for the year ended 31st March, 2019 :
| Rs. |
Sales | 9,90,000 |
Cost of Materials Consumed | 3,70,000 |
Sale of Scrap | 14,000 |
10% Debentures (issued on 1st April, 2018) | 1,50,000 |
Interest on debentures paid | 7,500 |
Depreciation on Machinery | 15,000 |
Wages | 91,000 |
Manufacturing Expenses | 35,000 |
Loss on Issue of Debentures to be |
|
Amortized this year | 2,00 |
Rent paid | 18,000 |
Staff | 34,000 |
14. From the following extract of the trial balance of ABC Co. Ltd., prepare a statement of profit and Loss for the year ended 31st March, 2019.
Particulars | Amount (Rs.) | Particulars | Amount (Rs.) |
Calls in Advance Custom duty Wages Salaries Insurance Premium Auditor’s fee Interest on Debenture paid Machinery Purchases General Expenses Opening Inventory Directors’ fee | 4,000 3,200 34,600 92,500 3,200 2,700 7,000 4,00,000 1,80,000 7,800 56,000 56,000 2,000 | Sales Profit on Consignment Profit on joint Venture Interest Received Bad Debt Recovered | 5,80,000 23,000 12,000 4,000 2,600 |
Additional information :
(i) Depreciate machinery @ 10%
Answer:
(ii) Outstanding salary Rs. 6,000
Answer:
(iii) Closing Inventory Rs. 92,000
Answer:
(iv) Goods distributed as free samples Rs. 2,000;
Answer:
(v) 25% of the Insurance Premium relates to next year.
Answer:
15. From the following particulars of Hare Krishna Ltd., prepare Statement of Profit and Loss for year ended 31st March, 2019. Notes not required.
Sales Purchases Opening stock of finished goods Closing stock of finished goods Interest received Dividend received Profit on Sale of Investments Purchase Returns Wages Printing & Stationery Salaries Depreciation on Machinery General expenses Bank Charges Interest on debentures Provision for taxation for 2018-19 Transfer to General Reserve Profit and Loss (Cr.) (Balance on 1-4-2018) | Rs. 4,85,000 1,52,500 25,000 5,000 12,000 8,000 3,500 2,000 15,000 3,750 34,000 5,000 4,900 500 4,500 14,500 5,000 23,500 |
16. From the Following balances and information, you required to prepare Statement of Profit and Loss of Ugratara Ltd. For the year ended 31.3.2019. Notes not required..
|
Rs. | |
Sales | 2,95,000 |
Cost of goods sold | 1,21,000 |
Administrative expenses | 37,000 |
Import license fee | 3,000 |
Dividend received | 6,000 |
Salesmen’s Commission | 9,500 |
Selling expenses | 3,000 |
Provision for tax 30% | |
Proposed dividend 20% | |
Share capital | 90,000 |
Surplus in the Profit and Loss Statement (1-4-2018) | 23,000 |
Transfer to General Reserve 20% |
Dr. | Cr. | ||
Particulars | Amount (Rs.) | Particulars | Amount (Rs.) |
General Expenses Salaries Bad-debts Debenture Interest paid Preliminary expenses Opening Stock Wages Sundry Debtors Plant and machinery Direct Expense Discount Allowed Discount in issue of Debentures Purchases | 6,700 62,200 3,150 12,000 5,000 1,10,000 82,800 90,000 3,00,000 24,000 1,000 15,000 1,30,000 | Discount received 8% Bank Loan (Loan taken on 1.10.2018) Royalty received 12% Debentures Sales Provision for Bad debt | 2,000 50,000 4,000 2,00,000 4,90,000 5,600 |
12,000 equity shares of Rs. 100 each | 12,00,000 |
Sundry Creditors | 1,60,000 |
Bank Loan | 1,00,000 |
Proposed dividend | 60,000 |
10% Debentures | 5,00,000 |
General Reserve | 1,10,000 |
Securities Premium | 60,000 |
Surplus in the Statement of Profit and Loss on 31-3-2019 | 3,20,000 |
Live Stock | 1,70,000 |
Land and Building | 6,60,000 |
Cash at Bank | 90,000 |
Cash in Head | 10,000 |
Stock in Trade | 3,20,000 |
Furniture and Fixture | 2,00,000 |
Plant and Machinery | 7,00,000 |
Sundry Debtors | 2,70,000 |
Bills Receivable | 60,000 |
Loose Tools | 30,000 |
Particulars | Amount (Rs.) | Particulars | Amount (Rs.) |
80,000, equity shares of Rs. 10 each, Rs. 9 called up 15% Debentures Debenture Redemption Reserve General Reserve Prepaid Insurance Surplus in the Statement of P&L Bank Overdraft Land & Building Plant & Machinery Sundry | 7,20,000 2,00,000 1,32,000 2,00,000 2,000 2,86,000 30,000 6,50,000 5,80,000 1,30,000 | Securities Premium Reserve Provision for Income tax Closing Stock Cash in hand Advance Income tax Sundry Creditors Outstanding Expenses Calls in arrears Patents Investments | 50,000 48,000 2,73,000 24,000 8,000 30,400 9,600 4,000 14,400 1,40,000 |
Debit Balance | Amount (Rs.) | Credit Balance | Amount (Rs.) |
Goodwill Land & Building Machinery Sundry Debtors Interim Dividend 10% IDBI Bonds Cash in hand UBI Account Loss on issue of debenture Patent Debts due by Directors Interest on Debenture Income tax paid in advance | 25,000 1,40,000 1,00,000 82,000 6,000 30,000 6,400 35,000 2,000 1,00,000 8,000 3,000 12,000 | Sundry Equity Share Capital (Rs. 10 Each) 7% Debentures Unclaimed dividend Securities Premium Reserve General Reserve Employees Accident Insurance Fund Surplus in the Statement of Profit & Loss (1.4.2018) Unpaid wages Forfeited Shares | 76,000 2,90,000 1,00,000 1,500 4,000 18,000 9,000 8,900 2,000 10,000 |
Debit Balance | Rs. | Credit Balance | Rs. |
Investment Calls in Arrear Wages Salaries Insurance Premium Purchases Land & Building Machinery Furniture Custom Duty Directors’ sitting fees Bills Receivable General Expenses Sundry Debtors Opening Inventory Preliminary Expenses Cash at Bank Cash in Hand | 1,35,000 1,000 31,400 52,200 4,800 1,60,000 90,000 3,00,000 25,000 3,800 3,000 27,200 6,900 50,000 60,000 6,000 13,800 900 | Share Capital (Called up) Sales Commission sundry Receipts Bills Payable Securities Premium Reserve Sundry Creditors General Reserve Profit on Consignment Loan from Bank | 5,00,000 3,45,000 4,000 1,000 7,000 12,000 21,000 25,000 11,000 45,000 |
9,71,000 | 9,71,000 |
Debit | Amount (Rs.) | Credit (Rs.) | Amount(Rs.) |
Opening Inventory Purchases Wages Commission Management Expenses Trade mark Bonus Debtors Investment in Mutual Fund Machinery Bank Bad debts | 50,000 3,50,000 1,70,000 9,000 1,20,000 38,000 20,000 31,000 50,000 1,50,000 30,000 2,29,000 14,000 | Sales Discount Bad debt recovered Creditors Reserve Loan from IFCI Shares Capital (Share of Rs. 10 Rs each) Income tax Refund Outstanding Salary Statement of profit & Loss (1-4-2018) | 7,00,000 6,000 6,000 80,000 41,000 31,000 15,000 20,000 12,000 |
12,61,000 | 12,61,000 |
Debit | Amount (Rs.) | Credit | Amount (Rs.) |
Opening Inventory Purchases Building Patent Right Wages Custom duty on purchase Carriage Furniture Salaries Audit Fees Directors’ Commission Advertisement Coal & Coke Cash at Bank Prepaid Wages Petty Expenses Provident Fund Investment Machinery at cost (including Rs. 10,000 new) Sundry Debtors Bad Debts Rent, Rates & Taxes Share listing fees Calls in arrears | 30,000 1,10,000 1,20,000 5,000 20,000 3,000 3,000 9,000 50,000 6,000 6,000 24,000 2,000 14,000 1,000 4,000 25,000 60,000 20,000 3,000 4,000 4,000 3,000 | Sales IFIC Loan Public Deposit Provision for bad debt Bank Loan Provident Fund Sundry Creditors Outstanding Salary Called up Share Capital Outstanding Rent Bills payable Calls in Advance | 3,80,000 5,000 5,000 1,000 34,000 20,000 20,000 4,000 90,000 400 5,000 1,000 |
5,66,000 | 5,66,000 |
Debit | Amount (Rs.) | Credit | Amount (Rs.) |
Calls in arrear Land & Building Machinery Carriage Salary & Wages Furniture Bank Change Coal, Gas & Water Rent General Expenses Debtors Opening Stock 10% Investment on 30.9.2018 Cash in hand Cash at Bank Preliminary Expenses Purchases Bill Receivable Loss on issue of debenture Statement of Profit & Loss (Loss) Advance to Staff | 5,000 1,50,000 1,00,000 5,400 40,000 30,000 100 1,000 6,000 15,000 82,000 55,000 30,000 1,400 5,000 3,000 2,50,000 2,000 10,000 10,000 2,000 | Authorised Capital (5,000 Shares of Rs. 10 each) Subscribed Capital (30,000 Shares of Rs. 10 each) Fully Called Creditors 6% Debentures Securities Premium Unpaid Wages Discount Received Sundry Receipts Sales Public Deposit Bills Payable Provision for bad debt | 3,00,000 40,000 25,000 3,000 1,000 1,000 500 4,03,000 20,000 5,000 500 2,000 |
8,02,900 | 8,02,900 |
