14. On 31st March, 2024 the following Trial Balance was prepared from the books of Manpreet.
| Debit Balances | ₹ | Credit Balances | ₹ |
|---|---|---|---|
| Furniture | 3,400 | Capital | 1,00,000 |
| Building | 21,700 | Discount received | 2,000 |
| Drawings | 4,200 | Bank Loan | 10,000 |
| Cash at Bank | 2,470 | Purchases Return | 970 |
| Wages | 31,250 | Sales | 1,91,940 |
| Discount Allowed | 2,640 | Sundry Creditors | 12,450 |
| Bank Charges | 90 | Provision for Doubtful Debts | 800 |
| Salaries | 5,610 | ||
| Purchases | 1,32,700 | ||
| Opening Stock | 40,200 | ||
| Cash in Hand | 2,650 | ||
| Sales Return | 1,250 | ||
| Carriage Inwards | 3,400 | ||
| Machinery | 14,600 | ||
| Sundry Debtors | 43,800 | ||
| Bad Debts | 1,000 | ||
| Insurance | 1,250 | ||
| Rent | 2,450 | ||
| Advertisement | 3,500 | ||
| Total | 3,18,160 | Total | 3,18,160 |
Prepare Trading and Profit & Loss Account for the year ended 31st March, 2024 and also the Balance Sheet as at that date after making the following adjustments:
(i) Closing Stock at cost was ₹35,000 whereas its net realisable value (market value) Was ₹30,000.
(ii) A new machine was purchased for ₹3,000 on 1st April, 2023 but it was not paid for and entry was not recorded in the books.
(iii) Wages include ₹500 paid for the installation of machinery.
(iv) Provision for Doubtful Debts was raised to ₹1,400 and further bad debts of ₹300 were written off.
(v) Fire broke out on 20th March, 2024 and destroyed stock to the value of ₹8,000. The insurance company admitted claim for loss of stock of ₹5,000 and the amount was paid on 15th April, 2024.
(vi) Outstanding wages were ₹700 while outstanding salaries were ₹500.
(vii) Prepaid insurance was 250 and prepaid advertisement ₹500.
(viii) Machinery was depreciated by 10% and furniture by 15%.
T.S.Grewal/2024 Edition/Practical Problems/Q-14
For full question, please refer to the text book T.S.Grewal’s Double Entry Book Keeping-Financial Accounting, Textbook for CBSE Class XI published by Sultan Chand & Sons Pvt. Ltd.
