Ashok and Tanaji are Partners sharing Profits and Losses in the ratio 2:3 respectively.

Ashok and Tanaji are Partners sharing Profits and Losses in the ratio 2:3 respectively. (20)

Trial Balance as on 31 ^st March, 2007 [March 2010]

Particulars	Amount Rs.	Particulars	Amount Rs.
Purchases Patents Right Building Stock (1.4.2006) Printing and Stationery Sundry Debtors Wages and Salaries Audit fees Sundry expenses Furniture 10% Investment (Purchased on 30.09.2006) Cash Provident Fund Contribution Carriage Inwards Travelling Expenses	98,000 4,000 1,00,000 15,000 1,750 35,000 11,000 700 3,500 8,000 10,000 4,000 800 1,300 2,700	Capitals : Ashok Tanaji Provident Fund Creditors Bank Loan Sales Reserve for Doubtful Debts Purchase Returns	30,000 40,000 7,000 45,000 12,000 1,58,000 250 3,500
	2,95,750		2,95,750

Closing stock is valued at the Cost of Rs.15,000 while its Market Price Rs.18,000.

On 31^st March, 2007 the stock of stationery was Rs.500.

Provide reserve for bad and doubtful debts at 5% on debtors.

Depreciate building at 5% and patent rights at 10%.

Interest on capitals is to be provided at 5% p.a.

Goods worth Rs.10,000 were destroyed by fire. The Insurance company admitted a claim for Rs.8,000.

Solution:

In the books of M/s Ashok & Tanaji

Trading Account for the year ended 31.03.2007

Particulars	Amt.	Amt.	Particulars	Amt.	Amt.
To Opening Stock		15000	By Sales		158000
To Purchases	98000		By Goods destroyed  by fire		10000
(-) Return	-3500	94500
To Wages & Salaries		11000
To Carriage Inward		1300
To Gross Profit C/d		61200	By Closing Stock		15000
		183000			183000

Profit and Loss Account for the year ended 31.03.2007

Particulars	Amt.	Amt.	Particulars	Amt.	Amt.
To Printing & Stationery	1750		By Gross Profit b/d		61200
(-) Stock	500	1250	By Interest on Investments		500
To Audit Fees		700
To Sundry Expenses		3500
To Provident Fund Contribution		800
To Travelling Expenses		2700
To Bad debts	-
(+) F.B.D.	-
(+) N.R.D.D.	1750
(-) O.R.D.D.	-250	1500
To Depreciation
On Building	5000
On Patent Rights	400	5400
To Interest on Capital
Ashok	1500
Tanaji	2000	3500
To loss by fire. [10000 – 8000]		2000
To Net Profit c/d
Ashok	16140
Tanaji	24210	40350
		61700			61700

Partners Current  Account

Particulars	Ashok	Tanaji	Particulars	Ashok	Tanaji
			By Balance b/d	30000	40000
			By Interest on Capital	1500	2000
To Balance C/d	47640	66210	By Net Profit b/d	16140	24210
	47640	66210		47640	66210

Balance Sheet as on 31.12.1997

Liability	Amt.	Amt.	Assets	Amt.	Amt.
Capital A/c			Patent Rights	4000
Ashok	47640		(-) Depreciation	400	3600
Tanaji	66210	113850	Buildings	100000
Provident Fund		7000	(-) Depreciation	-5000	95000
Creditors		45000	Sundry debtors	35000
Bank Loan		12000	(-) N.R.D.D.	-1750	33250
			Furniture		8000
			10% Investments	10000
			(+) Interest	500	10500
			Cash		4000
			Closing Stock		15000
			Stock of Stationery		500
			Insurance Claim		8000
		177850			177850