Amitbhai and Narendrabhai are in Partnership Sharing Profits and Losses equally. Year ended 31st March, 2019 and Balance Sheet as on that date.Trial Balance as on 31st March, 2019 - Book Keeping and Accountancy

Balbharati solutions for Book-keeping and Accountancy 12th Standard Hsc Maharashtra State Board 

Chapter 1 Introduction to Partnership and Partnership Final Accounts Practise Problem [Pages 54 - 61]

Practise Problem | Q 1 | Page 54

1. Amitbhai and Narendrabhai are in Partnership Sharing Profits and Losses equally. From the following Trial Balance and Adjustments given below, you are required to prepare Trading and Profit and Loss Account for the year ended 31st March 2019 and Balance Sheet as on that date.

 Trial Balance as on 31st March 2019

Debit Balance	Amount ₹	Credit Balance	Amount ₹
Plant & Machinery	2,80,000	Capital A/c :
Factory Building	75,000	Amitbhai	3,50,000
Sundry Debtors	28,700	Narendrabhai	3,00,000
Purchases	85,500	Sales	1,80,000
Bad Debts	500	Bills Payable	8,500
Sales Return	2,200	Discount	1,200
10% Govt. Bond (Purchased on 1st Oct 2018)	40,000	Creditors	38,500
Import Duty	1,800	R.D	2,700
Legal Charges	2,000	Bank Loan	15,000
Motive Power	12,000	Purchases Return	2,000
Warehouse Rent	1,800
Cash in Hand	20,000
Cash at Bank	70,000
Advertisement (for 2 years, w.e.f 1st Jan 2019)	10,000
Salaries	3,800
Rent	1,500
Drawings :
Amitbhai	2,400
Narendrabhai	3,200
Furniture	1,95,800
Bills Receivable	20,700
Freehold Property	41,000
	8,97,900		8,97,900

Adjustments :

1) Stock on hand on 31st March 2019 was valued at  ₹ 43,000.

2) Uninsured goods worth ₹ 8,000 were stolen.

3) Create R.D.D at 2% on Sundry debtors.

4) Mr. Patil, our customer became insolvent and could not pay his debts of ₹ 500.

5) Outstanding Expenses - Rent ₹ 800 and Salaries ₹ 300

6) Depreciate Factory Building by ₹ 2,500 and Furniture by ₹ 1,800

 

SOLUTION: 

In the books of Amitbhai and Narendrabhai Trading and Profit and Loss Account for the year ended on 31st March 2019

Dr.						Cr.
Particulars		Amount  ₹	Amount  ₹	Particulars	Amount  ₹	Amount  ₹
To Purchases		85,500		By Sales	1,80,000
Less: Purchase Return		2,000	83,500	Less: Sales Return	2,200	1,77,800
To Import Duty			1,800	By Closing Stock		43,000
To Motive Power			12,000	By Goods Stolen Away		8,000
To Depreciation - Factory Building			2,500
To Gross Profit c/d			1,29,000
			2,28,800			2,28,800
To Warehouse Rent			1,800	By Gross Profit b/d		1,29,000
To R.B.D.D. A/C				By Discount		1,200
Bad debts		500		By O/s Interest on Govt. Bonds		2,000
Add: New Bad debts		500		By R.B.D.D. A/c (Excess Reserve) (2,700 – 1,564)		1,136
Add: New Reserve		564
		1564
Less: Old Reserve		2700
To Legal Charges			2,000
To Advertisement Expenses		10,000
less: Prepaid Adv. Exp.		8,750	1250
To Salaries		3,800
Add: O/s Salaries		300	4100
To Rent		1500
Add: O/s Rent		800	2,300
To Depreciation on Furniture			1,800
To Loss due to Theft			8,000
To Net Profit Transferred to Capital A/c
Amitbhai		56,043
Narendrabhai		56,043	1,12,086
			1,33,336			1,33,336

 

Balance Sheet as on 31st March 2019

Liabilities	Amount ₹	Amount ₹	Assets	Amount ₹	Amount ₹
Capital Account: Amitbhai			Plant & Machinery		2,80,000
Opening Balance	3,50,000		Factory Building	75,000
Add: Net Profit	56,043		Less: Depreciation	2,500	72,500
Less: Drawings	2,400	4,03,643	Closing Stock		43,000
			Sundry Debtors	28,700
Capital Account: Narendrabhai			Less: B.D. (New)	500
Opening Balance	3,00,000			28,200
Add: Net Profit	56,043		Less: R.D.D. (New)	564	27,636
Less: Drawings	3,200	3,52,843	10 % Govt. Bond		40,000
Bills Payable		8,500	O/s Interest on Govt. Bond		2,000
Creditors		38,500	Cash in Hand		20,000
Bank Loan		15,000	Cash at Bank		70,000
Outstanding expenses			Prepaid Advertisement Expense		8,750
Rent	800		Furniture	1,95,800
Salaries	300	1,100	Less: Depreciation	1,800	1,94,000
			Bills Receivable		20,700
			Freehold property		41,000
		8,19,586			8,19,586

 

Notes :

(1) Import duty, Motive power, and Depreciation on Factory building are recorded in the Trading A/c.

(2) 10 % govt. bond is an investment. It was purchased on 1 – 10 – 2018.

Interest is calculated for six months.

Interest on Govt. Bond = ₹ 40,000 X (6/12) X 10% =₹  2,000

(3) Adv. exp. paid for 2 years from 01 – 01 – 2019. Up to 31 – 3 – 2019, 3 months adv. exp. is written off to Profit and Loss A/c. It is calculated as below : 10000 X (3/24) = ₹1250

Prepaid adv. exp. 10,000 – 1,250 = ₹ 8,750

Balbharati Solutions for Book-keeping and Accountancy 12th Standard Hsc Maharashtra State Board.

Chapter 1: Introduction to Partnership and Partnership Final Accounts

 

Select the most appropriate alternative from the following & rewrite the sentence.

Write the word/phrase/term, which can substitute the following sentence.

State whether the following statement is True or False with reasons.

Find an odd one.

Complete the Sentence.

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Practical Problems.

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