Last Updated on: 5th July 2024, 01:45 pm
Final Accounts Compilation
Adjustments & Final Accounts compilation (1 of 5)
Prepare the Adjustment entries and then Trading & Profit & Loss Account & Balance Sheet with the figures from the Books of Accounts of X
Mr. X had prepared the following Trial Balance from his Ledger as on 31.3.2016
Debits : Op. Stock (1.4.15) : 5,00,000 Dr, Purchases : 29,95,000Dr, Sales Return : 55,000Dr, Cash in Hand : 2,55,000 Dr, Cash at Bank : 5,05,000 Dr, Rates and Taxes : 50,000 Dr, Drawings : 45,000 Dr , Salaries : 1,00,000 Dr, Postage and Telegram : 1,05,000 Dr, Insurance : 94,000 Dr, Salesman Commission :78,000 Dr, Printing and Stationery :95,000 Dr, Advertisement :1,74,000 Dr, Furniture and Fittings :5,50,000 Dr, Motor Car :48,000 Dr, Discounts Allowed :55,500 Dr, General expenses: 69,700 Dr, Carriage Inward :10,000 Dr, Carriage Outward :25,000 Dr, Wages :50,000 Dr, Sundry Debtors : 10,00,000 Dr, Total Debits 68,59,200
Credits : Purchase Returns : 45,000 Cr, Sales : 40,45,000 Cr, Discount Received : 1,00,000 Cr, Sundry Creditors : 4,10,000 Cr, Capital : 22,59,200 Cr, Total Credits : 68,59,200
Adjustments to be made for : Closing Stock as on 31st March, 2016 : Rs.1,45,000, Mr. X had withdrawn goods for personal use: Rs.50,000, Purchases include Purchase of furniture : Rs.1,00,000, Debtors include Rs.50,000 bad debts Sales include goods worth Rs.1,50,000 (Costing Rs.1,00,000), sent to AKN & Co. on approval and remained unsold as on 31st March, 2016. Provision for Bad debts to be created @5% of Sundry Debtors. Depreciation for Furniture and Fittings @10%. and Motor Car @ 20%. Salesman commission payable @ 10% on total sales.
Trading Account for the period 1.4.15 to 31.3.16
| Particulars | Dr | Particulars | Cr |
| To Opening Stock | 5,00,000 | By Sales (40,45,000) – Returns (55,000) – 1,50,000 (Goods sent on approval) | 38,40,000 |
| To Purchases (29,95,000) – Returns (45,000) – Personal use (50,000) – Furniture Purch (1,00,000) | 28,00,000 | By Closing Stock (1,45,000) + Cost of goods sent on approval (1,00,000) | 2,45,000 |
| To Carriage Inward | 10,000 | ||
| To Wages | 50,000 | ||
| To Gross Profit c/d | 7,25,000 | ||
| Total | 40,85,000 | Total | 40,85,000 |
Profit and Loss Account of Mr. X for 1.4.15 to 31.3.16
Particulars Dr Particulars Cr
To Rates and Taxes 50,000 By Gross Profit b/d 7,25,000
To Salaries 1,00,000 By Discounts Received 1,00,000
To Postage and Telegram 1,05,000 By Net Loss 5,02,300
To Salesman’s comm (78,000) + Outst. (3,16,500) 3,94,500
To Insurance 94,000
To Advertisement 1,74,000
To Printing and Stationery 95,000
To Bad Debts 50,000
To Prov. for Doubtful Debts @5% on 8,00,000 40,000
To Discounts Allowed 55,500
To General Expenses 69,700
To Carriage Outward 25,000
To Deprn: Furn & Fittings (65,000) + Motor Car (9,600) 74,600
Total 13,27,300 Total 13,27,300
Balance Sheet of Mr. X as on 31st March, 2016.
| Liabilities | Assets | ||
| Capital (22,59,200) – Net Loss (5,02,300) – Drawings (45,000) – Goods withdrawn (50,000) | 16,61,900 | Furniture & Fittings (5,50,000) + Addition (1,00,000)= 6,50,000 – Depn @ 10% (65,000) | 5,85,000 |
| Motor Car (48,000) – Depn @ 20% (9,600) | 38,400 | ||
| Sundry Creditors | 4,10,000 | Sundry Debtors (10,00,000) – Sales on approval (1,50,000) – Bad Debts (50,000) = 8,00,000 – Prov for Doubtful Debt @5% (40,000) | 7,60,000 |
| Outstanding salesman’s comm. | 3,16,500 | Cash in Hand | 2,55,000 |
| Cash at Bank | 5,05,000 | ||
| Closing stock (1,45,000) + Cost of goods sent on approval (1,00,000) | 2,45,000 | ||
| Total | 23,88,400 | Total | 23,88,400 |
Adjustments & Final Accounts compilation (2 of 5)
Prepare the Adjustment entries and then Trading & Profit & Loss Account & Balance Sheet with the figures from the Books of Accounts.
Trial Balance as on 31st March 2016
Debits : Sundry Debtors : 50,000, Cash in Hand : 2,000, Furniture : 3,500, Motor Car : 15,000, Purchases : 1,25,000, Sales Return : 2,500, Salaries : 8,000, Opening Stock : 10,000, Car Expenses : 6,500, Rent and Taxes :1,000, Insurance : 2,500, Cash at Bank : 4,000, Machinery : 25,000, Wages : 23,000, General Expenses : 4,500, Carriage Inward : 2,000, Carriage Outward : 1,500, Power and Fuel : 6,000, Drawing A/c : 8,000, Total Debits : 3,00,000
Credits : Creditors : 64,000, Sales : 2,16,000, Capital A/c :20,000, Total Credits : 3,00,000
Further Adjustments to be made: Free samples costing Rs.5,000 distributed. Rs.1,000 paid for Machinery erection was debited to wages A/c. Write off further Bad Debts of Rs.2,000. Provision for Bad Debts at 10% of Sundry Debtors. Depreciation of Furniture and Machinery @15% and Motor Car @20%. Commission income outstanding Rs.3,000. Insurance Premium includes Rs.500 paid for Personal Insurance of the Proprietor. 50% of Motor Car Expenses and Depreciation is being charged to Proprietor A/c. Closing Stock was valued at Rs.37,000 on 31st March, 2016.
Trading and P L For the year ended 31st March, 2016
Particulars (Rs.) Particulars (Rs.)
To Opening Stock 10,000 By Sales (2,16,000) – Returns (2,500) 2,13,500
To Purchases 1,25,000 By Goods distributed as sample 5,000
To Wages 23,000 – Mach. Erect (1,000) 22,000 By Closing Stock 37,000
To Carriage inward 2,000
To Power and fuel 6,000
To Gross profit c/d 90,500
Total 2,55,500 2,55,500
Profit and Loss A/c For the year ended 31st March, 2016
To Salary 8,000 By Gross profit b/d 90,500
To Car exp – 50% for proprietor 3,250 By Commission receivable 3,000
To Rent and Taxes 1,000
To Insurance (2500) – for proprietor (500) 2,000
To General expenses 4,500
To Carriage outward 1,500
To Advertisement (free sample) 5,000
To Bad debts 2,000
To Provisions for bad debts 4,800
To Depn.Mach3,900+Furn525+Car1,500 5,925
To Net profit 55,525
93,500 93,500
Balance Sheet As on 31st March, 2016
| Liabilities | Rs | Assets | Rs. |
| Capital (20,000) + Profit (55,525) – Drawings (8,000) – Insurance (500) – Car Exp (3,250) – Depn on Car (1,500) | 62,275 | Furniture (3,500) – Depn @ 15% (525) | 2,975 |
| Sundry Creditors | 64,000 | Motor car (15,000) – Depn 20% (3000) | 12,000 |
| Machinery (25,000) + Add Erect Ch (1,000) =26,000 – Depn @ 15% (3,900) | 22,100 | ||
| Sundry debtors (50000) – Bad Debt (2,000) -=48,000 – Prov for Bad Debt @ 10% (4,800) | 43,200 | ||
| Closing stock | 37,000 | ||
| Com. outstanding | 3,000 | ||
| Cash in Hand | 2,000 | ||
| Cash at Bank | 4,000 | ||
| Total | 1,26,275 | Total | 1,26,275 |
Adjustments & Final Accounts compilation (3 of 5)
Prepare the Adjustment entries and then Trading & Profit & Loss Account & Balance Sheet with the figures from the Books of Accounts of Y
Trial Balance of Mr. Y as at 31st December, 2016
Debit Balances : Opening Stock : 10,000, Land and Buildings : 35,000, Machinery : 50,000, Furniture & Fixtures : 5,000, Purchases : 1,02,850, Salaries : 11,000, General Expenses : 2,500, Rent : 3,000, Postage, Telegrams : 1,500, Stationery : 2,000, Wages : 26,000, Freight on Purchases : 2,800, Carriage on Sales : 3,000, Repairs : 4,000, Sundry Debtors : 30,000, Bad Debts : 1,000, Cash in Hand : 250, Cash at Bank : 5,000, Sales Returns : 5,100 : Total Debits : 3,00,000
Credit Balances : Capital : 50,000, Loan from Mr. Amit @ 9% p.a. : 30,000, Sundry Creditors : 9,600, Purchase Returns : 2,000, Miscellaneous Receipts : 2,000, Sales ; 2,06,400. Total Credits: 3,00,000
Adjustment Entries to be made : Wages for December, 2016, Rs. 1,000 not yet been paid. General Expenses Includes Insurance premium, Rs.600, paid for the year ending March 31, 2017. Provision for Doubtful Debts @ 5% on debtors. Depreciation : Land and buildings 5%, Machinery 10% and Furniture and Fixtures 15%. Loan taken from Mr. Amit was taken on 1st July, 2010. Interest has not yet paid. Closing stock as on 31st December, 2016, Rs.15,000.
Trading Account for the year ended December 31, 2016
| Particulars | Dr | Particulars | Cr |
| To Opening Stock | 10,000 | By Sales (2,08,550) – Returns (5,100) | 2,03,450 |
| To Purchases (1,05,000) – Returns (2,000) | 1,03,000 | By Closing Stock | 15,000 |
| To Wages (26,000) + Outs (1,000) | 27,000 | ||
| To Freight on Purchases | 2,800 | ||
| To Gross Profit c/d | 75,650 | ||
| 2,18,450 | 2,18,450 |
Profit & Loss Account for the year ended December 31, 2016
Particulars Dr Particulars Cr
To Salaries 11,000 By Gross Profit b/d 75,650
To General Expenses (2,500) – Prep Ins (150) 2,350 By Miscellaneous Receipts 2,000
To Rent 3,000
To Postage & Telegrams 1,500
To Stationery 2,000
To Carriage on Sales 3,000
To Repairs 4,000
To Bad Debts 1,000
To Provision For Doubtful Debts 1,500
To Depn : L & B (1,750) + Mach (5,000) + Furn (750) 7,500
To Interest [Rs.(30,000 x 9%) x ½] 1,350
To Net Profit (Transferred to Capital A/c) 39,450
77,650 77,650
Balance Sheet As on 31st December, 2016
| Liabilities | Rs. | Assets | Rs. |
| Capital Account (50,000) + Profit (39,450) | 89,450 | Land & Buildings (35,000) – Depn (1,750) | 33,250 |
| Loan Amit (30,000) + Int [Rs.(30,000×9%) x ½]= (1,350) | 31,350 | Machinery (50,000) – Deprn @10 % (5,000) | 45,000 |
| Wages Outstanding | 1,000 | Furn (5,000) – Deprn @15% (750) | 4,250 |
| Sundry Creditors | 9,600 | S. Drs (30,000) – Prov for doubt.Debts (1,500) | 28,500 |
| Cash in Hand | 250 | ||
| Cash at Bank | 5,000 | ||
| Prepaid Insurance | 150 | ||
| Closing Stock | 15,000 | ||
| Total | 1,31,400 | Total | 1,31,400 |
Adjustments & Final Accounts compilation (4 of 5)
Prepare the Adjustment entries and then Trading & Profit & Loss Account & Balance Sheet with the figures from the Books of Accounts.
Trial Balance as at 31st March, 2015 (Debits / Credits are not specified, you have to assume)
Plant & Machinery : 40,500, Furniture and Fittings : 15,250, Bank Overdraft : 1,60,000, Capital Account : 1,15,000, Drawings : 15,000, Purchases : 2,30,500, Opening Stock : 1,32,250, Wages : 22,325, Provisions for Doubtful Debts : 5,700, Provisions for discount On Debtors : 1,375, Sundry Debtors: 1,52,500, Sundry Creditors : 77,500, Bad Debt : 2,200, Bad debt recovered :1,250, Salaries : 32,650, Salaries Payable: 5,350, Prepaid Rent : 500, Rent : 6,500, Carriage inward : 2,350, Carriage outward : 3,250, Sales : 2,90,600, Advertisement Expenses : 6,750, Printing & Stationery : 2,200, Cash in Hand : 2,300, Cash at Bank : 7,250
Adjustments :
The bank overdraft out standing as on 31.3.2015 accounted for 80% of drawing power. Such drawing power is ascertained by deducting 20% as margin from the value of stock as on that date. Purchases include Sales return of Rs.5,500. Sales include purchases returns of Rs.4,750. Goods withdrawn by M for own consumption Rs.7,500 were included in purchases. Wages paid includes installation charges of plant & machinery Rs.750. Depreciation on plant & machinery @ 15% p.a, and on furniture @10% p.a. Provision for doubtful debts required @ 5% and provision for discount on debtors @ 2 1/2%. A debit balance of Rs.2,500 in the account of Ram, a creditor, is included in the list of sundry debtors. Free samples distributed for publicity costing Rs.1,250.
Difference in the trial balance, if any, can be taken as miscellaneous income.
Rectification Entries:
- Sales Return Dr 5,500, Purchase Cr 5,500 (Amount of Sales Return included in Purchase)
- Sales Dr 4,750 Purchase Return Cr 4,750 (Amount of Purchase Return included in Sales)
- Drawing Dr 7,500, Purchase Cr 7.500 (Goods withdrawn by Proprietor for Personal use)
- Plant & Machinery Dr 750, Wages Cr 750 (Machine Installation charges included in wages)
- Advance to Supplier Dr 2,500, S. Debtors Cr 2,500 (Advance to suppliers included in S. Debtors)
- Advertisement (Free Sample) Dr 1,250, Purchase Cr 1,250 (Cost of Free Samples given for Publicity)
Trial Balance As on 31st March, 2015 (After rectification)
Debit Balances
Plant & Machinery : 41,250, Furniture & Fittings : 15,250, Drawings : 22,500, Purchases : 2,16,250, Opening Stock : 1,32,250, Wages : 21,575, Sundry Debtors : 1,50,000, Advance to suppliers : 2,500, Bad debts: 2,200, Salaries : 32,650, Prepaid rent : 500, Rent : 6,500, Carriage inward : 2,350, Carriage outward : 3,250, Returns inward : 5,500, Advertisement : 8,000, Printing & Stationery : 2,200, Cash in hand : 2,300, Cash in Bank : 7,250 : Total Debits : 6,74,275
Credit Balances
Bank Overdraft : 1,60,000, Capital account : 1,15,000, Returns outward : 4,750, Provision for doubtful debts : 5,700, Provision for discount on debtors: 1,375, Sundry Creditors : 77,500, Bad debt recovered : 1,250, Outstanding salaries or Payable Salaries : 5,350, Sales : 2,85,850. Total : 6,56,775
Misc Income (Balancing Figure) Cr: 17,500 (6,74,275 – 6,56,775). Total Credits : 6,74,275
Trading Account For the year ended 31st March, 2015
| Expenses | Dr | Income | Cr |
| To Opening Stock | 1,32,250 | By Sales (2,90,600) – Purchase return wrongly included (4,750) – Sales Return (5,500) | 2,80,350 |
| To Purchases (2,30,500) – Goods withdrawn for personal use (7,500) – Sales return wrongly included (5,500) – Purchase Return (4,750) – Free Samples (1,250) | 2,11,500 | By Closing Stock (Rs.1,60,000 x 100/90 x 100/90) | 2,50,000 |
| To Carriage inward | 2,350 | ||
| To Wages (22,375) – Instln of Plant & Mach.( 750) | 21,575 | ||
| To Gross Profit c/d ((Transferred to P & L A/c) | 1,62,675 | ||
| Total | 5,30,350 | Total | 5,30,350 |
Profit and Loss Account For the year ended 31st March, 2015
Expenses Dr Income Cr
To Salaries 32,650 By Gross Profit b/d 1,62,675
To Rent 6,500 By Bad debt recovered 1,250
To Advt(6,750) + Free sample (1250) 8,000 By Misc. Income 17,500
To Printing & Stationery 2,200
To Bad Debts 2,200
To Carriage Outward 3,250
To Prov. for doubtful debts Reqd (7,500)- Existing (5,700) 1,800
To Prov. for discount on (3,563) – (1,375) 2,188
To Depn: P M@15%(6,187) +Furn@10% (1,525) 7,712
To Net Profit (Transferred to Capital A/c) 1,14,925
1,81,425 1,81,425
Balance Sheet as on 31.3.2015
| Liabilities | Rs | Assets | Rs |
| Capital (1,15,000) + Net Profit (1,14,925) – Drawing (15,000) – Goods withdrawn (7500) | 2,07,425 | Plant & Machinery (40,500) + Installn chrges (750) = 41,250 – Depn @15% (6,187) | 35,063 |
| Bank Overdraft | 1,60,000 | Furn (15,250) – Deprn @10% (1,525) | 13,725 |
| Sundry creditors | 77,500 | Closing Stock (1,60,000 x 100/90 x 100/90) | 2,50,000 |
| Payable Salaries | 5,350 | Sundry Debtors (1,52,500) – Cr Bal included (2500) = 1,50,000 – Prov. for doubt. debts @ 5% (7,500) = 1,42,500. – Prov. for Discount @ 2.5% (3,563) | 1,38,937 |
| Advance to Suppliers | 2,500 | ||
| Prepaid Rent | 500 | ||
| Cash at Bank | 7,250 | ||
| Cash in Hand | 2,300 | ||
| 4,50,275 | 4,50,275 |
Adjustments & Final Accounts compilation (5 of 5)
Prepare the Adjustment entries and then Trading & Profit & Loss Account & Balance Sheet with the figures from the Books of Accounts.
Trial Balance as on 31st December, 2015.
Debit Balances
Purchases : 15,000, Sundry Debtors : 20,000, Salaries : 3,000, Wages : 2,000, Rent : 1,500, Sales Returns : 1,000, Bad Debts Written off : 700, Drawings : 2,400, Printing and Stationery : 800, Insurance : 1,200, Opening Stock : 5,000, Office Expenses : 1,200, Furniture and Fixture : 2,000, Total Debits : 55,800
Credit Balances
Interest Earned : 600, Sales : 32,100, Purchases Returns : 500, Sundry Creditors : 12,000, Capital Account : 10,000, Provision for Bad Debts : 600, Total Credits : 55,800
Adjustments to be made :
Depreciation Furniture and Fixture @ 10%, provision for Doubtful Debts @ 5% on Sundry Debtors, Salaries for December amounting Rs.300 were unpaid, and included Rs.200 paid in advance. Insurance is pre-paid to the extent of Rs.200. Office expenses of Rs.800 are yet to be paid. Stock costing at Rs.600 was put for personal use. Closing stock – Rs.6,000.
Trading and Account for the year ended December 31st, 2015
| Particulars | Rs. | Particulars | Rs. |
| To Opening Stock | 5,000 | By Sales (32,100) – Return (1,000) | 31,100 |
| To Purchases (15,000) – Return (500) – Personal Use (600) | 13,900 | By Closing Stock | 6,000 |
| To Wages | 2,000 | ||
| To Gross Profit c/d | 16,200 | ||
| Total | 37,100 | Total | 37,100 |
Profit and Loss Account for the year ended December 31st, 2010
| Expenses | Rs | Income | Rs |
| To Salaries (3,000) + Unpaid (300) – Adv Paid (200) | 3,100 | By Gross Profit b/d | 16,200 |
| To Office Expenses (1,200) + Outstanding (800) | 2,000 | By Interest earned | 600 |
| To Rent | 1,500 | By Provision for Bad Debts | 600 |
| To Insurance (1200) – Prepaid (200) | 1,000 | ||
| To Printing and Stationery | 800 | ||
| To Bad Debt | 700 | ||
| To Provision for Bad Debts @ 5% on Debtors (20,000) | 1,000 | ||
| To Depreciation on Furniture & Fixture @ 10% (2000) | 200 | ||
| To Net profit | 7,100 | ||
| Total | 17,400 | Total | 17,400 |
Balance Sheet as at December 31st, 2015
| Liabilities | Rs. | Assets | Rs. |
| Capital (10,000) + Net Profit (7,100) – Drawings (2,400) – Materials personal use (600) | 14,100 | Furniture (2,000) – Depn (200) | 1,800 |
| Sundry Creditors | 12,000 | Closing Stock | 6,000 |
| Outsd Expenses Office Exp(800) + Salaries (300) | 1,100 | Sundry Debtors (20,000) – Prv for Bad Debts @5% (1000) | 19,000 |
| Advances salary paid to Staff | 200 | ||
| Prepaid Insurance Expenses | 200 | ||
| 27,200 | 27,200 |
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