Financial Statements of Non-Corporate Business Entities

1. From the following trial balance and additional information prepare the Trading and Profit & Loss Account of
Mr. Mukul for the year ended 31st March, 2022 and Balance sheet as at that date

Particulars Dr Cr
Capital/Drawings 10,000 1,70,000
Plant & Machinery 1,10,000
Sales/Purchase 84,000 1,65,000
Returns 5,000 4,000
Bad Debts/ Bad debts recovered 5,000 26,450
Freight Inwards 5,000
Freight Outwards 7,000
Discounts 2,000 1,000
Commission 4,000 3,000
Rent 3,000 4,000
Interest 2,500 3,000
Office & administrative expenses 6,000
Selling & Distribution Expenses 10,000
Creditors/ Debtors 2,15,000 2,02,000
Bills Payable/ Bills Receivable 10,000 5,600
Loan 20,000 50,000
Investment 50,000
Opening Stock 54,000
Cash in hand 5,000
Cash at Dena bank 45,550
Bank overdraft at Canara Bank 20,000
Wages & salaries 1,000
6,54,050 6,54,050
a. Closing Stock at market price as at 31st March, 2022 was & 61,500. However, its cost was Rs. 80,000.
b. Provide for depreciation on Plant & Machinery @ 10% p.a.
c. Provide interest on capital @ 6% p.a. and an additional capital of Rs. 10,000 was introduced on 1st Oct.,
2021.
d. Charge interest on drawings @ 9% p.a.
e. Goods costing Rs.10,000 were destroyed due to fire on 30th March, 2022. The Insurance Company
accepted claim to the extent of 60% only and paid the claim money on 10th April, 2022.
f. Goods worth Rs. 10,000 were sent to a customer on approval basis and have been accounted in the books
as actual sale. These goods remained unapproved on 31st March, 2022. The cost of such goods was Rs.
8,000.
g. Received credit purchase invoice of ? 10,500 on 27th March, 2022 and recorded in the books but the
goods were not received till the end of the accounting year.
h. Manager is entitled to a commission of 5% of net profit after charging the commission.

2. From the following trial balance and additional information, prepare Trading and P/L account for the year
ending 31st March 2022and a Balance sheet as on that date:

Particulars Dr Cr
Opening Stock 30,000
Purchases (Adjusted) 4,65,000
Sales 9,75,000
Closing Stock 35,000
Land & Building 1,50,000
Machinery 4,00,000
Accumulated Depreciation
 Land & Building 25,000
Machinery 80,000
Capital 1,55,000
Bad Debts 5,000
Provision for Bad Debts 5,000
Salaries 40,000
Rent, Rates and Taxes 20,000
Trade Expenses 5,750
Depreciation on Land & Building 6,250
Depreciation on Machinery 20,000
Life Insurance Premium 5,000
Income Tax 5,000
Drawings 10,000
Insurance 5,000
Sundry Debtors& Creditors 70,000 50,000
Output CGST Rs. 9,000 and Output SGST 18,000
Rs. 9,000 paid
12,90,000 12,90,000
Adjustments:
1. Goods withdrawn by the proprietor Rs. 2,000
2. Goods amounting to Rs. 3,000 were donated by the entity.
3. Goods of Rs. 4,000 were distributed as free sample advertisements.
4. Goods costing Rs. 5,000 were destroyed by fire and the insurance company accepted a claim for Rs. 4,000,
not yet received.
5. Insurance prepaid at the end Rs. 2,000
6. Write off further bad debts of Rs. 2,000 and maintain a provision for bad and doubtful debts equal to 5% of
the sundry debtors.
7. Sales include Output CGST Rs. 10,000 and Output SGST Rs. 10,000. The proprietor is not entitled to input
tax credit as he has purchased the goods from an unregistered supplier.

3. From the following information received from the books of Mr. X on 31-3-2022 you are required to prepare
Trading and P/L account for the year ended 31st March 2022 and a Balance sheet as on that date:

Particulars Debit Particulars Credit

Plant & Machinery 18,000 Capital Account 60,000
Depreciation on Plant & 2,000 Sales 2,49,000
Machinery
Repairs to Plant 1,600 Bank Overdraft 13,800
Wages 28,000 Salaries Outstanding 2,000
Salaries 4,000 Bills Payable 3,000
Income Tax 500 Provision for Bad Debts 6,000
Cash in Hand 2,000 Sundry Creditors 23,300
Land 24,500 Discount 4,000
Depreciation on Building 2,500
Purchase less return 1,23,500
Accrued Income 1,500
Bills Receivable 30,000
Bad Debts 1,000
Sundry Debtors 35,000
Stock on 1.4.2014 37,000
Building 50,000
Total 3,61,100 Total 3,61,100
Adjustments:
a. On 31-3-2022 the cost of stock was Rs. 35,000 and its realizable value was Rs.30,000
b. Write off Rs. 3,000 bad debts and maintain a provision for bad debts of 5% on Sundry Debtors.
c. Goods costing Rs. 5000 were sent to customer on ‘sale on approval basis’ on 30-3-2022. These were recorded
as actual sales. The rate of gross profit was 1/6th of Sale.
d. Rs. 1,200 paid as rent of the office were debited to the landlord’s account and were included in S.Debtors.
e. The General Manager is to be given a commission of 10% after charging the commission of the Work
Manager and his own on net profit.
f. Work Manager is to be given a 5% commission after charging the commission of the General Manager and
his own on Net profits. Such commission should be calculated to the nearest multiple of rupee.