(1) Poojan Ltd. was registered with a nominal capital of Rs. 1,00.

00,000 divided into equity

shares of Rs.100 each.
Trial balance as on 31-3-12
Debit Balances Rs. Credit Balances Rs.
Calls in arrears 18,000 Bills payable 96,000
Plant and Machinery 8,00,000 General Reserve 62,500
Opening Stock 1,87,500 Profit and Loss appro. A/c 36,250
Fixtures 18,000 Equity Share Capital 11,50,000
Debtors 2,17,500 6% Debenture 6,50,000
Building 7,50,000 Sales 10,37,500
Purchases 4,62,500 Provision for bad debts 8,000
Interim Dividend paid 18,750 Creditors 1,30,000
Rent 13,000
General Expenses 12,250
Debenture Interest 22,500
Preliminary Expenses 12,500
Freight 32,750
Goodwill 62,500
Wages 2,12,000
Cash 5,950
Bank 95,750
Directors fees 14,350
Bad debts 5,200
Commission 18,000
Salaries 36,250
4% Government Securities 1,55,000
Total 31,70,250 Total 31,70,250
Additional information:
1. The closing stock was estimated Rs.1,53,500.
2. Final dividend at 5% declared on paid up capital.
3. Preliminary expenses to be written off by 10%.
4. The provision for bad debts to be maintained at 2% on debtors.
5. Rs.10,000 were to be transferred to general reserve.
6. A provision for income tax Rs.12,500 was to be made.
Prepare final accounts in vertical form.
 Profit and Loss Accounts for the year ended on 31-03-2012
Particulars Note No. Rs. Rs.
I Revenue from Operation:
Sales 10,37,500
II Other Revenue -
Interest on 4% Govt. Sec. 6,200
III Total Revenue 10,43,700
IV Expenses:
(a) Purchase of Goods 4,62,500
(b) Change in Inventories
Opening Stock 1,87,500
Less: Closing Stock 1,53,500 34,000
(c) Employees Benefit Expenses
Wages 2,12,000
Directors fees 14,350
Salaries 36,250 2,62,600
(d) Depreciation and Amortization:
Preliminary Exp Written off 1,250
(e) Financial Expenses;
Interest on Debenture Paid 22,500
Add: Outstanding 16,500 39,000
(f) Other Expenses 1 77,550
8,76,900
V Profit Before Tax III - IV 1,66,800
Less Income Tax Provision 12,500
Net Profit After Tax 1,54,300
Add Opening Balance of P/L Appropriation A/c 36,250
1,90,550
Less: Appropriation:
Transfer to General Reserve 10,000
Final Dividend (1150000 – 18000)x5% 56,600
Interim Dividend paid 18,750 85,350
Balance Transfer to Balance Sheet 1,05,200

Note 1 Other Expenses

Particulars Rs. Rs.
Rent 13,000
General Expenses 12,250
Freight 32,750
Commission 18,000
Bad Debts 5200
+ Bad Debts Reserve (Adj.) 4350
9550
- Bad Debts Reserve (TB) 8000 1550
Total 77,550
 Balance sheet as at 31-3-2012
Particulars Note No. Rs. Rs.
Equity and Liabilities:
(1) Share Holders’ Fund:
(a) Equity share Capital 1150000
Less: Calls in Arrears 18000 11,32,000
(b) Reserve and Surplus
General Reserve 62500
Add: Appropriation 10000 72500
Profit and Loss App. A/c 1,05,200
Preliminary Expenses 12500
Less: Written off 1250 (11,250)
(2) Non Current Liabilities:
6% Debenture 650000
Add: Outstanding interest 16500 6,66,500
(3) Current Liabilities:
(a) Trade Payable:
Creditors 130000
Bills Payable 96000 2,26,000
(b)Short Term Provisions
Dividend Declared 56600
Provision for Tax 12500 69100
22,60,050
Assets:
(1) Non Current Assets:
(a) Fixed Assets:
(i) Tangible:
Plant and Machinery 800000
Fixtures 18000
Building 750000
(ii) Intangible
Goodwill 62600 16,30,500
(b) Non Current Investment:
4% Government Securities 1,55,000
(2) Current Assets:
(a) Inventories (Stock) 1,53,500
(b)Trade Receivable:
Debtors 217500
Less: BDR 4350 2,13,150
(C) Cash or Equivalent
Cash 5950
Bank 95750 1,01,700
Other Current Assets
(Interest on 4%Govt. Sec due) 6200
22,60,050