UNIT 4 Problems

UNIT 4: Preparation of Financial Statements from Incomplete Records
Problems
1. Raju does not maintain proper records of his business. However, he provides the
following information:
Opening capital 10,000
Closing capital 12,500
Drawings during the year 3,000
Capital added during the year 3,750
You are required to calculate the profit or loss for the year.
2. Rakesh started his business on 1st of April 2021. He invested a capital of Rs 1,00,000.
On 31st March 2022, he has the following information available as per the Single-entry
system maintained by him.
Cash balance (counted) 3,200
Inventory (physically verified) 34,800
Receivable from Ajay against credit sales 31,000
Machine 85,000
Payable to Vinod towards credit purchase 12,000
Loan taken from Bank 10,000
Drawings made during the year 24,000
You are required to calculate the profit or loss earned by Rakesh for the year ended 31st
March 2022.
3. The closing capital of Mr. B as on 31.3.2022 was `4,00,000. On 1.4.2021 his capital
was ` 3,50,000. His net profit for the year ended 31.3.2022 was ` 1,00,000. He
introduced `30,000 as additional capital in February, 2022 Find out the amount drawn
by Mr. B for his domestic expenses.
4. Given information:
Opening capital: 60,000
Drawings: 5,000
Capital introduced during the period: 10,000
Closing capital: 90,000
Profit earned during the period ?
5. A Firm sold 20% of the goods on cash basis and the balance on credit basis. Debtors
are allowed 1½ month's credit and their balance as on 31.03.2021 is ` 1,25,000. Assume
1|Pa ge
that the sale is uniform throughout the year. Calculate the credit sales and total sales
of the company for the year ended 31.03.2022.
6. Assets and Liabilities of Mr. X as on 31-03-2021 and 31-03-2022 are as follows:
31-03-2021 31-03-2022
Assets
Building 1,00,000 ?
Furniture 50,000 ?
Inventory 1,20,000 2,70,000
Sundry debtors 40,000 90,000
Cash at bank 70,000 85,000
Cash in hand 1,200 3,200
Liabilities
Loans 1,00,000 80,000
Sundry creditors 40,000 70,000
Decided to depreciate building by 2.5%p.a. and furniture by 10% p.a. One Life Insurance
Policy of the Proprietor was matured during the period and the amount ` 40,000 is retained
in the business. Proprietor took @ ` 2,000 p.m. for meeting family expenses. Prepare
Statement of Affairs as on 31-03-2021 and 31-03-2022. Find out profit of Mr. X for the year
ended 31-03-2022.
7. Bribal maintains his books according to the single-entry system. His assets &liabilities
were as follows:
31.12.2018 31.12.2019
Plant & Machinery 1, 50,000 1, 60,000
Debtors 65,000 60,000
Cash & Bank Balances 25,000 31,000
Stock 40,000 45,000
Creditors 9,000 10,000
a) He had withdrawn Rs. 200 every month for personal use.

b) Depreciation on Plant & Machinery @10% p.a.
c) Further Bad Debts Rs. 5,000 & Provision for bad debts to be created
on debtors@2%.
d) During the period wage outstanding was Rs.1, 000.
2|Pa ge
Prepare a statement of Profit & Loss for the year ended 31st December 2019.
8. Ram carried on business as retail merchant. He has not maintained regular account
books. However, he always maintained ` 10,000 in cash and deposited the balance
into the bank account. He informs you that he has sold goods at profit of 25% on sales.
Following information is given to you:
Assets and Liabilities As on 1.4.2021 As on 31.3.2022
Cash in Hand 10,000 10,000
Sundry Creditors 40,000 90,000
Cash at Bank 50,000 (Cr.) 80,000 (Dr.)
Sundry Debtors 1,00,000 3,50,000
Stock in Trade 2,80,000 ?
Ram’s capital 3,00,000 ?
Analysis of his bank pass book reveals the following information:
Payment to creditors ` 7,00,000
Payment for business expenses ` 1,20,000
Receipts from debtors ` 7,50,000
Loan ` 1,00,000 taken on 1.10.2021 at 10% per annum
Cash deposited in the bank ` 1,00,000
He informs you that he paid creditors for goods ` 20,000 in cash and salaries ` 40,000 in
cash. He has drawn ` 80,000 in cash for personal expenses. During the year Ram had not
introduced any additional capital. Surplus cash if any, to be taken as cash sales. All
purchases are on credit basis.
You are required to prepare Trading and Profit and Loss Account for the year ended
31.3.2022 and Balance Sheet as at 31st March, 2022.
9. Naresh, Ramesh & Dinesh are partners in a firm sharing Profits & Losses in the ratio
of 5:3:2 respectively. They keep their books on single entry system. On 31st March
2018, the following statement of Affairs are extracted from their Books:
Liabilities Amount Assets Amount

Creditors 20,000 Plant 45,000
Land & Building 30,000
Ramesh – Loan A/c 10,000 Stock 20,000
Debtors 15,000
3|Pa ge
Capital Cash 8,000
Naresh---- 50,000 Capital - Dinesh 2,000
Ramesh---- 40,000
1,20,000 1,20,000
On 31st March 2019, the Assets & Liabilities were as follows:

Plant Rs. 50,000; Land & Building Rs. 30,000; Stock Rs. 30,000; Debtors Rs.25,000;
Creditors Rs.25,000; Cash Rs. 15,000.
You are required to prepare a Profit & Loss statement for the year ended31st March 2019 & a
statement of Affairs as at that date after taking into consideration the following additional
information:
i) Plant is to be depreciated by 10% p.a.
ii) A Reserve for Bad Debts is to be raised at 2.5%;
iii) Interest on Partners’ Capital is to be allowed at 5% p.a.
iv) During 2018-19, Naresh & Ramesh withdrew from Business Rs.7,500 &
Rs. 5,000 respectively.
10. Nanimadhav started a grocery business on 1st January 2019with a capital of Rs.
10,000. He spent Rs. 1,500 on Furniture andFixture in Cash. He maintains his books
on single entry. Following figures are extracted from his books:
Rs.
Sales (inclusive of Cash Sales Rs. 8,000) 20,000
Purchase (inclusive of Cash Purchase Rs. 2,500) 12,000
Bad Debt Written Off 750
Business Expenses 1,050

Nanimadhav used groceries worth Rs. 1,500 and took 13,000 in Cash for personal use. On 31st
December, 2019 his Sundry Debtorswere Rs. 1,250 and Sundry Creditors Rs. 1,500. Stock in
hand on 31st December, 2019 was Rs. 1,500.
Prepare a Trading and Profit and Loss Account for the year ended31st December, 2019 and a
Balance Sheet as on the date after writing 10% depreciation on furniture and fixture.
4|Pa ge

UNIT 4 Problems

Uploaded by

Copyright:

Available Formats

UNIT 4 Problems

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

UNIT 4 Problems

Uploaded by

Copyright:

Available Formats

UNIT 4: Preparation of Financial Statements from Incomplete Records

Debtors 65,000 60,000

Cash & Bank Balances 25,000 31,000

Stock 40,000 45,000

Creditors 9,000 10,000

a) He had withdrawn Rs. 200 every month for personal use.

Liabilities Amount Assets Amount

On 31st March 2019, the Assets & Liabilities were as follows:

Business Expenses 1,050

You might also like

Pfad - The Proxy pFad of © 2024 Garber Painting. All rights reserved.