SAMPLE QUESTION PAPER - 5

Accountancy (055)
Class XI (2024-25)

Time Allowed: 3 hours Maximum Marks: 80

General Instructions:
1. This question paper contains 34 questions. All questions are compulsory.
2. This question paper is divided into two parts, Part A and B.
3. Question 1 to 17 and 27 to 29 carries 1 mark each.
4. Questions 18 to 20 and 30 to 32 carries 3 marks each.
5. Questions from 21 to 23 carries 4 marks each.
6. Questions from 24 to 26, 33 and 34 carries 6 marks each.
Part A
1. Pick out a source voucher/document from the following: [1]

a) Transfer Voucher b) Debit Voucher

c) Invoice d) Credit Voucher

2. Assertion (A): Accounting records only the transactions of financial nature. [1]
Reason (R): Goods taken from the business by the proprietor for his personal use is
not of financial nature and hence will not be recorded.

a) Both A and R are true and R is b) Both A and R are true but R is
the correct explanation of A. not the correct explanation of
A.

c) A is true but R is false. d) A is false but R is true.

3. Rule of Debit and Credit for Impersonal account is [1]

a) Dr. the receiver and Cr. the b) Dr. all expenses and Cr. all
giver gains & Dr. what goes out and
Cr. what comes in

c) Dr. all expenses and Cr. all d) Dr. what goes out and Cr. what
gains comes in
4. If the Owner's Equity is 20,000 and Creditors Equity is 40,000. What will be the [1]
assets of the firm?

a) 80000 b) 60000

c) 40000 d) 20000

OR
Items owned by a business that have monetary value are ____

a) Assets b) Capital

c) Debentures d) Liabilities

5. Credit Note is prepared: [1]

a) when the debit is given to the b) when both credit and debit is
account given to the account

c) when transfer in the account d) when credit is given to the

account

6. ________ function is routine and clerical in nature and is increasingly done by [1]
computers now-a-days.

a) Financing b) Accounting

c) Accounting and bookkeeping d) Bookkeeping

OR
Bills ________ is an accounting term for bills of exchange drawn on ________
received by way of endorsement from them.

a) payable, creditors b) receivable, creditors

c) receivable, debtors d) payable, debtors

7. Secret Reserve is shown in: [1]

a) Balance Sheet on the liabilities b) None of these

side
 c) Balance Sheet on the assets d) Profit and Loss Account
side

8. The data is classified for creating groups of accounts in the heads of: [1]

a) Assets, Liabilities and Capital b) Assets, Owners’ equity,

Revenue and Expenses

c) Assets, Capital, Liabilities, d) Capital, Revenue and Expenses

Revenue and Expenses

OR
Which account will be debited if proprietor pays ₹ 5,000 as life insurance premium
from business cash?

a) Bank A/c b) Drawings A/c

c) Cash A/c d) Insurance A/c

9. In Accounting, bases of ascertaining profit or loss is: [1]

a) Cash Basis b) Only cash basis

c) Either Cash or Accrual Basis d) Accrual Basis

10. According to which concept the same accounting methods should be used each [1]
year:

a) Full Disclosure b) Prudence

c) Consistency d) Materiality

11. Creation of reserves: [1]

a) Increases the profits b) Decreases the divisible profits

c) Decreases the profits d) Increases the divisible profits

12. Tangible Assets do not include: [1]

a) Furniture b) Goodwill

c) Cash d) Stock
13. Total of Sales Return Column in the Sales Return Book is posted to: [1]

a) Sales Return A/c - Cr. b) Sales Return A/c - Dr.

c) Sales A/c - Dr. d) Sales A/c - Cr.

14. Calculate total expenses if capital Rs.2,00,000, creditors Rs. 50,000, revenue [1]
Rs.5,00,000 and asset Rs. 5,00,000.

a) Rs.5,50,000 b) Rs.7,00,000

c) Rs.2,50,000 d) Rs.3,50,000

15. Current Liabilities include: [1]

Debentures, Bills Payable, Long-term Loans, Capital

a) Bills Payable b) Debentures

c) Capital d) Long-term Loans

OR
The person, firm or institution who does not pay the price in cash for the goods
purchased or the services received is called:

a) Proprietor b) Debtor

c) Creditor d) Solvent

16. Which of the following is/are not recorded in purchase book? [1]
i. Cash purchase of goods worth ₹5,000.
ii. Purchase of furniture on credit worth ₹75,000.
iii. Purchase of stationery of ₹3,000 on credit.

a) i, ii and iii b) ii and iii

c) i and iii d) only i

17. Good debts are [1]

a) who have good characters b) those whose collection of credit

is uncertain
 c) those whose collection of credit d) who has paid the whole amount
is certain

18. Give any three points distinguishing between a journal and a ledger? [3]

OR
What is Trade Discount? Give an example.

19. International Financial Reporting Standards (IFRS) provides a number of benefits. [3]
Explain any three.

OR
Mr. Abhinav Kumar, a homeopath doctor in practice has been advised by his
Accountant to maintain his accounts on Accrual Basis instead of the presently followed
Cash Basis of Accounting. Do you agree with the advice of the Accountant? Give
reasons.

20. Classify the following into (i) Assets (ii) Liabilities (iii) Expenses and (iv) [3]
Revenues
Sales, Bank balance, Debtors, Bank Overdraft, Creditors, Salary to the manager,
Discount to debtors, Cost of goods sold

21. Prepare the trial balance of Mahesh as on 31st March, 2023. He has omitted to open [4]
a Capital Account:
₹ ₹
Bank Overdraft 95,000 Purchases 4,45,000
Sales 8,10,000 Cash in Hand 8,500
Purchases Return 22,500 Creditors 2,15,000
Debtors 4,00,500 Sales Return 15,750
Wages 96,000 Equipment 25,000
Capital ? Opening Stock 3,00,500

22. Explain the need for drawing up the special purpose books. [4]

23. i. On 31st March, 2023, the Bank Pass Book of Renu Enterprises showed a credit [4]
balance of ₹ 15,000.
ii. Before that date, she had issued cheques amounting to ₹ 8,000 out of which
cheques of ₹ 3,200 were presented for payment till 31st March, 2023.
 iii. A cheque of ₹ 2,200 deposited by her into the bank on 28th March, 2023 is not
yet credited in the Bank Pass Book.
iv. She had also received a cheque of ₹ 500 which although entered by her in the
bank column of Cash Book, was omitted to be paid into the bank.
v. On 30th March, 2023, a cheque of₹ 1,570 received by her was paid into the bank
but the same was omitted to be recorded in the Cash Book.
vi. There was a credit of ₹ 150 for interest on current account and a debit of ₹ 25 for
bank charges.
vii. A wrong credit of ₹ 2,000 was given by bank on 27th March, 2023 and was
reversed on 10th April, 2023.
Prepare Bank Reconciliation Statement as on 31st March, 2023.

OR
On 31st March 2018, the Cash Book of B.Babu showed an overdraft of Rs.18,000 with
the Bank of India. This balance did not agree with the balances as shown by the Bank
Pass Book. You find that Babu had paid into the Bank on 26th March, four cheques for
Rs.10,000, Rs.12,000 Rs.6,000 and Rs.8,000. Of these, the cheques for Rs.6,000 was
credited by the Bank in April 2018. Babu had issued on 24th March, three cheques for
Rs.15,000, Rs.12,000 and Rs.7,000. The first two cheques were presented to the Bank
for payment in March 2018 and third cheque in April 2018.
You also find that on 31st March 2018 the Bank had debited Babu's account with
Rs.500 for interest, Rs.20 as charges, but Babu had not recorded these amounts in his
Books.
Prepare Bank Reconciliation Statement as on 31st March 2018 and ascertain the
balance as per the Bank Pass Book.

24. Pass Journal Entries for the following: [6]

2023 March 2 Purchased an Iron Safe for business for ₹ 1,00,000 and payment
made by cheque.
2023 March 3 Purchased filing cabinet for office use ₹ 40,000 and paid ₹ 200 as
cartage on it.
2023 March 4 Purchased a Computer from Shyam & Co. for ₹ 80,000 on credit.
2023 March 5 Purchased an electric fan for ₹ 20,000.
2023 March 6 Purchased a Horse for business for ₹ 1,50,000 and payment made by
cheque.
2023 March 7 Purchased Post Cards for ₹ 250; Envelopes for ₹ 500 and Stamps for
₹ 1,000.
 2023 March 8 Purchased office stationery for ₹ 4,000.
2023 March 15 Gave as Charity - Cash ₹ 2,000 and Goods ₹ 4,000.
2023 March 20 The horse bought on March 6 died, its carcass was sold for ₹
10,000.
2023 March 25 Sold household furniture for ₹ 1,00,000 and paid the money into the
business.
2023 March 31 Paid to the landlord by cheque ₹ 1,20,000 for rent. One-third of the
building is occupied by the proprietor for residential use.

OR
Pass Journal entries for the following transactions:
i. Pawan started business with cash ₹ 2,00,000 and Bank ₹ 8,00,000.
ii. Bought a machinery for ₹ 25,00,000 by making a down-payment of 10%.
iii. Paid ₹ 48,000 as wages for installation of machine.
iv. Bought goods from Kumar Bros. ₹ 3,00,000.
v. Withdrawn from bank ₹ 50,000.
vi. Repaid bank loan ₹ 35,000 including interest of ₹ 3,000.
vii. Sold goods to Suresh ₹ 40,000.
viii. Received from Suresh ₹ 39,750, discount allowed ₹ 250.
ix. Paid rent of ₹ 37,500 by cheque.
x. Provide depreciation on machinery at 15% per annum.

25. While trying to close his books for the year ended 31st March, 2023, Mandeep [6]
found that the trial balance did not agree. He traced the following errors:
i. The Purchases Book was undercast by ₹ 500.
ii. The Sales Book was overcast by ₹ 100.
iii. ₹ 620 received from Manoj were posted to the debit of his A/c.
iv. The total of the credit of Bhanu’s A/c has been over added by ₹ 800.
v. A discount of ₹ 282 allowed to a customer has been credited to his account as ₹
228.
vi. Goods for ₹ 1,200 returned to Kartik Sharma, though entered in the Return Book
has not been posted to his account.
Rectify the above errors, assuming:
A. that no suspense account has been opened with the difference in the trial balance,
 B. that such a suspense account has been opened.

OR
Rectify the following errors which are detected before preparation of the Trial Balance:
i. Sale to Prakash ₹ 50,000 posted to his account as ₹ 5,000.
ii. Sale to Prakash ₹ 30,000 debited to his account as ₹ 3,000.
iii. Sale to Prakash ₹ 20,000 credited to his account as ₹ 2,000.
iv. Sale to Ravi ₹ 5,600 posted to his account as ₹ 6,500.
v. Purchases of ₹ 8,755 from Nitin posted to his account as ₹ 5,578.
vi. Purchases of ₹ 6,580 from Nitin posted to his account as ₹ 8,560.
vii. Cash sale to Abhi of ₹ 30,000 posted as ₹ 3,000.
viii. Debit balance of ₹ 5,000 was carried forward as a credit balance in Ritesh’s Account.
ix. Credit purchase of furniture ₹ 30,000 from Rohit was posted as ₹ 3,000.

26. Berlia Ltd. Purchased a second-hand machine for ₹ 56,000 on July 01, 2015, and [6]
spent ₹ 24,000 on its repair and installation and ₹ 5,000 for its carriage. On
September 01, 2016, it purchased another machine for ₹ 2,50,000 and spent ₹
10,000 on its installation.
i. Depreciation is provided on machinery @ 10% p.a on original cost method
annually on December 31. Prepare machinery account and depreciation account
from the year 2015 to 2018.
ii. Prepare machinery account and depreciation account from the year 2011 to 2018,
if depreciation is provided on machinery @10% p.a. on written down value
method annually on December 31.

OR
On April 01, 2010, Bajrang Marbles purchased a Machine for ₹ 1,80,000 and spent ₹
10,000 on its carriage and ₹ 10,000 on its installation. It is estimated that its working
life is 10 years and after 10 years its scrap value will be ₹ 20,000.
i. Prepare Machine account and Depreciation account for the first four years by
providing depreciation on the straight-line method. Accounts are closed on March
31st every year.
ii. Prepare Machine account, Depreciation account, and Provision for depreciation
account (or accumulated depreciation account) for the first four years by providing
depreciation using straight-line method accounts are closed on March 31 every year.
 Part B
27. Two methods for ascertaining profit and loss in case of single entry system: [1]

a) Statement of balance and b) Statement of affairs and

conversion converter

c) Statement of affairs and d) Statement of profits and

conversion Conversation

OR
Single entry system records

a) Two sided effect b) One sided effect

c) Three sided effect d) Four sided effect

28. Payment of Income Tax is considered as: [1]

a) Administrative expense b) Direct Expenses

c) Operating Expenses d) Indirect Expenses

29. Wages paid for the installation of the machine is added to the cost of machine [1]
because of

a) Cost Principle b) Accrual Concept

c) Materiality Principle d) Matching Principle

OR
Following particulars are given in Trial Balance:
Purchases ₹ 1,10,000; Sales ₹ 2,00,000; Wages ₹ 30,000; Closing Stock was ₹ 8,000
more than the Opening Stock. Two-third of the Wages was charged to the Cost of goods
sold in Trading Account. Gross Profit was:

a) ₹ 78,000 b) ₹ 88,000

c) ₹ 62,000 d) ₹ 68,000

30. From the following information, prepare trading account for the year ended 31st [3]
March, 2013
Amt (Rs.)
 Cost of goods sold 45,00,000
Sales 72,00,000
Closing Stock 2,40,000

31. Ascertain Gross Profit from the following information : [3]

(₹)
Opening Stock 3,00,000
Closing Stock 2,80,000
Purchases 8,50,000
Carriage on Purchases 23,000
Carriage on Sales 30,000
Office Rent 58,000
Sales 14,07,000

32. Illustrate with example the principle for valuation of stock or inventory. [3]

33. Siya maintains her books of account from Incomplete Records. Her books provide [6]
the following information:
st st
1 April 31 March
Particulars
2022 (₹) 2023 (₹)
Cash 1,200 4,000
Debtors 16,800 27,200
Stock 22,400 24,400
Investments ____ 8,000
Furniture 7,500 8,000
Creditors 14,900 11,600
She withdraws ₹ 500 per month for personal expenses. She sold her Investments ₹
16,000 at 5% premium and introduced the amount into a business.
st
You are required to prepare a Statement of Profit or Loss for the year ending 31
March 2023.

OR
Govind keeps incomplete records. On 1st April, 2022, his position was as follows:
 STATEMENT OF AFFAIRS
Liabilities Amount (₹) Assets Amount (₹)
Bank Overdraft 7,500 Cash 6,400
Sundry Creditors 15,000 Stock 52,000
Capital 1,64,500 Sundry Debtors 28,000
Fixed Assets 1,00,000
Prepaid Expenses 600
1,87,000 1,87,000
His position on 31st March, 2023 was as follows :
Cash in hand ₹ 3,000; Cash at Bank ₹ 5,000; Stock ₹ 44,000; Debtors ₹ 21,000; Fixed
Assets ₹ 80,000; Creditors ₹ 22,000.
You are informed that Govind has taken stocks worth ₹ 4,500 for his private use and
that he has been regularly transferring ₹ 2,000 per month from his business banking
account by way of drawings. Out of his drawings, he spent ₹ 15,000 for purchasing a
Scooter for the business on 1st October, 2022.
You are requested to find out his profit or loss and to prepare the Statement of Affairs
after considering the following:
i. Depreciate Fixed Assets and Scooter by 10% p.a.
ii. Write off Bad-Debts ₹ 1,000 and provide 5% for doubtful debts on Sundry Debtors.
iii. Commission earned but not received by him was ₹ 2,500.

34. Give Journal Entries for the following adjustments in final accounts: [6]
i. Extract of Trial Balance as on 31st March, 2023
Particulars Debit (₹) Credit (₹)
Sundry debtors 6,60,000
Bad debts 15,000
Provision for doubtful debts 40,000
Additional Information:
a. Additional Bad Debts ₹ 20,000.
b. Maintain the provision for doubtful debts @ 5% on debtors.
ii. Goods costing ₹ 20,000 were distributed among staff members as free of cost.
These goods were purchased paying IGST @ 12%.
iii. Two month’s rent @ 15,000 per month is outstanding. Rent is subject to levy of
12% IGST.
iv. Included in general expenses is annual Insurance Premium of ₹ 10,000 paid for
the year ending 30th June, 2023. IGST is levied @ 12%.
v. Accrued commission ₹ 5,000. IGST is levied @ 12%.

OR
From the following trial balance of M/s Amit & Sons as at 31st, March, 2023 prepare
trading and profit and loss account for the year ended 31st March, 2023 And Balance
Sheet as at that date:
Debit Credit
Name of Accounts L.F.
Balance (₹) Balance (₹)
Capital ____ 80,000
Drawings 18,000 ____
Sales ____ 1,55,000
Purchases 82,600 ____
Stock (1st April, 2022) 42,000 ____
Returns Outward ____ 1,600
Carriage inward 1,200 ____
Wages 4,000 ____
Power 6,000 ____
Machinery 50,000 ____
Furniture 14,000 ____
Rent 22,000 ____
Salary 15,000 ____
Insurance 3,600 ____
8% Bank Loan ____ 25,000
Debtors 20,600 ____
Creditors ____ 18,900
Cash in hand 1,500 ____
Total 2,80,500 2,80,500
 Adjustments:
i. Closing Stock ₹ 64,000.
ii. Wages outstanding ₹ 2,400.
iii. Bad debts ₹ 600.
iv. Provision for Doubtful debts to be 5%.
v. Rent is paid for 11 months.
vi. Loan from the bank was taken on 1st Oct. 2022.
vii. Provide depreciation on machinery @ 10% p.a.
viii. Provide Manager’s commission at 10% on net profit after charging such
commission.
 Solution
SAMPLE QUESTION PAPER - 5
Accountancy (055)
Class XI (2024-25)
Part A
1.
(c) Invoice
Explanation:
Invoice
2.
(c) A is true but R is false.
Explanation:
A is true but R is false.
Goods taken by proprietor for his personal use are also recorded as drawing in the books
of account. they are of financial in nature, amount is spent by the organisation on the
purchase of that goods in the business.
3.
(c) Dr. all expenses and Cr. all gains
Explanation:
Dr. all expenses and Cr. all gains
4.
(b) 60000
Explanation:
Total Assets= Onwers equity + Creditors Equity
Total assets= 20000+40000
Total assets= 60000
OR
(a) Assets
Explanation:
Assets are the property owned by business having monetary value. Assets can be in
tangible assets or intangible assets.
Example:- Cash, Bank, Stock, Debtors, Goodwill Etc.
5.
(d) when credit is given to the account
Explanation:
A credit note or credit memo is a commercial document issued by a seller to a buyer.
Credit notes act as a source document for the sales return journal.
 6.
(d) Bookkeeping
Explanation:
Bookkeeping
OR

(c) receivable, debtors

Explanation:
receivable, debtors
7.
(b) None of these
Explanation:
None of these
8.
(c) Assets, Capital, Liabilities, Revenue and Expenses
Explanation:
Assets, Capital, Liabilities, Revenue and Expenses
OR

(b) Drawings A/c

Explanation:
Drawings A/c
9.
(c) Either Cash or Accrual Basis
Explanation:
Either Cash or Accrual Basis
10.
(c) Consistency
Explanation:
According to Consistency Concept, the same accounting methods should be used each and
every year.
11.
(b) Decreases the divisible profits
Explanation:
Decreases the divisible profits
12.
(b) Goodwill
 Explanation:
Goodwill is considered as an intangible (or non-current) asset because it is not a physical
asset like buildings or equipment. Hence it is not tangible assets.
13.
(b) Sales Return A/c - Dr.
Explanation:
When a customer returns goods it has bought from a business a credit note is issued by the
business and details are recorded in the sales return daybook.
14.
(c) Rs.2,50,000
Explanation:
As per Accounting Equation:-
Assets = Capital + Liabilities
5,00,000 = Capital + 50,000
Therefore capital should be = 5,00,000 - 50,000 = Rs 4,50,000
Closing capital = opening capital + revenue - expenses
4,50,000 = 2,00,000 + 5,00,000 - Expenses
Expenses = 7,00,000 - 4,50,000 = Rs 2,50,000
15. (a) Bills Payable
Explanation:
Bills Payable
OR

(b) Debtor
Explanation:
The person, firm or institution who does not pay the price in cash for the goods purchased
or the services received is called debtor.
16. (a) i, ii and iii
Explanation:
Purchase book records only credit purchase of goods. All credit purchases of goods are
recorded in the purchases journal whereas cash purchases are recorded in the cash book.
Other purchases such as purchases of office equipment, furniture, building, are recorded in
the journal proper if purchased on credit, or in the cash book if purchased for cash.
17.
(c) those whose collection of credit is certain
 Explanation:
The debtors are sold goods on credit. If the money is sure to be collected from the debtors
in other words if the collection of the debt is certain then those debts are known as good
debts.
18. The journal and the ledger are the most important books of the double entry mechanism of
accounting and are indispensable for an accounting system. The following points of
comparison are worth noting
Basis Journal Ledger
The journal is the book of The ledger is a book of
Nature of Book
first entry (original entry). secondary or final entry.
Chronological/Analytical The journal is the book for The ledger is the book for
Record chronological record. analytical record.
Process of recording in the The process of recording in
Process of Recording journal is called the ledger is known as
journalising. posting.
Transaction is the basis of Account is the basis of
Basis of classification classification of data within classification of data within
the journal. the ledger.
A journal has five columns- Ledger has four identical
Date, particulars, ledger columns on debit and credit
Format
folio, debit amount, credit side-Date, particulars, journal
amount. folio, amount.
OR
When discount ia allowed by seller to its customers at a fixed percentage on the list price
of the goods it is called trade discount. It is not recorded in the books of accounts as it is
deducted in the invoice itself from the gross value of goods.
Example: If a trader sells goods of the list price of ₹ 15000 at 20% trade discount to Ram.
The following entry will be made:
Journal Entry
Date Particulars L.F. Dr. (₹) Cr. (₹)
Ram Dr. 12000
To Sales A/c 12000
(goods sold to Ram less trade discount @ 20%)
19. i. Comparability: It is the level of standardization of accounting information that allows
the financial statements of multiple organizations to be compared to each other. This is
a fundamental requirement of financial reporting that is needed by the users of financial
statements.
Financial statements are more comparable when the same accounting policies and
standards are applied across multiple reporting periods, as well as across multiple
entities within an industry. For example, if a number of oil and gas firms consistently
apply the same industry-specific accounting standards to their financial statements, then
there should be a high level of comparability within that industry.
ii. Flexibility: using a philosophy that is based on the principles, instead of the rules, this
set of standards will have the goal of arriving at a reasonable valuation with various
ways to accomplish a task. Financial statements are more easy to reads and to use.
iii. Beneficial to small and new investors: IFRS can help new and small investors by
making, reporting standards to have better quality and become simpler, putting these
investors in a similar position with professional investors, which was not feasible with
previous standards.
OR
No, I do not agree. Cash Basis of Accounting is more appropriate for Mr. Abhinav Kumar
because a medical practitioner receives his fee immediately after giving consultancy.
20. Classification is as follows:-
i. Assets: Bank balance, Debtors
ii. Liabilities: Bank overdraft, creditors
iii. Expenses: Salary to Manager, Discount to debtors, cost of goods sold
iv. Revenues: Sales
21. Trial Balance as on 31st March
Head of Account Dr. (₹) Cr. (₹)
Bank Overdraft A/c 95,000
Sales A/c 8,10,000
Purchase Return A/c 22,500
Debtors A/c 4,00,500
Wages A/c 96,000
Purchases A/c 4,45,000
Cash in Hand A/c 8,500
Creditors A/c 2,15,000
 Head of Account Dr. (₹) Cr. (₹)
Sales Return A/c 15,750
Equipment A/c 25,000
Opening Stock A/c 3,00,500
Capital A/c (Balancing figure) 1,48,750
12,91,250 12,91,250
22. Special purpose books are beneficial in:
i. Accuracy: As each journal is managed by a different accountant having specific
expertise, it improves accuracy and reduces defects.
ii. Efficiency: Increases efficiency by dividing the workload.
iii. Concise Descriptions: The journal describes the purpose of recording. For example, a
record in the purchase journal will be understood by default that it is a purchase-related
transaction.
iv. Minimal Posting: Reduces the volume of posting as totals can be done periodically.
v. Fraud Prevention: As the recording of different journals are assigned to a different
individual, fraud prevention is prevented.
vi. Faster process: As multiple books are handled by multiple accountants, the recording
work moves faster.
23. BANK RECONCILIATION STATEMENT
as on 31st March, 2023
Amount Amount
Particulars
Details (₹) (₹)
Balance as per Bank Pass Book (Cr.) 15,000
Add: Cheque deposited but not yet cleared 2,200
Cheque recorded in Cash Book but not deposited 500
Bank charges debited by Bank 25 2,725
17,725
Less: Cheques issued but not yet presented for Payment 4,800
Cheque deposited into Bank but not recorded in Cash Book 1,570
Interest credited by Bank 150
Wrong credit by Bank (Note) 2,000 8,520
Balance as per Cash Book (Dr.) 9,205
 Note: Bank has wrongly credited the Pass Book by ₹ 2,000. It means, Pass Book Balance
is higher by ₹ 2,000. To arrive at the Cash Book balance, ₹ 2,000 will be deducted.
OR
BANK RECONCILIATION STATEMENT
as on March 31, 2018
Particulars (+) (-)
Unfavourable balance as per
18,000
Cash Book (Cr.)
Cheque not yet collected 6,000
Cheques not yet presented 7,000
Interest on Overdraft 500
Bank charges 20
Unfavourable balance as per
Pass Book (Dr.) (Balancing 17,520
figure)
24,520 24,520
24. JOURNAL
Amount Amount
Date Particulars L.F.
Dr. Cr.
2023
March
Office Equipment A/c Dr. 1,00,000
2
To Bank A/c
1,00,000
(Iron-safe purchased)

March
Office Equipment A/c (40,000+200) Dr. 40,200
3
To Cash A/c
(Filing cabinet purchased for ₹ 40,000 and cartage 40,200
paid on it ₹ 200 should be capitalised)

March
Office Equipment A/c Dr. 80,000
4
 Amount Amount
Date Particulars L.F.
Dr. Cr.
2023
To Shyam & Co.
80,000
(Computer purchased on credit)

March
Fixtures A/c Dr. 20,000
5
To Cash A/c
20,000
(Electric fan purchase for cash)

March
Live Stock A/c Dr. 1,50,000
6
To Bank A/c
1,50,000
(horse purchase for business)

March
Postage A/c (250+500+1,000) Dr. 1,750
7
To Cash A/c
1,750
(Post Cards, envelopes and stamps purchased)

March
Stationery A/c Dr. 4,000
8
To Cash A/c
4,000
(Stationery purchased for office use)

March
Charity A/c (2,000+4,000) Dr. 6,000
15
To Cash A/c 2,000
To Purchases A/c
4,000
(Cash and goods are given as Charity)

March
Cash A/c Dr. 10,000
20
Profit & Loss A/c (1,50,000-10,000) Dr. 1,40,000
To Live Stock A/c 1,50,000
(Cash received for the sale of the carcass of dead
 Amount Amount
Date Particulars L.F.
Dr. Cr.
2023
horse)

March
Cash A/c Dr. 1,00,000
25
To Capital A/c
(Sale proceeds of house furniture paid into the 1,00,000
business)

March
Rent A/c (2/3rd of ₹ 1,20,000) Dr. 80,000
31
Drawings A/c (1/3 × 1,20,000) Dr. 40,000
To Bank A/c
(Rent paid to the landlord, 1/3rd of the building is 1,20,000
occupied by the proprietor for residential use)
Total ₹ 7,71,950 7,71,950
OR
Journal
S.
Particulars L.F. Dr. (₹) Cr. (₹)
No.
(i) Cash A/c Dr. 2,00,000
Bank A/c Dr. 8,00,000
To Capital A/c
(Business started by Pawan with 2,00,000 cash & 10,00,000
8,00,000 cheque)

(ii) Machinery A/c Dr. 25,00,000

To Bank A/c 2,50,000
To Vendor A/c
(Machinery Purchased by making 10% Down 22,50,000
Payment)

(iii) Machinery A/c Dr. 48,000

 To Cash A/c
48,000
(Paid wages for installation of machinery)

(iv) Purchase A/c Dr. 3,00,000

To Kumar Bros.
3,00,000
(Bought goods from Kumar Bros. on credit)

(v) Cash A/c Dr. 50,000

To Bank A/c
50,000
(Cash withdrawn from Bank)

(vi) Bank Loan A/c Dr. 32,000

Interest on Bank Loan A/c Dr. 3,000
To Bank A/c
35,000
(Paid Bank loan with interest)

(vii) Suresh Dr. 40,000

To Sales A/c
40,000
(Goods sold to Suresh on Credit)

(viii) Cash A/c Dr. 39,750

Discount Allowed A/c Dr. 250
To Suresh
40,000
(received cash from Suresh Discount allowed)

(ix) Rent A/c Dr. 37,500

To Bank A/c
37,500
(Paid rent by cheque)

(x) Depreciation A/c (25,00,000 × 15%) Dr. 3,75,000

To Machinery A/c
3,75,000
(Depreciation @ 15% on Machinery charged)
25. A. When no suspense account has been opened:
If the accountant finds time before preparing trial balance to recheck the entries made in
the journal, postings in the ledger accounts, amounts carried forward and balancing of
ledger accounts with the intention of ensuring their correctness, he/she will be able to
locate and rectify the errors at that stage itself by posting in respective accounts.
i. Purchases A/c will be debited as “To undercasting of Purchases Book ... ₹ 500”.
 ii. Sales A/c will be debited as “To overcasting of Sales Book ... ₹ 100”.
iii. Manoj’s A/c will be credited as “By error in the posting to the wrong side ... ₹
1,240".
iv. Bhanu’s A/c will be debited as “To excess amount on the credit side of Bhanu’s A/c...
₹ 800”.
v. Customer’s A/c will be credited as "By Lesser amount posted to the Credit side ... ₹
54”.
vi. Kartik Sharma’s A/c will be debited as “To Omission of posting on Dr. Side ...........₹
1,200”.
B. When suspense account has been opened:
Dr. Cr.
Date Particulars L.F.
(₹) (₹)
2023
March
Purchases A/c Dr. 500
31
(i) To Suspense A/c 500
(Undercasting of purchases book now rectified)

(ii) Sales A/c Dr. 100

To Suspense A/c 100
(Overcasting of Sales Book now rectified)

(iii) Suspense A/c Dr. 1,240

To Manoj A/c 1,240
(Cash received from Manoj wrongly debited to his
account instead of being credited now rectified)

(iv) Bhanu A/c Dr. 800

To Suspense A/c 800
(Overcasting of the credit side of Bhanu’s A/c now
corrected)

(v) Suspense A/c Dr. 54

To Customer A/c 54
(The lesser amount credited to Customer’s A/c now
rectified)
 (vi) Kartik Sharma A/c Dr. 1,200
To Suspense A/c 1,200
(The amount of purchases returns now posted to Kartik
Sharma’s A/c now rectified)
OR
i. Prakash's A/c is debited by ₹ 5,000 against ₹ 50,000, hence a further debit of ₹ 45,000 is
required. It will be rectified by giving a note on the debit side of Prakash's A/c as under:
"To short debit for sales (error rectified)... ₹ 45,000".
Note: In this case since posted word is used, it will stand for the correct side. In this
case, it stands for the debit side.
ii. Prakash's A/c is short debited by ₹ 27,000. This error will be rectified by giving a note
on the debit side of Prakash's A/c:
"To short debit for sales (error rectified) ... ₹ 27,000".
iii. It is a sales transaction and Prakash’s A/c should be debited. But instead of a debit, a
credit of ₹ 2,000 has been given. Therefore,
a. Wrong credit has to be cancelled. For this, debit his account by ₹ 2,000.
b. Debit has to be given of ₹ 20,000.
Hence, Prakash’s A/c has to be debited by ₹ 22,000 (i.e., ₹ 2,000 + ₹ 20,000) by
giving the following note:
“To error rectified for credit sales ... ₹ 22,000”.
iv. Excess debit is made in Ravi’s A/c by ₹ 900. ₹ 900 (i.e., ₹ 6,500 - ₹ 5,600) will be
written on the credit side by giving a note:
“By excess debit on account of sales (now rectified) ... ₹ 900”.
v. Less credit by ₹ 3,177 (i.e.,₹ 8,755 - ₹ 5,578) is given to Nitin’s A/c on account of
credit purchases from him. ₹ 3,177 will be written on the credit side of Nitin’s A/c:
“By less credit for purchases (now rectified) ... ₹ 3,177”.
vi. ₹ 8,560 is credited to Nitin’s A/c instead of ₹ 6,580, i.e., excess credit by ₹ 1,980 (i.e., ₹
8,560 - ₹ 6,580) is granted. Rectification will be made by following note on the debit
side of Nitin’s A/c:
“To excess credit for purchases (now rectified) ... ₹ 1,980”.
vii. Cash sale is recorded in the Cash Book with the amount. However, posting is short by ₹
27,000. Since the sale is against cash, ‘Sales A/c’ will be credited.
viii. Ritesh’s A/c has been affected by ₹ 10,000 (₹ 5,000 a debit balance not recorded and ₹
5,000 wrongly credited). Therefore, his account will be debited by ₹ 10,000 as:
“To a debit balance wrongly carried as credit, now rectified ... ₹ 10,000”.
 ix. In this case, both the accounts are incorrect. Furniture A/c and Rohit’s A/c are short by
₹ 27,000 each. Rectification will be made by passing the following Journal entry:
₹ ₹
Furniture A/c Dr. 27,000
To Rohit 27,000
Note: The error was committed while posting both the sides of the entry since credit
purchase of furniture will be recorded in General Journal. Both the sides of the entry are
posted with individual amounts.
26. (a)
Books of Berlia Ltd.
Machinery Account (Using Original Cost Method)
Amount Amount
Date Particulars J.F. Date Particulars J.F.
₹ ₹
2015 2015
Jul.01 To Bank (i) 85,000 Dec.31 By Depreciation 4,250
(5,600 + 24,000 +
Dec.31 By Balance c/d 80,750
5,000)
85,000 85,000
2016 2016
Jan.01 To Balance b/d (i) 80,750 Dec.31 By Depreciation
Sep.01 To Bank (ii) 2,60,000 (i) 8,500, (ii) 8,667 17,167
(2,50,000 + 10,000) Dec.31 By Balance c/d 3,23,583
(i) 72,250, (ii)
2,51,333
3,40,750 3,40,750
2017 2017
Jan.01 To Balance b/d 3,23,583 Dec.31 By Depreciation
(i) 72,250, (ii) (i) 8,500, (ii)
34,500
2,51,333 26,000
Dec.31 By Balance c/d
(i) 63,750, (ii)
2,89,083
2,25,333
 3,23,583 3,23,583
2018 To Balance b/d 2018
(i) 63,750, (ii)
Jan.01 2,89,083 Dec.31 By Depreciation
2,25,333
(i) 8,500, (ii)
34,500
26,000
Dec.31 By Balance c/d
(i) 55,250, (ii)
2,54,583
1,99,333
2,89,083 2,89,083
st
Hence, the balance on the machine account as on 1 Jan 2019 is ₹. 2, 54,583
Depreciation Account
Dr. Cr.
Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹
2015 2015
Dec.31 To Machinery 4,250 Dec.31 By Profit and Loss 4,250
4,250 4,250
2016 2016
Dec.31 To Machinery Dec.31 By Profit and Loss 17,167
(i) 8,500 (ii) 8,667 17,167
17,167 17,167
2017 2017
Dec.31 To Machinery Dec.31 By Profit and Loss 34,500
(i) 8,500 (ii) 26,000 34,500
34,500 34,500
2018 2018
Dec.31 To Machinery 34,500 Dec.31 By Profit and Loss 34,500
(i) 8,500 (ii) 26,000 34,500 34,500
Working notes: Calculation of depreciation per annum
(i) Depreciation on Machinery Purchased on July 01, 2015
= (56,000 + 24,000 + 5,000) × 10

100
= ₹ 8,500 pa
(ii) Depreciation on Machinery purchased on September 01, 2016.
= (2,50,000 + 10,000) × 10

100

= ₹ 26,000 pa
(b)
Machinery Account (Written Down Value method)
Dr. Cr.
Amount Amount
Date Particulars J.F. Date Particulars J.F.
₹ ₹
2015 2015
Jul.01 To Bank (i) 85,000 Dec.31 By Depreciation 4,250
(5,600 + 24,000 +
Dec.31 By Balance c/d 80,750
5,000)
85,000 85,000
2016 2016
Jan.01 To Balance b/d (i) 80,750 Dec.31 By Depreciation
Sep.01 To Bank (ii) 2,60,000 (i) 8,075, (ii) 8,667 16,742
(2,50,000 + 10,000) Dec.31 By Balance c/d
(i) 72,675, (ii)
3,24,008
2,51,333
3,40,750 3,40,750
2017 2017
Jan.01 To Balance b/d 3,24,008 Dec.31 By Depreciation
(i) 72,675, (ii) (i) 7,268, (ii)
32,401
2,51,333 25,133
Dec.31 By Balance c/d
(i) 65,407, (ii)
2,91,607
2,26,200
3,24,008 3,24,008
2018 To Balance b/d 2018
(i) 65,407, (ii)
Jan.01 2,91,607 Dec.31 By Depreciation
2,26,200
 (i) 6,540, (ii)
29,160
22,620
Dec.31 By Balance c/d
(i) 58,867, (ii)
2,62,447
2,03,580
2,91,607 2,91,607
st
Hence, balance on machine account as on 1 Jan 2019 is ₹2,62,447
Depreciation Account
Dr. Cr.
Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹
2015 2015
Dec.31 To Machinery 4,250 Dec.31 By Profit and Loss 4,250
4,250 4,250
2016 2016
Dec.31 To Machinery Dec.31 By Profit and Loss 16,742
(i) 8,075, (ii) 8,667 16,742
16,742 16,742
2017 2017
Dec.31 To Machinery Dec.31 By Profit and Loss 32,401
(i) 7,268, (ii) 25,133 32,401
32,401 32,401
2018 2018
Dec.31 To Machinery Dec.31 By Profit and Loss 29,160
(i) 6,540, (ii) 22,620 29,160
29,160 29,160
OR
Books of Bajrang Marbles
Machinery Account
Dr. Cr.
Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹
2010 Apr. 01 Bank 2,00,000 2011 Mar. 31 Depreciation 18,000
 Balance c/d 1,82,000
2,00,000 2,00,000
2011 Apr. 01 Balance b/d 1,82,000 2012 Mar. 31 Depreciation 18,000
2012 Mar. 31 Balance c/d 1,64,000
1,82,000 1,82,000
2012 Apr. 01 Balance b/d 1,64,000 2013 Mar. 31 Depreciation 18,000
2013 Mar. 31 Balance c/d 1,46,000
1,64,000 1,64,000
2013 Apr. 01 Balance b/d 1,46,000 2014 Mar. 31 Depreciation 18,000
2014 Mar. 31 Balance c/d 1,28,000
1,46,000 1,46,000
Hence, the closing balance of machinery account after 4 years is ₹. 1, 28,000.
Working notes: Calculation of annual depreciation
Cost of Asset = 1,80,000 + 10,000 + 10,000 = 2,00,000
(Original cost – Scrap Value )
Depreciation (p.a.) =
Estimated Life of Asset (years)
(1,80,000 + 10,000 + 10,000 – 20,000)
10
= ₹ 18,000/annum
The depreciation account is calculated as:
Depreciation Account
Dr. Cr.
Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹
2011 Mar. 31 Machinery 18,000 2011 Mar. 31 Profit and Loss 18,000
18,000 18,000
2012 Mar. 31 Machinery 18,000 2012 Mar. 31 Profit and Loss 18,000
18,000 18,000
2013 Mar. 31 Machinery 18,000 2013 Mar. 31 Profit and Loss 18,000
18,000 18,000
2014 Mar. 31 Machinery 18,000 2014 Mar. 31 Profit and Loss 18,000
 18,000 18,000
(b)
Machinery Account
Dr. Cr.
Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹
2010 2011
Apr. 01 Bank 2,00,000 Mar. 31 Balance c/d 2,00,000
2,00,000 2,00,000
2011 2012
Apr. 01 Balance b/d 2,00,000 Mar. 31 Balance c/d 2,00,000
2,00,000 2,00,000
2012 2013
Apr. 01 Balance b/d 2,00,000 Mar. 31 Balance c/d 2,00,000
2,00,000 2,00,000
2013 2014
Apr. 01 Balance b/d 2,00,000 Mar. 31 Balance c/d 2,00,000
2,00,000 2,00,000
Provision for Depreciation Account
Dr. Cr.
Date Particulars J.F. Amount ₹ Date Particulars J.F. Amount ₹
2011 2011
Mar. 31 Balance c/d 18,000 Mar. 31 Depreciation 18,000
18,000 18,000
2011 Apr. 01 Balance b/d 18,000
2012 Mar. 31 Balance c/d 36,000 2012 Mar. 31 Depreciation 18,000
36,000 36,000
2012 Apr. 01 Balance b/d 36,000
2013 Mar. 31 Balance c/d 54,000 2013 Mar. 31 Depreciation 18,000
54,000 54,000
2003 Apr. 01 Balance b/d 54,000
 2014 Mar. 31 Balance c/d 72,000 2014 Mar. 31 Depreciation 18,000
72,000 72,000
th
Hence, the provision for depreciation account at the end of 4 Year is ₹.72, 000
Depreciation Account
Dr. Cr.
Amount Amount
Date Particulars J.F. Date Particulars J.F.
₹ ₹
2011 2011
Provision for Profit and
Mar. 31 18,000 Mar. 31 18,000
Depreciation Loss
18,000 18,000
2012 Provision for 2012 Profit and
18,000 18,000
Mar. 31 Depreciation Mar. 31 Loss
18,000 18,000
2013 Provision for 2013 Profit and
18,000 18,000
Mar. 31 Depreciation Mar. 31 Loss
18,000 18,000
2014 Provision for 2014 Profit and
18,000 18,000
Mar. 31 Depreciation Mar. 31 Loss
18,000 18,000
Part B
27.
(c) Statement of affairs and conversion
Explanation:
The profit and loss of a firm in case of single entry system can be ascertained by the
following two methods
i. statement of affairs method and
ii. conversion method
From these method profit is calculated only.
OR

(b) One sided effect

 Explanation:
Sometimes for certain transactions, both aspects are recorded, for others one aspects are
recorded and some transactions are not even recorded. that's why it is called as un-
scientific system of accounting. This is incomplete system of accounting.
28.
(d) Indirect Expenses
Explanation:
Payment of Income Tax is considered an indirect expense for an enterprise.
29. (a) Cost Principle
Explanation:
As per Cost Principle. Wages paid for the installation of a machine is added to the cost of
machine because of the cost principle.
OR
(a) ₹ 78,000
Explanation:
₹ 78,000
Gross profit = sales + closing stock - Purchase - Wages
= 2,00,000 + 8,000 - 1,10,000 - 20,000
= 78,000
30. Trading Account
Dr Cr
Particulars Amt (Rs.) Particulars Amt (Rs.)
To COGS 45,00,000 By sales 72,00,000
To Gross Profit T/f. to P&L A/c 27,00,000
72,00,000 72,00,000
31. TRADING ACCOUNT
Dr. Cr.
Particulars Amount (₹) Particulars Amount (₹)
To Opening Stock 3,00,000 By Sales 14,07,000
To Purchases 8,50,000 By Closing Stock 2,80,000
To Carriage on Purchase 23,000
To Gross Profit (Bal. Fig.) 5,14,000
16,87,000 16,87,000
 Office and administration expenses and selling and distribution expenses are shown on the
debit side of the Profit or Loss account.
32. Closing Stock or Inventory is valued at cost or net realisable value (market value),
whichever is lower. For example
Adjustment
1. stock at the end of the year cost of ₹ 10,000 which market value is ₹ 12,000.
first its shown in trading at Credit of ₹ 10,000 and after that present in balance sheet in
asset side with ₹ 10,000.
33. Opening Statement of Affairs
as at April 1, 2022
Liabilities (₹) Assets (₹)
Creditors 14,900 Cash 1,200
Opening Capital (Bal. Fig.) 33,000 Debtors 16,800
Stock 22,400
Furniture 7,500
Total 47,900 Total 47,900
Closing Statement of Affairs
as at March 31, 2023
Liabilities (₹) Assets (₹)
Creditors 11,600 Cash 4,000
Closing Capital (Bal. Fig.) 60,000 Debtors 27,200
Stock 24,400
Investments 8,000
Furniture 8,000
Total 71,600 Total 71,600
Statement of Profit
as at March 31, 2023
Particulars Details (₹)
Closing Capital on March 31, 2023 60,000
Add: Drawings: [500 × 12] 6,000
66,000
Less: Opening Capital as on April 1, 2022 33,000
Additional Capital: [₹16,000 + 5%(16,000)] 16,800 49,800
Net Profit for the year 16,200
OR
STATEMENT OF AFFAIRS OF Govind
as on March 31, 2023
Dr. Cr.
Liabilities Amount (₹) Assets Amount (₹)
Creditors 22,000 Cash at Bank 5,000
Capital (Balancing Figure) 1,46,000 Cash in hand 3,000
Stock 44,000
Debtors 21,000
Fixed Assets 80,000
Scooter 15,000
1,68,000 1,68,000
Statement of Profit or Loss of Govind
for the year ended March 31, 2023
Particulars Amount (₹)
Capital at the end of the year 1,46,000
Add: Drawings made during the year (24,000 + 4,500 - 15,000) 13,500
Adjusted capital at the end of the year 1,59,500
Less: Capital in the beginning of the year 1,64,500
Loss Before Adjustment (5,000)
Less: Depreciation on Fixed Assets 8,000
Less: Outstanding on Scooter 750
Less: Bad Debts 1,000
Less: Provision for Doubtful Debts 1,000
Add: Accrued Commission 2,500
Loss Incurred during the year (13,250)
Final Statement of Affairs of Govind
as on March 31, 2023
 Amount Amount
Liabilities Assets
(₹) (₹)
Creditors 22,000 Cash in hand 3,000
Opening
1,64,500 Cash at Bank 5,000
Capital
Less: Net Loss 13,250 Stock 44,000
Less: Drawings 13,500 1,37,750 Debtors 21,000
Less: Bad Debts 1,000
Less: provision for Bad
1,000 19,000
Debts
Fixed Assets 80,000
Less: Depreciation 8,000 72,000
Scooter 15,000
Less: Depreciation 750 14,250
Accrued Commission 2,500
1,59,750 1,59,750
Balance sheet records transaction of capital nature and profit and loss records expenses
and income of revenue nature.
Amount Amount
Date Particulars L.F.
34. (Dr.) (Cr.)
Bad debts A/c Dr. 20,000
To Debtors A/c
20,000
(Further bad debts)

Provision for Bad debts A/c Dr. 35,000

To Bad debts A/c
35,000
(Bad debts adjusted)

Profit and Loss A/c Dr. 27,000

To Provision for Bad debts A/c
27,000
(Net amount charged to Profit & Loss A/c)

Staff welfare expenses A/c Dr. 22,400

To Purchases A/c 20,000
 To Input IGST A/c
2,400
(goods distributed to staff)

Rent A/c Dr. 30,000

Input IGST A/c Dr. 3,600
To Outstanding rent A/c 33,600
(Rent outstanding for two months)

Insurance expense A/c Dr. 10,000

Input IGST A/c Dr. 1,200
To Cash A/c 11,200
(Insurance expense paid)

Prepaid Insurance A/c Dr. 2,500

To Insurance expense A/c 2,500
(Prepaid insurance expense paid)

Accrued commission A/c Dr. 5,600

To Commission A/c 5,000
To Output IGST A/c 600
(accrued commission adjusted)
OR
TRADING AND PROFIT AND LOSS ACCOUNT
st
for the year ended 31 March, 2023
Dr Cr
Particulars Amt (₹) Particulars Amt(₹)
To Opening Stock 42,000 By Sales 1,55,000
By Closing
To Purchases 82,600 64,000
Stock
Less: Returns Outwards 1,600 81,000
To Carriage Inward 1,200
To Wages 4,000
Add: Outstanding 2,400 6,400
To Power 6,000
To Gross Profit c/d 82,400
2,19,000 2,19,000

By Gross Profit
To Rent 22,000 82,400
b/d
Add: Outstanding Rent
2,000 24,000
(₹ 22,000 × 1

11
)
To Salary 15,000
To Insurance 3,600
(1)
To Outstanding Interest on Bank Loan 1,000
To Bad Debts 600
Add: New Provision 1,000 1,600
To Depreciation on Machinery 5,000
To Balance (being profit before Charging
32,200
Manager's Commission) c/d
82,400 82,400
To Manager's Commission Outstanding
10
2,927 By Balance b/d 32,200
(32, 200 × )
110

To Net Profit Transferred to Capital A/c 29,273

32,200 32,200
BALANCE SHEET
as at 31st March, 2023
Amt. Amt.
Liabilities Assets
(₹) (₹)
8% Bank Loan 25,000 Cash in hand 1,500
Add: Outstanding Interest 1,000 26,000 Debtors 20,600
Creditors 18,900 Less: Further Bad Debts 600
Outstanding wages 2,400 20,000
Less: Provision for
Outstanding Rent 2,000 1,000 19,000
Doubtful Debts
Outstanding Manager's
2,927 Closing Stock 64,000
Commission
Capital 80,000 Furniture 14,000
Add: Net Profit 29,273 Machinery 50,000
1,09,273 Less: Depreciation 5,000 45,000
Less: Drawings (18,000) 91,273
1,43,500 1,43,500
Note (1): Interest on Bank Loan will be calculated for six months.