SHREE CLASSES

Book-Keeping & Accountancy

Online Homework Solution
FINAL ACCOUNT
Problem No. 5
From the following Trial Balance of Tambe and Pitale, you are required to prepare Trading and
Profit and Loss A/c. for the year ended 31st December 2000 and Balance Sheet as on that date after taking
into consideration the following adjustments.
Trial Balance as on 31st December 2000.
Debit Balance Amount Credit Balance Amount
Opening Stock 30,000 Capital Accounts :-
Purchases 50,000 Tambe 50,000
Return inwards 2,000 Pitale 75,000
Debtors 40,000 Bills Payable 12,000
Insurance Creditors 30,000
(for 3 years) (w.e.f. 1-7-2000) 6,000 Sales 70,000
Carriage inwards 500 Returns outwards 2,500
Wages 1,500 Wages outstanding 1,600
Salaries 2,500 Commission 400
Bills receivable 5,000 Discount 500
Sundry expenses 500
Drawings :-
Tambe 1,500
Pitale 2,500
Machinery (Pur. on 1/10/2000) 30,000
Buildings 53,000
Repairs to building 7,000
Carriage outwards 1,000
Rent 700
Advertisement 2,300
Cash in hand 6,000
2,42,000 2,42,000

1. Tambe and Pitale share Profits and Losses in their Capital proportion.
2. Closing stock was valued at cost < 25,500 and at market price < 30,000.
3. Outstanding Expenses :- Rent - 300, Advertisement - < 700.
4. Depreciate Machinery and Building at 10% p.a.
5. Goods worth < 10,000 were destroyed by Fire and Insurance Company admitted a claim of < 6,500
only.
6. Goods of < 1,000 were taken over by Tambe for his personal use, were not recorded in the Books of
Accounts.
A. M/S. TAMBE & PITALE
TRADING ACCOUNT
Dr. For the year ended 31.12.2000 Cr.
Particulars Amount Amount Particulars Amount Amount
To Opening Stock 30,000 By Sales 70,000
To Purchases 50,000 Less :
Less : Returns 2,000 68,000
Returns 2,500 47,500 By Loss by fire 10,000
To Carriage inward 500 (Total loss)
To Wages 1,500 By Tambe’s Drawing 1,000

By Closing Stock 25,500

To Gross Profit B/d 25,000
(Bal. Fig.)

1,04,500 1,04,500

Profit & Loss Account

Dr. For the year ended 31.12.2000 Cr.
Particulars Amount Amount Particulars Amount Amount
By Gross Profit B/d 25,000
To Insurance 6,000 By Commission 400
(For 3 years By Discount 500
w.e.f. 1-7-2000)
Less :
Prepaid 5,000 1,000
To Salaries 2,500
To Sundry Expenses 500
To Repairs to building 7,000
To Carriage outward 1,000
To Rent 700
Add :
Outstanding 300 1,000
To Advertisement 2,300
Add :
Outstanding 700 3,000
(continued .....
 Particulars Amount Amount Particulars Amount Amount
To Loss by fire 3,500
(Actual Loss)
To Depreciation
Machinery 750
Building 5,300 6,050

To Capital A/c
(Net Profit)
Tambe (2) 140
Pitale (3) 210 350

25,900 25,900

M/S. TAMBE & PITALE

Dr. Balance Sheet as on 31.12.2000 Cr.
Liabilities Amount Amount Assets Amount Amount
Capital Debtors 40,000
Tambe 47,640 Bills Receivable 5,000
Pitale 72,710 1,20,350 Machinery 30,000
Bills Payable 12,000 (Purchased on 1-10-2000)
Creditors 30,000 Less :
Wages outstanding 1,600 10% Depreciation 750 29,250
Outstanding Building 53,000
Rent 300 Less :
Advertisement 700 1,000 10% Depreciation 5,300 47,700
Cash in hand 6,000
Closing Stock 25,500
Insurance Claim 6,500
Prepaid Insurance 5000

1,64,950 1,64,950
Working Note :

Dr. Capital Account Cr.

Particulars Tambe Pitale Particulars Tambe Pitale

To Drawing A/c 1,500 2,500 By Balance B/d 50,000 75,000
To Drawing A/c 1,000 – By Net Profit 140 210
(Goods)

To Balance c/d 47,640 72,710

50,140 75,210 50,140 75,210
 SHREE CLASSES
Book-Keeping & Accountancy
Online Homework Solution
FINAL ACCOUNT
Problem No. 6
From the following Trial Balance of Kranti and Narendra you are required to prepare Trading,
Profit and Loss Account for the year ended 31st December, 1996 and Balance Sheet as on that date :-
Trial Balance as on 31st December 1996.
Name of Account Debit Credit
Capital Account :-
Kranti – 60,000
Narendra – 40,000
Drawings Account :-
Narendra 2,000 –
Kranti 1,000 –
Stock on 1-1-1996 44,000 –
Bills Receivable 1,800 –
Purchases and Sales 1,90,000 3,02,000
Returns 6,000 2,000
Salaries 10,000 –
Carriage Outward 1,400 –
Wages 24,000 –
Insurance 1,600 –
Discount received – 200
Postage 800 –
Debtors and Creditors 70,400 64,200
Furniture 24,000 –
Cash in hand 9,800 –
Machinery 80,000 –
Rent and Taxes 1,200 –
Printing and Stationery 400 –
4,68,400 4,68,400

Adjustments :
1. Closing Stock as on 31-12-1996 was valued at < 56,000.
2. Outstanding expenses were Wages < 2,000 & Salaries < 930.
3. Goods distributed as free samples were < 2,000.
4. Interest on partners’ capital at 7% p.a. was to be provided.
5. Prepaid insurance was < 100.
6. Depreciate furniture at 10% and machinery at 5%.
7. Create Reserve for bad and doubtful debts at 5% on debtors.
A. M/S. KRANTI & NARENDRA
TRADING ACCOUNT
Dr. For the year ended 31.12.1996 Cr.
Particulars Amount Amount Particulars Amount Amount
To Opening Stock 44,000 By Sales 3,02,000
To Purchases 1,90,000 Less :
Less : Returns 6,000 2,96,000
Returns 2,000 1,88,000 By Free samples 2,000
To Wages 24,000
Add :
Outstanding 2,000 26,000

By Closing Stock 56,000

To Gross Profit c/d 96,000
(Bal. Fig.)
3,54,000 3,54,000

Profit & Loss Account

Dr. For the year ended 31.12.1996 Cr.
Particulars Amount Amount Particulars Amount Amount
By Gross Profit B/d 96,000
To Salaries 10,000 By Discount 200
Add :
Outstanding 930 10,930
To Carriage outward 1,400
To Insurance 1,600
Less :
Prepaid 100 1,500
To Postage 800
To Rent & Taxes 1,200
To Printing & Stationery 400
To Advertisement 2,000
(Free Sample)
To Interest on capital
Kranti 4,200
Narendra 2,800 7,000

(continued .....
 Particulars Amount Amount Particulars Amount Amount
To Depreciation
Furniture 2,400
Machinery 4,000 6,400
To Bad Debts –
Add :
New Bad Debts 0
Add : 0
New R.D.D. 3,520
Less : 3,520
Old R.D.D. 0 3,520
To Capital A/c
(Net profit)
Kranti (1) 30,525
Narendra (1) 30,525 61,050

96,200 96,200

M/S. KRANTI & NARENDRA

Dr. Balance Sheet as on 31.12.1996 Cr.
Liabilities Amount Amount Assets Amount Amount
Capitals Debtors 70,400
Kranti 93,725 Less :
Narendra 71,325 1,65,050 New Bad Debts 0
Creditors 64,200 Less : 70,400
Outstanding New R.D.D. 3,520 66,880
Wages 2,000 Furniture 24,000
Salaries 930 2,930 Less :
10% Depreciation 2,400 21,600
Cash in hand 9,800
Machnery 80,000
Less :
5% Depreciation 4,000 76,000
Closing Stock 56,000
Prepaid insurance 100
Bills Receivable 1,800
2,32,180 2,32,180
Working Note :

Dr. Capital Account Cr.

Particulars Kranti Narendra Particulars Kranti Narendra

To Drawing A/c 1,000 2,000 By Balance B/d 60,000 40,000
By Interest on capital 4,200 2,800
By Net profit 30,525 30,525

To Balance c/d 93,725 71,325

94,725 73,325 94,725 73,325

 SHREE CLASSES
Book-Keeping & Accountancy
Online Homework Solution
FINAL ACCOUNT
Problem No. 7
From the following Trial Balance of Somnath and Ambadas being equal partners, you are required
to prepare Trading and Profit and Loss Account for the year ended 31st December, 1995 and Balance Sheet
as on that date after taking into consideration the additional information.
Trial Balance as on 31-12-1995.
Name of Account Debit Credit
Opening Stock 60,000 –
Drawing & Capital :
Somnath 1,000 22,000
Ambadas 1,500 18,000
Insurance 600 –
Reserve Fund – 21,600
Salaries and Wages 4,500 –
Carriage 2,500 –
Purchase and Sales 65,000 1,30,000
Bills Receivable and Bills Payable 600 1,000
Rent 3,500 –
Reserve for Bad and doubtful debts – 800
Debtors and Creditors 18,000 16,000
Returns 1,000 500
Machinery 12,000 –
Travelling expenses 3,000 –
Cash at Bank 1,000 –
Building 30,000 –
Office expenses 2,700 –
Advertisement (for 3 years) 3,000 –
TOTAL 2,09,900 2,09,900

Adjustments :
1. Closing Stock Cost < 25,000 and Market Price < 30,000.
2. Allow interest on Capital at 10% p.a.
3. Prepaid Insurance < 50.
4. Provide for R.B.D.D. at 5% on debtors.
5. Uninsured goods costing < 3,000 were destroyed by fire.
6. Outstanding expenses – Salaries < 1,000, Rent < 500.
7. Provide depreciation on Machinery at 20%; Building 2½%.
A. M/S. SOMNATH & AMBADAS
TRADING ACCOUNT
Dr. For the year ended 31.12.1995 Cr.
Particulars Amount Amount Particulars Amount Amount
To Opening Stock 60,000 By Sales 1,30,000
To Purchases 65,000 Less
Less Returns 1,000 1,29,000
Returns 500 64,500 By Loss by fire 3,000
To Carriage 2,500 (Total loss)

By Closing Stock 25,000

To Gross Profit c/d 30,000
(Bal. Fig.)
1,57,000 1,57,000

Profit & Loss Account

Dr. For the year ended 31.12.1995 Cr.
Particulars Amount Amount Particulars Amount Amount
By Gross Profit B/d 30,000
To Insurance 600
Less :-
Prepaid 50 550
To Salaries & Wages 4,500
Add :-
Outstanding 1,000 5,500
To Rent 3,500
Add :-
Outstanding 500 4,000
To Travelling Expenses 3,000
To Office Expenses 2,700
To Advertisement 3,000
(For 3 years)
Less :-
Prepaid 2,000 1,000
To Interest on capital
Somnath 2,200
Ambadas 1,800 4,000
To Loss by fire 3,000
(Actual loss)
 Particulars Amount Amount Particulars Amount Amount
To Depreciation
Machinery 2,400
Building 750 3,150
To Bad Debts –
Add :-
New bad Debs 0
Add :- 0
New R.D.D. 900
Less :- 900
Old R.D.D. 800 100
To Capital A/c
(Net Profit)
Somnath (1) 1,500
Ambadas (1) 1,500 3,000
30,000 30,000

M/S. SOMNATH & AMBADAS

Dr. Balance Sheet as on 31.12.1995 Cr.
Liabilities Amount Amount Assets Amount Amount
Capitals Bill Receivable 600
Somnath 24,700 Debtors 18,000
Ambadas 19,800 44,500 Less :
New Bad Debts 0
Less : 18,000
New R.D.D. 900 17,100
Reserve Fund 21,600 Machinery 12,000
Bill Payable 1,000 Less :-
Creditors 16,000 20% Depreciation 2,400 9,600
Outstanding Cash at Bank 1,000
Salaries & Wages 1,000 Building 30,000
Rent 500 1,500 Less :-
2½% Depreciation 750 29,250
Closing Stock 25,000
Prepaid Insurance 50
Prepaid Advertisement 2,000
84,600 84,600
Working Note :

Dr. Capital Account Cr.

Particulars Somnath Ambadas Particulars Somnath Ambadas

To Drawing A/c 1,000 1,500 By Balance B/d 22,000 18,000
By Interest on capital 2,200 1,800
By Net profit 1,500 1,500

To Balance c/d 24,700 19,800

25,700 21,300 25,700 21,300

 SHREE CLASSES
Book-Keeping & Accountancy
Online Homework Solution
FINAL ACCOUNT
Problem No. 8
From the following Trial Balance of Jitendra and Mahendra, you are required to prepare Trading
and Profit and Loss Account for the year ended 31st December, 1994 and Balance Sheet as on that date
after considering the adjustment given below :
Trial Balance as on 31st December 1994.
Debit Balance Amount Credit Balance Amount
Stock (1-1-1994) 35,000 Sales 3,30,000
Salary and Wages 9,200 Discount 4,800
Cash 10,000 Creditors 20,000
Purchases 2,25,200 Bank Overdraft 10,000
Sundry expenses 8,600 Interest on Investment 7,200
Productive wages 14,000 Capital :
Bills receivable 8,000 Jitendra 60,000
Law charges 3,000 Mahendra 40,000
Bad debts 1,000
Works expenses 6,000
Commission 3,000
Investment 20,000
Debtors 40,000
Trade Mark 8,000
Tools and Equipments 6,000
Furniture 12,000
Goodwill 13,000
Building 50,000
4,72,000 4,72,000

Adjustments :
1. Partners share profits and losses in their capital ratio.
2. The closing stock - Cost price < 40,000 and Market Price < 45,000.
3. Jitendra has withdrawn goods worth < 1,200 for his own use should be properly adjusted.
4. Uninsured goods worth < 1,000 were destroyed by fire.
5. < 450 to be written off as bad debts from debtors.
6. Unpaid salary and wages < 800 and printing bill < 1,200.
7. Depreciate Building at 7½% p.a.
A. M/S. JITENDRA & MAHENDRA
TRADING ACCOUNT
Dr. For the year ended 31.12.1994 Cr.
Particulars Amount Amount Particulars Amount Amount
To Opening Stock 35,000 By Sales 3,30,000
To Purchases 2,25,200 By Jitendra’s Drawing 1,200
To Productive wages 14,000 By Loss by fire 1,000
To Work expenses 6,000 (Total Loss)

By Closing Stock 40,000

To Gross Profit c/d 92,000
(Bal. Fig.)
3,72,200 3,72,200

Profit & Loss Account

Dr. For the year ended 31.12.1994 Cr.
Particulars Amount Amount Particulars Amount Amount
By Gross Profit B/d 92,000
To Salary & Wages 9,200 By Discount 4,800
Add By Interest on investment 7,200
Unpaid 800 10,000
To Sundry Expenses 8,600
To Law charges 3,000
To Bad Debts 1,000
Add
New 450 1,450
To Commission 3,000
To Loss by fire 1,000
(Actual Loss)
To Printing bill 1,200
To Depreciation on Building 3,750

To Capital A/c
(Net profit)
Jitendra (3) 43,200
Mahendra (2) 28,800 72,000
1,04,000 1,04,000
 M/S. JITENDRA & MAHENDRA
Dr. Balance Sheet as on 31.12.1994 Cr.
Liabilities Amount Amount Assets Amount Amount
Capitals Cash 10,000
Jitendra 1,02,000 Bills Receivable 8,000
Mahendra 68,800 1,70,800 Investment 20,000
Debtors 40,000
Less :
Bad Debts 450 39,550
Creditors 20,000 Trade Mark 8,000
Bank overdraft 10,000 Tools & Equipments 6,000
Outstanding Furniture 12,000
Salary & Wages 800 Goodwill 13,000
Printing bill 1,200 2,000 Building 50,000
Less :
7½% Depreciation 3,750 46,250
Closing Stock 40,000

2,02,800 2,02,800

Working Note :

Dr. Capital Account Cr.

Particulars Jitendra Mahendra Particulars Jitendra Mahendra

To Drawing A/c 1,200 – By Balance B/d 60,000 40,000

(Goods) By Net Profit 43,200 28,800

To Balance c/d 1,02,000 68,800

1,03,200 68,800 1,03,200 68,800