2. Trial Balance of previous Ex.
Name of the Account Debit Credit
Cash 7000
bank 20500
Purchase 28000
Sales 24000
Travellling expenses 3000
salary 2000
Telephone expenses 1500
Depreciation 200
Discount 500
Capital 47000
Furniture 9800
Outstanding expenses 1500
Total 72500 72500
Trial balance as on 31 Dec 2011
3. Trading account:
This statement discloses the result of
trading operations carried out by the
organization. The final result disclosed
by the trading account is the gross
profit/ loss earned by the organisation.
4. Trading account for the year ended 31 march 2011
Particulars AmountParticulars Amount
Opening stock Sales
Purchases (net of sales return)
( net of purchase return)
Carriage inwards
cost of production closing stock
Gross Profit Finished goods
Total Total
5. Profit and loss statement
It discloses the final result of business
transactions.
It lists out all the expenses and losses
against the incomes.
6. Profit and loss statement for the year ended on 31 march 2011
Particulars Amount Particulars Amount
Administrative Expenses gross profit b/f
Office salaries
postage and stationary other income
travelling and conveyance discount received
legal charges commission recd
office rent
depreciation non trading income
audit fees interest received
insurance rent received
repairs and renewals
selling and distributive expenses
advertisement abnormal income
carriage outward profit on sale on assets
free samples
bad debts
sales commission
Financial expenses
interest and bank charges
Other expenses
loss on sale of assets
salary to working partners
interest on capital
provision for taxation
Net profit trfd to balance sheet
Total Total
7. Balance sheet
It discloses the financial status of the
organisation in terms of its assets and
liabilities at any given point of time.
It has two sides
Liabilities ( sources of funds)
Assets ( application of funds)
8. Balance sheet as on 31 march 2011
Liabilities Amount Assets Amount
Capital ( less Drawing) Fixed assets
land
Long term liabilities Building
loan from Bank machinery
Furniture
Current Liabilities Vehicles
Creditors Computers
Advances from Customers
Outstanding expenses Investment
Income recd in advance Current assets
Stock
Debtors
cash balance
bank balance
prepaid expenses
Total Total
Add profit/ less loss
9. PARTICULARS DEBIT CREDIT
Debtors 500000
Creditors 200000
outstanding liabilities for expenses 55000
Wages 100000
Carriage Outwards 110000
Carriage Inwards 50000
General Expenses 70000
Cash Discount 20000
bad Debts 10000
Motor Car 240000
Printing and Stationary 15000
Furniture and fittings 110000
Advertisement 85000
Insurance 45000
Salesman's Commission 87500
Postage and telephones 57500
Salaries 160000
Rent and Taxex 25000
Drawings 20000
Capital Account 1443000
Purchases 1550000
Sales 1987500
Stock as on 1st April 250000
Cash at bank 60000
cash in hand 10500
3630500 3630500
10. Adjustments:
Stock as on 31 march 2009 was valued at 725000
A provision for bad and doubtful debts are to be made to the
extent of 5% on debtors
Depreciate furniture & fixture by 10 % and motor car by 20%
Owner had withdrawn goods worth Rs. 25000
Sales include goods worth Rs. 75000 sent out to XYZ company
on approval and remaining unsold on 31 mar 2009. The cost of
the goods was Rs. 50000.
The salesman was entitled to a commission of 5% on the total
sales
Debtors includes Rs. 25000 bad debts.
Printing and stationary expenses of Rs. 55000 relating to had
not been provided in that year but were paid in this year by
debiting outstanding liabilities.
Purchase include purchases of furniture worth Rs. 50000.
