This document contains information about various accounting concepts and records: 1. It discusses the components of the profit and loss account including manufacturing account, trading account, profit and loss account, and profit and loss appropriation account. 2. It describes the key components and order of a balance sheet including real accounts, personal accounts, unamortized nominal accounts, and the uniform format for company balance sheets. 3. It provides examples of trial balance entries for various accounts like salaries, purchases, drawings, debtors, creditors, and capital for a sample trial balance.

1. Profit & Loss Account
It is broken into –
1. Manufacturing A/c
2.
2 Trading A/c
3. Profit & Loss A/c
4. Profit & Loss Appropriation A/c
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2. Balance Sheet
• Depicts real a/c, p
p , personal a/c & unamortised
nominal a/c
• The sides & order of Assets & Liabilities
doesn’t matter
• Uniform format for companies in Sch. VI
Sch
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3. Trial Balance of Mr. Mohan
as on 31st March 2009
Particulars Debit Credit
Salaries 5,400
Insurance 2,500
Cash 400
Purchases 84,170
Rent received 3,150
Drawings 2,100
Bills Payable 3,900
Debtors 38,080
Opening Stock 29,500
Bank overdraft 9,700
Carriage 2,200
Creditors 4,200
Trade expenses 4,900
Sales returns 4,700
Machinery 12,000
Wages 45,000
Sales 1,47,200
Purchase return 3,900
Capital 58,900
Total 2,30,950 2,30,950
Closing Stock is Rs. 36,200

4. Books of Records
• Principal
p
• Ledger book
• Subsidiary
• Day books: credit purchase, credit sales & returns
• Journal proper
• Both
• C hb k
Cash book
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5. Entries in Journal (Proper)
• Opening Entries: new y – new books
p g year
• Closing Entries: transfer of nominal A/cs
• Transfer Entries: settlements, dishonour
settlements
• Rectification Entries: overpayment, under casting
• Adjustment Entries: depreciation, prepaid exp.
• Miscellaneous Entries: loss by fire, bad debt
y
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6. Adjustment Entries
• Prepaid expenses
p p
• Accrued expenses
• Closing stock
• Depreciation
• Provisions
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7. Trial Balance of Mr. Sharma (as on 31st March 2009)
Particulars Debit Credit
Drawings & Capital
D i & C it l 7,500
7 500 50,000
50 000
Purchases & Sales 72,100 95,000
Returns 1,300 2,700
Sundry Debtors & Creditors
S d D bt & C dit 18,200
18 200 35,750
35 750
Stocks (1st April, 2008) 19,800
Bad debts 3,000
Bills Receivables & Payables
Bill R i bl & P bl 12,000
12 000 23,000
23 000
Cash in hand 300
Office Expenses 6,210
Sales Van
S l V 15,000
15 000
Sales Van expenses 1,400
Discount 2,910
Rent & Rates
R t&R t 10,700
10 700
Telephone charges 1,050
Postage & Telegram 950
Furniture
F it 5,000
5 000
Printing & Stationery 2,750
Commission 8,400
Carriage inward
C i i d 3,200
3 200
Salaries & Wages 20,500
Total 2,09,360 2,09,360

8. Adjustment Exercise
Adjustments:
1. Closing Stock was valued at Rs. 61,700.
2. Depreciate Furniture at 10% and Sales Van at 20%.
3. Outstanding Rent amounted to Rs. 900
4. Bad Debts Rs. 200
5. Make a Provision for Doubtful Debts @ 5% on Debtors.
6. Charge one-fourth of Salaries and Wages to Trading
Account.
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