Question No 07 Chapter No 18
7.From the following information prepare Trading Account for the year ended 31st March, 2018:
| Stock on 1st April, 2017 | 40,000 | Returns Outward | 80,000 |
| Purchases | 4,00,000 | Wages and Salaries | 50,000 |
| Sales | 3,80,000 | Returns Inward | 20,000 |
| Carriage Inwards | 20,000 | Stock on 31st March, 2018 | 1,30,000 |
The solution of Question No 07 Chapter No 18:-
| Trading Account | |||||
| Particulars |
Amount | Particulars |
Amount | ||
| To Opening Stock | 40,000 | By Sales | 3,80,000 | 4,07,000 | |
| To Purchases | 4,00,000 | Less: Return Inwards | 20,000 | ||
| To Opening Stock | 80,000 | 3,20,000 | |||
| To Carriage Inwards | 20,000 | ||||
| To Wages and Salaries | 50,000 | ||||
| By Closing Stock | 1,20,000 | ||||
| To Gross Profit | 50,000 | ||||
| 4,80,000 | 4,80,000 | ||||
Note: Closing Stock is taken at its Market Price
i. e. Rs 1, 20, 000 instead of its Cost i. e. Rs 1, 30, 000. This is because, as per Principle of Conservatism, Closing stock is taken at Cost or Market Price whichever is less.
Final Accounts: Definition and Explanation
Trading Account: Meaning, Format and Examples
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Also, Check out the solved question of previous Chapters: –
-
- Chapter No. 1 – Introduction to Accounting
- Chapter No. 2 – Basic Accounting Terms
- Chapter No. 3 – Theory Base of Accounting, Accounting Standards and International Financial Reporting Standards(IFRS)
- Chapter No. 4 – Bases of Accounting
- Chapter No. 5 – Accounting Equation
- Chapter No. 6 – Accounting Procedures – Rules of Debit and Credit
- Goods and Services Tax(GST)
- Chapter No. 7 – Origin of Transactions – Source Documents and Preparation of Vouchers
- Chapter No. 8 – Journal
- Chapter No. 9 – Ledger
- Chapter No. 10 – Special Purpose Books I – Cash Book
- Chapter No. 11 – Special Purpose Books II – Other Books
- Chapter No. 12 – Bank Reconciliation Statement
- Chapter No. 13 – Trial Balance
- Chapter No. 14 – Depreciation
- Chapter No. 15 – Provisions and Reserves
- Chapter No. 16 – Accounting for Bills of Exchange
- Chapter No. 17 – Rectification of Errors
- Chapter No. 18 – Financial Statements of Sole Proprietorship
- Chapter No. 19 – Adjustments in preparation of Financial Statements
- Chapter No. 20 – Accounts from incomplete Records – Single Entry System
- Chapter No. 21 – Computers in Accounting
- Chapter No. 22 – Accounting Software – Tally
- Chapter No. 5 – Accounting Equation
- Chapter No. 6 – Accounting Procedures – Rules of Debit and Credit
- Goods and Services Tax(GST)
- Chapter No. 8 – Journal
- Chapter No. 9 – Ledger
- Chapter No. 10 – Special Purpose Books I – Cash Book
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