D.K Goal +1 New ISC Accountancy Solutions Chapter No. 20. Final Account- With Adjustment

Question No 01 Chapter No 20

01.The following are the balances extracted from the books of Raghunath Ji as on 31st March, 2019. From these balances, prepare his Trading and Profit & Loss Account and Balance Sheet as at that date

	Dr.	Cr.
Opening Stock	12,000
Purchases	40,000
Sales		86,000
Discount		400
Sales Return	6,000
Buildings	50,000
Debtors	16,000
Salaries	2,400
Office Expenses	1,200
Wages	10,000
Purchase Return		4,000
Interest		800
Travelling Expenses	400
Fire Insurance Premium	800
Machinery	20,000
Carriage on Purchases	700
Commission	400
Cash in hand	2,300
Rent and Taxes	1,800
Capital		62,000
Creditors		10,800
	1,64,000	1,64,000

Adjustments:-
1. Closing Stock was valued at 16,000.
2. Wages 2,000 and salaries 1,200 are outstanding.
3. Rent for two months at the rate of 500 per month is outstanding.
4. Depreciate Buildings by 5% and machinery by 10%.
5. Prepaid Insurance 200.

The solution of Question No 01 Chapter No 20: -

Trading Account

Particular		Amount	Particular		Amount
To Opening Stock A/c		12,000	By Sales	86,000
To Purchases A/c	40,000		Less: return	6,000	80,000
Less: Return	4,000	36,000
To Carriage		700	By Closing Stock		16,000
To Wages	10,000
Add: Outstanding	2,000	12,000
To Gross Profit		35,300
		96,000			96,000

Profit & Loss Account

Particular		Amount	Particular		Amount
Depreciation: (WN)			By Gross Profit		35,300
Machinery	2,000		By Discount		400
Building	2,500	4,500	By Interest		800
To Salaries	2,400
Add: Outstanding	1,200	3,600
To Insurance	800
Less: Prepaid	200	600
To Rent & Taxes	1,800
Add: Outstanding	1,000	2,800
To Office Expenses		1,200
To Travelling Expenses		400
To Commission		400
To Net Profit A/c		23,000
		36,500			36,500

Balance Sheet

Liabilities		Amount	Assets		Amount
Capital	62,000		Machinery	20,000
Add: Net Profit	23,000	85,000	Less: Depreciation	2,000	18,000
Creditors		10,800	Building	50,000
Outstanding Wages		2,000	Less: Depreciation	2,500	47,500
Outstanding Salaries		1,200	Closing Stock		16,000
Outstanding Rent		1,000	Prepaid Insurance		200
			Debtors		16,000
			Cash in Hand		2,300
		1,00,000			1,00,000

Working Note: -

Calculation of Depreciation

Depreciation on Building	=	5	X	50,000
		100
	=	Rs 2,500

Depreciation on Machinery	=	10	X	20,000
		100
	=	Rs 2,000

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D K Goel – New ISC Accountancy -(Class 11 - ICSE)- Solution

• Chapter 1 Evolution of Accounting & Basic Accounting Terms
• Chapter 2 Accounting Equations
• Chapter 3 Meaning and Objectives of Accounting
• Chapter 4 Double Entry System
• Chapter 5 Books of Original Entry – Journal 
• Chapter 6 Accounting for Goods and Service Tax (GST) (Coming soon)
• Chapter 7 Books of Original Entry – Cash Book (Coming soon)
• Chapter 8 Books of Original Entry – Special Purpose Subsidiary Books (Coming soon)
• Chapter 9 Ledger (Coming soon)
• Chapter 10 Trial Balance and Errors (Coming soon)
• Chapter 11 Bank Reconciliation Statement (Coming soon)
• Chapter 12 Depreciation (Coming soon)
• Chapter 13 Bills of Exchange (Coming soon)
• Chapter 14 Generally Accepted Accounting Principles(GAAP) 
• Chapter 15 Bases of Accounting
• Chapter 16 Accounting Standards and International Financial Reporting Standard(IFRS) (Coming soon)
• Chapter 17 Capital and Revenue 
• Chapter 18 Provisions and Reserves 
• Chapter 19 Final Accounts (Coming soon)
• Chapter 20 Final Accounts – With Adjustments (Coming soon)
• Chapter 21 Errors and their Rectification (Coming soon)
• Chapter 22 Accounts from Incomplete Records - Single Entry System (Coming soon)
• Chapter 23 Accounts of Not-for-Profit Organisations (Coming soon)
• Chapter 24 Computerised Accounting System (Coming soon)
• Chapter 25 Introduction to Accounting Information System (Coming soon)

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