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Numerical Questions · Q13
Q.

Prepare trading and profit and loss account from the following particulars of M/s Neema Traders as on March 31, 2026.

Account TitleDebit ₹Credit ₹
Buildings23,000
Plant16,930
Carriage inwards1,000
Wages3,300
Purchases1,64,000
Sales return1,820
Opening stock9,000
Machinery2,10,940
Insurance1,610
Interest1,100
Bad debts250
Postage300
Discount1,000
Salaries3,000
Debtors3,900
Sales1,80,000
Loan8,000
Bills payable2,520
Bank overdraft4,720
Creditors8,000
Capital2,36,000
Purchases return1,910

Stock on March 31, 2026 ₹16,000.

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Direct items give a Gross Profit of ₹18,790 on the figures as given; carried to the P&L A/c (indirect expenses ₹7,260) this yields a Net Profit of ₹11,530. The NCERT key prints Gross Profit ₹17,850 / Net Profit ₹10,590 — ₹940 lower — which is flagged honestly below.

Concept & treatment. Only direct items enter the Trading A/c: opening stock, net purchases (purchases less purchases return), carriage inwards and wages on the debit; net sales (sales less sales return) and closing stock on the credit. Interest and discount here are on the debit of the trial balance, so they are treated as interest paid and discount allowed (P&L expenses).

Trading Account of M/s Neema Traders for the year ended March 31, 2026

ParticularsAmount (₹)ParticularsAmount (₹)
To Opening Stock9,000By Sales 1,80,000
To Purchases 1,64,000Less: Sales Return 1,8201,78,180
Less: Purchases Return 1,9101,62,090By Closing Stock16,000
To Carriage Inwards1,000
To Wages3,300
To Gross Profit c/d18,790
Total1,94,180Total1,94,180

Profit & Loss Account for the year ended March 31, 2026

ParticularsAmount (₹)ParticularsAmount (₹)
To Insurance1,610By Gross Profit b/d18,790
To Interest1,100
To Bad Debts250
To Postage300
To Discount1,000
To Salaries3,000
To Net Profit (to Capital)11,530
Total18,790Total18,790

Working Notes

  1. Net purchases = ₹1,64,000 − ₹1,910 = ₹1,62,090; Net sales = ₹1,80,000 − ₹1,820 = ₹1,78,180.
  2. Gross profit = (Net sales 1,78,180 + Closing stock 16,000) − (Opening stock 9,000 + Net purchases 1,62,090 + Carriage 1,000 + Wages 3,300) = 1,94,180 − 1,75,390 = ₹18,790. …

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