From the following Trial Balance of M/s Nandana Traders as on 31st March, 2024, prepare :
(1) Trading and Profit & Loss Account for the year ended 31st March, 2024 and
(2) Balance Sheet as on that date.
Trial Balance as on 31st March, 2024
| Particulars | Dr (₹) | Cr (₹) |
|---|---|---|
| Opening Stock | 15,000 | |
| Purchases | 50,000 | |
| Wages | 5,000 | |
| Carriage Inwards | 2,000 | |
| Salaries | 6,000 | |
| Rent | 3,000 | |
| Debtors | 20,000 | |
| Cash | 4,000 | |
| Furniture | 10,000 | |
| Plant and Machinery | 40,000 | |
| Capital | 80,000 | |
| Sales | 65,000 | |
| Creditors | 10,000 | |
| Total | 1,55,000 | 1,55,000 |
Adjustments :
(1) Closing Stock valued at ₹ 12,000.
(2) Rent outstanding ₹ 1,000.
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Start your 14-day free trial to unlock the full solution →Prepare Trading and Profit & Loss Account and the Balance Sheet of M/s Nandana Traders. Trading A/c gives Gross Profit ₹5,000 (both sides ₹77,000). The P&L A/c charges Salaries ₹6,000 and Rent ₹4,000 (₹3,000 + ₹1,000 outstanding) against the ₹5,000 gross profit, giving a Net Loss of ₹5,000. Capital falls to ₹75,000, and the Balance Sheet foots at ₹86,000 on both sides.
Adjustments applied: (1) Closing Stock ₹12,000 - shown on the credit of the Trading A/c and as an asset in the Balance Sheet. (2) Rent outstanding ₹1,000 - added to Rent in the P&L A/c and shown as a current liability in the Balance Sheet.
1. Trading and Profit & Loss Account of M/s Nandana Traders for the year ended 31st March, 2024
| Dr. Particulars | Amount (₹) | Cr. Particulars | Amount (₹) |
|---|---|---|---|
| To Opening Stock | 15,000 | By Sales | 65,000 |
| To Purchases | 50,000 | By Closing Stock | 12,000 |
| To Wages | 5,000 | ||
| To Carriage Inwards | 2,000 | ||
| To Gross Profit c/d | 5,000 | ||
| Total | 77,000 | Total | 77,000 |
| To Salaries | 6,000 | By Gross Profit b/d | 5,000 |
| To Rent 3,000 + Outstanding 1,000 | 4,000 | By Net Loss (transferred to Capital A/c) | 5,000 |
| Total | 10,000 | Total | 10,000 |
Working: Gross Profit = (Sales 65,000 + Closing Stock 12,000) - (Opening Stock 15,000 + Purchases 50,000 + Wages 5,000 + Carriage Inwards 2,000) = 77,000 - 72,000 = ₹5,000. Net result = Gross Profit 5,000 - (Salaries 6,000 + Rent 4,000) = 5,000 - 10,000 = Net Loss ₹5,000.
2. Balance Sheet of M/s Nandana Traders as on 31st March, 2024
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