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Q.

Following is the Trial Balance of Mr. Roy, as on 31st December, 2017:

ParticularsDr. (Rs.)Cr. (Rs.)
Capital1,00,000
Bills Payable22,000
Cash1,200
Purchases1,20,000
Opening Stock35,000
Creditors24,000
Debtors50,000
Machinery60,000
Sales2,00,000
Furniture15,000
Bills Receivable20,000
Rent & Rates10,000
Provision for Bad Debts1,200
Wages16,000
Salaries20,000
Total3,47,2003,47,200

Prepare Trading and Profit & Loss Account of Mr. Roy for the year ended 31st December, 2017 and Balance Sheet as on that date after taking into consideration the following information:

  1. Closing Stock on 31st December, 2017 was Rs. 50,000.
  2. Depreciation on furniture is to be charged @ 5% p.a.
  3. Provision on Debtors is to be maintained @ 2%.
  4. Outstanding salary on 31st December, 2017 was Rs. 2,000.
West Bengal WbchseWBCHSE West Bengal Class-XI Commerce Board 2022Subjective· 10mImportance★★★★★est
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For Mr. Roy, year ended 31 Dec 2017: Gross Profit Rs. 79,000, Net Profit Rs. 46,450, and a Balance Sheet totalling Rs. 1,94,450 after closing stock, depreciation on furniture, provision for doubtful debts and outstanding salary.

This is a standard WBCHSE Class 11 Accountancy final-accounts problem (Trading A/c, Profit & Loss A/c and Balance Sheet), the same final-accounts pattern used in the NCERT/CBSE commerce curriculum.

Working notes:

  • Depreciation on furniture @ 5% on Rs. 15,000 = Rs. 750.
  • New provision for doubtful debts @ 2% on debtors Rs. 50,000 = Rs. 1,000. Old provision Rs. 1,200 (no bad debts given), so the excess Rs. 1,200 - 1,000 = Rs. 200 is written back (credited to P&L).
  • Outstanding salary Rs. 2,000 is added to salaries and shown as a liability.

Trading Account of Mr. Roy for the year ended 31st December, 2017

Dr.Rs.Cr.Rs.
To Opening Stock35,000By Sales2,00,000
To Purchases1,20,000By Closing Stock50,000
To Wages16,000
To Gross Profit c/d79,000
Total2,50,000Total2,50,000

Profit & Loss Account for the year ended 31st December, 2017

Dr.Rs.Cr.Rs.
To Rent & Rates10,000By Gross Profit b/d79,000
To Salaries 20,000 + Outstanding 2,00022,000By Provision for Doubtful Debts (excess written back: 1,200 - 1,000)200
To Depreciation on Furniture750
To Net Profit (transferred to Capital)46,450

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