Exercises · Q5
Q.A trader's position was as follows. On 1 April 2024: Cash ₹4,000; Stock ₹12,000; Debtors ₹9,000; Machinery ₹8,000; Creditors ₹7,000. On 31 March 2025: Cash ₹5,500; Stock ₹15,000; Debtors ₹11,000; Machinery (after depreciation) ₹7,500; Creditors ₹8,000. During the year he withdrew ₹4,000 for personal use and introduced no additional capital. Find the profit for the year.
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Start your 14-day free trial to unlock the full solution →Statement of Affairs as on 1 April 2024
| Liabilities | Amount (₹) | Assets | Amount (₹) |
|---|---|---|---|
| Creditors | 7,000 | Cash | 4,000 |
| Capital (balancing figure) | 26,000 | Stock | 12,000 |
| Debtors | 9,000 | ||
| Machinery | 8,000 | ||
| Total | 33,000 | Total | 33,000 |
Statement of Affairs as on 31 March 2025
| Liabilities | Amount (₹) | Assets | Amount (₹) |
|---|---|---|---|
| Creditors | 8,000 | Cash | 5,500 |
| Capital (balancing figure) | 31,000 | Stock | 15,000 |
| Debtors | 11,000 | ||
| Machinery | 7,500 | ||
| Total | 39,000 | Total | 39,000 |
Profit = Capital at the end − Capital at the beginning − Additional Capital introduced + Drawings
= 31,000 − 26,000 − 0 + 4,000
= 5,000 + 4,000
= ₹9,000. …
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