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6. What is Trial Balance? Discuss the errors which cannot be detected through Trial
Balance.
7. (i)
(ii)
(iii)
(2 + 10 = 12)
(3 4 = 12)
(4 3 = 12)
2 x 10 = 20
a)
b)
c)
d)
e)
f)
g)
h)
i)
j)
k)
l)
m) Distinguish between Profit & loss account and Profit & loss
Appropriation account.
n)
o)
2. The following is the Trial Balance extracted from the Books of Mr.X as at
31.12.2010.
Trial Balance as at 31st December, 2011
Ledger balances
Opening Stock
Debit.
(Rs.)
15,000
Ledger balances
Capital A/c
Credit
(Rs.)
100,000
Goodwill
8,000
Sales
Loose Tools
1,000
Returns
2,000
Investments
3,000
Bank Overdraft
9,000
Discounts
1,000
90,000
2,000
70,000
Miscellaneous Receipts
90,000
1,000
Sundry Creditors
50,000
73,000
3. From the following, pass the journal entries, prepare the necessary ledger
accounts, and also show how these items will appear in Profit and Loss account and
Balance Sheet.
Extract of Trial Balance as on 31 Dec 2010.
Debit(Rs.) Credit(Rs.)
Debtors
40,000
Bad Debts
2,000
Discount Allowed
1,000
Provision for Doubtful Debts
2,500
Provision for discount on Debtors.
900
Additional information:
Write off further bad debts Rs. 2,000
Provide for Bad and Doubtful debts at 5% on Debtors and Provision for discount on
debtors at 2%.
Carriage Inward
3,000
Loan
Returns
2,000
Interest on Investments
1,500
Carriage outward
1,000
1,450
Wages
6,000
2,000
Motive Power
2,000
Salaries
5,000
1,000
Insurance
1,000
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2,500
Simi and Sonu are partners in a firm, sharing profits and losses in the ratio of 3:1.
The profit and loss account of the firm for the year ending March 31, 2008 shows a
net profit of Rs. 1,50,000. Prepare the Profit and Loss Appropriation Account by
taking into consideration the following information:
(i) Partners capital on April 1, 2007: Simi Rs. 30,000: Sonu Rs. 60,000.
(ii) Current accounts balances on April 1, 2007: Simi Rs. 30,000 (cr.) Sonu Rs.
15,000 (cr.)
(iii) Simi and Sonu drew regularly @ Rs.2,000 and Rs.1,500 per month at the last
day of each month.
(iv) Interest on capital was allowed @ 5%p.a.
(v) Interest on drawings was to be charged @ 6% p.a.
(vi) Partners salaries: Simi Rs. 12,000 and Sonu Rs. 9,000.
(vii) 10% of the Net profit is to be transferred to General Reserve.
Also show the partners current accounts.
(2 + 10 = 12)
Printings
500
Bad Debt
500
Discounts
100
Furniture
20,000
70,000
Interest on Loan
Cash in hand
Sundry Debtors
TOTAL
350
7,000
20,000
3,30,950
3,30,950
You are asked to prepare the Trading A/c and Profit & Loss A/c for the year ended
on 31st December, 2011 and a Balance Sheet as at that date taking into
consideration the following:
(a) Closing Stock has been valued at Rs.40, 000.
(b) Outstanding Wages Rs. 2,000.
(c) Depreciate Buildings @ 5%, Machinery @ 10% and Loose Tools @ 20% p.a.
(e) Adjust the provision for doubtful Debts @ 5% on Debtors and make a provision
for discount on Debtors @ 5%.
(f) Make a Provision for Discount on Creditors @ 5%.