Dhananjayrao Gadgil College of Commerce , Satara

Rayat Shikshan Sansthas

Dhananjayrao Gadgil College of Commerce,

Satara.
(An Autonomous College, Affiliated to Shivaji University, Kolhapur)

Financial Accounting Paper I

Prepared By

1. Mr. P.J. Sutar

2. Mr. S.P. Jadhav
3. Mr.R.B. Pawar

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Problems on Professionals Accounts

Problem 1 ) Ganesh is Medical practitioner. On 1st April 2012 he had the following assets in
his profession .Equipments and Furniture Rs 40,000. Telephone Rs 3,000 , Stock of medicines
Rs 2,000 and cash in hand Rs 7,000 . The following is the Receipts and Payment account of the
profession for the year ended 31st March 2013.

Receipts and Payment account

Receipts Rs Payments Rs

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 Dhananjayrao Gadgil College of Commerce , Satara

Cash in hand 7,000 Purchase of medicine 35,000

Consultation Fees 41,000 Salary of Assistant 10,000
Fees from operations 10,000 Purchase of motor car 20,000
Income from Lectures 5,000 Postage and Stationary 700
Sale of Medicines 40,000 Telephone Charges 600
Professional periodicals 300
Purchase of equipment 10,000
Motor Car Expenses 1,500
Subscription to IMA 300
Household Drawings 12,000
Travelling Expenses 6,600
Cash in hand 6,000
Total 1,03,000 Total 1,03,000

After considering the following information ,ascertain the net income from profession of
Dr.Ganesh for the year ended 31st March 2013 and prepare a Balance sheet of the same as at that
date

i) Stock of medicines on 31.03. 2013 was Rs 3,000

ii) Depreciate equipment and furniture by 5% p.a.
iii) Consultation fees accrued Rs 6,000
iv) Salary of assistant due Rs 2,000
v) 50% of the service of motor car enjoyed by the family of ganesh
vi) Rs 2,000 was still payable to the suppliers of medicines
vii) Provide Rs 5,000 for income tax of his profession

Problem -2 ) Dr.Kulkarni commenced practice as a dental surgeon,investing Rs-1,00,000 in

Equipments on 1st April ,2014 was as follows:

Receipts and Payments account

Receipts Rs Payments Rs

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 Dhananjayrao Gadgil College of Commerce , Satara

To Fees 2,40,000 By Salaries to Staff 32,000

To Sundry Receipt 2,000 By Rent 19,200
To Equipments sold 8,000 By Journals 4,000
By Purchase of drugs 20,000
By Equipments 16,000
By Drawings 80,000
By Library Books 16,000
By Conveyance 8,000
By Cash and BankBalance 54,800
Total 2,50,000 Total 2,50,000

1) Rs 8,000 of the fees are still outstanding.

2) Equipments purchased and sold on 31st Dec .2014.The Cost of equipment sold Rs-12,000 .

3) Depreciation on equipments 20% p.a.

4) Salary not paid Rs 4,000.

5) 30% of conveyance is for Domestic purpose .

6) Stock of drugs on this date Rs 6,000.

Prepare Receipts and Expenditure Account for the year ended 31-03-2015 and a Balance Sheet
as on that date.

Problem No 3 ) Shri Ramchoudhari is a medical practitioner. He lives in a rented house

consisting of four rooms ,one of which is used for his chambr.HisReceits and Payments account
(recording all cash transactions of the profession and household) for the year ending 31-03-2015

Receipts and Payments Account

For the year ended 31-03-2015

Receipts Rs Payments Rs

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 Dhananjayrao Gadgil College of Commerce , Satara

Cash in Hand 500 Drugs purchased 25,000

Cash at bank 15,000 Ration 500
Fees collected 25,000 Marketing and Milk 5,000
Drugs Sold 40,000 Entertain to family guests 2,000
Interest on household 2,000 Other household expenses 5,000
Investment Rent 6,600
Motor Car Expenses 2,000
Salaries and Wages 6,600
Telephone Expenses 1,000
Television 6,000
Life Insurance Premium 3,600
Cash in hand 4,000
Cash in Bank 15,200

Total 82,500 Total 82,500

Prepare Receipt and Expenditure A/c for the profession and Income and Expenditure Account
(for the household Transaction) for the ended 31st March 2015 after considering the following.

i) Rent Rs -600 for March 2015 is outstanding.

ii) Electricity charges Rs 600 and Education expenses Rs 1,000 were met by
Mrs.Choudhari but had not been reimbursed to her.
th of the following expenses related to profession .
Rent ,Motor car expenses ,Salaries and wages ,Electricity Charges And Telephone.
iii) Stock of drugs Rs 2,000 .
iv) The entire profit of the profession as to be taken as revenue of the household.

Problem No 4 ) Dr. Gupta commenced medical practice in April 2014, He prepared the
following Receipts and Payment Account for the year ended 31-03-2015.

Receipts and Payment Account

Receipts Rs Payments Rs

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 Dhananjayrao Gadgil College of Commerce , Satara

To Cash Introduced 30,000 By Equipment 20,000

To Receipts from Dispensing 29,000 By Furniture 5,000
To Visits 40,000 By Drugs 10,000
To Miscellaneous 1,000 By Assistants Salary 6,000
By Rent 5,000
By Conveyance 3,000
By Stationery 600
By Lighting 700
By Journals 900
By Drawing 28,000
By Balance C/d 20,800
Total 1,00,000 Total 1,00,000

Adjustments

Rs- 4,000 were still outstanding on account of visits. Assisants salary Still payable is Rs 600
stock of drugs on hand was estimated at Rs 2,000 .Furniture and Equipment are subject to
depreciation at 10% , 50% of conveyance is for domestic purpose.

Prepare Receipts and Expenditure Account for the year ended 31-03-2015 and Balance Sheet as
on that date.

Problem No 5 ) Dr. Manish commenced practice as a Dentist on 1stApril ,2014. He supply you
the following Receipts and Payment Account for the year ending 31st March ,2015.

Receipts and Payments account

Receipts Rs Payments Rs
To Capital introduced 25,000 By Furniture 10,000
By Equipments 12,500
To Visit Fees 80,000
By Purchase of Drugs 15,000
To Receipts from Dispensing 50,000

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By Salaries 10,000
To Miscellaneous Receipts 500
By Rent and Taxes 7,500
By Conveyance 5,000
By Stationery 2,500
By Drawings 60,000
By Balance C/d 33,000
Total 1,55,500 Total 1,55,500

Adjustments

Amounts still receivable on account of visit fees and dispending are Rs-5,000/- and Rs 3,000/-
respectively. Salary to Assistant yet to be paid Rs- 4,000/-. 50% of conveance is for domestic
purpose. Furniture and Equipments to be depreciated by 10% and 5% respectively.Stock of
Drugs in hand Rs. 4,000 and amount payable for their purchases is Rs. 1,000 .

Prepare Receipts And Expenditure A/c of Dr. Manish .

Problem No 6 ) Following is the Balance sheet of Doctor Trupti as on 31st March 2013 and
Receipts and Payment account for the year ended 31st March 2014.

Balance Sheet as on 31/03/2013

Liabilities Rs Assets Rs

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 Dhananjayrao Gadgil College of Commerce , Satara

Capital Account 81,000 Cash in Hand 4,000

Outstanding Expenses 3,000 Cash at Bank 12,000
Reserve for Outstanding 8,000 Fees due but not Received 8,000
Rees Equipments 20,000
Furniture 8,000
Motor Car 40,000

Total 92,000 Total 92,000

Receipts and Payments account for the year ended 31-03-2014

Receipts Rs Payments Rs
Cash Balance 4,000 Office expenses 15,000

Bank Balance 12,000 Motor car expenses 14,000

Fees Received 60,000 Travelling 8,000

Cash in hand 9,000

Cash at Bank 30,000

Total 76,000 Total 76,000

Adjustments

Fees outstanding as on 31-03-2014 Rs- 10,000 .Depreciate motor car by 20% ,Furniture at 10%
and equipments are valued at Rs 17,000

Prepare Receipt and Expenditure Account for the year ended 31-03-2014 .

Problem No. 7 ) Dr. Venkatesh gives the following information to you .

Balance sheet as on 31-3-2014

Liabilities Rs Assets Rs.

Capital 6,90,000 Cash Bal. 10,000

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O/s Salary 50,000 Bank Bal. 30,000

Reserve for O/s Fees 60,000 O/s Fees 60,000
Motar Car 4,00,000
Equipment 2,00,000
Furnitures 1,00,000
Total 8,00,000 Total 8,00,000

Receipts and payments Account

For the year ended 31-3-2015

Receipts Rs. Payments Rs.

To Bal B/d By Motar Car Expenses 1,40,000
Cash 10,000 By Medicines 2,00,000
Bank 30,000 By Salary to Staff 2,40,000
To Medical Fees 6,00,000 By Rent 1,20,000
To Consultancy fees 1,00,000 By Stationary 5,000
To Visit Fees 50,000 By Electricity 12,000
To Miscellaneous Receipts 10,000 By Journals 3,000
By Drawings 50,000
By Bal C/d
Cash 25,000
Bank 5,000
Total 8,00,000 Total 8,00,000

Other information

1) Fees outstanding in the last year are received fully during the current year .

2) Fees outstanding for the current year are Rs. 1,00,000 .

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3) DepriciateMotar Car by 20 % , Furniture by 10 % and Equipment by 5 % .

Prepare Receipt and Expenditure Account for the year ended 31-3-2015 and Balance sheet as on
31-3-2015 .

Problem 8 ) Mr. Pratik is a Chartered Accountant following is the Receipt and Payment
Account for the year ended 31-3-2012 .

Receipt and Payment Account

Year ended 31-3-2014

Particulars Rs. Particulars Rs.

To Balance 1,35,000 By Office Expenses 25,000
To Audit Fees 1,00,000 By Motar Car Expenses 15,000
To Consultations 15,000 By Printing Expenses 25,000
To Fees 1,00,000 By Rent 49,000
To Other Fees 5,000 By Salary to Assistant 30,000
By Book 50,000
By Purchase of Equipment (1-7-2013) 1,00,000
By Balance 61,000

Total 3,55,000 Total 3,55,000

Adjustments

1) Audit Fees amounting to Rs. 7,500 are still receivable .

2) Salary to assistant Rs. 7,000 outstanding .

3) Rent is paid in advance Rs. 6,000 .

4) Depriciate Books 10% and Equipment at 15 % p.a.

Prepare Receipts and Expenditure Account of Mr. Pratik for the year ended 31-3-2014 .

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Problem 09 ) Following is the Trial Balance of Nikhil , a Chartered Accountant , Practicing in

Jaysingpur .

Particulars Debit (Rs.) Particulars Credit (Rs.)

Outstanding Fees 96,000 Capital 2,20,000
Salaries 3,70,000 Provision for 96,000
Rent 1,50,000 outstanding Fees
Office Expenses 1,10,000 Fees received 12,56,000
Drawings 3,40,000 Clients deposits 60,000
Furniture 1,00,000
Books 80,000
Stock of Stationary (1/4/2012) 44,000
Computer 92,000
Bank Balance 1,80,000
Cash Balance 20,000
Payments on behalf of clients 50,000
(from deposits )
Total 16,32,000 Total 1632000

Adjustments

1. Office expenses includes Stationary Rs. 60,000 . Stock of Stationary on 31/3/2013 Rs. 25,000

2. Outstanding Fees for the year Rs. 1,14,000 .

3. Depriciate Furniture by 10% ,Books by 25% and Computer by 40 % .

You are required to prepare

a) Receipts and Expenditure Account for the year ended on 31/3/2013 .

b) Balance Sheet as on 31/3/2013 .

Problem No.10 ) Following is the Receipts and Expenditure Account of Mr. Guru a Charted
Accountant for the year 2012-2013 .

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 Dhananjayrao Gadgil College of Commerce , Satara

Receipts and Expenditure Account

For the year ended on 31st March 2013

Expenditure Rs. Receipts Rs.

To Motar Car Expenses 50,000 By Reserve for outstanding 75,000
To Office Expenses 190000 1,50,000 fees
Add outstanding for current year 40000 By fees received 615000
Less outstanding for last year 80000 Add Advances fees in last
To Maintenance of Computers 25,000 year 60000
To Stationery 8,000 Outstanding for current
To Postage and Internet Charges 25,000 year 35000
To Electricity charges 60,000 Less Advance fees in
To Journals and periodicals 15,000 current year 15000
To Travelling Expenses 98,000 Outstanding in last
To Sundry Expenses 16,000 year 75000 6,20,000
To Depriciation on 1,03,000
Motar Car 35000 By Miscellaneous receipts 35,000
Computers 56000
Furniture 12000
To Provision for outstanding fees 35,000
To Surplus 1,45,000

Total 7,30,000 Total 7,30,000

Other information

1. Drawings during the year Rs. 1,00,000.

2. His Assets and Liabilities were as under

Particulars 31/3/2012 (Rs.) 31/3/2013 (Rs.)

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Cash Balance 5,000 28,000

Bank Balance 1,10,000 1,50,000

Motar Car 3,50,000

Computers 1,40,000

Furniture 1,20,000

You are asked to prepare

a) Balance Sheet as on 31/3/2012.

b) Balance Sheet as on 31/3/2013.

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