OMTEX AD 2

Miss Meena and Miss Reena are in partnership sharing profits and losses in the ratio of 3:2. From the following trial balance and adjustments, you are required to prepare Trading Account, Profit and Loss Account for the year ended 31st March, 2013 and Balance Sheet as on that date.

Partnership Final Accounts: Miss Meena and Miss Reena
Q7. Miss Meena and Miss Reena are in partnership sharing profits and losses in the ratio of 3:2.

From the following trial balance and adjustments, you are required to prepare Trading Account, Profit and Loss Account for the year ended 31st March, 2013 and Balance Sheet as on that date.

Trial Balance as on 31.03.2013

Particulars Amount (Rs.) Particulars Amount (Rs.)
Building 400000 Capital Accounts
Plant and machinery 120000 Meena 300000
Purchases 650000 Reena 200000
Carriage 7000 Sales 814000
Opening Stock 90000 Sundry creditors 180000
Wages 35000 Bank overdraft 20000
Sundry debtors 150000
Salaries 28000
Postage and telegram 4000
Insurance 5000
Bad debts 3000
Rent 4000
Discount 3000
Drawings
Meena 10000
Reena 5000
Total 1514000 Total 1514000

Adjustments:

1. Stock on hand on 31st March, 2013 was valued at Rs. 1,10,000.
2. Depreciate plant and machinery at 10% p.a.
3. Create reserve for doubtful debts at 5% on sundry debtors.
4. Salaries include Rs. 2500 as advance to workers.
5. Partners are allowed interest at 5% p.a. on their capitals.

Solution:

Trading A/c for the year ended 31st March, 2013

Dr. Cr.
Particulars Rs. Rs. Particulars Rs. Rs.
To Opening Stock 90,000 By Sales 8,14,000
To Purchases 6,50,000 By Closing Stock 1,10,000
To Carriage 7,000
To Wages 35,000
To Gross Profit c/d 142000
9,24,000 9,24,000

Profit and Loss A/c for the year ended 31st March, 2013

Dr. Cr.
Particulars Rs. Rs. Particulars Rs. Rs.
To Salaries
(-) Advances		 28,000
(-)2,500		 25,500 By Gross Profit C/d 142000
To Postage and Telegram 4,000
To Insurance 5,000
To Bad debts
(+) F.B.D.
(+) N.R.D.D.
(-) O.R.D.D.		 3,000
-
7,500
-		 10,500
To Rent 4,000
To Discount 3,000
To Depreciation on Plant and Machinery 12,000
To Interest on Capital
Meena [300000 × 5%] 15,000
Reena [200000 × 5%] 10,000 25,000
To Net Profit Transferred to Partners Capital A/c
Meena 31,800
Renna 21,200 53000
142000 142000

Partners' Capital A/c

Dr. Cr.
Particulars Meena (Rs.) Reena (Rs.) Particulars Meena (Rs.) Reena (Rs.)
To Drawings 10,000 5,000 By Balance b/d 3,00,000 2,00,000
To Balance c/d 3,36,800 2,26,200 By Interest on Capital 15,000 10,000
By Net Profit b/d 31,800 21,200
3,46,800 2,31,200 346800 231200

Balance Sheet as on 31 March, 2013

Liability Rs. Rs. Assets Rs. Rs.
Capital A/c Building 4,00,000
Meena 3,36,800 Plant and Machinery 1,20,000
Reena 2,26,200 (-) Depreciation @ 10% -12,000 1,08,000
Sundry Creditors 1,80,000 Sundry Debtors 1,50,000
Bank Over Draft 20,000 (-) N.R.D.D.@ 5% (-)7,500 1,42,500
Closing Stock 1,10,000
Advance Salaries paid to workers 2,500
Total 7,63,000 Total 7,63,000
Labels: