OMTEX CLASSES: Mahendra keeps his books by single entry system.

Mahendra keeps his books by single entry system.

Textual Problem No. 4
4. Mahendra keeps his books by Single Entry System. His position on 1stApril 2012, was as follows: Cash in Hand Rs. 7,900, cash at bank Rs. 20,000, Debtors Rs. 18,000, Stock Rs. 29,000, Motor Car Rs. 5,000, Bank Loan Rs. 18,000 and outstanding expenses Rs. 2700. 

On 1stOctober, 2012 Mahendra introduced Rs. 10,000 as further capital in the business and withdrew on the same date Rs. 7000 out of which he spent Rs. 5000 on the purchase of a Machinery for the business. 

On 31stMarch 2013 his position was follows: Cash in Hand Rs. 7,600, Cash at Bank Rs. 22,000, Stock Rs. 30,000, Debtors Rs. 25700, Furniture Rs. 6,000, Creditors Rs. 25,200 and prepaid expenses Rs. 200. 

Prepare a statement showing the Profit or Loss made by him during the year ended 31stMarch, 2013 and Opening the Closing statement of affairs. Consider the following adjustments also. 

(1) Depreciate Motor car and Furniture @ 10% p.a. Additions to furniture was made on 1stOctober, 2012. 
(2) Provide Rs. 1200 for Bad debts and provide 5% R.D.D.
(3) Goods taken for personal use by Mahendra amounting to Rs. 1500. 
(4) Provide Interest on capital @ 10% p.a.