TEXTBOOK PROBLEM NO. 1
Note: Adjustments like introduction of additional capital, drawings made, depreciation on fixed assets, R.D.D. on debtors, etc are considered in this problem.
Mr. Mangesh is dealing in business. He maintains his accounting with single entry. The following are details of his business. (Textual Problem. No. 1)
Statement of Profit or Loss for the year ended 31st March, 2011
| Particulars | 1.4.2012 | 31.3.2013 |
|---|---|---|
| Land and Building | 40000 | 50000 |
| Machinery | 30000 | 40000 |
| Furniture | 10000 | 10000 |
| Debtors | 20000 | 40000 |
| Stock | 10000 | 25000 |
| Cash Balance | 5000 | 15000 |
| Bills Receivable | 5000 | 5000 |
| Creditors | 25000 | 25000 |
| Bank Overdraft | 5000 | - |
| Bank Balance | - | 10000 |
Mr. Mangesh introduced Rs. 10,000 as additional capital. He spent Rs. 45,000 for personal use. Depreciate Land and Building by Rs. 5000. Provide 5% R.D.D. on Debtors.
Prepare Opening Statement of affairs, Closing statement of affairs and the statement of profit or loss.
Solution:
