OMTEX CLASSES: Mr. Suryakant maintains books on single entry and who gives you the following information. (September 2008)

Mr. Suryakant maintains books on single entry and who gives you the following information. (September 2008)


Particulars
31-3-2013
31-3-2014
Cash in hand
Cash at bank
Stock
Sundry debtors
Investments
Furniture
Machinery
Sundry creditors
Outstanding expenses
500
2500
20000
25000
20000
10000
25000
10000
3000
2000
5000
30000
40000
20000
25000
40000
10000
2000

  1. Mr. Suryakant introduced further capital of Rs. 20000 on 1st July, 2013 and had withdrawn Rs. 10,000 during the year.
  2. Interest on capital is allowed at 10% p.a.
  3. Additions to furniture and machinery were made on 1st October, 2013. Write of deprecation on furniture and machinery at 10% p.a.
  4. Create reserve for doubtful debts at 5% on debtors.

Solution: In the books of Mr. Suryakant

Statement of Affairs as on 31.03.2013 and 31.03.2014

Liability
31.3.2013
31.3.2014
Assets
31.03.2013
31.03.2014
Capital
(Bal. Fig.)
90000
150000
Cash in hand
500
2000



Cash at Bank
2500
5000



Stock
20000
30000
Sundry Creditors
10000
10000
Sundry Debtors
25000
40000
Outstanding expenses
3000
2000
Investments
20000
20000



Furniture
10000
25000



Machinery
25000
40000

103000
162000

103000
162000

Statement of Profit or Loss for the year ended 31.03.2014


Particulars
Rs.
Rs.
Capital at the end of the year

150000
Add: Drawings:


Amount withdrawn for Private Expenses

10000


160000
Less: Additional Capital Introduced


Further Capital Introduced

-20000


140000
Less: Capital at the beginning of the year

-90000
Trading Profit

50000
Less: Depreciation:


On Furniture
On Opening Balance:
10000 × 10%
1000

On Additional Furniture
15000 × 10% × 6 months
750

On Machinery
On Opening Balance:
25000 × 10%
2500

On Additional Machinery
15000 × 10% × 6 months
750
-5000


45000
Less: R.D.D. @ 5% On Debtors
40000 × 5%

-2000


43000
Less: Interest on Capital
On opening Balance:
90000 × 10%
9000

On Additional Capital
20000 × 10% × 9 months
1500
-10500
Net Profit

32500