From the following Trial Balance of M/s Vishal and Vaibhav, you are required to prepare Trading and Profit and Loss Account,

Final Accounts Preparation

Prepare the Trading and Profit & Loss Account for M/s Vishal and Vaibhav for the year ended 31st March, 2013, and the Balance Sheet as on that date, using the following Trial Balance and Adjustments.

Trial Balance as on 31st March, 2013

Debit Balances	Amount (₹)	Credit Balances	Amount (₹)
Salary and Wages	17,000	Sales	110,000
Postage and Telegram	1,750	Sundry Creditors	72,700
Opening Stock	23,500	Bills Payable	40,000
Plant and Machinery	70,000	10% Bank Loan (from 01/10/2012)	60,000
Import Duty	3,100	Outstanding Audit Fees	5,900
Purchases	98,500	Capital A/c: Vishal	45,000
Sundry Debtors	45,800	Capital A/c: Vaibhav	45,000
Bills Receivable	16,700
Carriage Outward	1,800
Wages and Salary	14,000
Printing and Stationery	4,600
Cash in hand	1,850
Lease hold premises	80,000
Total Debits	378,600	Total Credits	378,600

Adjustments

1. Closing stock was valued at ₹30,000.
2. Unused postal stamps of ₹250 and stationery of ₹400.
3. Leasehold property is for 10 years, effective from 1st October, 2012.
4. Depreciate Plant and Machinery at 10% p.a.
5. Mr. Rajan, a customer, became insolvent, and his debt of ₹1,500 is irrecoverable.

Solution: In the books of M/s Vishal and Vaibhav

Trading Account

For the year ended 31st March, 2013

Dr. (Particulars)

To Opening Stock	23,500
To Purchases	98,500
To Import Duty	3,100
To Wages and Salaries	14,000
To Gross Profit c/d	900
Total	140,000

Cr. (Particulars)

By Sales	110,000
By Closing Stock	30,000
Total	140,000

Profit & Loss Account

For the year ended 31st March, 2013

Dr. (Particulars)

To Salary and Wages	17,000
To Postage and Telegram	1,750
Less: Unused Stamps	(250)
	1,500
To Carriage Outward	1,800
To Printing and Stationery	4,600
Less: Unused Stationery	(400)
	4,200
To Depreciation: Leasehold	4,000
To Depreciation: Plant & Machinery	7,000
To Bad Debts (Rajan)	1,500
To Interest on Bank Loan	3,000
Total	40,000

Cr. (Particulars)

By Gross Profit b/d	900
By Net Loss (Transferred to Capital)
Vishal	19,550
Vaibhav	19,550
	39,100
Total	40,000

Balance Sheet

As on 31st March, 2013

Liabilities

Capital Accounts
Vishal	45,000
Less: Net Loss	(19,550)
	25,450
Vaibhav	45,000
Less: Net Loss	(19,550)
	50,900
Loans & Liabilities
10% Bank Loan	60,000
Add: Outstanding Interest	3,000
	63,000
Sundry Creditors	72,700
Bills Payable	40,000
Outstanding Audit Fees	5,900
Total Liabilities	232,500

Assets

Fixed Assets
Plant and Machinery	70,000
Less: Depreciation	(7,000)
	63,000
Leasehold Premises	80,000
Less: Written Off	(4,000)
	76,000
Current Assets
Closing Stock	30,000
Sundry Debtors	45,800
Less: Bad Debts	(1,500)
	44,300
Bills Receivable	16,700
Cash in Hand	1,850
Unused Stationery	400
Unused Postal Stamps	250
Total Assets	232,500