CA Foundation Questions – Final Account

  1. The balance sheet of Son 1st April, 2021 was as follows:
    Particulars Amount (Rs). Particulars Amount (Rs.)
    Trade Payables 6,50,000 Furniture and Fixtures 6,50,000
    Expenses Payable 75,000 Vehicle 2,75,000
    Capital 22,00,000 Trade Receivable 11,00,000
    Cash at Bank 4, 75,000
    Inventories 4,25,000
    29,25,000 29,25,000

    During 2021-22, his profit and Loss Account revealed a net profit of Rs. 6,70,000. This was after allowing for the following :
    (i) Commission paid to selling agent Rs. 65,000
    (ii) Discount received from creditors Rs. 75;000
    (iii) Purchased a vehicle of Rs. 50,000 on 31st March, 2022
    (iv) Depreciation on Furniture and Fixtures@ 10% and on Vehicle@ 20%
    (v) A provision for doubtful debts@ 3% of the trade receivables as at 31st March, 2022
    But while preparing the Profit and Loss Account he had forgotten to provide for
    (1) prepaid expenses Rs. 15,000 and
    (2) outstanding commission Rs. 35,000.

    His current assets and liabilities on 31st March, 2022 were: Inventories Rs.6,50,000. Trade Receivables Rs.13,00,000 (before provision for doubtful debts), cash at Bank Rs.5,50,000 and Trade Payable Rs.1,46,000.

    During the year he introduced further capital of Rs.3,00,000 into the business. You are required to prepare the balance sheet as at March 31, 2022.

    [2022 December 10 Marks]

  2. The following is the trial balance of Mr. B for the year ended 31st March, 2021:
    Particulars Dr. Particulars Cr.
    Opening Stock: Sundry Creditors 1,75,000
    Raw Material 5,25,000 Purchase Return 17,500
    Finished Goods 2,62,500 Capital 3,50,000
    Purchase of Raw Material 17,50,000 Bills Payable 84,000
    Land & Building 3,50,000 Long Term Loan 7,00,000
    Loose Tools 1,05,000 Provision for bad and doubtful debts 7,000
    Plant and Machinery 1,05,000 Sales 29,75,000
    Investments 87,500 Bank Overdraft 80,500
    Cash in Hand 70,000
    Cash at Bank 17,500
    Furniture and Fixtures 52,500
    Bills Receivables 52,500
    Sundry Debtors 1,40,000
    Drawings 70,000
    Salaries 70,000
    Coal and Fuel 52,500
    Factory rent and rates 70,000
    General Expenses 14,000
    Advertisement 17,500
    Sales Return 35,000
    Bad Debts 14,000
    Direct Wages (Factory) 2,80,000
    Power 1,05,000
    Interest paid 24,500
    Discount allowed 10,500
    Carriage inwards 52,500
    Carriage outwards 24,500
    Commission paid 17,500
    Dividend paid 14,000
    43,89,000 43,89,000

    Additional Information:
    (i) Stock of finished goods at the end of the year was Rs.3,50,000.
    (ii) A provision for doubtful debts is to be created@ 5% on Sundry Debtors. Provide Depreciation on building 3,500 and Machinery 10,500.
    (iii) Accrued commission is Rs.43,750. Interest has accrued on investment 52,500.
    (iv) Salary Outstanding is Rs.7,000 and Prepaid Interest is Rs. 5,250.
    You are required to prepare Manufacturing, Trading and Profit & loss account for the year ended 31•t March, 2021 and Balance Sheet as at that date.

    [2022 December 10 Marks]

  3. On 31st March, 2021 the Trial Balance of Mr: Black was as follows:
    Particulars Debit Particulars Credit (Rs.)
    Stock on 1/4/2020 : Sundry Creditors 1,50,000
    Raw Materials 2,10,000 Bills Payables 75,000
    Work-in-Progress 95,000 Sale of scrap 25,000
    Finished Goods 1,55,000 Commission received 4,500
    Sundry Debtors 2,40,000 Provision for doubtful debts 16,500
    Carriage on Purchase 15,000 Capital account 10,00,000
    Bills Receivables 1,50,000 Sales 16,72,000
    Wages 1,30,000 Bank Overdraft 85,000
    Salaries 1,00,000
    Telephone and Postage 10,000
    Repairs to office furniture 3,500
    Cash ·at Bank 1,70,000
    Office Furniture 1,00,000
    Repairs  to  Plant 11,000
    Purchases 8,50,000
    Plant and Machinery 7,00,000
    Rent 60,000
    Lighting 13,500
    General Expenses 15,000
    30,28,000 30,28,000

    The following additional information is available: Stocks on 31st March, 2021 were:
    Raw materials 1,62,000
    Finished goods 1,81,000
    Work-in-progress 78,000
    Salaries and wages unpaid for the year ended 31st March, 2021 were respectively, 9,000 and 20,000. Machinery is to be depreciated by 10% and office furniture by 7.5%. A provision for doubtful debts is to be maintained @ 1% of sales. Rent is to be charged as to 3/4 to factory and 1/4 to office. Lighting is to be charged as to 2/3 to factory and 1/3 to office.

    Prepare the Manufacturing Account, Trading Account and Profit and Loss Account for the year ended on 31st March, 2021.

    [2021 December 15 Marks]

  4. Karuna decided to start business of fashion garments under the name  of M/s. Designer Wear on pt April, 2020. She had a saving of about Rs.10,00,000. She invested 3,00,000 out. of her sa ings and borrowed equal amount from Bank. She purchased a commercial space for 5,00,000 and further spent 1,00,000 on its renovation to make it
    ready for busine s.Loan and interest repaid by her in the first year are as follows: 30th June, 2020 15,000 principal+ 9,000 interest
    30th September, 2020 – f 15,000 principal+ 8,550 interest•..• 31st December, 2020
    31st March, 2021

    15,000 principal+. 8,100 interest

    ” f 15,000 principal+ 7,650 interest.

    In view of further capital requirement, .she transferred 2,00,000 from her saving bank account to the bank account of the business. She paid security deposit of 7,000 for telephone .connection. Furniture of 10,000 was purchas.ed. All payments were made by cheque and all
    receipts in cash were deposited in the bank.

    At the end of the year, her business showed the following results:

    Particulars Amount Particulars Amount
    Total Sales 20,00,000 Total Purchase 17,00,000
    Electricity Expenses paid 40,000 Telephone Charges 50,000
    Cartage Outwards 60,000 Travelling Expenses 45,000
    Entertainment Expenses 5,000 Maintenance Expenses 25,000
    Misc. Expenses 15,000 Electricity Expenses 20,000
    Payable