Chapter - 16 (Question - 7 Preparation of final accounts with adjustment of sole proprietorship)

 

Question - 07

From the following balance and additional information prepare final accounts of M/s. City look Bilaspur for the year ending 31st Dec., 2000.

Trial Balance

Furniture Rs. 4,000                                           Capital Rs. 25,000

B/R Rs. 2,000                                                    Reserves for Bad debts Rs. 1,600

Salaries Rs. 2,200                                             Creditors Rs. 9,000

Bad debts Rs. 1,000                                          Commission Rs. 400

Loss by fire Rs. 500                                          Rent Rs. 1,800

Debtors Rs. 4,500                                             Gross Profit Rs. 15,500.

Postage Rs. 100

Building Rs. 39,000 

Adjustments :

1. Outstanding salaries Rs. 200.
2. Accrued Commission Rs. 100, Unaccrued rent Rs. 600.
3. Depreciate funiture at Rs. 10%.
4. Written off a further bad debts Rs. 100 and make a provision for doubtful of Rs. 800.