Mlustration S From the following Trial Balance and other information of Madhur ltd,, prepare final ‘accounts forthe year ending 31-12-19: Debit Credit™ Land & Building 100060 Paidup Capital (Shares of € 100 each) 1,200 Reserve Fund 20 Purchases & Sales 192,000 2.56000 Salaries 24700 18400 ry Expenses 16000 4x0 Profit & Loss Appropriation A/c ‘4500 Carriage 8400 ‘Stock (1-1-19) 60,000 Returns 12,800 16,400 Audit Fees 8400 Freight 8,200 Interim Dividend 7200 Bills Receivable & Payable (25,400 20,800 Calls in Arrears 8,000 Cashin Hand 10,400 Goodwill 24,800 ‘Scanned with CamSeannerFinancial Statements of Joint Stock Companies Debtors & Creditors Investment Furniture 6% Debentures Bank Overdraft Plant & Machinery Bad Debts Adjustments : 1. Closing stock 43,200. Depreciate furniture by 5% and machinery by 10%, 3. Provide reserve for doubtful debts at 5%. Write off preliminary expenses by 20%. 5. Transfer % 24,000 to Reserve Fund. 6, Provide for debenture interest for one year. Calution 28,200 35,600 34,000 28,000 80,000 10400 120,000 5,500 7A0500 740,500 ‘Scanned with CamSeannerSolution MADHURILtd. ‘STATEMENT OF PROFIT AND LOSS for the year ending 31st December 2019 sh. Particulars Note Year ending Noi No. 31-12-20197 1. | Revenue from Operations (Sales) 1 Il, | Otherincome 2 I. | Total Revenue (1+!) WV, | Expenses: Purchases 3 4492,200 Change in Inventories 4 16800 Employee Benefit Expense 5 13200 Finance Cost 6 4800 Depreciation and Amortisation Expense 7 13,400 Other Expenses 8 18510 Total Expenses 2.88910 v._ | Profit Before Tax (Ill- Ww) 59,090 ‘Scanned with CamSeanneeNotesto Accounts ear ending Tote re a saa 1. | revenue rom operations Sale of goods eee, Less Returns sam | 348200 2 | otherincome Interest a 3 | Purchase of Goods 192,000 Less: Returns 16400 175,600 cariage 3400 Freight 8200 4 | changein inventories Opening inventories p00 Closing inventories 43200 160 5 | EmployeeBenefitexpenses Woes 18400 salaries 24900 20 6 | Financecost Debenture interest a) 7 _| Depreciation and Amortsation Expenses Depreciation on Furniture 1400 Depreciation on Machinery 12000 Bo | otherExpenses Preliminary Expenses written off (20% of 16,000) 3200 Audit Fee ane ad Debt om Provision for Bad Debt aio e510 ‘Scanned with CamSeannerMaDHuRIted, BALANCE SHEET as at31 st December 2019 Particulars Note |Yearending No. | 31-12-2019 z Assets 1. Non-Current Assets 8) Property Plant and Equipment oe | 234600 ) Goodwit Se ©) Financial Assets ie 4) Other Non-current Assets a 9600 2. Current Assets a) Inventories aan b) Financial Assets i) Trade Receivables 2 ao Hi) Cashand Cash Equivalents B 30.400 Ii) Other Current Assets 4 3200 Total Assets 74990 Equity and Liabilities Equity (2) Share Capital 6 412,000 (b) Other Equity (Reserves and Surplus) 6 146910 abilities 1. Non-current Liabilities: Nit a) Financial Liabilities 1) Borrowings v 80000 2. Current Liabilities ir lites a) Financial Liabilities * ak 1) Trade Payables = saad Other Financial Liabilities = ) Provisions (Short Term) = Total Equity and Liabilities ‘Scanned with CamSeannerNotes to Accounts yearendng ote Particulars 31-3-2019% 9 [Property Plant and equipment Land and Building 4420000 anne, lantand Machinery Less: Depreciation ae | eee [Furniture zag, ess :Depreltion 1am |_25600 10 |rinanciat assets investment 11 |othernon-curentassets Preliminary expenses (16,000- 3,200 - 3,200) 12. | rade Reevabes Debtors 28,200 Less : Provisions 1410 26,790 ats necvabie aso | saa0 13 |eashandcath Equvatents cashinhand 10400 14 |otercurent assets relinnary Expenses tobe writen off within the next year 3am 15 |equityshare capital 1,200 Equity Shares of 100 each 120,000 Less: Calls In arrears 8,000 4,12,000 16 | Other Equity (Reserves and Surplus) Reserve Fund 32,000 Transfer during the year 24,000, 56,000 Surplus: Openingbalance sas |Add : Profit for the year 59,090 123,590, ‘Scanned with CamSeanner‘Financial stat 0! Statements of oint Stock Companies ia Less: Transfer to Res © Reserve Fung Interim Dividend a oe 7200 Borrowings 6% Debentures Trade Payables ‘Sundry Creditors Bp Other Financial Liabilities Interest accrued on debentures BoD Provisions (Short-term) cor ‘Working Note: Calculation of cor Gross Dividend = 7,200x100/85=8,470 cor = 8470x17.472%=1480 ‘Note :Preliminary expenses written off during the current year have been Included under ‘Other Expenses’ in the Notes to Accounts (this will appear in the Statement of Profit and Loss). This can also be written off against surplus in the Notes to Accounts in the absence of Securities Premium Reserve. The remainingamount tobe writen offin the futures 12,800. ‘Of this amount, & 3,200 (ie., 20% of 16,000) is shown under ‘Other Current Assets’ on the assumption that it would be written off within the next 12 months. The balance 9,600 (Le., 116,000 - 3,200 - 3,200 or 6056 of 16,000) is shown under ‘Other Non-current Assets’ on the assumption that it would be written off after 12 months, Some accountants take preliminary expenses written off under the head ‘Depreciation and Amortisation Expenses’ ke k BE ‘Scanned with CamSeanner