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Let’s take a set of transactions and prepare all the requisite information asked.
Following are the transactions for the period April 20×1 to March 20×2 in the books of
Michael Traders
Michael started business with cash 600,000, cash at Bank of America 700,000, furniture
1-Apr
200,000.
25-Apr Purchased goods from ABC Ltd worth 800,000 @10% trade discount.
28-Feb Office was taken on rent in the month of Feb. Office rent paid in cash 50,000.
Employees were hired in the month of Feb. Paid salary by cheque 30,000 & cash 30,000 for
28-Feb
the month of Feb 20×2.
31-Mar Paid salary in cash 30,000 for the month of March 20×2.
(i) Journalize the above transactions and post them in Ledgers and prepare a Trial
Balance.
(ii) Prepare Trading A/c, Profit & Loss A/c and Balance Sheet taking into consideration:
3. Depreciation@10% to be charged on Furniture & Fixtures and @15% on Plant & Machinery.