PROJECT WORK 1 SUB: ACCOUNTS 02/09/2020

Topic: Journal, Ledger, Trial Balance and Financial Statement.

Arpan who wanted to become an entrepreneur , decided to start business of fashion garments
under the name of M/s Designer Wear from 1st April, 2019. He had savings of `10,00,000. He
invested `3,00,000 out of his savings and borrowed equal amount from State Bank of India. He
purchased a commercial space of 500 sq. feet for `5,00,000. The space so purchased was suitably
renovated to make it ready as showroom. He purchased furniture and fixtures for `75,000. Total
amount of bank loan is to be repaid in 20 quarterly instalments beginning 30th june, 2019.
Annual rate of interest is 12% p.a
Repayment Schedule of Bank Loan in the first year is as follows:
Due Date Principal (`) Interest (`) Instalment (`)
June 30,2019 15,000 9,000 24,000
September30, 2019 15,000 8,550 23,550
December 31,2019 15,000 8,100 23,100
March 31,2020 15,000 7,650 22,650
He started business on 1st April, 2019.In view of further capital requirement, he further
deposited ` 2,00,000 in the bank. He paid Security Deposits of `5,000 for the electricity
connection with WBSEDC Ltd and `2,000 to BSNL for telephone connection. Furniture for
`10,000 was purchased further.
All payments were to be made by cheque. All the receipts were in cash and to be deposited in the
bank in the morning of next day.
At the end of the year, his results showed the following: (`)
Total Sales 20,00,000
Total Purchases 1 7,00,000
Electricity Expenses 40,000
Telephone Charges 50,000
Cartage Outwards 60,000
Travelling Expenses 45,000
Business Promotion (Restaurant Bill) Expenses 5,000
Maintenance Expenses 25,000
Miscellaneous Expenses 15,000
Electricity Expenses Payable 20,000
He withdrew `5,000 by cheque each month for his personal expenses.

Bank Loan was serviced and instalments were paid regularly. There was a Closing
Stock at the end of the year 31st March, 2020 ` 5,50,000. The business decided to charge
depreciation @ 5% on Building and 10% on Furniture and Fixtures.

1. Journalise the above transactions in the books of M/s Designer Wear, post them into the
Ledger and prepare the Trial Balance.
2. Also, prepare its Trading Account, Profit and Loss Account and Balance Sheet as at 31st
March, 2020.

Follow the following guidelines:

Page No. Content

Cover Your name,Class, Roll No., Name of Subject, Title of the project
Page

1. Table of Content ( Index of the Project file)

2. Subject matter of the project:

3. Information/Data required

4 Objectives of the project.

5 to 11 ( Presentation of Project : your work of Journal, Ledger, Trial Balance……

may
change)

12. Conclusion

13. List of resources used for the project. ( Bibliography)

14. Acknowledgement.

Points to Note:
 Your project has to be hand written and must be clear and neat. Do it on the Science Project
paper( interleaf sheet) on the ruled side and not on the blank pages.
 Leave the same portion margin on the bottom, Top, Left and Right of the project page.
 The entire Project needs to have Page No.
 The outer and the first cover of the project should have the Title of the Project, along with
Student information including school name and the year.
 Use Black and Blue ink only for writing. Use Black for Headings.

OBJECTIVE OF THE PROJECT.

  Knowledge application in a real business like situation.
 Understanding the significance of book keeping and accounting
 Acquiring In depth knowledge on Accounts keeping, accounting process…
 Developing the writing skill.
 Learning to collect information and its presentation

Note: Complete the Journal, Ledger and Trial Balance. The final part of the Project, I.e Preparing Final
account , should be done once the chapter FINAL ACCOUNT is completed.