Prepared by – Manoj Sir (9818606913)

PROFIT & Loss Account and Balance Sheet

Tally Prime

What is Profit & Loss Account and Balance Sheet?

Profit and Loss statement (P&L), is a financial report that shows a company's revenues and expenses
over a given period of time, Company time period between 1st April for Present Year upto 31st March for
next Year.

Balance Sheet is a statement of the financial position of a business which states the assets, liabilities,
and owners' Capital at a particular point in time. In other words, the balance sheet illustrates business's
net worth.

• Major Key Points

o How to create Ledger Entry and check P&L A/c and Balance Sheet
o How to Delete and Modify in Ledger
o How to check Trial Balance
o Short cut keys for Modify Ledger / Delete Ledger or Details Ledger

How to do P&L Question in Tally just follows below rules

 Create New company

 Set features Maintain Inventory – ‘No’

 Gateway of Tally→ Create → Ledger

Insert all Ledgers which are given in question with Correct Group and Amount

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Prepared by – Manoj Sir (9818606913)

 Gateway of Tally→ Profit & Loss A/c → Press (Alt + F2) changer period in 1 year.
 Gateway of Tally→ Balance sheet → Press (Alt + F2) changer period in 1 year

Note (Remember these points otherwise P&L or Balance sheet Invalid)

▪ Purchase Return or Return outward is same → Purchase A/c →Cr.

▪ Sales Return or Return Inward is same → Sales A/c →Dr.

▪ Drawing or Proprietor Drawing is same → Capital A/c →Dr.

▪ Closing stock Entry must be define with opening stock, Press Esc Key for Ledger screen
and from Gateway of Tally press Enter on Alter then Enter on Ledger Select opening
Stock then Press 5 times enter (insert closing date e.g. 31-3-2021) and Fill Closing Stock
amount (e.g. 7000) press 4 times enter for save

If Some Mistake in amount or Group Maintain, then

Gateway of Tally → Charts of Accounts → Ledger → Press Alt+H Key (for Change View) – Enter
on Multi Alter → All Items,

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Prepared by – Manoj Sir (9818606913)

Enter Correct Amount or Group in wrong entry then. Press (ctrl + A) to save or accept changes
you change in ledger alter otherwise entry Not Save or Change.

Practical Example
Prepare the Trading & Profit and Loss A/C or Balance sheet as on 31stMar2020.

Particular Rs. Particular Rs.

Capital 3,600 Salaries 600
Machinery 700 General expenses 200
Sales 8,200 Rent 500
Purchase 4,000 Return outward 50
Sales return 100 Debtor 3,000
Stock 1-4-2019 1,000 Cash 400
Drawing 400 Carriage on sales 200
Wages 1,000 Advertisement 200
Carriage inward 50 Creditor 500
Closing Stock 2000

(Ans. G.P → 4,100, N.P → 2,400, Balance Sheet →6,100)

Practice Question

Q –1 Prepare the Trading A/c for the transaction given below calculate Gross Profit.

Opening stock 2,000 Purchase return 500

Purchase 4,500 Closing stock 1200
Sales Return 1,000 Grease 400
Sales 9,000 Dock Charges 300

Ans. (G.P →Rs. 2,500)

Q-2 Prepare the Trading A/c for the transaction given below calculate Gross Profit.
Opening stock 9,000 Carriage on Purchase 3,000
Closing Stock 18,000 Factory rent 9,000
Purchase 10,00,000 Sales 7,00,000
Manufacture Exp. 10,000

Ans. (Gross .Loss →Rs. 3, 13,000)

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Prepared by – Manoj Sir (9818606913)

Q-3 Prepare Trading & Profit and Loss A/c or Balance sheet.

Debit Balance
Machinery 2,500 Rent 450
Debtor 2,700 Carriage Outward 200
Drawing 900 Carriage 150
Purchase 9,500
Credit Balance
Wages 5,000 Capital A/c 10,000
Bank 1,500 Creditor 1,400
Stock 1, April 2,000 Sales 14,500
Furniture 1,000 Stock 31,March 300

(Ans. G.L → 1,850, N.L → 2,500, Balance Sheet →10,500)

Q-4 Prepare Trading & Profit and Loss A/c or Balance Sheet.
620
Sales 92,000 Postage & Telegram
Purchase 68,300 Sundry Expenses 900
Return inward 1,300 Bad debts 400
Return outward 2,200 Debtor 22,000
Stock opening 17,600 Creditor 12,800
Carriage inward 2,400 Loan (Cr) 5,000
Rent, rates & Taxes 2,200 Capital 52,500
Discount 3,750 Drawing 1,910
Printing 720 Business Premises 39,000
Insurance 500 Office furniture 1,500
Travelling expenses 1,400 Closing Stock 24,000

(Ans. G.P → 28,600, N.P → 18,110, Balance Sheet →86,500)

Q –5 from the following data prepare Final A/c of Mr Karan Verma at the year 2017
Salary Rs 5,400, insurance Rs 2,500, cash Rs 400, Purchase Rs84170, Rent (Cr.) 3,150
Drawing Rs 2,100, B.P Rs 3,900, Debtor Rs 38,080, Stock Opening Rs 29,500, Bank overdraft Rs
9,700, Carriage Rs 2,200, Creditor Rs 4,200, Trade Exp Rs 4,900, Sales Return Rs 4,700, Machinery
Rs 12,000, Wages Rs 45,000, Sales Rs 1, 47,200, Purchase Return Rs 3,900, Capital Rs 58,900,
Closing Stock Rs 36,200
(Ans. G.P → 21,730, N.P → 12,080, Balance Sheet →86,680)

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Prepared by – Manoj Sir (9818606913)

Q-6 Prepare Trading & Profit and Loss A/c or Balance Sheet.
Amount (Dr.) Amount (Cr.)
Debtor & Creditor 15,000 70,000
Opening Stock 50,000
Land & building 1,57,000
Capital & Drawing 20,000 2,50,000
Rent Received & Office Exp 25,000 6,000
Cash in Hand 16,000
Cash at Bank 40,000
Wages 30,000
B/P & B/R 20,000 40,000
Bed debts 25,000
Interest 2,000
Repair & Renewal 3,000
Sales & Purchase 1,00,000 1,70,000
Furniture & Fixture 15,000
Depreciation 10,000
Rates & Taxes 8,000
Closing Stock 1,00,000

(Ans. G.P → 90,000, N.P → 23,000, Balance Sheet →3, 63,000)

Q-7 Prepare the Trading & Profit and Loss A/C or Balance sheet as on 31st Mar 2020

Particular Rs. Particular Rs.

Opening Stock 2,40,000 Dock charges 4500
Purchases 4,56,000 Return inward 20,000
Sales 24,50,000 Creditor 86,500
Rent 1,20,000 Bed Debts Received 12,000
Outstanding income 45,600 Cash 57,000
Petty-cash 24,000 Return outward 43,000
Carriage inward 7,000 HDFC Bank 3,50,000
Investment 4,50,000 Loan (Dr.) 24,500
Furniture 2,30,000 Bills Payable 49,000
Bills Receivable 1,25,000 Drawing 16,900
Capital 8,40,000 Reserve fund 30,000
Commission 70,000 Electric bill 67,000

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Prepared by – Manoj Sir (9818606913)

Salary 11,45,000 Bonus 37,000

Transport charges 21,000 Closing Stock 1,20,000

(Ans. G.P →18,85,500, N.P → 4,37,500, Balance Sheet →14,26,100)

(Test Question)

Q-8 Prepare the Trading & Profit and Loss A/C or Balance sheet as on 31stMar 2020

Opening Stock 45,300

Purchases 1,45,000
Gas & Oil 800
Commission Received 56,000
Furniture 71,300
Interest Received 31,200
Custom Duty of Import 5,000
Return Outward 4,210
Rent Paid 80,000
Plant & Machinery 1,12,000
Audit charges 17,000
Packaging charges 1,900
Motive power 8,000
Sales 3,45,000
Export Duty 6,250
Bank charges 700
Royalty 19,200
Sales Return 49,000
Manufacture Expenses 14,500
Entertainment Expenses 4,500
Law Fees 7,600
Freight 1,700

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Prepared by – Manoj Sir (9818606913)

Bad Debts 2,340

Interest on Drawing 9,000
Capital 8,20,100
Bank 6,00,000
Loan (Cr.) 3,00,000
Drawing 75,000
Bills Receivable 25,210
Motor Vehicle 90,000
Cash 1,50,000
Prepaid Expenses 40,000
Creditor 20,700
Debtors 32,810
Bank Overdraft 18,900
Closing Stock 82,300

(Ans. G.P → 1, 43,010 / N.P →1,18,920, Balance Sheet →12,03,620)

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