Final accounts problems

Final Accounts problems for MBA students

1. AFM UNIT I PROBLEMS

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Final Accounts Problems
Journal Entries.
1. Journalize the following transaction.
1. Purchase goods for cash 10,000
2. Purchase Machinery for cash 1,00,000
3. Sold goods for cash 8,000
4. Sold goods to Mr.Ramesh 3,000
5. Sold goods to Mr.Karthik 10,000
6. Paid rent to Antony 800
7. Salary paid 5,000
8. Paid lokesh salary of 3,000
9. Paid fright on goods purchased 200.
10. Paid fright on machinery purchased 600
11. Wages paid 1,000
12. Cash received from Mr.Arun 800
13. Cash received Rs.800 from arun as interest.
14. Received Rs. 7,000 from arun as loan at 5% interest.
2. Journalize the following transaction and prepare relevant ledger account. March 2012
1. Mr .A started business with Rs. 3,00,000 and purchased goods from Mr. X on
credit Rs. 52,000
5. Sold goods to Y on credit for Rs. 71,000
7. Paid to X after deducting discount @ 10%.
14. Withdraw from bank for personal use Rs. 31,000
17. Purchased goods and paid by cheque Rs. 72,500
19. Paid advertisement charges to Hindu Rs. 5,500
20. Received cheque from Ram due to the credit sales to him during the last
month Rs. 41,500
23. Mr. A brought into business further cash Rs. 77,000, Furniture worth Rs.
33,000 and stock worth Rs. 25,000.
25. Borrowed by K Rs. 65,000
27. Drawn from bank for office use Rs. 42,500.



3. Enter the following transaction in the journal and ledger of Mr. Hariprasad and also
prepare Trial Balance.
July 12

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1. commenced business with cash of Rs. 1,80,000.
3. Deposit into bank Rs. 55,000
4. Purchased goods for cash 22,000
5. Brought goods of Swaminathan 12,000
8. Cash sales 16,200
11. cash deposited into bank 23,000
14. Purchased Furniture for cash 4,000
16. sold goods to Vivek 12,700
17. Received cash from Vivek 12,446
17. Discount allowed him 254
18. paid Swaminathan cash 12,000
18. Discount allowed by him 240
20. wages paid 1,800
21. Sold goods for jagadeesan 35,000
22. paid cash for trade expenses 150
24. sold goods to Rajan 23,280
25. Received from Jagadeesan 21,000
25. Discount allowed by him 525
26. Paid Swaminathan cash` 24,000
28. sold goods for cash 9,000
29. Paid cash for stationary 180
30. Paid cash for miscellaneous expenses 150
31. Brought goods from Sridhar 17,870
31. Withdraw cash for Private Expenses 1,480.

Trial balance
4. prepare trial balance
Opening stock 10,600
Wages 2,200
Carriage 200
Commission(Dr) 300
Purchases 12,000
Return inwards 440
Trade expenses 580
Rent 200
Plant 2,600
Repairs to plant 460
Cash in hand 200
Cash at bank 1,000
Debtors 3,000
Income tax 500
Drawings 700
Return outwards 150
Sales 25,200
Discount received 400
Capital 7,000
Creditors 830
Loan (Cr) 1,400

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5. The following balances were extracted from the ledge of Ramakrishna Engineering
works on 31
st
March 1997. You are required to prepare a trial balance as on that date in
proper form.
Drawings 6,000 Salaries 9,500
Capital 24,000 Sales Returns 1,000
Sundry creditors 43,000 Purchase Returns 1,100
Bills payable 4,000 Travelling expenses 4,600
Sundry debtors 50,000 Commission paid 100
Bills receivable 5,200 Trading expenses 2,500
Loan from Karthik 10,000 Discount earned 4,000
Furniture & Fixtures 4,500 Rent 2,000
Opening stock 47,000 Bank overdraft 6,000
Cash in hand 900 Purchases 70,800
Cash at bank 12,500
Tax 3,500
Sales 1,28,000

6. Following are the ledger balances of Sri Rao. You are asked to prepare trial balance as on
31.12.2000

Opening stock 10,000
Salaries 5,000
Bills payable 5,000
Cash in hand 12,000
Bank overdraft 4,000
Debtors 15,000
Cash at bank 18,000
Sales 80,000
Wages 1,000
Prepaid insurance 2,500
Depreciation on plant 8,000
Capital 60,000
Creditors 10,000
Loan from Krishna 25,000
Discount allowed 700
Accrued interest payable 5,000
Purchases 30,000
Reserve for bad debts 1,200
Trade expenses 500
Outstanding salaries 2,000

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Plant & Machineries 90,000
Outstanding interest
On overdraft 500

Final accounts

7. From the following information prepare Trading Account.
Opening stock 1,00,000
Purchases 1,50,000
Purchase return 25,000
Direct expenses 10,000
Carriage Inwards 5,000
Sales 4,00,000
Closing stock 50,000

8. Prepare trading account of Archana as on 31.12.2013 from the following information.
Opening stock 80,000
Purchases 8,60,000
Fright inward 52,000
Wages 24,000
Sales 14,40,000
Purchase returns 10,000
Sales returns 3,16,000
Closing stock 1,00,000
Import duty 30,000
Power and fuel 20,000



9. Prepare trading and profit and loss account from the information given below.

Opening Stock
Purchase
Wages
Closing stock
Sales
Carriage on
purchase
Carriage on sales
3,600
18,260
3,620
4,420
32,000
500
400

Rent (Factory)
Rent (office)
Sales returns
Purchase returns
General expenses
Discount to customers
Interest from bank
400
500
700
900
900
360
200
Ans- Gross profit-10,240; Net profit-8,280

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10. From the following balances of Aravind prepare Trading account, Profit and Loss
account and Balance sheet as at 31.12.2013.
Dr Cr
Capital 72,000
Creditors 17,440
Bills payable 5,054
Sales 1,56,364
Loan 24,000
Debtors 7,770
Salaries 8,000
Discount 2,000
Postage 546
Bad debts 574
Interest 2,590
Insurance 834
Machinery 20,000
Stock (1.1.2013) 19,890
Purchase 1,24,000
Wages 8,600
Buildings 47,560
Furniture 32,310
Value of goods (31.12.3013) 28,600
Ans-GP-32,290; NP-17,746; BS-1,36,240







11. From the following Trial Balance of Thiru. Antony as on 31
st
March 2014, prepare
Trading and Profit & loss A/C and Balance sheet taking into account the adjustments.

Debit Balances Rs Credit Balances Rs.
Land and buildings
Machinery
Patents
Stock (1.4.2014)
Sundry debtors
Purchases
Cash in hand
42,000
20,000
7,500
5,760
14,500
40,675
540
Capital
Sales
Return outwards
Sundry Creditors
Bills payable


62,000
98,780
500
6,300
9,000

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Cash at bank
Return Inwards
Wages
Fuel and power
Carriage on sales
Carriage on purchases
Salaries
General expenses
Insurance
Drawings

2,630
680
8,480
4,730
3,200
2,040
15,000
3,000
600
5,245

1,76,580 1,76,580
Adjustments:
I. Stock on 31-03-2014 was Rs. 6,800.
II. Salary outstanding Rs. 1,500.
III. Insurance Prepaid Rs. 150.
IV. Depreciate machinery @ 10% and patents @ 20%.
V. Create a provision of 2% on debtors for bad debts.
Ans: GP-Rs. 43,715; NP-Rs. 16,775; BS-
90,330.

12. The following are the balances extracted from the ledger of Karihalan as on December
31.2012.

Rs Rs.
Karikalan’s Caoital A/C
Drawings
Buildings
Machinery
Furniture & fittings
Opening stock
Cycle
Purchases
Sale
Sales Returns
Duty paid on purchases
Sundry debtors
Sundry creditors
Reserve for bad & boubtful
debts
20,000
3,500
10,000
2,500
600
12,500
400
75,000
1,25,000
5,000
15,000
10,000
7,500
400

Reserve for discount on debtors
loan@9%
salaries
wages
Rent
Travelling expenses
Postage & Telegrams
Rates & Taxes
Carriage Inwards
Carriage Outwards
Interest paid
General charges
Bad debts
Cash in Hand
Cash at bank

200
5,000
4,400
7,500
2,750
1,250
135
90
2,500
750
375
900
300
250
2,400

The following adjustments are necessary:
a. Stock on 31.12.2012 Rs. 14,000

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b. Provide the following outstanding:
Salary Rs. 400; Rent Rs. 250: Wages Rs. 600 and Interest Rs.75
c. Maintain the reserve for doubtful debts at 5% and reserve for discount on debtors
at 2.5% on sundry debtors.
d. Provide depreciation for Building 2.5%, Machinery 10%, Furniture 6% and Cycle
15%
Prepare Trading & Profit and Loss a/c and Balance Sheet for the year ended 31.12.2012.
Ans- GP-Rs. 20,900; NP- Rs. 8,491.50; BS- Rs. 38,816.50

13. From the following Trial Balance of Mr. Xavier as on 31.3.1993, prepare Trading a/c,
Profit & Loss a/c for the year ended 31.3.1993 and a Balance Sheet as on that date after
making necessary adjustments:
Debit Balances Rs Credit Balances Rs.
Xavier’s Drawings
Furniture & Fittings
Plant and Machinery
Opening stock
Purchases
Salaries & wages
Debtors
Returns inwards
Postage & telegrams
Rent, Rates, Taxes
Bad debts Written off
Trade expenses
Interest on loan from Abdul
Insurance
Travelling expenses
Sundry expenses
Cash in hand
Cash at bank
12,000
4,000
30,000
20,000
80,000
22,400
20,400
5,000
1,500
3,600
400
200
150
800
500
300
3,050
10,300
Xavier’s Capital
Return outward
Sales
Creditors
Loan @6% p.a taken from
Abdul on 1.1.93
Discount
60,000
2,000
1,30,000
12,000

10,000
600
2,14,600 2,14,600

Adjustments;
I. Closing stock: cost price – Rs. 21,000 market price- Rs. 25,000
II. Of debtors, Rs. 400 are bad and should be written off. Create a reserve for discount
on debtors 2.5%
III. Salaries Rs. 800 for March 1993 was not paid.
IV. Interest on capital is to be calculated at 6% p.a. and on drawings Rs. 330.
V. Prepaid insurance amounted to Rs.100.
VI. Depreciate furniture & fittings by 5% and plant and Machinery by 10%.
VII. Make reserve for discount on creditors @ 2%.

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Ans- GP-Rs. 48,000; NP- Rs.10,920; BS- Rs. 84,750

14. The following is trial balance of Mr. Kumar as on 31
st
March, 2008:
Debit Credit
Rs. Rs.
Sales 1,20,000
Purchase 82,000
Customs Duty 8,000
Royalty 5,000
Opening stock 12,000
Accounts receivable 22,000
Accounts payable 8,000
Bad debts 2,000
Carriage inwards 1,000
Telephone charges 2,000
Printing & stationery 500
Investments 6,000
Interest 800
Land and Buildings 40,000
Rent 3,200
Income tax paid 3,000
Cash 1,500
Furniture 5,000
Capital 57,000
2,00,000 2,00,000
Adjustments:
a. Closing stock is valued @ RS. 22,000
b. Carriage On Purchase outstanding amount to Rs. 300.
c. Interest receivable amounts to Rs. 200.
d. Rent received in advance amounts to Rs. 400.
e. Depreciation @ 10% is required on furniture.
Prepare final accounts (May/June 2014) (2013-Regulation)

15. The following is the Trial Balance of Sriram Traders as on December 31, 2012.


Debit Balances Rs Credit Balances Rs.
drawings
Sundry debtors
Cash in hand
12,000
70,000
3,000
Capital
Sundry creditors
Loan
1,00,000
85,000
40,000

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Interest
Stock
Cash at bank
Bad debts
Land & buildings
Sales returns
Purchase
Carriage outwards
Carriage inwards
Establishment charges
Rates, Taxes and Insurance
Advertisement
General expenses
Wages
Bills receivable

2,000
40,000
9,000
4,000
90,000
7,000
1,20,000
2,000
3,000
14,500
4,000
6,000
5,000
10,000
11,500

Sales
Purchases returns
Discount
Bills payable
Rent received
Provision for bad debts

1,60,000
8,000
2,000
10,000
3,000
5,000
4,13,000 4,13,000

Additional information:
I. The stock in hand on December 31, 2011, is valued at Rs. 60,000.
II. Pre-paid insurance amount to Rs. 500.
III. Depreciate land and building @ 5% p.a.
IV. Bad debts provision is to be increases by Rs. 1,000.
You are required to prepare the trading and profit and loss Account for the year
ended 31.12.2012, and balance sheet as on that date.




16. From the following Ledger balances of a Trader, prepare Trading, Profit and Loss
account and Balance Sheet as at 31
st
December 2012.
Rs
Opening stock 48,000
Drawings 6,000
Sales 1,25,000
Sundry debtors 18,000
Capital 25,000
Wages 14,000
Salaries 2,800
Carriage on purchases 2,500
Rent 3,500
Purchases 60,000

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Discount on purchases 2,000
Interest on bank Loan 100
Bills receivable 3,000
Plant and Machinery 10,000
Cash 1,000
Building 2,500
Bills payable 2,500
Bank Loan 2,000
Reserve for bad depts. 2,500
Returns outwards 750
Sundry creditors 11,650

Adjustments:
Rent @ Rs. 100 per month is not paid for 2 months. Wages and salaries are unpaid to the
extent of Rs. 750 and 225 respectively. Depreciate plant by 10%. Stock at close was Rs.
17,500. Write off Rs. 1,500 as band debts and maintain a Reserve of 5% on debtors.