From the following Trial Balance of Jyoti Trading Co. Prepare Trading Account and Profit & Loss Account for the year ended 31st March 2019 and Balance Sheet as on that date

Trial Balance as on 31st March 2019

Debit Balance	Amount	Credit Balance	Amount
Stock (1.4.2018)	9,500	Capital	2,00,000
Sales Returns	750	R.D.D.	1,000
Loose Tools	55,000	Sales	38,750
Debtors	50,800	Purchases return	455
Bills Receivable	4,000	Creditors	47,000
Purchases	29,455	Bills Payable	8,000
Furniture	15,000
Salaries	5,000
Carriage Outward	3,000
Legal expenses	2,000
Insurance	2,200
Goodwill	20,000
Machinery	40,000
Wages	2,345
Bank	30,000
Drawings	8,000
Investments	20,000
	2,97,050		2,97,050

Adjustments:

1. Closing Stock valued at 58,000 Cost Price while Market Price is 60,000

2. Write off 1,200 as bad debts and create provision for doubtful debts 2% on Sundry Debtors and also create provision for doubtful discount on creditors 5%

3. loose Tools is valued at 52,000 and depreciation Furniture by 10% p.a.

4. outstanding expenses Salary 1,000 and Wages 225

5. charge interest on capital 2% and on Drawing 10%


Solution:

In the Books of Jyoti Trading Co. Final Account


Trading A/c And Profit & Loss A/c for the year ended 31st march, 2019 

Particulars	Amount	Amount	Particulars	Amount	Amount
To Opening Stock		9,500	By Sales	38,750	38,000
			(-) Sales Return	(750)
To Purchases	29,455
(-) Purchase Return	(455)	29,000
To Wages	2,345		By Closing stock		58,000
(+) Outstanding Wages	225	2,570
To Gross Profit c/d		54,930
		96,000			96,000

To Bad debts         (A)	1,200		By Gross Profit b/d		54,930
(+) R.D.D.               (A)	992
	2,192		By Discount		1,845
(-) R.D.D.               (T)	1,000	1,192
To Carriage Outward		3,000	By R.D.C		2,350
To Salaries	5,000		By Interest on Drawings		800
(+) Outstanding Salaries	1,000	6,000
To Legal expenses		2,000
To Insurance		2,200
To Depreciation on
Loose Tools	3,000
Furniture	1,500	4,500
To Net Profit		37,033
		59,925			59,925

Balance Sheet as on 31st March, 2019

Liabilities	Amount	Amount	Assets	Amount	Amount
Capital	2,00,000		Loose Tools	55,000
(+) Interest on capital	4,000		(-) Depreciation	3,000	52,000
	2,04,000
(-) Drawing	8,000		Furniture	15,000
(-) interest on drawing	800		(-) Depreciation	1,500	13,500
	1,95,200
(+) Net Profit	37,033	2,32,233	Goodwill		20,000
			Bills Receivable		4,000
			Machinery		4,000
			Bank		30,000
Creditors	47,000		Debtors	30,800
(-) R.D.C.	2,350	44,650	(-) Bad Debts       (A)	1,200
				49,600
Bills Payable		8,000	(-) R.D.D.            (A)	992	4877,608
Outstanding			Investments		20,000
Wages	225
Salaries	1,000	1,225
			Closing Stock		58,000
		2,86,108			2,86,108