Answer :
Sure! Let's go through each requirement step by step.
### 1. Trading Account
The Trading Account is designed to determine the gross profit or loss of the business by comparing the sales with the cost of goods sold (COGS).
Given the data:
- Sales: Rs 600,000
- Purchases: Rs 350,000
- Direct Expenses:
- Carriage: Rs 125,000
- Factory Expenses: Rs 75,000
- Wages: Rs 45,000
#### Calculation:
- Carriage + Factory Expenses + Wages = 125,000 + 75,000 + 45,000 = Rs 245,000
- Purchases + Direct Expenses = 350,000 + 245,000 = Rs 595,000
Since opening stock and closing stock are not provided, we'll assume them to be zero for calculation purposes.
- Gross Profit = Sales - (Purchases + Direct Expenses)
- Gross Profit = 600,000 - 595,000 = Rs 5,000
### 2. Profit and Loss Account
The Profit and Loss Account shows the net profit or loss for the period by including all other incomes and expenses.
Given the data:
- Gross Profit: Rs 5,000 (from Trading Account)
- Other Incomes:
- Rent Received: Rs 25,000
- Expenses:
- Salary: Rs 75,000
#### Calculation:
- Net Profit = Gross Profit + Other Incomes - Expenses
- Net Profit = 5,000 + 25,000 - 75,000 = Rs -45,000 (indicating a net loss)
### 3. Balance Sheet
The Balance Sheet is prepared to show the financial position of the business on a given date. It consists of Assets, Liabilities, and Equity.
Given the data:
- Assets:
- Office Equipment: Rs 50,000
- Plant and Machinery: Rs 260,000
- Cash at Bank: Rs 200,000
- Liabilities:
- Bills Payable: Rs 5,001
- Bank Loan: Rs 225,000
- Equity:
- Capital: Rs 300,000
Adding the net loss from the Profit and Loss account will adjust the equity.
#### Calculation:
- Total Assets: Office Equipment + Plant and Machinery + Cash at Bank = 50,000 + 260,000 + 200,000 = Rs 510,000
- Total Liabilities: Capital + Bills Payable + Bank Loan = 300,000 + 5,001 + 225,000 = Rs 530,001 (initial equity and liabilities without factoring in the net loss)
We need to adjust the capital by deducting the net loss:
- Adjusted Capital = Capital - Net Loss = 300,000 - 45,000 = Rs 255,000
Thus, adjusting the total equity and liabilities:
- Total Liabilities and Equity = Bills Payable + Bank Loan + Adjusted Capital = 5,001 + 225,000 + 255,000 = Rs 485,001
### Summary:
1. Trading Account:
- Gross Profit: Rs 5,000
2. Profit and Loss Account:
- Net Profit (Net Loss): Rs -45,000
3. Balance Sheet:
- Total Assets: Rs 510,000
- Total Liabilities and Equity: Rs 485,001
### 1. Trading Account
The Trading Account is designed to determine the gross profit or loss of the business by comparing the sales with the cost of goods sold (COGS).
Given the data:
- Sales: Rs 600,000
- Purchases: Rs 350,000
- Direct Expenses:
- Carriage: Rs 125,000
- Factory Expenses: Rs 75,000
- Wages: Rs 45,000
#### Calculation:
- Carriage + Factory Expenses + Wages = 125,000 + 75,000 + 45,000 = Rs 245,000
- Purchases + Direct Expenses = 350,000 + 245,000 = Rs 595,000
Since opening stock and closing stock are not provided, we'll assume them to be zero for calculation purposes.
- Gross Profit = Sales - (Purchases + Direct Expenses)
- Gross Profit = 600,000 - 595,000 = Rs 5,000
### 2. Profit and Loss Account
The Profit and Loss Account shows the net profit or loss for the period by including all other incomes and expenses.
Given the data:
- Gross Profit: Rs 5,000 (from Trading Account)
- Other Incomes:
- Rent Received: Rs 25,000
- Expenses:
- Salary: Rs 75,000
#### Calculation:
- Net Profit = Gross Profit + Other Incomes - Expenses
- Net Profit = 5,000 + 25,000 - 75,000 = Rs -45,000 (indicating a net loss)
### 3. Balance Sheet
The Balance Sheet is prepared to show the financial position of the business on a given date. It consists of Assets, Liabilities, and Equity.
Given the data:
- Assets:
- Office Equipment: Rs 50,000
- Plant and Machinery: Rs 260,000
- Cash at Bank: Rs 200,000
- Liabilities:
- Bills Payable: Rs 5,001
- Bank Loan: Rs 225,000
- Equity:
- Capital: Rs 300,000
Adding the net loss from the Profit and Loss account will adjust the equity.
#### Calculation:
- Total Assets: Office Equipment + Plant and Machinery + Cash at Bank = 50,000 + 260,000 + 200,000 = Rs 510,000
- Total Liabilities: Capital + Bills Payable + Bank Loan = 300,000 + 5,001 + 225,000 = Rs 530,001 (initial equity and liabilities without factoring in the net loss)
We need to adjust the capital by deducting the net loss:
- Adjusted Capital = Capital - Net Loss = 300,000 - 45,000 = Rs 255,000
Thus, adjusting the total equity and liabilities:
- Total Liabilities and Equity = Bills Payable + Bank Loan + Adjusted Capital = 5,001 + 225,000 + 255,000 = Rs 485,001
### Summary:
1. Trading Account:
- Gross Profit: Rs 5,000
2. Profit and Loss Account:
- Net Profit (Net Loss): Rs -45,000
3. Balance Sheet:
- Total Assets: Rs 510,000
- Total Liabilities and Equity: Rs 485,001
