Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev

TS Grewal Solutions - Class 11 Accountancy

Created by: Nipun Tuteja

Commerce : Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev

The document Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev is a part of the Commerce Course TS Grewal Solutions - Class 11 Accountancy.
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Page No 19.64:
Question 1:
Following are the balances extracted from the books of Manish on 31st March, 2019:
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev

Prepare Trading and Profit and Loss Account and Balance Sheet as at 31st March, 2019 after following adjustments are made:
(i) Closing Stock was ₹ 16,000.
(ii) Depreciate Plant and Machinery @ 10% and Delivery Vehicle @ 15%.
(iii) Unpaid Rent amounted to ₹ 500.
ANSWER:
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev

Page No 19.65:
Question 2:
Prepare Trading and Profit and Loss Account and Balance Sheet from the following balances, relating to the year ended 31st March, 2019:
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Additional Information:
(i) Closing Stock was valued at ₹ 14,500.
(ii) Depreciate Plant and Machinery by ₹ 4,000.
(iii) Write off Bad Debts ₹ 5,000.
(iv) ₹ 400 is due for repairs.
ANSWER:
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev

Question 3:
Following Trial Balance has been extracted from the books of Prasad on 31st March, 2019:
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev

Additional Information:
(i) Outstanding salaries were ₹ 45,000.
(ii) Depreciate Machinery at 10%.
(iii) Wages outstanding were ₹ 5,000.
(iv) Rent prepaid ₹ 10,000.
(v) Provide for interest on capital @ 5% per annum.
(vi) Stock on 31st March, 2019 ₹ 8,00,000.
Prepare Trading and Profit and Loss Account for the year ended 31st March, 2019 and Balance Sheet as at that date.
ANSWER:
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev

Page No 19.66:
Question 4:
From the following Trial Balance of Shradha as on 31st March, 2019, prepare Trading and Profit and Loss Account and Balance Sheet:
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev

Adjustments:
(i) Closing Stock ₹ 64,000.
(ii) Wages outstanding ₹ 2,400.
(iii) Bad Debts ₹ 600.
(iv) Provision for Doubtful Debts to be 5%.
(v) Rent is paid for 11 months.
(vi) Insurance premium is paid per annum, ended 31st May, 2019.
(vii) Loan from the bank was taken on 1st October, 2018.
(viii) Provide Depreciation on machinery @ 10% and on Furniture @ 5%.
ANSWER:
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev


Question 5:
Trial Balance of a business as at 31st March, 2019 is given below:
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev

Prepare Trading and Profit and Loss Account for the year ended 31st March, 2019 and Balance Sheet as at that date after taking into account the following adjustments:
(i) Closing Stock was valued at ₹ 7,000.
(ii) Outstanding liabilities for wages were ₹ 600 and salaries ₹ 1,400.
(iii) Depreciation is to be provided @ 5% p.a. on fixed assets.
(iv) Included in Plant and Machinery is a machine purchased for ₹ 10,000 on 1st October, 2018.
(v) Insurance premium paid in advance ₹ 200.
ANSWER:

Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev

Question 6:
Following are the balances extracted from the books of Narain on 31st March, 2019:
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev

Additional Information:
(i) Closing Stock as on 31st March, 2019 was ₹ 2,00,600, whereas its Net Realisable Value (Market Value) was ₹ 2,05,000.
(ii) Depreciate: Business Premises by ₹ 3,000 and Furniture and Fittings by ₹ 2,500.
(iii) Make a provision of 5% on debtors for doubtful debts.
(iv) Carry forward ₹ 2,000 for unexpired insurance.
(v) Outstanding salary was ₹ 15,000.
Prepare Trading and Profit and Loss Account for the year and Balance Sheet as at that date.

ANSWER:
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Note: As per the prudence concept, closing stock is taken to be at the market value or the book value whichever is less.
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev

Page No 19.68:
Question 7: Following balances are taken from the books of Niranjan. Prepare Trading and Profit and Loss Account and Balance Sheet for the year ended 31st March, 2019:
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev

Adjustments:
(i) Closing Stock ₹ 7,50,000.
(ii) Depreciate Machinery by 10% and Furniture by 20%.
(iii) Wages ₹ 50,000 and salaries ₹ 20,000 are outstanding.
(iv) Write off ₹ 50,000 as further Bad Debts and create 5% Provision for Doubtful Debts. Also, create a reserve for discount on Debtors @ 2%.
(v) Investments were made on 1st July, 2018 and no interest has been received so far.

ANSWER:
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev

Question 8:
From the following Trial Balance of Mahesh, prepare his Final Accounts for the year ended 31st March, 2019:
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Additional Information:
(i) Closing Stock on 31st March, 2019 was ₹ 21,000.
(ii) Rent of ₹ 1,200 has been received in advance.
(iii) Outstanding liability for Miscellaneous expenses ₹ 12,000.
(iv) Commission earned during the year but not received was ₹ 2,100.
(v) Goods costing ₹ 2,000 were taken by the proprietor for his personal use but entry was not passed in the books of account.
ANSWER:
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev
Adjustments in Preparation of Financial Statements (Part - 1) Commerce Notes | EduRev

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