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Lecture 9 Shri Govind Numerical

The document provides the account balances from the books of Shri Govind as of March 31, 2010. It also lists adjusting transactions that need to be made, including updating stock values, recording a new machine purchase, depreciating various assets, writing off and providing for bad debts, and calculating manager commission. The assistant is asked to prepare an income statement for the year ending March 31, 2010 and a balance sheet as of March 31, 2010 for Shri Govind based on this information, showing all working notes.

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655 views1 page

Lecture 9 Shri Govind Numerical

The document provides the account balances from the books of Shri Govind as of March 31, 2010. It also lists adjusting transactions that need to be made, including updating stock values, recording a new machine purchase, depreciating various assets, writing off and providing for bad debts, and calculating manager commission. The assistant is asked to prepare an income statement for the year ending March 31, 2010 and a balance sheet as of March 31, 2010 for Shri Govind based on this information, showing all working notes.

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himanshumaholia
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© Attribution Non-Commercial (BY-NC)
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The account balances extracted from the books of Shri Govind as at the end of March 31, 2010 are

as follows: (all figures in thousands of rupees)


Particulars Wages Sundry Debtors Sundry creditors Shri Govind's Drawings Shri Govind's Capital Sales Salaries Returns Outward Purchases Provision of Bad debts Postage & Telegram Plant & Machinery Op. Stock Office Rent Office Furniture Office Expenses Losse Tools Loan to Shri Krishna Interest on Loan to Shri Krishna Insurance Gas & Fuel Freight Freehold Property Factory Lighting Discounts a/c (Dr.) Cash on Hand Cash at Bank Bills Payable Bad debts Amount 35,200 29,260 44,000 13,200 228,800 231,440 13,200 1,100 110,000 880 1,540 99,000 38,500 2,860 5,500 2,750 2,200 44,000 1,100 1,760 2,970 9,900 66,000 1,100 1,320 2,640 29,260 5,500 660

The information regarding the adjusting transactions is as follows ((all figures in thousands of rupees) : 1. Stock on 31st march 2010 was valued at 72,600. 2. A new machine was installed during the year costing Rs. 15, 400 but it was not recorded in the books as no payment was made for it. Wages Rs 1,100 paid for its erection have been debited to wages account. 3. Depreciate: a. Plant and Machinery by 33 1 3 %. b. Furniture by 10%. c. Freehold property by 5% 4. Loose tools were valued at Rs. 1,760 on March 31, 2010. 5. Of the Sundry debtors Rs 600 are bad and should be written off. 6. Maintain a provision of 5% on Sundry debtors for doubtful debts. 7. The manager is entitled to a commission of 10% of the net profits after charging such commission.
You are required to prepare the following financial statements for the Shri Govind: Question 1(a) Income Statement for the year ending on March 31, 2010; and Question 1(b) Balance Sheet as on March 31, 2010

You must present both the financial statements in the horizontal format only. You must clearly show and label all the working notes as the Working Notes'. Assume that the firm has been exempted from payment of taxes.

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