DAV INTERNATIONAL SCHOOL, Amritsar

Worksheet on Topic- Financial Statements with Adjustments(Class XI)

1. Tarak Mehta starts business on 1st April, 2021 with a capital of Rs. 3,00,000. The following trial balance
was drawn up from his books at the end of the year.
Particulars Amount Particulars Amount
Drawings 45,000 Capital 4,00,000
Plant & Fixtures 80,000 Sales 16,00,000
Purchases 11,60,000 Sundry creditors 1,20,000
Carriage inward 20,000 Bills Payable 90,000
Return inward 40,000
Wages 80,000
Salaries 1,00,000
Printing & Stationery 8,000
Advertisement 12,000
Trade Charges 6,000
Rent & Taxes 14,000
Sundry debtors 2,50,000
Bills Receivable 50,000
Investment 1,50,000
Discount 5,000
Cash at Bank 1,60,000
Cash in Hand 30,000
22,10,000 22,10,000
st
The value of stock as at 31 March, 2022 was Rs. 2,60,000. You are required to prepare Trading and Profit
& Loss account and Balance Sheet as at 31 st March, 2022.
Additional Information:
I) Interest on Capital is to be provided at 6% p.a. Additional capital of Rs. 1,00,000 was introduced on
Oct 1, 2021.
II) Plant & Fixtures are to be depreciated by 10% p.a.
III) Salaries outstanding on 31st March, 2022 were amounted to Rs. 5,000.
IV) Rs.5,000 are bad debts & a provision for doubtful debts is to be created @ 5% on debt
2.The following Trial Balance was extracted from the books of Mr. Gauransh as at 31 st March, 2022
Particulars Amount Particulars Amount
Capital 2,45,000 Loan 78,800
Drawings 20,000 Sales 6,53,600
General Expenses 47,400 Purchases 4,70,000
Building 1,10,000 Motor Car 20,000
Machinery 93,400 Provision for Doubtful debts 9,000
st
Stock on 1 April 1,62,000 Commission (Cr.) 13,200
Insurance 13,150 Car Expenses 18,000
Wages 72,000 Bill Payable 38,500
Debtors 62,800 Cash 800
Creditors 25,000 Bank overdraft 33,000
Bad Debts 5,500 Charity 1,050
Prepare Trading & Profit and Loss Account for the year ended and Balance Sheet as at that date after giving
effect to the following adjustments:
A) Stock as on 31st March, 2022 was valued at Rs. 2,30,000
B) Depreciate Machinery @ 10% & Building @ 12%.
C) Provide Rs. 7,000 as outstanding interest on loan.
 On March 25th fire broke out at the factory & goods worth Rs. 50,000 were destroyed. It was fully
insured and the insurance company admitted the claim in full.
(Ans: Gross Profit Rs. 2,29,600; Net Profit Rs. 1,37,160)
3. Prepare Trading and Profit and Loss Account from the following trial balance of Pankaj as on 31st
March, 2020:
Name of Account Debit (Rs) Credit (Rs)
Drawings and Capital 15,000 3,25,000
Plant and Machinery 2,00,000
Motor Vehicle 1,50,000
Returns 25,000 37,000
Stock at commencement 82,000
Purchases and Sales 4,40,000 6,75,000
Carriage 6,000
Trade Expenses 2,500
Bad Debts 4,250
Provision for Bad and Doubtful Debts 6,000
Rent Received 4,000
Rent, Rates and Taxes 12,000
Salaries and Wages 24,000
Debtors and Creditors 70,500 55,000
Fuel and Coal 4,250
Cash in Hand 16,500
Cash at Bank 50,000
11,02,000 11,02,000
Adjustments:
(a) Stock at the end was valued at Rs 1,10,000.
(b) Rent of premises sublet is Rs 300 per month.
(c) Salaries for the month of February and March are still unpaid.
(d) Rs 500 due from Yasmin for goods sold to her on credit were not recoverable. Provide
5% provision for doubtful debts.
(e) Depreciate Plant and Machinery by 15% and Vehicle by 25%.
(f) Coal for Rs 1,750 was purchased without payment but this transaction was omitted to be
recorded. (D.A.V. BOARD 2021)
(Ans. Gross Profit Rs. 2,63,000, Net Profit Rs. 1,56,350)
4. Following is the Trial Balance of Mr. Sharma as at 31/3/22
Particulars Debit Balance Credit Balance
Drawings and Capital 3,500 50,000
Purchase and Sales 28,000 55.000
Returns 1500 2000
Stock (1/4/21) 15,000
Bad debts 400
Provision for bad debts 600
Rates and Insurance 1,300
Discount 400
Bills receivable 6000
Loan to Anuj @5% 15,000
Bills Receivable 1950
Interest on Loan to Anuj 500
Rent Outstanding 300
 Carriage Inward 1200
Office expenses 1340
Carriage Outward 750
Debtors and Creditors 30,600 12,000
Cash in hand 14,400
Rent 800
Advertisement Expenses 900
Wages 6000
1,20,400 1,20,400
Prepare Trading and Profit & Loss A/c only for the year ended31/3/2022(D.A.V. BOARD 2022)
1. Stock on 31-3-2022 was valued at Rs. 18,000
2. The manager is entitled to a commission of 10% of the net profit calculated after charging such
commission.
3.Futher bad debts of Rs. 600. Increase provision for doubtful debts by Rs. 2400. Also create a
provision @5%for discount on debtors.
4. Stock valued at Rs. 1500 was destroyed by fire on 26-12-2021. Insurance company
Admitted claim of Rs. 950 only.
5. Rs. 200 0ut of the advertisement expenses are to be carried forward to next year
(Ans: Gross Profit Rs. 24,800, Net Profit Rs. 16000)
5. The following balances appeared in the Trial Balance of M/s Doraemon Traders as at 31/3/2022
✔ Debtors Rs. 4,10,000
✔ Bad Debts Rs. 6,000
✔ Provision for Bad Debts Rs.20,000
Further bad debts were Rs. 10,000 and they decided to maintain a provision for bad debts@10%.
Pass the necessary journal entries.(D.A.V. BOARD SAMPLE PAPER 2023)
6. Pass necessary adjustment entries and closing entries for the following adjustments
1. Goods worth Rs.9,000 were used by proprietor for personal use
2. Sign board costing Rs.4,000 was included in Advertising expenses of Rs.25,000
3. Private purchases Rs.6,000 were paid from personal saving bank a/c of the proprietor
4. Fire insurance premium Rs.1,800 paid during the year included Rs.1,200 paid on 1/7/2021 to run for one
year till 30/6/2022
5. Provide for manager commission @10 % of Net profit after charging such commission. The net profit
transferred to capital was ₹20,623 (D.A.V. BOARD SAMPLE PAPER 2023)
7. Following is the Trial Balance of Mrs. Gupta as at 31/3/22(D.A.V. BOARD 2024)

Particulars Debit Balance Credit

Balance
Drawings and Capital 35,000 3,02,000
Purchase and Sales 2,60,000 6,30,000
Power and Fuel 65,500
Stock(1/4/21) 50,000
Bad Debts 25,000
Provision For Bad Debts 21,000
Discount 23,000
Return Inward 15,000
Wages 44,000
Reserves 55,000
Rent 24,000
Salaries 1,20,000
 Carriage 4,500
Interest on Loan to Raj 8,000
Trade Expenses 18,000
Insurance Premium 6,000
Rent Paid in Advance 2,500
Fixed Deposit 1,00,000
Debtors and Creditors 1,91,000 43,500
Loan from Raj@12%(Taken on 1/4/21) 1,00,000
Cash at Bank 30,000
Salaries Outstanding 24,000
Furniture 50,000
Machinery 1,50,000
11,98,500 11,98,500
Prepare Trading and Profit & Loss A/c for the year ended 31/3/2022
1.Depreciate Machinery by Rs. 5%p.a. and Furniture by 10%p.a.
2.Wages is paid for 11 months.
3.Insurance premium is paid for the year ending 30th June,2022.
4.Stock was valued at Rs. 1,25,000 (cost) whereas its market price was Rs. 1,15,000.
(Ans: Gross Profit Rs. 3,02,000; Net Profit Rs. 1,32,500)
8. Following is the Trial Balance of M/s Sham Lal and Brothers as at 31/3/22
Particulars Debit Balance Credit Balance
Opening stock 1,30,000
Rent 35,000
Capital 3,50,000
Plant and Machinery 1,00,000
Provision for Depreciation on Machinery 10,000
Loan on Mortgage 80,000
Purchases and Sales 1,60,000 6,58,600
Returns 4,000 12,000
Provision for bad debts 12,000
Postage 25,000
Wages 45,000
Salaries 2,60,000
Insurance 8,000
Power, Fuel & Gas 25,600
Office Expenses 80,000
Debtors and Creditors 2,50,000 40,000
Cash at Bank 28,000
Income Tax 10,000
Commission 9,000
Bad debts 11,000
11,71,600 11 ,71,600
Adjustments:
1. Closing stock Rs.2,26,000
2. Depreciate Plant and Machinery @ 10%p.a. W.D.V. Method (Diminishing Balance Method)
3. Accrued Commission Rs. 3,000
4. Salary is paid for 13 months
5. Gross Profit was calculated to be Rs.5,32,000 for the year ended 31/3/2022
6. Insurance premium is paid upto 30th June 2022.
Prepare Profit &Loss a/c and Position Statement only (D.A.V. BOARD 2024)
(Ans: Net Profit Rs. 1,50,000; Balance Sheet Total Rs. 6,29,000)
9. Following is the Trial Balance of Tenali Ram at 31/3/2020. Your are required to prepare Trading and
Profit & Loss A/c
Particulars Debit Balance Credit Balance
Opening stock 15,000
Rent 4,000
Capital 1,00,000
Plant 72,000
Loan to Tathacharya@10%p.a. 5,000
Interest on Loan to Tathacharya 300
Purchases and Sales 1,09,000 1,80,000
Apprenticeship Premium 4,500
Bills Receivable and Payable 6,000 1,600
Fuel 12,000
Salaries 11,000
Rent Outstanding 600
Workshop Expenses 8,000
Debtors and Creditors 28,000 13,000
Cash in Hand 19,500
Income Tax 5,500
Furniture (including Rs. 1,000 purchased on 1/10/19) 5,000
Total 3,00,000 3,00,000
Additional Information: (D.A.V. BOARD 2021)
1. Furniture is to be depreciated to 90%.
2. Stock at the end was Rs. 40,000 (cost price) but due to slow down in the market it was expected to
realise only 75%.
3. Chinnadevi, a customer was declared insolvent and nothing could be recovered from her dues of Rs.
2,000. A provision of 5% was to be created for bad and doubtful debts.
4. Apprentice premium was received on 1st April , 2019 for 3 years.
5. Salaries for the month of March, 2020 was still outstanding.
(Ans: Gross Profit Rs. 66,000, Net Profit Rs. 48,250)
10. Following is the blank spaces in the following Financial Statements of M/s Shiv Kumar & Sons:
Trading and Profit & Loss Account of M/s. Shiv Kumar & Sons for the year ended 31st March
2021
Particulars Amount Particulars Amount
To Opening Stock ? By Sales 1,43,000
To Purchases 1,06,600 1,05,300 By Closing Stock ?
Less Purchase Return(1300)
To Wages 2500
To Carriage on Purchase 100
To Gross Profit transferred to Profit& Loss ?
A/c
1,69,000 1,69,000
To Office Rent 6630 By Gross Profit B/d 41,600
To Insurance 780 715 By Interest on Investment ?
 Less : ? ?
To Salary 16,250 ? By Commission 1950 ?
Add : ? ? Add : Accrued Comm.?
To Depreciation on Building ? ??
Furniture ?
To Bad Debts 260
To Advertisement 1950
To Net Profit before Manager’s Commission ?
44,590 44,590
To Manager’s Commission 650 By Net Profit before ?
Manager’s Commission
To Net Profit after Manager’s Commission ?
? ?
Balance Sheet of Shiv Kumar & Sons as at 31-3-2021
Liabilities Amount Assets Amount
Creditors 42,900 Cash in Hand 5,000
Outstanding Salary 1,300 Cash at Bank ?
Manager’s Commission ? ?? 26,000
Capital 1,04,000 ? Debtors 26,130
Add: Net Profit ?
Accrued Commission 390
?? 65
Building ? ?
Less: Depreciation@5% 2925
Furniture ? ?
Less : Depreciation@10% 910
10% Investment 6,500
1,61,850 1,61,850
Note : Manager is to be allowed a commission of 5% of net profit after charging such commission.
(D.A.V. BOARD 2022)