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प्रश्न
Select the most appropriate alternative from those given below and rewrite the statement.
Wages paid for installation of machinery should be debited to _________________ account.
पर्याय
machinery
wages
trading
profit and loss
उत्तर
Wages paid for installation of machinery should be debited to Machinery account.
Explanation: Wages paid for the Machinery installation should be debited to the Machinery Account. Such wages should not be debited to the Trading Account because these wages represent capital expenditure. So, it must be added to the cost of the machine.
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संबंधित प्रश्न
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The credit balance of Trading Account.
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All direct expenses are debited to Trading account.
State whether the following statement is True or False.
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State whether the following statement is True or False.
Trading account is a nominal account.
State whether the following statement is True or False.
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State whether the following statement is True or False.
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Balance sheet is ______.
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From the following Trial Balance of Nandini & Co. as of 31st March 2019. Prepare Final Accounts after considering the adjustments given below.
| Particulars | Debit Amount (₹) | Credit Amount (₹) |
| Loose Tools | 1,10,000 | |
| Furniture & Fixtures | 81,000 | |
| Bad debts | 1,400 | |
| Sundry Debtors | 81,600 | |
| Stock (31st March 2018) | 52,000 | |
| Purchases | 77,000 | |
| Sales Cash | 21,000 | |
| Sales Credit | 81,000 | |
| Returns | 400 | 600 |
| Advertisements | 4,800 | |
| Rate taxes & Insurances | 6,000 | |
| Repairs & maintenance | 1,200 | |
| Salaries (2/3rd for factory) | 18,000 | |
| Rent (Paid for 11 months) | 2,200 | |
| Machinery (Includes ₹ 24,000 | 84,000 | |
| purchased on 1st Oct. 2018) | ||
| Capital | 3,60,000 | |
| R.D.D. | 8,000 | |
| Sundry Creditors | 70,000 | |
| Drawings | 14,000 | |
| Interest | 1,200 | |
| Dividend | 2,800 | |
| Bank Balance | 40,000 | |
| Royalty | 6,000 | |
| 9% Bank loan (30th Sept 2018) | 40,000 | |
| Carriage Outwards | 4,000 | |
| Discount | 1,000 | |
| 5,84,600 | 5,84,600 |
Adjustments:
1. Closing stock valued at ₹ 1,00,000.
2. Write off ₹ 2,000 as bad debts and create a provision for doubtful debts @ 5% on Sundry Debtor.
3. Depreciate Machinery by 10% p.a. and Loose Tools is valued at ₹ 1,00,000.
4. Charge Interest on Capital @ 2% p.a.
Prepare Final accounts of Abdul Traders for the year ending 31st March 2019 with the help of the following Trial Balance and Adjustments.
Trial Balance as of 31st March 2019.
| Debit Balance | Amount (₹) | Credit Balance | Amount (₹) |
| Salaries | 10,000 | Interest Received | 2,400 |
| Purchases | 71,400 | Capital | 1,60,000 |
| Rent (11 months) | 2,200 | Sales | 85,000 |
| Machinery | 56,000 | Provision for Bad Debts | 2,000 |
| Advance against wages | 4,000 | Commissions Received | 1,600 |
| Opening stock | 20,000 | Bills Payable | 9,200 |
| Bad debts | 1,000 | Creditors | 56,000 |
| Prepaid Insurance | 2,400 | ||
| Wages | 2,600 | ||
| Loose Tools | 26,000 | ||
| Commission receivable | 400 | ||
| Sundry Debtors | 64,000 | ||
| Cash | 1,000 | ||
| Bank | 3,000 | ||
| Drawings | 7,600 | ||
| Freight Inward | 1,000 | ||
| Bills Receivable | 13,600 | ||
| Loan to Aruna | 30,000 | ||
| 3,16,200 | 3,16,200 |
Adjustments:
1. Closing stock valued at ₹ 89,600
2. Outstanding expenses Salaries ₹ 2,000, Wages ₹ 4,000
3. Charge depreciation on Machinery @ 10%
4. Bad debts are written off ₹ 2,000 and create a provision for bad and doubtful debts 5% on Sundry Debtors.
Following is the Trial Balance of Geeta Enterprises. You are required to prepare a Trading and Profit & Loss Account for the year ended 31st March 2019 and the Balance Sheet as of that date after taking into account the additional information provided to you.
Trial Balance as of 31st March, 2019
| Particulars | Debit Amount (₹) | Credit Amount (₹) |
| Capital A/c | 50,000 | |
| Drawings | 1,750 | |
| Opening Stock | 8,000 | |
| Purchases & Sales | 16,500 | 22,500 |
| Returns | 625 | 750 |
| Carriage Outward | 425 | |
| Wages - Productive | 1,000 | |
| Unproductive | 600 | |
| Salaries | 1,000 | |
| Travelling expenses | 1,125 | |
| Trade Expenses | 325 | |
| Fuel and Coal | 250 | |
| Discount | 460 | 550 |
| Sundry expenses | 225 | |
| Bad Debts | 200 | |
| Plant & Machinery | 20,000 | |
| Furniture | 5,500 | |
| Packing expenses | 175 | |
| Sundry Debtors & Creditors | 10,090 | 6,750 |
| Cash in hand | 2,200 | |
| Investments | 10,250 | |
| Reserve for Doubtful debts | 150 | |
| 80,700 | 80,700 |
Additional information:
1. Closing stock of goods on 31st March 2019 valued at ₹ 7,100 at cost price and ₹ 7,500/- as market price.
2. Travelling expenses include ₹ 125 spent on personal traveling.
3. ₹ 175 is to be written off as bad debts which were due from Mr. Ashok, a debtor, and 5% R.D.D. is to be maintained on debtors.
4. Reserve for discount on debtors as well as on creditors is to be maintained at 2% and 3% respectively.
5. Provide 10% depreciation on Plant & Machinery and Furniture.
Following are the closing ledger balances of Deepak & Co. Prepare Trading Account and Profit & Loss Account for the year ended 31st March 2019 and Balance sheet as of that date.
Ledger Balances of Mr. Deepak and Co. as of 31st March, 2019
| Particulars | Amount (₹) | Particulars | Amount (₹) |
| Bank | 30,000 | Capital | 1,20,000 |
| Bills Payable | 7,500 | Insurance Premium | 18,000 |
| Furniture | 19,500 | (1.1.2019 to 31.12.2019) | |
| Commission Received | 3,000 | Salaries | 30,000 |
| Stock (1.4.2018) | 27,000 | Bank loan | 30,000 |
| Building | 37,500 | Sundry expenses | 7,500 |
| Wages | 7,500 | Interest paid | 1,500 |
| Creditors | 37,500 | Machinery | 25,500 |
| Bad Debts | 4,500 | Sales | 96,000 |
| R.D.D. (old) | 3,000 | Purchases | 42,000 |
| Sales Returns | 1,500 | Debtors | 31,500 |
| Purchases returns | 3,000 | ||
| Cash in hand | 16,500 |
Adjustments:
1. Closing stock was valued at ₹ 60,000
2. An amount of ₹ 3,000 is still to be received on account of commission.
3. Provision for discount on debtors and Provision for discount on Creditors are to be created 2% and 3% respectively.
4. Amount of Furniture is to reduce by ₹ 4,500 and Building by 10%.
5. Outstanding expenses Salaries ₹ 4,500 and Wages ₹ 1,500.
Following is the Trial Balance extracted from the books of Raju Traders. You are required to prepare Trading A/c, Profit and Loss A/c for the year ending on 31st March 2019 and Balance Sheet as on that date after considering the additional information given below.
Trial Balance as of 31st March 2019
| Debit Balance | Amount (₹) | Credit Balance | Amount (₹) |
| Raju's Drawings | 5,000 | Capital | 2,00,000 |
| Opening stock | 30,000 | Sales | 1,64,000 |
| Wages | 5,000 | Returns outward | 2,400 |
| Purchases | 60,000 | Creditors | 40,000 |
| Trade Expenses | 800 | Discount | 1,600 |
| Royalties | 1,600 | Bills payable | 13,600 |
| Salaries | 20,000 | ||
| Debtors | 80,000 | ||
| Plant & Machinery | 56,000 | ||
| Printing & Stationery | 2,400 | ||
| Bad debts | 900 | ||
| Discount | 1,200 | ||
| Furniture | 16,000 | ||
| Advertisement | 3,000 | ||
| Carriage outwards | 600 | ||
| Computers | 1,20,000 | ||
| Bills Receivable | 16,000 | ||
| Cash in hand | 1,100 | ||
| Cash at Bank | 2,000 | ||
| 4,21,600 | 4,21,600 |
Adjustments:
- Closing stock is valued at ₹ 40,000 at Cost Price and ₹ 44,000 as Market Price.
- Provide Depreciation on Plant and Machinery, Furniture, Computers @ 5%, 10%, 15%, respectively.
- Salaries are paid for 10 months only.
- Further Bad debts amounted to ₹ 400 and provide 10% R.D.D. on Sundry Debtors.
- Advertisement is paid for 2 years.
From the following Trial Balance of Ayub & Co. as of 31st March 2019, you are required to prepare Trading Account, Profit and Loss Account for the year ending 31st March 2019, and Balance Sheet as of that date after making necessary adjustments.
Trial Balance as of 31st March 2019
| Debit balances | Amount (₹) | Credit Balances | Amount (₹) |
| Cash in hand | 4,575 | Discount | 900 |
| Cash at Bank | 15,450 | Loan from Abhay | 15,000 |
| Drawings | 18,000 | Creditors | 18,225 |
| Furniture | 6,000 | Sales | 1,95,000 |
| Plant & Machinery | 45,000 | Returns Outward | 3,000 |
| Opening Stock | 30,000 | Capital | 90,000 |
| Purchases | 1,20,000 | ||
| Salaries and Wages | 33,600 | ||
| Debtors | 30,600 | ||
| Returns Inward | 7,500 | ||
| Audit Fees | 2,250 | ||
| Rent. Rates and Taxes | 5,400 | ||
| Bad debts | 600 | ||
| Travelling Expenses | 750 | ||
| Insurance | 1,200 | ||
| Interest on Loan from Abhay | 450 | ||
| Trade Expenses | 300 | ||
| Sundry expenses | 450 | ||
| 3,22,125 | 3,22,125 |
Adjustments:
1. Stock on hand on 31st March 2019 valued at ₹ 60,000
2. Rent amounting to ₹ 600 Prepaid.
3. Bad Debts ₹ 600 and create a Provision for Doubtful Debts 5%
4. Depreciation on Plant & Machinery by 10% and Furniture is valued at ₹ 4,500
5. Outstanding Salaries ₹ 900
From the following Trial Balance of Manish Enterprise, Prepare the Trading Account and Profit and Loss Account for the year ended 31st March 2019 and Balance sheet as of that date.
Trial Balance as of 31st March 2019
| Debit balances | Amount (₹) | Credit Balances | Amount (₹) |
| Cash in hand | 5,200 | Capital | 50,000 |
| Opening stock | 10,370 | Bank Loan | 15,000 |
| Goodwill | 10,000 | Bills Payable | 8,500 |
| Patents | 4,000 | Creditors | 38,260 |
| Cash at Bank | 4,400 | General Reserve | 1,500 |
| Freight | 2,500 | Dividend | 2,000 |
| Power & Fuel | 1,500 | Interest on Fixed Deposit | 3,440 |
| Furniture | 12,000 | Sales | 40,000 |
| Purchases | 35,260 | ||
| Mobile charges | 3,200 | ||
| Factory Salaries | 2,400 | ||
| Repairs | 800 | ||
| Lighting | 1,000 | ||
| Carriage outward | 360 | ||
| Professional charges | 1,240 | ||
| Debtors | 40,000 | ||
| Plant & Machinery | 13,700 | ||
| Office Equipments | 10,000 | ||
| Carriage Inwards | 770 | ||
| 1,58,700 | 1,58,700 |
Adjustments:
1. Closing Stock was ₹ 32,000.
2. Write off 50% of patents, depreciate Plant & Machinery by 10% p.a and Office Equipment by 20%.
3. Reserve for bad debts is to be created 5% and discount on Debtors 2%.
4. Outstanding expenses Mobile charges ₹ 300 and Freight ₹ 500
5. Charge Interest on Capital @ 5%.
6. Goods of ₹ 2,000 distributed on free samples.
