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State and explain any 'four objectives' of financial statement analysis from the business point of view.
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State and explain any 'four objectives' of financial statement analysis from the business point of view.
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Devendra and Ganesh were partners sharing profits and losses in the ratio of 3: 2. They dissolved the partnership firm on 31st March 2013 when their position was as follows:
The assets realised as follows:
| Balance Sheet as on 31.03.2013 | |||
| Liabilities | Amount Rs | Assets | Amount Rs. |
| Sundry Creditor | 12,500 | Debtors 56,250 | |
| Bank Overdraft | 10,000 | Less: R.D.D. 6,250 | 50000 |
| Reserve Fund | 15,000 | Stock | 112500 |
| Capital Accounts: | Furniture | 25000 | |
| Devendra 1,15,000 | Motor Car | 37500 | |
| Ganesh 75,000 | Cash in hand | 2500 | |
| 227500 | 227500 | ||
(1) Debtors Rs. 45,000, stock Rs. 1,00,000 and goodwill Rs. 12,500
(2) The motor car was taken over by Devendra for Rs. 35,000 and furniture by Ganesh for Rs. 30,000.
(3) The creditors were paid Rs. 11,250 in full settlement.
(4) The realisation expenses were Rs. 5,000.
Pass necessary journal entries in the books of the firm.
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Devendra and Ganesh were partners sharing profits and losses in the ratio of 3: 2. They dissolved the partnership firm on 31st March 2013 when their position was as follows:
The assets realised as follows:
| Balance Sheet as on 31.03.2013 | |||
| Liabilities | Amount Rs | Assets | Amount Rs. |
| Sundry Creditor | 12,500 | Debtors 56,250 | |
| Bank Overdraft | 10,000 | Less: R.D.D. 6,250 | 50000 |
| Reserve Fund | 15,000 | Stock | 112500 |
| Capital Accounts: | Furniture | 25000 | |
| Devendra 1,15,000 | Motor Car | 37500 | |
| Ganesh 75,000 | Cash in hand | 2500 | |
| 227500 | 227500 | ||
(1) Debtors Rs. 45,000, stock Rs. 1,00,000 and goodwill Rs. 12,500
(2) The motor car was taken over by Devendra for Rs. 35,000 and furniture by Ganesh for Rs. 30,000.
(3) The creditors were paid Rs. 11,250 in full settlement.
(4) The realisation expenses were Rs. 5,000.
Pass necessary journal entries in the books of the firm.
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Miss Meena and Miss Reena are in partnership sharing profits and losses in the ratio of 3: 2.
From the following trial balance and adjustments, you are required to prepare Trading Account, Profit and Loss Account for the year ended 31st March 2013 and Balance Sheet as on that date.
Trial Balance as on 31.03.2013
| Trial Balance as on 31.03.2013 | |||
| Particulars | Debit Amount (Rs) | Particulars | Credit Amount (Rs) |
| Building | 4,00,000 | Capital Accounts: | |
| Plant and Machinery | 1,20,000 | Meena 3,00,000 | |
| Purchases | 6,50,000 | Reena 2,00,000 | 5,00,000 |
| Carriage | 7,000 | Sales | 8,14,000 |
| Opening Stock | 90,000 | Sundry Creditors | 1,80,000 |
| Wages | 35,000 | Bank Overdraft | 20,000 |
| Sundry Debtors | 1,50,000 | ||
| Salaries | 28,000 | ||
| Postage and Telegram | 4,000 | ||
| Insurance | 5,000 | ||
| Bad Debts | 3,000 | ||
| Rent | 4,000 | ||
| Discount | 3,000 | ||
| Drawings: | |||
| Meena 10,000 | |||
| Reena 5,000 | 15,000 | ||
| 15,14,000 | 15,14,000 | ||
Adjustments:
1. Stock on hand on 31st March 2013 was valued at Rs. 1,10,000.
2. Depreciate plant and machinery at 10% p.a.
3. Create reserve for doubtful debts at 5% on sundry debtors.
4. Salaries include Rs. 2,500 as advance to workers.
5. Partners are allowed interest at 5% p.a. on their capitals.
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| Balance Sheet as on 31st March 2012 | |||
| Liabilities | Amount (Rs) | Assets | Amount (Rs) |
| Sundry Creditors | 15,000 | Cash at bank | 3,000 |
| Uday’s Wife’s Loan | 30,000 | Debtors 67,500 | |
| Capital A/c | (–) R.D.D. 7,500 | 60,000 | |
| Uday | 1,38,000 | Stock | 135000 |
| Prabhakar | 90,000 | Machinery | 45000 |
| Furniture | 30000 | ||
| 2,73,000 | 2,73,000 | ||
The assets were realised as under:
Goodwill Rs. 15,000, Stock Rs. 1,20,000 and Debtors Rs. 54,000.
Machinery was taken over by Prabhakar at Rs. 40,000 and furniture by Uday at book value.
Uday agreed to discharge his wife’s loan.
The creditors were paid at a rebate of Rs. 3,000
The expenses of dissolution amounted to Rs. 6,000
Pass necessary Journal Entries in the books of the firm.
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| Balance Sheet as on 31st March 2012 | |||
| Liabilities | Amount (Rs) | Assets | Amount (Rs) |
| Sundry Creditors | 15,000 | Cash at bank | 3,000 |
| Uday’s Wife’s Loan | 30,000 | Debtors 67,500 | |
| Capital A/c | (–) R.D.D. 7,500 | 60,000 | |
| Uday | 1,38,000 | Stock | 135000 |
| Prabhakar | 90,000 | Machinery | 45000 |
| Furniture | 30000 | ||
| 2,73,000 | 2,73,000 | ||
The assets were realised as under:
Goodwill Rs. 15,000, Stock Rs. 1,20,000 and Debtors Rs. 54,000.
Machinery was taken over by Prabhakar at Rs. 40,000 and furniture by Uday at book value.
Uday agreed to discharge his wife’s loan.
The creditors were paid at a rebate of Rs. 3,000
The expenses of dissolution amounted to Rs. 6,000
Pass necessary Journal Entries in the books of the firm.
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Jitesh and Lailesh are in partnership sharing profits and losses in the ratio of 2:1. From the following Trial Balance and adjustments given below, you are required to prepare Trading and Profit and Loss A/c for the year ended 31st March 2013 and the Balance Sheet as on that date:
| Trial Balance as on 31st March 2013 | ||
| Particulars | Debit Amount (Rs) | Credit Amount (Rs) |
| Prepaid Insurance | 800 | |
| Insurance | 2,000 | |
| R.B.D.D. | 1,000 | |
| Discount | 800 | |
| Postage and telephone | 3,200 | |
| Salaries | 56,000 | |
| Debtors and Creditors | 66,000 | 68,000 |
| Wages | 24,000 | |
| Opening Stock | 48,000 | |
| Carriage | 1,000 | |
| Purchases and Sales | 1,93,200 | 3,01,600 |
| Return inwards and outwards | 5,600 | 9,200 |
| Bank overdraft | 1,20,800 | |
| Plant & Machinery | 24,000 | |
| Land & Building | 1,76,000 | |
| Capital | ||
| Jitesh | 52,000 | |
| Lailesh | 48,000 | |
| Total | 6,00,600 | 6,00,600 |
2. Goods worth Rs. 4,000 were distributed as free samples.
3. Closing stock on 31.03.2013 was valued at the cost Rs. 56,000 while its market price was Rs. 60,000.
4. Salaries were outstanding Rs. 2,000.
5. Depreciate:
Plant & Machinery @ 10% p.a.
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what is trial balance ?
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Give the word/term/phrase which can substitute the following statement.
Assets which are not recorded in the books of account.
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Give the word/term/phrase which can substitute the following statement.
Assets which are not recorded in the books of account.
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The person in whose favour the bill is transferred.
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If any unrecorded liability is paid on dissolution of the firm ___________ is debited.
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If any unrecorded liability is paid on dissolution of the firm ___________ is debited.
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State true or false with reason.
Gross Profit depends upon Net Sales.
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State true or false with reason.
Gross Profit depends upon Net Sales.
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