From the following Trial Balance of Rasika and Diksha, you are required to prepare Trading and Profit and Loss Account for the year ended 31st March, 2022 and Balance Sheet as on that date :Trial Balance as on 31st March, 2022Debit BalanceAmount (₹)C…

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Q.7 From the following Trial Balance of Rasika and Diksha, you are required to prepare Trading and Profit and Loss Account for the year ended 31st March, 2022 and Balance Sheet as on that date : Trial Balance as on 31st March, 2022 Debit BalanceAmount (₹)Credit BalanceAmount (₹) Stock (1.4.2021)30,800Capital Accounts : Purchases80,000Rasika80,000 Salaries6,800Diksha80,000 Wages10,500Sundry Creditors30,500 Royalties3,200Interest Received on Fixed Deposit1,000 Printing and Stationery4,500Sales1,20,000 Sundry Debtors43,000 Furniture20,200 Investments40,000 Advertisement (For 3 years)30,000 Bad debts500 Cash in hand27,000 Fixed Deposit15,000 Total3,11,500Total3,11,500 Adjustments : Interest on fixed deposits ₹ 1,200 is still receivable. Furniture to be depreciated by 5% p.a. 2.5% reserve for doubtful debts on Sundry Debtors to be provided. Closing Stock was valued at cost price ₹ 40,000 and Market price ₹ 35,000.

Doubtly AI · Accepted Answer

Answer: Gross profit ₹ 30,500; Net profit ₹ 8,815 (₹ 4,407.50 to each partner); Balance Sheet total ₹ 1,99,315. Notes: (i) Closing stock is valued at cost or market price, whichever is lower: ₹ 35,000. (ii) Advertisement of ₹ 30,000 is for 3 years, so 1/3 = ₹ 10,000 is charged this year and ₹ 20,000 is carried forward as an asset (deferred revenue expenditure). (iii) Royalty is a direct expense. (iv) No partnership agreement is given, so profit is shared equally. Trading Account of Rasika and Diksha for the year ended 31st March, 2022 Dr. ParticularsAmount (₹)Cr. ParticularsAmount (₹) To Opening Stock30,800By Sales1,20,000 To Purchases80,000By Closing Stock (lower of cost ₹ 40,000 and market ₹ 35,000)35,000 To Wages10,500 To Royalties3,200 To Gross Profit c/d30,500 Total1,55,000Total1,55,000 Profit and Loss Account for the year ended 31st March, 2022 Dr. ParticularsAmount (₹)Cr. ParticularsAmount (₹) To Salaries6,800By Gross Profit b/d30,500 To Printing and Stationery4,500By Interest on Fixed Deposit 1,000 + receivable 1,2002,200 To Advertisement (30,000 × 1/3)10,000 To Bad debts 500 + R.D.D. 1,075 (2.5% of 43,000)1,575 To Depreciation on Furniture (5% of 20,200)1,010 To Net Profit transferred to : Rasika’s Capital A/c4,407.50 Diksha’s Capital A/c4,407.50 Total32,700Total32,700 Balance Sheet of Rasika and Diksha as on 31st March, 2022 LiabilitiesAmount (₹)AssetsAmount (₹) Capital Accounts :Sundry Debtors 43,000 less R.D.D. 1,07541,925 Rasika 80,000 + Profit 4,407.5084,407.50Furniture 20,200 less Depreciation 1,01019,190 Diksha 80,000 + Profit 4,407.5084,407.50Investments40,000 Sundry Creditors30,500Advertisement (unexpired, 2 years)20,000 Closing Stock35,000 Fixed Deposit15,000 Interest receivable on F.D.1,200 Cash in hand27,000 Total1,99,3151,99,315

From the following Trial Balance of Rasika and Diksha, you are required to prepare Trading and Profit and Loss Account for the year ended 31st March, 2022 and Balance Sheet as on that date :Trial Balance as on 31st March, 2022Debit BalanceAmount (₹)C…

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Debit Balance	Amount (₹)	Credit Balance	Amount (₹)
Stock (1.4.2021)	30,800	Capital Accounts :
Purchases	80,000	Rasika	80,000
Salaries	6,800	Diksha	80,000
Wages	10,500	Sundry Creditors	30,500
Royalties	3,200	Interest Received on Fixed Deposit	1,000
Printing and Stationery	4,500	Sales	1,20,000
Sundry Debtors	43,000
Furniture	20,200
Investments	40,000
Advertisement (For 3 years)	30,000
Bad debts	500
Cash in hand	27,000
Fixed Deposit	15,000
Total	3,11,500	Total	3,11,500

Dr. Particulars	Amount (₹)	Cr. Particulars	Amount (₹)
To Opening Stock	30,800	By Sales	1,20,000
To Purchases	80,000	By Closing Stock (lower of cost ₹ 40,000 and market ₹ 35,000)	35,000
To Wages	10,500
To Royalties	3,200
To Gross Profit c/d	30,500
Total	1,55,000	Total	1,55,000

Dr. Particulars	Amount (₹)	Cr. Particulars	Amount (₹)
To Salaries	6,800	By Gross Profit b/d	30,500
To Printing and Stationery	4,500	By Interest on Fixed Deposit 1,000 + receivable 1,200	2,200
To Advertisement (30,000 × 1/3)	10,000
To Bad debts 500 + R.D.D. 1,075 (2.5% of 43,000)	1,575
To Depreciation on Furniture (5% of 20,200)	1,010
To Net Profit transferred to :
Rasika’s Capital A/c	4,407.50
Diksha’s Capital A/c	4,407.50
Total	32,700	Total	32,700

Liabilities	Amount (₹)	Assets	Amount (₹)
Capital Accounts :		Sundry Debtors 43,000 less R.D.D. 1,075	41,925
Rasika 80,000 + Profit 4,407.50	84,407.50	Furniture 20,200 less Depreciation 1,010	19,190
Diksha 80,000 + Profit 4,407.50	84,407.50	Investments	40,000
Sundry Creditors	30,500	Advertisement (unexpired, 2 years)	20,000
		Closing Stock	35,000
		Fixed Deposit	15,000
		Interest receivable on F.D.	1,200
		Cash in hand	27,000
Total	1,99,315		1,99,315