373 FINAL ACCOUNTS
Balance Sheet of Mr. Sudhir as on 31st March 1994 Libilities
S.Credltors Sudhir's loan Creditors for machinery Outstanding expenses: Interest on loan Other expenses Bills payable. . Capital: Balance as per T/B Add: Net profit
Less: Drawings In cash in goods Add: Adjustment for opening stock,
Amount Rs.
30,000 10,000 10,000
500 2,000
2,500 3,000 2,72,202
Assets
Cash In hand Cash at Bank Less: Cheque dishonoured S.Debtors Add: Dishonoured Cheque Dishonoured bill
1,50,000 1,08, 852 2,58,852
Amount Rs.
_
Provision for doubtful debts Bills Receivable Less: Dishonoured _ Machinery Add: Newly purchased Installation charges
2,000 5,000
_500 50,000
4,500
500 _300 50,800
less:
2,000 900 2,900 2,55,952 16,250
Less: Depcn. Furniture 18,000 Less: Depreciation Building Less: Depcn. Closing stock Balance as per T/B Add: Appreciation
3,27,702
2,540 10,000 300 80,000
48,260 9,700
10,000 300 10,300 90,300 8,258
82,042
6,200
1,800 1,00,000 10,000
90,000
60,000 15,000
75,000
3,27,702
Manufacturing Account Some films like to first ascertain the cost of goods manufactured by them during the year distinctly before they prepare the trading sccount and establish the gross profit. This account is called the Manufacturing Account and is prepared in addition to be Trading Account. It has the undermentioned characteristics: 1. Since the purpose of of preparation preparation of this account' account' is to ascertain the the cost of goods goods produced produced during during the year, the
448
Date
Consignment to Kanpur Account Amount Date Particulars
Particulars
s. Amount R
Rs.
1934 July1 Dec 31
To Goods sent on consignment A/c To Bank A/c expenses To Kanpur Agent Exp. To Kanpur Agent Commn. To Cons Consig ignm nmen entt stoc stock k reserve A/c loading To Profit & loss A/c. transfer
40,000
1994 1994 Dec. Dec. 31
1,500 2,500 1,860
By Kan Kanpu purr Agen Agentt 31,000 Sale Sale proc procee eeds ds 10,375 By Stock on 10,000 consign consignmen mentt A/c By Good Goods s sent sent on consi consign gnme ment nt A/c Loading
2,500 3,015
51,375
51,375
Goods Sent on Consignment Account Date
Particulars
1994 To Dec. 31 Consignment to Kanpur A/c adjustment Trading a/c transfer
Amount Rs. Date
1994 July 1
Particulars
Amount Rs.
By Consignment A/c
40,000
10,000 30,000 40,000
40,000
Kanpur Agent Account Date
Particulars
Amount
Date
Particulars
Amount
By Bills Receivable Account By Consignment to
15,000
Rs.
1994 Dec. 31
To Consignment to Kanpur A/c.
1994 July 1 31,000 Dec. 31
Kanpur A/c expenses By Commission By Bank A/c 31,000
2,500 1,860 11,640 31,000
449
Bills Receivable Account Date
Particulars
Amount
Date
Particulars
Amount
Rs.
1994 July 1
To Kanpur Agent:
Rs.
15,000
1994 July 1
By Bank Account Discount A/c
By
15,000
Bank Account (Inclusive) Date
Particulars
Amount
Date
Particulars
Amount
Rs.
1994 July 1 Dec. 31
Rs.
To Bill Receivable 14,700 Account To Kanpur 11,640 Agent
1994 July 1
By Consi Consign gnme ment nt Kanp Kanpur ur 1,500 Account
Discount Account Date
Particulars
Amount
Date
Particulars
Amount
Rs.
1994 July 1
Bill Bills s Account To
Rece Receiv ivab able le 300
Rs.
1994 Dec. 31
By Profi rofitt & Loss Acco ccount
300
Date
Particulars
300
Profit & Loss Account Date Amount Particulars Rs.
1994 Dec. 31
300
To Discount A/c 300
Amount Rs. 1994 By Consignment to Kanpur 3,015 Dec 31 A/c
Stock on Consignment Account Date
Particulars
Amount
Date
Particulars
Rs.
1994 To Consignment to Dec 31 Kanpur A/c
10,375
1978 Jan.1
10,375
To Balance b/d
Amount Rs.
1994 By Balance c/d Dec. 31
10,375
450 XXXXXXX 451 XXXXXXXXX
452
A TEXTBOOK OF ACCOUNTANCY Working Notes: Commission has been calculated as follows: 3\4 th of invoice of goods sent (Invoice value) 10%
Commission on this figure Excess value realized: Rs.19,500 Rs.15,000 = 4,500 20% 20% of excess value realized
15,000 1,500 900 2,400
Stock has been valued as: 1\4 th of goods left unsold 1\4th of Expenses Seema is not a del credere agent, hence the bad debt of Rs. 400 has to be borve by Arun. Illustration No. 12 Ram & Co. of Delhi sent on consignment to their agent in Calcutta goods invoiced invoiced at Rs. 45,000, this being selling price of the consignment obtained by adding 30% to the cost price to cover expenses, profit and selling commission. At the end of six months the agent remitted the sum of Rs. 12,000 made as under:
Proceeds of goods sold Less: 5% commission 650 Expenses 350 Net proceeds 13,000 1,000 12,000 The agent reported the goods of the invoice value of Rs, 600 have been totally damaged in transit, and he sent a list of stock still held amounting TO Rs. 31.400. Give the journal eateries necessary t record these details in the books of consignor, and also the ledger accounts. 453
Solution IN THE BOOKS OF RAM & CO Consignor Date
Particulars
CONSIGNMENT ACCOUNT L. F.
Debit Rs.
Consignment to Calcutta A/c. Dr. To Goods sent on Consignment A/c. (Being goods sent on consignment to Calcutta) Profit & Loss A/c Dr. To Consignment to Calcutta A/c (Being the amount of Ioss-intransit at invoice price at Rs.600) Dr. Consignee's personal A/c To Consignment to Calcutta A/c Being the amount of sales proceeds) Consignment to Calcutta A/c Dr. To Consignee's Personal A/c. (Being the amount of consignee expenses & commission)
45,000
464
13,000
1,000
Credit P.
Amount Rs.
P.
45,000
00
161
54
13,000
00
1,000
00
00
54
00
00
Consignment stock account A/c To Consignment to Calcutta A/c. (Being the invoice value of closing stock) Consignment to Calcutta A/c Dr. To Consignment stock rese reserv rve e A/c. A/c. (Bei (Being ng the the diff differ eren ence ce between
invoice price and actual price) Goods sent on consignment A/c To Consignment to Calcutta (Being the difference in the value of goods sent on consignment between invoice price and actual price) Consignment to Calcutta A/c. . To Profit & Loss A/c. (Being the amount of profit transferred to Profit & Loss Account)
31,400
7 ,246
2,000
00 31,400
00
7,246
15
10,384
61
15
00 2,000
