Maintain the provision for doubtful debts

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Reference no: EM13528244

From the following Trial Balance of Mr. Reddy, you are required to prepare Trading and Profit and Loss Account for the year ended on Mar 31, 2009 and a Balance Sheet on that date:


Debit Balance

Credit Balance

Particulars

Rs

Rs

Capital

-

1,00,000

Drawings

12,000

-

Sundry Creditors

-

40,000

Cash-in-hand

5,000

-

Cash-at-bank

11,600

-

Sundry Debtors

51,000

-

10% Loan (taken on Sep 1, 2008)

-

20,000

Provision for Doubtful Debts

-

4,000

Furniture

12,000

-

Machinery

28,400

-

Stock (Apr 1, 2008)

80,000

-

Purchases

1,80,000

-

Rent and Taxes

6,800

-

Salaries

18,000

-

Manufacturing Wages

25,000

-

Sales

-

2,80,800

Sundry Expenses

2,000

-

Insurance (including a premium of Rs 600 per annum paid Sep 30, 2009)

800

-

Commission

-

1,400

Carriage

4,000

-

Travelling Expenses

1,600

-

Bills Receivable

8,000

-


4,46,200

4,46,200

Adjustments

  1. Stock on Mar 31, 2009 was Rs 76,000
  2. Write off bad debts Rs 1,000 and maintain the provision for doubtful debts at 5% on debtors
  3. Manufacturing wages include Rs 1,600 for erection of new machinery on Mar 1, 2009
  4. Depreciate machinery by 5% and furniture by 10%

Reference no: EM13528244

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