[CBSE] Q 7 Solutions Adjustments in Preparation of Financial Statements TS Grewal Class 11 (2022-23)

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Are you looking for the solution of Question number 7 of the Adjustments in Preparation of Financial Statements of TS Grewal Book class 11, 2022-23?

Following are the balances extracted from the books of Narain on 31st March, 2022:

ParticularsParticulars
Narain’s Capital
Narain’s Drawings
Furniture and Fittings
Bank Overdraft
Creditors
Building
Stock on 1st April, 2021
Debtors
Rent from Tenants
Purchases
3,00,000
50,000
26,000
42,000
1,38,000
2,00,000
2,20,000
1,80,000
10,000
11,00,000
Sales
Sales Return
Discount (Dr.)
Discount (Cr.)
Insurance
General Expenses
Salaries
Commission (Dr.)
Carriage on Purchases
Bad Debts written off
15,00,000
20,000
16,000
20,000
20,000
40,000
90,000
22,000
18,000
8,000

Additional Information:

(i) Closing Stock at cost as on 31st March, 2022 was ₹ 2,00,600, whereas its Net Realisable Value (Market Value) was ₹ 2,05,000.

(ii) Depreciate: Building by ₹ 3,000 and Furniture and Fittings by ₹ 2,500.

(iii) Make a provision of 5% on debtors for doubtful debts.

(iv) Carry forward ₹ 2,000 for unexpired insurance.

(v) Outstanding salary was ₹ 15,000.

Prepare Tarding and Profit & Loss Account for the year and Balance Sheet as at that date.

[Gross Profit – ₹ 3,42,600; Net Profit – ₹ 1,49,100; Balance Sheet Total – ₹ 5,94,100.]

[Hints: 1. Closing Stock will be taken at ₹ 2,00,600, being lower of Cost and Net Realisable Value (Market Value) following the Prudence Concept)

2. ₹ 2,000 out of Insurance Expenses are prepaid insurance.]

Solution:-

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19Question – 19
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