1. Both Sales and Sundry Debtors have been reduced by Rs 75,000 representing invoice value of goods sent on approval Rs 50,000 have been added to the closing stock being the cost of goods sent on approval. 2. Last year's short provision for Printing and Stationery has not been charged to the current year's Profit & Loss Account. It is preferable to charge it directly to in Capital Account 3. Sundry Debtors = Rs 5,00,000 - (Rs 75,000 Goods on Approval + Rs 25,000 Bad Debt) = Rs 4,00,000 Illustration 6.28. The Trial Balance of Jagfay Corporation, New Delhi, as on 30.9.1999 is as below: Particulars Amount Rs Capital Account (including Rs 5,000) (Introduced on 1.4.1999) 22.500 Stock as on 1.10.1998 Finished Goods 3,500 Work-in-progress 7,000 Raw Materials 3.000 13,500 Purchase of Raw Material 70.500 Machinery 22,500 Sales 1.26.225 Carriage Inwards 750 Carriage Outwards Rent (including Rs 450 for the factory premises) 1.350 Rebates and Discounts allowed 105 Fire Insurance (for machinery) 210 Sundry Debtors 18.900 Sundry Creditors 5.100 450 j54 300 600 Reserve for Bad and Doubtful Debts 60 Printing and Stationery 180 Miscellaneous Expenses 840 Advertisement 4,500 Drawings of Proprietor 1.800 Office Salaries 5,400 Manufacturing Wages 6.000 Furniture and Fixtures 2.250 Factory Power and Fuel Cash in hand Balance with Bank of Bikaner Ltd., Delhi (Dr.) 3,750 Adjustments (1) Provide for interest @ 10% per annum on Capital (No interest on drawings need be provided.) (it) A motor car purchased on 1.4.1999 for Rs 6,000 has been included in "Purchases'' (iii) Provide depreciation: Machinery @ 10% p.a., Motor Car @ 20% p.a., Furniture and Fixtures @ 10% p.a. (iv) Provision for unrealized rent in respect of a portion of the office sublet at Rs 50 per month from 1.4.1999 has to be made. () Sundry Debtors include bad debts of Rs 400 which must be written off. (vi) Provision for Bad and Doubtful Debts as on 30.9.1999 should be maintained at 10% of the Debtors. (vii) A sum of Rs 2,000 transferred from the Current Account with Bank of Bikaner Ltd., to Fixed Deposit Account on 1.2.1999 has been passed through books. Make suitable adjustments and provide for accrued interest @ 6% p.a. (viii) Stock as on 30.9.1999, Finished Goods Rs 5,000, Raw Materials Rs 1,000, Work-in-progress Rs 5,500. Prepare the Manufacturing, Trading and Profit and Loss Account for the year ended 30.9.1999 and Balance Sheet as on that date after making the necessary adjustments (Journal entries are not required.)