3 400 965 Date Particulars Petty Cash Expenses Dr. To Petty Cash Alc 400 (Being the adjustment for petty cash expenses) Net Effect (1) Petty cash expenses of 10,000 & 9,600 +2 400) will be debited to profit and Loss Account (2) Petty cash of 600 1,000 - 400) will be shown in the Balance Sheet. Illustration 21 From the following balances extracted from the books of a trader on December 31, 2016, prepare a Trading and Profit and Loss Account for the year ended on that date and also a Balance Sheet as on the same day: Particulars Particulars Cash in hand 480 Capital Account 42,500 Drawings 7,100 Sales 1,19,060 Plant and Machinery 9,500 Purchases Retur 2,910 Stock in Trade 14,600 Bank Overdraft 1,200 Purchases 1,03,620 Creditors 10.000 Sales Retum 2.100 Provision for Doubtful Debts 1.050 General Expenses 2,000 Wages 2,400 Rent and Rates 3,200 Bad Debts 1,720 Debtors 30,000 1,76,720 1,76,720 Note: (a) Provide 10% depreciation on plant and machinery. (b) Provision for doubtful debts is to be increased to 5% of debtors. (c) A credit sale of 2,000 has not been recorded in the books. (d) Plant and machinery worth ? 1,000 purchased during the year (on September 30, 2016) has been included in Purchases. (e) Rent paid in advance 800. (1) Stock on December 31, 2016 was valued at 2 17,300. These does not include the value of the machinery bought on 30.9.2016, (g) Wages include