Balance Sheet as at March 31, 2006 Liabilities Amount Assets Amount Rs. Rs. Creditors 60,610 Cash 20,000 Outstanding salaries 1,600 Debtors 60.000 Loan 40.000 Less Bad debts (800) Outstanding interest 2.400 Less Provision 2.960 56.240 Capital 75,000 Prepaid rent 1.000 Add Net profit 14.280 89,280 Unexpired insurance 600 Machinery 32.000 Add Erection 4.000 Wages 36.000 Less Depreciation (1.8001 34.200 Closing stock 81.850 1.93.890 1.93.890 Hlustration 8 From the following balance extracted from the books of of M/s Hariharan Brother, you are require to prepare the trading and profit and loss account and a balance sheet as on December 31. 2005 Debit balance Amount Credit balance Amount Rs. Rs. Opening stock 16.000 Capital 1,00.000 Purchases 40,000 Sales 1.60.000 Return inwards 3,000 Return outwards 800 Carriage inwards 2,400 Apprenticeship premium 3.000 Carriage outwards 5.000 Bills payable 5,000 Wages 6,600 Creditors 31.600 Salaries 11.000 Rent 2.200 Freight and Dock 4.800 Fire Insurance premium 1.800 Bad debts 4.200 Discount 1,000 Printing and Stationery 500 Rates and Taxes 700 Travelling expenses 300 Trade expenses 400 Business premises 1.10.000 Furniture 5,000 Bills receivable 7.000 Debtors 40.000 Machine 9,000 Loan 10,000 Investment 6.000 Cash in hand 500 Cash at bank 7.000 Proprietor's withdrawals 6.000 3,00,400 3.00,400 c7 Adjustments 1. Closing stock Rs. 14,000. 2. Wages outstanding Rs. 600. Salaries Outstanding Rs. 1,000, Rent outstanding Rs. 200. 3. Fire Insurance premium includes Rs. 1,200 paid in July 01, 2005 to run for one year from July 01, 2005 to June 30, 2006. 4. Apprenticeship Premium is for three years paid in advance on January 01. 2005