FINANCIAL STATEMENT

Given:

The following balances have been taken from the pre-closing Trial Balance prepared from the ledger of Mr. Bazil on Dec.

31,2003.

DEBIT BALANCE

Cash Rs. 48,000.

Account Receivables (1,1,2003) Rs. 1,40,000.

Merchandise Inventory (1,1,2003) Rs. 70,000.

Office Supplies Rs. 5,000.

Furniture Rs. 50,000.

Purchases Rs. 2,00,000.

Salaries Expanses Rs. 3,500.

Prepaid Insurance Rs. 2,000.

Rent Expenses Rs. 4,200.

Total Rs. 5,22,700.

CREDIT BALANCE

Account Payable Rs. 22,700.

Sales Rs. 3,40,000.

Purchases return Rs. 10,000.

Unearned fee Rs. 10,000.

Bazil-Capital Rs. 1,40,000.

Total Rs. 5,22,700.

DATA FOR ADJUSTMENTS:

1) Insurance expired by Rs. 1,500.

2) Fee earned Rs. 7,000.

3) Depreciation expenses on furniture Rs. 5,000.

4) Salaries expanses for the year Rs. 4,200.

5) Rent expense for the year Rs. 3,500.

6) Office supplies on hand Rs. 2,000.

7) Merchandise Inventory on Dec.31,2003 Rs. 80,000.

REQUIRED:

i) Prepare Income Statement for the year ended Dec. 31,2003. ii Prepare classified balance Sheet as of Dec. 31,2003.