From the following Trial Balance of Abha Company, prepare Profit and Loss Account and Balance sheet for the year ended December 31, 2003. TRIAL BALANCE Particulars Capital Debit (Rs.) Credit (Rs.) 2,50,000 Inventory (on Jan. 1, 2003) Accounts Receivable 60,000 1,00,000 Accounts Payable 70,000 Sales 6,00,000 Sales Returns 20,000 Purchases 3,70,000 Purchase Returns 10,000 Discount allowed by creditors 10,000 Bills Payable 40,000 Rent Received 10,000 Insurance 10,000 Drawings 20,000 Land and Buildings 1,50,000 Freehold property 50,000 Office Equipment 50,000 Petty Expenses 6,000 Cash at Bank 20,000 Furniture 30,000 Freight 20,000 Wages 15,000 Salaries 15,000 Advertising 10,000 Postage and Telephones 10,000 General Expenses 34,000 TOTAL 9,90,000 9,90,000 Adjustments: iii) iv) v) vi) vii) viii) ix) Inventory was valued on December 31,2003 at Rs.95,000 Depreciate Office Equipment at 15% and Furniture at 10% Provide for Interest on capital at 10% and Interest on Drawings at 6% Provide for following outstanding expenses: Wages Salaries General Expenses Rs.10,000 Rs. 7,000 Rs. 5,000 Insurance was prepaid to the extent of Rs.3,000 A sum of Rs.2,000 was allowed by way of discount on purchases but not yet accounted for. A sum of Rs.3,000 represents rent received in advance. A provision of 2% is required on Debtors towards bad and doubtful debts. A provision of 30% towards taxation on profits (before taxation) is required. PROBLEM 6 4