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Please answer this accounting question. I have a very important exam and no matter how many times I try my balance sheet doesnt tally, and
Please answer this accounting question. I have a very important exam and no matter how many times I try my balance sheet doesnt tally, and the profit and loss also seems wrong. PLEASE EXPAND on everything, how did you arrive at the cash total for current assets? in the previous answers there was a cash total, i can't figure out how it was a total of as i am not getting that sum. Please i beg expand on everything, it is a very important exam. Paras Modi, an innovator, created a working model of a new and improved commercial paint spray, which he had patented. The patent had a legal life of years. Modi was eager to exploit his patent commercially. He started Paras Industries to produce paint spray on April by investing INR in capital out of which INR has been contributed as cash and for the remaining capital he transferred his patent to the newly incorporated firm. On April he applied for a bank loan of INR from ICICI Bank and his loan was approved and received on April At the same time, he took one old building on a year rental contract. As per the contract, fiveyear rent of INR was to be paid upfront. After five years contract would be renewed. The agreed rent amount of INR was paid in cash on April In order to establish its first plant, he purchased equipment of INR from Universal Machinery on a credit basis. An amount of INR was paid in cash for the installation of the equipment. Subsequently, he purchased chemicals and other raw materials costing INR from the newly explored suppliers in Ahmedabad for cash. He also purchased office supplies for INR for cash on April He hired production managers on May on a monthly salary of INR to be paid on the last day of every month. On the same day, he also hired two helpers on a monthly salary of INR each. On June he took a shortterm bank loan of INR for working capital needs. The shortterm loan was repaid on September with an interest amount of INR In July Paras Modi got his first order of paint spray for INR He delivered the order in the month of August to Apex Company and received the cash in return. Paras Modi got his second order for supplying paint spray to Samagam Builder on February for INR He delivered the order on March and provided a credit period of days to the customer.
Following is the additional information available for his business during the year ending March :
Equipment was depreciated at the rate of per annum on a writtendown value basis.
Amortization on the Patent was INR for the year.
Inventory of chemicals and other raw materials was INR on March
Advertisement expenses incurred for marketing and promotion were INR for the year.
Tax applicable to the business is of net profit.
Modi paid an advance salary of INR for the month of April to the production manager on March
Telephone expenses paid INR for the year.
General, and administration costs, totalled INR paid for the year.
Inventory of office supplies was INR on March
On March Paras Modi had withdrawn INR from the business for his personal use.
Required:
A You are required to prepare the statement of profit and loss of Paras Industries for the year ending March
B You are required to prepare the Balance Sheet of Paras Industries as on March
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