Practice Questions Merchandising Periodic Inventory System:

Question 1:

Following is the pre-closing trial balance of Chaudry and Chaudry Traders as on June 30, 2002.

Debit balances		Credit balances
Cash	Rs. 65000	Accounts Payable	Rs. 5000
Accounts Receivables	25000	Capital	175000
Merchandise (July 1, 2001)	15000	Sales	150000
Prepaid Insurance	6000	Purchases Discount	8000
Office Supplies	5000	Purchases Returns and Allowance	20000
Furniture	25000	Unearned Commission	2000
Equipment	40000	Allowance for depreciation -
Drawings	4000	Furniture	10000
Sales Discount	9000	Allowance for Depreciation -
Sales Return and Allowances	11000	Equipment	10000
Purchases	165000
Carriage-in	10000
Salaries Expense	25000
Rent Expense	15000
Miscellaneous Expense	5000

Additional data for adjustment:

a. Ending Inventory is valued at Rs. 65000.

b. Estimated Depreciation on plant assets is @10%.

c. Unearned Commission is Rs.500.

d. Office Supplies is unused Rs. 1100.

e. Actual Salaries expense for the year is amounting to Rs. 32500.

f. Actual Rent Expense for the year is amounting to Rs. 13500.

Required:

1. Prepare Income Statement.

2. Prepare Statement of Owners Equity.

3. Prepare Balance Sheet.

4. Prepare Closing Entries.

5. Prepare Post Closing Trial Balance.