2006



3. The following is the trial balance of Metropolitan Company (Private) Limited as on June 30, 2005:
Particulars Debit Credit
Plant & Machinery ------------------------------------------------ 375,000
Wages ---------------------------------------------------------------- 90,000
Vehicles -------------------------------------------------------------- 71,000
Furniture and Fixtures ---------------------------------------------- 30,000
Carriage inward ------------------------------------------------------- 5,000
Carriage outward--------------------------------------------------- 6,250
Freehold Land ---------------------------------------------------- 75,000
Purchasing expenses --------------------------------------------- 28,750
Insurance ------------------------------------------------------------ 6,250
Rates and taxes --------------------------------------------------- 25,000
Office supplies ----------------------------------------------------- 5,750
Electricity --------------------------------------------------------- 48,500
Salaries ------------------------------------------------------------ 40,000
Opening stock ---------------------------------------------------- 56,750
Purchases -------------------------------------------------------- 325,000
Sales return --------------------------------------------------------- 8,250
Discount -------------------------------------------------------------3,000
Bad debts ----------------------------------------------------------- 4,375
Mark-up & bank charges ----------------------------------------- 5,625
Cash in hand ------------------------------------------------------- 7,125
Short term deposit ----------------------------------------------- 50,000
Repairs & maintenance ----------------------------------------- 14,500
Postage, telegram & telephone ---------------------------------- 5,000
Sundry debtors -------------------------------------------------- 116,100
Capital ----------------------------------------------------------- 500,000
Investment -------------------------------------------------------- 37,500
Sales ------------------------------------------------------------- 795,000
Purchases return --------------------------------------------------10,750
Sundry Creditors -------------------------------------------------61,600
Bank Overdrafts ------------------------------------------------- 29,375
Reserve for doubtful debt ----------------------------------------7,500
Discount & Commission ---------------------------------------- 4,250
Interest received -------------------------------------------------- 3,125
Dividend income ------------------------------------------------- 5,625
1,417,225 1,417,225

The following adjustments are required to be made into the accounts:
(1) Closing stock Rs. 73,000.
(2) Depreciation to be provided at following rates:
(a) Freehold land ------------------------------------- 5%
(b) Vehicles ------------------------------------------ 20%
(c) Other assets ------------------------------------- 10%
(Plant & Machinery and furniture and Fixtures)
(3) Reserve for doubtful debt is required to be kept at 5% of the debtors balance.
(4) Prepaid insurance Rs. 1,500 and rates & taxes – Rs. 375
(5) Outstanding wages Rs. 3,000 and salary Rs. 8, 375
Required:
Prepare trading profit and loss account and balance sheet as at 30-06-2005.

I will solve this question by tomorrow Inshahallah.

__________________
"Strength does not come from winning. Your struggles develop your strengths. When you go through hardships and decide not to surrender, that is strength".Key to Success.......