Financial Accounting – Induction
Identify the type of Account in the following Cases: -
1. Cash Account2. Proprietor’s Capital Account3. Friend’s Club Account4. Goods Account5. Discount Received Account6. Discount Allowed Account7. Commission Paid Account8. Land & Building Account9. Bank of India Current Account10. Traveling Account11. Plant & Machinery Account12. Drawings Account (Owner’s funds withdrawal from
Business)13. Bad Debts Account14. Creditors Account15. Printing & Stationery Account16. Ghatge Patil Account17. Carriage Outward Account18. Municipal Taxes Account19. Kirloskar Company’s Account20. National Dairy Development Board’s Account21. Invest in Fixed Deposits of State Bank of India22. Patents Account23. Loan to Mrs. Soman Account24. Gold Account25. Purchase Account26. Sales Account27. Rates & Taxes Account28. Repairs to Machinery Account29. Dividend Received Account30. Investment in Shares of XYZ Ltd.
Financial Accounting – Induction
Analyse the following Transactions regarding the effects, Accounts affected, Type of Accounts and the Debit & Credit Effect.JV – 1Also Pass the Journal Entries for the same: -
Write the Books of Accounts for Business started by Ganesh
1. Ganesh started business with Cash Rs. 5,000/- & Furniture Rs. 2,000/-
2. Purchased goods from Mahesh stores Rs. 1,500/- one month’s credit
3. Deposited Rs. 3,000/- in Bank of India Account
4. Sold goods for Cash for Rs. 500/-
5. Purchased stationery from Laxmi Stores for Cash Rs. 200/-
6. Sold goods to Devi on credit Rs. 200/-
7. Purchased goods from Abraham for Rs. 2,000/- half amount paid in cash and balance on credit for two months
8. Purchased machinery on credit from Kirloskar & co. Rs. 4,000/-
9. Paid to Mr. Dalal Rs. 150/ -, Rent towards Ganesh’s residential flat
10. Paid to Mr. Ram as commission by cheque of Bank Rs. 100/-
11. Withdrawn Rs. 500 from the Bank Account
12. Paid conveyance charges for official work to Mr. Ganesh
13. Ganesh introduced further capital of Rs. 10,000
14. Purchased goods from Mr. Madhu of three month credit Rs. 7,500
15. Sold these goods to Ramesh for Rs. 15,000 by receiving one third in cash and balance by cheque, the cheque was deposited in Bank.
Financial Accounting – Induction
JV - 2
Also Pass the Journal Entries for the same: -
Write the Books of Accounts for Business by Ashok Kamat for the month of February’04
1. Commenced business with cash Rs. 5,000 and Machinery 3,000
3. Bought goods from Deepak on Credit for Rs. 5,250
4. Sold goods for Cash Rs. 1,270
5. Paid into Bank Rs. 2,000
7. Purchase furniture against cheque Rs. 700
9. Sold goods to Anand Rs. 920
14. Sold goods for cash Rs. 1,590
16. Paid to Deepak on account Rs. 1,000
19. Paid for Life Insurance premium Rs. 280
21. Paid to Ramanand for Commission Rs. 150
23. Received from Anand Rs. 900 in full & Final settlement
25. Purchase Shares of Tata co. Rs. 500 and paid by cheque
27. Paid telephone bill of office Rs. 320
28. Paid to Deepak Rs. 4,200 in Full settlement
Financial Accounting – Induction
JV - 3Journalise the following Transactions
Record the following transactions in the books of Vinod for April’ 04
1. Started business with cash Rs. 25,000
2. Bought goods from Sachin at 5 % Trade Discount Rs. 5,000/-
4. Paid to Sanjay for office Rent Rs. 1,000
7. Sold goods for cash Rs. 700
9. Returned goods to Sachin Rs. 500 (gross)
12. Sold goods to Pravin at 5 % Trade Discount for Rs. 1,500
17. Paid to Sachin on Account Rs. 1,500
20. Sold goods for cash Rs. 400
22. Received from Pravin Rs. 1,400
25. Paid Salaries in Cash Rs. 1,200
26. Placed order for goods of Rs. 10,000 to Roy to execute next month
27. Purchased typewriter of Rs. 3,000 and paid Rs. 200 for Octroi
28. Goods purchased for cash Rs. 1,000
29. Distributed free samples Rs. 200
30. Paid to Sachin Rs 2000 on account
Financial Accounting – Induction
JV - 4
Journalise the following in the books of Shri.Gandhi for the month of August 1991
1. Commenced business with cash Rs.15000 and goods Rs. 7000
3. Bought goods for cash Rs. 1500
4. Sold goods for cash Rs. 1470
6. Deposited into bank Rs. 5000 in Dena Bank and opened Bank A/C
8. Purchased furniture Rs. 1800 and paid for it by cheque
12. Paid to taxes and insurance Rs. 350
15. Sold goods to Mr. Mehta Rs. 3000 at 5% trade discount
17. Bought goods from Shri. Gupta Rs. 5000 at 10% trade discount
22. Received from Shri. Mehta Rs 2500 on account and supplied him goods worth Rs. 1200
25. Paid to Shri. Gupta Rs.4000 on account
27. Goods worth Rs. 200 were distributed as free samples
29. Sold to Mr. Mehta worth Rs. 500 & paid Rs. 30 on his behalf
30. Paid for salaries and wages Rs. 820
Financial Accounting – Induction
JV - 5
Journalise the following Transactions for Sep 04
1. Sadanand borrowed Rs. 20,000 from his friend Atmanand and started business with that money.
2. Purchase goods from Premanand Rs. 7,000 at 10% Trade discount and paid half of the amount to earn 5% cash discount
3. Brought personal furniture for office use Rs. 5,000. Repaired the same for use by spending Rs.750
5. Sold goods for cash Rs. 350
7. Sivanand’s order of goods for Rs. 500 was executed and paid cartage of Rs. 40 on his behalf
9. Paid for shares purchased Rs. 2000 and brokerage Rs. 200
13. Paid office rent Rs. 900
15. Bought goods for cash Rs. 3,500
17. Sold goods to Shankaranand for Rs. 1,600 one month’s credit
19. Shankaranand returned goods worth Rs. 150
21. Paid Baste & Co. for advertisement Rs. 500
25. Paid life insurance premium Rs. 300 and premiun for office insurance policy Rs. 500
30. Paid telephone charges Rs. 210
Financial Accounting – Induction
Ledger preparation - 1
Journalise the following entries in the Books of Shankar & post them in proper Ledger accounts and balance the Ledger Accounts in March’04
1. Stated business with cash Rs. 10,000
2. Bought goods on credit from Vishnu Rs. 4,300
4. Sold goods for cash Rs. 620
5. Returned goods to Vishnu Rs. 150
7. Paid for salaries Rs. 800
10 Sold goods to Anant Rs. 1,700 one month’s credit
12. Bought goods for casg Rs. 500
15. Paid Vishnu Rs. 2,500 on account & further purchase Rs. 1,500
20. Received from Anant Rs. 1,500
22. Sold goods to Anant Rs. 1,540
25. Sold goods for cash Rs. 450
27. Paid for office rent Rs. 300
30. Withdrew for house hold expenses Rs. 250
31. Stock of goods on hand Rs. 3000
Financial Accounting – Induction
Ledger Preparation - 2
Enter following transactions in the ledger accounts and balance them
1. Mr. Rawal started business - cash Rs. 25,000 & furniture Rs. 5,000
3. Purchase motorcycle for business purpose Rs. 15,000 and the amount borrowed from Bank of Baroda
4. Bought goods from Reddy on Credit Rs. 6,500
7. Sold goods for cash Rs. 2100
10. Paid to PMC for office Tax Rs. 250
12. Sold goods on credit to Roy Rs. 2,500
15. Paid Indian Express for advertisement Rs. 500
19. Bought goods for cash Rs. 1,200
21. Sold goods for cash Rs. 950
23. Paid for carriage Rs. 450
25. Paid for commission Rs. 300
27. Paid for Rawal’s son’s college fees Rs. 350
28. Sold goods for cash Rs. 200
29. Paid to Reddy on Account Rs. 3,000
30. Received from Roy Rs. 2,000 on account
30. Stock of goods on hand Rs. 2,700
Financial Accounting – Induction
Ledger Preparation - 3
Prepare Cash Account, as it would appear from the following transactions of M/s Ambadas for May 2004
1. Opening Balance Rs. 2,750
2. Sold goods for cash Rs. 3,800
3. Bought goods for cash Rs. 300
5. Received Rs. 2,500 from Shri. Mahant in full settlement of his account having balance of Rs. 2,530
10. Paid to M/s Sharma Rs. 2,000 on account
12. Sold goods for cash Rs. 1,500
13. Paid salaries Rs. 500
15. Paid for rent Rs. 200
21. Received commission from Shinde Rs. 250
25. Paid for advertisement Rs. 150
27. Withdrew or private expenses Rs. 400
Financial Accounting – Induction
Trial Balance – 1Prepare Trial Balance from The following balances given in the Books of Mr. John as on 31.03.2005
Amount (Rs.)Plant & Machinery 32,000
Debtors 22,000
Creditors 40,700
Goodwill 30,600
Discount Received 1,800
Discount Allowed 2,700
Furniture 14,300
Sales 2,30,000
Purchases 1,17,000
Purchase Return 1,800
Sales Return 3,100
Wages 22,400
Salaries 10,200
Carriage Inward 1,400
Carriage Outward 2,300
Loan to Mr. X 20,000
Printing & Stationery 3,500
Advertisement 4,800
Cash in Hand 970
Bank Balance 1,230
Bank Overdraft 11,500
Capital Account 1,00,000
Land 97,300
Financial Accounting – Induction
Trial Balance – 2
Prepare Trial Balance from The following balances given in the Books of Mr. Nana as on 31.12.2004. Any difference may be transferred to Suspense Account
Amount (Rs.)
Premises 85,000
Opening Stock 12,000
Purchases 28,000
Cash in hand 900
Bills Payable 17,300
Bank Loan 25,000
Capital Account 1,25,000
Furniture 12,000
Salaries 9,000
Interest Received 2,800
Investment 28,000
Sales 89,200
Creditors 36,400
Discount Allowed 1,300
Wages 20,400
Plant & Machinery 38,500
Debtors 41,300
Bills Receivable 11,200
Advertisement 8,100
Financial Accounting – Induction
Trial Balance – 3
Prepare Trial Balance from The following balances given in the Books of Mr. Sapan as on 31.12.2004. Any difference may be transferred to Suspense Account
Amount (Rs.)
Land & Building 1,40,000
Capital Account 1,70,000
Sales 2,05,000
Creditors 33,900
Carriage Inward 5,200
Purchases 1,07,000
Opening Stock 32,800
Debtors 45,300
Carriage Outward 2,900
Loan from Mr. Amit 55,000
Wages 28,000
Bank Overdraft 11,400
Commission Received 2,000
Salaries 18,800
Advertisement 10,500
Sundry Income 900
Vehicle Expenses 22,400
Vehicles 40,000
Investments 25,000
Financial Accounting – Induction
Rectification - 1
Rectify the following Errors
1. Goods worth Rs. 5,000/- sold to Mr. Amar recorded as purchases
2. Wages of Rs. 41,000/- were posted to Salaries Account
3. Stationery of Rs. 500/- was wrongly posted to Stationery Account as Rs. 5,000/- only in Ledger but cash book was correct.
4. Interest received of Rs. 310/- was accounted as Rs. 3,100/-
5. Goods of Rs. 100/- returned by us wrongly accounted in return inward account by the Accountant
6. Carriage Paid by us of Rs. 400/- wrongly posted at credit ide of the Account. The Cash book posting was correct.
7. Return Inward book was overcast by Rs. 1,000/-
8. Return outward book is undercast by Rs. 500/-
Financial Accounting – Induction
Rectification - 2
Rectify the following Errors
1. Machine purchased of Rs.25,000 was debited to Purchases Account
2. Wages on erection of Machine of Rs. 1,500/- were accounted as wages
3. Material of Rs. 25,000 and wages of Rs.11,000/- for addition to Building were debited to Purchases and wages Account
4. Land acquiring charges of Rs. 10,800 were debited to Legal Expenses
5. Carriages on purchases of Rs. 500 was debited to goods Account
6. Rs. 1,000/- paid for repairs were debited to Machinery Account
7. Salaries paid to Mr. A Rs.1,500/- were debited to his Account
8. Drawings of Rs. 700 were debited to Capital Account
9. Purchase Return was credited to Sales Ac of Mr. B for Rs. 2,500/-
10. A payment for traveling of Rs. 700/- was left out to be recorded
Financial Accounting – Induction
Bank Reconciliation Statement - 1
From the following details prepare Bank Reconciliation Statement as on 30.09.1992 in the books of Pratap. The Cash books showed Rs. 1,270/- in the Bank account
1. Cheque paid in to bank but not collected upto 30.09.92 amounted to Rs.1,270/-
2. Cheque of Rs. 560/- issued to two creditors were not encashed by them till date of balancing
3. Interest of Rs. 25/- paid by Bank and Charges of Rs. 30/- charged by bank were not accounted in the Cash Book
4. Bank had collected interest of Rs. 250/- on our behalf but not informed us before closing.
5. Bank had paid Rs. 750/- directly from our account for Municipal Taxes but not informed till date
6. The cash book total of payment side was undercast by Rs.1,000/-
Financial Accounting – Induction
Bank Reconciliation Statement – 1
From the following details prepare Bank Reconciliation Statement as on 30.06.04 in the books of Rana.
The Bank Balance as per bank records was Rs. 9,750/- credit
1. Cheques of Rs, 4,200/- were deposited before 30.06.04 but Rs. 1,500/- were realised in the account
2. Cheques of Rs. 3,700/- were issued before 30.06.2004 but were not presented by the Creditors
3. A bill receivable due was collected by bank for Rs. 3,000/- but was not informed to us before date of closing
4. Bank paid Membership fees directly of Rs.250/- the bill is awaited
5. Bank charges of Rs. 30/- were wrongly accounted as Rs. 300/- in the cash book
6. Interest of Rs. 450/- credited by Bank does not appear in Cash Book
Financial Accounting – Induction
Final Accounts – 1 – MA Following is the Trial Balance of Navin Traders for the year ended as on 31st March 2002. Prepare the Trading & Profit & Loss Account and the Balance Sheet as on the date
Trial Balance
Name of the Account Debit (Rs) Credit (Rs)Rent received 10,000Sales 5,12,000Creditors 56,600Bank Overdraft 1,40,000Bills Payable 23,000Capital 4,05,000Opening Stock 72,000Purchases 2,20,000Carriage Inward 8,000Wages 80,000Goodwill 30,000Free hold Land 60,000Leases hold land 1,00,000 Building 2,20,000Plant & Machinery 1,80,000Vehicles 70,000Furniture 20,000Advertising 10,000Salaries 38,000Stationery 8,300Office Expenses 4,100Bank Charges 100Carriage Outward 3,700Cash in hand 400Debtors 12,000Interest on Bank overdraft 10,000
11,46,600 11,46,600
Adjustments: - 1. Lease to run for Ten Years2. Depreciate P & M 15 %, Vehicles at 20 % and Furniture 10 %3. Stock as on 31.03.2002 was Rs. 58,000 4. Outstanding wages are Rs. 3,800 and salaries Rs. 4,5005. Interest for last quarter Rs. 4,600 not recoded for yet.6. Provide 5% on debtors as doubtful debts
_____________
Financial Accounting – Induction
Final Accounts – 2 – MA Following is the Trial Balance of Mr. Y for the year ended as on 31st March 2003. Prepare Final Accounts
Trial Balance
Name of the Account Debit (Rs) Credit (Rs)
Rent received 3,200Sales 2,12,000Debtors & Creditors 30,000 35,000 Loan from Mr. Y taken on 18,000
01.12.02 interest @ 12 % paReturn Inward & Return Outward 2,000 2,300Capital 1,10,000Opening Stock 25,000Purchases 98,000Carriage Inward 10,000Wages 21,000Printing & Stationery 17,000Insurance (paid for one year 2,200
On 01-10-2002)Land & Building 35,000 Machinery 60,000Patents 20,000Advertising 14,000 Salaries 32,000 Carriage Outward 12,000Cash in hand 2,300
3,80,500 3,80,500
Adjustments: - 1. Stock as on 31.03.2003 was Rs. 32,000 & Market price Rs. 26,0002. Depreciate P & M 10 %, Patents were revalued at Rs. 18,2003. A part of Building is let out at Rs. 1,000 per month4. Outstanding wages are Rs. 1,800 and salaries Rs. 3,800 & a printing bill of Rs. 1,200
_____________
Financial Accounting – Induction
Final Accounts – 3 – MA Following is the Trial Balance of Mr. Aditya for the year ended as on 31st March 2001. Prepare Final Accounts
Trial Balance
Name of the Account Debit (Rs) Credit (Rs)
10 % Investments 30,400(Face Value Rs.32,000)Debtors 32,400Wages 14,300Opening Stock 10,200Purchases 40,800 Carriage Outward 2,400Carriage Inward 3,200 RDD 1,200Capital 1,40,000Loan 20,000Sales 1,08,000Creditors 8,400 Machinery 50,000Furniture 15,000Vehicles 24,000Salaries 18,500Advertising & Publicity 9,000Rent & Taxes 4,400 Postage & Telephone charges 2,800Cash in Hand 3,500Cash at Bank 12,300Import Duty 1,900Power Chares 2,500
______________________________ 2,77,600 2,77,600
Adjustments: - 1. Stock as on 31.03.2001 was Rs. 7,3002. Depreciate P & M by Rs.5000, Furniture Rs. 3,000, Vehicles Rs. 1,0003. Provide 5% for Doubtful debts4. Outstanding wages are Rs. 1,200 and salaries Rs. 1,4005. Investments are purchased on 01-07-20006. Provide interest on Loan at 12% 7. Goods worth Rs. 1,000 were taken by Aditya for personal use8. Goods worth Rs.1,500 distributed as free samples were not accounted
____________________
Financial Accounting – Induction
Final Accounts – 4 – MA Following is the Trial Balance of Mr. John for the year ended as on 31st March 1999. Prepare Final Accounts
Trial BalanceName of the Account Debit (Rs) Credit (Rs)Sales 1,75,000Bills Payable 12,400Creditors 22,000Capital 72,000Debtors 20,400Bad Debts 800Machinery 44,000Furniture 14,000Opening Stock 28,000Insurance 1,800Machinery Installation charges 2,000Postage 3,600Purchases 89,700Stationery & Printing 12,500Salaries 18,300Office Expenses 4,300Wages 12,800Factory Exp. 2,800Carriage Inward 3,700Royalties on Production 10,500Cash in Hand 790Bank Balance 8,510Carriage outward 2,900
______________________________
2,81,400 2,81,400 Adjustments: - 1. Provide Rs. 400 as further bad debts2. Provide for 5 % on doubtful debts and 2% discount on debtors3. Provide 4% as reserve on discount on Creditors4. Provide 10% depreciation on all depreciable assets5. Closing stock is of Rs. 35,000 6. Insurance is paid as 01.10.1998 for one year.7. Goods worth 2000 were lost by theft and insurance company admitted claim of Rs. 1,500
____________________
Financial Accounting – Induction
Final Accounts – 5 – MA Following is the Trial Balance of Mr. Swami for the year ended as on 31st March 2003. Prepare Final Accounts
Trial BalanceName of the Account Debit (Rs) Credit (Rs)Cash in Hand 170Patents for 5 years 10,000Patterns & Fixtures 12,000Income Tax – personal 3,800Rent & Taxes (Office) 4,300Rent & Taxes (Factory) 3,200Trade Expenses 2,000Opening stock 5,000Office Expenses 1,800Travelling expenses 1,900Discount Received 1,400Outstanding expenses 4,300Commission Received 1,300Bank Overdraft 16,400Sales 1,70,000Capital 2,00,000Creditors 10,200Telephone charges 2,200Goodwill 18,000Bank Interest 830Insurance 1,300Life insurance premium 2,400Wages & Salaries 22,300Purchases 80,300Carriage Inward 2,100Power Charges 5,300Debtors 24,700Building 80,000Plant & Machinery 1,20,000
______________________________
4,03,600 4,03,600 Adjustments: - 1. Manager is to be given 5% commission on sales2. Travelling expenses of Rs.800 are yet to be paid to a salesman3. Commission of Rs.500 has been received in advance4. Debtors include Rs. 500 which are bad. 5. Provide 5% RDD on balance debtors6. Closing Stock if costing 15,000 but market value is Rs. 12,400
Financial Accounting – Induction
7.Depreciate Plant & Mach. At 15% and Building at 10%.____________________
Final Accounts – 6 – MA Following is the Trial Balance of Mr. Sethi for the year ended as on 31st March 2002. Prepare Final Accounts
Trial BalanceName of the Account Debit (Rs) Credit (Rs)Debtors 20,000Duty & Clearing charges 3,100Gas & water 1,200Motor Car 5,900Salary for 11 months 22,000Free hold land 24,000Creditors 10,000RDD 700Bills payable 8,000Sales 1,18,000Other Income 6,200Capital 1,20,000Bills Receivable 14,000Printing charges 2,000Sundry Expenses 800Audit fees 1,500Accountancy charges 2,100General expenses 1,400Furniture 10,000Advertisement 4,000Machinery 40,000Cash in Hand 1,400Purchases 51,900Wages 18,300Opening stock 20,300Goodwill 19,000
______________________________
2,62,900 2,62,900 Adjustments: - 1. Rent due but not paid Rs. 3,0002. Goods of Rs. 1,800 were distributed as free samples3. Manager is to be given 10 % commission on sales4. Half of the printing charges are for next year5. Maintain 5% RDD on debtors & 5% for discount on Creditors6. Depreciate all fixed assets at 10% on TB Value (Except Goodwill)7. Closing stock was Rs. 21,800
____________________
Financial Accounting – Induction
Ratio Analysis – 1 – MA
Summarised Balance Sheet and Profit & Loss Accounts of Ms AB Limited as on 31.03.2001 & 31.03.2000 are given in Rs. Lacs. BALANCE SHEETCapital & Liabilities 31.03.2001 31.03.2000Share Capital 694 694Reserves & Surplus 97 48 Debentures 300 300Loans 240 165Current Liabilities: -
Creditors 1000 1500Bills Payable 400 450Bank Overdraft 527 1927 215 2165
3258 3372
AssetsFixed Assets 1005 1044Investments 8 8Current Assets: -Inventory 750 800
Cash & Bank Balance 350 450Sundry Debtors 1145 2245 1070 2320
3258 3372
PROFIT & LOSS ACCOUNT (For the Year Ended …)
Sales 4740 5057Material 2920 2772Other Expenses 1546 1813
Total Expenses 4466 4585
Operating Profit (Before Interest) 274 472 Interest 238 161 Profit After Interest 36 311Other Income 15 13
51 324
From the above information calculate Current Ratio, Acid test Ratio, Total Asset Turnover ratio, CA turnover ratio, Capital turnover ratio, Debt equity ratio, Proprietary ratio, Operating Profit Ratio, Return on
Financial Accounting – Induction
assets, Return on Capital employed, return on share holders funds and Material Consumption Ratio
Ratio Analysis – 2 – MA
Summarised Accounts of Ms MN Limited and Ms PQ Ltd as on 31.03.2004 are given in Rs. Lacs. BALANCE SHEETCapital & Liabilities Ms. MN Ltd Ms. PQ LtdShare Capital 183 181Reserves & Surplus 149 143 Debentures 50 45Loans 122 153Current Liabilities: -
Creditors 400 325Bills Payable 155 165Bank Overdraft 124 679 198 688
1183 1210
AssetsFixed Assets 425 495Investments 2 35Current Assets: -Inventory 375 315
Cash & Bank Balance 90 75Sundry Debtors 291 756 290 680
1183 1210
PROFIT & LOSS ACCOUNT (For the Year Ended …)
Sales 1810 1659Material 1193 943Other Expenses 509 519
Total Expenses 1702 1462
Operating Profit (Before Interest) 108 197 Interest 92 97 Profit After Interest 16 100Other Income 18 22
34 122
From the above information calculate Current Ratio, Acid test Ratio, Total Asset Turnover ratio, CA turnover ratio, Capital turnover ratio,
Financial Accounting – Induction
Debt equity ratio, Proprietary ratio, Operating Profit Ratio, Return on assets, Return on Capital employed, return on share holders funds and Material Consumption Ratio and any major observations if made assuming both the Companies from same sector and activity
Ratio Analysis – 3 – MA
Analyse the following four’s information of Shree Ltd with help of required & relevant ratios and discuss the performance of the Company
(Rs. Lacs)
2004-05 2003-04 2002-03 2001-02Sales 2,150 1,975 1,925 1,750
Material Consumed 1,050 995 965 895Factory Exp. & Wages 425 365 360 335 Total Direct Exp 1,475 1,360 1,325 1,230
Gross Profit 675 615 600 520
Administrative Exp 130 110 105 115Selling & Distribution 185 178 154 140 Finance Costs 45 42 38 35Depreciation 65 58 55 57 Total Indirect Exp 425 388 352 347
Net Profit 250 227 248 273
Other Important information from Balance Sheet is as Follows: - 2004-05 2003-04 2002-03 2001-02
Inventory 345 330 315 275
Cash & Bank 25 45 30 28Debtors 970 925 875 750
Creditors 390 375 325 343Bills Payable 15 45 55 20
Financial Accounting – Induction
____________
Fund Flow – Sample Problem – MA
Prepare fund flow from the Balance Sheets of Jeevan Limited
1994 1995 1994 1995Equity Sh Cap 30,000 35,000 Fixed Assets 51,000 62,0009 % Pref Sh 20,000 10,000 Investments 3,000 8,000Debentures 10,000 20,000 Current Assets 24,000 37,500Reserve 11,000 27,000 Prelim Exps 1,000 500R.D.D. 1,000 1,500Current Liab 7,000 14,500
79,000 108,000 79,000 1,08,000
The other information during the year is as under
1. A machine costing 7,000 (Book Value of Rs. 4000) was sold for Rs.2,500
2. 15 % Dividend was paid to the equity capital on opening balance, however the preference capital was not paid anything extra but agreed rate.
3. The redemption of preference was done at the year end at
Rs. 500 as premium on redemption.
4. Depreciation on Fixed Assets was Rs. 7,000 at the end or the year.
Financial Accounting – Induction
MA – Cost Sheet – 1
Prepare Cost Sheet from details of a Chemical Factory given as under for 2004 – 05, which is manufacturing and selling chemical mixtures: -
Stock as on 01.04.2004 – Raw Material 2,00,000Work in Progress 8,00,000Finished Goods 4,50,000
Purchases 22,50,000Factory Stores consumed 75,000 Factory Wages 2,25,000Power & Fuel 1,65,000Depreciation on Machinery 1,25,000Factory Salaries 3,25,000 Office Salaries 4,65,000 Other Administration Expenses 8,75,000Selling & Distribution Expenses 7,77,000Interest on Loan 4,35,000 Commission on Sales 1,10,000 Sales 72,00,000Sale of Scrap 85,000Profit on Sale of Assets 35,000 Stock as on 31.03.2005 –
Raw Material 1,95,000Work in Progress 6,35,000Finished Goods 2,35,000
Financial Accounting – Induction
MA – Cost Sheet – 2
Prepare projected Cost Sheet from estimates of a Garment Factory given as under for 2005 – 06: -
Estimated Sales would be Rs. 55,00,000/ -
The Material Consumption would be 42.00 %The Direct Labour Cost would be 6.60 %Direct overheads would be 4.25 %Factory overheads would be 0.65%Admin & Office Overheads be 8.25 % Selling & Distribution Overheads 12.25 %Commission on sales 5.00 %Managerial Remuneration 2.00 %Depreciation on Production Assets 1.50 %Depreciation on Other Asset 1.25 %
Also Estimate Per unit costs and profitability if average price of the product is Rs. 1000/-.
Financial Accounting – Induction
MA – Cost Sheet – 3
A Manufacturing Company sold 1,000 TVs in the Year 2004. A summary of related Accounts is as follows
Trading & Profit & Loss Account for the year 2004
To Material Cost 80,000 By Sales 4,00,000To Direct Wages 1,20,000 To Mfg Costs 50,000To Gross Profit 1,50,000
4,00,000 4,00,000 To Staff Salary 60,000 By Gross Profit 1,50,000To Rent & Rates 10,000 To Selling Exps 30,000To General Exps 20,000To Income Tax 5,000To Net Profit 25,000
1,50,000 1,50,000
1. Next Year the Output would be 1,200 TVS
2. Price of Material will rise by 20 %
3. Wages will rise by 5 %.
4. Manufacturing cost will rise by 10 %
5. Selling Cost per unit will remain same.
6. Other expenses will remain unaffected
Financial Accounting – Induction
You are requested to prepare Cost Sheet and calculate selling price at which each TV should be marketed to show profit of 10 % on the cost.
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