Page 93 - DMGT403_ACCOUNTING_FOR_MANAGERS

Debit
Particulars
Capital
6,00,000
12,000
Drawings
Buildings
30,000
Furniture and fittings
Depreciation on Reserve
Buildings
10,000
3,000
Furniture
Depreciation for the year 2,00,000 Credit
13,000
Purchases 4,00,000
Sundry creditors 40,000
Sales 5,00,000
Accounting for Managers
Debtors 1,20,000
Establishment charges 20,000
Electricity charges 6,575
Notes Postage and telegram 1,284
Travelling and conveyance 3,816
Advance for sales commission 1,000
Insurance 2,500
Rent received 12,000
Motor van (purchased 1.1.10) 80,000
Motor van maintenance 23,425
Fixed deposit (1.9.2010) 1,00,000
Cash in hand 1,823
Cash at bank 1,47,977

Due to the difference in the trial balance, an examination of the goods was conducted
which reveals following errors.
25 paid to the conveyance was debited to motor van maintenance account.
2,000 drawn from bank towards for establishment charges was omitted to be posted into
ledger.
Cash column in the cash book on the receipt side stands excess total by 400
Adjustment Entries:

(a) Establishment of charges have been paid only up to November and provision of
2,000 has to be made for December.
(b) Electricity charges are O/s 25

(c) (½) commission on total sales is payable to salesmen, towards which 1000 as paid
in advance.
(d) Fixed deposit earns interest at 9% per annum.

(e) Provide depreciation 20% per annum on motor car.
(f) C losing stock 31 December, 2010 1,00,000
st
Answers: Self Assessment

1. Internal users 2. Solvency of the Business
3. Financial Statements 4. Stock Exchanges
5. Capital expenditure 6. Iintangible assets

7. Trial Balance 8. Gross profit
9. Net profit 10. Financial position
11. False 12. True
13. False 14. True

15. False

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