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Hyper Star TradersAdjustment Entries
Entry # 1
Particulars
Amount(Dr.)
Rs.
Amount(Cr.)
Rs
Closing Stock A/c 200,000
Profit and Loss A/c 200,000
Total 200,000 200,000
Closing Stock is Recorded
Entry # 2
Particulars
Amount(Dr.)
Rs.
Amount(Cr.)
Rs.
Bank charges A/c 150
Accrued Bank charges A/c 1,50
Bank charges A/c 5,00
Accrued Interest on Loan A/c 500
Total 650 650
Adjustment entry for Bank Charges and interest loan Payables
that recorded
Entry # 3
Particulars
Amount(Dr.)
Rs.
Amount(Cr.)
Rs.
Accrued dividend A/c 2,000
Dividend Income A/c 2,000Total 2,000 2,000
Adjustment entry for the accrued dividend Recorded
Entry # 4
Particulars
Amount(Dr.)
Rs.
Amount(Cr.)
Rs.
Bad debts on Sundry debtors A/c 5,000
Sundry debtors A/c 5,000
Total 5,000 5,000
Adjustment entry for bad debts on sundry debtors (100,000*5% =
5000)
Entry # 5
Particulars
Amount(Dr.)
Rs.
Amount(Cr.)
Rs.
House rent expense A/c 5,000
Capital A/c 5,000
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Total 5,000 5,000
Adjustment entry for house rent paid from owners personal
account
Entry # 6
Particulars
Amount(Dr.)
Rs.
Amount(Cr.)
Rs.
Depreciation on plant A/c 40,000
Plant A/c 40,000
Total 40,000 40,000
Adjustment entry for depreciation of the plant is charged
Answer: B)
Net Sale - Cost of Good Sold= Gross Profit
Gross Profit -Operating Expenses= Operating ProfitOperating
Profit + Other Income Received Financial Expenses= Net
Profit
Hyper Star Traders Income Statement
For The Year Ended
31 December,2009 Particulars Amount Rs. Amount Rs.
Sales 924,000
Return Inwards 8,000
Net Sales 916,000Cost of Good Sold
Opening Stock 120,000
Purchases 680,000
Return Outwards (4,800)
Net Purchases 675,200
Wages 45,200
Cost of Goods Available for Sale 840,000
Closing Stock (200,000)
Cost of Good Sold (640,400)
Gross Profit 275,600
Administrative Expenses
Salaries 48,000
House Rent Paid 5,000
Insurances paid 2,800
Depreciation On Plant 40,000
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Selling Expenses
Carriage Outward 3,600
Bad Debts on Sundry Debtors 5,000
Total operating Expenses (104,400)
Operating Income 171,200Other Income Received
Dividends Received 2,000
Interest Received 8,00
Commission Received 2,000
Total Other Income Received 4,800
Net Operating Income 176,000
Financial Expenses
Bank Charges 1,50
Interest on Loan 5,00
Total Financial Expenses (6,50)Net Profit 175,350
Net Profit Transferred to Balance sheet 175,350
Answer: C)
Assets= Liabilities+ Owners Equity
Hyper Star Traders, Balance Sheet As At 31, December 2009
Particulars Amount Rs. Amount Rs.
Assets
Current Assets
Cash in Hand 4,000
Cash in Bank 36,000
Sundry Debtors 100,000
Bad Debts (5,000)
Net sundry Debaters 95,000
Bills Receivable 44,000
Dividends Receivable 2,000
Closing Stock 200,000
Total current Assets 381,000
Long Term Assets
Long Term Investment 60,000
Total Long Term Assets 60,000
Fix Assets
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Furniture 40,000
Plant 200,000
Depreciation OF Plant (40,000)
Net Written Down Value Of Plant 160,000
Total Long Term Assets 200,000
Total assets 641,000
Liabilities
Current Liabilities
Bills Payable 20,000
Bank Charges Payable 1,50
Bank Interest on Lone Payable 5,00
Sunday Creditors 160,000
Total Current Liabilities 180,650
Long Term and Fix Liabilities
Owner's Equity
Capital 280,000
Owner Paid Rent Add Equity 5,000
Net Owner's Equity 28
Add: Net Profit From P&L Account 175,350
Total Liabilities 641,000
Calculations:Depreciation on plan: Plant value depreciation =
Net WDV of Plant
200,000 40,000 = 160,000
Bad Debater on Sundry Debaters:
100,000*5%=%5,000
