ACCOUNTANCY PROJECT FOR CLASS XI – 2015-2016.

1. Reba had studied fashion at the Institute of Fashion Technology. During the course of her training
at the institute she had developed various designs for ladies and kids wear. She had held some
exhibitions also. By the time she came out of IFT, her name was very well known in the fashion
world.

She decided to set up her own fashion boutique. She worked out the financial requirement which
came out to be 10,00,000 to start with. She had 4,00,000 of her own and she borrowed another
6,00,000 from a friend of hers @6%p.a. for two years. She formally started her boutique on 1st
April,2014. It was named as ‘Reba creations’. She opened a bank account with 8,00,000. She had her
own car which was worth 80,000. She decided to use the same car for the business. On 4th April, she
arranged a two room ground floor flat and paid advance rent of 2,000 per month for 5 months. On
the 7th of April, she bought sewing machines for 1,40,000, Furniture for 16,000, Purchased fabric for
50,000 and other accessories for 15,000 for production. Petty expenses were paid by cash. All other
expenses were paid by cheque.

She had been drawing 8,000 per month for her private expenses.
During the year she sold goods on credit only 27,22,000
Receipts from Debtors 25,00,000
Discounts allowed to these Debtors 12,000
During the year she purchased goods on credit 15,35,000
Payments to creditors 14,00,000
Discount received 10,000
Salaries paid to designers and tailors for 11 months 1,32,000
Advertising expenses 15,000
Petty expenses 50,000
Trade expenses 18,000
Postage and telephone 25,000
Travelling expenses 30,000
Rent paid @2,000p.m. (including advance rent) 22,000
Office expenses 25,000
Power expenses 48,000
Stationery expenses 18,000
Selling expenses 12,000
st
On March 31 2016 the following balances appeared in the books of the firm:
1. Trade debtors 2,10,000
2. Trade creditors 1,25,000
3. Cash in hand 50,000
4. Stock in hand 6,80,000
Depreciation on all fixed assets and car was at 10%p.a.
There was a fire in the godown and goods worth 20,000 were destroyed. The insurance company
accepted only 12,000 as a claim for the loss.
At the end of the first year she managed to pay back 2,00,000 on the loan amount.
Reba wants to judge the performance of her firm. Help her by preparing final accounts and
interpreting the results thereof.
 Case Study (II) For Class XI Accounts Project

The Bank Balance shown by the pass book of Jyoti Enterprises was Rs.78,900 whereas the cash book
shows the balance of Cash at bank as Rs.87,620 on 31.03.2014. The following differences were
located while comparing the transactions recorded in the Cash book and Pass Book of Jyoti
enterprises.

1. Cheques issued from the personal account of Jyoti debited to the firms account 6,000

2. Cheque deposited but not yet collected by the bank 3,600

3. A cheque deposited into the bank and collected but not recorded in the cash book 5,400

4. A cheque from a customer dishonoured. 2,800

5. Cheques issued but not yet presented for payment. 7,250

6. Direct payments made by bank 4,000

7. Amount deposited by a customer into the bank 1,750

8. A bill discounted with the bank earlier was dishonoured when presented on maturity 8,300

9. Bank charges 640

10. Collection of interest and dividend by the bank 2,200

You are required to compute the correct cash book balance and prepare a bank reconciliation
statement for Jyoti Enterprises.