Question 1

Deluxe Traders Limited has Authorized Share Capital of Rs. 300,000 comprised of 30,000
ordinary shares of Rs. 10 each. Trial Balance as on 31st Dec. 2016 is given below.

Description Dr. Cr.

Rs. Rs.
Freehold Premises 150,000
Plant & Machinery 165,000
Furniture & Fixtures 3,600
Stock January 01, 2016 37,500
Accounts Receivables 43,000
Interim dividend paid on 1st of July, 2016 10,000
Purchases 92,500
Cash at Bank 28,800
Cash in hand 400
Carriage Inward 5,300
Utilities Expenses 1,200
Preliminary Expenses 2,500
Repairs & Renewals 2,100
Salaries & Wages 52,800
Directors' fees 2,800
Miscellaneous Expenses 3,000
Debentures’ interest 9,000
Bad Debts 1,000
Issued, subscribed & paid up capital 200,000
12% Debentures 150,000
Retained Earnings 7,200
Accounts Payables 44,000
Sales 207,500
Provision for Bad & Doubtful Debts 1,800
610,500 610,500
Additional Information:
1. Depreciate Plant & Machinery and Furniture & Fixtures by 10%.
2. Write off Rs.500 from preliminary expenses.
3. Maintain a provision for Bad Debts @ 5% on Accounts Receivables.
4. During the year, a machine whose book value was nil, was sold for Rs.7,000 and the amount
was included in Sales.
5. Stocks as on 31st Dec. were valued at Rs.60,000.
6. Transfer Rs.10,000 to General Reserve.
7. Directors have proposed a final dividend @ 10%.
Prepare following for the year ended December 31,
Required: 2016
1. Statement of Comprehensive Income.
2. Statement of Changes in Equity.
3. Statement of Financial Position.
Question 2
Authorised capital of Nishat Limited consists of 500,000 shares of Rs.10 each. You are given
below the trial balance for the period ended December 31, 2017
Description Rs. Rs.
Plant and Machinery 300,000
Land 350,000
Building 600,000
Long-term Investments 550,000
Furniture and Fixture 100,000
Inventory (Jan.1, 2017) 125,000
Prepayments 25,000
Cash in hand 200,000
Cash at bank 350,000
Purchases 700,000
Transportation-In 20,000
Salaries 75,000
Selling expenses (excluding Depreciation) 325,000
Administrative expenses (Excluding Depreciation) 225,000
Loss on Disposal of Asset 30,000
Interest Paid 75,000
Accumulated Depreciation - Plant & Machinery 30,000
Accumulated Depreciation - Building 20,000
Issued, paid up & subscribed capital 1,000,000
General Reserves 100,000
Retained Earnings 50,000
Loan 1,000,000
Accounts Payables 100,000
Short-term running finance 250,000
Sales 1,500,000
4,050,000 4,050,000

Additional Information:
1. Closing inventory was valued Rs.250,000.
2. The company pays income tax @ 40%.
3. Charge depreciation on plant & machinery, Furniture & Fixtures and Building @ 10%.
4. Accrued Expenses are of Rs.2000
5. Prepaid Expenses are of Rs.1000

Required: Prepare Following for the year ended December 31, 2017
1. Statement of Comprehensive Income Statement.
2. Statement of Changes in Equity.
3. Statement of Financial Position.