Department of Technical Education

Andhra Pradesh
Name N. Sambaiah
Designation Head of Section
Branch DCCP
Institute SUVR & SR Govt Polytechnic for
women,Ethamukkala
Year I year
Subject Accountancy-I
Subject code CCP-102
Topic Final accounts
Duration 50 Mts
Sub topic Preparation of Trading and Profit and Loss
account-2 (without adjustments)
Teaching aids PPT, Animations
CCP102.129 1
objectives
 On completion of this period, student will be able to

 Consolidate his knowledge on the preparation of

Trading account and Profit and Loss account

CCP102.129 2
 Assignment 1
Prepare trading and profit and loss account for Mr. Ravi of
Bombay for the year ending 312-12-2007 from the following
trial balance.
particulars debit credit

Rs Rs
Opening stock raw material 5400
work in progress 6500
finished goods 10100
---------- 22000
purchases 12750
motive power 650
motor van repairs 750
motor insurance 800
rates and taxes 900
carriage 200
sales 34400
return inwards 350
return outwards 540
commission 460
discount 845
bad debits 1500

(contd)
CCP102.129 3
Assignment 1 (contd)

office rent 450

office salaries 550
octroi 225
municipal taxes 1200
capital 9000
------------- --------------
42,785 42,785
--------------- ------------
closing stock
raw material 5300
work in progress 7600
finished goods 8600
------------
21500
----------

CCP102.129 4
 Solution to Assignment 1
Trading and Profit and Loss account of Mr. Ravi, Bombay for the year ending
as on 31-12.2007.
Dr Cr
Particulars amount particulars amount

Rs. Ps Rs. Ps
To opening stock By Sales 34400
Raw material 5400 Less: returns 350
Work in prog. 6500 --------- 34050
Finished goods 10100 By Closing stock
----------- 22000 Raw material 5300
To Purchases 12750 Work in progress 7600
less: returns 540 Finished goods 8600
---------- 12210 ---------- 21500
To Carriage 200
To Octroi 225
To Motive power 650
To Gross profit 20265
------------- ------------
55550 55550
-------------- -----------
(contd)

CCP102.129 5
Contd.

To Motor van repairs 750 By Gross profit 20,265

To Motor van insurance 800 By Discount 845
To Rates and Taxes 900
To Commission 460
To Bad debts 1500
To Office Rent 450
To Office Salaries 550
To Municipal taxes 1200
To Net profit (transferred to 14500
capital account ---------- -----------
21110 21110
----------- -----------

CCP102.129 6
Assignment 2
From given information prepare Trading and Profit and loss account of Sri
Vijay of Delhi as on 31-12-2007.
Opening stock Rs. 6570
Octroi 500
General expenses 600
Cartage 670
Salaries 2500
Purchases 11500
Sales 16400
Discount received 520
Sales returns 400
Purchase returns 500
Manufacturing wages 620
Duty and clearing charges 450
Office rent 560 contd.

CCP102.129 7
Assignment 2 contd.
Factory rent 480
Discount allowed 280
Manager salary 1000
Marine insurance 500
Factory insurance 600
Insurance 700
Selling and distribution expenses 400
Salesmen commission 200
Office expenses 300
Factory expenses 250

Closing stock is valued at Rs. 8800

CCP102.129 8
 Solution to Assignment 2
Trading A/c for the period ending 31-12-07
Dr. Cr.
particulars Amount particulars amount
Rs Ps Rs Ps
To opening stock By sales 16400
To purchases 11500 less: returns 400
Less: Returns 500 16000
----------- 11000 --------
To Octroi 500 By closing stock 8800
To cartage & carriage 670
To manufacturing wages 620
To duty & clearing charges 450
To factory rent 480
To marine insurance 500
To factory insurance 600
To factory expenses 250
To Gross profit (transferred to 3160
Profit and loss account) -------------
24800 ----------
-------------- 24800
-----------

CCP102.129 9
Profit and Loss account of Sri Vijay of Delhi as on 31-12-2007
Dr Cr.

Particulars amount particulars amount

Rs. Ps Rs Ps
To salaries 2500 By Gross profit b/d 3160
To general expenses 600 By discount received 520
To office rent 560 By net loss 2860
To discount allowed 280 (transferred
To manager’s salary 1000 capital account)
To insurance 700
To selling and distribution 400
exp.
To salesmen commission 200
To office expenses 300
--------------- ----------
6540 6540
--------------- -----------

CCP102.129 10
 Summary
The problems & solutions covered so far gives you a
very good understanding of P&L a/c

CCP102.129 11
 Quiz
1. Net profit/loss is transferred to:
b) suspense a/c
c) Trading a/c
d) P&L a/c
e) None of above

7. Discount on Dr side of trial balance appears in

h) P&L a/c – Dr.side
i) P&L a/c – Cr.side
j) Trading a/c – Cr.side
k) None of above
CCP102.129 12
Assignment 1
1. Prepare P&L a/c from the following
Gross Profit Rs 10,000
salaries 1,000
income accrued 500
office expenses 1,200
Rent 400
printing & stationery 600
selling commission 200
office lighting 500
Dividend on shares 5,000

CCP102.129 13