A and B are in partnership in computer components manufacturers. The balance sheet of A and B as on 31 December 2010 was as follows: Liabilities Assets Creditors 2,62,100 Cash at Bank 82,500 Capital Accounts: Debtors 5,28,600 A:7,95,100 Stock 4,40,900 B:7 95 100 15,90,200 Plant 5,00,300 Land & Buildings 3,00,000 18,52,300 18,52,300 They decided to sell their business as from the above date to Chips […]

M/s Anju & Manju carrying on business in partnership decided to dissolve the firm and sell off the business to a limited company, a newly floated one, on 31 December 2010, when the firm’s position was as follows: Liabilities Assets Creditors 2,55,000 Furniture 39,840 Capital Accounts Stock 1,84,560 Arlin 4,08,000 Debtors 5,81,400 Ma* 2.04.000 612000 Cash 61,200 8,67,000 8,67,000 The arrangement with the limited company […]

AB & Co. is converted into a limited company but the same books of accounts are desired to be continued. The balance sheet with reference to which the conversion has taken place is given as follows: Liabilities Assets Capital Accounts Machinery 15,00,000 A 30,00,000 Car 5,00,000 B 20,00,000 50,00,000 Stock 25,00,000 Reserve 5,00,000 Debtors 19,00,000 Creditors 10,00,000 Cash 1,00,000 65,00,000 65,00,000 Goodwill is valued at […]

Sharma and Varma were carrying on business in partnership sharing profits and losses in the ratio 3:2. They sell their business to a limited company on 31 March 2011 and on that date their balance sheet stood as follows: Liabilities Assets Capital Accounts Plant & Machinery 3,60,000 Sharma 4,80,000 Land & Building 2,40,000 Varma 3.60.000 840,000 Investment 1,20,000 Reserve Fund 1,20,000 Stock 2,40,000 Creditors 2,40,000 […]

On 1 January 2010, Patel sells his business to Rao Ltd. The company took over the assets and liabilities for a purchase consideration of Rs.4,25,000 being paid equally in cash and shares of Rs.50 each fully paid up. Patel received Rs.75,000 on account in 2010 from the company but no other entries have been made. The balance sheet of Patel’s business on the date of […]

M and N are proprietors of a competing business. In order to protect their business, they float a company called M&N Ltd. with an authorized capital of Rs.30,00,000 divided into 1,80,000 equity shares of Rs.10 each and 12,000 12% preference shares of Rs.100 each. On the date of the transfer, M’s assets amount to Rs.7,96,050 excluding goodwill. His liabilities at the same time amount to […]

The following is the balance sheet of M/s P & Q as on 31 March 2011: Liabilities Assets Sundry Creditors 80,000 Land & Building 4,00,000 Mrs. P”s Loan 3,60,000 Plant & Machinery 3,20,000 Capital Accounts Stock in Trade 1,20,000 P:4,80,000 Sundry Debtors 2,00,000 Q:3.20.000 8,00,000 Investments 1,60,000 Cash at Bank 40,000 12,40,000 [2,40,000 Profits were shared as two-thirds to P and one- thirds to Q. […]

The balance sheet of X, Y & Z stood as follows when they sold off the concern to a newly started joint stock company. Liabilities Assets Capital Accounts Land & Buildings 1,68,000 X 2,70,000 Machinery 84,000 Y 1,80,000 Stock 1,56,000 Z 90.000 5,40,000 Debtors 1,08,000 Sundry Creditors 48,000 Bills Receivable 72,000 5,88,000 5,88,000 The joint stock company was started with a capital of Rs.12,00,000 divided […]

X Ltd. was incorporated for taking over the business of Y from 1 April 2011. The following was the balance sheet of Y as on 31 March 2011: Liabilities Assets Capital 2,01,600 Land & Buildings 3,20,000 Loan Creditors 2,40,000 Plant & Machinery 56,000 Trade Creditors 1,42,400 Furniture 40,000 Sundry Debtors 1,68,000 5,84,000 5,84,000 The company took over the business with fixed assets and loans on […]

From the following data, produce a trading account for the year ended 31 December 2016. £ Opening inventory 8,750 Closing inventory 9,230 Purchases 64,300 Sales 97,400