Preparation of Financial Statements from Incomplete Records.
On April 1, 20X6, Manish Mukherjee set up Realtime Consultancy Ltd. With a share capital of Rs.30,000. He did not maintain proper accounts of the company’s transactions although he barely noted some details in his personal diary. Mukherjee’s secretary has kept files containing invoices raised on customers and cash memos and invoices for purchases of office supplies.
With great difficulty you have assembled the following information from Mukherjee’s diary, the files kept by his secretary, and the company’s bank statements:
1. Cash receipts during the Period are as follows:
|
Advances from customers |
Rs.6,500 |
|
Collections from customers |
38,400 |
2. Cash disbursements during the period are as follows:
|
Rent advance for 24 months (paid on April 1, 20X6) |
12,000 |
|
Insurance premium for 12 months (paid on April 1, 20X6) |
1,200 |
|
Office equipment |
18,000 |
|
Cash purchases and payments to creditors |
9,470 |
|
Salaries paid to employees |
13,200 |
|
Electricity expense paid |
1,430 |
|
Telephone expense paid |
2,200 |
|
Dividends paid |
8,000 |
3. Invoices for consulting services raised during the year totalled Rs.47,300. The amount excludes the value of services of Rs.5,900 provided to customers who had paid advance totalling Rs.6,500
4. Invoices and cash memos for purchase of office supplies totalled Rs.12,190
5. Depreciation on office equipment is Rs.2,000 per year.
6. Unpaid expenses on March 31, 20X7 are as follows:
|
Salaries |
1,200 |
|
Electricity |
130 |
|
Telephone |
200 |
7. Inventory of office supplies on March 31, 20X7 is Rs.7,480
8. Estimated income tax for the year is Rs.10,000
Required
1. Prepare the March trial balance on a worksheet form, and complete the worksheet.
2. Prepare the 20X7 profit and loss account, statement of retained earnings and balance sheet as on March 31, 20X7.
3. Prepare the March post closing trial balance.