Model: Preparation of P & L A/c From the following information, prepare the profit and loss A/c of Merchant Bank Ltd. for the year ended on 31 March 2011 in the prescribed form:

Rs.

Interest on Loan

5,18,000

Interest on Fixed Deposits

5,50,000

Rebate on Bills Discounted Required

98,000

Commission

16,400

Establishment

1,08,000

Discount on Bills Discounted

3,90,000

Interest on Cash Credit

4,46,000

Interest on Current Account

84,000

Rent and Taxes

36,000

Interest on Overdraft

3,08,000

Director’s Fees

6,000

Auditor’s Fees

2,400

Interest on Savings Bank Deposits

1,36,000

Postage, Phone, Internet Expenses

2,800

Printing and Stationery

5,800

Sundry Charges

3,400

Bad debts to be written off amounted to Rs.80,000. Provision for taxation may be made @ 50%. Balance of profit from last year was Rs.2,40,000. The Directors have recommended a dividend of Rs. 40,000 for the shareholders.