Model: Preparation of P & L A/c The following figures are extracted from the books of Lucky Bank Ltd. for the year ending on 31 March 2011:

Rs.

Interest and Discount Received

60,90,000

Interest Paid on Deposits

36,06,000

Issued and Subscribed Capital

15,00,000

Reserve under Section 17

10,50,000

Commission, Exchange and Brokerage

2,70,000

Rent Received

90,000

Profit on Sale of Investments

2,85,000

Director’s Fees and Allowances

36,000

Rent and Taxes Paid

1,62,000

Stationery and Printing

36,000

Postage and Phone

75,000

Other Expenses

36,000

Audit Fees

12,000

Depreciation on Bank Properties

37,500

Other information:

  1. A customer, to whom a sum of Rs.7,50,000 has been advanced, has become insolvent and it is expected that 40% can be recovered from his estate. Interest due at 15% on his debt has not been provided in the books.
  2. Provision for bad and doubtful debts on other debts necessary is Rs.1,50,000.
  3. Rebate on bills discounted as on 1 April 2010 is Rs.22,500
  4. Provide Rs.5,00,000 for income tax.
  5. The directors decide to declare 10% dividend.

Prepare the profit and loss A/c in accordance with law. Make necessary assumptions, wherever necessary.