Taxmann's Basic Accounting

Preface It gives us immense pleasure to author this book on Basic Accounting meant for the non-commerce background students pursuing M.B.A. or equivalent courses. Although there is no dearth of books on the subject, but Accountancy in India is developing very fast now. With the changes in Accounting Standards, applicability of IFRS and Ind-AS, the new Companies Act, 2013, the whole impact of these interwoven laws and standards on the practical aspects of solving Accounting problems, required a thorough analysis and new sights which are aimed to be provided in the book and their interpretation in simplified language is given.

Each chapter begins with learning objectives that describes the issues that will be examined in the chapter and goes on to develop the theory followed by illustrative problems. The illustrations have been arranged in a systematic manner to ensure easy flawless understanding of the topic. At the end of each chapter, the graded illustrations have been given along with True and False questions covering the entire chapter.

The book covers basic chapters of Financial Accounting but the last chapter deals with “Preparation of Final Accounts of Companies” as per Ind-AS. This chapter is based on formats given in Division II to Schedule III of Companies Act, 2013. The notification of Ministry of Corporate Affairs dated 11th October, 2018 regarding amendment in Schedule III of Companies Act has also been duly incorporated in this chapter.

I-5

% # ! & % 2 0

I-6

We are greatly indebted to our teachers for imbibing in us the preliminary as well as higher knowledge of the subject. There are number of friends and well-wishers who have contributed directly or indirectly.

Our thanks are due to Mr. Mitra Pal Yadav and Mr. Sumit Dwivedi from Taxmann for carrying forward this project. We are thankful to the publisher and the editorial team of Taxmann publications for their support and bringing out this book.

We are thankful to our parents for their valuable inputs, support and co-operation without which the task would not have been possible. We express our gratitude to our daughter ‘Vatsla’ and son ‘Varad’ for their understanding without which this project would never have been completed.

Though all possible care has been taken to avoid any errors, we would be thankful if errors and mistakes are pointed out by learned teachers and students. Suggestions from the readers are solicited for the improvement of the book and would be incorporated in the next edition and will be duly acknowledged.

Dated: 1st June, 2019

CA. (Dr.) K.M. Bansal kamalmbansal@yahoo.co.in

Dr. Ritu Gupta rituguptadu@gmail.com

Contents PAGE

Preface

I-5

Chapter 1

1

INTRODUCTION TO ACCOUNTING

Chapter 2

29

BASIC ACCOUNTING TERMS

Chapter 3

49

THEORY BASE OF ACCOUNTING

Chapter 4

64

DOUBLE ENTRY SYSTEM

Chapter 5

75

ACCOUNTING EQUATION

Chapter 6

89

JOURNAL

Chapter 7

128

LEDGER

Chapter 8

143

TRIAL BALANCE

Chapter 9

FINAL ACCOUNTS (WITHOUT ADJUSTMENT)

172

Chapter 10

FINAL ACCOUNTS (WITH ADJUSTMENTS)

I-7

198

3 4 . % 4 . / #

I-8

PAGE

Chapter 11

DEPRECIATION

243

Chapter 12

FINAL ACCOUNTS OF COMPANIES

278

9

C H A P T E R

Final Accounts (Without Adjustment) Learning Outcomes

S T N E M E T A T 3 L A I C N A N I & F O G N I N A E E H T W O N + After studying this Chapter, you shall be able to:

S E I R T N E T N E M T S U J D A D N A G N I S O L C E H T D N A T S R E D N 5

T E E H 3 E C N A L A " D N A T N E M E T A T 3 E M O C N ) E R A P E R 0

E U N E V E 2 D N A L A T I P A # E R U T I D N E P X E F O E P Y T E H T Y F I T N E D )

S T N U O C C !

L A N I & F O S L A T N E M A D N U F E H T N R A E ,

F SG E T O N S N I TO T EN L P U MU R SU UO E R P CC TSOC I E D! H NT OF ET O HUWE T T OE S GTS A E NE EH I HP T M U 4T PO S A M4DL E O R E CDA H O PT I SR ES E DERI T UPP) T L E N C R

S EA NR T I TN GRE U NUEO C I HC T ES N C H !

E UT CL OR N CO A AN CF L AS I A S FE "& O S N DA NI N S OU D A I E T BTL L C N NEE A C UHM T FF Y ER L YO T R A A S A NTL S U MO S P E IT I S R MOE PA C OPO ERC E ER HP R NA 4O) 0

9.1 INTRODUCTION

EEEF EN A L O T S S A PBA A A L N A E CHU M T OS NCCI R G T L N ) EN A UAT O S I C P Y O N U T W I EOPPO D T DT RL N N U DMULA EL O P O E F FC G SE O NRCI N A N H I HR EIP I T PSE U DR4T YNR

OT E O T P C T I &N A ET S SE UF HAI S R T OU TRT CN NENECC A OPUTU! ID M POON S CSOGR US IR O N DECY PI F NN!T R DU S EIGI T ET PSNTH N CU EUINS AO DBDEI F A G E N SH U C R I NF T C 4 N I T N R A A E U YU S L H H T OI A E T C CT N WA GSF I CI ATSFNAF N U I I LE NRDO T A E U S NGAAT R T H I C A MA N4 F N I PE FR O U AFEN U R S T TN OS PP SC DU T A O M A S N " I MR MT EFO I OF NUGI T F N CG ONFF O U PAOO E TOH N RS I E0 MML R OCTU ONA CCST A S S CO WC S L EO A ENDO A T T R HFN HF A O 4O A'T SU R

-

-

M R I & G N I R U T C A F U N A N O .

M R l G N I R U T C A F U N A -

C

A G N I D A R 4

C

!

S S O , D N A T l O R 0

C

A G N I D A R 4

C

!

G N I R U T C A F U N A -

172

4 . % 4 3 5 * $ !

4 5 / ( 4 ) 7

3 4 .

5 / # # ! , ! . ) &

T E E H 3 E C N A L A "

T N U O C C !

S S O , D N A T l O R 0

1.

Y DL EG

R S NT I U Ol QRO EWR R P S I SE F I O NRN OUO T I II T D T C A N NE U I T L PA S I XV D ER LE RA E TD PI OPN RAU PCT O A S) FD T A E N USL OML L CEI T CI W AE T LUI A NN NE E lV H FET R O E D NN U OA N I E L T A V A T E R I R A P PA S EC A R ND PE E EEG HWR T A TH E NB C ) 2.

LS A S NE N OI SS R U E PB LE L A H FT I YM L O N R OF DD E NT AA FE I R NT Y WL OT E NA KR EA BP NE AS CE R MA S REE lRR U EI T U HD T I T D FNN E O PE YX P T X E I L E I D B D N AA N T A l OS REE PMM OO EC C HN N 4I I

3.

E G D U J O T L A I R E T A M

SL Y I E HT CA I I H R WP O FR O P EP R UA SD OE L S C O S L I C D S I ND OE I T B A MD RL OU O F H N S I RY OT I MI L EB T A I T Hl CO UR SP YE NH !T

TDE TD A U H HE ET B T H T A H D L CE ST T U E AS CI R I MALW A U H CD QYC E EL RER R R UBA E HP PDP CO NLM I U RE H OO EH WPB C E S YB EDE L T DVLB C O A L I D R U HSL T S O U S S DO T DHI O S H N EE I UOS L G U P T FS PN O

O AE TC V S EE O S BR RCI H DEA

NTS L HEE U D OTYHDE HNETNE SRHDAC A T O S EE L T L R O G I P P ON SN I T I C NUL E R NDU E A I

E E R D R B S PR G IE N GUF EVFI NCL I NPAOD H H I T N CS MT SCO T E E A P I A S PS MNXNS E EEUER EP R RR HX O O NC 4E & I

D TO N L SU UL OAO H MES ARG U ETN U HF I N T I TNA U I BDM E DER V EI R ED R S UCND CEAO NRDI E I R OE I NBR P EOE ET E BDPR U EETT N VTE C U AE R F R HP N SXUI E ECD S E NENG ERIR PADA E S XT GH El R C EE A E R UNHB E C T BSO A T N IR E EHNO O UTI F NDT D ENRE VAOR E PR Y R E VAF NA E N EE ED HHH E 7I S4B

5.

T N U O C C !

G N I D A R 4

F O S U T A T S E H T G N I

WE OM HT I SF TO E ET HI N 3O EP CR NA AU L L A C I "T R SA E DP UA L T C NA I S TA ) S E T N I T EL I I MB EA T I A L T D 3 N NA OS I T T I E S S OS 0A

OFO S SOL RWA E EE NI R NVA AI RG MA N F I ADW O HNL L CAO UEF SU E RH NT I 4 W DO S EH S R E SN A PE TS I EE U R P B H SE EE H BC T NF OA T O L DAN E"I O R I DT I U NS QA O ET P R L

N A D EEI R R CA M A NG EA TT E N ANR UTIS OSFI CEDH C NT AMAI N O YD LCT A NIE L NI I R I B E F E HAD ET T I I R S F TO E N A HH RO 4T PC

4.

S I T )

E C N A L A B L A I R T F O N O I T A R A P E R P R E S T T F R A A SP T R O A W T T S SG T N N I UW OO CL L E H T F O T L U S E R T E N E H T T U O S T DR NA lP OO T W DT EO R T A N PI ED R E PD I SV I I TD ) B T U N ES S MI E) T T A

T S 3 N O ET I MA R OE CP NO )

b

M R I & G N I R U T C A F U N A N O .

M R l G N I R U T C A F U N A -

CO C AF

L !

O A T S T NN S II E F O E , H FD E D 3 OD S N E I S A C V E I T N C D l A O O L Y R A RL 0 " PN EI HA 4 M

a

173

9.2 BASIC PRINCIPLES GOVERNING FINAL ACCOUNTS

4 . % 4 3 5 * $ !

4 5 / ( 4 ) 7

3 4 .

5 / # # ! , ! . ) &

174

TEI S EI T FHH A O T T L RNF U CPI O L S T E A S L G CO U RAS OG T T E S R SET I S E PHR H E4I T F

T D S ED EH TR N S T A R R I U S F N CI

RT EN TE N HI ) CU T S

NO D S SO OC L T LOCC N USSG! OSSN S CODI S CROD O G AR A, OR GT LO A D NDFAN O I A F E F TO FNS T I O R F O O S T NACN R OE U R 0 T I I E TF OO A V O CT R ROC A D PPSAE E SL ES LR R A R A POS NF E R I FG S FF O N FA FOO SO S S R S E TE NT CN O S O CI I RUXT T A POER N U EMEA O HAH PC T EC ETR NT HSP ) I A

9.3 TRADING ACCOUNT

SE TS SLS D I R A S L E K E D N I A U O D O T R E O S I R

P I OTI R S E B S G T BEA E TCE E ERI S E F " D EHR D HO A HTE EVT H T E P N T SERAN B C H C S NIO W O UR O S L I S L T DI R OP OU T DA S I NW HR CP E EF A SU C M R PO TP T!M E N E I H P O T R T DESUGR I A N A A H O F N N E ESE I H ATCCD Y D RY R C 4 E A E T HA AT COT EAS

T C YWR NFOSRU 4 S A L N l B AL TA R D O M A L S I TE SUT A E A R H I R T E L B D D O T E E D E E F T T E R N I O US R A T HO E I B I S T P L MLE T B C E F F A A

D NSEA E O H H R E EDIADR T H N YE S T V R CEA A) HE 4 K R A R O4 T U C A G HSN T O N N I

N LDO0SI NO T L O Y ER E D I I OS OT W S V D E W T C T G R NN O TGUNAL TN I L H A F A N D O CO P GENI H N A U O G R E NN F E T E O RRU R I S S PEP IRP CA S P O O N H C N S HNT PO TR L E A I

C E O C I O M P G T U S R NT EO N N IN E UDE E H H E UI S SE E PS EI T T A HR OW B H) TL OT S HFUN4E CO T L CO CL /

L I E S T H S R E !O EA W R N B U G S C C E GF H U E U N N 0 E F NE C S OOA AR OAR E T H E I L L E R R T D HMRH U A A HB H TT AE 4AO CBP ) T RD 4U L EC HN 4I 1. Opening Stock

2. Purchases and purchases returns

E S U L A N O S R E P R O F R O T E I R P O R P E H T Y B N E K A T S D O O '

TDI FOEO F DNLG BI O TST O EOEN E A I I U T G R N I S N R D H N F W T E A N E I WACE I V O ED HD PE DL OTRK B CDN A L N EW DRUT O R D H A UAAF OOPT O L T T GPEO PNRE U S M ( R H N T OU S)EH EIT O D W4 H E D H S T H SOFN O I OL T N T S S T I OAPE S U A E S ) O I GS S O E T WD TGC RS E A R N NO N E SS E ON C L W OF O S GE U T UI A A I S L I T O L DSAP R X L A R

C S G W E EE U OE T E NMF N I R TF

A N P I N T S R W S A TD E I C A A N US E OYA L M E A CU OC B DNHR HRS NB OATT GACE CIN I E L D R N I G NA US OE P FS EFS A I I ) H O X R E G V E A E A E ST H K R A N N T E T M DT A I SC N O OE R OT C M E I N S A U A B T T E S OD I E S L ES OB C A R NP F S H I

C E E E E UR N R O D T C OG E PEDT EH A T G T T T R K XHOO S N N NP A R N ETRS X I O I A H OGT EE

N K C T EOPL T I T H W R HC S NAO D EAHTN E GE TO C EP U A O HMU HH UR R TO R T T 4GDAM T DSEC OA D S ONI FS UE I C ERD I C R T B O AT A A A H E RRTE PT S A EN G BUEH M D R T R H C S N OBE E EI RT E ENTF T F TC X N l R I G E E lD EO DSN A T A R A U E E SR O EM R O F4 HN TT 7I YE M T O C ) ESYO R HNO S E T T P E C LX L R AA I EF T (c)

E L P M A S S A N E V I G S D O O '

(b)

Y T I R A H # S A N E V I G S D O O '

(a)

3. Direct Expenses

(a) Carriage or freight or cartage inwards

(b) Manufacturing Wages

-

4 . % 4 3 5 * $ !

4 5 / ( 4 ) 7

3 4 .

5 / # # ! , ! . ) &

D E D D A E B D L U O H S T I T E S S A N A F O N O I T A L L A

T T S E NS I S RA OE F H DT I F A PO T ES R O A C SE E H GT AO WT

F MEYO RHAT l4MD I E ES E R HEE R L T C A HE YS B 4H T I T SD X O DE AT OR OC4D E G DS S FAEO D O L LD L C EE S L I W!D A E S SU E LA L B A A T H O O S6T T A R E ECO R HHX A T S STAE O T L BTA C S E E S mSL E T A ED E S R N UE TL ) C DO I NU3 L TC O ) N S IL

D TAT OO N S I NN U R E O SRC PE U T C EOE !

HDR T TSG GNEI N L U NO A D I S R A UMER DAB4

E S HMEI U T D SL I FT N A

O AVAY R NVETT WRLNN E B OS AEE M DNZ T OOITN L S E GCA U EFEJ M HORD T T T S AU N E NON ND J I I T GN DAA NE NSG I VAAN Y L TEI SNS DOOCW O OCCNL A E L OH L FA O GT O F DRRBE L L E E A O H I SPWR T NSOT H U!L G TEU ED H A T HO O T R IDEH E R OE UDT T I L S SPA S T R K EVU E O H F SOO T E Y NB R FA EE TOW ) VH D

I LG NA T EI SL YI N EK L A HC D T U E O TT SD A R SUO MI SC SI RH E TR lT ) 8 8 8

R $

T N U O C C !

K C O T 3 G N I S O L #

8 8 8

C

!

G N I D A R 4 O 4

T EEI HI DB T E S OI TD T E DH SET R MC F ED O T I T NA EAH H T E T D N I A DS H EI TT R BE E T ER N DO EF M GOS NL SI I E A V T D AO I HT S T REI E HD T T E F R !TC N U E

OHI T CTF CFO !OR L 0 GA T S NO S I T D O AER R ' 4HS T FI F) O S S SD E E EC DRX I A S PE TM E N H AOT VCE E D E L R E I A S R

T N A V E L E R E H T E R A G N I W O L L O F E H 4

S E I R T N E G N I S O L C

Closing entries in respect of Trading Account

175

The Trading Account is credited with the following: 1. Sale and sales returns

2. Closing Stock

Balancing of Trading Account

T N U O C C !

G N I D A R 4 F O T I B E D E H T N O S M E T I R O &

8 8 8 8 8 8 8 8 8 8 8 8

8 8 8

T N U O C C !

G N I D A R 4 O 4

8 8 8

T N U O C C !

S S O , D N A T l O R 0 O 4

T N U O C C !

S S O ,

T l O R 0

8 8 8

T N U O C C !

L E U & D N A R E W O 0 O 4

8 8 8

D E S S A P E B D L U O W Y R T N E G N I W O L L O F S S O L F O E S A C N )

8 8 8 8 8 8

T N U O C C !

S E G A 7 O 4

T N U O C C !

G N I D A R 4

8 8 8

T l O R 0 S S O R ' R O &

R $

T N U O C C !

S E S A H C R U 0 O 4

T N U O C C !

K C O T 3 G N I S O L #

R $

T N U O C C !

K C O T 3 G N I N E P / O 4

T N U O C C !

S E L A 3

R

R $ $

T N U O C C !

G N I D A R 4 F O T I D E R # E H T N O S M E T I R O &

R $

T N U O C C !

G N I D A R 4

8 8 8

T N U O C C !

G N I D A R 4 O 4

4 . % 4 3 5 * $ !

4 5 / ( 4 ) 7

3 4 .

5 / # # ! , ! . ) &

176

S W O L L O F S A S I T N U O C C !

G N I D A R 4 F O T A M R O F E H 4 Format of Trading Account:

T N U O M !

S R A L U C I T R A 0 T N U O M !

S R A L U C I T R A 0

8 8 8 8 8 8 8 8 8 8 8 8 8 8 8

S N R U T E 2

S S E ,

O T D E R R C E

F S N! S AS R O T S, S D ON ,A Sl T S OO RR '0 Y "

K C O T 3 G N I S O L # Y "

TE HG A GT I R E RA &# O 4

D N A I O R T C /

S E L A 3 Y "

S D S R E A S N W E N P ) X E % G S T A E I R G C R E A I R A 7 $ # O O O 4 4 4

8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8 8

S N R U T E 2

S S E , S E S A H C R U 0 O 4

8 8 8

K C O T 3 G N I N E P / O 4

S N A R T T I F O R 0T O SD S E OR R RE 'F O 4 -

8 8 8

8 8 8 8 8 8 C

!

S S O , D N A T l O R 0

R A E Y E H T R O F N O I T A M R O F

T N I N GU NO I C WC O! L L G O N F I ED HA T R U4 OE YR A DP EE DR I 0 V O R P

S A HH SC E R S A I R PRT E S T

N

%G UN I ND AN -E Illustration 9.1

L I R P !

T S

N O S A K C O T 3

I O R T C /

T H G I E R &

`

S D R A W N ) E G A I R R A #

S E G A 7

S S O R '

S E L A 3

S N R U T E 2 S E L A 3

K C O T 3 F O S E S A H C R U 0

S D R A W T U / S N R U T E 2

N O S A K C O T 3 G N I S O L #

4 . % 4 3 5 * $ !

4 5 / ( 4 ) 7

3 4 .

5 / # # ! , ! . ) &

H C R A T S

D E D N E R A E Y E H T R O &

T N U O M !

S E I R A L A 3 E C l F /

S E T A 2 D N A T N E 2 E C l F /

G N I T H G I ,

S E E & T I D U !

S E S N E P X % L A R E N E '

Y R E N O I T A T 3 D N A G N I T N I R 0

1. Administrative Expenses:

Items Debited to Profit & Loss A/c:

S N R U T E 2

S S E ,

YESTE D ND C S HE SS T T BHO E O N E G E T N G 4 A A T R I R DHG I I D TTREF ET D S G T A I E O F R IENNOO HAR R R C UWHIUPRCOPE L O L CT S4!

CY0GTDR

NR R N N C O A T

I E I T OEE E N !

A V K ND I SS T I DSO UI S CS S E S E O E A S I OT T T CSO L PICH T E I A M 4 B R TNCI,T B U !

E S S E

MDC EDD E NOGD ONT N DI N RCN A ORCEE E A OCI A S D A L T H D D L SI I A A G T V E DSATF I V EIROONESBD I E S NH4TRIR E R4 S0TA DEC N N Y S I A K B F E E S R D OO I ED R PEMAL L ODS S T TI E N SBOS I S S R E S D F E E E E T E O I L O SLR A I S C A P R RPE E R E S G T S X I PGL A T I T E EEU L N TNFDBA E I M R E E N E TRA DSHADOY NI E N T R EUSEED4SRCE N S O E H

D UC HOO N S PII T CLITLT T S N C H ECRTONEEXCC E T I E A T O I P A D SX R DS A SD I E R EE L M T E E E T A R U IC R S S A L NR F CU R NRENI O L O E E C A E SE S R F H I CT S PDEPET PT NXNHXMN RSO OA AEA4EOE S T T R PO ET TSM T N S T D R E N V R N E T E C EAG I ERS

R N ARTRU AE E A F M A A O !

EV S R P PIOP ER CS SS T E N, EMN E TAS EI IECI R F !

T H F R N PI R TNI UI TSE 4O I SFOFEMD 0 E

S V P O I E C L MR XDUODT A HA O TT PEAA,AE S T )

f

D EC R R

E !

F S S NS AO R , T TD l N OA RT 0l O SR S O0 RO 'T O 4

e

K C O T 3 G N I S O L # Y "

T H G I E R & O 4

d

S N R U T E 2

S S E ,

S D R A W N ) E G S I A O E I R R R G T A C A 7 / # O O O 4 4 4

c

S E S A H C R U 0 O 4

b

S E L A 3 Y "

K C O T 3 G N I N E P / O 4

a

S R A L U C I T R A 0 T N U O M !

S R A L U C I T R A 0

9.4 PROFIT & LOSS ACCOUNT

177

Solution

In the books of Manu Enterprises Trading account

a

b

c

d

e

f

T F A R D R E V O K N A B N O T S E R E T N )

E S A E , E C N A N I & N I T N E M E L E T S E R E T N ) T F E H T Y B S S O ,

S T E S S A D E X l F O E L A S N O S S O ,

E C N A R U S N I Y B D E R E V O C T O N T N E T X E E H T O T E R l Y B S S O ,

D E V I E C E R T N U O C S I D D N A D E W O L L A T N U O C S I $

D E R E V O C E R T B E D D A B D N A S T B E D D A "

S E I R T N E G N I S O L C T N A V E L E R E H T

Closing entries in respect of Profit and Loss Account:

E R A G N I W O L L O F E H 4

3.

D E V I E C E R T S E R E T N I D N A E S N E P X E T S E R E T N )

2.

N I A G Y R A N I D R O A R T X %

T I B E D E H T O T E N O C

! ,

0 N I Y L E T A R A P E S

E ND WS I OT HI SD E ER R C A E SH MT EO T T I R GE NH I T WO OD L L N O A F EE D HI 4S

1.

S T E S S A D E X l F O E L A S N O T l O R 0

6.

D E V I E C E R T N U O C S I $

5.

D E V I E C E R T N E 2

4.

D E V I E C E R T S E R E T N )

3.

T N U O C C A G N I D A R 4 R E P S A T l O R 0 S S O R '

2.

N A O , N O T S E R E T N )

c

S E S N E P X E G N I K C A 0

b

S E L A S N O E G A I R R A # D N A T H G I E R &

4. Abnormal Items:

a

S E S N E P X % N A 6 Y R E V I L E $

c

G N I S I T R E V D !

b

T N E 2 N W O D O '

3. Finance Charges:

a

S E I R A L A 3 S

N E M S E L A 3

2. Selling and Distribution Expenses:

1.

4 . % 4 3 5 * $ !

4 5 / ( 4 ) 7

3 4 .

5 / # # ! , ! . ) &

178

Items Credited to Profit & Loss A/c:

NOTE:

C

! ,

0 F O T I B E D E H T N O S M E T I R O &

8 8 8

R $

T N U O C C !

S S O ,

T l O R 0

8 8 8

T N U O C C !

S E I R A L A 3 O 4

4 . % 4 3 5 * $ !

4 5 / ( 4 ) 7

3 4 .

5 / # # ! , ! . ) &

T N U O C C !

T S E R E T N ) O 4 T N U O C C !

T N E 2 O 4

C

! ,

0 F O T I D E R # E H T N O S M E T I R O &

8 8 8

8 8 8

D E S S A P E B D L U O W Y R T N E G N I W O L L O F S S O L F O E S A C N ) T N U O C C !

L A T I P A #

8 8 8

T N U O C C !

L A T I P A # O 4

8 8 8

T N U O C C !

S S O ,

T l O R 0

8 8 8 8 8 8

T l O R 0 T E .

R O &

R $

T N U O C C !

S S O ,

T l O R 0 O 4

R $

T N U O C C !

D E R E V O C E R T B E $ D A "

S 8 W 8 O L 8 L O F S A S I T N U O C C !

S S O ,

T I F O R 0 F O T A M R O F E T H N U 4 O C C !

S S O ,

T l O R 0 O 4

8 8 8

8 8 8 8 8 8 8 8 8 8 8 8 8 8 8

O E T M D E O R C R N E ) F S S N U A O R E T N S A S L L O E , C T S I E - .

Y Y " " E C N A V D !

S S E ,

T N U O C C !

L A T I P A #

O T D E R R E F S N A R T TC

l !

OL RA 0I T TP E A .#

D E R E V O C E 2 T B E $ D A " Y " N O I S SD IE MV I E MC OE #2 Y "

D E W O L L !

T N U O C S I $

T l O R 0 S S O R ' Y "

G N I D N A T S T U /

$ $ !

O O O 4 4 4

S D R A W T U / E G A I R R A #

8 8 8 8 8 8 8 8 8 8 8 8 8 8 8

D I A P S E I R A L A 3

8 8 8 8 8 8

E R I & Y B S S O ,

S E S N E P X % L A G E ,

O 4

N O I T A I C E R P E $

O O O 4 4 4

E S N E P X % T S E R E T N ) O 4

8 8 8 8 8 8 8 8 8

D E V I E C E 2 T N E 2 Y "

T N U 8 8 O 8 8 M 8 8 !

S R A L U C I T R A 0 T N U O M !

S R A L U C I T R A 0

8 8 8

8 8 8

S R E D A R 4 E S I R N U 3 H T I W N O I T A L E R N I N O I T A M R O F N I G N I W O L L O F E H T R E D I S N O #

T I TS S E D

E G R UR E A !H T N C ) S LS

A E G M G E R A R A G HN,E # L E S O 4 I K

E T I N A R

I A A C L E "E A G Y R 3 P A R T EES $NO O P T I

E A

T N 3 O DE H EM P

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US S TO N SE

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E EU

EL F %O Y C T C S I I F S

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R $ $

T N U O C C !

D E V I E C E 2 T S E R E T N )

`

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8 8 8 8 8 8 8 8 8

T N U O C C !

G N I S I T R E V D !

O 4

Format of P & L Account:

179

Illustration 9.2

4 . % 4 3 5 * $ !

4 5 / ( 4 ) 7

3 4 .

5 / # # ! , ! . ) &

180

N O D E D N E R A E Y E H T R O F S R E D A R T E S I R N U 3 F O T N U O C C A S S O L D N A

T I F O H RC PR EA R M A PT ES R

0 Solution

In the books of Sunrise traders

H C R A T S

D E D N E R A E Y E H T R O & Profit & Loss Account

T N U O M !

T l O R 0 S S O R '

D E V I E C E 2 T S E R E T N )

E M O C N ) S U O E N A L L E C S I -

D E V I E C E 2 T N U O C S I $

Y Y Y Y " " " "

S E E S F E N G Y E O R C R I T I A N A & I S H A Y T C # E L I E B R U R K A S P N S S L N A O A O E 3 " # , $ O O O O O 4 4 4 4 4

S E G R A H C S Y Y E R T E I E C F N I T T R O I I D C T U L A E T ! % 3 O O O 4 4 4

E G A D T E S O S W P O E L G A L ES R NM A H T OA N C U HR PG L O A EL E C L G S EE E I , $ 44 O O O 4 4 4

S T T B l E T O D S R E P R D E T A T E N . " ) O O O 4 4 4

T Y TFSSSN I T O U T E I H E T"NI E T T I S T N F M I

NSE EO SOT !

I ) N NRTT T I N

E S A S T A0E A T A E O FDM S T DA O P N ELAMEY SA R R L T E A L OOA I CA L I T PFC P TC I L S R E N I !

M E O L B P A I A R CA G

AN S N S CI I T L NHASN IIF I S D DD EOSTTU O I NA E I HN4E R O AR R C S4ETF HEC H T PSO ST T E E A W A EA SO TC S S L HA A RA S A T A TN HC MNN LEDS A O R A N O L T US T I T O I A O ) R OR O F BC YL NE L T EOPTL AECE HT RNATHAP T TAEUNTND GNLMSOFA N ZOT NAUE5I A C I T T R SOL I A WRT E A OENE T T OORS HDSR A I HPAL I DNS SMPA T F I R E D TIAN O A E N DNH SROL S EI E A I O U E T T SC R HE F M) I CA

N T DSI EE TP CA F T EOR T E N E P A L A R A L R T AA S DAAPP L B A P A DAG S R N S E I " I SA A R N I L N T

T PE TS T OE U I E S H E E E C E S I EI O R HS HGT L I HT I C L 3RA3E3RI N A G E CEIEEBN A CP CSCHI I NA!NUNT, W T S ABAED AA S L L L SNO E A A OA A S, H H" "T "A CAS

FvSS G O T NME TI E A S T S MPI A RURD O E O RH E F 'T X Dh I E ES GF BM OT S I R RTE C E GS S T S N E O I A R T WT P T N OTUE NEPR R SE SR I N U E(A R EC S E E HEMK I T I I L HT G G CTN N UNI I SEPD S UA SE S !N OE RH I S'N UT O BN M EA T TM A R R OOO PPC RMA OIR CE E NRD OAN NvU RGE ONR I F U L L T T A E A EHN HSR SRA EAI C-L NhM I ADS L A NF BAO

Arrangement of Assets and Liabilities

S R A L U C I T R A 0 T N U O M !

S R A L U C I T R A 0

9.5 BALANCE SHEET

i.e.

4 . % 4 3 5 * $ !

4 5 / ( 4 ) 7

3 4 .

5 / # # ! , ! . ) &

N I N W O H S E R E A C SN E MN EA T I M SR UE OP I R R A VO Y ET I HD T I HU CQ I I L H E WB NY I RA E DM RR OE D ER HO T S SI NH A4 E T ME E GH N3 I L L E A C HN SA R L A A -" E C T H E T

L EI L HW T SD NO AO E' ME K YL I T I S D T I E U S S QA I , D I U Q I L T S A E L D N A T S R I F N W O H S S I H S A C E KT

I L S T A E L S N S I A D DE I U S O QL I L C T S I S OD S MI S T N E M T S E V N ) M R E T T R O H 3

S R O T I D E R # Y R D N U 3

E L B A V I E C E 2 S L L I "

S E S N E P X % G N I D N A T S T U /

S R O T B E $ Y R D N U 3

S N A O , M R E T T R O H 3

Y R O T N E V N ) G N I S O L #

S N A O L M R E T G N O ,

S T N E M T S E V N ) M R E 4 G N O ,

S U L P R U 3 D N A E V R E S E 2

E R U T I N R U &

L A T I P A #

XXX

L L I W D O O '

XXX

Y R E N I H C A D N A T N A L 0

SS NI AM EE MI T ED CI NU EQ I NL AT MS RO E M 0 D N A T S R I F N W O H S S I M E T I D I U Q I L T S A E L T N

T ES NA AL N MI RN E PW O EH HS T

L L I W D O O '

L A T I P A #

Y R E N I H C A D N A T N A L 0

S U L P R U 3 D N A E V R E S E 2

E R U T I N R U &

S N A O L M R E T G N O ,

S T N E M T S E V N ) M R E 4 G N O ,

S N A O , M R E T T R O H 3

Y R O T N E V N ) G N I S O L #

S E S N E P X % G N I D N A T S T U /

S R O T B E $ Y R D N U 3

S R O T I D E R # Y R D N U 3

E L B A V I E C E 2 S L L I "

E L B A Y A 0 S L L I "

XXX

K N A " T A D N A D N A H N I H S A #

XXX

S T N E M T S E V N ) M R E T T R O H 3

L U P I 6

S T N U O C C !

S S O , D N AN O TI I T F A O RM 0R O DF NN AI GG NI N I D W AO R L L 4O EF HE T H DT ES R E A D PV I EO R R PP GS NE I S V I AR HP R RE E T T N F !%

Illustration 9.3

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX

XXX XXX

XXX XXX

XXX XXX

XXX XXX

Amount Liabilities

Amount Assets

K N A " T A D N A D N A H N I H S A #

E L B A Y A 0 S L L I "

FORMAT of BALANCE SHEET (In order of Permanence)

i.e.

XXX XXX

XXX XXX

XXX XXX

XXX XXX

XXX XXX

XXX XXX

XXX XXX

XXX XXX

Amount Liabilities Amount Assets

181

FORMAT of BALANCE SHEET (In order of Liquidity)

4 . % 4 3 5 * $ !

4 5 / ( 4 ) 7

3 4 .

5 / # # ! , ! . ) &

182

K N A " T A H S A #

D N A H N I H S A #

L L I W D O O '

L A T I P A #

Y R O T N E V N ) G N I S O L #

E L B A V I E C E 2 S L L I "

S N A O , M R E T T R O H 3

E L B A Y A 0 S L L I "

T l O R 0 T E .

S R O T I D E R # Y R D N U 3

S G N I W A R $

S E I R A L A 3 G N I D N A T S T U /

L L I W D O O '

Amount

Y R E N I H C A D N A T N A L 0

N O I T A I C E R P E $

0

G N I D L I U " D N A D N A ,

S N A S O T G l O N , R I 0 W M A R T R E E L .

T $ T A T R O I P A H # 3

N O I T A I C E R P E $

0

N O I T A I C E R P E $ E R U 0 T I N R U &

E L B A Y A 0 S L L I "

S E I R A L A 3 G N I D N A T S T U /

S R O T I D E R # Y R D N U 3

S T N E M T S E V N ) M R E 4 G N O ,

Y R O T N E V N ) G N I S O L #

S R O T B E $

S T B E $ D A "

0

E L B A V I E C E 2 S L L I "

LESS:

S T B E D D A B R O F N O I S I V O R 0

S S E ,

S R O T B E $

LESS:

K N A " T A H S A #

D N A H N I H S A #

8,66,000

8,66,000

S T N E M T S E V N ) M R E 4 G N O ,

LESS:

T S O #

E R U T I N R U &

Add

T S O #

G N I D L I U " D N A D N A ,

LESS:

Less

`

Liabilities

Amount Assets

T S O #

Y R E N I H C A D N A T N A L 0

`

`

Solution

In the books of Vipul Enterprises

Balance Sheet

As on 31st March, 2019

Basic Accounting AUTHOR PUBLISHER DATE OF PUBLICATION EDITION ISBN NO NO. OF PAGES BINDING TYPE

: : : : : : :

K.M. Bansal, Ritu Gupta TAXMANN July 2022 Reprint 2022 9789356222984 360 PAPERBACK

Rs. : 475 | USD : 37

Description This book provides a thorough analysis & new insights on basic accounting and interpretation in simple language.

This book is specially prepared for non-commerce background students pursuing MBA or equivalent courses.

The Present Publication is the Reprint 2022 Edition, authored by CA (Dr.) K.M. Bansal & Dr. Ritu Gupta, with the following noteworthy features: · [Simple, Systematic & Comprehensive Explanation] The subject matter is presented in a simple, systematic method along with a comprehensive explanation · [Student-Oriented Book] This book has been developed keeping in mind the following factors: o

Interaction of the author/teacher with their students in the classroom

o

Shaped by the authors’/teachers' experience of teaching the subject matter at different levels

o

Reactions and responses of students have also been incorporated at different places in the book

· [Learning Objectives] that describes the issues that are examined in each chapter · [Theory Supplemented by Illustrative Problems] are given in this book · [Graded Illustrations] are provided at the end of each chapter · [True and False Questions] are also given, covering the entire chapter · [Preparation of Final Accounts of Company as per Ind-AS] based on the following: o

Formats given in Division II to Schedule III of the Companies Act 2013

o

MCA Notification regarding amendment in Schedule III of the Companies Act 2013 has been duly incorporated

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