Accounting 2015

Question #6:

On 1st January, 2013 Mujahid & Co., acquired a machine on Hire Purchase from Punjab Company on

The terms of the agreement: The cash price of the machine was Rs. 200,000 and Rs 80,000 were to be

paid on the signing of the agreement. The balance was to be paid in annual installment of Rs. 40,000 plus

interest. While Interest was 10% per annum. Depreciation at 20% per annum is to be written off on the

Straight-Line Method.

Required: Show the accounts in the books of Mujahid & Co. and Machinery Account in the balance

Sheet of the purchaser as at 31st December 2014

Question #7:

The under mentioned balances appeared in the books of Saudi Co. Ltd. As on 31st December 2015

Particulars Rs. Particulars Rs.

Stocks 172,058 Authorized and issued capital:

Book debts 223,380 (60,000 shares of Rs. 10 each) 600,000

Investments 288,950 General reserve 250,000

Depreciation reserve 71,000 Unclaimed dividends 6,526

Cash balance 72,240 Trader creditors 36,858

Directors fees 1,800 Buildings 100,000

Interim dividend 15,000 Purchases 500,903

Interest (Cr) 8,544 Sales 983,947

Profit and loss account 1-1-2015 16,848 Manufacturing expenses 359,000

Staff provided fund 37,500 Establishment 26,814

General charges 31,078

Machinery 200,000

Motor vehicles 15,000

Furniture 5,000

From these balances and the following information Prepare The Company's Balance Sheet as on 31st

December 2015and Its Profit And Loss Account for the year ended on that date

1) The closing stock on 31st December were valued at Rs. 148,680

2) Provide Rs.10000 for depreciation of block and Rs. 1500 for the company's contribution to the staff

fund

3) Interest accrued on investment amounted to Rs. 2750

4) Establishment includes Rs. 6000 paid to the manager who is entitled to remuneration @ 5% of

profit ascertained to a minimum of Rs.10000 p.a.

Required: Make the Profit and Loss Account and Balance Sheet for the year 2015

Question #8:

Punjab Ltd. Faisalabad is contractor for the construction of a pier for the Seafront development

Company. The value of the contract is Rs. 300,000 and payment is by engineer's certificate subject to a

retention of 10% of the amount certified; this is to be held by the Seafront Development Company for

six months after the completion of the contract.

Wages on site Rs 41,260

Material delivered by supplier 58,966

Material from store 10,180

Hire of plant 21,030

Expenses charged 3,065

Overhead charged 8,330

Closing material 11,660

Work certified 150,000

Work uncertified 12,613

Payment received 135,000

Wages accrued on 30 September 2002 2,826

Material costing Rs. 3384 was damaged and had to be disposed of for Rs. 884

Required: Prepare contract Account and work in progress Account in the Book of contractor, also

shows the relevant items as would appear in the Balance sheet.

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