Adjusted Trial Balance Problems and Solutions
Arjun EP
Problems and Solutions
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු =
PROBLEM: 5
The trial balance of XYZ Company Ltd as on 31st December 2019 is given below:
|
Particulars |
Amount Dr |
Amount Cr |
|
|
Capital Sales Sundry receipt Purchase Wages Carriage outward Salary Fixed assets Preliminary expenses Creditors Debtors Prepaid insurance |
− − − 2,95,000 20,000 5,000 30,000 2,50,000 50,000 − 40,000 10,000 |
2,50,000 3,50,000 50,000 − − − − − − 50,000 − − |
|
|
Total |
7,00,000 |
7,00,000 |
|
Additional information:
a. Preliminary expenses written off by Rs 10,000.
b. Wages outstanding Rs 5,000.
c. Prepaid insurance expired by Rs 8,000.
d. Goods destroyed by Rs 10,000 but insurance company accepted claim only Rs 7,000.
e. Required: Journal entries for adjustments and adjusted trial balance
[Answer: Adjustment = 33,000; Adjusted TB = 7,05,000;
SOLUTION:
Journal Entries
|
Date |
Particulars |
|
LF |
Amount Dr |
Amount Dr |
|
a |
Preliminary expenses written off account To Preliminary expenses account (Being: preliminary expenses written off) |
Dr
|
|
10,000 |
10,000 |
|
b |
Wages account To Outstanding wages account (Being: wages due for the period) |
Dr
|
|
5,000 |
5,000 |
|
c |
Prepaid insurance expired account To Prepaid insurance account (Being: insurance paid in advance) |
Dr
|
|
8,000 |
8,000 |
|
d |
Insurance claim account P&L (income statement) account To Purchase account (Being: goods destroyed and partial claim accepted) |
Dr Dr |
|
7,000 3,000 |
10,000 |
Adjusted Trial Balance
|
Particulars |
Part 1 |
Part 2 |
Part 3 |
|
|||
|
Trial balance |
Adjustments |
Adjusted trial balance |
|
||||
|
Dr |
Cr |
Dr |
Cr |
Dr |
Cr |
|
|
|
Capital |
|
2,50,000 |
|
|
|
2,50,000 |
|
|
Sales |
|
3,50,000 |
|
|
|
3,50,000 |
|
|
Sundry receipt |
|
50,000 |
|
|
|
50,000 |
|
|
Purchase |
2,95,000 |
|
|
10,000D |
2,85,000 |
|
|
|
Wages |
20,000 |
|
5,000B |
|
25,000 |
|
|
|
Carriage outward |
5,000 |
|
|
|
5,000 |
|
|
|
Salary |
30,000 |
|
|
|
30,000 |
|
|
|
Fixed assets |
2,50,000 |
|
|
|
2,50,000 |
|
|
|
Preliminary expenses |
50,000 |
|
|
10,000A |
40,000 |
|
|
|
Creditors |
|
50,000 |
|
|
|
50,000 |
|
|
Debtors |
40,000 |
|
|
|
40,000 |
|
|
|
Prepaid insurance |
10,000 |
|
|
8,000C |
2,000 |
|
|
|
|
7,00,000 |
7,00,000 |
|
|
|
|
|
|
Preliminary exp written off |
|
|
10,000A |
|
10,000 |
|
|
|
Outstanding wages |
|
|
|
5,000B |
|
5,000 |
|
|
Prepaid insurance expired |
|
|
8,000C |
|
8,000C |
|
|
|
Loss by fire Insurance claim |
|
|
7,000D 3,000D |
|
7,000D 3,000D |
|
|
|
Total |
|
|
33,000 |
33,000 |
7,05,000 |
7,05,000 |
|
###########
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###########
PROBLEM: 6
The trial balance of Metro Company Ltd as on 31 Dec 2019 is given below:
|
Particulars |
Amount Dr |
Particulars |
Amount Cr |
|
|
Opening stock Purchase Wages and salaries Prepaid insurance Rent Cash and bank Account receivable Fixed assets
|
40,000 1,80,000 70,000 5,000 19,000 36,000 1,50,000 1,00,000 |
Capital Sales General reserve Account payable Commission
|
1,50,000 3,50,000 50,000 20,000 30,000 |
|
|
6,00,000 |
6,00,000 |
|
Additional information:
a. Outstanding rent Rs 1,000.
b. Provide interest on capital @ 10%.
c. Commission includes Rs 5,000 received in advance.
d. Prepaid insurance expired by Rs 3,000.
Required: Journal entries for adjustments and adjusted trial balance
[Answer: Adjustment = 24,000; Adjusted TB = 616,000]
SOLUTION:
Journal Entries
|
Date |
Particulars |
|
LF |
Amount Dr |
Amount Cr |
|
a |
Rent account To Outstanding rent account (Being: rent payable) |
Dr
|
|
1,000 |
1,000 |
|
b |
Interest on capital account To Capital account (Being: interest provided on capital 150,000 @ 10%) |
Dr
|
|
15,000 |
15,000 |
|
c |
Commission account To Advance commission account (Being: commission received in advance) |
Dr
|
|
5,000 |
5,000 |
|
d |
Prepaid insurance expired account To Prepaid insurance account (Being: prepaid insurance expired) |
Dr
|
|
3,000 |
3,000 |
Adjusted Trial Balance
|
Particulars |
Part 1 |
Part 2 |
Part 3 |
|||
|
Trial balance |
Adjustments |
Adjusted TB |
||||
|
Dr |
Cr |
Dr |
Cr |
Dr |
Cr |
|
|
Opening stock |
40,000 |
|
|
|
40,000 |
|
|
Purchase |
180,000 |
|
|
|
180,000 |
|
|
Wages and salary |
70,000 |
|
|
|
70,000 |
|
|
Prepaid insurance |
5,000 |
|
|
3,000d |
2,000 |
|
|
Rent |
19,000 |
|
1,000a |
|
20,000 |
|
|
Cash |
36,000 |
|
|
|
36,000 |
|
|
Account receivable |
150,000 |
|
|
|
150,000 |
|
|
Fixed assets |
100,000 |
|
|
|
100,000 |
|
|
Capital |
|
150,000 |
|
15,000c |
|
165,000 |
|
Sales |
|
350,000 |
|
|
|
350,000 |
|
General reserve |
|
50,000 |
|
|
|
50,000 |
|
Account payable |
|
20,000 |
|
|
|
20,000 |
|
Commission received |
|
30,000 |
5,000c |
|
|
25,000 |
|
|
600,000 |
600,000 |
|
|
|
|
|
Outstanding rent |
|
|
|
1,000a |
|
1,000 |
|
Interest on capital |
|
|
15,000c |
|
15,000 |
|
|
Advance commission |
|
|
|
5,000c |
|
5,000 |
|
Prepaid insurance expired |
|
|
3,000d |
|
3,000 |
|
|
Total |
|
|
24,000 |
24,000 |
616,000 |
616,000 |
********
|
PROBLEMS AND ANSWERS |
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු =
Basic Problem: 5
The trial balance of AS Company Ltd as on 31 December 2019 is given below:
|
Particulars |
Amount Dr |
Particulars |
Amount Cr |
|
|
Opening stock Purchase Wages and salaries Discount allowed Rent Cash Account receivable Machinery |
40,000 2,00,000 50,000 5,000 19,000 1,36,000 50,000 1,00,000 |
Capital Sales General reserve Account payable Advance commission
|
1,00,000 4,00,000 50,000 30,000 20,000 |
|
|
6,00,000 |
6,00,000 |
|
Additional information:
a. Advance commission earned Rs 15,000 for the year.
b. Outstanding rent Rs 6,000.
c. Bad debts is to be written off Rs 10,000.
d. Provision for bad debts is to be maintained @10%.
Required: Journal entry and work sheet
[Answer: Adjustment = 35,000; Adjusted TB = 606,000]
Basic Problem: 6
The trial balance of BH Company Ltd as on 31 December 2019 is given below:
|
Particulars |
Amount Dr |
Particulars |
Amount Cr |
|
|
Opening stock Purchase Wages and salaries Insurance Rent Cash and bank Bills receivable Land and building |
60,000 2,00,000 50,000 5,000 19,000 36,000 1,50,000 1,00,000 |
Capital Sales General reserve Bills payable Commission received
|
1,20,000 3,80,000 50,000 40,000 30,000 |
|
|
6,20,000 |
6,20,000 |
|
Additional information:
a. Provide depreciation on building by Rs 15,000.
b. Prepaid rent is Rs 4,000.
c. Provision for tax is to be made Rs 10,000.
d. Accrued commission Rs 5,000.
Required: Journal entries for adjustments and work sheet
[Answer: Adjustment = 34,000; Adjusted TB = 6,35,000;
***********
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