Single Entry System | Exam Based Problems and Answers
Arjun EP
Statement of Affairs with Adjustment
Under this topic, we should find out opening capital, closing capital and profit or loss for the period.
Step 1: Find out opening capital or prepares opening statement of affairs (never adjust here, additional information),
Step 2: Prepare closing statement of affairs to find out closing capital (adjustments can be adjusted here),
Step 3: Prepare statement of P&L to find out profit or loss for the year (adjustment can be adjusted here).
Note: In this eBook, entire related additional information is adjusted with closing statement of affairs.
Exam based problems and answers of SINGLE ENTRY SYSTEM or ACCOUNTS FROM INCOMPLETE RECORDS are the BEST collection for sure shot success in the examination.
These questions are based on board exam.
These questions are set in easy to difficult series.
(A) Opening Statement of Affairs | Opening Capital | Beginning Capital
The opening statement of affairs is prepared to find-out opening capital.
Statement of affairs is similar to balance sheet.
All the assets are recorded on right hand side.
All the liabilities are recorded on left hand side.
The difference between assets and liabilities is opening capital.
(B) Closing Statement of Affairs | Closing Capital | Ending Capital
The closing statement of affairs is prepared to find-out closing capital.
Statement of affairs is similar to balance sheet.
All the assets are recorded on right hand side.
All the liabilities are recorded on left hand side.
If there is any adjustment, it should be adjusted with closing statement of affairs.
The difference between assets and liabilities is closing capital.
(C) Statement of Profit and Loss | Net Profit or Net Loss
After preparation of opening statement of affairs and closing statement of affairs, statement of profit and loss is prepared.
Before preparing statement of profit and loss, following points should be found-out:
Determination of drawing made by the owner during the year,
Additional or further capital invested by the owner,
Interest on capital (if any)
Exam Based Problems and Answers of Single Entry System
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country
PROBLEM: 1
AK Trader started business with capital of $90,000. It keeps its accounting under single entry system. At the year end his business position is as under:
|
Cash in hand |
$1,900 |
|
Closing stock |
$1,20,000 |
|
Bank balance |
22,600 |
|
Creditors |
45,000 |
|
Debtors |
69,500 |
|
Loan from bank |
20,000 |
|
Fixture |
5,000 |
|
|
|
Other information:
Interest @ 8% p.a. has not been paid on bank loan.
He has drawn $2,500 per month for his personal use.
Required: (a) Closing statement of affairs; (b) Statement of profit and loss
[Answer: Closing capital = $152,400 or $1,54,000;
Profit for the year = $92,400;
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country
PROBLEM: 2
ABC Traders, who keeps his accounts on single entry system, has provided you the following assets and liabilities on 31st March 2020:
|
Cash and bank balance |
$30,000 |
|
Land and building |
$1,50,000 |
|
Creditors |
45,000 |
|
Bills payable |
20,000 |
|
Furniture |
30,000 |
|
Debtors |
20,000 |
|
Machinery |
80,000 |
|
Bills receivable |
5,000 |
Other information:
The trader has started business on 1st April 2019 with capital $1,25,000.
He has drawn $20,000 during this period.
Depreciation charges at 10% p.a. on machinery and furniture.
Provide 10% for doubtful debts.
Required: (a) Closing statement of affairs to find out closing capital; (b) Statement of profit and loss
[Answer: Closing capital = $237,000 or $2,50,000;
Profit for the year = $1,32,000]
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country
PROBLEM: 3
Rajendra started business with cash $81,000 and inventories $50,000 on 1st January 2020. He keeps his accounting under single entry system. His assets and liabilities on 31st December 2020 are as follows:
|
Bills payable |
$20,000 |
|
Furniture |
$30,000 |
|
Creditors |
60,000 |
|
Debtors |
50,000 |
|
Bank loan |
24,000 |
|
Inventories |
65,000 |
|
Machinery |
1,00,000 |
|
Closing stock |
45,000 |
Other information:
He has drawn $40,000 during the year and introduced further capital $20,000.
Depreciate machinery and furniture by 5% and 10% respectively.
Required: (a) Closing statement of affairs; (b) Statement of profit and loss
[Answer: Closing capital = $178,000 or $186,000
Profit for the year = $67,000; *Opening capital = $131,000]
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country
PROBLEM: 4
Mr Bob started a business with cash $50,000 and machinery $20,000 on 1st January 2020. He follows single entry system. His position on 31st December 2020 is as follows:
|
Debtors |
$20,000 |
|
Furniture |
$10,000 |
|
Creditors |
10,000 |
|
Stock |
40,000 |
|
Cash |
15,000 |
|
Expenses due |
1,000 |
Other information:
His drawings during the year were $12,000 and introduced additional capital $10,000.
Bad debts written off $1,000 and provide depreciation on machinery @ 10%.
Required: (a) Closing statement of affairs; (b) Statement of profit and loss
[Answer: Closing capital = $91,000 or $94,000;
Profit for the year = $23,000;
*Opening capital (50,000 + 20,000) = $70,000]
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Journal Entries in Nepali |
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Journal Entries |
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Journal Entry and Ledger |
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Ledger |
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Subsidiary Book |
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Cashbook |
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Trial Balance and Adjusted Trial Balance |
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Bank Reconciliation Statement (BRS) |
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Depreciation |
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Accounting Process |
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Accounting for Long Lived Assets |
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Analysis of Financial Statement |
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Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country
PROBLEM: 5
AK Traders, who keeps his books of account on single entry system, provided you following assets and liabilities on 31st March 2020:
|
Cash and bank balance |
$20,000 |
|
Machinery |
$20,000 |
|
Sundry creditors |
15,000 |
|
Closing stock |
30,000 |
|
Sundry debtors |
12,000 |
|
Bills payable |
20,000 |
|
Prepaid rent |
5,000 |
|
Bills receivable |
18,000 |
Other information:
The trader started business on 1st April 2019 with capital $50,000.
His drawings during the year were $7,400.
Depreciation is charged 10% p.a. on machinery.
Also provide 5% for doubtful debts on sundry debtors.
Required: (a) Closing statement of affairs to determine closing capital; (b) Statement of profit and loss
[Answer: Closing capital = $67,400 or $70,000;
Profit for the year = $24,800;
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country
PROBLEM: 6
Books of account of Ms Komal, maintained under single entry system provide the following information:
|
Particulars . |
1st April 2020 |
31st March 2021 |
||
|
Furniture |
$2,000 |
|
$2,000 |
|
|
Stock |
28,000 |
|
30,500 |
|
|
Sundry debtors |
21,000 |
|
34,000 |
|
|
Cash |
1,500 |
|
5,000 |
|
|
Sundry creditors |
17,500 |
|
19,000 |
|
|
Loan taken |
– |
|
5,000 |
|
|
Investment |
– |
|
10,000 |
|
Other information:
Komal introduced further capital of $5,000 and his drawings during the year were $9,000.
Provide a reserve for bad and doubtful debt at 10%
Depreciate furniture by 10%
Required: (a) Closing statement of affairs to find out closing capital; (b) Statement of profit and loss
[Answer: Closing capital = $53,900 or $57,500;
Profit for the year = $22,900; *Opening capital = $35,000
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country
PROBLEM: 7
Jeevan maintains his books of accounts on single entry system. His books provide following information:
|
Particulars |
1st January |
31st December |
||
|
Cash |
$3,000 |
|
$10,000 |
|
|
Furniture |
4,000 |
|
4,000 |
|
|
Stock |
56,000 |
|
61,000 |
|
|
Debtors |
̶ |
|
68,000 |
|
|
Creditors |
̶ |
|
38,000 |
|
Other information:
He introduced further capital $8,000 and his drawings during the year were $10,000.
Depreciate furniture by 10% p.a.
Reserve for bad and doubtful debts at 5% on debtors.
Required: (a) Closing statement of affairs; (b) Statement of profit and loss
[Answer: Closing capital = $1,01,200 or $1,05,000;
Profit for the year = $40,200; *opening capital = $63,000]
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country
PROBLEM: 8
Mr Agrawal maintains his books of account on single entry system. He submitted the following details:
|
Particulars |
1st Jan 2020 |
31st Dec 2020 |
||
|
Cash |
$5,000 |
|
$15,000 |
|
|
Furniture |
10,000 |
|
10,000 |
|
|
Stock |
60,000 |
|
65,000 |
|
|
Debtors |
– |
|
50,000 |
|
|
Creditors |
– |
|
25,000 |
|
Other information:
Mr Agrawal introduced further capital of $12,000 on 1 July 2020.
Drawings for the year were $10,000.
Depreciate furniture by 10% p.a.
Reserve for bad and doubtful debts at 5% on debtors.
Interest on capital 10% p.a.
Required: (a) statement of affairs to determine closing capital; (b) Statement of profit and loss
[Answer: Closing capital = $111,500 or $ 1,15,000;
Profit for the year = $26,400;
*Opening capital = $75,000; Interest (7,500 + 600) = $8,100]
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country
PROBLEM: 9
Mr Thapa who keeps his books of accounts on single entry system provided you the following assets and liabilities at the end of December, 2020:
|
Machinery |
$5,00,000 |
|
Investment in government bond |
1,00,000 |
|
Land and building |
6,00,000 |
|
Account receivable |
3,00,000 |
|
Furniture |
40,000 |
|
Advance from customers |
2,50,000 |
|
Account payable |
2,00,000 |
|
Cash and bank |
50,000 |
Other information:
Business started on 1st Baishakh, with a capital of $8,00,000.
Drawing per month was $12,000.
Depreciate machinery by 10% and furniture by 20%.
Appreciation on land by $1,00,000.
Write off bad debts of $20,000 on account receivable
Required: (a) Statement of affairs to find out closing capital; (b) Statement of profit and loss
[Answer: Closing capital = $11,62,000 or $11,40,000;
Profit for the year = $506,000]
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country
PROBLEM: 10
Mr Pathak who keeps his accounts on single entry system has following data on 31st December:
|
Cash balance |
$20,000 |
|
Book debts |
1,50,000 |
|
Bank overdraft |
2,00,000 |
|
Investment |
1,20,000 |
|
Furniture |
30,000 |
|
Stock |
1,45,000 |
|
15% Loan (1 April) |
2,00,000 |
|
|
|
Other information:
He started business on 1st January with capital $1,50,000 cash and $2,00,000 equipment.
He has drawn $1,80,000 during this period.
Charge depreciation @ 10% p.a. on fixed assets.
Additional capital invested $55,000 on 1st October.
Interest charged on capital @ 5%.
Required: (a) Closing statement of affairs to find out closing capital; (b) Statement of profit and loss
[Answer: Closing capital = $219,500 or $2,65,000;
Net loss = $23,688;
*Interest on loan = $22,500; Capital = 18,188
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country
PROBLEM: 11
Ms Ganga started business with cash $80,000 on 1st January 2020. She keeps her account on single entry system. At the end of year, her position was as follows:
|
Furniture |
10,000 |
|
Creditors |
160,250 |
|
Debtors |
1,30,000 |
|
Outstanding rent |
30,000 |
|
10% Investment (1 July 2020) |
50,000 |
|
Stock |
1,75,000 |
|
Prepaid insurance |
5,000 |
|
Cash balance |
13,000 |
Other information:
He further invested $75,000 during the year.
Bad debts $5,000 and provision for bad debts 5%.
Depreciated is to be provided at 20% on furniture.
She paid $22,000 for school fees of her child.
Required: (a) Closing statement of affairs; (b) Statement of profit and loss account
[Answer: Closing capital = $182,000 or $1,92,750;
Profit for the year = $49,000;
Here, Amount = Rs = $ = £ = € = ₹ = Af = ৳ = Nu = Rf = රු = Br = P = Birr = Currency of your country
PROBLEM: 12
Mr Pawan maintains his accounting books under single entry system. He has following information:
|
Particulars . |
1 Jan 2020 |
31st Dec 2020 |
|
Furniture |
5,000 |
10,000 |
|
Stock |
25,000 |
40,000 |
|
Sundry debtors |
1,50,000 |
1,00,000 |
|
Cash |
7,500 |
15,000 |
|
Sundry creditors |
56,000 |
79,000 |
|
15% Loan taken |
– |
50,000 |
|
Investment |
– |
80,000 |
Other information:
Depreciate furniture by 10%; additional furniture was purchased on 1st April 2020.
Loan was taken on 1st October 2020.
He withdrew goods worth $20,000 and cash of $40,000 for domestic use.
Discount maintained @ 5% on creditors.
Required: (a) Statement of affairs to find out opening and closing capital; (b) Statement of profit and loss
[Answer: Opening capital = $131,500;
Closing capital = $117,200 or $116,000;
Profit for the year = $45,700; *Depreciation on furniture = $875
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