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1. The profit for 2001 was Rs. 45,000 and for 2002 was Rs. 85,000 2. Additional information is provided about expenses, depreciation, drawings and other items for 2002 3. Using the gross profit percentage of 25% and the given profit of Rs. 85,000, calculate the gross profit, sales, cost of sales, and direct manufacturing expenses for 2002.

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396 views9 pages

Incomplete Records

1. The profit for 2001 was Rs. 45,000 and for 2002 was Rs. 85,000 2. Additional information is provided about expenses, depreciation, drawings and other items for 2002 3. Using the gross profit percentage of 25% and the given profit of Rs. 85,000, calculate the gross profit, sales, cost of sales, and direct manufacturing expenses for 2002.

Uploaded by

Okasha Ali
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

Question 1:

Answer:
Question 2:
Question 3:

As per the balance sheet of a sole proprietor, Akbar & Sons the profit for the year ended December 31,
2001 was Rs. 45,000, whereas the profit figure in the balance sheet as on December 31, 2002 is Rs.
85,000.

The following facts are ascertained relating to the year ended December 31, 2002:
a) 10% depreciation on diminishing value method has been charged to plant and machinery. The
net book value of plant and machinery as on December 31, 2002 was Rs. 100,000 whereas its
cost was 150,000.
b) Provision for doubtful debts is 2% of debtors as on December 31, 2002. Gross debtors are Rs.
250,000 and a provision of Rs.3,000 was already available from the last year. Rs.5,000 loss on
sale of fixed assets has been debited.
c) Advertising of Rs.8,000 has been made during the year.
d) Indirect manufacturing expenses has been incurred amount to Rs.50,000.
e) Insurance of Rs. 15,000 from July 2002 to June 2003 is paid.
f) Drawings of Rs.20,000 have been made by Mr. Saad.
g) Gross profit percentage is 25 percent.

Required:

Find out:

i. gross profit;
ii. sales;
iii. cost of sales; and
iv. direct manufacturing expenses for the year ended December 31, 2002.

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