Prepare a trading and profit and loss account for the year ending December 31, 2005. From the balances extracted of M/s Ramesh sons. Also prepare a balance sheet at the end of the year.
Adjustments
1. Commission received in advance Rs. 500
2. Rent receivable Rs. 1,000.
3. Salary outstanding Rs. 500 and insurance prepaid? 400.
4. Further bad debts Rs. 500 and provision for bad debts @ 5% on debtors and discount on debtors @ 2%
5. Closing stock Rs. 16,000. 6. Depreciation on building @ 6% p.a.