Bad debts A/c To Sundry debtors A/c Dr. Shown on the debit side of profit and loss A/c when there is no provision for bad and doubtful debts. (If there is a provision for bad and doubtful debts account existing, bad debts is to be transferred to provision for bad debts A/c). Shown on the assets side by way of deduction from the amount of sundry debtors.
Provision for bad and doubtful debts Profit & Loss A/c To Provision for bad and doubtful debts A/c Dr. Shown on the debit side of profit and loss A/c Shown on the assets side as a deduction from sundry debtors. Provision for discount on debtors Profit & Loss A/c To Provision for discount on debtors A/c Dr. Shown on the debit side of profit and loss A/c.
Shown on the assets side as a deduction from sundry debtors. Income tax paid Drawings A/c To Bank A/c Dr. Shown on the liabilities side as a deduction from capital. Shown on the assets side as a deduction from bank balance.
Manager’s commission Manager’s commission A/c To Outstanding manager’s commission A/c Dr. Shown on the debit side of profit and loss A/c. Shown on the liabilities side as a current liability. Accountancy .
Final accounts with adjustments Illustration Prepare trading account from the following ledger balances presented by P. Sen as on st March, . Stock ( - - ) Purchases Wages Carriage inwards Freight inwards , , , , , , Sales Returns inward Returns outward Gas and Fuel , , , , , Additional information: (a) Stock on st March, ` , (b) Outstanding wages amounted to ` , (c) Gas and fuel was paid in advance for ` , Solution Dr. Trading account for the year ended st March, Cr.
To Opening Stock To Purchases Less: Returns outward To Wages Add: Outstanding To Carriage inwards To Freight inwards To Gas and fuel Less: Prepaid To Gross profit c/d , , , , , , , , , , , , , , , By