MANAC-I INDIVIDUAL COMPREHENSIVE PROJECT

Final Report Submitted as part of course work for MANAC -1

To
Prof. Ram Kumar Kakani
By
Subhajit De
B16173, BM/C
Introduction

M/s Bhabani Industrial Paints was started by me on 31/03/2016 as a sole proprietorship

manufacturing firm with an investment capital of 53.63 crores INR. It manufactures Industrial Paints.
It sells finished industrial paints to the industry customers directly on order and doesnt sell to
individual dealers. The raw materials (pigments, additives, resins, chemicals, solvents, extenders, oils
etc.) are sourced directly from a nearby chemical factory. The manufacturing process includes mixing
of raw materials, milling, blending, filtering, final packing and transportation. Machinery and
equipment were bought for setting up of an installation capacity of 20000 l/day and the factory-floor
was set up on a 20000 sq. ft. land taken on lease (Details of the transactions leading to final production
commencement and sale is described later).

Manufacturing 1 unit of finished paint item requires 1 unit of raw material bundle.
1 unit of raw material bundle consists of the following
Pigment: 0.5 kg
resins: 0.3kg
additive agents: 0.2kg
Oil: 50litres
Finished goods items are manufactured upon order. So finished goods inventory shall be zero at
the end of each order and hence at the end of each month.
 Transactions for the Month of March
Date Particulars Amt.('000)
Subhajit introduced capital into his business M/s Bhabani Industrial Paints 536300
01-03-2016
Payment towards municipality taxes 10726
Paid monthly land rent in cash 500
02-03-2016
Expenses towards foundation stone ceremony in cash 400
Availed a long term loan from SBI @ 10 p.a interest(Interest payable monthly and principal repayable over 5
03-03-2016 years in monthly instalments) 1072600
Bought plant machinery( 2 blenders,2 mixers, 2 millers,2 bottler,2 filter),through cheque 391882
Payment to Sahu Contractors for installation of machinery, in cash 20000
04-03-2016
Payment to M/s Devi safety systems for purchase and installation of safety systems, through cheque 50000
Bought a building for main office near the factory , payment in cash 10000
05-03-2016
Bought furniture for office, in cash 1000
06-03-2016 OFF-DAY
07-03-2016 OFF-DAY
Bought vehicles( 10 large trucks,10 tata ace, 2 tata sumo, 1 sedan, 10 cycles), through cheque 90000
08-03-2016
Payment to the contractor in charge of setup of in-plant shift office buildings,in cash 2000
Bought 2 generators ,in cash 3000
09-03-2016
Bought Air conditioners, 25 numbers, in cash 1000
Payment to Putu Electric contractor for setting up of generators and wiring connections,in cash 500
10-03-2016
Payment to technology consultant , cash 500
Bought computers for main office and shift offices, cash 1000
11-03-2016
Bought ABC software package for inventory management and business optimization 1000
Bought uniforms,hand gloves,nose masks,eye gears for labourers(provided every month) 500
12-03-2016
Payment to business consultant 500
13-03-2016 OFF-DAY
14-03-2016 OFF-DAY
Purchased 100 units of raw material bundles from Zeeshan Chemicals, in cash 10000
Discount availed @3% 300
15-03-2016
Purchased 100 units of raw material bundles from Zeeshan Chemicals, in cash 1000
Discount availed @3% 30
Payment towards advertisement agency, in cash 200
16-03-2016
Payment towards diesel for shipping, in cash 50
Sold 600 units of paint items to Ashu Industries,in cash 7200
Discount @3%given to Ashu Industries for cash sales 216
17-03-2016
Sold 300 units of paint items to PRIYANSHU Industries,in cash 3600
Discount given @3% to PRIYANSHU Industries for cash sales 108
Purchased 1 blender and 1 bottler,through cheque 40000
18-03-2016
Purchased 5500 units of raw material bundles from Zeeshan Chemicals, on credit 55000
Payment towards diesel for shipping, in cash 100
19-03-2016
Payment towards monthly maintenance of the trucks 100
20-03-2016 OFF-DAY
21-03-2016 OFF-DAY
Sold 2700 units of paint items to IFFAT Industries,on credit 32400
22-03-2016
Donation to an NGO for blind, in cash 1000
Bought 20 Vacuum cleaners, in cash 400
23-03-2016 Paid interest @ 10% pa on long term loan borrowed from SBI and the monthly payment of the Principal
amount(5 years) 8938
23-03-2016 paid principal amount as monthly instalment 17877
Paid electricity bill, in cash 100
24-03-2016 Purchased 1400 units of raw material bundles from Zeeshan Chemicals, in cash 14000
Discount @ 3 % received from Zeeshan Chemicals for cash sales 420
Sold 2100 units of paint items to iffat Industries,in cash 25200
25-03-2016 Discount given @3% to Iffat Industries for cash sales 756
Paid wages to labourers and in-plant staff,cash 7200
Paid salary to main office personnel, cash 100
Purchased 7000 units of raw material bundles from Zeeshan Chemicals, on credit 70000
26-03-2016
Sold 6300 units of paint items to IFFAT Industries,on credit 75600
Payment towards GOVINDA Caterers for month end feast, in cash 200
 Investment in short term inter-corporate market, cheque 499718
26-03-2016
Investment in short term inter-corporate market,cash 434075
27-03-2016
28-03-2016
29-03-2016 plant maintenance
30-03-2016
31-03-2016

Journal Entries
Date Particulars dr. cr.
Cash a/c 536300
01-03-2016 Capital a/c 536300
(Being capital invested by Subhajit )
municipality tax a/c 10726
01-03-2016 Cash a/c 10726
(Being municipal taxes paid in cash)
Rent expenses a/c 500
02-03-2016 Cash a/c 500
(being rent paid in cash)
Miscellaneous expenses a/c 400
02-03-2016 Cash a/c 400
(being foundation ceremony expenses paid in cash)
Bank a/c 1072600
03-03-2016 loan a/c 1072600
(being loan taken from SBI repayable over 5 years @10% interest pm)
plant machinery a/c 391882
03-03-2016 Bank a/c 391882
(Being plant machinery purchased, payment through cheque)
plant machinery a/c 20000
04-03-2016 Cash a/c 20000
Being plant machinery installation charges paid in cash
plant machinery a/c 50000
04-03-2016 Bank a/c 50000
(being inplant safety systems installion charges paid through cheque)
Building a/c 10000
05-03-2016 Cash a/c 10000
(Being main office building purchased in cash)
furniture a/c 1000
05-03-2016 Cash a/c 1000
(being furniture purchased in cash)
vehicles a/c 90000
08-03-2016 Bank a/c 90000
(being vehicles purchased through cheque)
Building a/c 1000
08-03-2016 Cash a/c 1000
(being building(shift office) installation charges paid in cash)
In plant accessories a/c 3000
09-03-2016 Cash a/c 3000
(being generators purchased in cash)
building accessroies a/c 1000
09-03-2016 Cash a/c 1000
(being airconditionars purchased in cash)
In plant accessories a/c 500
10-03-2016 Cash a/c 500
(being generator installation charges paid in cash)
consultant charges a/c 1000
10-03-2016 Cash a/c 1000
(being tech. consultant charges paid in cash)
 computer a/c 1000
11-03-2016 Cash a/c 1000
(being computers purchased in cash)
software package a/c 1000
11-03-2016 Cash a/c 1000
(being software package purchased in cash)
labor uniform charges a/c 500
12-03-2016 Cash a/c 500
(being labor uniform and safety wear kits purchased in cash)
consultant charges a/c 500
12-03-2016 Cash a/c 500
(being business consultant charges paid in cash)
supplies and raw material purchase a/c 10000
purchase cash discount received a/c 300
15-03-2016
Cash a/c 9700
(being raw materials and supplies purchased in cash and cash discount received @3%))
supplies and raw material purchase a/c 1000
purchase cash discount received a/c 30
15-03-2016
Cash a/c 1000
(being containers purchased in cash and cash discount received @3%))
advertisement expenses a/c 200
16-03-2016 Cash a/c 200
(being advertisement expenses paid in cash)
fuel expenses a/c 50
16-03-2016 Cash a/c 50
(being fuel expenses paid in cash)
Cash a/c 6984
sales discount a/c 216
17-03-2016
sales a/c 7200
(being items sold in cash and cash discount allowed @3%)
Cash a/c 3492
sales discount a/c 108
17-03-2016
sales a/c 3600
(being items sold in cash and cash discount allowed @3%)
plant machinery a/c 40000
18-03-2016 Bank a/c 40000
(Being plant machinery purchased, payment through cheque)
supplies and raw material purchase a/c 55000
18-03-2016 creditors a/c 55000
(beng raw materials and supplies purchased on credit, credit period 14 days)
fuel expenses a/c 100
19-03-2016 Cash a/c 100
(being fuel expenses paid in cash)
maintenance charges a/c 100
19-03-2016 Cash a/c 100
(being maintenance charge paid in cash)
debtors a/c 32400
22-03-2016 sales a/c 32400
(being items sold on credit)
Miscellaneous expenses a/c 1000
22-03-2016 Cash a/c 1000
(being donation made to NGO in cash)
building accessroies a/c 400
23-03-2016 Cash a/c 400
(being vaccuum cleaners purchased in cash)
interest expense a/c 8938
23-03-2016 Cash a/c 8938
(being interest paid to bank in cash for loan taken)
loan a/c 17877
23-03-2016
Cash a/c 17877
23-03-2016 (being 1st monthly installment of principal paid to bank in cash)
supplies and raw material purchase a/c 14000
purchase cash discount received a/c 420
24-03-2016
Cash a/c 13580
(being raw materials and supplies purchased in cash and cash discount received @3%))
elctricity expenses 100
24-03-2016 Cash a/c 100
(being electricity charges paid in cash)
Cash a/c 24444
sales discount a/c 756
sales a/c 25200
25-03-2016 (being items sold in cash and cash discount allowed @3%)
wages a/c 7200
25-03-2016 Cash a/c 7200
(being wages paid to labourers in cash)
salary a/c 100
26-03-2016 Cash a/c 100
(being salary paid to office personnel in cash)
supplies and raw material purchase a/c 70000
26-03-2016 creditors a/c 70000
(beng raw materials and supplies purchased on credit, credit period 14 days)
debtors a/c 75600
26-03-2016 sales a/c 75600
(being items sold on credit)
Miscellaneous expenses a/c 200
26-03-2016 Cash a/c 200
(being catering expenses for feast paid in cash)
short term investment a/c 434075
27-03-2016 Cash a/c 434075
(being investment being made in intercorporate market, through cash)
short term investment a/c 499718
27-03-2016 Bank a/c 499718
(being investment being made in intercorporate market, through cheque)
Depreciation adjustment entries
depreciation expenses a/c 4354.0
plant machinery a/c 3602.9
building a/c 76.1
building accessories a/c 6.8
31-03-2016 computer a/c 5.4
software package a/c 5.4
vehicles a/c 629.0
Inplant accessories a/c 21.5
furniture a/c 7.0
 LEDGER ACCOUNTS
CASH a/c
dr. cr.
DATE a/c DATE a/c
01-03-2016 capital a/c 536300 01-03-2016 municipality tax a/c 10726
17-03-2016 sales a/c 6984 02-03-2016 Rent expenses a/c 500
17-03-2016 sales a/c 3492 02-03-2016 Miscellaneous expenses a/c 400
25-03-2016 sales a/c 24444
04-03-2016 plant machinery a/c 20000
05-03-2016 building a/c 10000
05-03-2016 furniture a/c 1000
08-03-2016 building a/c 1000
09-03-2016 In plant accessories a/c 3000
09-03-2016 building accessroies a/c 1000
10-03-2016 In plant accessories a/c 500
10-03-2016 consultant charges a/c 1000
11-03-2016 computer a/c 1000
11-03-2016 software package a/c 1000
12-03-2016 labor uniform charges a/c 500
12-03-2016 consultant charges a/c 500
15-03-2016 supplies and raw material purchase a/c 9700
15-03-2016 supplies and raw material purchase a/c 970
16-03-2016 advertisement expenses a/c 200
16-03-2016 fuel expenses a/c 50
19-03-2016 fuel expenses a/c 100
19-03-2016 maintenance charges a/c 100
22-03-2016 Miscellaneous expenses a/c 1000
23-03-2016 building accessroies a/c 400
23-03-2016 interest expense a/c 8938
23-03-2016 loan a/c 17877
24-03-2016 supplies and raw material purchase a/c 13580
24-03-2016 elctricity expenses 100
25-03-2016 wages a/c 7200
26-03-2016 salary a/c 100
26-03-2016 Miscellaneous expenses a/c 200
27-03-2016 short term investment a/c 434075
balance 24504.4
Bank a/c
01-03-2016 loan a/c 1072600 plant machinery a/c 391882
plant machinery a/c 50000
vehicles a/c 90000
plant machinery a/c 40000
short term investment a/c 499718
1071600
balance 1000

DEBTORS
a/c
22-03-2016 sales a/c 32400
26-03-2016 sales a/c 75600
balance 108000
Plant machinery a/c
03-03-2016 bank a/c 391882 31-03-2016 depreciation a/c 3602.9
04-03-2016 bank a/c 50000
18-03-2016 bank a/c 40000
04-03-2016 cash a/c 20000
balance 498279.1

inplant accessories a/c

09-03-2016 cash a/c 3000 31-03-2016 depreciation a/c 21.5
10-03-2016 cash a/c 500
balance 3478.5

Building a/c
05-03-2016 cash a/c 10000 31-03-2016 depreciation a/c 76.1
08-03-2016 cash a/c 1000
balance 10923.9

Building accessories a/c

09-03-2016 cash a/c 1000 31-03-2016 depreciation a/c 6.8
23-03-2016 cash a/c 400
balance 1393.2

furniture
a/c
05-03-2016 cash a/c 1000 31-03-2016 depreciation a/c 7.0
balance 993.0

computer a/c
11-03-2016 cash a/c 1000 31-03-2016 depreciation a/c 5.4
balance 994.6

software package a/c

11-03-2016 cash a/c 1000 31-03-2016 depreciation a/c 5.4
balance 994.6

supplies
and raw
material
purchase
a/c
15-03-2016 cash a/c 9700
15-03-2016 cash a/c 970
24-03-2016 cash a/c 13580
18-03-2016 creditors a/c 55000
26-03-2016 creditors a/c 70000
15-03-2016 discounts received a/c 300
15-03-2016 discounts received a/c 30
24-03-2016 discounts received a/c 420
balance 150000
creditors a/c
18-03-2016 supplies and raw material purchase a/c 55000
26-03-2016 supplies and raw material purchase a/c 70000
balance 125000
sales a/c
17-03-2016 cash a/c 6984
17-03-2016 cash a/c 3492
25-03-2016 cash a/c 24444
22-03-2016 debtors a/c 32400
26-03-2016 debtors a/c 75600
17-03-2016 discounts allowed a/c 216
17-03-2016 discounts allowed a/c 108
25-03-2016 discounts allowed a/c 756
balance= 144000

debtors a/c
22-03-2016 sales a/c 32400
26-03-2016 sales a/c 75600
balance 108000

municipality tax expenses a/c

01-03-2016 cash a/c 10726

balance 10726

rent expenses a/c

balance 500

miscellaneous expenses a/c

02-03-2016 cash a/c 400
22-03-2016 cash a/c 1000
26-03-2016 cash a/c 200
balance 1600

capital a/c
01-03-2016 cash a/c 536300

balance 536300

loan a/c
23-03-2016 cash a/c 17877 03-03-2016 bank a/c 1072600

balance 1054723

vehicle a/c
08-03-2016 bank a/c 90000 31-03-2016 depreciation a/c 629.0

balance 89371.0 629.03226

consultant charges a/c

10-03-2016 cash a/c 1000
12-03-2016 cash a/c 500
balance 1500

labour uniform chares a/c

12-03-2016 cash a/c 500
balance 500
advertisement expenses a.c
DATE a/c DATE PARTICULARS
16-03-2016 cash a/c 200
balance 200

fuel expenses a/c

DATE a/c DATE PARTICULARS
16-03-2016 cash a/c 50
19-03-2016 cash a/c 100
balance 150

wages a/c
DATE a/c DATE PARTICULARS
25-03-2016 cash a/c 7200

balance 7200

salary a/c
DATE a/c DATE PARTICULARS
26-03-2016 cash a/c 100

balance 100

electricity expenses a/c

DATE a/c DATE PARTICULARS
24-03-2016 cash a/c 100

balance 100

interest expenses a/c

DATE a/c DATE PARTICULARS
23-03-2016 cash a/c 8938

balance 8938.333333

discount allowed a/c

DATE a/c DATE PARTICULARS
17-03-2016 sales a/c 216
17-03-2016 sales a/c 108
25-03-2016 sales a/c 756
balance 1080

discount received a/c

DATE a/c DATE PARTICULARS
15-03-2016 supplies and raw material purchase a/c 300
15-03-2016 supplies and raw material purchase a/c 30
24-03-2016 supplies and raw material purchase a/c 420
balance 750

short term
investment
a/c
DATE a/c DATE PARTICULARS
27-03-2016 cash a/c 434075
27-03-2016 bank a/c 499718
balance 933793
depreciation a/c
DATE a/c DATE PARTICULARS
31-03-2016 plant machinery a/c 3602.9
31-03-2016 building a/c 76.1
31-03-2016 building accessroies a/c 6.8
31-03-2016 computer a/c 5.4
31-03-2016 software package a/c 5.4
31-03-2016 vehicles a/c 629.0
31-03-2016 Inplant accessories a/c 21.5
31-03-2016 furniture a/c 7.0
balance 4354.0

TRIAL BALANCE

(All items are in Rs000)

ITEMS dr cr
CASH 24504.4
BANK 1000
DEBTORS 108000
Raw materials and supplies 150000
short term investments 933793
Plant machinery 501882.0
adj depreciation 3602.9
Inplant accessories 3500.0
adj depreciation 21.5
Building 11000.0
adj depreciation 76.1
building accessories 1400.0
adj depreciation 6.8
Vehicles 90000.0
adj depreciation 629.0
Furniture 1000.0
adj depreciation 7.0
Computer 1000.0
adj depreciation 5.4
software package 1000.0
adj depreciation 5.4
Creditors 125000
Loan 1054723
Capital 536300
Sale 144000
municipality tax expenses 10726
rent expenses 500
miscellaneous expenses 1600
consultant charges 1500
labor uniform charges 500
advertisement expenses 200
fuel expenses 150
maintenance charges 100
elctricity expenses 100
wages 7200
Salary 100
interest expenses 8938.333333
discounts received 750
discounts allowed 1080
depreciation expenses 4354.0
TOTAL 1865127.34 1865127.3
 P&L statement of March

(All items are in Rs000)

DR CR
PARTICULARS amt PARTICULARS amt
To opening stock 0 By sales 144000
To Raw materials and supplies purchased 150000 By closing stock 30000
To wages 7200
To maintenance charges 100
To labour uniform charges 500
To Gross profit 16200
municipality tax expenses 10726
rent expenses 500 By gross profit 16200
miscellaneous expenses 1600 By discount received 750
consultant charges 1500
advertisement expenses 200
fuel expenses 150
electricity expenses 100
salary 100
interest expenses 8938.3333
discounts allowed 1080
depreciation expenses 4354.0043
Net Profit -12298

BALANCE SHEET as on 31/03/2016

(All items are in Rs000)

CURRENT ASSETS Amt CURRENT LIABILITIES amt

CASH 24504.4 creditors 125000
BANK 1000
DEBTORS 108000 NONCURRENT LIABILITIES
SHORT TERM INVESTMENTS 933793 loan 1054723
RAW MATERIALS CLOSING
STOCK 30000 Total liabilities 1179723
Total current Assets 1097297
OWNERS EQUITY
NON CURRENT ASSETS CAPITAL 536300
Plant machinery 498279.1 RETAINED EARNINGS FROM P&L -12298
Inplant accessories 3478.5 Total owners equity 524001.66
Building 10923.9
building accessories 1393.2
vehicles 89371.0
FURNITURE 993.0
COMPUTER 994.6
SOFTWARE PACKAGE 994.6
Total non-current Assets 606428
Total Assets 1703725 Total liabilities and owners equity 1703725
 INVENTORY VALUATION USED

Manufacturing 1 unit of finished paint item requires 1 unit of raw material bundle.
1 unit of raw material bundle consists of the following
Pigment: 0.5 kg
resins: 0.3kg
additive agents: 0.2kg
Oil: 50litres

The raw materials are bought from the vendors in the form of bundles only

No of Raw material Price of raw

bundles bought material
bundle(Rs000)
15-03-2016 1000 10
15-03-2016 100 10
24-03-2016 1400 10
18-03-2016 5500 10
26-03-2016 7000 10
30-03-2016 9.5
total 15000

No of finished paint Price of the sale

item sold item(Rs000)
17-03-2016 600 12
17-03-2016 300 12
25-03-2016 2700 12
22-03-2016 2100 12
26-03-2016 6300 12
Total 12000

Raw material bundles Inventory left at the end of the month=3000

Finished goods inventory=0 as the items are manufactured from the raw materials only on order.
Inventory valuation @ 10/bundle as on 31/03/2016 is 30000(using FIFO method)
Closing stock of raw material(Rs000)= 30000

COMPLIANCE STATEMENT

1. Date of birth 31/03/1989, date of commencement of business 01/03/2016.

2. Contributed capital= 31x173 Rs lakhs (Roll No B16173, Day of birth: 31)=536300( Rs000)
Long term loans = 2xcapital=2x536300=1072600
3. Grant from gov. not availed
4. Total Fixed assets purchased=611382 (38% of long term funds i.e long term loans + capital)
5. Depreciation has been calculated for the fixed assets as per Straight line method from the date
of purchase till the end of the month. Life of all the Fixed asset items is taken as 10 years.
6. Total Cash sales=36000, Total credit sales=108000, hence complied with
7. Total Cash Purchases=25000, Total credit Purchases=125000, hence complied with
8. Credit period of 14 days (both for sales and purchase) has been followed
9. NA
10. Total cash balance at the end of the month=25504(including the bank)
Total cash expenses throughout the month:99245
So it is within the limit of [(3 to 7) /20] of the total cash expenses. Excess cash has been invested
in short term investments to keep the cash balance in allowable limit.
11. NA
12. Has been followed to the next month as the first credit sale has been made on 22/03/2016
13. All the payments have been made on time by the company and hence discount of 3% has been
availed. A discount of 3% has been allowed when payments have been received on time from
parties.
14. NA
15. Not applicable for this month.
16. Interest paid @ 10% =8938, 1st instalment of principal paid=17876
17. NA
18. Sales price=12/unit, raw material price=10/unit (15/03/2016), 9.5/unit on
(30/03/2016)[reduction @5% every 15 days)
19. Complied
20. Sales and purchases of items were started once the machinery had been setup.
21. Municipal rates=10726(2% of owners equity at the beginning of the month)
22. Wage cost=7200 ( 5% of total sales(144000))
23. NA
24. Complied
 Transactions for the Month of April
DATE PARTICULARS Amt ( Rs000)
01-04-2016 availed grant from government 53630
Paid Zeeshan chemical for payment of the raw material purchased on credit on 18/03/2016, in cash 55000
Disount received @3% from zeeshan 1650
Sold 687 fifty litre paint bottles to zakir industries in cash 9080.67
02-04-2016
discount given @3% 272.4201
Purchased 10000 units of raw material bundles from Zeeshan Chemicals, on credit 95000
Sold 2536 fifty litre paint bottles to iffat Industries on credit 27241.115
03-04-2016
Purchased 526 units of raw material bundles from Zeeshan Chemicals, in cash 5000
Discount 150
Payment towards municipality taxes 10480.03325
04-04-2016 Sold 271 units of paint items to iffat Industries,in cash 3580
discount given @3% 107.4
Sold 813 units of paint items to IFFAT Industries,on credit 10740
05-04-2016
80% of the payment received from iffat industries for the credit sale made on 22/03/2016(credit period=14 days) 25920
Paid monthly land rent in cash 500
06-04-2016 OFF-DAY
07-04-2016 OFF-DAY
08-04-2016 Payment towards diesel for shipping, in cash 100
Bought uniforms,hand gloves,nose masks,eye gears for labourers(provided every month) 500
Payment to business consultant 500
09-04-2016 80% of the payment received from iffat industries for the credit sale made on 26/03/2016(credit period=14 days) 60480
Paid Zeeshan chemical for payment of the raw material purchased on credit on 26/03/2016, in cash 70000
discount availed@ 3% 2100
Purchased 631 units of raw material bundles from Zeeshan Chemicals, on credit 6000
discount availed@ 3% 180
Payment towards advertisement agency, in cash 200
10-04-2016 Payment towards safety awareness programme in paint industry,in cash 100
Payment towards monthly maintenance of the trucks 200
11-04-2016
Sold 1203 units of paint items to iffat Industries,in cash 15889.83
discount given @3% 476.6949
remaining 20% of the payment received from iffat industries for the credit sale made on 22/03/2016(credit period=14
days) 6480
12-04-2016
penalty amount received @1%pm 15.12
Sold 2685 units of paint items to qatar Industries,on credit 35442
Sold 1822units of paint items to IFFAT Industries,on credit 24053.304
13-04-2016 OFF-DAY
14-04-2016 OFF-DAY
Payment towards diesel for shipping, in cash 100
15-04-2016
Purchased 443 units of raw material bundles from Zeeshan Chemicals, in cash 4000
discount availed 120
Purchased 443 units of raw material bundles from Zeeshan Chemicals, in cash 4000
discount availed 120
16-04-2016 remaining 20% of the payment received from iffat industries for the credit sale made on 26/03/2016(credit period=14
days) 15120
penalty amount received @1%pm 35.28
Paid Zeeshan chemical for payment of the raw material purchased on credit on 02/04/2016, in cash 95000
discount availed @3% 2850
Payment towards diesel for shipping, in cash 100
17-04-2016 80% of the payment received from iffat industries for the credit sale made on 03/04/2016 (credit period=14 days) 21792.892
R&D expenses 14.52
18-04-2016 Off
80% of the payment received from iffat industries for the credit sale made on 05/04/2016 (credit period=14 days) 8592
19-04-2016
sold 1 bottle of paint to an ambassador, in cash 14.52
discount given @3% 0.4356
20-04-2016 Off
Sold 298 units of paint items to iffat Industries,in cash 3938
21-04-2016 discount paid 118.14
Sold Inter-corporate securities worth Rs85066000 85066
Sold 401 units of paint items to iffat Industries,in cash 5293.925
discount paid 158.81775
22-04-2016 Payment to technology consultant , cash 500
Purchased 554units of raw material bundles from Zeeshan Chemicals, on credit 5000
23-04-2016 Sold 1203units of paint items to IFFAT Industries,on credit 15881.775
Payment towards diesel for shipping, in cash 100
payment towards market research,in cash 200
remaining 20% of the payment received from iffat industries for the credit sale made on 03/04/2016(credit period=14
24-04-2016 days) 5448.223
penalty imposed @ 1% 12.71252033
Purchased 110 units of raw material bundles from zeeshan chemicals in cash 1000
discount availed 30
payment towards workshop conducted on industrial paints manufacturing best practices 200
20% of the remaining payment received from iffat industries for the credit sale made on 05/04/2016(credit period=14
25-04-2016 days) 2148
penalty imposed @ 1% 5.012
employee bonus paid, in cash 5000
26-04-2016 payment towards gift cards to main office staff 2000
paid principal amount as 2nd monthly instalment 17876.66667
Paid interest @ 10% pa on long term loan borrowed from SBI and the monthly payment of the Principal amount(5 years) 8789
27-04-2016 Paid electricity bill, in cash 100
Payment towards GOVINDA Caterers for month end feast, in cash 200
28-04-2016 payment towards employee kid's education scholarship,in cash 500
Paid wages to labourers and in-plant staff,through cash 7200
Paid salary to main office personnel, through cash 100
28-04-2016
29-04-2016
30-04-2016 factory maintenance

Ledger

(All items are in Rs000)

CASH a/c
dr. cr.
DATE a/c DATE a/c
01-04-2016 to bal c/d 24504.4
01-04-2016 gov grant a/c 53630
02-04-2016 sales a/c 8808.2499 01-04-2016 creditors a/c 53350
04-04-2016 sales a/c 3472.6 03-04-2016 supplies and raw material purchase a/c 4850
05-04-2016 debtors 25920 04-04-2016 Municipality taxes a/c 10480.033
09-04-2016 debtors 60480 05-04-2016 rent expenses a/c 500
11-04-2016 sales a/c 15413.1351 08-04-2016 fuel expenses a/c 100
12-04-2016 debtors 6480 08-04-2016 labor uniform charges a/c 500
12-04-2016 sales penalty 15.12
16-04-2016 debtors 15120 09-04-2016 consultant charges a/c 500
16-04-2016 sales penalty 35.28
17-04-2016 debtors 21792.892 09-04-2016 creditors a/c 67900
19-04-2016 debtors 8592 09-04-2016 supplies and raw material purchase a/c 5820
19-04-2016 sales a/c 14.0844 10-04-2016 advertisement expenses a/c 200
10-04-2016 miscellaneous expenses a/c 100
21-04-2016 short term investments a/c 85066 11-04-2016 maintenance charges a/c 200
21-04-2016 sales a/c 3819.86
 21-04-2016 sales a/c 5135.10725 15-04-2016 fuel expenses a/c 100
24-04-2016 debtors 5448.223 15-04-2016 supplies and raw material purchase a/c 3880
24-04-2016 sales penalty 12.71252033
25-04-2016 debtors 2148 16-04-2016 supplies and raw material purchase a/c 3880
25-04-2016 sales penalty 5.012 16-04-2016 creditors a/c 92150
345912 17-04-2016 R&D expenses 14.52
22-04-2016 consultant charges a/c 500
23-04-2016 fuel expenses a/c 100
24-04-2016 miscellaneous expenses a/c 200
24-04-2016 supplies and raw material purchase a/c 970
24-04-2016 miscellaneous expenses a/c 200
25-04-2016 miscellaneous expenses a/c 5000
26-04-2016 miscellaneous expenses a/c 2000
26-04-2016 loan a/c 17876.667
26-04-2016 interest expenses a/c 8789.3611
27-04-2016 electricity expenses 100
27-04-2016 miscellaneous expenses a/c 200
28-04-2016 miscellaneous expenses a/c 500
28-04-2016 wages a/c 7200
28-04-2016 salary a/c 100
balance 57652 288260.58

Bank a/c
01-04-2016 To Bal c/d 1000
bal 1000

capital a/c
01-04-2016 by balance c/d 524001.66
Bal 524001.66
DEBTORS a/c
01-04-2016 to bal c/d 108000 05-04-2016 Cash 25920
03-04-2016 sales a/c 27241.115 09-04-2016 Cash 60480
05-04-2016 sales a/c 10740 12-04-2016 Cash 6480
12-04-2016 sales a/c 35442 16-04-2016 Cash 15120
12-04-2016 sales a/c 24053.304 17-04-2016 Cash 21792.892
23-04-2016 sales a/c 15881.775 19-04-2016 Cash 8592
24-04-2016 Cash 5448.223
221358.194 25-04-2016 Cash 2148
balance 75377.079 145981.12

Plant machinery a/c

01-04-2016 to bal c/d 498279.1247 30-04-2016 depreciation a/c 4182.35

balance 494096.7747

inplant accessories a/c

01-04-2016 to bal c/d 3478.494624 30-04-2016 depreciation a/c 29.166667
balance 3449.327957

Building a/c
01-04-2016 to bal c/d 10923.92473 30-04-2016 depreciation a/c 91.666667
balance 10832.25806

Building accessories a/c

01-04-2016 to bal c/d 1393.225806 30-04-2016 depreciation a/c 11.666667
balance 1381.55914
furniture a/c
01-04-2016 to bal c/d 993.0107527 30-04-2016 depreciation a/c 8.3333333
balance 984.6774194

computer a/c
01-04-2016 to bal c/d 994.6236559 30-04-2016 depreciation a/c 8.3333333
balance 986.2903226

software package a/c

01-04-2016 to bal c/d 994.6236559 30-04-2016 depreciation a/c 8.3333333
balance 986.2903226

supplies and raw material purchase a/c

01-04-2016 to bal c/d 30000
03-04-2016 cash a/c 4850
03-04-2016 discount received a/c 150
09-04-2016 cash a/c 5820.00
09-04-2016 discount received a/c 180.00
15-04-2016 cash a/c 3880
15-04-2016 discount received a/c 120
16-04-2016 cash a/c 3880
16-04-2016 discount received a/c 120
24-04-2016 cash a/c 970
24-04-2016 discount received a/c 30
02-04-2016 creditors a/c 95000
22-04-2016 creditors a/c 5000
balance 150000

creditors a/c
01-04-2016 cash a/c 53350 01-04-2016 By balance c/d 125000
discount received a/c 1650
09-04-2016 cash a/c 67900 02-04-2016 supplies and raw material purchase a/c 95000
discount received a/c 2100
16-04-2016 cash a/c 92150 22-04-2016 supplies and raw material purchase a/c 5000
discount received a/c 2850
220000 225000
Balance 5000

sales a/c
02-04-2016 cash a/c 8808.2499
02-04-2016 discount given @3% 272.4201
04-04-2016 cash a/c 3472.6
04-04-2016 discount given @3% 107.4
11-04-2016 cash a/c 15413.135
11-04-2016 discount given @3% 476.6949
19-04-2016 cash a/c 14.0844
19-04-2016 discount given @3% 0.4356
21-04-2016 cash a/c 3819.86
21-04-2016 discount given @3% 118.14
21-04-2016 cash a/c 5135.1073
21-04-2016 discount given @3% 158.81775
03-04-2016 debtors a/c 27241.115
05-04-2016 debtors a/c 10740
12-04-2016 debtors a/c 35442
12-04-2016 debtors a/c 24053.304
23-04-2016 debtors a/c 15881.775
Balance 151155.14
municipality tax expenses a/c
04-04-2016 cash a/c 10480.03325
balance 10480.03325

rent expenses
a/c
05-04-2016 cash a/c 500
balance 500

miscellaneous expenses a/c

10-04-2016 cash a/c 100
24-04-2016 cash a/c 200
24-04-2016 cash a/c 200
25-04-2016 cash a/c 5000
26-04-2016 cash a/c 2000
27-04-2016 cash a/c 200
28-04-2016 cash a/c 500
balance 8200

loan a/c
26-04-2016 cash a/c 17876.66667 01-04-2016 by balance c/d 1054723
Bal 1036847

vehicle a/c
01-04-2016 to bal c/d 89370.96774 30-04-2016 depreciation a/c 750

bal 88620.96774

consultant charges a/c

09-04-2016 cash a/c 500
22-04-2016 cash a/c 500
balance 1000

labour uniform chares a/c

08-04-2016 cash a/c 500

balance 500

fuel expenses a/c

08-04-2016 cash a/c 100
15-04-2016 cash a/c 100
23-04-2016 cash a/c 100
bal 300

wages a/c
28-04-2016 cash a/c 7200
balance 7200

salary a/c
28-04-2016 cash a/c 100
balance 100

electricity expenses a/c

27-04-2016 cash a/c 100
balance 100
interest expenses a/c
26-04-2016 cash a/c 8789.361111
balance 8789.361111

discount allowed a/c

02-04-2016 sales a/c 272.4201
04-04-2016 sales a/c 107.4
11-04-2016 sales a/c 476.6949
19-04-2016 sales a/c 0.4356
21-04-2016 sales a/c 118.14
21-04-2016 sales a/c 158.81775
balance 1133.90835

sales penalty a/c

12-04-2016 Cash a/c 15.12
16-04-2016 Cash a/c 35.28
24-04-2016 Cash a/c 12.71252
25-04-2016 Cash a/c 5.012
Balance 68.12452

discount received a/c

03-04-2016 supply and raw materials a/c 150
09-04-2016 supply and raw materials a/c 180
15-04-2016 supply and raw materials a/c 120
16-04-2016 supply and raw materials a/c 120
24-04-2016 supply and raw materials a/c 30
01-04-2016 creditors a/c 1650
09-04-2016 creditors a/c 2100
16-04-2016 creditors a/c 2850
Balance 7200

short term investment a/c

01-04-2016 To bal c/d 933793 21-04-2016 short term investments a/c 85066

balance 848727

depreciation
a/c
30-04-2016 plant machinery a/c 4182.35
30-04-2016 building a/c 91.66666667
30-04-2016 building accessroies a/c 11.66666667
30-04-2016 computer a/c 8.333333333
30-04-2016 software package a/c 8.333333333
30-04-2016 vehicles a/c 750
30-04-2016 Inplant accessories a/c 29.16666667
30-04-2016 furniture a/c 8.333333333
balance 5089.85

R&D
expenses
DATE a/c DATE PARTICULARS
17-04-2016 cash a/c 14.52
bal 14.52

gov grant a/c

01-04-2016 cash a/c 53630
Bal 53630
advertisement expenses a/c
10-04-2016 cash a/c 200
bal 200

TRIAL BALANCE

(All items are in Rs000)

ITEMS Dr Cr
CASH 57652
BANK 1000.0
DEBTORS 75377.1
Raw materials and supplies 150000.0
short term investments 848727
Plant machinery 498279.1
adj depreciation 4182.4
Inplant accessories 3478.5
adj depreciation 29.2
Building 10923.9
adj depreciation 91.7
building accessories 1393.2
adj depreciation 11.7
Vehicles 89371.0
adj depreciation 750.0
Furniture 993.0
adj depreciation 8.3
Computer 994.6
adj depreciation 8.3
software package 994.6
adj depreciation 8.3
Creditors 5000.0
Loan 1036846.7
gov grant 53630.0
Capital 524001.7
Sale 151155.1
municipality tax expenses 10480.0
rent expenses 500.0
miscellaneous expenses 8200.0
consultant charges 1000.0
labor uniform charges 500.0
advertisement expenses 200.0
fuel expenses 300.0
maintenance charges 200.0
R& D expenses 14.5
elctricity expenses 100.0
wages 7200.0
Salary 100.0
interest expenses 8789.4
discounts received 7200.0
discounts allowed 1133.9
sales penalty 68.1
depreciation expenses 5089.9
1782991.443 1782991.443
 P&L for the month of April

(All items are in Rs000)

DR CR
PARTICULARS amt. PARTICULARS amt.
To opening stock 30000 By sales 151155.14
To Raw materials and supplies
purchased 120000 By closing stock 55608.868
To wages 7200
To maintenance charges 200
To labor uniform charges 500
To Gross profit 48864.007
municipality tax expenses 10480.033
rent expenses 500 By gross profit 48864.007
By discount
miscellaneous expenses 8200 received 7200
consultant charges 1000 sales penalty 68.12452
advertisement expenses 200
fuel expenses 300
elctricity expenses 100
Salary 100
R& D expenses 14.52
interest expenses 8789.3611
discounts allowed 1133.9084
depreciation expenses 5089.85
Net Profit 20224.459

BALANCE SHEET AS ON 30/04/2016

(All items are in Rs000)

Current assets Current liabilities
CASH 57652 Creditors 5000
BANK 1000
DEBTORS 75377.079 NONCURRENT LIABILITIES
SHORT TERM INVESTMENTS 848727 Loan 1036847
RAW MATERIALS CLOSING STOCK 55608.868 gov grant 53630
Total current Assets Total Liabilities

Non current assets CAPITAL 524001.66

Plant machinery 494096.77 RETAINED EARNINGS FROM P&L 20224.459
Inplant accessories 3449.328
Building 10832.258 Total owners equity
building accessories 1381.5591
vehicles 88620.968
FURNITURE 984.67742
COMPUTER 986.29032
SOFTWARE PACKAGE 986.29032
Total Noncurrent Assets
Total Assets 1639702.8 Total Liabilities and owners equity 1639702.8
 INVENTORY VALUATION USED

Manufacturing 1 unit of finished paint item requires 1 unit of raw material bundle.
1 unit of raw material bundle consists of the following
Pigment: 0.5 kg
resins: 0.3kg
additive agents: 0.2kg
Oil: 50litres

The raw materials are bought from the vendors in the form of bundles only

No of Raw material Price of raw

bundles bought material
bundle(Rs000)
01/04/2016 3000(opening stock) 10
02/04/2016 10000 9.5
03/04/2016 526 9.5
09/04/2016 631 9.5
15/04/2016 443 9.025
16/04/2016 443 9.025
22/04/2016 554 9.025
24/04/2016 110 9.025
total 15709

No of finished paint Price of the sale Total sales

item sold item(Rs000) volume(items*item price)
02/04/2016 687 13.2 9081
03/04/2016 2063 13.2 27241
04/04/2016 271 13.2 3500
05/04/2016 813 13.2 10740
11/04/2016 1203 13.2 15890
12/04/2016 2685 13.2 35442
12/04/2016 1822 13.2 24053
21/04/2016 298 13.2 3938
21/04/2016 401 13.2 5294
23/04/2016 1203 13.2 15882
total 9548 151155

Raw material bundles Inventory left at the end of the month=6161

Finished goods inventory=0 as the items are manufactured from the raw materials only on order.
Inventory valuation @ 9.025/bundle (last bundle bought @9.025/bundle) is 55608(using FIFO
method)
Closing stock of raw material(Rs000)= 55608
 COMPLIANCE STATEMENT

1. Date of birth 31/03/1989, date of commencement of business 01/03/2016.

2. Contributed capital= 31x173 Rs lakhs (Roll No B16173, Day of birth: 31)=536300( Rs000)
Long term loans = 2xcapital=2x536300=1072600
3. Grant from gov. availed
4. Total Fixed assets purchased=611382 (38% of long term funds)
5. Depreciation has been calculated for the fixed assets as per Straight line method from the date
of purchase till the end of the month. Life of all the Fixed asset items is taken as 10 years.
6. Total Cash sales=37796, Total credit sales=113358; credit/cash sales=3/1
7. Total Cash Purchases=20000, Total credit Purchases=100000
8. Credit period of 14 days (both for sales and purchase) has been followed
9. NA
10. Total cash balance at the end of the month=58652(including the bank)
Total cash expenses:288260; so clearly cash balance at the end of the month is between (3-7/20)
of the cash expenses during the month. No need of investment is short term investments
required as the cash balance was within the allowable limit
11. NA
12. complied
13. All the payments have been made on time by the company and hence discount of 3% has been
availed. A discount of 3% has been allowed when payments have been received on time from
parties.
14. NA
15. Complied @1%
16. Interest paid @ 10% =8789, 1st instalment of principal paid=17876
17. NA
18. Sales price=13.2/unit(Increased by 10% from march price), raw material price=9.5/unit
(30/03/2016), 9.025/unit on (14/04/2016), 8.57/unit on (28/04/2016)[decreased by 5% every 15
days]; sales volume=1.05 times march sales;(april:151155, march:144000; ratio=1.05 )
19. Complied
20. Sales and purchases of items were started once the machinery had been setup.
21. Municipal rates=10480(2% of owners equity at the beginning of the month)
22. Wage cost=7200 (5%-25%of total sales)
23. NA
24. Complied
 Transactions for the Month of May

DATE PARTICULARS Amt.(Rs000)

Paid monthly land rent in cash 500
01-05-2016 payment towards municipality taxes,cash 10883
diesel charges for shipping 100
02-05-2016 truck maintenance charges 400
received delayed payments from qatar industries for transaction on 12/04/2016 35442
penalty imposed 59
received delayed payments from iffat industries for transaction on 12/04/2016 24053
03-05-2016 penalty imposed 56
plant preventive maintenance charges 200
Credit Purchases of raw material from Zeeshan( 12149 bundles) 104168
04-05-2016 credit sales to Iffat Industries,8197 units 119034
05-05-2016 Off
PAID in cash to zeeshan for transaction on 22/04/2016 5000
06-05-2016 discount availed 150
07-05-2016 80% payment received from iffat industries for transaction on 23/04/2016 12705
Raw material purchases from Zeeshan, in cash(2429 bundle units) 20834
discount availed 625
08-05-2016 swatcha bharat abhiyan inititiative expenses ,cash 200
sales Promotion expenses,cash 1000
09-05-2016 diesel charges for shipping 100
Bought uniforms,hand gloves,nose masks,eye gears for labourers(provided every month) 500
10-05-2016 expenses for sports function held amongst employees family members 200
buisness consultant charges 400
11-05-2016 Expenses towards sponshorship of a tele-event 2000
cash sales to Qatar industries,3307 units 39678
discount allowed 1190
12-05-2016 plant preventive maintenance charges 200
13-05-2016 OFF
20% of the remaining payment received from iffat industries for the credit sale made on 23/04/2016(credit period=14 days) 3176
14-05-2016 sales penalty 32
Safety awareness programme expenses 200
15-05-2016 expenses towards marketing research,cash 400
16-05-2016 Total Power failure and natural calamity, lack of demand from market
17-05-2016 OFF
Paid Zeeshan chemical for payment of the raw material purchased on credit on 04/05/2016, in cash 104168
discount availed 3125
18-05-2016 80% payment received from iffat industries for transaction on 04/05/2016 95227
19-05-2016 OFF
R&D expenses 2000
20-05-2016 charges for arrangement of client visit to plant 100
Donation to An NGO 2, cash 5000
21-05-2016 expenses for providing individual health kit to labourers 500
Payment towards GOVINDA Caterers (function for celebration of winning best safe plant award), in cash 1000
22-05-2016 Natural calamity relief donation 5000
expenses towards hiring skill upgradation team 1000
Sold Inter-corporate securities worth Rs10000000 10000
23-05-2016 main office stationary expenses 200
20% of the remaining payment received from iffat industries for the credit sale made on 04/05/2016(credit period=14 days) 23807
sales penalty 238
25-05-2016 Paid wages to labourers and in-plant staff, CASH 7200
Paid Electricity Bill 700
26-05-2016 factory-Surrounding area development expenses 500
 Paid salary to main office personnel, through cheque 100
27-05-2016 payments for De-contamination of the equipments for increasing the productivity 500
Payment towards diesel for shipping, in cash 100
payments to local puja committee 100
paid interest @10% for the loan taken 8640
3rd instalment of principal paid 17877
28-05-2016 Invested in inter-corporate market security. 67953
29-05-2016
30-05-2016
31-05-2016 complete machinery overhaul

LEDGER

(All items are in Rs000)

CASH
DR CR
DATE a/c DATE a/c
01-05-2016 rent expenses a/c 500
01-05-2016 to bal c/d 57652 01-05-2016 Municipality taxes a/c 10883.036
03-05-2016 debtors a/c 35442 02-05-2016 fuel expenses a/c 100
03-05-2016 sales penalty a/c 59.07 02-05-2016 maintenance charges a/c 400
03-05-2016 debtors a/c 24053.304 04-05-2016 miscellaneous expenses a/c 200
03-05-2016 sales penalty a/c 56.124376 06-05-2016 creditors a/c 4850
07-05-2016 debtors a/c 12705.42 08-05-2016 supplies and raw material purchase a/c 20208.66
12-05-2016 sales a/c 38487.66 08-05-2016 miscellaneous expenses a/c 200
14-05-2016 debtors a/c 3176.355 09-05-2016 advertisement expenses a/c 1000
14-05-2016 sales penalty a/c 31.76355 09-05-2016 fuel expenses a/c 100
18-05-2016 debtors a/c 95227.2 10-05-2016 labor uniform charges a/c 500
23-05-2016 Short term investments 10000 10-05-2016 miscellaneous expenses a/c 200
25-05-2016 debtors a/c 23806.8 11-05-2016 consultant charges a/c 400
25-05-2016 sales penalty a/c 238.068 11-05-2016 miscellaneous expenses a/c 400
12-05-2016 maintenance charges a/c 200
300935 15-05-2016 miscellaneous expenses a/c 200
15-05-2016 miscellaneous expenses a/c 400
18-05-2016 creditors a/c 101043.3
20-05-2016 R&D expenses a/c 2000
20-05-2016 miscellaneous expenses a/c 100
21-05-2016 miscellaneous expenses a/c 5000
21-05-2016 miscellaneous expenses a/c 500
22-05-2016 miscellaneous expenses a/c 1000
22-05-2016 miscellaneous expenses a/c 5000
23-05-2016 miscellaneous expenses a/c 1000
balance 41180 24-05-2016 miscellaneous expenses a/c 200
25-05-2016 wages a/c 7200
26-05-2016 electricity expenses a/c 700
26-05-2016 miscellaneous expenses a/c 500
27-05-2016 salary a/c 100
27-05-2016 miscellaneous expenses a/c 500
28-05-2016 fuel expenses a/c 100
28-05-2016 miscellaneous expenses a/c 100
28-05-2016 interest expenses 8640.3889
28-05-2016 loan a/c 17876.667
28-05-2016 short term investments a/c 67953
Bank a/c
01-05-2016 To Bal c/d 1000
bal 1000

capital a/c
01-05-2016 By balance c/d 544226.12
balance 544226.12

DEBTORS a/c
01-05-2016 to balnce c/d 75377.079 03-05-2016 cash a/c 35442
04-05-2016 sales a/c 119034 03-05-2016 cash a/c 24053.304
07-05-2016 cash a/c 12705.42
14-05-2016 cash a/c 3176.355
18-05-2016 cash a/c 95227.2
25-05-2016 cash a/c 23806.8
194411.08 194411.08
balance 0

creditors a/c
06-05-2016 cash a/c 4850 01-05-2016 by bal c/d 5000
06-05-2016 discount availed 150
18-05-2016 cash a/c 101043.3 04-05-2016 supplies and raw material purchase a/c 104168.35
18-05-2016 discount availed 3125.0505
balance 0

supplies and raw material purchase a/c

01-05-2016 to bal c/d 55608.868
08-05-2016 cash a/c 20208.66
08-05-2016 discount received 625.0101
04-05-2016 creditors a/c 104168.35
balance 180610.89

sales
12-05-2016 cash 38487.66
12-05-2016 discount allowed 1190.34
04-05-2016 debtors a/c 119034
balance 158712

discounts received
06-05-2016 creditors a/c 150
18-05-2016 creditors a/c 3125.0505
08-05-2016 supplies and raw material purchase a/c 625.0101
bal 3900.0606

discounts allowed
12-05-2016 sales a/c 1190.34
bal 1190.34
sales penalty a/c
03-05-2016 cash a/c 59.07
03-05-2016 cash a/c 56.124376
14-05-2016 cash a/c 31.76355
25-05-2016 cash a/c 238.068
balance 385.02593

municipality tax expenses a/c

01-05-2016 cash a/c 10883.036
balance 10883.036

rent expenses a/c

01-05-2016 cash a/c 500
balance 500

miscellaneous expenses a/c

DATE a/c DATE PARTICULARS
04-05-2016 cash a/c 200
08-05-2016 cash a/c 200
11-05-2016 cash a/c 200
15-05-2016 cash a/c 400
15-05-2016 cash a/c 200
20-05-2016 cash a/c 400
21-05-2016 cash a/c 100
21-05-2016 cash a/c 5000
22-05-2016 cash a/c 1000
23-05-2016 cash a/c 5000
24-05-2016 cash a/c 1000
26-05-2016 cash a/c 200
27-05-2016 cash a/c 500
10-05-2016 cash a/c 500
28-05-2016 cash a/c 100
bal 15000

loan a/c
DATE a/c DATE PARTICULARS
28-05-2016 cash a/c 17876.667 01-05-2016 by bal c/d 1036847
bal 1018970

vehicle a/c
DATE a/c DATE PARTICULARS
01-04-2016 to bal c/d 89370.968 30-04-2016 depreciation a/c 751.01654
bal 88619.951

consultant charges a/c

DATE a/c DATE PARTICULARS
11-05-2016 cash a/c 400
balance 400

labor uniform chares a/c

DATE a/c DATE PARTICULARS
10-05-2016 cash a/c 500
balance 500
fuel expenses a/c
02-05-2016 cash a/c 100
09-05-2016 cash a/c 100
28-05-2016 cash a/c 100
balance 300

wages a/c
25-05-2016 wages a/c 7200
balance 7200

salary a/c
27-05-2016 salary a/c 100
balance 100

electricity expenses a/c

26-05-2016 electricity expenses a/c 700
balance 700

interest expenses a/c

28-05-2016 interest expenses 8640.3889
balance 8640.3889

short term investment a/c

01-05-2016 to bal c/d 848727 23-05-2016 cash a/c 10000
28-05-2016 cash a/c 67953
balance 906680

depreciation a/c
31-05-2016 plant machinery a/c 4182.35
31-05-2016 building a/c 91.666667
31-05-2016 building accessroies a/c 11.666667
31-05-2016 computer a/c 8.3333333
31-05-2016 software package a/c 8.3333333
31-05-2016 vehicles a/c 750
31-05-2016 Inplant accessories a/c 29.166667
31-05-2016 furniture a/c 8.3333333
balance 5089.85

R&D expenses
20-05-2016 cash a/c 2000
bal 2000

gov grant a/c

01-05-2016 by bal c/d 53630
bal 53630

advertisement expenses a/c

09-05-2016 cash a/c 1000
bal 1000

maintenance charges
02-05-2016 maintenance charges a/c 400
12-05-2016 maintenance charges a/c 200
bal 600
Plant machinery a/c
01-05-2016 to bal c/d 494096.77 31-05-2016 depreciation a/c 4182.35
balance 489914.42

inplant accessories a/c

01-05-2016 to bal c/d 3449.328 31-05-2016 depreciation a/c 29.166667
balance 3420.1613

Building a/c
01-05-2016 to bal c/d 10832.258 31-05-2016 depreciation a/c 91.666667
balance 10740.591

Building accessories a/c

01-05-2016 to bal c/d 1381.5591 31-05-2016 depreciation a/c 11.666667
balance 1369.8925

furniture a/c
01-05-2016 to bal c/d 984.67742 31-05-2016 depreciation a/c 8.3333333
balance 976.34409

computer a/c
01-05-2016 to bal c/d 986.29032 31-05-2016 depreciation a/c 8.3333333
balance 977.95699

software package a/c

DATE a/c DATE PARTICULARS
01-05-2016 to bal c/d 986.29032 31-05-2016 depreciation a/c 8.3333333
balance 977.95699
vehicles
DATE a/c DATE PARTICULARS
01-05-2016 to bal c/d 88620.968 31-05-2016 depreciation a/c 750
bal 87870.968
 TRIAL BALANCE

(All items are in Rs000)

ITEMS dr cr
CASH 41181
BANK 1000
DEBTORS 0
Raw materials and supplies 180611
short term investments 906680
Plant machinery 494097
adj depreciation 4182
Inplant accessories 3449
adj depreciation 29
Building 10832
adj depreciation 92
building accessories 1382
adj depreciation 12
Vehicles 88621
adj depreciation 750
Furniture 985
adj depreciation 8
Computer 986
adj depreciation 8
software package 986
adj depreciation 8
Creditors 0
Loan 1018970
gov grant 53630
Capital 544226
Sale 158712
municipality tax expenses 10883
rent expenses 500
miscellaneous expenses 15000
consultant charges 400
labor uniform charges 500
advertisement expenses 1000
fuel expenses 300
maintenance charges 600
R& D expenses 2000
elctricity expenses 700
Wages 7200
Salary 100
interest expenses 8640
discounts received 3900
discounts allowed 1190
sales penalty 385
depreciation expenses 5090
1784913 1784913
 P&L for May

(All items are in Rs000)

DR CR
PARTICULARS amt. PARTICULARS amt.
To opening stock 55609 By sales 158712
To Raw materials and supplies purchased 125002 By closing stock 31286
To wages 7200
To maintenance charges 600
To labor uniform charges 500
To Gross profit 1087
municipality tax expenses 10883
rent expenses 500 By gross profit 1087
miscellaneous expenses 15000 By discount received 3900
consultant charges 400 sales penalty 385
advertisement expenses 1000
fuel expenses 300
elctricity expenses 700
Salary 100
R& D expenses 2000
interest expenses 8640
discounts allowed 1190
depreciation expenses 5090
Net Profit -40431

BALANCE SHEET as on 31/05/2016

(All items are in Rs000)

Current assets Current liabilities

cash 41181 creditors 0
bank 1000
debtors 0 Noncurrent liabilities
short term investments 906680 loan 1018970
raw materials closing stock 31286 gov grant 53630
Total Current assets 980146 Total liabilities 1072600

Non current assets capital 544226.12

plant machinery 489914 retained earnings from p&l -40431
Inplant accessories 3420
Building 10741 Total owners equity 503794
building accessories 1370
vehicles 87871
furniture 976
computer 978
software package 978
Total noncurrent assets 596248
Total Assets 1576395 Total liability and owners equity 1576395
 INVENTORY VALUATION USED

Manufacturing 1 unit of finished paint item requires 1 unit of raw material bundle.
1 unit of raw material bundle consists of the following
Pigment: 0.5 kg
resins: 0.3kg
additive agents: 0.2kg
Oil: 50litres

The raw materials are bought from the vendors in the form of bundles only

No of Raw material Price of raw

bundles bought material
bundle(Rs000)
01/05/2016 55608(opening stock) 8.57
04/05/2016 104168 8.57
08/05/2016 20208 8.57
total 180610

No of finished paint Price of the sale Sales

item sold item(Rs000) volume(items*item
price)
04/05/2016 12149 14.52 119034
12/05/2016 2732 14.52 38487
Total 158712

Raw material bundles Inventory left at the end of the month=3649

Finished goods inventory=0 as the items are manufactured from the raw materials only on order.
Inventory valuation @ 8.57/bundle as on 31/03/2016 is 31285(using FIFO method)
Closing stock of raw material(Rs000)= 31285

COMPLIANCE STATEMENT

1. Date of birth 31/03/1989, date of commencement of business 01/03/2016.

2. Contributed capital= 31x173 Rs lakhs (Roll No B16173, Day of birth: 31)=536300( Rs000)
Long term loans = 2xcapital=2x536300=1072600
3. Gov grant already availed in april
4. Total Fixed assets purchased=611382 (38% of long term funds)
5. Depreciation has been calculated for the fixed assets as per Straight line method from the date
of purchase till the end of the month. Life of all the Fixed asset items is taken as 10 years.
6. Total Cash sales=38487, Total credit sales=119034(3:1)
7. Total Cash Purchases=20208, Total credit Purchases=104168(5:1)
8. Credit period of 14 days (both for sales and purchase) has been followed
9. NA
10. Total cash balance at the end of the month=42180(including the bank)
 Total cash expenses:192302; so clearly cash balance at the end of the month is between (3-7/20)
of the cash expenses during the month. Excess cash has been invested in short term investments
to keep the cash balance in allowable limit.
11. NA
12. complied
13. All the payments have been made on time by the company and hence discount of 3% has been
availed. A discount of 3% has been allowed when payments have been received on time from
parties.
14. NA
15. Complied @1%
16. Interest paid @ 10% =8640, 3rd instalment of principal paid=17876
17. NA
18. Sales price=14.52/unit, raw material price=10/unit (15/03/2016), 9.5/unit on
(30/03/2016),9.025/unit on 14/04/2016),8.57/unit on 28/04/2016, 8.14/unit on 12/05/2016
19. Complied
20. Sales and purchases of items were started once the machinery had been setup.
21. Municipal rates=10883(2% of owners equity at the beginning of the month)
22. Wage cost=7200 ( 5%-25 % of total sales)
23. NA
24. Complied