Problem: 1

1. Mr. Ram started business with cash Rs. 3, 00,000.

2. Purchases 10 Ctv’s from ABC & Co @ Rs. 15,000 each.
3. Purchases 15 Ctv’s for cash @ Rs. 15,000 each.
4. Paid carriage on purchases Rs. 500.
5. Cash sales 10 Ctv’s @ Rs. 20,000 each.
6. Sales to Shalimar & co 15 Ctv’s @ Rs. 20,000 each.
7. Paid salaries Rs. 4,000 & Rent 1,000.

Answers:
Gross Profit: 1, 24,500 Net profit: 1, 19,500 B/S: 5, 69,500
Problem: 2

1. Mr. Gandhi commenced business with cash Rs. 5,00,000

2. Purchase Furniture worth Rs. 80,000 for business use.
3. Deposited in ICICI bank Rs. 1,00,000
4. Purchase Office desk paid by cheque Rs. 2,000
5. Purchase 10 CD players from Aiwa & co.@Rs. 7000 each
6. Paid carriage Rs. 250
7. Sold 5 CD players for cash @Rs.9000 each.
8. Sold 5 CD players to ‘X’ & Co. @Rs.9000 each.
9. Paid Salaries Rs. 3,000
10. Paid Rent Rs.2,500.

Answers:
Gross Profit: 19,750 Net Profit: 14,250 B/S: 5,84,250
Problem: 3

1. Mr. R.S. Reddy started business with capital Rs. 3, 00,000.

2. Purchase from XYZ & Co.
50 Shirts @ Rs. 150 each
100 Trousers @ Rs. 200 each
3. Cash Sales
30 Shirts @ Rs. 200 each
70 Trousers @ Rs. 250 each
4. Sales to Vijay & Co
20 Shirts @ Rs. 200 each
30 Trousers @ Rs. 250 each
5. Paid to XYZ & Co. Rs. 25,000.
6. Received Cash from Vijay & Co. Rs. 10,000.
7. Paid Salaries Rs. 3,000.
8. Paid Rent Rs. 2,000.

Answers:
Gross Profit: 7,500 Net profit: 2,500 B/S: 3, 05,000

Problem: 4

1. Mr. Leave started business with capital Rs. 5, 00,000.

2. Purchase from A-Z furniture.
50 Tables @ Rs. 200 each
200 Chairs @ Rs. 150 each
3. Cash Purchase
20 Boards @ Rs. 5,000 [5,00 only]
4. Sales to Princess Esen School
5 Boards @ Rs. 400 each
50 Chairs @ Rs. 200 each
20 Tables @ Rs. 250 each
5. Cash Sales
10 Boards @ Rs. 400 each
100 Chairs @ Rs. 200 each
 Charge 10 % Sales Tax
6. Returned to A-Z furniture
5 Tables, 10 Chairs
7. Paid to A-Z furniture Rs. 15,000
8. Received cash from Princess Esen School in full settlement of his
account.
9. Paid Salaries Rs. 5,000 & Rent Rs. 2,000.

Answers:
Gross Profit: 11,750 Net profits: 4,750

B/S: 5, 30,150 Closing Stock: 8,250

Problems 5

1. Mr. Babu started business with cash Rs.5,00,000

2. Purchased 15 audio systems @Rs.5,000 each for cash
3. Paid carriage on purchases Rs.200
4. Sold 10 audio systems @Rs.6500 each for cash+10% sales tax.
5. Sold 3 audio systems @Rs.6500 to Mr.Vikrant+10% sales tax
6. Cash withdrawn from business for personal use Rs.10,000
7. Paid Salaries Rs.5,000
Electricity charges Rs.1,000
Rent Rs.2,000

Answers:
Closing stock: 10,000 Gross Profit: 19,300
Net Profit: 11,300 Balance Sheet:
5,09,750