Mr. Ali is running \"Hyper StarTraders\" a sole proprietorship business located

Question

Mr. Ali is running "Hyper StarTraders" a sole proprietorship business located at the Mall Road,Lahore. At the year end the business has:

Furniture Rs. 40,000

Plant 200,000

On 30th November 2009 Mr.Ali submitted a tender for sale of goods of Rs. 20,000 which islikely to be confirmed shortly. Bank debited service charges Rs.150 and interest on loan Rs. 500 and credited dividend for Rs.2,000 in the month of December (intimation from bank was receivedon 7th January 2010). Mr. Ali also estimates that 5% of the amountwill not be collectable from sundry debtors. House rent allowanceRs. 5,000 has been paid on 31st December from his personal account,on the same date stock was valued at Rs. 200,000 and plant Rs.160,000 because of its wear and tear.

The following balances (inthe books of Hyper Star Traders) are also given along with aboveinformation as on 31st December 2009:

Particulars Rs.Particulars Rs.

Opening stock120,000 Bank balance 36,000

Sundry Debtors100,000 Bills payable 20,000

Long termInvestments 60,000 Returns outwards 4,800

Returns inwards8,000 Commission 2,000

Purchases 680,000Sales 924,000

Cash in hand 4,000Interest received 800

Bills receivable44,000 Sundry Creditors 160,000

Carriage out 3,600Salaries 48,000

Support your solutionwith complete working/calculationswhere necessary.

Marks will bededucted if completeworking/calculations are not shown.

Explanation / Answer

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