FM Assignment #1 Fall-2017

Q No.1 Following Trial balance and adjustment data is presented by Saleem Textile Mills
Ltd at the end of its financial year Dec.31,2016.

TITLE OF ACCOUNT DEBIT CREDIT

CASH 45,000
A/C RECEIVABLE 20,000
EQUIPMENT 35600
ADVERTISING EXPENSE 3,000
PREPAID RENT 6,000
MISCELLANEOUS EXPENSE 2,000
OFFICE SUPPLIES EXPENSE 1,000
INTEREST EXPENSE 500
MDS. INVENTORY-BEGINNING 7,000
PURCHASES 25,000
CARRIAGE IN 200
SALES RETURN 900
SALARIES EXPENSE 8,000
ACCUMULATED DEPRECIATION-EQUIPMENT 2800
SALES REVENUE 80,000
PURCHASES RETURN 800
PURCHASES DISCOUNT 300
COMMISSION INCOME 2,500
A/C PAYABLE 5,500
COMMON STOCK 39,800
NOTE PAYABEL 5,000
RETAINED EARNING 7,500
LONG-TERM LOAN 10,000
TOTAL 154,200 154,200

ADJUSTMENT DATA ON DEC.31,2016:

1. Depreciation charged @ 5% on non-current assets

2. Income tax 34%
3. Merchandise Inventory-ending Rs.1700

Required:
1. Prepare Income Statement
2. Prepare Balance Sheet
 Q No.2 Karachi Traders provided following Trial Balance on December 31, 2016 and
adjustment data.

TITLE OF ACCOUNT DEBIT CREDIT

CASH 145,000
A/C RECEIVABLE 175,000
OFFICE EQUIPMENT 350,000
MARKETING EXPENSE 12,500
PREAPID ADVERTISING 8,500
OTHER EXPENSE 6,000
OFFICE SUPPLIES EXPENSE 3,500
INTEREST EXPENSE 16,000
MDS. INVENTORY-BEGINNING 27,800
PURCHASES 275,000
TRANSPORTATION-IN 22,000
SALES RETURN 12,000
SALARIES EXPENSE 65,000
ACCUMULATE DEPRECIATION-EQUIPMENT 25,000
SALES REVENUE 675,000
PURCHASES RETURN 1800
PURCHASES DISCOUNT 4500
INTEREST INCOME 27,000
A/C PAYABLE 35,000
COMMON STOCK 222,300
SHORT-TERM LOAN 55,000
RETAINED EARNING 22,700
LONG-TERM LOAN 50,000
TOTAL 1,118,300 1,118,300

Adjustment data
1. Depreciation on non-current assets @ 10%
2. Income Tax 40%
3. Merchandise Inventory-ending 12500

Required:
1. Prepare Income Statement
2. Prepare Balance sheet