Q 3 - Suppose in January, a shopkeeper Purchases 5 Mobile Phones @ 10000 each It sells 2 Mobile Phones @ 16000 each Calculate Profit and Loss
View answer
Since,he has Sold only 2 Pieces,we take purchase price of 2 pieces only to calculate Profit
| Particulars | Amount |
| Sales (16000*2) | 32000 |
| Less Purchase(10000*2) | 20000 |
| Profit | 12000 |
Make Profit and Loss in this Case
In Profit and Loss,we show full Purchases of 5 pieces
2 pieces which we have not sold,we show as Closing Stock
| PROFIT AND LOSS ACCOUNT | |||
| Expenses | Amount | Income | Amount |
| Purchases | 50000 | Sales | 32000 |
| (10000*5) | (16000*2) | ||
| Profit | 12000 | Closing Stock | 30000 |
| (62000-50000) | (10000*3) | ||
| Total | 62000 | Total | 62000 |
What is Closing Stock?
Stock Which we have not purchased but not sold is called Closing Stock
It is shown on Right Side in Profit and Loss
Is Closing Stock Valued at Purchase Price or Sales Price?
It is valued at Purchase Price
Example;-In our case,Closing Stock is calculated at purchase Price of 30000(3 piece *10000=30000)
What is Opening Stock
Stock which we have at beginning of a month or year is called Opening Stock
Closing Stock of Last Month becomes Opening Stock of Current Month
Q 4 - Continuing Last Question There were 3 Mobile Phone Closing Stock left in Janaury All 3 were sold in February at 18000 each Prepare Profit and Loss of Feb
View answer
| PROFIT AND LOSS ACCOUNT | |||
| Expenses | Amount | Income | Amount |
| Opening Stock | 30000 | Sales | 54000 |
| (10000*3) | (18000*3) | ||
| Purchases | 0 | ||
| Profit | 24000 | Closing Stock | 0 |
| Total | 54000 | Total | 54000 |
Q - 5
| Particulars | Quantity | Rate | Amount |
| Opening Stock | 3 | 30000 | 90000 |
| Purchase | 5 | 30000 | 150000 |
| Sales | 6 | 40000 | 240000 |
| Closing Stock | 2 | ? | ? |
Calculate Value of Closing Stock
View answer
Closing Stock is Valued at Purchase Price
Value of Closing Stock=2*30000=60000
| Particulars | Quantity | Rate | Amount |
| Closing Stock | 2 | 30000 | 60000 |
Calculate Profit and Loss in this Case
| PROFIT AND LOSS ACCOUNT | |||
| Expenses | Amount | Income | Amount |
| Opening Stock | 90000 | Sales | 240000 |
| Purchases | 150000 | Closing Stock | 60000 |
| Profit | 60000 | ||
| Total | 300000 | Total | 300000 |
Q - 6 - Suppose Next month
| Particulars | Quantity | Rate | Amount |
| Opening Stock | 2 | 30000 | 60000 |
| Purchase | 10 | 30000 | 300000 |
| Sales | 11 | 50000 | 550000 |
| Closing Stock | 1 | ? | ? |
View answer
Calculate Value of Closing Stock
| Particulars | Quantity | Rate | Amount |
| Closing Stock | 1 | 30000 | 30000 |
Calculate Profit and Loss in this Case
| PROFIT AND LOSS ACCOUNT | |||
| Expenses | Amount | Income | Amount |
| Opening Stock | 60000 | Sales | 550000 |
| Purchases | 300000 | Closing Stock | 30000 |
| Profit | 220000 | ||
| Total | 580000 | Total | 580000 |