Question 25 of 35beginner💡 UnderstandShort Answer3 marks
Give the Performa of income statement and balance in vertical form.
Correct Answer
Income Statement (Vertical Form)
| Particulars | Amount (₹) | Amount (₹) |
|---|---|---|
| Sales | XXX | |
| Less: Sales Return | (XXX) | |
| Net Sales | XXX | |
| Less: Cost of Goods Sold | ||
| Opening Stock | XXX | |
| Purchases | XXX | |
| Less: Purchases Return | (XXX) | |
| Wages | XXX | |
| Carriage | XXX | (XXX) |
| Gross Profit | XXX | |
| Less: Operating Expenses | ||
| Administrative Exp. | XXX | |
| Selling & Dist. Exp. | XXX | (XXX) |
| Net Profit | XXX |
Balance Sheet (Vertical Form) As at...
| Sources of Funds | Amount (₹) |
|---|---|
| Shareholder's Funds | |
| Capital | XXX |
| Add: Net Profit | XXX |
| Less: Drawings | (XXX) |
| Loan Funds | |
| Loan (Long-term) | XXX |
| Total Funds Employed | XXX |
| Application of Funds | Amount (₹) |
| --- | --- |
| Fixed Assets | |
| Machinery | XXX |
| Land & Building | XXX |
| Current Assets | |
| Stock | XXX |
| Debtors | XXX |
| Cash | XXX |
| Less: Current Liabilities | |
| Creditors | (XXX) |
| Bills Payable | (XXX) |
| Net Current Assets (Working Capital) | XXX |
| Total Assets Employed | XXX |
Exercise: Short Answers | Q: 4 | (Chapter: 51)
For More Understanding
Explanation
Although the provided textbook context illustrates the Horizontal (T-shaped) format with 'Liabilities' and 'Assets' columns, the question specifically requests the Vertical form. The vertical format presents the financial statements in a 'T-account' style (top-down) rather than a 'Two-sided' style. The structure provided above uses the standard account titles found in the context (like Capital, Creditors, Machinery, Debtors) but arranges them in the required vertical Performa suitable for analysis.