Financial Accounting & Analysis December 2025

Q.1: A company has the following trial balance as on 31st March 2024:

Additional Information: (a) Closing stock is valued at Rs.2,50,000. (b) Outstanding wages Rs.10,000; prepaid rent Rs.5,000. (c) Depreciate furniture by 10%. (d) Create a provision for doubtful debts at 5% of debtors. (e) Goods worth Rs.20,000 were withdrawn by the proprietor for personal use but not recorded. Prepare the Trading and Profit & Loss Account and Balance Sheet after making all necessary adjustments. Show all calculations and clearly indicate the impact of each adjustment on the final accounts.

Answer:

Introduction:

The preparation of final accounts is a crucial step in accounting as it reflects the financial position and profitability of a business. A company maintains a trial balance to ensure that all ledger balances are correctly recorded and that total debits equal total credits. However, the trial balance alone does not provide a complete picture of the company’s financial performance, as certain adjustments are necessary at the year-end to account for outstanding expenses, prepaid expenses, depreciation, provisions, and personal withdrawals. These adjustments ensure compliance with the accrual principle, matching principle, and prudence concept in accounting.

NMIMS University Online Solved Assignment – December 2025

Buy complete NMIMS solved assignments for the December 2025 session.

General/Generic Assignment at just ₹200 per assignment.

Customized/ Unique Assignment at just ₹500 per assignment.

Contact No: +91 9741410271 (WhatsApp)

OR

Mail to: smu.assignment@gmail.com

Our website: https://mbaassignmentsolutions.com

Q.2: Given the following ratios and partial data for a company as at 31st March 2024, reconstruct the missing values and prepare a summarized Balance Sheet.

Additional Information:

- Assume all sales are on credit, and closing inventory equals opening inventory

- There are no prepaid expenses or outstanding incomes

- Fixed Assets amount to Rs.8,00,000

- Share Capital is Rs.6,00,000

Calculate: (a) Inventory, (b) Debtors, (c) Current Assets, (d) Cost of Goods Sold, (e) Gross Profit, (f) Total Assets, and (g) Prepare a summarized Balance Sheet as at 31st March 2024.

Answer:

Introduction:

The preparation of a Balance Sheet from given financial ratios is a common analytical exercise in accounting and finance, aimed at understanding a company’s liquidity, operational efficiency, and financial position. In the present case, a company’s financial snapshot as of 31st March 2024 is partially provided, including ratios such as the Current Ratio, Quick Ratio, Inventory Turnover Ratio, Gross Profit Ratio, and Debtors Turnover Ratio, along with partial monetary values like Cash & Bank Balances, Fixed Assets, and Share Capital. The challenge lies in reconstructing missing values like Inventory, Debtors, Cost of Goods Sold (COGS), Gross Profit, Current Assets, and Total Assets using the given ratios and relationships among financial items.

Q.3 (A): A company’s cash flow statement for the year ended 31st March 2024 is to be prepared using the indirect method. The following information is available:

Additionally, during the year, the company sold machinery with a book value of Rs.50,000 at a loss of Rs.10,000 (already included in net profit). (a) Prepare the cash flow from operating activities section, showing all adjustments and calculations. (b) Explain the impact of the machinery sale on the cash flow statement and reconcile the loss on sale.

Answer:

Introduction:

The cash flow statement is a key financial statement that provides insights into a company’s inflows and outflows of cash during a particular period. It helps stakeholders understand how well the company generates cash from its operating, investing, and financing activities. Among the methods of preparing the cash flow statement, the indirect method is commonly used for operating activities. This method starts with net profit before tax and adjusts for non-cash expenses, changes in working capital, and other items such as gains or losses on the sale of assets. It highlights the reconciliation between accounting profit and actual cash generated from operations, giving a clear view of liquidity and operational efficiency.

Q.3 (B): A retail chain processes thousands of transactions daily, making manual posting from journals to ledgers impractical and error-prone. The finance team seeks an automated solution that can correctly apply double-entry principles, classify accounts (personal, real, nominal), and facilitate quick generation of trial balances for management review. Propose a system for automating the posting of journal entries to ledgers in a business with high transaction volumes, while ensuring accuracy in the application of debit and credit rules and the classification of accounts. How would your system address potential errors and support timely extraction of trial balances?

Answer:

Introduction:

In modern retail businesses, thousands of financial transactions occur daily, making manual accounting inefficient, slow, and prone to errors. Accurate posting from journals to ledgers is critical, as errors can distort financial statements and affect management decisions. An automated system for journal entry posting can significantly enhance accuracy, efficiency, and timeliness. Such a system would ensure that every transaction adheres to double-entry accounting principles, correctly classifies accounts into personal, real, or nominal categories, and enables rapid preparation of trial balances. Automation reduces human error, speeds up processing, and provides management with reliable financial data for decision-making.