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Drafting balance sheet and p & l

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Uma Srilekha Gadepalli

260 Points Posted on 27 May 2023

filed itr 4 showing income u/s. 44AD.

Turnover - 17,60,000

net profit offered @ 20% - 352,000

o/s is around 258,000

c/s is around 231,000

purchases is around 15,80,000 (excluding GST)

now, the assessee is intending to apply for loan and as usual bank asked for balance sheet and p&l

now, for preparing a drafted p&l, the maximum gross profit we could get is around 153,000.

but we have a met profit around 352,00.

how can we adjust this??

please give your suggestions......

Replies (5)

Quick Summary

This discussion addresses a common challenge for businesses filing ITR 4 under Section 44AD: preparing a balance sheet and P&L for a bank loan when the declared net profit differs significantly from the potential gross profit. The user needs to reconcile a net profit of £352,000 with a maximum achievable gross profit of £153,000. Suggestions include adjusting closing stock, purchase values, or exploring options like advances to suppliers.

You have to either adjust with purchase Value. Try to find any purchase transaction without GST or either paid in cash. Try to Show Advance to supplier and show purchase in subsequent year.