Hire purchase Problem....??

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Goods sold on HP at cost plus 50%

1- stock with customers at HPP (opening) Rs 162000

2- stock in hand at shop (opening) Rs.324000

3- Instalments overdue(opening) Rs.135000

4- purchases during the year Rs 1080000

5- Goods repossesed(instalment not due Rs. 36000) Rs. 9000

6- stock at shop excluding goods repossesed (closing) RS 360000

7- cash recieved during the year Rs 1035000

8- Instalments overdue(closing) Rs162000

Vendor spent Rs2000 on goods repossesed and then sold it for Rs15000. Calculate Profit/loss on repossession and profit/loss on sale? Kindly show workings also if possible...

Thanks in advance...

Replies (9)

Ronak Choudhary

CA Final Article

130 Points Joined September 2008

dude this is a question asked in PCC exams..check out d institute site for the PCC Accounts compiler n download compiler for this chapter..usme iska ans hai...i've solved it..par onlin solve karke dena would be no use to u..so better check it out urself from the compiler..

SACHIN KUMAR GARG

Final Student

105 Points Joined February 2010

Hi Faiz

HP Stock A/c
To Bal. B/D	162000	By Good repossesed	36000
To Stock at Shop	1035000	By HP Debtors	1071000
		By Bal. C/D (bal. fig.)	90000
Total	1197000		1197000


HP Debtors A/c
To Bal. B/D	135000	By Cash	1035000
To HP Stock (bal. fig.)	1071000	By Bal. C/D	162000
		By Good Repossesed	9000
Total	1206000		1206000


Good Repossesed A/c
To HP Stock	36000	By Cash (resale)	15000
To HP Debtors	9000	By HP Adj A/c	32000
To Cash (exp)	2000
Total	47000		47000

HP Adj A/c				W.N
To Good Repossed A/c	32000	BY Stock Reserve (Op. Bal)	54000	162000/3
To Stock Reserve (cl. Bal.)	30000	By Loading	345000	1035000/3
To P&L A/c	337000
Total	399000		399000

VUELVE

CA- Student

351 Points Joined February 2010

what is the correct answer ?

triumph-CMA

Chartered Accountant

508 Points Joined February 2009

HPP of goods sold on HP rs. 1566,000

Closing HP Stock Rs. 6,30,000

Profit on HP Rs. 3,39,000

Profit on sale of rep. goods Rs. 4,000.

SACHIN KUMAR GARG

Final Student

105 Points Joined February 2010

is m wrong?. pls, give ur working

triumph-CMA

Chartered Accountant

508 Points Joined February 2009

Stock at shop account

To balance b/d	3,24,000	By G .S. On H.P (bal. fig.)	10,44,000
To Purchases	10,80,000	By balance c/d	3,60,000
Total	14,04,000	Total	14,04,000

G.S. on Hire Purchase A/c

To Stock at shop A/c	10,44,000	By H.P. Stock A/c	15,66,000
To H.P. Adj. A/c (loading)	5,22,000
Total	15,66,000	Total	15,66,000

triumph-CMA

Chartered Accountant

508 Points Joined February 2009

H.p. Stock A/c

To balance C/d	1,62,000	By H.P. debtors A/c	10,62,000
To G.s On Hire Purchase	15,66,000	By repossessed Stock A/c	36,000
		By balance c/d (bal. fig)	6,30,000
	17,28,000		17,28,000

H.P debtors A/c

To balance b/d	1,35,000	By cash A/c	10,35,000
To H.P. Stock A/c (bal. fig)	10,62,000	By balance c/d	1,62,000
	11,97,000		11,97,000

H.P. Stock reserve A/c

To H.P Adj. A/c	54,000	By balance b/d
To balance c/d		(162,000 X 50/150)	54,000
(6,30,000X50/150)	2,10,000	By H.P Adj A/c	2,10,000
	2,64,000		2,64,000

Repossessed Stock A/c

To H.P Stock A/c	36,000	By H.P Adj A/c	9,000
		By H.P Adj A/c
		By balance C/d (agreed value)	27,000
	36,000		36,000
To balace B/d	9,000	By bank A/c	15,000
To bank (expns)	2,000
To H.P Adj A/c	4,000
	15,000		15,000

Hire Purchase Adjustment A/c

To repossessed Stock ( Loss on repossession)		By H.P stock reserve	54,000
To repossessed Stock ( Loss on repossession)	27,000	By G.S. On Hire purchase	5,22,000
By H.P Stock reserve	2,10,000	By Repossessed Stock (profit on sale of repossessed goods
By gen P/L A/c	3,43,000
			4,000
	580,000		5,80,000

this profit includes profit on sale of repossion Rs. 4,000 and profit on hire purchase rs. 3,39,000

triumph-CMA

Chartered Accountant

508 Points Joined February 2009

Under Debtors method

H.P Trading account

To H.P Stock (Opening)	1,62,000	By H.P . Stock res.
To H.P debtors (op)	1,35,000	(1,62,000X50/150)	54,000
To G.S on H.P (1)	15,66,000	By G.S On H.P (loading)
To H.P stock reserve		(15,66,000X50/150)	5,22,000
(6,30,000X50/150)	2,10,000	By Cash A/c	10,35,000
To Gen P/L A/c	3,39,000	By Rep. stock A/c (agreed value)	9,000
		By H.P Stock (2)	6,30,000
		By H.P debtors	1,62,000
	24,12,000		24,12,000