Page 357 - VIRANSH COACHING CLASSES

2) Application Funds
Fixed Assets 60,000
Investment 10,000

Working Capital
Current Assets 55,000
Less : Current Liabilities (-) 30,000 25,000

Total Fund Applied 95,000

2 : Convert following Balance Sheet into Vertical Balance Sheet
Balance Sheet as on 31st March, 2020

Liabilities Amount (`) Assets Amount (`)
Capital 80,000 Fixed Assets 75,000
Reserves and Surplus 20,000 Investment 20,000
12%Loan 24,000 Current Assets 44,000
Current Liabilities 15,000

1,39,000 1,39,000
Solution No. 2
Vertical Balance Sheet as on 31st March, 2020
Amount Amount
Particulars
(`) (`)
I) Sources of Funds (Owners Fund)

1) Capital 80,000
+ Reserves 20,000
Net Worth 1,00,000
2) Borrowed Funds
12% Loan +24,000
Total Fund Available 1,24,000
II) Application of Funds
3) Fixed Assets 75,000
4) Investment 20,000

5) Working Capital
Current Assets 44,000
Less : Current Liabilities (−)15,000 29,000
Total Fund Applied 1,24,000

2) Income Statement: The Profit & Loss account need to be arranged in vertical format which is
suitable for further analysis. It is also called as vertical Income Statement. Its format is given
below :

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