SAMANVYA BUILDING

Workings
Assets = Liabilities + OE
2004
3000000 Cash 3000000 Loan

1500000 Cash 1500000 Cont. Cap.

-1500000 Cash
1500000 Land

-1500000 Cash
1500000 Building

-500000 Cash
500000 Building (Repairs)

-120000 Cash
120000 Repaint

-300000 Cash -300000 Loan

-300000 Cash
300000 Building (Interest)

2005
400000 Cash 400000 Deposit Payable

288000 Cash 288000 Revenue (3 clients)

80000 Cash -16000 Deposit Payable 96000 Revenue (Khanna)

88000 Cash 96000 Revenue (Khan)

8000 Rent Rec.
 80000 Cash 80000 Deposit Payable

-300000 Cash -300000 Loan

-270000 Cash -270000 Int. Exp.

-40000 Cash -20000 Tax

-10000 Eelectricity
-10000 Telephone
-60000 Cash
60000 Prp. Ins
-15000 Prp. Ins -15000 Ins. Exp.

-115000 Accm Dep. -115000 Dep. Exp.

-40000 Repaint -40000 Repaint Exp

0 Profit

Assets Liab+OE
Building 2185000 Loan 2400000
Land 1500000 Depost 464000
Rent Rec. 8000 Capital 1500000
Prpd Ins 45000
Rpaint 80000
Cash 546000
TOTAL 4364000 TOTAL 4364000
Samanya Building
Income statement for the year ended 2005
Parti
Revenue
From 3 clients 288000
From Khanna 96000
From Khan 96000 480000

Expenses
Interest exp -270000 Principal reduces to 27 lakh
Tax -20000
Electricity -10000
Insurance exp -15000
Depreciation -115000
Repaint -40000
Telephone -10000 -480000
Net Income/Loss 0
Samanya Building
Balance Sheets as of 31st December 2005

Assets Amt Liabilities and Shareholders' Equity Amt

Building (Net)* 2185000 Loan 2400000
Land 1500000 Deposit 464000
Prepaid insurance 45000 Capital 1500000
Rent Receivable 8000
Prepaid paint 80000
Cash 546000

4364000 4364000

* Cost of an item of PPE includes all expenditures incurred that are necessary to make the asset ready for its intended use (p. 1
That is why we include both repairs and first year's interest in the cost. These are known as pre-operative expenses.
t ready for its intended use (p. 175, AHM, "Items included in Cost").
operative expenses.