Question
Explain the utility of cold storage.

Answer

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Explain the principle of utmost good faith in a contract of insurance.
Mr. P.H. Mehta is in business. The following balances were extracted from the books as on 31.12.2022. You are required to prepare the Trading Account and the Profit and Loss Account for the year ended 31.12.2018 and the Balance Sheet as on that date.
Debit (₹)Credit (₹)
Capital1,98,000
Drawings10,000
Purchases and Returns Outward1,18,800500
Salaries21,650
Rate and Taxes950
Office Lighting and Cooling2,700
Import Duty2,200
Insurance250
Agency Commission900
Advertising5,000
Returns Inward and Sales3,48,500
Bad Debts800
Postage and Telegrams800
Discount Received150
Carriage for Door Delivery to Customers1,400
Opening Stock6,200
Wages27,700
Plant and Machinery2,05,000
Land and Buildings1,10,000
Furniture and Fittings3,000
Sundry Debtors and Creditors39,60020,000
Cash at Bank10,000
Petty Cash Balance200
5,67,1505,67,150

Closing stock on 31.12.2022 was ₹48,700.
The following is the trial balance of Mr. P. Crooke as on 31.03.2023.
Debit (₹)Credit (₹)
Stock at Start30,000
Fuel & Gas5,600
Capital & Drawings8,0003,50,000
Debtors30,000
Bills Receivable & Payable12,0008,000
Additional Drawings (other than cash)4,000
Carriage9,000
Purchases & Sales1,90,0003,40,000
Bank Accounts15,0005,000
Creditors16,000
Returns5,00020,000
Office Administrative Expenses44,000
Loans (given & borrowed)10,0001,00,000
Petty Cash & Cash Balances2,000
Postage & Telegrams900
Printing & Stationery7,500
Wages20,000
Salaries14,000
Land1,50,000
Factory & Office Premises80,000
Machineries2,10,000
Commission8,000
8,47,0008,47,000
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(i) Stock in the Godown as on 31.3.2023 is ₹35,000.
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