FINAL ACCOUNT- Adjustment 2

12th BOOK KEEPING BY AJAYSANTHOSH MOURYA

Sr.No.	Type of Adjustment	Adjustment Entry	How dealt with in
			Trading or Profit and Loss A/c	Balance Sheet
6	Interest on Capital	Interest on Capital A/c   Dr	Debit side of Profit and Loss A/c	Liabilities side by
		To Capital A/c		by way of
				addition to the
				Capital
7	Interest on Drawings	Capital A/c                     Dr	Credit side of the Profit and Loss	Liabilities side by
		To Interest on Drawing		way of addition to
				the drawings
				which are
				u l t i m a t e l y
				deducted from
				the Capital.
8	Interest on Loan (Interest on Bank)	Interest A/c                   Dr	Debit side of Profit and Loss A/c	Liabilities side
		To Interest Outstanding A/c	by way of addition to the	by way of
		Example:	appropriate interest A/c	addition to the
		Interest on Bank Loan A/c		particular loan
		To Interest Outstanding A/c		A/c
9	Interest on Investments	Accrued Interest	Credit side of Profit and Loss A/c	Assets side by
		on investments A/c       Dr	by way of addition to the	way of addition
		To Interest received A/c	appropriate interest A/c.	to the particular
				investment A/c
10	Depreciation on Fixed Assets	Depreciation A/c           Dr	Debit side of Profit and Loss A/c.	Assets side by
		To Fixed Asset A/c		way of deduction
		Example:		from the
		Depreciation A/c           Dr		concerned asset
		To Machinery A/c		account.
11	Bad debts	Bad debts A/c               Dr	Debit side of Profit and Loss A/c	Assets side by
		To Sundry debtors A/c		way of deduction
				from
				Sundry debtors