Accountancy Project On Bajaj

COMPREHENSIVE PROJECT

RAMA’S CYBER CAFE

Mr Rama decided to commerce a computer business in a building which was constrained at a cost of Rs 1,00,000 and contributed a further sum of Rs 2,50,000. He wanted to start with 10 computers. He went on to HDFC bank and put up his proposal and managed to get a loan to the extend of his 75 per cent of the cost of the computer Rs 4,00,000 with pointers it was agreed that the loan was rapid in three annual instalments as follows

  • At the end of first year = Rs 1,00,000 + 30000 interest
  • At the end of 2nd year = Rs 1,00,000 + 20000 interest
  • At the end of the 3rd year = Rs 1,10,000 (Rs 1,00,000+10000 interest)

He started business on 1st Apr 2019 on the same date he deposited Rs 2,40,000 in the bank. He gave Rs 1,00,000 to the computer company as 25 % of the values of computer purchase & Rs 3,00,000 out of bank loan availed. He deposited Rs 10000 0 with VENL for the telephone. Internet connection he got the computer code finished by paying Rs 25,000 and also spent Rs 4520 in getting pamphlets printed and distributed. All payments were to be made by cheques and all the receipts were in each to deposited in the bank on the same day. At the end of the year, their results showed the following.

  • Revenue from fees from students of computer class                                 2,80,000
  • Revenue an account of internet facility                                                      1,20,000
  • Revenue from sale of computer stationary                                                 98,000
  • Purchase of computer stationary like floppy disk CDs etc.                       55,000
  • Telephone chargers                                                                                     34,000           
  • Petty expenses                                                                                             12,000
  • Entertainment expenses                                                                               10,000
  • Miscellaneous expenses                                                                               10,000
  • Wages paid to servant                                                                                  6,000

He withdraws 61,000 by cheque each month for their personal expenses. He paid the bank loan regularly.

REQUIRED

  • Journalise the above transactions. But then into the edge and prepare trial balance
  • Prepare profit loss and balance sheet after taking into account that electricity charges of Rs 124,000 yet to be paid.
  • Charge depreciation at the rate of 25% on computers 10% on furniture and 5% on building
  • Calculate profitability ratio and comment on the efficiency of the busines if the net profit ratio and cross profit in similar type of business concerns are 20% and 50% respectively.
  • Mr Rama wants to expand his business. He approached that bank for further loan. Compose the ratio that the banker will require before granting the loan. Current ratio. Quick ratio and debt equity ratio.

JOURNAL ENTRY

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DateParticularLFDr (Rs)Cr (Rs)
2019    
AprilCash Ac 2,50,000 
 Building Ac 1,00,000 
 To capital Ac  3,50,000
 (being capital invested in the business)   
AprilBank Ac 2,40,000 
 To cash Ac  2,40,000
 (being cash deposited in Bank)   
AprilBank Ac 3,00,000 
 To bank Ac  3,00,000
 (being loan taken HDFC bank)   
AprilComputer Ac 4,00,000 
 To bank Ac  4,00,000
 (being computer purchasing paying Rs 4,00000)   
AprilElectricity board Ac 1,000 
 VSNL Ac 1,01,0001,01,000
 (being security deposits with electricity board and VSNL)   
AprilFurniture and fixtures Ac 25,000 
 To bank Ac  25,000
 (being café furniture)   
AprilAdvisement Ac 4,500 
 To bank Ac  4,500
 (being cheque issued for advisement)   
31MarDepreciation Ac 1,07,500 
 To computer Ac  1,00,000
 To furniture Ac  2,500
 To building Ac  5,000
 (being depreciation charged )   

LEDGER POSTING

CASH A/C

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2019 1 APRILTo capital Ac 2,50,0002019 1AprBy bank Ac By balance 2,40,000 10,000
        
        
   2,50,000   2,50,000
        

BUILDING   

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2019 1 AprilTo capital Ac 1,00,0002020 31MARBY Dep Ac By B/c Cid 5,000 9,5,000
        
   1,00,000   1,00,000
        

CAPITAL A/C  

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2020 31MarTo B/c c/d 3,50,0002019 1AprBy buildings By cash Ac 1,00,000 2,50,000
    1Apr   
   3,50,000   3,50,000
        

COMPUTER A/C

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2019 1 AprTo bank Ac 4,00,0002020 31 MarBy Dep Ac By B/c c/d 1,00,000 3,00,000
        
       4,00,000

BANK A/C

DateParticularLFAmountDateparticularLFamount
2019   2019By computer A/c 4,00,000
1 AprilTo cash A/c 2,40,0001 Apr   
1 AprilTo bank loan A/c 3,00,0002020   
2020   31 MarBy electricity based 1000
31MarTo sales 4,9800031 MarBy VSNL A/c 1,00,000
    31 MarBy furniture 25,000
    31 MarBy advertisement 4500
    31 MarBy purchase A/c 55,000
    31 MarBy telephone EP 341000
    31 MarBy daily expenses 121000
    31 MarBy entertainment 10,000
    31 MarBy miscellaneous A/c 10,000
    31 MarBy wages A/c 6000
    31 MarBy bank wan 72,000
    31 MarBy b/c c/d 1,30,000
2020  10,38,000   10,38,000
1 AprTo balance b/d 1,78,500    

  BANK LOAN A/C         

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2020 31 MarTo bank Ac 1,30,0002019 1 AprBy bank Ac   3,00,000  
31 MarTo b/c c/d 2,00,00031 MarBy int on bank loan 30,000
       3,30,000
   3,30,000    
    2020 1 AprBY b/c b/d 2,50,000

ELECTRICITY BOARD A/C

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DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2019 1 AprTo bank Ac 10002020 31 MarBy B/c c/d 1000
2020 1 AprilTo b/c b/d 1000   1000
   1000    

VSNL A/C

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2019 1 AprTo bank Ac 1,00,0002020 31 MarBy b/c c/d 1,00,000  
   1,00,000   1,00,000
   1,00,000    

SALES A/C

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2020 31MarTo trading Ac 4,80,0002020 31 MarBy bank Ac   4,38,000  

PURCHASE A/C

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2020 31 MarTo bank Ac 55,0002020 31 MarBy trading Ac   55,000  
   55,000    

FURNITURE A/C

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2019 1 AprTo bank Ac 25,0002020 31 MarBy Dep Ac By B/c c/d 2500 22,500
        
       25,000

ADVERTISEMENT A/C

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2019 1 AprTo bank Ac 45002020 31 MarBy P&L AC 4500

TELEPHONE CHARGES A/C

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DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2019 1 AprTo bank Ac 34,0002020 31 MarBy P&L Ac   34,000

INTEREST OF BANK LOAN A/C

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2020 31MarTo bank loan Ac 30,0002020 31 MarBy P&L Ac   80,000  

ENTERTAINMENT EXPENSES A/C

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2020 31 MarTo bank Ac 10,0002020 31 MarBy P&L Ac   10,000

 DRAWING A/C

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2020 31 MarTo bank Ac 72,0002020 31 MarBy b/c c/d 72,000  
   72,000    
       72,000

PETTY EXPENSE

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2020 31 MarTo bank Ac 12,0002020 31 MarBy P&L AC 12,000  

 WAGES A/C

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2020 31 MarTo bank Ac 6,0002020 31 MarBy trading Ac 6,000  

DEPRECIATION

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2020 31 MarTo computer Ac 1,00,0002020 31 MarBy P&L Ac 1,07,500  
31MarTo furniture Ac 2900    
31MarTo building Ac 5000    
   1,07,500   1,07,500

MISCELLANEOUS EXPENSES A/C

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2020 31 MarTo bank Ac 10,0002020 31 MarBy P&L Ac 10,000  

ELECTRICITY CHARGES  A/C

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2020 31 MarTools electricity 1,24,0002020 31 MarBy P&L Ac 1,24,000  

 ELECTRICITY PAYABLE A/C

DATEPARTICULARLFAMOUNTDATEPARTICULARLFAMOUNT
2020 31 MarTo B/C C/D 1,24,0002020 31 MarBy electricity charge 1,24,000  
   1,24,000    
       1,24,000

TRIAL BALANCE

TRIAL BALANCE AS OF SLOT MAR, 2020

PARTICULARAMOUNT
Cash Ac10,000
Building Ac95,000
Bank Ac1,79,500
Computer Ac3,00,000
Electricity board Ac1,000
VSNL Ac1,00,000
Furniture Ac22,500
Advertisement Ac4,500
Purchase Ac55,000
Telephone charge Ac34,000
Petty expense Ac12,000
Entertainment expense Ac10,000
Miscellaneous expense Ac10,000
Wages Ac6000
Drawing Ac72,000
Int. on Bank  loan Ac30,000
Dep Ac1,07,500
Electricity charges Ac1,24,000
Capital Ac3,50,000
Bank loan Ac2,00,000
Electricity payable Ac1,24,000
Revenue from fees & sales Ac4,98,000
  
 11,72,000

TRADING AND PROFIT AND LOSS

TRADING AND PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31MAR 2020

PARTICULARAMOUNT
To purchase Ac55,000
To wages6,000
To gross profit4,37,000
 4,98,000
To advertisement Ac4,500
To electricity Ac1,84,000
To telephone charge Ac34,000
To petty expenses Ac12,000
To entertainment expenses Ac10,000
To Int. on bank loan Ac10,000
To depreciation Ac 
Computer1,00,000
Building5,000
Furniture2,500
To set profit1,05,000
By sales4,98,000
By gross profit4,37,000
  
 4,37,000

BALANCE SHEET

BALANCE SHEET AS OF 31 MAR 2020

LIABILITIESAMOUNTASSETAmount
Bank loan2,00,000Cash in hand10,000
Electricity payable Ac1,24,000Bank1,78,500
  VSNL(security deposit)1,00,000
Capital      3,50,000 Electricity based (S.D)1,000
Less : drawing   (72,000) Computer3,00,000
2,78,000 Building95,000
Add net profit   1,05,0003,83,000Furniture22,500
 7,07,000 7,07,000
    

CALCULATION OF PROFITABILITY RATIO

  • Gross profit Ratio
    Gross profit/Net sake x100 =  4,37,000/4,98,000 x 100 = 87.75%
  • Net profit Ratio
    Net profit/Net sake x 100 =  1,05,000/4,98,000 x 100 = 21.08%      
    Note:  efficiency of business is quite satisfactory because net profit ratio and gross profit ratio are higher than the normal rate for similar type pf business organisation       

Note:  efficiency of business is quite satisfactory because net profit ratio and gross profit ratio are higher than the normal rate for a similar type of business organisation

  • Granting bank loan

Bank will see the following ratios before granting a loan :

  • Current Ratio : current Asset/Current liabilities
    = cash + Bank/ Electricity payable + bank loan to repaid next year
    = 10,000+8,600/1,00,000 + 1,24,000 =1,88,500  = 84%
  • Quick current ratio will be same on current ratio because there is neither closing stock nor prepaid expenses
  • Debt equity Ratio
    Debt/Equity =   1,00,000/3,83,000   = 0.26:1

The bank therefore should grant the loan as the ratio are favourable.

SPECIFIC PROJECT

BAJAJ AUTO LTD

Bajaj Auto is a global two-wheeler and three-wheeler Indian manufacturing company. It manufacturing and sells motorcycles, scooter, and auto-rickshaws Bajaj Auto is a part of the Bajaj Group. It was founded by Jamnalal Bajaj in Rajasthan in the 1940s. it is based in Pune, Mumbai with plants in Chakan (Pune), Waliej (near Aurangabad ) and the patter is Uttaranchal. Bajaj Auto is the 6th largest manufacturer of motorcycles in the world and 2nd largest in India. It is the world’s largest three-wheeler is manufactured.

NET PROFIT RATIO

Net profit = profit/sales  x 100   

SegmentProfitSalesRatio
Automotive1616.297425.1521.76%
Investment362.79363.4699.91%
Total1979.057788.61121.57%

RETURN ON INVESTMENT

Return on Investment = profit/Capital employed   x 100                                  

SegmentProfitCapital employedROI(%)
Automotive1616.295032.4632.11%
Investment362.7918346.471.97%
Total1979.0523378.9334.08%

SEGMENT PROFIT

Percentage = segment profit/Total profit x 100

Degree = percentage/100 x 360

SegmentProfitPercentage of totaldegree
Automotive16116.2981.66%294’
Investment362.7918.33%66.99’
Total1979.0599.99%359.99’
SegmentProfitPercentage of totaldegree
Automotive16116.2981.66%294’
Investment362.7918.33%66.99’
Total1979.0599.99%359.99’

SEGMENT PROFIT

Percentage = segment profit/Total profit x 100
Degree = percentage/100 x 360

SegmentProfitPercentage of totaldegree
Automotive16116.2981.66%294’
Investment362.7918.33%66.99’
Total1979.0599.99%359.99’

SEGMENT REVENUE

Percentage = segment profit/Total profit x 100
Degree= percentage/100 x 360

SegmentRevenuePercentage of totalDegree
Automotive7425.1596.33%343.2’
Investment363.464.66%16.79’
Total7788.699.99%359.99’

CAPITAL EMPLOYED

Percentage = segment profit/Total profit  x 100
Degree = percentage/100 x 360

SegmentCapital employedPercentageDegree
Automotive5032.4621.01%75.65’
Investment18346.4776.61%276.8’
Unallocated568.472.37%8.54’
Total23947.499.99%359.99’

COMBINED ANALYSIS

SegmentRevenueProfitCapital employedReturn on investmentNet profit ratio
Automotive7425.151616.255032.4632.11%21.31%
Investment363.46362.7918346.471.97%99.81%
Unallocated568.47
total7788.611979.0523947.434.08121.37%

OPERATING ACTIVITIES

MEANING
Operating activities are principal revenue-generating activities of an enterprise other than increasing financing activities. The amount of cash flow arising from operating is a key indicator of the eaten to which the operations of the enterprise have generated cash i.e. whether the cash. Generated is adequate to maintain operating activity of the enterprise pay dividend pay loan etc.
INFLOWS
Cash sales, cash received from debtors

FINANCING ACTIVITIES

Financing activities are the activities that result in a change in the size & composition of finance of the enterprise. The amount of cash flow arising from financing activities to useful & associating crime so future cash flows by procurement of funds to the enterprise

INFLOWS
The issue of future, issue of share

Comparative statement of operating activities for the year ended

31st March 2018-19

Particular31Mar 201931Mar 2018Absolute change%  Change
Cash inflows (outflow)27186.864327.84(1840.98)42.59%

Comparative statement of financing activities for the year ended

31 March 2018-19

Particular31Mar 201931Mar 2018Absolute change%  Change
Cash inflows (outflow)(2074.06)(1885326)188.7910.01%  

Comparative statement of Investment activities for the year ended

2018-19

Particular31Mar 201931Mar 2018Absolute change%  Change
Cash outflow(338.44)(2053.09)(1714.65)83.51%

ACKNOWLEDGEMENT

I would like to give my heartfelt thanks to Mr Oevender Kumar Mourya My accountancy teacher who always gave valuable suggestions and guidance for the completion of this project. He helps to understand and remember the important details of this project. My project has been succeeded only because of his guidance. I would like to thank Mr. (principal of our school) for his capital support in the project. And I would also like to thank all those people who directly or indirectly support the completion of the project

Date  
Signature
Roll number :
Place: Delhi     

CERTIFICATE

This is herby to certify that, the original and genuine investigation work has been carried out to investigate the subject matter and the related data collection and investigation has been completed and solely sincerely and satisfactorily done by. Rakesh Rathore a student of class 12 under Roll No. for the academic session 2019-20Regarding the investigatory project entitled.AccountancyFor physics department under the direct supervision of the undersigned as per the requirement for the board examination.

Internal Examiner                             Principle                                         External

                     

                    

                       

                    

                

                     

 

               

                          

    


                                 

                                                                                                              

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