Short answers : Solutions of Questions on Page Number : 474
NCERT Solutions for Class 11 Accountancy Chapter 4 – Accounting for Not-for-Profit Organisation
Q1 :State the meaning of ‘Not-for-Profit’ Organisations.
Answer : Not-for-Profit Organisations (NPO) are set up with the prime objective of providing services and not to earn profit thereby enhancing the welfare of society. Such organisations include schools, hospitals, trade unions, religious organisations, etc. The person/s or the groups of individuals who govern and manage the working of an NPO are known as trustees. NPO’s main sources of income are donations, subscriptions, life membership fees, grants etc. As these organisations are not set up with profit motive, they do not prepare Trading and Profit and Loss Account. Instead, they maintain Receipt and Payments Account, Income and Expenditure Account and Balance Sheet.
Q2 :State the meaning of Receipt and Payment Account.
Answer :
Receipts and Payments Account is a summary of the Cash Book. All cash receipts are recorded on the Receipts side (i.e. Debit side) and all cash payments are recorded on the Payments side (i.e. Credit side) of Receipts and Payments Account. It is prepared on the basis of cash and bank transactions recorded in the Cash Book. It begins with the opening balance of cash and bank and ends with the closing balances of cash and bank (balancing figure) at the end of the accounting period. It records all cash and bank transactions both of capital and revenue nature. It not only records the cash and bank transactions relating to the current accounting period, but also the cash and bank receipts (or payments) received during the current accounting period that may be related to the previous or next accounting period.
This account only helps us to ascertain the closing balance of the cash and bank and helps in assessing the cash position of an NPO.
Q3 :State the meaning of Income and Expenditure Account.
Answer : Income and Expenditure Account (I&E) is similar to the Profit and Loss Account in the sense that while the former is prepared to ascertain surplus or deficit during an accounting period, the latter is prepared to ascertain net profit or net loss incurred during an accounting period. I&E Account is a nominal account and is prepared on the accrual basis. It records all transactions of revenue nature that are related to the current accounting period (whether outstanding or prepaid) for which the books are maintained. All expenses and losses are recorded on the debit side (Expenditure side) and all income and gains are recorded on the credit side (Income side) of I&E Account. The closing balance or the balancing figure of I&E Account is termed as surplus (or deficit), if the sum total of the Income side exceeds (is lesser than) the sum total of the Expenditure side.
Q4 :What are the features of Receipt and Payment Account?
Answer :
The following are the features of Receipt and Payment Account:
1. Nature: It is a Real Account. It is a summarised version of Cash Book.
2. Nature of Transactions: It records only cash and bank transactions. Transactions other than cash and bank like depreciation, loss/ profit on sale of assets, etc. are not recorded in this account.
3. No distinction between Capital and Revenue items: It records all cash and bank receipts and payments of both capital and revenue nature.
4. Opening and closing balance: It begins with the opening balance of cash and bank and ends with the closing balance of the cash and bank (balancing figure) at the end of the accounting period.
5. Purpose: It reveals the cash position of an organisation. It helps to ascertain the total amount paid and received during an accounting period.
Q5 :What steps are taken to prepare Income and Expenditure Account from a Receipt and Payment Account?
Answer :
The following steps are taken to prepare Income and Expenditure Account (I&E) from Receipts and Payment Account (R&P).
Step 1: All the revenue expenditures paid for the current accounting period are transferred from the Payments side of R&P to the Expenditure side of I&E.
Step 2: All the revenue receipts for the current accounting period are transferred from the Receipts side of R&P to the Income side of I&E.
Step 3: Expenses outstanding for the current period and expenses paid in advance (prepaid expenses) for the current period in the preceding accounting periods are to be added (adjusted) to their related expenses in the Step 1.
Step 4: Income outstanding (accrued income) for the current period and income received in advance for the current period in the preceding accounting periods are to be added (adjusted) to their related incomes in Step 2.
Step 5: Non-cash items like depreciation, appreciation for the current accounting period are to be adjusted in the I&E.
Step 6: After adjusting all the revenue items for the current accounting period, the Income and the Expenditure sides are totaled. If the sum total of the Income side exceeds (or is lesser than) the sum total of the Expenditure side, then the balancing figure is termed as surplus (or deficit).
Q6 :What is subscription? How is it calculated?
Answer :
Subscription is the main source of income for an NPO besides entrance fees, donations, grants, etc. Subscriptions refer to the amount of money paid by the members on periodic basis for keeping their membership with the organisation alive. It is paid monthly, quarterly, half yearly or annually by the members.
It is shown in the debit side of the Receipt and Payment Account with the total amount received during the year that may be related to the current period and to the previous and next accounting period.
While calculating subscription for the current period, advance subscription received for the current period in the previous period and outstanding subscription for the current period are added to the subscription received during the current period. Whereas, on the other hand, advance subscription received for the next accounting period during the current period and outstanding subscription for the preceding period are deducted from the subscription received during the current period.
Calculation of Subscription
|
Subscription received during the year |
*** |
|
|
Add: Subscription received (in advance) during |
*** |
|
|
Add: Subscription outstanding at the end of the |
*** |
|
|
*** |
||
|
Less: Subscription received in advance for the |
*** |
|
|
Less: Subscription outstanding for the previous |
*** |
*** |
|
## Subscription shown in Income and Expenditure |
*** |
## This subscription is related to the current accounting period and is shown in the Income side of the Income and Expenditure Account.
Q7 :What is Capital Fund? How is it calculated?
Answer :
Capital fund is the excess of NPOs’ assets over its liabilities. In other words, the excess of assets over the liabilities for a profit earning organisation is termed as capital and the same for an NPO is termed as capital fund. Any surplus or deficit ascertained from Income and Expenditure account is added to (deducted from) the capital fund. It is also termed as Accumulated Fund.
Calculation of Capital Fund
|
Capital Fund at the beginning of the |
** |
|
|
Add: Surplus from Income and Expenditure Account |
** |
|
|
Add: Subscription Amount (Capitalised amount) |
** |
|
|
Add: Life membership fee. |
** |
** |
|
Less: Deficit from Income and Expenditure |
** |
|
|
Capital Fund at the end of the year |
*** |
Numerical questions : Solutions of Questions on Page Number : 474
Q1 :From the following particulars taken from the Cash Book of a health club, prepare a Receipts and Payments Account.
|
Particulars |
Rs |
|
Opening balance: |
|
|
Cash in Hand |
5,000 |
|
Cash at Bank |
25,000 |
|
Subscriptions |
1,65,000 |
|
Donations |
35,000 |
|
Investment Purchased |
80,000 |
|
Rent Paid |
20,000 |
|
General Expenses |
21,500 |
|
Postage and stationery |
2,000 |
|
Courier charges |
1,000 |
|
Sundry Expenses |
2,500 |
|
Closing Cash in Hand |
12,000 |
Answer :
|
Books of Health Club Receipt and Payment Account |
|||||||
|
Dr. |
Cr. |
||||||
|
Receipts |
Amount Rs |
Payments |
Amount Rs |
||||
|
Balance b/d |
Investment |
80,000 |
|||||
|
Cash in Hand |
5,000 |
Rent |
20,000 |
||||
|
Cash at Bank |
25,000 |
30,000 |
General Expenses |
21,500 |
|||
|
Subscriptions |
1,65,000 |
Postage and Stationery |
2,000 |
||||
|
Donations |
35,000 |
Courier Charges |
1,000 |
||||
|
Sundry Expenses |
2,500 |
||||||
|
Balance c/d |
|||||||
|
Cash in Hand |
12,000 |
||||||
|
Cast at Bank |
91,000 |
1,03,000 |
|||||
|
(Balancing figure) |
|||||||
|
2,30,000 |
2,30,000 |
||||||
Q2 :The Receipt and Payment Account of Harimohan charitable institution is given:
|
Receipt and Payment Account for the year ending March 31, 2007 |
|||
|
Receipts |
Amount Rs |
Payments |
Amount Rs |
|
Balance b/d: |
Furniture |
3,000 |
|
|
Cash at Bank |
22,000 |
Investments |
55,000 |
|
Cash in Hand |
8,800 |
Advance for building |
20,000 |
|
Donations |
32,000 |
Charities |
60,000 |
|
Subscriptions |
50,200 |
Salaries |
10,400 |
|
Endowment Fund |
60,000 |
Rent and Taxes |
4,000 |
|
Legacies |
24,000 |
Printing |
1,000 |
|
Interest on Investment |
3,800 |
Postage |
300 |
|
Interest on Deposits |
800 |
Advertisements |
1,100 |
|
Sale of old newspapers |
500 |
Insurance |
4,800 |
|
Balance c/d: |
|||
|
Cash at Bank |
32,000 |
||
|
Cash in Hand |
10,500 |
||
|
2,02,100 |
2,02,100 |
||
Prepare the Income and Expenditure Account for the Year ended on March 31, 2007 after considering the following:
(i)It was decided to treat Fifty per cent of the amount received on account of Legacies and Donations as income.
(ii)Liabilities to be provided for are:
Rent Rs 800; Salaries Rs 1,200; advertisement Rs 200.
(iii) Rs 2,000 due for interest on investment was not actually received.
Answer :
|
Books of Harimohan Charitable Institution Income and Expenditure Account |
||||||
|
Dr. |
Cr. |
|||||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
|||
|
Rent and Taxes |
4,000 |
Donations |
16,000 |
|||
|
Add: Outstanding |
800 |
4,800 |
Legacies |
12,000 |
||
|
Subscriptions |
50,200 |
|||||
|
Salaries |
10,400 |
Interest on Investment |
3,800 |
|||
|
Add: Outstanding |
1,200 |
11,600 |
Add: Accrued Interest |
2,000 |
5,800 |
|
|
Advertisement |
1,100 |
Interest on Deposits |
800 |
|||
|
Add: Outstanding |
200 |
1,300 |
Sale of Old Newspapers |
500 |
||
|
Charities |
60,000 |
|||||
|
Printing |
1,000 |
|||||
|
Postage |
300 |
|||||
|
Insurance |
4,800 |
|||||
|
Surplus (Excess of Income over Expenditure) |
1,500 |
|||||
|
85,300 |
85,300 |
|||||
NOTE: As per the solution, Excess of Income over Expenditure is Rs 1,500; however, as per the book, it is Rs 2,500.
Q3 :From the following particulars, prepare Income and Expenditure account:
|
Details |
Amount Rs |
|
Fees collected, including Rs 80,000 on account of the previous year |
5,20,000 |
|
Fees for the year outstanding |
30,000 |
|
Salary paid, including Rs 5,000 on account of the previous year |
68,000 |
|
Salary outstanding at the end of the year |
3,000 |
|
Entertainment expenses |
8,000 |
|
Tournament expenses |
25,000 |
|
Meeting Expenses |
18,000 |
|
Traveling Expenses |
7,000 |
|
Purchase of Books and Periodicals, including Rs 31,000 for purchase of Books |
40,000 |
|
Rent |
15,000 |
|
Postage, telegrams and telephones |
6,000 |
|
Printing and Stationery |
18,000 |
|
Donations received |
25,000 |
Answer:
|
Income and Expenditure Account |
||||||
|
Dr. |
Cr. |
|||||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
|||
|
Salaries |
68,000 |
Fees Collected |
5,20,000 |
|||
|
Less: Previous year’s Outstanding |
(5,000) |
Less: Previous year’s Outstanding |
(80,000) |
|||
|
63,000 |
4,40,000 |
|||||
|
Add: Current year’s Outstanding |
3,000 |
66,000 |
Add: Current year’s Outstanding |
30,000 |
4,70,000 |
|
|
Entertainment Expenses |
8,000 |
Donations |
25,000 |
|||
|
Tournament Expenses |
25,000 |
|||||
|
Meeting Expenses |
18,000 |
|||||
|
Traveling Expenses |
7,000 |
|||||
|
Purchases of Periodicals (40,000 – 31,000) |
9,000 |
|||||
|
Postage, Telegrams and Telephone’s |
6,000 |
|||||
|
Rent |
15.000 |
|||||
|
Printing and Stationery |
18,000 |
|||||
|
Surplus (Excess of Income over Expenditure) |
3,23,000 |
|||||
|
4,95,000 |
4,95,000 |
|||||
NOTE: As per the solution, Excess of Income over Expenditure is Rs 3,23,000 however, as per the book, it is Rs 3,07,000.
Q4 :Following is the information given in respect of certain items of a Sports Club. Show these items in the Income and Expenditure Account and the Balance Sheet of the Club:
|
Particulars |
Rs |
|
Sports Fund as on 1.4.2005 |
35,000 |
|
Sports Fund Investments |
35,000 |
|
Interest on Sports Fund |
4,000 |
|
Donations for Sports Fund |
15,000 |
|
Sports Prizes awarded |
10,000 |
|
Expenses on Sports Events |
4,000 |
|
General Fund |
80,000 |
|
General Fund Investments |
80,000 |
|
Interest on General Fund Investments |
8,000 |
Answer:
|
Books of Sports Club Income and Expenditure Account |
|||
|
Dr. |
Cr. |
||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
|
Interest on General Fund Investments |
8,000 |
||
|
Balance Sheet |
||||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
|
Sports Fund |
35,000 |
Sports Fund Investments |
35,000 |
|
|
Add: Interest on Sports Fund |
4,000 |
General Fund Investments |
80,000 |
|
|
Add: Donations for Sports Fund |
15,000 |
|||
|
54,000 |
||||
|
Less: Expenses on Sports Event |
(4,000) |
|||
|
Less: Prize Awarded |
(10,000) |
40,000 |
||
|
General Fund |
80,000 |
|||
Q5 : How will you deal with the following items while preparing for the Bombay Women Cricket Club its income and expenditure account for the year ending 31.3.2007 and its Balance Sheet as on 31.3.2013:
Answer:
|
Rs |
||
|
(a) |
Donation received during the year for the construction of a permanent Pavilion |
12,25,000 |
|
Expenditure incurred up to 31.3.2013 on its construction |
10,80,000 |
|
|
The total estimated expenditure on construction of Pavilion being |
25,00,000 |
|
|
(b) |
Tournament Fund: |
|
|
Balance as on 1.4.2012 |
10,700 |
|
|
Subscriptions for tournament received during the year |
65,800 |
|
|
Expenditure incurred during the year on conducting tournaments |
72,400 |
|
|
(c) |
Life Membership fee received during the year |
28,000 |
Give reasons for your answers
|
Books of Bombay Women Cricket Club Balance Sheet as on March 31, 2013 |
||||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
|
Donation for Pavilion |
12,25,000 |
Construction of Pavilion in Progress |
10,80,000 |
|
|
Less: Exp. on construction of Pavilion |
(10,80,000) |
1,45,000 |
||
|
Capital |
||||
|
Add: Pavilion Construction |
10,80,000 |
10,80,000 |
||
Reason
Donation for construction of Pavilion is a donation for specific purpose
Expenses on construction on Pavilion is a capital expenditure.
|
Balance Sheet as on March 31, 2013 |
||||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
|
Tournament Fund |
10,700 |
|||
|
Add: Subscription for Tournament |
65,800 |
|||
|
76,500 |
||||
|
Less: Tournament Expenses |
(72,400) |
4,100 |
||
Reason
|
Balance Sheet as on March 31, 2013 |
|||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Life Membership Fees |
28,000 |
||
Reason
Life Membership Fees are considered as capital receipts and are shown on the Liabilities side of the Balance Sheet, if nothing is specified about its treatment. But if it is to be treated as revenue item, then it is shown on the credit side of the Income and Expenditure Account.
Q6 : From the following receipts and payments and information given below, Prepare Income and Expenditure Account and opening Balance Sheet of Adult Literacy Organisation as on December 31, 2013.
|
Receipt and Payment Account for the year ending as on December 31, 2006* |
||||
|
Receipts |
Amount Rs |
Payments |
Amount Rs |
|
|
Balance b/d |
General Expenses |
3,200 |
||
|
Cash in hand |
4,000 |
News paper |
1,850 |
|
|
Cash at Bank |
15,550 |
Electricity |
3,000 |
|
|
Subscriptions |
Fixed deposit with bank (on 31.06.2006*) @ 10% p.a. |
18,000 |
||
|
2005* |
1,200 |
|||
|
2006* |
26,500 |
Books |
7,000 |
|
|
2007* |
500 |
28,200 |
Salary |
3,600 |
|
Sale of old newspapers |
1,250 |
Rent |
6,500 |
|
|
Govt. grant |
12,000 |
Postage charges |
300 |
|
|
Sale of old furniture (book value Rs 5, 000) |
3,700 |
Furniture (purchased) |
10,500 |
|
|
Interest received on FD |
450 |
Balance c/d |
||
|
Cash in Hand |
3,000 |
|||
|
Cash at Bank |
8,200 |
|||
|
65,150 |
65,150 |
|||
Information:
(i) Subscription outstanding as on 31.12.2005 Rs 2,000 and on December 31, 2006 Rs 1,500.
(ii) On December 31, 2006 Salary outstanding Rs 600, and one month Rent paid in advance.
(iii) On Jan. 01, 2005 organisation owned Furniture Rs 12,000, Books Rs 5,000.
Answer :
|
Books of Adult Literacy Organisation Income and Expenditure Account as on Dec. 31, 2013 |
||||||
|
Dr. |
Cr. |
|||||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
|||
|
Loss on Sale of Old Furniture |
1,300 |
Subscription |
26,500 |
|||
|
General Expenses |
3,200 |
Add: Outstanding for 2013 |
1,500 |
28,000 |
||
|
Newspapers |
1,850 |
|||||
|
Electricity |
3,000 |
Sale of Old Newspapers |
1,250 |
|||
|
Salary |
3,600 |
Government Grant |
12,000 |
|||
|
Add: Outstanding for 2013 |
600 |
4,200 |
Interest received on F.D. |
450 |
||
|
Add: Accrued Interest |
450 |
900 |
||||
|
Rent |
6,500 |
|||||
|
Less: Prepaid for 2014 {6,500×(1/13)} |
(500) |
6,000 |
||||
|
Postages Charges |
300 |
|||||
|
Surplus (Excess of Income over Expenditure) |
22,300 |
|||||
|
42,150 |
42,150 |
|||||
|
Balance Sheet as on Dec. 31, 2012 |
|||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Capital Fund on Dec. 31, 2012 (Balancing Figure) |
38,550 |
Subscription Outstanding |
2,000 |
|
Cash in Hand |
4,000 |
||
|
Cash at Bank |
15,550 |
||
|
Furniture |
12,000 |
||
|
Books |
5,000 |
||
|
38,550 |
38,550 |
||
|
Balance Sheet as on Dec. 31, 2013 |
|||||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
||
|
Capital |
38,550 |
Prepaid Rent |
500 |
||
|
Add: Surplus |
22,300 |
60,850 |
Books |
5,000 |
|
|
Add: Purchases |
7,000 |
12,000 |
|||
|
Salary Outstanding |
600 |
||||
|
Subscription Received in Advance for 2014 |
500 |
Furniture |
12,000 |
||
|
Add: Purchases |
10,500 |
||||
|
22,500 |
|||||
|
Less: Sale |
(5,000) |
17,500 |
|||
|
Fixed Deposit |
18,000 |
||||
|
Add: Accrued Interest |
450 |
18,450 |
|||
|
Cash in Hand |
3,000 |
||||
|
Cash at Bank |
8,200 |
||||
|
Subscription Outstanding for 2013 |
1,500 |
||||
|
Add: Outstanding for 2012 |
800 |
2,300 |
|||
|
61,950 |
61,950 |
||||
NOTE: In order to match the answer with the book, Adjustment (i) – Subscription outstanding on 31.12.2012 Rs 2,000 has been taken as Subscription outstanding for 31.12.2012 Rs 2,000 and Subscription outstanding on December 31, 2013 Rs 1,500 has been taken as Subscription outstanding for December 31, 2013 Rs 1,500.
Q7 : The following is the account of cash transactions of the Nari Kalayan Samittee for the year ended December 31, 2013:
|
Receipts |
Amount Rs |
Payments |
Amount Rs |
|
Balance from last year |
2,270 |
Rent |
6,600 |
|
Subscriptions |
32,500 |
Electric charges |
3,200 |
|
Life membership fee |
3,250 |
Lecturer’s fee |
730 |
|
Donation |
2,500 |
Office expenses |
1,480 |
|
Profit from entertainment |
7,250 |
Printing and Stationery |
1,050 |
|
Sale of old Books (books value Rs 1,000) |
750 |
Legal fee |
1,870 |
|
Interest |
350 |
Books |
6,500 |
|
Furniture purchased |
8,600 |
||
|
Expenses on nukar drama |
1,300 |
||
|
Cash in hand |
8,040 |
||
|
Cash at bank |
9,500 |
||
|
48,870 |
48,870 |
||
You are required to prepare an Income and Expenditure Account after the following adjustments:
(a) Subscription still to be received are Rs 750, but subscription include Rs 500 for the year 2007.
(b) In the beginning of the year the Sangh owned building Rs 20,000 and furniture Rs 3,000 and Books Rs 2,000.
(c) Provide depreciation on furniture @ 5% (including purchase), books @ 10% and building @ 5%.
Answer :
|
Books of Nari Kalyan Samittee Income and Expenditure Account as on Dec. 31, 2013 |
|||||
|
Dr. |
Cr. |
||||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
||
|
Rent |
6,600 |
Subscription |
32,500 |
||
|
Electric Charges |
3,200 |
Add: Outstanding for 2013 |
750 |
||
|
Lecturer’s fee |
730 |
33,250 |
|||
|
Office Expenses |
1,480 |
Less: Advance for 2014 |
(500) |
32,750 |
|
|
Printing and Stationery |
1,050 |
Donation |
2,500 |
||
|
Legal Fee |
1,870 |
Profit from Entertainment |
7,250 |
||
|
Depreciation on: |
Interest |
350 |
|||
|
Books |
750 |
||||
|
Furniture |
580 |
||||
|
Building |
1,000 |
2,330 |
|||
|
Expenses on Nukar Drama |
1,300 |
||||
|
Loss on Sale of Books |
250 |
||||
|
Surplus |
24,040 |
||||
|
42,850 |
42,850 |
||||
|
Balance Sheet as on Dec. 31, 2012 |
|||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Capital Fund as Dec. 31, 2012 |
27,270 |
Building |
20,000 |
|
(Balancing Figure) |
Furniture |
3,000 |
|
|
Books |
2,000 |
||
|
Cash and Bank |
2,270 |
||
|
27,270 |
27,270 |
||
|
Balance Sheet as on Dec. 31, 2013 |
||||||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|||
|
Capital Fund |
27,270 |
Building |
20,000 |
|||
|
Add: Life Membership Fees |
3,250 |
Less: 5% Depreciation |
(1,000) |
19,000 |
||
|
Add: Surplus |
24,040 |
54,560 |
||||
|
Furniture |
3,000 |
|||||
|
Advance Subscription for 2014 |
500 |
Add: Purchases |
8,600 |
|||
|
11,600 |
||||||
|
Less: 5% Depreciation |
580 |
11,020 |
||||
|
Books |
2,000 |
|||||
|
Add: Purchases |
6,500 |
|||||
|
8,500 |
||||||
|
Less: Sales |
1,000 |
|||||
|
7,500 |
||||||
|
Less: 5% Depreciation |
750 |
6,750 |
||||
|
Cash in Hand |
8,040 |
|||||
|
Cash at Bank |
9,500 |
|||||
|
Subscription Outstanding |
750 |
|||||
|
55,060 |
55,060 |
|||||
Q8 : Following is the Receipt and Payment Account of Indian Sports Club, prepared Income and Expenditure Account, Balance Sheet as on December 31, 2013:
|
Receipt and Payment Account for the year ending December 31, 2013 |
|||
|
Receipts |
Amount Rs |
Payments |
Amount Rs |
|
Balance b/d |
7,890 |
Salary |
11,000 |
|
Subscriptions |
52,000 |
Electric charges |
5,500 |
|
Life member ship fee |
2,200 |
Billiard Table |
17,500 |
|
Entrance fee |
3,200 |
Office expenses |
4,100 |
|
Tournament fund |
26,000 |
Printing and Stationery |
2,300 |
|
Locker Rent |
1,250 |
Tournament expenses |
18,500 |
|
Sale of old sports goods (Costing Rs 2,200) |
2,500 |
Repair of ground |
2,000 |
|
Sale of Old Newspaper |
750 |
Furniture purchased |
7,700 |
|
Legacy |
37,500 |
Sports equipments |
12,000 |
|
Cash in Hand |
12,690 |
||
|
Cash at Bank |
10,000 |
||
|
Fixed Deposit (on 1.10.06* for 10% p.a) |
30,000 |
||
|
1,33,290 |
1,33,290 |
||
Other Information:
Subscription outstanding was on December 31, 2012 Rs 1,200 and Rs 3,200 on December 31, 2013. Locker rent outstanding on December 31, 2013 Rs 250. Salary outstanding on December 31, 2013 Rs 1,000.
On January 1, 2013, club has Building Rs 36,000, furniture Rs 12,000, Sports equipments Rs 17,500. Depreciation charged on these items @ 10% (including Purchase).
* As per the question, the year should be 2013, i.e. 1.10.13
Answer:
|
Indian Sports Club Income and Expenditure Account as on Dec. 31, 2013 |
|||||
|
Dr. |
Cr. |
||||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
||
|
Salary |
11,000 |
Subscriptions |
52,000 |
||
|
Add: Outstanding for 2013 |
1,000 |
12,000 |
Add: Outstanding for 2013 |
3,200 |
|
|
Electric Charges |
5,500 |
55,200 |
|||
|
Office Expenses |
4,100 |
Less: Outstanding for 2012 |
(1,200) |
54,000 |
|
|
Printing and Stationery |
2,300 |
||||
|
Repair of Ground |
2,000 |
Locker Rent |
1,250 |
||
|
Depreciation on: |
Add: Outstanding for 2013 |
250 |
1,500 |
||
|
Furniture |
1,970 |
||||
|
Building |
3,600 |
Entrance Fees |
3,200 |
||
|
Sports Equipments |
2,730 |
8,300 |
Profit on Sale of Sports |
||
|
Surplus |
26,300 |
Equipments (Rs 2,500 – Rs 2,200) |
300 |
||
|
Sale of Old Newspapers |
750 |
||||
|
Accrued Interest |
750 |
||||
|
60,500 |
60,500 |
||||
|
Balance Sheet as on January 01, 2012 |
||||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
|
Capital Fund (Balancing Figure) |
74,590 |
Subscription Outstanding |
1,200 |
|
|
Building |
36,000 |
|||
|
Furniture |
12,000 |
|||
|
Sports Equipments |
17,500 |
|||
|
Cash and Bank |
7,890 |
|||
|
74,590 |
74,590 |
|||
|
Balance Sheet as on Dec. 31, 2013 |
|||||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
||
|
Salary Outstanding |
1,000 |
Subscripting Outstanding |
3,200 |
||
|
Tournament Fund |
26,000 |
Locker Rent Outstanding |
250 |
||
|
Less: Tournament Expenses |
18,500 |
7,500 |
Building |
36,000 |
|
|
Less: 10% Depreciation |
(3,600) |
32,400 |
|||
|
Capital fund |
74,590 |
||||
|
Add: Life Membership Fee |
2,200 |
Furniture |
12,000 |
||
|
Add: Legacy |
37,500 |
Add: Purchases |
7,700 |
||
|
Add: Surplus |
26,300 |
1,40,590 |
19,700 |
||
|
Less: 10% Depreciation |
(1,970) |
17,730 |
|||
|
Sports Equipments |
17,500 |
||||
|
Add: Purchases |
12,000 |
||||
|
29,500 |
|||||
|
Less: Sales |
(2,200) |
||||
|
27,300 |
|||||
|
Less: 10% Depreciation |
(2,730) |
24,570 |
|||
|
Billiard Table |
17,500 |
||||
|
Cash in hand |
12,690 |
||||
|
Cash at Bank |
10,000 |
||||
|
Fixed Deposit |
30,000 |
||||
|
Add: Accrued Interest |
750 |
30,750 |
|||
|
1,49,090 |
1,49,090 |
||||
Q9 : From the following Receipt and Payment Account of Jan Kalyan Club, prepare Income and Expenditure Account and Balance Sheet for the year ending December 31, 2013.
|
Receipt and Payment Account for the year ending March 31, 2013 |
|||
|
Receipts |
Amount Rs |
Payments |
Amount Rs |
|
Cash in hand as on 1.4.12 |
6,800 |
Salaries |
24,000 |
|
Subscription |
60,200 |
Traveling Expenses |
6,000 |
|
Donation |
3,000 |
Stationery |
2,300 |
|
Sale of furniture (Book value Rs 6000) |
4,000 |
Rent |
16,000 |
|
Entrance fee |
800 |
Repair |
700 |
|
Life membership fee |
7,000 |
Books purchased |
6,000 |
|
Interest on investment (@ 5% for full year) |
5,000 |
Building purchased |
30,000 |
|
Cash in hand as 31.3.2013 |
1,800 |
||
|
86,800 |
86,800 |
||
Additional Information:
|
As on 1.04.2012 |
As on 31.03.2013 |
||
|
(i) |
Subscription received in advance |
1,000 |
3,200 |
|
(ii) |
Outstanding subscription |
2,000 |
3,700 |
|
(iii) |
Stock of stationery |
1,200 |
800 |
|
(iv) |
Books |
13,500 |
16,500 |
|
(v) |
Furniture |
16,000 |
8,000 |
|
(vi) |
Outstanding rent |
1,000 |
2,000 |
Answer:
|
Books of Jan Kalyan Club Income and Expenditure Account as on 31 March 2013 |
|||||
|
Dr. |
Cr. |
||||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
||
|
Loss on Sale of Furniture (Rs 6,000 – Rs 4,000) |
2,000 |
Subscription |
60,200 |
||
|
Salaries |
24,000 |
Less: Outstanding for 2012 |
(2,000) |
||
|
Traveling Expenses |
6,000 |
58,200 |
|||
|
Stationery |
2,300 |
Add: Outstanding for 2013 |
3,700 |
||
|
Add: Opening Stock |
1,200 |
61,900 |
|||
|
3,500 |
Add: Advance in 2012 |
1,000 |
|||
|
Less: Closing Stock |
(800) |
2,700 |
62,900 |
||
|
Less: Advance in 2013 |
(3,200) |
59,700 |
|||
|
Repairs |
700 |
||||
|
Rent |
16,000 |
Donation |
3,000 |
||
|
Less: Outstanding for 2012 |
(1,000) |
Entrance Fees |
800 |
||
|
15,000 |
Interest on Investments |
5,000 |
|||
|
Add: Outstanding for 2013 |
2,000 |
17,000 |
|||
|
Depreciation on Books |
3,000 |
||||
|
Depreciation on Furniture |
2,000 |
||||
|
Surplus |
11,100 |
||||
|
68,500 |
68,500 |
||||
|
Balance Sheet as on April 01, 2012 |
|||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Advance Subscription |
1,000 |
Cash in Hand |
6,800 |
|
Outstanding Rent |
1,000 |
Investment {5,000 × (100/5)} |
1,00,000 |
|
Capital Fund (Balancing figure) |
1,37,500 |
Subscription Outstanding |
2,000 |
|
Stock of Stationery |
1,200 |
||
|
Books |
13,500 |
||
|
Furniture |
16,000 |
||
|
1,39,500 |
1,39,500 |
||
|
Balance Sheet as on March 31, 2013 |
|||||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
||
|
Advance Subscription |
3,200 |
Subscription Outstanding |
3,700 |
||
|
Outstanding Rent |
2,000 |
Stock of Stationery |
800 |
||
|
Capital Fund |
1,37,500 |
Investments |
1,00,000 |
||
|
Add: Life Membership Fees |
7,000 |
||||
|
Add: Surplus |
11,100 |
1,55,600 |
Books |
13,500 |
|
|
Add: Purchases |
6,000 |
||||
|
19,500 |
|||||
|
Less: Depreciation |
(3,000) |
16,500 |
|||
|
Building |
30,000 |
||||
|
Cash in Hand |
1,800 |
||||
|
Furniture |
16,000 |
||||
|
Less: Sales |
6,000 |
||||
|
10,000 |
|||||
|
Less: Depreciation |
(2,000) |
8,000 |
|||
|
1,60,800 |
1,60,800 |
||||
Q10 : Receipt and Payment Account of Shankar Sports club is given below, for the year ended December 31, 2013
|
Receipt and Payment Account for the year ending March 31, 2013 |
|||
|
Receipts |
Amount Rs |
Payments |
Amount Rs |
|
Opening Cash in hand |
2,600 |
Rent |
18,000 |
|
Entrance fees |
3,200 |
Wages |
7,000 |
|
Donation for building |
23,000 |
Billiard table |
14,000 |
|
Locker rent |
1,200 |
Furniture |
10,000 |
|
Life membership fee |
7,000 |
Interest |
2,000 |
|
Profit from entertainment |
3,000 |
Postage |
1,000 |
|
Subscription |
40,000 |
Salary |
24,000 |
|
|
|
Cash in hand |
4,000 |
|
|
80,000 |
|
80,000 |
|
|
|
|
|
Prepare Income and Expenditure Account and Balance Sheet with help of following Information:
Subscription outstanding on March 31, 2012 is Rs 1, 200 and Rs 2,300 on March 31, 2013, opening stock of postage stamps is Rs 300 and closing stock is Rs 200, Rent Rs 1,500 related to 2005 and Rs 1,500 is still unpaid.
On April 01, 2012 the club owned furniture Rs 15,000, Furniture valued at Rs 22,500
The club took a loan of Rs 20,000 (@ 10% p.a.) in 2005*.
* As per the question, this year should be 2012.
Answer:
|
Books of Shankar Sports Club Income and Expenditure Account as on 31 Dec. 2013 |
|||||
|
Dr. |
|
|
Cr. |
||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
||
|
Rent |
18,000 |
|
Entrance Fees |
3,200 |
|
|
Add: Outstanding for 2013 |
1,500 |
|
Locker Rent |
1,200 |
|
|
|
19,500 |
|
Profit from Entertainment |
3,000 |
|
|
Less: Outstanding for 2012 |
(1,500) |
18,000 |
|
|
|
|
|
|
Subscription |
40,000 |
|
|
|
Wages |
7,000 |
Less: Outstanding for 2012 |
(1,200) |
|
|
|
Depreciation on Furniture |
2,500 |
|
38,800 |
|
|
|
Interest |
2,000 |
Add: Outstanding for 2013 |
2,300 |
41,100 |
|
|
Postage |
1,000 |
|
Deficit (Balancing Figure) |
6,100 |
|
|
Add: Opening Stock |
300 |
|
|
|
|
|
|
1,300 |
|
|
|
|
|
Less: Closing Stock |
(200) |
1,100 |
|
|
|
|
Salaries |
24,000 |
|
|
||
|
|
|
|
|
||
|
|
54,600 |
|
54,600 |
||
|
|
|
|
|
||
|
Balance Sheet as on December 31, 2012 |
|||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Rent Outstanding |
1,500 |
Cash in Hand |
2,600 |
|
10% Loan |
20,000 |
Subscription Outstanding |
1,200 |
|
|
|
Furniture |
15,000 |
|
|
|
Stock of Postage Stamps |
300 |
|
|
|
Capital fund Deficit (Balancing figure) |
2,400 |
|
|
|
|
|
|
|
21,500 |
|
21,500 |
|
|
|
|
|
|
Balance Sheet as on December 31, 2013 |
||||||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
|||
|
Rent Outstanding |
1,500 |
Subscription Outstanding |
2,300 |
|||
|
10% Loan |
20,000 |
Stock of Postage Stamps |
200 |
|||
|
Donation for Building |
23,000 |
Billiard Table |
14,000 |
|||
|
Capital Fund |
(2,400) |
|
Furniture |
15,000 |
|
|
|
Add: Life Membership Fee |
7,000 |
|
Add: Purchases |
10,000 |
|
|
|
Less: Deficit |
(6,100) |
|
|
|
25,000 |
|
|
|
|
Less: Depreciation |
(2,500) |
22,500 |
||
|
|
|
Cash in Hand |
4,000 |
|||
|
|
|
** Capital Fund (Deficit) |
1500 |
|||
|
|
44,500 |
|
44,500 |
|||
|
|
|
|
|
|||
NOTE 1: As per the solution, Deficit is Rs 6,100 and the total of the Balance Sheet as on Dec. 31, 2013 is Rs 44,500. However, as per the book, Deficit is Rs 8,100 and the total of the Balance Sheet as on Dec. 31, 2013 is Rs 53,500.
** NOTE 2:
|
Capital Fund |
(2,400) |
|
|
|
Add: |
Life Membership Fees |
7,000 |
|
|
Less: |
Deficit |
(6,100) |
|
|
|
Net Deficit |
(1,500) |
|
Q11 : Prepare Income and Expenditure Account and Balance Sheet for the year ended December 31, 2006 from the following Receipt and Payment Account and Balance Sheet of culture club:
|
Receipt and Payment Account for the year ending March 31, 2013 |
||||
|
Receipts |
Amount Rs |
Payments |
Amount Rs |
|
|
Opening cash balance |
|
12,000 |
Furniture |
4,000 |
|
Subscription |
|
|
Telephone expenses |
800 |
|
2011-2012 |
2,000 |
|
Salary |
|
|
2012-2013 |
22,000 |
24,000 |
2011-2012 |
1,000 |
|
Entrance fees |
|
2,800 |
2012-2013 |
4,000 |
|
Locker rent |
|
1,000 |
Newspapers |
700 |
|
Life membership fee |
|
1,200 |
Sundry expenses |
1,000 |
|
Government grant |
|
11,000 |
Defence bonds |
18,000 |
|
|
|
|
Land |
20,000 |
|
|
|
|
Closing cash balance |
2,500 |
|
|
|
52,000 |
|
52,000 |
|
|
|
|
|
|
|
Balance Sheet for the year ending March 31, 2012 |
|||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Advance locker rent |
200 |
Cash in hand |
12,000 |
|
Subscription Received in Advance |
1,000 |
Outstanding Expenses |
3,000 |
|
Outstanding salary |
2,000 |
Building |
35,000 |
|
Loan |
10,000 |
|
|
|
Capital fund |
36,800 |
|
|
|
|
50,000 |
|
50,000 |
|
|
|
|
|
Answer:
|
Books of Culture Club Income and Expenditure Account as on March 31, 2013 |
|||||||
|
Dr. |
|
Cr. |
|||||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
||||
|
Telephone Expenses |
800 |
Subscription |
22,000 |
|
|||
|
Salary |
4,000 |
Add: Advance Received in 2012 |
1,000 |
23,000 |
|||
|
Newspapers |
700 |
|
|
||||
|
Sundry Expenses |
1,000 |
Entrance Fees |
2,800 |
||||
|
|
|
Locker Rent |
1,000 |
|
|||
|
Surplus (Balancing figure) |
31,500 |
Add: Advance Received in 2012 |
200 |
1,200 |
|||
|
|
|
Government Grants |
11,000 |
||||
|
|
|
|
|
||||
|
|
38,000 |
|
38,000 |
||||
|
|
|
|
|
||||
|
Balance Sheet as on March 31, 2013 |
||||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
|
Capital Fund |
36,800 |
|
Subscription Still Outstanding for 2012 |
1,000 |
|
Add: Life Membership Fees |
1,200 |
|
(Rs 3,000 – Rs 2,000) |
|
|
Add: Surplus |
31,500 |
69,500 |
Furniture |
4,000 |
|
|
|
Defence Bonds |
18,000 |
|
|
Salary Still Outstanding for 2005 |
1,000 |
Land |
20,000 |
|
|
Loan |
10,000 |
Building |
35,000 |
|
|
|
|
Cash in Hand |
2,500 |
|
|
|
80,500 |
|
80,500 |
|
|
|
|
|
|
|
Q12 : From the following Receipt and Payment Account prepare final accounts of a Unity Club for the year ended March 31, 2013.
|
Receipt and Payment Accounts for the year ending March 31, 2013 |
||||
|
Receipts |
Amount Rs |
Payments |
Amount Rs |
|
|
Balance b/d |
|
15,000 |
Furniture |
18,000 |
|
Sale of Old furniture (costing Rs 6,000) |
4,000 |
Library books |
10,000 |
|
|
Subscriptions: |
|
|
Salaries |
72,000 |
|
2012–13 |
18,000 |
|
General expenses |
18,000 |
|
2013–14 |
60,000 |
|
Electric charges |
12,000 |
|
2014–15 |
12,000 |
90,000 |
Newspapers |
33,800 |
|
Sale of old newspapers |
|
10,800 |
Postage |
3,000 |
|
Profit from entertainment |
|
44,000 |
Stationery |
40,000 |
|
Rent |
|
84,000 |
Audit fee |
8,000 |
|
|
|
|
Balance c/d |
33,000 |
|
|
|
2,47,800 |
|
2,47,800 |
|
|
|
|
|
|
|
Balance Sheet as on March 31, 2012 |
|||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Outstanding Salary |
6,000 |
Cash |
15,000 |
|
Capital Fund |
6,94,000 |
Outstanding subscription |
18,000 |
|
|
|
Library Books |
30,000 |
|
|
|
Furniture |
37,000 |
|
|
|
Land and Building |
6,00,000 |
|
|
7,00,000 |
|
7,00,000 |
|
|
|
|
|
Additional Information:
1.The Club had 500 members each paying an annual subscription of Rs 150.
2.On 31.3.2013 salaries outstanding amounted to Rs 1,200 and salaries paid included Rs 6,000 for the year 2011-12.
3.Provide 5% depreciation on Land and Building.
Answer:
|
Books of Unity Club Income and Expenditure Account as on March 31, 2013 |
||||||
|
Dr. |
|
Cr. |
||||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
|||
|
Loss on Sale of Old Furniture (4,000 – 6,000) |
2,000 |
Subscription |
|
|||
|
|
|
500 members at Rs 150 each |
75,000 |
|||
|
Salaries |
72,000 |
|
Sale of Old Newspapers |
10,800 |
||
|
Add: Outstanding for 2012–13 |
1,200 |
|
Profit from Entertainment |
44,000 |
||
|
|
73,200 |
|
Rent |
84,000 |
||
|
Less: Outstanding for 2011–12 |
(6,000) |
67,200 |
|
|
||
|
General Expenses |
18,000 |
Deficit (Balancing figure) |
200 |
|||
|
Electric Charges |
12,000 |
|
|
|||
|
Newspapers |
33,800 |
|
|
|||
|
Postage |
3,000 |
|
|
|||
|
Stationery |
40,000 |
|
|
|||
|
Audit Fees |
8,000 |
|
|
|||
|
Depreciation on Land and Building |
30,000 |
|
|
|||
|
|
2,14,000 |
|
2,14,000 |
|||
|
|
|
|
|
|||
|
Balance Sheet as on 31 March 2013 |
|||||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
||
|
Advance Subscription (for 2014–15) |
12,000 |
Subscription Outstanding |
15,000 |
||
|
Salaries Outstanding |
1,200 |
Furniture |
37,000 |
|
|
|
Capital Fund |
6,94,000 |
|
Add: Purchases |
18,000 |
|
|
Less: Deficit |
(200) |
6,93,800 |
|
55,000 |
|
|
|
|
|
Less: Sales |
(6,000) |
49,000 |
|
|
|
|
|
|
|
|
|
|
Library Books |
30,000 |
|
|
|
|
|
Add: Purchases |
10,000 |
40,000 |
|
|
|
|
|
|
|
|
|
|
|
Land and Building |
6,00,000 |
|
|
|
|
|
Less: 5% Depreciation |
(30,000) |
5,70,000 |
|
|
|
|
|
|
||
|
|
|
Cash and Bank |
33,000 |
||
|
|
7,07,000 |
|
7,07,000 |
||
|
|
|
|
|
||
As per the solution, Deficit is Rs 200 and the total of the Balance Sheet as on March 31, 2013 is Rs 7,07,000. However, the Surplus given in the book is Rs 14,000 and the total of the Balance Sheet as on March 31, 2013 is Rs 7,27,000
Q13 : Following is the information in respect of certain items of a Sports Club. You are required to show them in the Income and Expenditure Account and the Balance Sheet.
|
Details |
Amount Rs |
|
Sports Fund as on April 1, 2005 |
80,000 |
|
Sports Fund Investments |
80,000 |
|
Interest on Sports Fund Investments |
8,000 |
|
Donations for Sports Fund |
30,000 |
|
Sports Prizes awarded |
16,000 |
|
Expenses on Sports Events |
7,000 |
|
General Fund |
2,00,000 |
|
General Fund Investments |
2,00,000 |
|
Interest on General Fund Investments |
20,000 |
Answer:
|
Income and Expenditure Account as on March 31, 2014 |
|||||
|
Dr. |
Cr. |
||||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
||
|
Interest on General Fund Investments |
20,000 |
||||
|
Balance Sheet as on March 31, 2014 |
||||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
|
Sports Fund |
80,000 |
Sports Fund Investments |
80,000 |
|
|
Add: Interest on Sports Fund |
General Fund Investments |
2,00,000 |
||
|
Investments |
8,000 |
|||
|
Add: Donation for Sports Fund |
30,000 |
|||
|
1,18,000 |
||||
|
Less: Sports Prizes Awarded |
(16,000) |
|||
|
Less: Expenses on Sports Events |
(7,000) |
95,000 |
||
|
General Fund |
2,00,000 |
|||
Q14 : Receipt and Payment Account of Maitrey Sports Club showed that Rs 68,500 were received by way of subscriptions for the year ended on March 31, 2014.
The additional information was as under:
1. Subscription Outstanding as on March 31, 2005 were Rs 6,500,
2. Subscription received in advance as on March 31, 2005 were Rs 4,100,
3. Subscription Outstanding as on March 31, 2006 were Rs 5,400,
4. Subscription received in advance as on March 31, 2006 were Rs 2,500.Show how that above information would appear in the final accounts for the year ended on March 31, 2014 of Maitrey Sports Club.
Answer :
|
Books of Maitrey Sports Club Income and Expenditure Account as on March 31, 2014 |
||||||
|
Dr. |
Cr. |
|||||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
|||
|
Subscription |
68,500 |
|||||
|
Less: O/s on Mar. 31, 2013 |
(6,500) |
|||||
|
62,000 |
||||||
|
Add: Advance on Mar. 31, 2013 |
4,100 |
|||||
|
Add: O/s on Mar. 31, 2014 |
5,400 |
|||||
|
71,500 |
||||||
|
Less: Advance on Mar. 31, 2014 |
(2,500) |
69,000 |
||||
|
Balance Sheet as on March 31, 2013 |
|||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Subscription in Advance |
4,100 |
Subscription Outstanding |
6,500 |
|
Balance Sheet as on March 31, 2014 |
|||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Subscription in Advance |
2,500 |
Subscription Outstanding |
5,400 |
Q15 : Following is the Receipt and Payment account of Rohatgi Trust :
|
Receipt and Payment Account for the year ending December 31, 2013 |
||||
|
Receipts |
Amount Rs |
Payments |
Amount Rs |
|
|
Cash in hand |
14,000 |
Rent |
6,000 |
|
|
Cash at Bank |
60,000 |
Salary |
12,000 |
|
|
Subscriptions: 2012 2013 2014 |
5,000 83,000 3,000 |
91,000 |
Postage Electricity charges Purchase of furniture Books |
300 6,000 20,000 3,000 |
|
Sale of Investment |
90,000 |
Defence Bonds |
1,50,000 |
|
|
Interest on investment |
2,000 |
Help to needy students |
22,000 |
|
|
Sale of furniture (book value Rs 3,000) |
3,200 |
Cash in hand Cash at bank |
10,900 30,000 |
|
|
2,60,200 |
2,60,200 |
|||
repare Income and expenditure account for the year ended December 31, 2013, and a balance sheet as on that date after the following adjustments: Subscription for 2013, still owing were Rs 7,000. Interest due on defence bonds was Rs7,000, Rent still owing was Rs 1,000. The Book value of investment sold was Rs 80,000, Rs 30,000 of the investment were still in hand. Subscription received in 2013 included Rs 400 from a life member. The total furniture on January 1, 2013 was worth Rs 12,000. Salary paid for the year 2014 is Rs 2,000.
Answer:
|
Books of Rohatgi Trust Income and Expenditure Account as on December 31, 2013 |
|||||||
|
Dr. |
Cr. |
||||||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
||||
|
Rent |
6,000 |
Subscription |
83,000 |
||||
|
Add: Outstanding |
1,000 |
7,000 |
Add: Outstanding for 2013 |
7,000 |
|||
|
90,000 |
|||||||
|
Salary |
12,000 |
Less: Life Membership Fees |
(400) |
89,600 |
|||
|
Less: Advance for 2014 |
(2,000) |
10,000 |
|||||
|
Interest Accrued on Defence Bonds |
7,000 |
||||||
|
Postage |
300 |
Profit on Sale of Investment (Rs 90,000 – Rs 80,000) |
10,000 |
||||
|
Electricity Charges |
6,000 |
Profit on Sale of Furniture (Rs 3,200 – Rs 3,000) |
200 |
||||
|
Help to Needy Students |
22,000 |
Interest on Investments |
2,000 |
||||
|
Surplus (Balancing Figure) |
63,500 |
||||||
|
1,08,800 |
1,08,800 |
||||||
|
Balance Sheet as on December 31, 2012 |
|||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Capital fund (Balancing Figure) |
2,01,000 |
Subscription Outstanding |
5,000 |
|
Investment (Rs 80,000 + Rs 30,000) |
1,10,000 |
||
|
Furniture |
12,000 |
||
|
Cash in hand |
14,000 |
||
|
Cash at bank |
60,000 |
||
|
2,01,000 |
2,01,000 |
||
|
Balance Sheet as on December 31, 2013 |
||||||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
|||
|
Advance Subscription |
3,000 |
Subscription Outstanding |
7,000 |
|||
|
Rent Outstanding |
1,000 |
Defence Bonds |
1,50,000 |
|||
|
Capital Fund |
2,01,000 |
Add: Accrued Interest on Defence Bonds |
7,000 |
1,57,000 |
||
|
Add: Surplus |
63,500 |
|||||
|
Add: Life Membership Fees |
400 |
2,64,900 |
Investment |
30,000 |
||
|
Advance Salaries |
2,000 |
|||||
|
Furniture |
12,000 |
|||||
|
Add: Purchases |
20,000 |
|||||
|
32,000 |
||||||
|
Less: Sales |
(3,000) |
29,000 |
||||
|
Books |
3,000 |
|||||
|
Cash in Hand |
10,900 |
|||||
|
Cash at Bank |
30,000 |
|||||
|
2,68,900 |
2,68,900 |
|||||
NOTE: As per the solution, Surplus is Rs 63,500; however, as per the book, the Surplus is Rs 59,900.
Q16 : Following Receipt and Payment Account was prepared from the cash book of Delhi Charitable Trust for the year ending December 31, 2013.
|
Receipt and Payment Account for the year ending December 31, 2013 |
|||
|
Receipts |
Amount Rs |
Payments |
Amount Rs |
|
Balance b/d |
Charity |
11,500 |
|
|
Cash in hand |
11,500 |
Rent and taxes |
3,200 |
|
Cash at bank |
12,600 |
Salary |
6,000 |
|
Donation |
9,000 |
Printing |
600 |
|
Subscription |
42,800 |
Postage |
300 |
|
Legacies |
18,000 |
Advertisements |
4,500 |
|
Interest on investment |
4,500 |
Insurances |
2,000 |
|
Sale of old newspapers |
200 |
Furniture |
21,600 |
|
Investment |
23,000 |
||
|
Balance c/d: |
|||
|
Cash in hand |
9,900 |
||
|
Cash at bank |
16,000 |
||
|
98,600 |
98,600 |
||
Prepare Income and expenditure account for the year ended December 31, 2012, and a balance sheet as on that date after the following adjustments:
(a)It was decided to treat one-third of the amount received on account of donation as income.
(b)Insurance premium was paid in advance for three months.
(c)Interest on investment Rs1,100 accrued was not received.
(d)Rent Rs600: salary Rs900 and advertisement expenses Rs1,000 outstanding as on December 31, 2013.
* As per the question, this year should be 2013 as Receipt and Payment Account is provided for the year ending December 31, 2013.
Answer:
|
Books of Delhi Charitable Trust Income and Expenditure Account as on December 31, 2013 |
||||||
|
Dr. |
Cr. |
|||||
|
Expenditure |
Amount Rs |
Income |
Amount Rs |
|||
|
Insurance |
2,000 |
Donation {9,000 × (1/3)} |
3,000 |
|||
|
Less: Prepaid {2,000 × (3/15)} |
(400) |
1,600 |
Interest on Investments |
4,500 |
||
|
Add: Accrued Interest |
1,100 |
5,600 |
||||
|
Charity |
11,500 |
|||||
|
Rent and Taxes |
3,200 |
Subscription |
42,800 |
|||
|
Add: Outstanding |
600 |
3,800 |
Sale of Old Newspapers |
200 |
||
|
Salary |
6,000 |
|||||
|
Add: Outstanding |
900 |
6,900 |
||||
|
Printing |
600 |
|||||
|
Postage |
300 |
|||||
|
Advertisements |
4,500 |
|||||
|
Add: Outstanding |
1,000 |
5,500 |
||||
|
Surplus (Balancing figure) |
21,400 |
|||||
|
51,600 |
51,600 |
|||||
|
Balance Sheet as on December 31, 2012 |
|||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
|
Capital Fund (Balancing figure) |
24,100 |
Cash in Hand |
11,500 |
|
Cash at Bank |
12,600 |
||
|
24,100 |
24,100 |
||
|
Balance Sheet as on December 31, 2013 |
|||||
|
Liabilities |
Amount Rs |
Assets |
Amount Rs |
||
|
Capital Fund |
24,100 |
Prepaid Insurance {2,000 × (3/15)} |
400 |
||
|
Add: Donation {9,000 × (2/3) |
6,000 |
Investment |
23,000 |
||
|
Add: Legacies |
18,000 |
Add: Accrued Interest |
1,100 |
24,100 |
|
|
Add: Surplus |
21,400 |
69,500 |
Furniture |
||