ACCOUNTING FOR N.P.

QUESTION 1

The receipts and payments for the Swaraj Club for the year ended March 31, 2016
were: Entrance fees Rs.300; Membership Fees Rs.3,000; Donation for Club Pavilion
Rs.10,000, Foodstuff sales Rs.1,200; Salaries and Wages Rs.1,200 Purchase of
Foodstuff Rs. 800; Construction of Club Pavilion Rs.11,000; General Expenses Rs.600;
Rent and Taxes Rs.400; Bank Charges Rs.160.

Cash in hand– April.1st Rs.200, March. 31st Rs.350

Cash in Bank– April. 1st Rs.400; March. 31st Rs.590
You are required to prepare Receipts and Payment Account.
Swaraj Club

Receipts and Payments Accounts

for the year ended 31st March, 2016

Receipts Rs. Payments Rs.

To Balance b/d(opening By Salaries and Wages 1,200
bal.)
Cash in hand 200
To Cash with bank 400 By Purchase of Foodstuff 800
To Entrance Fees 300 By Club Pavilion
To Membership Fees 3,000 11,000
(Expenditure on its
To Donation of Account 600
By construction)
of Club Pavilion 10,000 400
By General Expenses
To Sales of foodstuff 1,200 160
By Rent and
By Taxes Bank 350
590
Charges
15,100 15,100
Balance c/d (closing bal)

Cash in hand
Cash in bank
QUESTION 2
During 2016, subscription received in cash is Rs.42,000. It includes Rs.1,600 for 2015
and Rs.600 for 2017. Also Rs.3,000 has still to be received for 2016.

Required

Calculate the amount to be credited to Income and Expenditure Account in respect

of subscription.

SOLUTION

Rs.

Amount received 42,000

Add : Outstanding on 31st Dec., 2016 3,000
45,000
Less : Received on account of 2015 1,600
2017 600 (2,200)
42,800
Amount received 42,000
Add : Outstanding on 31st Dec., 2016 3,000
45,000
Less : Received on account of 2015 1,600
2017 600 (2,200)
42,800

QUESTION 3

From the following extracts of Receipts & Payments Account and the additional
information, you are required to calculate the Income from Subscriptions for the
year ending March 31, 2018 and show them in the Income & Expenditure Account,
and the Balance Sheet of a Club.
 AN EXTRACT OF RECEIPTS & PAYMENTS ACCOUNT
Dr. for the year ended 31st March, 2018 Cr.

Receipts Rs. Payments Rs.

To Subscription

2016-2017 5,000

2017-2018 30,000

2018-2019 6,000 41,000

Information:

(a) Subscription outstanding on 31.3,2017 Rs.

6,000

(b) Subscription outstanding on 31.3,2018 Rs.

5,000

(c) Subscription received-in-advance on 31.3,2017 Rs.

6,000

SOLUTION
AN EXTRACT OF INCOME AND EXPENDITURE ACCOUNT
Dr. for the year ended 31st March, 2018 Cr.

Expenditure Rs. Income Rs.

By Subscription 40,000

AN EXTRACT OF BALANCE SHEET

for the year ended 31st March, 2018

Liabilities Rs. Assets Rs.

Subscription in advance 6,000 Subscription Outstanding

for 2016-2017 (6000 - 1,000

5000)

for 2017-2018 (5000- 4,000 5,000

1000)
Working
Working Note:
CALCULATION OF SUBSCRIPTION INCOME FOR 2017-
2017-2018

A. Subscription received during 2017-2018 for 2017-2018 Rs.

30,000

B. Subscription received during 2016-2017 for 2017-2018 Rs.

6,000

C. Subscription outstanding for 2017-2018 as at 31.3,2018 Rs.

4,000

Rs.
40,000

QUESTION 4
How will you deal with the following items while preparing the Income and
Expenditure Account for the year ending on 31st March, 2018 and the Balance
Sheet as on that date’?
Subscription outstanding as on 31.3,2017: Rs. 9,500 (including Rs. 500 for
2015-2016)
Subscription received in advance as on 31.3,2017: Rs. 3,000 (including Rs. 200
for 2018-2019)
Subscription received during 2017-2018: for 2015-2016 Rs. 400, for 2016-2017
Rs. 8,900, for 2017-2018 Rs. 1,34,400, for 2018-2019 Rs. 4,000, for 2019-
2020 Rs. 1,200.
Subscription outstanding as on 31.3,2018: Rs. 7,000.
Subscription of 2015-2016 written off during 2017-2018 Rs. 50.
SOLUTION
AN EXTRACT OF INCOME AND EXPENDITURE ACCOUNT
Dr. for the year ended 31st March, 2018
2018 Cr.

Expenditure Rs. Income Rs.

To Supscriptions w/o 50 By Subscriptions (See working note) 1,44,000

AN EXTRACT OF BALANCE SHEET AS AT 31 ST MARCH, 2018

Liabilities Rs. Assets Rs.

Subscription received in advance Subscription Outstanding

for 2018-2019 (7 200 + Rs. for 2015-2016 (7 500 - Rs. 400 -

4,000) 4,200 Rs. 50) 50

for 2019-2020 1,200 5,400 for 2016-2017 (7 9,000 - Rs.

8,900) 100

for 2017-2018 (7 7,000 - Rs. 100 - 6,950

Rs. 100) 6,800

Working Note:
CALCULATION OF SUBSCRIPTION INCOME FOR THE YEAR 2017-
2017-2018
Dr. SUBSCRIPTION ACCOUNT Cr.

Particulars Rs. Particulars Rs.

To O/s A/c (Beg.) 9,500 By Advance Subscription A/c (Beg.) 3,000

To Income & Exp. A/c (b.f.) 1,44,000 By Bank A/c 1,48,900

To Advance Subscription (end) 5,400 By Income & Exp. A/c (w/o) 50

By Outstanding Subscription A/c 6,950

1,58,900 1,58,900

QUESTION 5
How will you deal with the following items while preparing the Income and
Expenditure Account for the year ending on March 31, 2018 and a Balance Sheet as
on that date?

Particulars As at 1.4,2017 As at 31.3,2018

Rs. Rs.

Amount due to suppliers of Sports Materials 15,000 9,750

Advances to suppliers of Sports Materials 5,000 3,750

Stock of Sports Materials 10,500 2,500

During 2017-2018, the payment made to the suppliers of Sports Materials was Rs.
54,000. Cash Purchases 10% of Credit purchases.
SOLUTION
AN EXTRACT OF INCOME AND EXPENDITURE ACCOUNT
Dr. for the year ending on 31st March, 2018 Cr.

Expenditure Rs. Income Rs.

To Sports Materials consumed 63,000

AN EXTRACT OF BALANCE SHEET AS AT 31 ST MARCH, 2018

Liabilities Rs. Assefs Rs.

Creditors for Sports Materials 9,750 Advance for Sports Materials 3,750

Stock of Sports Materials 2,500

Working Notes:
Dr. (I) CREDITORS FOR SPORTS MATERIALS ACCOUNT Cr.

Particulars Rs. Particulars Rs.

To Balance b/d 5,000 By Balance b/d 15,000

To Bank A/c 54,000 By Stock of Sports Materials A/c

To Balance c/d 9,750 (Credit purchases)

(Balancing figure) 50,000

By Balance c/d 3,750

68,750 68,750

Dr. (II) STOCK

STOCK OF SPORTS MATERIALS ACCOUNT Cr.

Particulars Rs. Particulars Rs.

To Balance b/d 10,500 By Income and Expenditure A/c

To Creditor for Sports Materials (Sports Materials consumed)

(transfer) 50,000 (Balancing figure) 63,000

To Bank A/c (cash purchases) 5,000 By Balance c/d 2,500

65,500 65,500
QUESTION 6

Suppose salaries paid during 2016 were Rs.23,000. The following further information
is available:

Salaries unpaid on 31st March, 2015 1,400

“ pre-paid on “ “ 2015 400

“ un-paid on “ “ 2016 1,800
“ pre-paid “ “ 2016 600

Required

Calculate the amount to be debited to Income and expenditure account in respect of

salaries and also show necessary ledger accounts.

SOLUTION Salaries Account

Rs. Rs.
April, 1 To Prepaid Salaries A/c 400 April, By Salaries 1,400
1,
2015 2015
March, To Cash 23,000 March, Outstanding A/c By 600
31, 31,
2016 2016
To Salaries Outstanding 1,800 Salaries Prepaid A/c

A/c
By Transfer to 23,200
25,200 Income & 25,200
Expenditure
A/c

Salaries Outstanding Account

Rs. Rs.

April, To Salaries A/c 1,400 April,1, By Balance b/d 1,400

1,
2015 2015

March, To Balance c/d 1,800 March, By Salaries A/c 1,800

31, 31,
2016 2016
3,200 3,200
April, By Balance b/d 1,800
1,
2016
 Salaries Prepaid Account
Rs. Rs.
Apri To Balance b/d 400 April, 1, By Salaries A/c 400
l, 2015
201 (transfer)
5
March, To Salaries A/c 600 March, By Balance c/d 600
31, 31,
2016 2016
1,000 1,000
April, To Balance b/d 600
1,
2016

QUESTION 7

The following was the Receipts and Payments Account of Exe Club for the year
ended March. 31, 2016

All the figures in thousands

Receipts Rs. Payments Rs.

Cash in hand 100 Groundsman’s Fee 750
Balance at Bank as per Pass Moving Machine 1,500
Book:
Deposit Account 2,230 Rent of Ground 250
Current Account 600 Cost of Teas 250
Bank Interest 30 Fares 400
Donations and Subscriptions 2,600 Printing & Office Expenses 280
Receipts from teas 300 Repairs to Equipment 500
Contribution to fares 100 Honorarium to Secretary and
Sale of Equipment 80 Treasurer of 2015 400
Net proceeds of Variety Balance at Bank as per Pass
Book:
Entertainment 780 Deposit Account 3,090
Donation for forth coming Current Account 150
Tournament 1,000 Cash in hand 250
7,820 7,820
You are given the following additional information:

April, 1, 2015 March, 31, 2016

Rs. Rs.

Subscription due 150 100

Amount due for printing etc. 100 80
Cheques unpresented being payment for repairs 300 260
Estimated value of machinery and equipment 800 1,750
Interest not yet entered in the Pass book 20
Bonus to Groundsman o/s. 300

For the year ended March. 31, 2016, the honorarium to the Secretary and Treasurer
are to be increased by a total of Rs.200.

Required

Prepare the Income and Expenditure Account for period ending 31-03-2016 and the
relevant Balance Sheet.

SOLUTION
Income and Expenditure Account of Exe Club
for the year ending 31st March, 2016

(all figures in thousand)

Expenditure Rs. Income Rs.

To Groundsman’s fee 750 By Donations and 2,550
To Rent of Ground 250 50
Subscription By Receipts
To Fares’ Expenses 400
Less : Contribution (100) 300 from teas
(Fares) less
To Printing & Office 260 expenses
Expenses (Rs.300 -
To Repairs 460 780
Rs.250)
To Depreciation on 50
Machinery By Proceeds of Variety
Opening balance and 2,300 Entertainment
Purchases By Interest (Rs.30 +
Less: Closing Balance (1,750) Rs.20)

550
Less: Sale (80) 470
To Honorarium to Sect. &
Treasurer 600
To Bonus to Groundsman 300
To Excess of Income over
Expenditure 40
3,430 3,430

Balance Sheet of Exe Club as on 31st March, 2016

Liabilities Rs. Assets Rs.

Outstanding Expenses:
Groundsman Bonus 300 Cash in hand 250
Printing 80 Cash in Deposit A/c 3,090
Honorarium 600 Subscription Due 100
Bank Overdraft (Rs.260- 110 Interest Due 20
Rs.150)
Capital Fund: Opening 3,080 Machinery & Equipments 1,750
Add: Surplus for the year 40 3,120

Tournament Fund 1,000

(Donation) 5,210 5,210

Balance Sheet as on 1st April,

2015

Liabilities Rs. Assets Rs.

Outstanding Expenses and Cash in hand 100
Honorarium (Rs.100 + Rs.400) 500 Cash in Deposit A/c 2,230
Capital Fund (Balancing Figure) 3,080 Cash in Current A/c 300
Subscription Due 150
Machinery 800
3,580 3,580
QUESTION 8

The Income and Expenditure Account of the Youth Club for the Year 2016 is as
follows:

Expenditure Rs. Income Rs.

To Salaries 4,750 By Subscription 7,500
To General Expenses 500 250
To Audit Fee 250 By Entrance Fees

To Secretary’s Honorarium 1,000 By Contribution 1,000

To Stationery & Printing 450 for annual
To Annual Dinner Expenses 1,500 dinner
To Interest & Bank Charges 150 By 750
Annual Sport
To Depreciation 300
meet receipts
To Surplus 600
9,500 9,500

This account had been prepared after the following adjustments:

Rs.
Subscription outstanding at the end of 2015 600
Subscription received in Advance on 31st December, 2015 450
Subscription received in advance on 31st December, 2016 270
Subscription outstanding on 31st December, 2016 750

Salaries Outstanding at the beginning and the end of 2016 were respectively Rs.400
and Rs.450. General Expenses include insurance prepaid to the extent of Rs.60.
Audit fee for 2016 is as yet unpaid. During 2016 audit fee for 2015 was paid
amounting to Rs.200.

The Club owned a freehold lease of ground valued at Rs.10,000. The club had sports
equipment on 1st January, 2016valued at Rs. 2,600. At the end of the year, after
depreciation, this equipment amounted to Rs.2,700. In 2015, the Club has raised a
bank loan of Rs. 2,000. This was outstanding throughout 2016. On 31st December,
2016 cash in hand amounted to Rs.1,600.

Required

Prepare the Receipts and Payments Account for 2016 and Balance Sheet as at the
end of the year.
 SOLUTION

The Youth Club

Receipts and Payments Account
for the year ended 31st December, 2016

Rs. Rs. Rs. Rs.

Receipts Payments
To Balance b/d (balancing figure) 1,390 By Salaries 4,750
To Subscriptions as per Income 7500 Add: Paid for 400

& Expenditure Account 2015 5,150

Add: 2015’s Received (450)

600 4,700
Less: Unpaid 500
2017’s Received 270
for 2016 By
General Expenses

8,370 Add : Paid for 60 560

Less: 2016’s Received in 2015 (450) By 2017 Audit fee 200
7,920 (2016) Secy. 1,000
By
Less: 2016’s Outstanding (750) 7,170 450
By Honorarium
To Entrance Fees 250 1,500
To Contribution for annual 1,000 By Stationery & 150
Dinner By Printing
To Sport meet : Annual Dinner
Receipt less 750 By 400
Expenses Interest &
1,600
Bank Charges
10,56 10,560
By
0
Sports
To Balance b/d 1,600
Equipments

[2700 - (2600

- 300)]

Balance c/d
 Balance Sheet of Youth Club as at December 31, 2016

Rs. Rs. Rs. Rs.

Liabilities
Liabilities Assets
Subscription received Freehold Ground 10,000
in advance 270 Sport Equipment:
Audit Fee Outstanding 250 As per last
Salaries Outstanding 450 Balance Sheet 2,600
Bank Loan 2,000 Additions 400
Capital Fund : 3,000
Balance as per previous Less : Depreciation (300) 2,700
Balance Sheet 11,540
Add : Surplus for 2016 600 12,140 Subscription Outstanding 750
Insurance Prepaid 60
Cash in hand 1,600
15,110 15,110

Balance Sheet of Youth Club as at

at 31st December, 2015

Rs. Rs.
Liabilities Assets
Subscriptions received in advance 450 Freehold Ground 10,00
0
Salaries outstanding 400 Sports Equipment 2,600
Audit fees unpaid 200 Subscriptions Outstanding 600
Bank Loan 2,000 Cash in hand 1,390
Capital Fund (balancing figure) 11,540
14,590 14,59
0
QUESTION 9

From the following Income and Expenditure Account and the Balance Sheet of a club,
prepare its Receipts and Payments Account and Subscription Account for the year
ended 31st March, 2016:

Income
Income & Expenditure Account for the year 2015-
2015-16
Rs. Rs.

To Upkeep of Ground 10,000 By Subscriptions 17,320

To Printing 1,000 By Sale of Newspapers (Old) 260
To Salaries 11,000 By Lectures 1,500
To Depreciation on Furniture 1,000 By Entrance Fee 1,300
To Rent 600 By Misc. Income 400
By Deficit 2,820
23,600 23,600

Balance Sheet as at 31st March, 2016

Rs. Rs.
Liabilities Assets
Subscription in Furniture 9,000
Advance
(2016-17) 100 Ground and Building 47,000
Prize Fund : Prize Fund Investment 20,000
Opening Balance 25,000 Cash in Hand 2,300
Add : Interest 1,000 Subscription (outstanding) 700
(2015-16)
26,000
Less : Prizes (2,000) 24,000
General Fund :
Opening Balance 56,420
Less : Deficit (2,820)
53,600
Add : Entrance Fee 1,300 54,900
79,000 79,000

The following adjustments have been made in the above accounts:

(1) Upkeep of ground Rs. 600 and Printing Rs. 240 relating to 2014-2015 were paid
in 2015-16.
(2) One-half of entrance fee has been capitalised by transfer to General Fund.
(3) Subscription outstanding in 2014-15 was Rs. 800 and for 2015-16 Rs.700.
(4) Subscription received in advance in 2014-15 was Rs.200 and in 2015-16 for
2016-17 Rs. 100.

SOLUTION Receipts and Payments Account

for the year ending 31st March, 2016

Rs. Rs.
Receipts Payments
To Balance b/d By Upkeep of
(Balancing figure) 4,660 Ground (10,000 10,600
To Subscription 17,320 By + 600) 1,240
Printing (1,000
To Interest on Prize Fund 1,000 By 11,000
+ 240) Salaries
Investments By
Ren
To Lecture (fee) 1,500 By 600
t
To Entrance Fee 2,600 By 2,000
Priz
To Sale of Newspapers (old) 260 2,300
es
To Misc. Income 400 Balance c/d
27,740 27,740

Working note: Rs. 600 paid for upkeep of ground for 2014-15 and
Rs.240 paid for printing have been added to the amount shown as
expenditure for the year to arrive at total payment under these heads.

Subscription Account
2015 Rs. 2015 Rs.

April To April 1 By Cash (Balancing 17,320

Subscriptio figure) By Subscription
800 Outstanding (2015- 700
n
16)
Outstanding 100 200
2016 By Subscription
(2014-15)
March in Advance (2014-
To Subscription
17,320 15)
In Advance (2016-17)
18,220 18,220

To Income &
Expenditure A/c
QUESTION 10
The Sportwriters Club gives the following Receipts and Payments Account for the
year ended March 31, 2016:

Receipts and Payments Account

Receipts Rs. Pa yments
yments Rs.

To Balance b/d 4,820 By Salaries 12,000

To Subscriptions 28,600 By Rent and electricity 7,220

To Miscellaneous income 700 By Library books 1,000

To Interest on Fixed deposit 2,000 By Magazines and newspapers 2,172

By Sundry expenses 10,278

By Sports equipments 1,000

By Balance c/d 2,450

36,120 36,120

Figures of other assets and liabilities are furnished as follows:

As at March
31
Rs. Rs.
2015 2016
Salaries outstanding 710 170
Outstanding rent & electricity 864 973
Outstanding for magazines and newspapers 226 340
Fixed Deposit (10%) with bank 20,000 20,000
Interest accrued thereon 500 500
Subscription receivable 1,263 1,575
Prepaid expenses 417 620
Furniture 9,600
Sports equipments 7,200
Library books 5,000

The closing values of furniture and sports equipments are to be determined after
charging depreciation at 10% and 20% p.a. respectively inclusive of the additions, if
any, during the year. The Club's library books are revalued at the end of every year
and the value at the end of March 31, 2016 was Rs. 5,250.

Required
From the above information you are required to prepare:
(a) The Club's Balance Sheet as at March 31, 2015;
(b) The Club's Income and Expenditure Account for the year ended March 31, 2016.
(c) The Club's Closing Balance Sheet as at March 31, 2016.
SOLUTION

(a) Sportswriters Club

Balance Sheet as on 31st March, 2015

Liabilities Rs. Rs. Assets

Assets Rs.
Outstanding expenses : Furniture 9,600
Salaries 710 Library Books 5,000
Rent & Electricity 864 Sports Equipment 7,200
Magazines & Newspapers 226 1,800 Fixed Deposit 20,000
Capital Fund (Balancing
Balancing 47,000 Cash in hand & at Bank 4,820
figure)
figure
Prepaid Expenses 417
Subscription receivable 1,263
Interest accrued 500
48,800 48,800

(b) Income and Expenditure Account for the year ending 31st March, 2016
Expenditure Rs. Income Rs.
To Salaries 11,460 By Subscription 28,912
To Rent & Electricity 7,329 By Interest on FD 2,000
To Magazines & Newspapers 2,286 By Misc. Income 700
To Sundry Expenses 10,075 By Excess of expenditure
To Depreciation : over income 2,888
Furniture 960
Sports Equipment 1,640
Library Books 750 3,350
34,500 34,500

(c) Balance Sheet of Sports Writers Club

as on 31st March, 2016

Rs. Rs. Rs. Rs.

Liabilities Assets
Outstanding Furnitur
Expenses: e Cost
Salaries 170 9,600
Less : Depreciation
Rent & Electricity 973 (960) 8,640
Magazines & Sport
Newspapers 340 1,483
Capital Fund: Equipment:
 Opening balance 47,000 Opening balance 7,200
Less : Excess of Addition 1,000
exp. over (2,888) 44,112 8,200
income
Less : (1,640) 6,560

Depreciation
Library Books : 5,000
1,000
Opening Balance
6,000
Addition
(750) 5,250
20,000
Less : 2,450
Depreciation 620
Fixed Deposit 1,575
500
Cash in hand & at bank
45,59 45,595
5 Prepaid Expenses
Subscription Receivable
Interest accrued

Working Notes:

(i) Expenses Salaries Rent & Magazines Sundry

Electricity & News-
News- Expense
Papers s
Rs. Rs. Rs.
Rs.
Paid during the year 12,000 7,220 2,172 10,278
170 973 340 –
Add : Outstanding on 31.3.2016
– – – 417
Less : Prepaid on 31.3.2015 12,170 8,193 2,512 10,695
Less : Outstanding (710) (864) (226) –
on 31.3.2015 Less – – – (620)
11,460 7,329 2,286 10,075
: Prepaid on Rs.
(ii) 31.3.2016
Expenditure for 960
1,640
the year
Depreciation 6,000
(a) Furniture @10% on Rs.9,600 (5,250) 750
(iii)
 (b) Sports Equipment @ 20% on 28,600
Rs.8,200 1,575
30,175
(c) Library books
(1,263)
- book value 28,912
Revalued at
Subscription
Received in cash
Add : Receivable on 31.3.2016

Less: Receivable on 31.3.2015

QUESTION 11

From the following data, prepare an Income and Expenditure Account for the year
ended 31st December, 2016, and Balance Sheet as at that date of the Mayura
Hospital.

Receipts and Payments Account for the

year ended 31 December, 2016

Receipts Rs. Rs. Payments Rs.

To Balance b/d By Salaries :
Cash 400 (Rs.3,600 for 15,600
2015)
Bank 2,600 3,000 By
Hospital 8,500
By Equipment
By Furniture
To Subscriptions : 3,000
For 2015 2,550 purchased 25,000
By Additions to
For 2016 12,250 1,200
For 2017 1,200 By Building Printing
To Government Grant : & Stationery 7,800
For building 40,000
By
For maintenance 10,000 Diet 1,000
Fees from sundry expenses
Rent and
rates
(Rs.150 for
2017)
Electricity and
water
 Patients 2,400 Charges 1,200
To Donations (not to 4,000 By office expenses 1,000
be
capitalised) By Investments 10,000
To Net collections By Balances :
from
benefit shows 3,000 Cash 700
Bank 3,400 4,100
78,400 78,400

Additional information :
Value of building under construction as on 31.12.2016 70,000
Value of hospital equipment on 31.12.2016 25,500
Building Fund as on 1.1. 2016 40,000
Subscriptions in arrears as on 31.12.2015 3,250
Investments in 8% Govt. securities were made on 1st July, 2016.
SOLUTION

Mayura Hospital
Income & Expenditure Account
Account
for the year ended 31 December, 2016

Expenditure Rs. Inc ome Rs.

To Salaries 12,000 By Subscriptions 12,250
To Diet expenses 7,800 By Govt. Grants (Maintenance) 10,000
To Rent & Rates 850 By Fees, Sundry Patients 2,400
To Printing & Stationery 1,200 By Donations 4,000
To Electricity & Water-charges 1,200 By Benefit shows (net collections) 3,000
To Office expenses 1,000 By Interest on Investments 400
To Excess of Income over
expenditure transferred to
Capital
Fund 8,000
32,050 32,050

Balance Sheet as at 31st December, 2016

Rs. Rs. Rs. Rs.

Liabilities Assets
Capital Fund : Building :
Opening balance 24,650 Opening balance 45,000
Excess of Income 25,000 70,000
Addition
Over Expenditure 8,000 32,650
Hospital
Building Fund : 17,000
Opening balance 40,000 Equipment : 8,500 25,500
Add : Govt. Grant 40,000 80,000 3,000
Opening
Subscriptions
balance
received in advance 1,200 10,000
Addition
700
Furniture
400
Investments -
8% Govt. Securities
Subscriptions receivable 150

Accrued interest
3,400

Prepaid expenses (Rent) 700

Cash at Bank
1,13,850 1,13,850
Cash in hand

Working Notes:

Balance sheet as at 31st December,

December, 2015

Liabilities Rs. Assets Rs.

(1) Capital Fund Building 45,000

(Balancing Figure) 24,650 Equipment 17,000
Building Fund 40,000 Subscription Receivable 3,250
Creditors for Expenses : Cash at Bank 2,600
Salaries payable 3,600 Cash in hand 400
68,250 68,250
Rs.
(2) Value of Building
Balance on 31st December, 70,000
2016
Paid during the year 25,000
Balance on 31st December, 45,000
(3) 2015
Value of Equipment
Balance on 31st December, 25,500
2016
Paid during the year (8,500)
Balance on 31st December, 17,000
(4) 2015
Subscription due for 2015
Receivable on 31st 3,250
December, 2015
Received in 2016 2,550
Still Receivable for 2015 700

QUESTION 12

The receipts and payments account and the income and expenditure account of a Club
for the year ended 31st December, 2016 were as follows:

Receipts and Payments Account

Rs. Rs. Rs.

Receipts Payments
To Balance b/d 2,500 By Books purchased 1,000
To Subscriptions: By Printing and Stationery 200
2015 600 By Salary 1,500
2016 4,300 4,900 By Advertisement 200
To Interest 500 By Electric Charge 400
To Rent:
2015 150

2016 300 450

To Govt. Grants 2,000

10,650 10,650

Income and Expenditure Account

Rs. Rs.
Expenditure Income
To Salary 2,800 By Interest 400
To Tent Hire 200 By Subscription 4,800
To Electric charges 400 By Rent 2,300
To Depreciation on Building 750 By Govt. Grant 2,000
To Printing and Stationery 200
To Advertisement 150
To Surplus 5,000
9,500 9,500

The club’s assets as on 1st January 2016 were : Building Rs. 15,000; Books Rs.10,000

Furniture Rs.4,000; Investments Rs.10,000

Liabilities as on that date were Rs.50 for advertisement and Rs.100 for salary.

Required

Prepare the balance sheet of the club on 31st December, 2015 and 31st December,
2016.

SOLUTION
Balance Sheet
As at 31st December, 2015

Rs. Rs.
Liabilities Assets
Capital fund (Bal. fig.) 42,200 Cash in hand 2,500
Outstanding for advertisement 50 Subscriptions outstanding 600
Outstanding for salary 100 Interest outstanding 100
Rent receivable 150
Buildings 15,000
Books 10,000
Furniture Purchased 4,000
Investments 10,000
42,350 42,350
Balance Sheet
As at 31st December, 2016

Rs. Rs.
Liabilities Assets
Donation for Special 300 Cash in hand 7,350
Fund
Outstanding for salary 1,400 Subscriptions 500
outstanding
Outstanding for Tent 200 Books 10,000
hire
Capital Fund Add: Purchase 1,000 11,000
Balance on 31/12/15 42,200
Add: Surplus 5,000 47,200 Buildings 15,000
Less: Dep. (750) 14,250
Furniture 4,000
Investments 10,000
Accrued Rent 2,000
49,100 49,100

Note: In the above solution, it is assumed that Rs. 100 (Rs. 500-Rs. 400)
excess interest received during the year is in relation to the outstanding
interest of the last year.

QUESTION 13

From the following balances and particulars of Republic College, prepare Income &
expenditure Account for the year ended March, 2016 and a B. Sheet as on the date :

Rs. Rs.
Seminars & Conference Receipts 4,80,000
Consultancy Receipts 1,28,000
Security Deposit – Students 1,50,000
Capital Fund 16,06,000
Research Fund 8,00,000
Building Fund 25,00,000
Provident Fund 5,10,000
Tuition Fee Received 8,00,000
Government Grants 5,00,000
Donations 50,000
Interest & Dividends on Investments 1,85,000
Hostel Room Rent 1,75,000
Mess Receipts (Net) 2,00,000
College Stores-Sales 7,50,000
Outstanding expenses 2,25,000
Stock of-stores and Supplies (opening) 3,00,000
Purchases - Stores & Supplies 8,00,000
Salaries - Teaching 8,50,000
Research 1,20,000
Scholarships 80,000
Students Welfare expenses 38,000
Repairs & Maintenance 1,12,000
Games & Sports Expenses 50,000
Misc. Expenses 65,000
Research Fund Investments 8,00,000
Other Investments 18,50,000
Provident Fund Investment 5,10,000
Seminar & Conference Expenses 4,50,000
Consultancy Expenses 28,000
Land 1,00,000
Building 16,00,000
Plant and Machinery 8,50,000
Furniture and fittings 6,00,000
Motor Vehicle 1,80,000
Provision for Depreciation:
Building 4,80,000
Plant & Equipment 5,10,000
Furniture & Fittings 3,36,000
Cash at Bank 6,42,000
Library 3,60,000
1,03,85,000 1,03,85,000

Adjustments:
Rs.

(1) Materials & Supplies consumed: (From college stores)

Teaching 50,000
Research 1,50,000
Students Welfare 75,000
Games or Sports 25,000
(2) Tuition fee receivable from Government for backward class Scholars 80,000
(3) Stores selling prices are fixed to give a net profit of 10% on selling
price
(4) Depreciation is provided on straight line basis at the following
rates:
(1) Building 5%
(2) Plant & Equipment 10%
(3) Furniture & Fixtures 10%
(4) Motor Vehicle 20%
 SOLUTION

Republic College
Income and Expenditure Account
for th
the
e year ending 31st March, 2016
Expenditure Rs. Rs. Income Rs. Rs.
To Salaries: By Tuitions & other fee 8,80,000
Teaching 8,50,000 5,00,000
By Govt. Grants
Research 1,20,000
1,85,000
To Material & Supplies By Income from 1,75,000
Consumed: Teaching
50,000 By Investments Hostel 2,00,000
Research
1,50,000 By room Rent 75,000
To Repairs & Maintenance
1,12,000 By Mess Receipts
To Sports & Games By Profit-Stores
Expenses: 4,80,000
Sales Seminar
Cash 50,000
Materials 25,000 75,000 and Conferences
Income 30,000
450,000
To Students Welfare Less: Exp
Expenses:
Cash 38,000 By Consultancy
1,13,000
Materials 75,000 Charges: 1,28,000
Income
To Scholarships 80,000 28,000 1,00,000
Less: Expenses
50,000
To Depreciation: By Donations
80,000
Building
85,000
Plant & Equipment
Furniture 60,000
Motor Vehicle 36,000

To Surplus
3,19,000
21,95,000
21,95,000
 Republic College
Balance Sheet as on 31st
March, 2016

Liabilities Rs. Rs. Assets Rs. Rs.

Fixed Assets:
Capital Fund Land 1,00,000
Opening balance 16,06,000 Building Cost 16,00,000
Add: Excess of Income Less: Depreciation (5,60,000) 10,40,000
over Expenditure 3,19,000 19,25,000 Equipment Cost 8,50,000
Other Funds Less: Depreciation (5,95,000) 2,55,000
Research Fund 8,00,000 Furniture & Fittings:
Building Fund 25,00,000 Cost 6,00,000
Less: Depreciation (3,96,000) 2,04,000
Current Liabilities : Motor Vehicles
Outstanding Expenses 2,25,000
Provident Fund 5,10,000 Cost : 1,80,000
Security Deposit 1,50,000 Less: Depreciation (36,000) 1,44,000
Library 3,60,000
Investments:
Capital Fund Investments 18,50,000
Research Fund 8,00,000
Investment
P.F. Investment 5,10,000
Stock (stores)
Material & Supplies 1,25,000
Tuition fees receivable 80,000
Cash in hand & at Bank
6,42,000
61,10,000 61,10,000

Working Notes:
Rs. Rs.
(1) Material & Supplies - Closing Stock
Op St 3,00,000
8,00,000
Pur.
11,00,000
6,75,000
Less : Cost of Material & 3,00,000 (9,75,000)
Supplies Consumed Balance 1,25,000
 Provisions for Depreciation

(2)

Opening Balance
Building Plant & Furniture &
Addition
Closing Balance Equipment Fitting
Rs. Rs. Rs.
Note: Expense related to income earned like
consultancy charges, conference expenses are 4,80,000 5,10,000 3,36,000
shown as net of income. 80,000 85,000 60,000
5,60,000 5,95,000 3,96,000

QUESTION 14

The following is the Receipts and Payments Account of Lion Club for the year ended
31st March, 2016

Receipts Rs. Payments Rs.

Opening balance: Salaries 1,20,000

Cash 10,000 Creditors 15,20,00

0
Bank
3,850 Printing and stationary 70,000
Subscription received 2,02,750 Postage 40,000
Entrance donation 1,00,000 Telephones and telex 52,000
Interest received 58,000 Repairs and maintenance 48,000
8,000 Glass and table linen 12,000
Sale of assets
9,000 Crockery and cutlery 14,000
Miscellaneous income
Garden upkeep 8,000
Receipts at
10,70,000 Membership fees 4,000
Coffee room

Soft drinks 5,10,000 Insurance 5,000

Swimming pool 80,000 28,000
Tennis court 1,02,000 Electricity
Cl Balance:
Cash 8,000
21,53,600 Bank 2,24,600
21,53,600 21,53,600

The assets and liabilities as on 1.4.2015 were as follows:

 Rs.
Fixed assets (net) 5,00,000
Stock 3,80,000
Investment in 12% Government securities 5,00,000
Outstanding subscription 12,000
Prepaid insurance 1,000
Sundry creditors 1,12,000
Subscription received in advance 15,000
Entrance donation received pending membership 1,00,000
Gratuity fund 1,50,000

The following adjustments are to be made while drawing up the accounts:

Subscription received in advance as on 31st March, 2016 was Rs. 18,000.

Outstanding subscription as on 31st March, 2016 was Rs. 7,000.

Outstanding expenses are salaries Rs. 8,000 and electricity Rs. 15,000.

50% of the entrance donation was to be capitalized. There was no pending

membership as on 31st March, 2016.

The cost of assets sold net as on 1.4.2015 was Rs. 10,000.

Depreciation is to be provided at the rate of 10% on assets.

A sum of Rs.20,000 received in October 2015 as entrance donation from an

applicant was to be refunded as he has not fulfilled the requisite membership
qualifications. The refund was made on 3.6.2016.

Purchases made during the year amounted Rs. 15,00,000.

The value of closing stock was Rs. 2,10,000.

The club as a matter of policy, charges off to income and expenditure account all
purchases made on account of crockery, cutlery, glass and linen in the year of
purchase.
You are required to prepare an Income and Expenditure Account for the year ended
31st March, 2016 and the Balance Sheet as on 31st March, 2016 along with
necessary workings.

Income and Expenditure Account of Lion Club

for the year ended 31st March, 2016
Expenditure Rs. Income Rs.

To Salaries 1,28,000 By
Subscription 1,94,750
To Printing and stationary 70,000 By Entrance donation
90,000
To Postage 40,000 By Interest
60,000
To Telephone and telex 52,000 By Miscellaneous income 9,000
To Repairs and maintenance 48,000 By Profit from operations 92,000
To Glass and table linen 12,000 By Excess of expenditure over income
To Crockery and cutlery 14,000 (deficit) transferred to capital
fund 30,250
To Garden upkeep 8,000
To Membership fees 4,000
To Insurance 6,000
To Electricity charges 43,000
To Loss on sale of assets 2,000
To Depreciation 49,000
4,76,000
4,76,000
 Balance Sheet of Lion
Club as on 31st March,
2016

Liabilities Rs. Assets Rs.

Capital fund 10,89,600 Fixed assets 4,41,000

Gratuity fund 1,50,000 Stock 2,10,000
Sundry creditors 92,000 Investments 5,00,000
Subscription received in advance 18,000 Subscription outstanding 7,000
Entrance donation refundable 20,000 Interest accrued 2,000
Outstanding expenses 23,000 Bank 2,24,600
Cash 8,000
13,92,600 13,92,600

Working Notes:
1. Opening Balance
Balance Sheet
Balance Sheet of Lion Club as on 1st April, 2015

Rs. Rs.
Liabilities Assets
Sundry creditors 1,12,000 Fixed assets 5,00,000
Subscription received in advance 15,000 Stock 3,80,000
Entrance donation received in 1,00,000 Investments 5,00,000
advance
Gratuity fund 1,50,000 Subscription outstanding 12,000
Capital fund (balance figure) 10,29,850 Prepaid expenses 1,000
Cash 10,000
Bank 3,850
14,06,850 14,06,850
2. Subscription

Rs.

Subscription received during the year 2,02,750

Add: Outstanding subscription on 31.3.2016 7,000
2,09,750
Add: Received in advance as on 1.4.2015 15,000
2,24,750
Less: Outstanding subscription as on 1.4.2015 (12,000)
2,12,750
Less: Received in advance as on 31.3.2016 (18,000)
1,94,750

3. Entrance donation
Entrance donation received during the year 1,00,000
Add: Received in advance as on 1.4.2015 1,00,000
2,00,000
Less: Entrance donation in respect of ineligible member (20,000)
1,80,000
Less: 50% capitalized (90,000)
Taken to income and expenditure account 90,000

4. Loss on sale of Asset

Cost of asset sold 10,000
Less: Sale proceeds (8,000)
Loss on sale of asset 2,000

5. Depreciation
Rs.
Fixed asset as per trial balance 5,00,000
Less: Cost of asset sold (10,000)
4,90,000
Depreciation on Rs. 4,90,000 @ 10% 49,000
6. Salaries
Rs.

Salary paid during the year

Add: Outstanding as on 31.3.2016 1,20,000

8,000
1,28,000

7. Electricity charges

Rs.

Electricity charges paid during the year

Add: Outstanding as on 31.3.2016 28,000

15,000
43,000

8. Interest
Interest

Rs.
Interest on 12% Government securities investment (Rs. 5,00,000
@ 12% p.a.)
60,000
Less: Interest
received during the (58,000)
2,000
year Interest 60,000
accrued
Interest credited to Income and Expenditure Account

9. Profit from operations

Rs.
Cost of goods sold:
Opening stock₹ 3,80,000
Add: Purchases 15,00,000
18,80,000
Less: Closing stock 2,10,000
Cost of goods sold (A) 16,70,000
Receipts from operations:
Receipts from coffee room 10,70,000
Receipts from soft drinks 5,10,000
Receipts from swimming pool 80,000
Receipts from tennis court 1,02,000
Total Receipts (B) 17,62,000
Profit from operations (B-A)
92,000

Insurance
Rs.
Insurance paid during the year 5,000
Add: Prepaid Insurance as on 1.4.2015 1,000
6,000

Sundry creditors

Opening balance as on 1.4.2015

1,12,000
Add: Purchases made during the year
15,00,000

Less: Payments made during the year

(15,20,000)
Closing balance as on 31.3.2016
92,000

Outstanding expenses
Rs.

Outstanding salaries Outstanding 8,000

electricity charges 15,000
23,000
Outstanding expenses
10. Fixed assets
Rs.

Fixed assets as on 1.4.2015

Less: Cost of assets sold 5,00,000

(10,000)
Less: Depreciation
Fixed assets as on 31.3.2016
4,90,000

(49,000)

4,41,000

11. Capital fund

Rs.

Capital fund as on 1.4.2015

Add: Entrance donation capitalised 10,29,850

90,000
Less: Excess of expenditure
over income Balance as on
11,19,850
31.3.2016
(30,250)

10,89,600

QUESTION 15

For year ending 31st March, 2015 12,000

For year ending 31st March, 2016 6,15,000
For year ending 31st March, 2017 18,000
Total 6,45,000

There are 500 members and annual subscription is Rs. 1,500 per member.
On 31st March, 2016, a sum of Rs. 15,000 was still in arrears for subscriptions

During the year ended 31st March, 2016, Sachin Cricket Club received
subscriptions as follows: for the year ended 31st March, 2015. Ascertain the
amount of subscriptions that will appear on the credit side of

Income and Expenditure Account for the year ended 31st March, 2016. Also
show how the items would appear in the Balance Sheet as on 31st March, 2015
and the Balance Sheet as on 31st March, 2017.
 Income & Expenditure Account (An extract) of Sachin Cricket Club
For the year ended 31st March, 2016

By Subscription
Rs. Rs.
(500 members × Rs. 1,500 per
7,50,000

Balance Sheet of Sachin Cricket Club as on 31st March, 2015 (An

extract)

Liabilities Rs. Assets Rs.

Subscription Receivable 27,000

(Rs.15,000 + Rs.12,000)

Balance Sheet of Sachin Cricket Club as on 31st March, 2016 (An

extract)
extract)

Liabilities Rs. Assets Rs.

Unearned 18,000 Rs.

Subscription Outstanding Subscription

of 2014-15
15,000 1,50,000
of 2015-16
Rs. (7,50,000 – 6,15,000)
1,35,000

QUESTION 16

Summary of receipts and payments of Bombay Medical Aid society for the year
ended 31.12.2016 are as follows:

Opening cash balance in hand Rs. 8,000, subscription Rs. 50,000, donation Rs.
15,000 (raised for meeting revenue expenditure), interest on investments @ 9%
p.a. Rs. 9000, payments for medicine supply Rs. 30,000 Honorarium to doctor
Rs. 10,000,salaries Rs. 28,000, sundry expenses Rs. 1,000, equipment purchase
Rs. 15,000, charity show expenses Rs.1,500 charity show collections Rs. 12,500.

Additional information:
 1.1.2016
1.1.2016 31.12.2016
Subscription due 1,500 2,200
Subscription received in advance 1,200 700
Stock of medicine 10,000 15,000
Amount due for medicine supply 9,000 13,000
Value of equipment 21,000 30,000
Value of building 50,000 48,000

You are required to prepare receipts and payments account and income and
expenditure account for the year ended 31.12.2016 and balance sheet as on
31.12.2016.
Receipts and Payments Account of Bombay Medical Aid Society
for the year ended 31st December, 2016

Receipts Rs. Payments Rs.

To Cash in hand (opening) 8,000 By Medicine supply 30,000
To Subscription 50,000 By Honorarium to doctors 10,000
To Donation 15,000 By Salaries 28,000
To Interest on investment 9,000 By Sundry expenses 1,000
To Charity show collections 12,500 By Purchase of equipment 15,000
By Charity show expenses 1,500
By Cash in hand (closing) 9,000
94,500 94,500

Income and Expenditure Account of Bombay Medical Aid

Aid Society
for the year ended 31st December, 2016

Expenditure Rs. Income Rs.

To Medicine 29 ,000 By Subscription By 51,200
consumed To 10,000 Donation 15,000
Honorarium to 28,000 By Interest on investments 9,000
doctors To 1,000 By Profit on charity show:
Salaries Show collections 12,500
Less: Show expenses (1,500)
To Sundry 6,000 11,000
2,000
expenses To 8,000
Depreciation
10,200
on
86,200 86,200
 Equipment
Building
To Surplus-excess of
income over
expenditure

Balance Sheet of Bombay Medical Aid Society

as on 31st December, 2016

Liabilities Rs. Rs. Assets Rs. Rs.

Capital fund: Building 50,000

Opening balance 1,80,300 Less: Depreciation (2,000)
48,000
Add: Surplus 10,200 1,90,500 Equipment
21,000
Subscription received in 700 Add:
Purchase 15,000
advance
Amount due for medicine 13,000
36,000
supply Less: Depreciation 6,000
30,000
Stock of medicine
15,000
Investments
1,00,000
Subscription receivable
2,200
Cash in hand
9,000
2,04,200
2,04,200
Working Notes:

Subscription for the year ended 31st December, 2016: Rs.

Subscription received during the year 50,000
Less: Subscription receivable on 1.1.2016 1,500
Less: Subscription received in advance on 31.12.2016 700 (2,200)
47,800

Add: Subscription receivable on 31.12.2016 2,200

Add: Subscription received in advance on 1.1.2016 1,200 3,400
51,200

Balance Sheet of Medical Aid Society

as on 1st January 2016

Liabilities Rs.
Assets
Rs
Capital fund (balancing figure) 1,80,300 Building
Subscription received in advance 1,200 Equipment 50,000

Amount due for medicine supply 9,000 Stock of

medicine 21,000

Investments (Rs. 9,000 x

100/9) 10,000
Subscription receivable 1,00,000
Cash in hand
1,500
1,90,500

8,000
1,90,500
 Purchase of medicine:
Payment for medicine supply 30,000
Less: Amounts due for medicine (9,000)
supply on 1.1.2016
21,000
Add: Amounts due for medicine 13,000
supply on 31.12.2016
34,000
Medicine consumed:
Stock of medicine on 1.1.2016 10,000
Add: Purchase of medicine during 34,000
the year
44,000
Less: Stock of medicine on (15,000)
31.12.2016
29,000
Depreciation on equipment:
Value of equipment on 1.1.2016 21,000
Add: Purchase of equipment during 15,000
the year
36,000
Less: Value of equipment on (30,000)
31.12.2016
Depreciation on equipment for the 6,000
year

QUESTION 17
Prepare the Income & Expenditure Account and the Balance Sheet from the following
information:
RECEIPTS AND PAYMENTS ACCOUNT OF TULIKA
TULIKA CLUB, DELHI
Dr. for the year ending on 31st March, 2018 Cr.

Receipts Rs. Payments Rs.

To Balance b/f (cash) 1,025 By Upkeep of fields 220

To Subscriptions: By Salaries 600

2016-2017 40 By Drama Expenses 450

2017-2018 2,050 By Newspapers 150

2018-2019 60 2,150 By Books 100

To Admission Fees 40 By Municipal Taxes 40

To Life Membership subscription 100 By Charity 350

To Donations (on 1.11,2017) 500 By 12% General Investments

To Subscription for Tournament (on 1.11,2017) 500

(on 1.11,2017) 1,500 By 12% Tournament Fund

To Sales of old newspapers 45 Investments (on 1.11,2017) 1,500

To Sale of old bats etc. 50 By Tournament Expenses 1,200

To Proceeds of drama tickets 950 By Bats, Balls etc. 700

To Sale of old furniture 60 By Printing & Stationery 100

(costing 1100) By Furniture 250

To Interest on 12% General 12.50 By Prizes 1,115

Investments By Balance c/f (Cash) 3,725

To Interest on 12% Tournament

Fund Investments 37.50

To Subscription for Governor’s 3,450

Party

To Prize Fund 1,080

11,000 11,000

Additional Information:
(a) There are 500 members each paying an annual subscription of Rs. 5., Rs. 50
are still in arrear, for the year 2016-2017.
(b) Municipal taxes amounting to Rs. 40 per year have been paid upto June 30,
2018 and Rs. 50 are outstanding for salaries.
(c) On 1.4,2017 the club owned building valued at Rs. 5,000, Stock of Bats and
Balls Rs. 1,500, Printing and Stationery Rs. 200, Cash at Bank Rs. 3,000,
Books Rs. 500 and Furniture Rs. 600.
(d) Write 50% off Bats and Balls (without considering sale), 25% off printing and
stationery.
(e) Special subscription for governor's party outstanding Rs. 550.
(f) Admission fees to be treated as of revenue nature but Life Membership is to
be treated as of Capital nature.
SOLUTION
INCOME & EXPENDITURE ACCOUNT OF TULIKA
TULIKA CLUB
Dr. for the year ending on 31st March, 2018 Cr.

Expenditure Rs. Income Rs.

To Upkeep of fields 220 By Subscription (500 x Rs. 5) 2,500

To Salaries paid 600 By Admission Fees 40

Add: Outstanding at end 50 650 By Donations 500

To Drama Expenses 450 By Sale of old newspapers 45

To Newspapers 150 By Sale of old bats etc. 50

To Municipal Taxes Paid 40 By Proceeds of drama tickets 950

Add: Pre. in the beginning 10 By Interest on General

Invest..

Less: Prepaid at end 10 40 (500 x 12/100x5/12)

To Charity 350 Received Rs.

12.5

To Loss on sale of furniture 40 Accrued Rs. 25

12.5

To Printing & Stationery 75

To Bats & balls consumed 1,100

To Prize Exp. (1,115 - 1,080) 35

To Surplus 1,000

4,110 4,110

BALANCE SHEET OF TULIKA CLUB AS AT 31ST MARCH, 2018

Liabilities Rs. Assets Rs.

Capital Fund: Cash in hand 3,725

Opening Balance 11,925 Cash at bank 3,000

Add: Surplus 1,000 Outstanding Subscription:

Add: Life Membership for 2016-2017 50

subscription 100 13,025 for 2017-2018 450 500

Tournament Fund: Printing & Stationery:

Opening Balance Nil Opening Balance 200

Add: Subscription 1,500 Add: Purchases 100

Add: Interest on 300

Tournament Fund Less: Charged 75 225

Invest. [1500 x 12% x 75 Stock of Bats & Ball:

5/12]

Less: Tournament expenses 1,200 375 Opening Balance 1,500

Subscription for Governor’s Add: Purchases 700

Party Received 3,450 2,200

Add: Outstanding 550 4,000 Less: Charged 1,100 1,100

Outstanding Salaries 50 Books:

Advance Subscription 60 Opening Balance 500

Add: Additions 100 600

12% Investments 2,000

Furniture:

Opening Balance 600

Add: Additions 250

Less: Sale 100 750

Building 5,000

Accrued Interest:

on General Investments 12.5

on Tournament Fund

Investments 37.5 50

Outstanding subscription 550

for Governor’s Party

Prepaid Municipal Taxes 10

17,510 17,510
Working Note:
BALANCE SHEET OF TULIKA CLUB AS AT 31 ST MARCH, 2017

Liabilities Rs. Assets Rs.

Capital Fund (balancing figure) 11,925 Cash in hand 1,025

Cash at bank 3,000

O/s subscription (50 + 40) 90

Printing & Stationery 200

Stock of Bats & Balls 1,500

Books 500

Furniture 600

Building 5,000

Prepaid Municipal Taxes 10

11,925 11,925

Notes:
1. Since yearly municipal charges are Rs. 40, Rs. 10 must have been paid during
the previous year for current year.
2. Excess Prize Expenses have been charged to Income & Expenditure Account.

QUESTION 18
Dr Arun Gupta’s Receipts and Payments for the year ending on 31 st March 2018
was as follows:

Receipts Rs. Payments Rs.

To Balance b/d 66,100 By Rent (for 18 months to 45,000

30.6,2018)

To Fees 2,14,200 By Telephone Charges 4,500

To Miscellaneous Receipts 200 By Salaries to assistants 33,000

To Sale of old Equipment 4,000 By Journals etc. 1,000

By Library Books

(Purchased on 1.7,2017) 5,000

By Medical Equipments 8,000

 By Furniture

(Purchased on 1.10,2017) 7,000

By Purchases of Medicines 43,000

By Conveyance Expenses 50,000

By Drawings 60,000

By Misc. Expenses 1,000

By Balance c/d 27,000

2,84,500 2,84,500

Information:
(a) Fees outstanding: on 31.3,2017 Rs. 2,000, on 31.3,2018 Rs. 5,000
(b) Stock of Medicines: on 31.3,2017 Rs. 10,000, on 31.3,2018 Rs. 18,600
(c) Creditors for Medicines: on 31.3,2017 Rs. 100, on 31.3,2018 Rs. 300
(d) Medical Equipment on 31.3,2017 Rs. 50,000. Medical Equipment was sold as
well as purchased on 1st Jan. 2018. The book value of the equipment sold being
Rs. 6,000 as on 1.4,2017. Equipment is subject to depreciation @ 20% p.a.
(e) Furniture on 31.3,2017 Rs. 5,000, Library Books on 31.3,2017 Rs. 1,000
Depreciate furniture by 10% and Library Books by 20%.
(f) Salary to assistant still payable is Rs. 3,000.
(g) 40% of conveyance is for domestic purposes.
Required: Prepare the Receipts and Expenditure Account of Dr. Arun for the year
2017-2018 and the Balance Sheet as at 31.3,2018.
SOLUTION
RECEIPTS AND EXPENDITURE ACCOUNT OF DR. ARUN
Dr. for the year ending on 31st March, 2018 Cr.

Expenditure Rs. Receipts Rs.

To Medicine Consumed 34,600 By Fees 2,14,200

To Rent [ Rs. 45,000 x 12/18] 30,000 By Misc. Receipts 200

To Telephone charges 4,500

To Salaries to assistants paid

33,000

Add: O/s at the end 3,000 36,000

To Journals etc. 1,000

To Misc. Expenses 1,000

To Depreciation Medical Equipment 10,100

To Depreciation on Library Books 1,200

To Depreciation on furniture 1,200

To Loss on sale of Equipment 1,100

To Conveyance [60% of Rs.50,000] 30,000

To Surplus t/f to Capital Fund 63,700

2,14,400 2,14,400

BALANCE SHEET AS AT 31 ST MARCH, 2018

Liabilities Rs. Assets Rs.

Creditors for Medicines 300 Cash in hand 27,000

Salary outstanding 3,000 Medical Equipments 42,800

Capital Furniture 10,800

Opening Balance 1,24,500 Library Books 4,800

Add: Surplus 63,700 Stock of Medicines 18,600

1,88,200 Fees Outstanding 5,000

Less: Drawings Less: Provision against

Cash 60,000 Outstanding Fees 5,000 —

Conveyance 20,000 80,000 1,08,200 Prepaid Rent [ Rs. 45,000 7,500

x 3/18]

(40% of Rs. 50,000)

1,11,500 1,11,500

Working Notes:(I)
Notes:(I) BALANCE SHEET AS AT 31 ST MARCH, 2017

Liabilities Rs. Assets Rs.

Creditors for Medicines 100 Cash in hand 66,100

Rent Outstanding [ Rs. 45,000 x 7,500 Medical Equipment 50,000

3/18]

Capital (Balancing figure) 1,24,500 Furniture 5,000

 Library Books 1,000

Stock of Medicines 10,000

Fees Outstanding 2,000 Less:

Provision 2,000

1,32,100 1,32,100

Dr. (II) CREDITORS FOR MEDICINES ACCOUNT Cr.

Particulars Rs. Particulars Rs.

To Cash A/c 43,000 By Balance b/d 100

To Balance c/d 300 By Stock of Medicines A/c

(Purchases) 43,200

43,300 43,300

(III) STOCK OF MEDICINES ACCOUNT

Particulars Rs. Particulars Rs.

To Balance b/d 10,000 By Income & Expenditure A/c (b.f.) 34,600

To Creditors for Medicines A/c 43,200 By Balance c/d 18,600

53,200 53,200

Dr. (IV) MEDICAL EQUIPMENT ACCOUNT Cr.

Particulars Rs. Particulars Rs.

To Balance b/d 50,000 By Depreciation A/c 900

To Cash A/c (Purchases) 8,000 By Cash A/c (Sale Proceeds) 4,000

By Income & Expenditure A/c 1,100

(Loss) [( Rs. 6,000 - Rs. 900)
- Rs. 4,000]
By Depreciation A/c

on Rs. 44,000 for 1 year 8,800

on Rs. 8,000 for 1/4 year 400

By Balance c/d 42,800

58,000 58,000
 Cr.
Dr. (V) FURNITURE ACCOUNT

Particulars Rs. Particulars Rs.

To Balance b/d 5,000 By Depreciation A/c 1,200

To Cash A/c (Purchases) 7,000 By Balance c/d 10,800

12,000 12,000

Dr. (VI) LIBRARY BOOKS ACCOUNT Cr.

Particulars Rs. Particulars Rs.

To Balance b/d 1,000 By Depreciation A/c 1,200

To Bank A/c (Purchases) 5,000 By Balance c/d 4,800

6,000 6,000

Dr. (VII) PROVISION AGAINST OUTSTANDING FEES ACCOUNT Cr.

Particulars Rs. Particulars Rs.

To Fees A/c By Balance b/d 2,000

[Ope. Reserve no longer required] 2,000 By Fees A/c 5,000

To Balance c/d 5,000

7,000 7,000

Dr. (VIII) FEES ACCOUNT Cr.

Particulars Rs. Particulars Rs.

To Balance b/d 2,000 By Provision against outstanding

To Provision against outstanding fees A/c 2,000

fees A/c 5,000 By Cash A/c 2,14,200

To Income & Expenditure A/c (t/f) 2,14,200 By Balance c/d 5,000

2,21,200 2,21,200