Q.No.47 | Chapter 1 – Financial Statements of Not-for-Profit Organisations | T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1

Question 47 Chapter 1 of +2-A

47. From the following Receipts and Payments Account of Mumbai Theatre Club, prepare Income and Expenditure Account for the year ended 31st March 2019 and Balance Sheet as at that date:

RECEIPTS AND PAYMENTS ACCOUNT for the year ended 31st March 2019

Receipts	Rs.	Payments	Rs.
To Balance b/d:		By Salary	20,000
Cash and Bank	1,40,000	By Repair Expenses	5,000
To Donations	50,000	By Furniture	60,000
To Subscriptions	1,20,000	By Miscellaneous Expenses	5,000
To Entrance Fees	10,000	By Investments	60,000
To Interest on Investments	1,000	By Insurance Premium	2,000
To Interest Received from Bank	4,000	By Billiard Table	80,000
To Sale of Old Newspapers	1,500	By Paper, Ink, etc.	1,500
To Sale of Drama Tickets	10,500	By Drama Expenses	5,000
		By Balance c/d:
		Cash and Bank	98,500
	3,37,000		3,37,000

Additional Information:
(i) Subscriptions in arrear for the year ended 31st March 2019 ₹ 9,000 and subscriptions in advance for the year ending 31st March 2020 ₹ 3,500.
(ii) Insurance Premium outstanding ₹ 400.
(iii) Miscellaneous expenses prepaid ₹ 900.
(iv) 8% interest has accrued on investment for five months.
(v) Billiard Table costing ₹ 3,00,000 was purchased during last year and ₹ 2,20,000 were paid for it.

The solution of Question 47 Chapter 1 of +2-A: -

Income and Expenditure Account (for the year ended 31st March 2019)

Expenditure		Amount	Income			Amount
To Salary		20,000	By Subscriptions *1		1,20,000
To Repair Expenses		5,000	Add: Outstanding for 2018-19		9,000
To Miscellaneous Expenses	5,000		Less: Adv. Sub. for 2019-20		3,500	1,25,500
Less: Prepaid Expenses	900	4,100	By Donations			50,000
To Insurance Premium	2,000		By Entrance Fees			10,000
Add: Outstanding Premium	400	2,400	By Interest on Investments		1,000
To Paper, Ink, etc.		1,500	Add: Accrued Interest *2		2,000	3,000
To Drama Expenses.		5,000	By Interest received from Bank			4,000
			By Sale of Old Newspapers			1,500
			By Sale of Drama Tickets			10,500
To Surplus(Bal Fig.)		1,66,500
		2,04,500				2,04,500

* Means: - see the working note for calculation

Balance Sheet (for the year ended 31st March 2018)

Liabilities	Amount	Assets		Amount
Creditors for Billiard Table	80,000	Billiard Table		3,00,000
		Cash and Bank		1,40,000
Capital Fund (Balancing Figure)	3,60,000
	4,40,000			4,40,000

 

Balance Sheet (for the year ended 31st March 2018)

Liabilities		Amount	Assets			Amount
Capital Fund	3,60,000		Furniture			60,000
Add: - Surplus	1,66,500	5,26,500	Investments			60,000
Outstanding Insurance Premium		400	Billiard Table			3,00,000
Advance Subscriptions		3,500	Prepaid Miscellaneous Expenses			900
			Accrued Interest on Investments			2,000
			Outstanding Subscriptions			9,000
			Cash and Bank			98,500
		5,30,400				5,30,400

Working Note: -
*1: - Calculation of Amount of Subscriptions

Subscription received During the year	1,20,000
Add: - Subscription outstanding at the end of the year	9,000
Subscription received in advance at the beginning of the year	-
	1,29,000
Less: - Subscription outstanding at the beginning of the year	-
Subscription received in advance at the end of the year	3,500
The amount for subscription credited to the Income and Expenditure A/c	1,25,500

*2: - Calculation of Total Interest on Investment
Interest on Investment = Value of Investment X Rate of Interest X Period
Value of Asset = 60,000
Rate of Interest = 8%
Period = 5 months(given in additional information)
= 60,000 X 8/100 X 5/12
Total Accrued Interest on Investment = 2,000/-

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Also, Check out the solved question of previous Chapters: -

T.S. Grewal’s Double Entry Book Keeping +2 (Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms)

• Chapter No. 1 - Financial Statement of Not-For-Profit Organisations
• Chapter No. 2 - Accounting for Partnership Firms - Fundamentals
• Chapter No. 3 - Goodwill: Nature and Valuation
• Chapter No. 4 - Change in Profit-Sharing Ratio Among the Existing Partners
• Chapter No. 5 - Admission of a Partner
• Chapter No. 6 - Retirement/Death of a Partner
• Chapter No. 7 - Dissolution of a Partnership Firm

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

• Chapter No. 8 - Company Accounts -  Accounting for Share Capital
• Chapter No. 9 - Company Accounts - Issue of Debentures
• Chapter No. 10 - Redemption of Debentures

T.S. Grewal’s Double Entry Book Keeping (Vol. II: Accounting for Companies)

• Chapter No. 1 - Financial Statements of a Company
• Chapter No. 2 - Financial Statement Analysis 
• Chapter No. 3 - Tools of Financial Statement Analysis - Comparative Statements and Common- Size Statements
• Chapter No. 4 - Accounting Ratios
• Chapter No. 5 - Cash Flow Statement

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