Q.No.54 | Chapter 1 – Financial Statements of Not-for-Profit Organisations | T.S. Grewal 12 Class Book Keeping Part - A - Vol. 1

Question 54 Chapter 1 of +2-A

54. Following is the Receipt and Payment Account of Women's Welfare Club for the year ended 31st March 2019:

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

Receipts	Rs.	Payments	Rs.
To Cash in Hand	22,500	Salary	1,25,000
To Cash at Bank	50,000	By Stationery	17,000
To Subscriptions	8,17,500	By Electric Charges	95,500
To Donations	30,000	By Insurance	75,000
To Government Grant	1,50,000	By Equipment	3,00,000
To Sale of Newspapers	3,000	By Petty Expenses	5,000
To Proceeds of Charity Show	1,65,000	By Expenses on Charity Show	1,29,000
To Interest on Investments @ 10% for full-year	70,000	By Newspapers	10,000
To Sundries Income	4,000	By Lectures Fee	1,65,000
		By Honorarium to the secretary	1,20,000
		By Cash in Hand	20,500
		By Cash at Bank	2,50,000
	13,12,000		13,12,000

Additional Information:

Particulars	1st April 2018	31st March 2019
	(₹)	(₹)
Outstanding Salaries	12,000	18,000
Insurance Prepaid	7,000	3,000
Subscription Outstanding	37,500	25,000
Subscription received in advance	17,500	10,000
Electricity Charges outstanding	...	12,500
Stock of Stationery	22,500	7,000
Equipment	2,56,000	5,02,000
Building	12,00,000	11,40,000

Prepare Income and Expenditure Account for the year ended 31st March, 2019,and Balance Sheet as on that date.

The solution of Question 54 Chapter 1 of +2-A: 

Books of Rama Krishna Mission Charitable Hospital Income and Expenditure Account (for the year ended 31st March 2019)

Expenditure		Amount	Income			Amount
To Stationery		32,500	By Subscriptions *1		8,17,500
To Electricity Charges	95,500		Add: O/s at the end		25,000
Add: O/s at the end	12,500	1,08,000	Adv. in the Beginning		17,500
To Salary	1,25,000		Less: O/s in the Beginning		37,500
Add: O/s at the end	18,000		Adv. at the end		10,000	8,12,500
Less: O/s Beginning	12,000	1,31,000	By Donations			30,000
To Insurance	75,000		By Government Grant			1,50,000
Add: O/s at the end	7,000		By Sale of Old Newspapers			3,000
Less: O/s Beginning	3,000	79,000	By Income from Charity Show
To Petty Expenses		5,000	Proceeds of Charity Show		1,65,000
To Newspaper		10,000	Less: O/s in the Beginning		1,29,000	36,000
To Lectures Fees		1,65,000	By Interest on Investments			70,000
To Honorarium to Secretary		1,20,000	By Sundries Income			4,000
To Depreciation on Equipment *2		54,000
To Depreciation on Building*3		60,000
By Surplus (Balancing Figure)		3,41,000
		7,99,500				7,99,500

* Means: - see the working note for calculation

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

Liabilities	Amount	Assets		Amount
Outstanding Salary	12,000	Prepaid Insurance		7,000
Subscription Received in Advance	17,500	Subscription Outstanding		37,500
		Stock of Stationery		22,500
		Equipment		2,56,000
		Building		12,00,000
Capital Fund(Balancing Figure)	22,66,000	Cash		22,500
		Bank		50,000
		10% Investments *4		7,00,000
	22,95,500			22,95,500

 

Balance Sheet (for the year ended 31st March 2019)

Liabilities		Amount	Assets			Amount
Capital Fund	22,66,000	1,000	Prepaid Insurance			3,000
Add: Surplus	3,41,000	26,07,000	Subscription Outstanding			25,000
Outstanding Salary		18,000	Stock of Stationery			7,000
Subscription Received in Advance		10,000	Equipment		2,56,000
Electricity Charges Outstanding		12,500	Add: Purchases		3,00,000	3,16,000
			Less: Depreciation *2		54,000	5,02,000
			Building		12,00,000
			Less: Depreciation *3		60,000	11,40,000
			Cash			20,500
			Bank			2,50,000
			10% Investments *1			7,00,000
		26,47,500				26,47,500

* Means: - see the working note for calculation

Working Note: -

*1:- Calculation of Amount of Subscriptions

Subscription received During the year	8,17,500
Add: - Subscription outstanding at the end of the year	25,000
Subscription received in advance in the beginning of the year	17,500
	8,60,000
Less: - Subscription outstanding in the beginning of the year	37,500
Subscription received in advance at the end of the year	10,000
The amount for subscription credited to the Income and Expenditure A/c	8,12,500

*2:- Calculate Depreciation on Equipment
Depreciation = Opening Balance of Equipment + Equipment Purchased During the year – Closing Balance of Equipment
Opening Balance of Equipment = 2,56,000
Closing Balance of Equipment = 5,02,000
Equipment Purchased During the year = 3,00,000
= 2,56,000 + 3,00,000 – 5,02,000
Depreciation = 54,000


*3:- Calculate Depreciation on Building
Depreciation = Opening Balance of Building + Building Purchased During the year – Closing Balance of Building
Opening Balance of Building = 12,00,000
Closing Balance of Building = 11,40,000
Building Purchased During the year = 0
= 12,00,000 + 0 – 11,40,000
Depreciation = 60,000


*4:- Calculation of the amount of Investment X

= amount of Interest	X	100
		Rate of Interest

 

70,000	X	100
		10

Total on Investment = 7,00,000/-

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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

Check out T.S. Grewal +2 Book 2020@ Official Website of Sultan Chand Publication