Question 36 Chapter 1 of Class 12 Part - 1 VK Publication

Question 36 Chapter 1 of Class 12 Part – 1

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The solution of Question 36 Chapter 1 of Class 12 Part – 1: –

Usha Publication – Accountancy PSEB (Class 12) – Volume I – Solution

Usha Publication – Accountancy PSEB (Class 12) – Volume II – Solution

36. From the following information and Receipts and Payments Account of Patiala Club. Prepare an Income and Expenditure Account for the year ending 31st March, 2018 a Balance Sheet as at that date:

Receipt and Payments Account (An Extract)
For the year ended 31st March, 2018

Receipts	Rs.	Payments	Rs.
To Balance b/d	3,190	By Rent	1,680
To Entrance Fees	550	By Wages	2450
To Subscriptions	18,000	By Electricity Charges	720
To Donations	1,650	By Books purchased	2,480
To Life Membership Fees	2,500	By Office Expenses	4,500
To Interest on Deposits	240	By 8% Fixed Deposit (on 1st Oct., 2017)	12,000
To Proceeds of Tournament	2,320	By Tournament Expenses	2,000
		By Balance c/d	260
	28,450		28,450

Additional Information:
On 31st March 2017, the Club possessed books worth Rs. 20,000 and furniture Rs. 8,500 Provide depreciation on these assets @10% including the purchases during the year.
Subscriptions in arrears at the beginning of the year amounted to Rs. 350 at end of the year Rs. 550 were outstanding.
The Club paid, three months rent in advance both in the beginning and at the end of the year.

The solution of Question 36 Chapter 1 of Class 12 Part – 1: –

Income and Expenditure Account

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For the year ended on 31st March, 2018

Expenditure		Amount	Income		Amount
To Rent			By Entrance fees		550
Add: Prepaid in the beginning	1680		By Subscriptions	18,000
Less: Prepaid at the end	420		Less. Outstanding in the beginning	(350)
To Wages	(420)	1,680	Add: Outstanding at the end	550	18,200
To Electricity charges		2,450	By Donations		1,650
To Office Expenses		720	By Interest on Deposits	240
To Tournament Expenses		4,500	Add: Accrued Interest	240	480
To Depreciation on	2,020		By Proceeds of Tournament		2,320
Books	2248
Furniture	850	3,098
To Surplus, i.e., Excess of income over Expenditure		8,732
		23,200			23,200

Balance Sheet (as at 31st March 2018)

Liabilities		Amount	Assets		Amount
Life Membership Fees		2,500	Cash in hand		2,600
Capital Fund	32,460		Outstanding Subscriptions		550
Add: Surplus	8,732	41,192	Fixed Deposit	12,000
			Add: Accrued Interest	240	12,240
			Furniture	8,500
			Less: Depreciation	850	7,650
			Books (20,000+2,480)	22,480
			Less: Depreciation	2,248	20,232
			Prepaid Rent		420
		43,692			43,692

Working Notes:
I. Interest on Fixed Deposits = Rs. 12,000 x8/100 X 6/12 = Rs. 480
Accrued Interest on Deposits = 480 -240 (Received) = Rs. 240
2. Calculation of Opening Capital Fund

Balance Sheet (as at 31st March 2017)

Liabilities	Amount	Assets	Amount
Capital Fund (Balancing Figure)	32,460	Cash in hand	3,190
		Outstanding Subscriptions	350
		Furniture	8,500
		Books	20,000
		Prepaid Rent	420
	32,460		32,460