Question 38 Chapter 1 – Unimax Class 12 Part 1 – 2021

Question 38 C0hapter 1 - Unimax Class 12 Part 1 - 2021

Question 38 Chapter 1 – Unimax Class 12 Part 1

38. The following is the Receipts and Payments Account of Sydney Club for the year ended on 31.3.2021

Receipts Amount Payments   Amount
To Opening Balance Cash 10,000 By entrance donation refund   20,000
Bank 3850 By Salaries   1,20,000
To Subscription received 2,02,750 By Creditors for supplies   15,20,000
To Entrance donation 1,00,000 By Printing and Stationery   70,000
To Interest received 58,000 By Postage   40,000
To Sale of assets 8,000 By Telephone and telex   52,000
To Miscellaneous income 9,000 By Repairs and maintenance   48,000
To Receipts at :   By Glass and table linen   12000
Coffee room 10,70,000 By Crockery and cutlery   14,000
Wines and spirits 5,10,000 By Garden upkeep   8000
Swimming pool 80,000 By Membership fees   4,000
Tennis court 1,02,000 By Insurance   5,000
    By Electricity   8000
    By Closing Balance : Cash 8,000 2,32,600
    Bank 2,24,600  
  21,53,600     21,53,600

The assets and liabilities as on 31.3.2020 were as follows :
Fixed assets (net) : Rs. 5,00,000, Stock of Supplies Rs. 3,80,000, Investment in government securities Rs. 5,00,000, outstanding subscription Rs. 12,000, prepaid insurance Rs. 1,000, Sundry creditors for supplies Rs. 1,12,000, subscription received in advance Rs. 15,000, entrance donation received pending membership Rs. 1,00,000, Gratuity fund Rs. 1,50,000.
The following adjustments are to be made while drawing up the accounts :
(a) Subscription received in advance as on 31st March, 2021 was Rs. 18,000.
(b) Outstanding Subscription as on 31st March, 2021 was Rs. 7,000.
(c) Outstanding expenses are : salaries Rs. 8,000 and Electricity Rs. 15,000.
(d) 50% of the entrance donation was to be capitalized. There was no pending membership as on 31st March, 2021.
(e) The cost of assets sold net as on 1.4.20 was Rs. 10,000.
(f) Depreciation is to be provided at the rate of 10% on assets.
(g) A sum of Rs. 20,000 received in October 2020 as entrance donation from an applicant was to be refunded as he had not fulfilled the requisite membership qualifications. The refund was made on 31.3.2021.
(h) The value of closing stock of supplies was Rs. 2,10,000.
(i) 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.
Prepare an income and expenditure account for the year ended 31st March, 2021 and the balance sheet as on 31st March, 2021 along with necessary workings.

The solution of Question 38 Chapter 1 – Unimax Class 12 Part 1: 

Working Notes :
(1) Calculation of Capital Fund on 1
st April, 2011.

Balance Sheet of Sydney Club For the year ended 31 March, 2011

Liabilities Amount Assets Amount
Creditors 112000 Cash 10000
Prereceived Subscription 15000 Bank 3850
Entrance donations rect. In adv. 100000 Fixed Assets 500000
Gratunity fund 150000 Stock of Supplies 380000
Capital fund –    Investments 500000
(Balancing Figure) 1029850 Outstanding Subscription 12000
    Prepaid Insurance 1000
  1406850   1406850

 (2) Calculation of Income from the Subscription for the year ended 31st March, 2012.

Subscription received during the year   202750
Add Outstanding subscription on 31-3-12   7000
Add Prereceived subscription on 31-3-11   15000
    224750
Less: Outstanding subscription on 1-4-11 12000  
Less: Prereceived subscription on 31-3-12 18000 30000
Income for the year from subscription   194750

 (3) Calculation of purchases and consumption of supplies for the year ended 31-3-12.

Total Creditors Account

Particulars Amount Particulars Amount
To cash a/c 1520000 By Balance b/d 112000
To Balance c/d Nil By Purchases (B/f) 1408000
  1520000   1520000

Consumption :

Opening Stock on 1-4-11 380000
Add purchases made during the year 1408000
  1788000
Less Stock as on 31-3-12 210000
Consumption of supplies 1578000

(4) Calculation of Expenditure on salaries for the year ended 31-3-12

Payment for salaries made during the year 120000
Add outstanding as on 31-3-12 8000
Expenditure for the year 128000

(5) Calculation of Expenditure on Insurance for the year ended 31-3-12

Payment made during the year 5000
Add prepaid as on 1-4-11 1000
Expenditure for the year 6000

 (6) Calculation of Expenditure on Electricity charges for the year ended 31-312

Paid during the year  
Add outstanding as on 31-3-12 15000
Expenditure for the year 23000

 (7) Calculation of loss on the sale of Fixed Asset :

Book value of Asset sold 10000
Amount at which asset sold 8000
Loss on Sale of Asset 2000

 (8) Calculation of Entrance Donations to be Capitalised.

50% of Entrance Donations (1.4.11)
As on 1-4-2011
(Rs. 100,000 x 50/100)
  50000
Entrance donation received during 2011-12 100000  
Less Amount refunded 20000  
  80000  
Less Treated As income (80000 x 50/100) 40000 40000
Total Amount of Entrance   90000
Donations to be Capitalised    

 (9) Calculation of Entrance Donations treated as income for the year 2011-12.

50% of Entrance Donations
As on 1-4-2011
(Rs. 100,000 x 50/100)
50000
50% of Net Entrance Donations received during 2011-12 40000
Entrance Donations to be treated as income for the year 2011-12 90000

In the Books of Sudney Club. Income and Expenditure account
For the year ended 31st March, 2012

Particulars Amount Particulars Amount
To Salaries 128000 By subscription 194750
To consumption of Supplies 1578000 By Entrance donation 90000
To printing & Stationery 70000 By Interest received 58000
To Postage 40000 By Miscellaneous income 9000
To telephone and telex 52000 By Receipt at  
To Repairs and maintenance 48000 Coffee room 1070000
To glass & table lenin 12000 Withs & spoils 510000
To Crockery & cutlery 14000 Swimming pool 80000
To garden up keep 8000 Tennis Court 102000
To Membership fees 4000    
To Insurance 6000    
To Electricity 23000    
To Depreciation
(500000 – 10000 x 10/100)
49000    
To Loss on sale of Fixed Asset 2000    
To Surplus 79750    
  2113750   2113750

Balance Sheet of M/s Sydney Club As on 31st March, 2012

Liabilities   Amount Assets   Amount
Outstanding Expenses   23000 Cash   8000
Salaries 8000   Bank   224600
Electricity 15000   Outstanding Subscription   7000
Pre received Subscription   18000 Stock of supplies   210000
Gratuity fund   150000 Investments   500000
Capital fund 1029850   Fixed Assets 490000  
Add Surplus 79750   Less dep. @ 10% 49000 441000
Add Entrance Donation 90000 1199600      
    1390600     1390600

https://tutorstips.com/not-for-profit-organisations/

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

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

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