Advertisement

Question 44 Chapter 1 of +2-A – T.S. Grewal 12 Class Part – A Vol. 1

Question 44 Chapter 1 of +2-A
Question No.44 - Chapter No.1 - T.S. Grewal +2 Book Part-A 2019-Solution-min-min

Advertisement

Question 44 Chapter 1 of +2-A

Advertisement

44. From the following Receipts and Payments Account and additional information is given below, prepare Income and Expenditure Account and Balance Sheet of Rural Literacy Society as on 31st March 2019

RECEIPTS AND PAYMENTS ACCOUNT for the year ended 31st March 2019
Receipts  Rs.PaymentsRs. 
To Balance b/d  By General Expenses  32,000
Cash in Hand 40,000By Newspapers18,500
Cash at Bank 1,55,500By Electricity30,000
To Subscriptions  By Fixed Deposit with Bank1,80,000
     2017-1812,000 (On 30th September, 2018@ 10%p.a.) 
     2018-192,65,000 By Books70,000
     2019-205,0002,82,000By Salary36,000
To Legacy 12,500By Rent65,000
To Government Grant 1,20,000By Postage Charges3,000
To Sale of Old Newspaper 37,000By Furniture (Purchased)1,05,000
      (Book value Rs 50,000)  By Balance C/d 
To Interest received on Fixed Deposit 4,500Cash in Hand30,000
   Cash at Bank82,000
  6,51,500 6,51,500

Additional Information:

  1. Subscription is Outstanding as on 31st March 2018 Rs 20,000 and on 31st March 2019 Rs 15,000.
  2. On31st March 2019 salary outstanding Rs 6,000 and one month rent paid in advance.
  3. On 1st April,2018, Society owned furniture Rs 1,20,000 and Books Rs 50,000.

The solution of Question 44 Chapter 1 of +2-A: –

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

AmountIncome
Amount
To General Expenses 32,000By Subscription 2018-192,65,000 
To Newspapers 18,500Add O/s Sub. for 2018 -19*7,0002,72,000
To Electricity Charges 30,000By Legacy 12,500
To Salaries36,000 By Government Grant 1,20,000
Add: – Closing O/s Salaries6,00042,000By Interest received on
Fixed Deposit
4,500 
To Rent65,000 Add O/s Sub. at the end*4,5009,000
Less: – Advance Rent*5,00060,000   
To Postage Charges 3,000   
To Loss on sale of Furniture* 13,000   
To Surplus(Balancing Figure) 2,15,000   
  4,13,500  4,13,500

 

Balance Sheet (for the year ended 31st March 2018)
Liabilities
AmountAssetsAmount
  Cash in Hand40,000
  Cash at Bank1,55,500
  Furniture1,20,000
  Books50,000
Capital Fund(Balancing Figure)3,85,500Outstanding Subscription20,000
 3,85,500 3,85,500

Advertisement-X

 

Balance Sheet (for the year ended 31st March 2018)
Liabilities
AmountAssetsAmount
Capital Fund3,85,500 Cash in Hand 30,000
Add: – Surplus2,15,0006,00,500Cash at Bank 82,000
Outstanding Salaries 6,000Furniture1,20,000 
Advance Subscription for 19-20 5,000Add: Purchased1,05,000 
   Less: Sale50,0001,75,000
   Books50,000 
   Add: Purchased70,0001,20,000
   Outstanding Subscription  
   2018-197,000 
   2017-188,00015,000
   Fixed Deposit with Bank 1,80,000
   Advance Rent 5,000
   Accrued Interest 4,500
  6,11,500  6,11,500

Working Note: –

Calculation of Total Interest on Investment
Interest on Investment = Value of Investment X Rate of Interest X Period
Value of Asset = 1,80,000
Rate of Interest = 10%
Period = from 01/10/18 to 31/03/19 i.e. 6 months
(from the date of purchase to the end of the financial year)
= 1,80,000 X 10/100 X 6/12
Total Interest on Investment = 9,000/-

Calculation of the Accrued amount of Interest on Investment 
Total Amount of Interest on Investment For the F/Y 19-209,000
Less: – Total Amount Interest on Investment received For the F/Y 19-204,500
Accrued amount of Interest on Investment For the F/Y 19-204,500

 

Calculation of the amount of Profit/loss on the sale of Furniture 
Sale Value of Furniture37,000
Less: – Book Value of Furniture50,000
Loss on sale of Furniture-13,000

 

Calculation of Advance rent at the end

Advertisement-X

Advertisement-Y

Rent paid during the year (let’s assume it, Rent is for 13 months because in additional information they wrote that one month of rent is paid in advance, So the Whole year + number Extra months for which rent is paid = 12 months + 1 Month = 13 Months). We have to divide the total rent paid with a total number of year for which rent is paid to calculate the amount for the 1 month.

= 65,000 x 1/13
Advance Rent = 5,000

Thanks, Please Like and share with your friends  

Comment if you have any questions.

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)

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

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

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

+2 Book 1-min
Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

Advertisement

Advertisement

error: Content is protected !!