Question 45 Chapter 1 of +2-A - T.S. Grewal 12 Class Part

Question 45 Chapter 1 of +2-A – T.S. Grewal 12 Class Part – A Vol. 1

By Shubham Sharma 10 Min Read September 8, 2022

Question No.45 - Chapter No.1 - T.S. Grewal +2 Book Part-A 2019-Solution-min-minQuestion No.45 - Chapter No.1 - T.S. Grewal +2 Book Part-A 2019-Solution-min-min

Question 45 Chapter 1 of +2-A

Table of Contents

The solution of Question 45 Chapter 1 of +2-A: –

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)

45. Glaxo Club’s Balance Sheet as at 1st April 2018 was as under:

Liabilities	Rs.	Assets	Rs.
Capital Fund	2,00,000	Sports Equipment	50,000
Tournament Fund	60,000	Grounds	1,20,000
Subscriptions in Advance	6,000	Billiards Tables	60,000
Salaries Unpaid	11,000	Subscriptions Outstanding	8,000
		Cash and Bank Balances	39,000
	6,51,500		6,51,500

RECEIPTS AND PAYMENTS ACCOUNT for the year ended 31st March 2019
Receipts	Rs.	Payments	Rs.
To Opening Balance	39,000	By Wages and Salaries	60,000
To Subscriptions	1,81,000	By Upkeep of Grounds	10,000
To Sale of Old Materials	1,500	By Stationery	15,000
To Sale of Sports Equipment	6,000	By Audit fee	2,000
(Book Value Rs 10,000)		By Expenses on Tournament	65,000
To Entrance fees	2,000	By Sports Equipment	20,000
To Life Membership Fees	50,000	By 5% Investments	40,000
To Donations for Tournament	20,000	(On 1st October 2018)
		By Cash and Bank Balances	87,500
	6,51,500		6,51,500

Additional Information:

Subscriptions still to be received are Rs 5,500 but subscriptions already received include Rs 4,000 for next year. Salaries still unpaid are Rs 6,000. Sports Equipment is now valued at Rs 45,000. Prepare Income and Expenditure Account and the Balance sheet, after charging 10% depreciation on Billiards Tables.

The solution of Question 45 Chapter 1 of +2-A: –

Income and Expenditure Account (for the year ended 31st March 2019)
Expenditure		Amount	Income		Amount
To Wages and Salaries	60,000		By Subscription 2018-19*	1,81,000
Add: – Closing Unpaid Salaries	6,000		Add O/s Sub. at the end	5,500
Less: – Opening Unpaid Salaries	11,000	55,000	Adv. Sub. In the Beginning	6,000
To Upkeep of Grounds		10,000	Less: O/s. Sub. In the Beginning	8,000
To Stationery		15,000	Adv. Sub. at the end	4,000	1,80,500
To Audit fee		2,000	By Sale of Old Materials		1,500
To Loss on sale of Sports Equipment*		4,000	By Entrance Fees		2,000
To Consumption of Sport Equipment*		15,000	By Accrued Interest on investment*		1,000
To Depreciation on Billiards Tables*		6,000
To Surplus(Balancing Figure)		78,000
		1,85,000			1,85,000

Balance Sheet (for the year ended 31st March 2018)
Liabilities		Amount	Assets		Amount
Capital Fund	2,00,000		Cash in Hand		87,500
Add: – Surplus	78,000	2,78,000	Cash at Bank		45,000
Outstanding Salaries		6,000	Grounds		1,20,000
Advance Subscription for 19-20		4,000	Billiards Tables	60,000
Tournament Fund*		15,000	Less: Depreciation	6,000	54,000
Life Membership Fees		50,000	Outstanding Subscription		5,500
			5% of Investments		40,000
			Accrued Interest		1,000
		3,53,000			3,53,000

Working Note: –
Calculation of Amount of Subscriptions

Subscription received During the year	1,81,000
Add: – Subscription outstanding at the end of the year	5,500
Subscription received in advance at the beginning of the year	6,000
	1,92,500
Less: – Subscription outstanding at the beginning of the year	8,000
Subscription received in advance at the end of the year	4,000
The amount for subscription credited to the Income and Expenditure A/c	1,80,500

Calculation of Total Interest on Investment
Interest on Investment = Value of Investment X Rate of Interest X Period
Value of Asset = 40,000
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)
= 40,000 X 10/100 X 6/12
Total Interest on Investment = 1,000/-

Calculation of the Accrued amount of Interest on Investment
Total Amount of Interest on Investment For the F/Y 19-20	1,000
Less: – Total Amount Interest on Investment received For the F/Y 19-20	0
Accrued amount of Interest on Investment For the F/Y 19-20	1,000

Advertisement-X

Calculation of the amount of Profit/loss on the sale of Sports Equipment
Sale Value of Sports Equipment	6,000
Less: – Book Value of Sports Equipment	10,000
Loss on sale of Sports Equipment	– 4,000

Calculation of the amount of consumption of Sports Equipment
Opening Balance of Sports Equipment	50,000
Add: – Purchase of Sports Equipment during the year	20,000
Less: – Book Value of Sports Equipment	10,000
	60,000
Less: – Closing Value of Sports Equipment	45,000
Loss on sale of Sports Equipment	15,000

Calculate Depreciation on Billiards Table
Depreciation = Value of Asset X Rate of Depreciation X Period
Value of Asset = 60,000
Rate of Depreciation = 10%
Period = from 01/04/18 to 31/03/19 i.e. 12 months
(from the date of purchase/Beginning balance to the end of the financial year)
= 60,000 X 10/100 X 12/12
Depreciation = 6,000/-

Calculate Tournament Fund
Opening Tournament Fund	60,000
Add: – Received Donation for tournament	20,000
Less: – Tournament Expenses	65,000
Closing Tournament Fund	15,000