Question 47 Chapter 1 of +2-A – T.S. Grewal 12 Class Part – A Vol. 1

Question 47 Chapter 1 of +2-A

Question 47 Chapter 1 of +2-A

47. From the following Receipts and Payments Account of Mumbai Theatre Club, prepare Income and Expenditure Account for the year ended 31st March 2019 and Balance Sheet as at that date:

RECEIPTS AND PAYMENTS ACCOUNT for the year ended 31st March 2019
Receipts  Rs. Payments Rs. 
To Balance b/d:   By Salary 20,000
Cash and Bank  1,40,000 By Repair Expenses 5,000
To Donations 50,000 By Furniture 60,000
To Subscriptions 1,20,000 By Miscellaneous Expenses 5,000
To Entrance Fees 10,000 By Investments 60,000
To Interest on Investments 1,000 By Insurance Premium 2,000
To Interest Received from Bank 4,000 By Billiard Table 80,000
To Sale of Old Newspapers 1,500 By Paper, Ink, etc. 1,500
To Sale of Drama Tickets 10,500 By Drama Expenses  5,000
    By Balance c/d:  
       Cash and Bank 98,500
  3,37,000   3,37,000

Additional Information:
(i) Subscriptions in arrear for the year ended 31st March 2019 ₹ 9,000 and subscriptions in advance for the year ending 31st March 2020 ₹ 3,500.
(ii) Insurance Premium outstanding ₹ 400.
(iii) Miscellaneous expenses prepaid ₹ 900.
(iv) 8% interest has accrued on investment for five months.
(v) Billiard Table costing ₹ 3,00,000 was purchased during last year and ₹ 2,20,000 were paid for it.

The solution of Question 47 Chapter 1 of +2-A

: –

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

Amount Income
Amount
To Salary   20,000 By Subscriptions *1 1,20,000  
To Repair Expenses   5,000 Add: Outstanding for 2018-19 9,000  
To Miscellaneous Expenses 5,000   Less: Adv. Sub. for 2019-20 3,500 1,25,500
Less: Prepaid Expenses 900 4,100 By Donations   50,000
To Insurance Premium 2,000   By Entrance Fees   10,000
Add: Outstanding Premium 400 2,400 By Interest on Investments 1,000  
To Paper, Ink, etc.   1,500 Add: Accrued Interest *2 2,000 3,000
To Drama Expenses.   5,000 By Interest received from Bank   4,000
      By Sale of Old Newspapers   1,500
      By Sale of Drama Tickets   10,500
To Surplus(Balancing Figure)   1,66,500      
    2,04,500   2,04,500

* Means: – see the working note for calculation

 

Balance Sheet (for the year ended 31st March 2018)
Liabilities
Amount Assets
Amount
Creditors for Billiard Table   80,000 Billiard Table 3,00,000
      Cash and Bank 1,40,000
         
Capital Fund (Balancing Figure)   3,60,000
 
   
    4,40,000     4,40,000

 

Balance Sheet (for the year ended 31st March 2018)
Liabilities
Amount Assets  Amount
Capital Fund   3,60,000   Furniture   60,000
Add: – Surplus   1,66,500 5,26,500 Investments   60,000
Outstanding Insurance Premium     400 Billiard Table   3,00,000
Advance Subscriptions     3,500 Prepaid Miscellaneous Expenses   900
        Accrued Interest on Investments   2,000
        Outstanding Subscriptions   9,000
        Cash and Bank   98,500
             
  5,30,400   5,30,400

Working Note: –
*1: – Calculation of Amount of Subscriptions

Subscription received During the year 1,20,000
Add: – Subscription outstanding at the end of the year 9,000
Subscription received in advance at the beginning of the year
  1,29,000
Less: – Subscription outstanding at the beginning of the year
Subscription received in advance at the end of the year 3,500
The amount for subscription credited to the Income and Expenditure A/c 1,25,500

*2: – Calculation of Total Interest on Investment
Interest on Investment = Value of Investment X Rate of Interest X Period
Value of Asset = 60,000
Rate of Interest = 8%
Period = 5 months(given in additional information)
= 60,000 X 8/100 X 5/12
Total Accrued Interest on Investment = 2,000/-

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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)

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

 

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2 Book 1 min - Question 47 Chapter 1 of +2-A - T.S. Grewal 12 Class Part - A Vol. 1
Vol. I: Accounting for Not-for-Profit Organizations and Partnership Firms

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