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

Question 47 Chapter 1 of +2-A
Question No.47 - Chapter No.1 - T.S. Grewal +2 Book Part-A 2019-Solution-min-min

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Question 47 Chapter 1 of +2-A

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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.PaymentsRs. 
To Balance b/d: By Salary20,000
Cash and Bank 1,40,000By Repair Expenses5,000
To Donations50,000By Furniture60,000
To Subscriptions1,20,000By Miscellaneous Expenses5,000
To Entrance Fees10,000By Investments60,000
To Interest on Investments1,000By Insurance Premium2,000
To Interest Received from Bank4,000By Billiard Table80,000
To Sale of Old Newspapers1,500By Paper, Ink, etc.1,500
To Sale of Drama Tickets10,500By Drama Expenses 5,000
  By Balance c/d: 
     Cash and Bank98,500
 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

AmountIncome
Amount
To Salary 20,000By Subscriptions *11,20,000 
To Repair Expenses 5,000Add: Outstanding for 2018-199,000 
To Miscellaneous Expenses5,000 Less: Adv. Sub. for 2019-203,5001,25,500
Less: Prepaid Expenses9004,100By Donations 50,000
To Insurance Premium2,000 By Entrance Fees 10,000
Add: Outstanding Premium4002,400By Interest on Investments1,000 
To Paper, Ink, etc. 1,500Add: Accrued Interest *22,0003,000
To Drama Expenses. 5,000By Interest received from Bank 4,000
   By Sale of Old Newspapers 1,500
   By Sale of Drama Tickets 10,500
To Surplus(Bal Fig.) 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
AmountAssets
Amount
Creditors for Billiard Table80,000Billiard Table3,00,000
  Cash and Bank1,40,000
    
Capital Fund (Balancing Figure)3,60,000
 
  
 4,40,000  4,40,000

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Balance Sheet (for the year ended 31st March 2018)
Liabilities
AmountAssets Amount
Capital Fund3,60,000 Furniture 60,000
Add: – Surplus1,66,5005,26,500Investments 60,000
Outstanding Insurance Premium 400Billiard Table 3,00,000
Advance Subscriptions 3,500Prepaid 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 year1,20,000
Add: – Subscription outstanding at the end of the year9,000
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 year3,500
The amount for subscription credited to the Income and Expenditure A/c1,25,500

*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)

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)

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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

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