Question 50 Chapter 1 of +2-A – T.S. Grewal 12 Class Part – A Vol. 1

Question 50 Chapter 1 of +2-A

Question 50 Chapter 1 of +2-A

50. From the following Receipts and Payments Account of Kapil Dev Club and from the given additional information, prepare Income and Expenditure Account for the year ending 31st December 2019 and the 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 1,90,000 By Salaries 3,30,000
To Subscriptions 6,60,000 By Sports Material 4,00,000
To Interest on Investment 40,000 By Balance c/d 1,60,000
    @ 8% p.a. for full year      
  8,90,000   8,90,000

Additional Information:
(i) The club had received ₹ 20,000 for subscription in 2017-18 for 2018-19.
(ii) Salaries had been paid only for 11 months.
(iii) The stock of sports materials on 31st March 2018 was ₹ 3,00,000 and on 31st March 2019 ₹ 6,50,000.

The solution of Question 50 Chapter 1 of +2-A

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

Amount Income
Amount
To Salaries 3,30,000   By Subscriptions 6,60,000 2,50,000
Add: Outstanding Salary *1 30,000 65,000 Add: Advance in the beginning 20,000 54,000
To Sports Materials Consumed*2   50,000 By Interest on Investments *3   40,000
To Surplus(Balancing Figure)   3,10,000      
    3,63,500   3,63,500

* Means: – see the working note for calculation

Balance Sheet (for the year ended 31st March 2019)
Liabilities
Amount Assets
Amount
Capital Fund *4 9,70,000   Investments 5,00,000
Add: – Surplus 3,10,000 12,80,000 Stock of Sports Material 6,50,000
      Cash 1,60,000
Outstanding Salary   30,000


   
    13,10,000     13,10,000

* Means: – see the working note for calculation

Working Note: –

*1:- Statement Showing Sports Material used during the year
Particulars
Details Amount
Sports Material Purchased during the year ended 31st March 2019     4,00,000
Add: – Opening Stock of Sports Material   3,00,000  
Closing Creditors for Sports Material    
Cash Purchase of Sports Material   3,00,000
Outstanding Advertisement Exp.     7,00,000
Less: – Closing Sports Material   6,50,000  
Opening Creditors for Sports Material    
Book Value of sale of Sports Material   6,50,000
Amount of Sports Material used – debited to the Income and Expenditure A/c   50,000

*2:- Calculation of Outstanding Salary

O/s Salaries  = Total salary paid X No. of Month for which not paid
Total No. of the month for which salary paid

 

O/s Salaries  = 3,30,000  X 1
11

O/s Salaries = 5,000/-


*3:- Calculation of the amount of Investment:

 = amount of Interest  X 100
Rate of Interest

 

 = 40,000  X 100
8

Total on Investment = 5,00,000/-

Balance Sheet (for the year ended 31st March 2018)
Liabilities
Amount Assets
Amount
Advanced Subscription   20,000 Investments 5,00,000
      Stock of Sports Material 3,00,000
      Cash 1,90,000
Capital Fund (Balancing Figure)  

9,70,000

   
    9,90,000     9,90,000


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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 50 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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