Numerical Questions Solutions

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Numerical Questions Solutions
1. From the following particulars taken from the Cash Book of a health club, prepare a Receipts and Payments Account.

2. The Receipt and Payment Account of Harimohan charitable institution is given:
Receipt and Payment Account for the year ending March 31, 2015
Prepare the Income and Expenditure Account for the Year ended on March 31, 2015 after considering the following:
(i)
Liabilities to be provided for are:
Rent ₹ 800; Salaries ₹ 1,200; advertisement ₹ 200.
(ii)
₹ 2,000 due for interest on investment was not actually received.

Note: The payments for Furniture, Investments and Advance for building are capital in nature. So, they are not entered in the Income and Expenditure Account. Similarly, the Cash at Bank, Cash in Hand, Endowment Fund, Donation for building, Legacy for building are receipts which are capital in nature. So, they are not entered in the Income and Expenditure Account.

3. From the following particulars, prepare Income and Expenditure account:
Note: Purchase of books is capital expenditure. So, only the cost of periodical is consider as it is revenue expenditure. So,
Cost of Periodicals
=
Total Cost – Cost of Books
=
₹ 40,000 – ₹ 31,000
=
₹ 9,000

4. Following is the information given in respect of certain items of a Sports Club. Show these items in the Income and Expenditure Account and the Balance Sheet of the Club:
Expenditure
Amount
Income
Amount
By Interest on General Fund Investments
8,000
Balance Sheet of Sports Club
for the year ending March 31, 2016
Liabilities
Amount
Assets
Amount
Sports Fund
35,000
Sports Fund Investments
35,000
Interest on Sports Fund
4,000
General Fund Investments
80,000
39,000
Donations for Sports Fund
15,000
54,000
Sports Prizes awarded
(10,000)
44,000
Expenses on Sports Events
(4,000)
40,000
General Fund
80,000

5. How will you deal with the following items while preparing for the Bombay Women Cricket Club its income and expenditure account for the year ending 31.3.2017 and its Balance Sheet as on 31.3.2017:
(a)
Donation received during the year for the construction of a permanent Pavilion
12,25,000
Expenditure incurred up to 31.3.2017 on its construction
10,80,000
The total estimated expenditure on construction of Pavilion being
25,00,000
(b)
Tournament Fund:
Balance as on 1.4.2016
10,700
Subscriptions for tournament received during the year
65,800
Expenditure incurred during the year on conducting tournaments
72,400
(c)
Life Membership fee received during the year
28,000
Give reasons for your answers.
Reasining for (a): As the donation received for the construction of pavilion is Specific Donation i.e. For the construction of pavilion. So, it should be capitalised and will not be shown in the Income and Expenditure account. It should be shown on the Liabilities side of the Balance Sheet along with its expenses.
Reasining for (b): Tournament fund is fund for specific purpose and should be capitalised. So, it should be capitalised and will not be shown in the Income and Expenditure account. It should be shown on the Liabilities side of the Balance sheet along with its expenses.
Reasining for (c): Life membership fee is capital receipt. So, it should be capitalised and will not be shown in the Income and Expenditure account. It should be shown on the Liabilities side of the Balance sheet along with its expenses.
Balance Sheet of Bombay Women Cricket Club
as on March 31, 2017
Liabilities
Amount
Assets
Amount
(a) Donation for Pavilion
12,25,000
Pavilion constructed
10,80,000
Expenditure incurred on
construction of pavilion
(10,80,000)
1,45,000
so far
Pavilion
10,80,000
(b) Tournament Fund
10,700
Subscription for Tournament
65,800
76,500
Tournament Expenses
(72,400)
4,100
(c) Life Membership Fees
28,000

6. From the following receipts and payments and information given below, Prepare Income and Expenditure Account and opening Balance Sheet of Adult Literacy Orgnisation as on December 31, 2017.
Receipt and Payment Account for the year ending as on December 31, 2017
Information:
(i)
Subscription outstanding as on 31.12.2016 were ₹ 2,000 and on December 31, 2017 were ₹ 1,500
(ii)
On December 31, 2017 Salary outstanding was ₹ 600, and one month Rent paid in advance.
(iii)
On Jan. 01, 2016 organisation owned Furniture ₹ 12,000, Books ₹ 5,000.

Opening Balance Sheet:
Balance Sheet of Adult Literacy Organisation as on December 31, 2016
Liabilities
Amount
Assets
Amount
Capital Fund
38,550
Outstanding Subscriptions
2,000
(Balancing Figure)
Furniture
12,000
Books
5,000
Cash at Bank
15,550
Cash in Hand
4,000
38,550
38,550
Balance Sheet of Adult Literacy Organisation as on December 31, 2017
Liabilities
Amount
Assets
Amount
Capital
38,550
Outstanding subscriptions
1,500
Surplus
22,300
60,850
Outstanding subscriptions
800
2,300
Outstanding Salaries
600
from 2016
Subscriptions received
500
Fixed Deposit
18,000
in advance
Accrued Interest2
450
18,450
Books
5,000
Purchases
7,000
12,000
Prepaid Rent3
500
Furniture
12,000
Purchases
10,500
22,500
Sale
(5,000)
17,500
Cash in Hand
3,000
Cash at Bank
8,200
61,950
61,950
Working Notes:
Furniture:
Book value of furniture
=
₹ 5,000
Sold value
=
₹ 3,700
Loss on sale
=
Book Value – Sold Value
=
₹ 5,000 – ₹ 3,700
=
₹ 1,300
Interest on FD:
Interest for 6 months (June 31, 2017 to December 31, 2017)
=
{₹~18,000 × \dfrac{10}{100} × \dfrac{6}{12}}
=
₹ 900
Interest Received on FD
=
₹ 450
Accrued Interest (Interest yet to be received)
=
₹ 450
Rent: for 2017 + One Month Prepaid Rent (For 13 months)
=
₹ 6,500
Prepaid Rent one Month
=
{₹~6,500 × \dfrac{1}{13}}
=
₹ 500

7. The following is the Receipt and Payment Account of the Nari Kalayan Samittee for the year ended December 31, 2017:
You are required to prepare an Income and Expenditure Account after the following adjustments:
(a)
Subscription still to be received are ₹ 750, but subscription include ₹ 500 for the year 2018.
(b)
In the beginning of the year the Samiti owned building ₹ 20,000 and furniture ₹ 3,000 and Books ₹ 2,000.
(c)
Provide depreciation on furniture @ 5% (including purchase ), books @ 10% and building @ 5%.

Opening Balance Sheet:
Balance Sheet of Nari Kalayan Samittee
as on December 31, 2016
Liabilities
Amount
Assets
Amount
Capital Fund
27,270
Building
20,000
as of December 31, 2016
Furniture
3,000
(Balancing Figure)
Books
2,000
Cash in Hand and Cash at Bank
2,270
27,270
27,270
Balance Sheet of Nari Kalayan Samittee
as on December 31, 2017
Liabilities
Amount
Assets
Amount
Capital Fund
27,270
Building
20,000
Life Membership Fees
3,250
Depreciation3
(1,000)
19,000
30,520
Furniture
3,000
Surplus
24,040
54,560
Purchases
8,600
Advance Subscription for 2018
500
11,600
Depreciation2
(580)
11,020
Books
2,000
Purchases
6,500
8,500
Sales
(1,000)
7,500
Depreciation1
(750)
6,750
Cash in Hand
8,040
Cash at Bank
9,500
Outstanding Subscriptions
750
55,060
55,060
Working Notes:
Books
Books at the start of year
=
₹ 2,000
Books Sold out
=
(₹ 1,000)
New Books Purchased
=
₹ 6,500
Books at the end of the year
=
₹ 2,000 – ₹ 1,000 + ₹ 6,500
Books at the end of the year
=
₹ 7,500
Depreciation @ 10%
=
{₹~7,500 × \dfrac{10}{100}}
=
₹ 750
Furniture
Furniture at the start of year
=
₹ 3,000
New Furniture purchased
=
₹ 8,600
Furniture at the end of the year
=
₹ 11,600
Depreciation @ 5%
=
{₹~11,600 × \dfrac{5}{100}}
=
₹ 580
Building
Depreciation @ 5%
=
{₹~20,000 × \dfrac{5}{100}}
=
₹ 1,000

8. Following is the Receipt and Payment Account of Indian Sports Club, prepared Income and Expenditure Account, Balance Sheet as on December 31, 2015 December 31, 2017:
Receipt and Payment Account for the year ending December 31, 2017
Other Information:
Subscription outstanding was on December 31, 2016 ₹ 1,200 and ₹ 3,200 on December 31, 2017. Locker rent outstanding on December 31, 2017 ₹ 250. Salary outstanding on December 31, 2017 ₹ 1,000.
On January 1, 2017, club has Building ₹ 36,000, furniture ₹ 12,000, Sports equipments ₹ 17,500. Depreciation charged on these items @ 10% (including Purchase).
Opening Balance Sheet:
Balance Sheet of Indian Sports Club
as on December 31, 2016
Liabilities
Amount
Assets
Amount
Capital Fund
74,590
Outstanding Subscriptions
1,200
(Balancing Figure)
Building
36,000
Furniture
12,000
Sports Equipments
17,500
Cash at Bank
7,890
74,590
74,590
Balance Sheet of Indian Sports Club
as on December 31, 2017
Liabilities
Amount
Assets
Amount
Salary Outstanding
1,000
Outstanding Subscriptions
3,200
Tournament Fund
26,000
Outstanding Locker Rent
250
Tournament Expenses
(18,500)
7,500
Building
36,000
Capital Fund
74,590
Depreciation1
(3,600)
32,400
Life Membership Fee
2,200
Furniture
12,000
76,790
Purchases
7,700
Legacy
37,500
19,700
1,14,290
Depreciation2
(1,970)
17,730
Surplus
26,300
1,40,590
Sports Equipments
17,500
Purchases
12,000
29,500
Sales
(2,200)
27,300
Depreciation3
(2,730)
24,570
Billiard Table
17,500
Cash in Hand
12,690
Cash at Bank
10,000
Fixed Deposit
30,000
Accrued Interest
750
30,750
1,49,090
1,49,090
Working Notes:
Depreciation on Building:
Building
=
₹ 36,000
Depreciation @ 10%
=
{₹~36,000 × \dfrac{10}{100}}
=
₹ 3,600
Depreciation on Furniture:
Furniture
=
₹ 12,000
Furniture Purchased
=
₹ 7,700
Final Book Value
=
₹ 12,000 + ₹ 7,700
=
₹ 19,700
Depreciation @ 10%
=
{₹~19,700 × \dfrac{10}{100}}
=
₹ 1,970
Depreciation on Sports Equipment:
Sports Equipment
=
₹ 17,500
Purchases
=
₹ 12,000
Sales
=
(₹ 2,200)
Final Book Value
=
₹ 17,500 + ₹ 12,000 – ₹ 2,200
=
₹ 27,300
Depreciation @ 10%
=
{₹~27,300 × \dfrac{10}{100}}
=
₹ 2,730

9. From the following Receipt and Payment Account of Jan Kalyan Club, prepare Income and Expenditure Account and Balance Sheet for the year ending March 31, 2017.
Additional Information
Opening Balance Sheet:
Balance Sheet of Jan Kalyan Club
as on December 31, 2016
Liabilities
Amount
Assets
Amount
Advance Subscriptions
1,000
Cash in Hand
6,800
Outstanding Rent
1,000
Investment1
1,00,000
Capital Fund
1,37,500
Outstanding Subscriptions
2,000
(Balancing Figure)
Stock of Stationery
1,200
Books
13,500
Furniture
16,000
1,39,500
1,39,500
Balance Sheet of Jan Kalyan Club
as on December 31, 2017
Liabilities
Amount
Assets
Amount
Advance Subscriptions
3,200
Outstanding Subscriptions
3,700
Outstanding Rent
2,000
Furniture
16,000
Capital Fund
1,37,500
Sales
(6,000)
Life Membership Fees
7,000
10,000
1,44,500
Depreciation3
(2,000)
8,000
Surplus
11,100
1,55,600
Investments
1,00,000
Stock of Stationery
800
Books
13,500
Purchases
6,000
19,500
Depreciation4
(3,000)
16,500
Building
30,000
Cash in Hand
1,800
1,60,800
1,60,800
Working Notes:
Investment:
Let the investment be x
Interest on investment
=
{x × \dfrac{5}{100}}
(@ 5% per annum)
=
₹ 5,000
Investment x
=
{₹~5,000 × \dfrac{100}{5}}
=
₹ 1,00,000
Loss on Furniture:
Book Value of Sold Furniture
=
₹ 6,000
Sale Price
=
₹ 4,000
Loss
=
Book Value – Sale Price
=
₹ 6,000 – ₹ 4,000
=
₹ 2,000
Depreciation on Furniture:
Book Value in 2016
=
₹ 16,000
Furniture sold
=
(₹ 6,000)
Remaining Furniture
=
₹ 10,000
Book value in 2017
=
(₹ 8,000)
Depreciation
=
Book Value at the Start – Book Value at the End
=
₹ 10,000 – ₹ 8,000
=
₹ 2,000
Depreciation on Books:
Book Value in 2016
=
₹ 13,500
Purchases
=
₹ 6,000
Book Value after purchases
=
₹ 19,500
Book value in 2017
=
(₹ 16,500)
Depreciation
=
Book value at Start – Book Value at End
=
₹ 19,500 – ₹ 16,500
=
₹ 3,000

10. Receipt and Payment Account of Shankar Sports club is given below, for the year ended March 31, 2017
Receipt and Payment Account for the year ending March 31, 2017
Prepare Income and Expenditure Account and Balance Sheet with help of following Information:
Subscription outstanding on March 31, 2016 is ₹ 1,200 and ₹ 2,300 on March 31, 2017, opening stock of postage stamps is ₹ 300 and closing stock is ₹ 200, Rent ₹ 1,500 related to 2015 and ₹ 1,500 is still unpaid.
On April 1, 2016 the club owned furniture ₹ 15,000, Furniture valued at ₹ 22,500 on March 31, 2016 March 31, 2017.
On March 31, 2017, the club had a loan of ₹ 20,000 (@ 10% p.a) in 2017 2016.
Opening Balance Sheet:
Balance Sheeet of Shankar Sports Club
as on March 31, 2016
Liabilities
Amount
Assets
Amount
Rent Outstanding
1,500
Cash in Hand
2,600
10% Loan
20,000
Outstanding Subscriptions
1,200
Furniture
15,000
Stock of Postage Stamps
300
Capital Fund Deficit
(Balancing Figure)
2,400
21,500
21,500
Balance Sheeet of Shankar Sports Club
as on March 31, 2017
Liabilities
Amount
Assets
Amount
Rent Outstanding
1,500
Subscriptions Outstanding
2,300
10% Loan
20,000
Billiard Table
14,000
Donation for Building
23,000
Furniture
15,000
Capital Fund
(2,400)
Purchases
10,000
Life Membership Fee
7,000
25,000
3,600
Depreciation1
(2,500)
22,500
Deficit
(6,100)
Stock of Postage Stamps
200
(Note: Capital Fund Deficit
Cash in Hand
4,000
is shown on the assets side)
Capital Fund (Deficit)
1,500
44,500
44,500
Working Notes:
Furniture:
Furniture owned on April 1, 2016
=
₹ 15,000
Purchases
=
₹ 10,000
Total
=
₹ 25,000
Book Value of Furniture on March 31, 2017
=
(₹ 22,500)
Depreciation
=
Book Value at Start – Book Value at End
=
₹ 25,000 – ₹ 22,500
=
₹ 2,500

11. Prepare Income and Expenditure Account and Balance Sheet for the year ended March 31, 2016 from the following Receipt and Payment Account and Balance Sheet of culture club:
Receipt and Payment Account
for the year ending March 31, 2016
Balance Sheet
for the year ending March 31, 2015
Liabilities
Amount
Assets
Amount
Advance Locker rent
200
Cash in hand
12,000
Subscription received in Advance
1,000
Outstanding subscription
3,000
Outstanding salary
2,000
Building
35,000
Loan
10,000
Capital Fund
36,800
50,000
50,000
Balance Sheet of Culture Club
as on March 31, 2016
Liabilities
Amount
Assets
Amount
Capital Fund
36,800
Subscriptions still Outstanding1
1,000
Life Membership Fees
1,200
(for 2014-15)
38,000
Furniture
4,000
Surplus
31,500
69,500
Defence Bonds
18,000
Salary still outstanding2 (for 2014-15)
1,000
Land
20,000
Loan
10,000
Building
35,000
Cash in Hand
2,500
80,500
80,500
Working Notes:
Subscriptions:
Outstanding Subscriptions for 2014-15
=
₹ 3,000
Subscriptions Received for 2014-15 (in 2015-16)
=
(₹ 2,000)
2014-15’s Subscriptions still outstanding
=
₹ 3,000 – ₹ 2,000
=
₹ 1,000
Salary
Outstanding Salary for 2014-15
=
₹ 2,000
Salary paid in 2015-16 (for 2014-15)
=
(₹ 1,000)
Salary still outstanding for 2014-15
=
₹ 2,000 – ₹ 1,000
=
₹ 1,000
12. From the following Receipt and Payment Account prepare final accounts of a Unity Club for the year ended March 31, 2017
Receipt and Payment Accounts for the year ending March 31, 2017
Balance Sheet as on March 31, 2017
Liabilities
Amount
Assets
Amount
Outstanding Salary
6,000
Cash
15,000
Capital Fund
6,94,000
Outstanding subscription
18,000
Library Books
30,000
Furniture
37,000
Land and Building
6,00,000
7,00,000
7,00,000
Additional Information:
1.
The Club had 500 members each paying an annual subscription of ₹ 150.
2.
On 31.3.2017 salaries outstanding amounted to ₹ 1,200 and salaries paid included ₹ 6,000 for the year 2015-16.
3.
Provide 5% depreciation on Land and Building.

Balance Sheet of Unity Club
as on March 31, 2017
Liabilities
Amount
Assets
Amount
Advance Subscriptions
12,000
Outstanding Subscriptions
15,000
for next year
Furniture
37,000
Outstanding Salaries
1,200
Purchases
18,000
Capital Fund
6,94,000
55,000
Deficit
(200)
6,93,800
Sales
(6,000)
49,000
Library Books
30,000
Purchases
10,000
40,000
Land and Building
6,00,000
Depreciation1 @ 5%
30,000
5,70,000
Cash and Bank
33,000
7,07,000
7,07,000
Working Notes:
Calculation of Depreciation on Land and Building:
Book Value
=
₹ 6,00,000
Depreciation @ 5%
=
{₹~6,00,000 × \dfrac{5}{100}}
=
₹ 30,000
13. Following is the information in respect of certain items of a Sports Club. You are required to show them in the Income and Expenditure Account and the Balance Sheet.

Note that only interest on Generic fund should be considered while preparing the Income and Expenditure Account.. Interest on specific funds i.e. Sports Fund in this case, will be considered in the Balance Sheet.

Expenditure
Amount
Income
Amount
By Interest on General Fund Investment
20,000
Balance Sheet of Sports Club
as on March 31, 2017
Liabilities
Amount
Assets
Amount
Sports Fund
80,000
Sports Fund Investments
80,000
Interest on Sports Fund
8,000
General Fund Investments
2,00,000
Investments
88,000
Donations for Sports Fund
30,000
1,18,000
Sports Prizes awarded
(16,000)
1,02,000
Expenses on Sports Events
(7,000)
95,000
General Fund
2,00,000
Note: Scope of the problem is to show the entries in the Balance Sheet. So, balance sheet is not balanced.
14. Receipt and Payment Account of Maitrey Sports Club showed that ₹ 68,500 were received by way of subscriptions for the year ended on March 31, 2017.
The additional information was as under:
1.
Subscription Outstanding as on March 31, 2016 were ₹ 6,500,
2.
Subscription received in advance as on March 31, 2016 were ₹ 4,100,
3.
Subscription Outstanding as on March 31, 2017 were ₹ 5,400,
4.
Subscription received in advance as on March 31, 2017 were ₹ 2,500.
Show how that above information would appear in the final accounts for the year ended on March 31, 2017 of Maitrey Sports Club.
Expenditure
Amount
Income
Amount
By Subscriptions
68,500
Outstanding Subscriptions
for previous year
(6,500)
62,000
Advance Subscriptions received previous year (for current year)
4,100
66,100
Outstanding Subscriptions for current year
5,400
71,500
Advance Subscriptions for next year
(2,500)
6,900
Opening Balance Sheet
Balance Sheet of Maitrey Sports Club
as on March 31, 2016
Liabilities
Amount
Assets
Amount
Subscriptions Received in advance
4,100
Outstanding Subscriptions
6,500
Balance Sheet
as on March 31, 2017
Liabilities
Amount
Assets
Amount
Subscriptions Received in advance
2,500
Outstanding Subscriptions
5,400
Note: As only the subscriptions are given, the information given is incomplete. So, the balance sheet is not balanced.
15. Following is the Receipt and Payment account of Rohatgi Trust :
Liabilities
Amount
Assets
Amount
Cash in hand
14,000
Rent
6,000
Cash at bank
60,000
Salary
12,000
Subscription:
Postage
300
2016
5,000
Electricity charges
6,000
2017
83,000
Purchase of furniture
20,000
2018
3,000
91,000
Books
3,000
Sale of investment
90,000
Defence Bonds
1,50,000
Interest on investment
2,000
Help to needy students
22,000
Sale of furniture
3,200
Cash in hand
10,900
(Book value ₹ 3,000)
Cash at bank
30,000
2,60,200
2,60,200
Prepare Income and expenditure account for the year ended December 31, 2017, and a balance sheet as on that date after the following adjustments:
Subscription for 2017, still owing were ₹ 7,000. Interest due on defence bonds was ₹ 7,000, Rent still owing was ₹ 1,000. The Book value of investment sold was ₹ 80,000, ₹ 30,000 of the investment were still in hand. Subscription received in 2017 included ₹ 400 from a life member. The total furniture on January 1, 2017 was worth ₹ 12,000. Salary paid for the year 2018 is ₹ 2,000.
Opening Balance Sheet
Balance Sheet of Rastogi Trust
as on March 31, 2016
Liabilities
Amount
Assets
Amount
Capital Fund
2,01,000
Outstanding Subscriptions
5,000
(Balancing Figure)
Investments
(₹ 80,000 + ₹ 30,000)
1,10,000
Furniture
12,000
Cash in Hand
14,000
Cash at Bank
60,000
2,01,000
2,01,000
Balance Sheet of Rastogi Trust
as on March 31, 2017
Liabilities
Amount
Assets
Amount
Advance Subscriptions
3,000
Outstanding Subscriptions
7,000
Outstanding Rent
1,000
Furniture
12,000
Capital Fund
2,01,000
Purchases
20,000
Surplus
63,500
32,000
2,64,500
Sales
(3,000)
29,000
Life Membership Fees
400
2,64,900
Books
3,000
Defence Bonds
1,50,000
Accrued Interest
on Defence Bonds
7,000
1,57,000
Investments
30,000
Advance Salaries
2,000
Cash in Hand
10,900
Cash at Bank
30,000
2,68,900
2,68,900
Working Notes:
Investments:
Book value of Investments sold
=
₹ 80,000
Investments still in hand
=
₹ 30,000
Book value of Investments Before sale
=
₹ 80,000 + ₹ 30,000
=
₹ 1,10,000
Profit on Sold Investments:
Sale value of investments
=
₹ 90,000
Book value of sold investments
=
₹ 80,000
Profit from sale of investments
=
₹ 90,000 – ₹ 80,000
=
₹ 10,000
Furniture
Sale value of Furniture
=
₹ 3,200
Book value of furniture
=
₹ 3,000
Profit from sale of furniture
=
₹ 3,200 – ₹ 3,000
=
₹ 200
16. Following Receipt and Payment Account was prepared from the cash book of Delhi Charitable Trust for the year ending December 31, 2017
Receipt and Payment Account for the year ending December 31, 2017
Prepare Income and expenditure account for the year ended December 31, 2017, and a balance sheet as on that date after the following adjustments:
(a)
It was decided to treat one-third of the amount received on account of donation as income.
(b)
Insurance premium was paid in advance for three months.
(c)
Interest on investment ₹ 1,100 accrued was not received.
(d)
Rent ₹ 600: salary ₹ 900 and advertisement expenses ₹ 1,000 outstanding as on December 31, 2018.

Opening Balance Sheet
Balance Sheet of Delhi Charitable Trust
as on December 31, 2016
Liabilities
Amount
Assets
Amount
Capital Fund
24,100
Cash in Hand
11,500
(Balancing Figure)
Cash at Bank
12,600
24,100
24,100
Balance Sheet of Delhi Charitable Trust
as on December 31, 2017
Liabilities
Amount
Assets
Amount
Capital Fund
24,100
Prepaid Insurance1
400
Donation2
6,000
Investment
23,000
(Capital Fund part)
30,100
Accrued Interest
1,100
24,100
Legacies
18,000
Furniture
21,600
48,100
Cash in Hand
9,900
Surplus
21,400
69,500
Cash at Bank
16,000
Outstanding Rent
600
Outstanding Salary
900
Outstanding Advertisement Expenses
1,000
72,000
72,000
Working Notes:
Insurance:
Insurance Paid
=
₹ 2,000
Number of months for which Insurance is paid (12 months for current year + 3 months advance)
=
15
Insurance for current year i.e. 12 months
=
{₹~2,000 × \dfrac{12}{15}}
=
₹ 1,600
Prepaid Insurance
=
₹ 2000 – 1,600
=
₹ 400
Donation:
Total Donation Received
=
₹ 9,000
Donation Considered as income i.e. one-third
=
{₹~9,000 × \dfrac{1}{3}}
=
₹ 3,000
Donation Considered as fund
=
₹ 9,000 – ₹ 3,000
=
₹ 6,000
17. From the following Receipt and Payment Account of a club, prepare Income and Expenditure Account for the year ended March 31, 2017 and the Balance Sheet as on that date.
Receipt and Payment Account for the year ending March 31, 2017
Additional Information:
(a)
The club has 100 members each paying an annual subscription of ₹ 900. Subscriptions outstanding on March 31, 2016 were ₹ 3,600.
(b)
On March 31, 2017, salary outstanding amounted to ₹ 1,000, Salary paid included ₹ 1,000 for the year 2016.
(c)
On April 1, 2017 the club owned land and building ₹ 25,000, furniture ₹ 2,600 and books ₹ 6,200.

Opening Balance Sheet:
Balance Sheet of Club
as on March 31, 2016
Liabilities
Amount
Assets
Amount
Outstanding Salary
1,000
Outstanding Subscriptions
3,600
Capital Fund
39,900
Furniture
2,600
(Balancing Figure)
Books
6,200
Cash and Bank
3,500
Building
25,000
40,900
40,900
Balance Sheet of Club
as on March 31, 2017
Liabilities
Amount
Assets
Amount
Advance Subscriptions
3,000
Outstanding Subscriptions
20,000
Outstanding Salary
1,000
for current year (2016-17)
Capital Fund
39,900
Outstanding Subscriptions1
1,600
21,600
Surplus
79,700
1,19,600
from previous year 2015-16
Building
25,000
Furniture
2,600
Purchases
26,500
29,100
Books
6,200
Purchases
13,000
19,200
Sales
(3,200)
16,000
T.V. Set
16,000
Cash and Bank
15,900
1,23,600
1,23,600
Working Notes
Subscriptions:
Number of members
=
100
Subscription by each member
=
₹ 900
Total Amount of Subscriptions
=
100 × ₹ 900
=
₹ 90,000
Subscriptions received for current year
=
₹ 70,000
Outstanding subscriptions for current year
=
₹ 90,000 – ₹ 70,000
=
₹ 20,000
Outstanding Subscriptions for the previous year (2015-16)
=
₹ 3,600
Previous Year’s 2015-16 Outstanding Subscriptions paid in the current year (2016-17)
=
₹ 2,000
Previous Year’s (2015-16) Subscriptions Still Outstanding at the end of current year 2016-17
=
₹ 3,600 – ₹ 2,000
=
₹ 1,600
Books:
Book value of sold books
=
₹ 3,200
Sale Price of books
=
₹ 2,000
Loss on sale of books
=
₹ 3,200 – ₹ 2,000
=
₹ 1,200
18. Following is the Receipt and Payment Account of Women’s Welfare Club for the year ended December 31, 2017:
Receipt and Payment Account for the year ending December 31, 2017
Additional Information:
Prepare Income and Expenditure Account for the year ended December 31, 2017 and Balance Sheet as on date.
Opening Balance Sheet:
Balance Sheet of Women’s Welfare Club
as on December 31, 2016
Outstanding Salaries
1,200
Insurance Prepaid
700
Advance Subscriptions
1,750
Oustanding Subscriptions
3,750
Capital Fund
2,26,600
Stock of stationery
2,250
(Balancing Figure)
Equipments
25,600
Building
1,20,000
Cash and Bank
7,250
Investments
70,000
2,29,550
2,29,550
Balance Sheet of Women’s Welfare Club
as on December 31, 2017
Liabilities
Amount
Assets
Amount
Oustanding Salaries
1,800
Equipments
25,600
Advance Subscriptions
1,000
Purchases
30,000
Outstanding Electricity Charges
1,250
55,600
Capital Fund
2,26,600
Depreciation3
(5,400)
50,200
Surplus
34,100
2,60,700
Insurance Prepaid
300
Outstanding Subscriptions
2,500
Stock of Stationery
700
Building
1,20,000
Depreciation4
(6,000)
1,14,000
Cash and Bank
27,050
Investments1
70,000
2,64,750
2,64,750
Working Notes:
Investments
Let the investment be x
Interest on investment @ 10%
=
{x × \dfrac{10}{100}}
=
₹ 7,000
∴ Investment x
=
{₹~7,000 × \dfrac{100}{10}}
=
₹ 70,000
Charity Show
Proceeds of Charity Show
=
₹ 16,500
Expenses on Charity Show
=
₹ 12,900
Profit from charity Show
=
₹ 16,500 – ₹ 12,900
=
₹ 3,600
Depreciation on Equipments:
Book Value at the beginning of the year
=
₹ 25,600
Purchases
=
₹ 30,000
Total Book Value of Equipment
=
₹ 25,600 + ₹ 30,000
=
₹ 55,600
Book Value at the end of the year
=
₹ 50,200
Depreciation
=
Book Value at start – Book Value at end
=
₹ 55,600 – ₹ 50,200
=
₹ 5,400
Depreciation on Building
Book Value at the beginning of the year
=
₹ 1,20,000
Book Value at the end of the year
=
₹ 1,14,000
Depreciation
=
₹ 1,20,000 – ₹ 1,14,000
=
₹ 6,000
19. As at March 31, 2015 March 31, 2017 the following balances have been extrated from the books of the Indian Chartered Accountants Recreation Club and you are asked to prepare Income and Expenditure Account for the year ended March 31, 2017 and a Balance Sheet as at that date.
On March 31,2016 stock of Stationary Stationery consisted of ₹ 900 and March 31, 2017 ₹ 60 respectively. Provide depreciations ₹ 60 on fixtures and fittings, ₹ 390 on billiard table and ₹ 560 on furniture.
Balance Sheet of Indian Chartered Accountants Recreation Club
as on March 31, 2017
Liabilities
Amount
Assets
Amount
Sundry Creditors
5,370
Cash in Hand
560
Grant from Institute
42,000
Cash at Bank
2,760
Capital Fund
1,380
Fixed Deposit
8,500
(Income and Expenditure A/c in 2016)
Sundry Debtors
2,250
Surplus
550
1,930
Billiards Table
2,070
Capital Fund
840
Depreciation
(390)
1,680
(Balancing Figure)
Fixture and Fittings
870
Depreciation
(60)
810
Furniture
4,140
Depreciation
(560)
3,580
Club Premises
30,000
50,140
50,140
Note:In the previous releases of the text book, the problem statement was different. The answers given in the text book are for an earlier version of the problem. Later on, the problem statement is changed but the answer values didn’t change. So, you will notice that the answers that we got here and the answers given in the text book are different.