Question

Following is the Receipts and payments Accounts and additional information of Jeevan Hospital , Kolhapur . Prepare Incomeand Expenditure Account for the year ending 31st March , 2016 and the balance Sheet as on that date.

Receipts and Payments Account for the year
ended on 31st March , 2016

Dr.                                                                                            Cr.

Receipts		Amount (₹)	Payments	Amount (₹)
To Balance B/d		12000	By Medicine	20000
To Subscription			By Honorarium to doctors	150000
2014 - 2015	15000	235000	By Ambulance maintance	88000
2015 - 2016	190000		By Hospital equipment purchased	60000
2016 - 2017	30000		By Furniture purchased	50000
To Donation for building fund		110000	By Fixed deposit	200000
To Life membership fees		50000	By Balance c/d	139000
To Hospital receipts (Revenue)		300000
		707000		707000

Additional information :

(1) Outstanding subscription for 2015 - 2016 is 10000.

(2) Hospital equipment and furniture were purchased on 01.10.2015 and both the assets were to be depreciated @ 20 % p.a.

(3) Life membership fees are to be capitalized.

(4) Staff salary for current yera is outstanding ₹ 15000

(5) On 01.04.2015 the hospital had the following assets and liabilities :

Land             ₹ 500000;

Investment  ₹ 100000 ;

Bank loan    ₹ 400000 ;

Ambulance  ₹ 205000  

(6) Capital fund as on 01.04.2015 was ₹ 432000.

Answer 1

In the books of Jeevan Hospital, Kolhapur.

Income and Expenditure A/c

For the year ended 31st March, 2016

Expenditure	Rs.	Rs.	Income	Rs.	Rs.
To Medicines		20000	By Subscription	190000
To Honorarium to Doctors		150000	(+) Outstanding	10000	200000
To Ambulance maintenance		88000	By Hospital Receipts		300000
To Depreciation
Equipment	6000	11000
Furniture	5000
To Outstanding Staff Salary.		15000
To Income Over Expenditure [Surplus]		216000
		500000			500000

 

Jeevan Hospital, Kolhapur.

Balance Sheet as on 31st March 2016.

Liabilities	Rs.	Rs.	Assets	Rs.	Rs.
Capital Fund	432000	698000	Hospital Equipment	60000	54000
(+) Life Membership Fees	50000		(-) Deprecation @ 20% for 6 Months.	- 6000
(+) Surplus	216000		Furniture	50000	45000
Donation for Building Fund		110000	(-) Deprecation @ 20% for 6 Months.	- 5000
Outstanding Staff Salary for Current year		15000	Fixed Deposit		200000
Bank Loan		400000	Bank Balance		139000
			Land		500000
Advance Subscription of Next year. [2016 - 2017]		30000	Investment		100000
			Ambulance		205000
			Outstanding Subscription for Current year.		10000
		1253000			1253000

Working Note:-

(1)  Depreciation on Hospital equipment for 6 Months @ 20% p.a.  (i.e. from Oct to March)

`(60000 xx 6 xx 20)/(100 xx 12) = 60000`

(2) Depreciation of furniture for 6 months @ 20% p.a. (i.e. from Oct to March)

`(50000 xx 6 xx 20)/(100 xx 12) = 50000`