Question

How will the following items be treated while preparing the financial statements of a not-for-profit organization for the year ended 31^st March, 2019?

	As at 31-3-2018 (₹)	As at 31-3-2019 (₹)
Creditors for medicines	33,000	67,000
Stock of medicines	27,000	43,000

During 2018-19, the payment made to the creditors was ₹ 4,25,000.

Answer 1

In the books of …. 
Income & Expenditure A/c  

Dr.	for the year ended 31st March, 2019		Cr.
Expenditure	Amount (₹)	Income	Amount (₹)
To Medicines consumed (WN 1)	4,43,000

Balance Sheet as at 31^st March, 2019

Liabilities	Amount (₹)	Assets	Amount (₹)
Creditors for Medicines	67,000	Stock of Medicines	43,000

Working Notes:

(1)

Dr.	Creditors for Medicines A/c		Cr.
Particulars	Amount (₹)	Particulars	Amount (₹)
To Bank A/c	4,25,000	By balance b/d	33,000
(Payment to creditors)		By Stock of Medicines A/c
		(Purchases made) (Bal. Fig.)	4,59,000
To balance c/d	67,000
	4,92,000		4,92,000

)

Dr.	Stock of Medicines A/c		Cr.
Particulars	Amount (₹)	Particulars	Amount (₹)
To balance b/d	27,000	By Income & Expenditure A/c	4,43,000
		(Bal. Fig.)
To Creditors for Medicines A/c	4,59,000	By balance c/d	43,000
	4,86,000		4,86,000