Maharashtra State BoardHSC Commerce 12th Board Exam
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From the following transactions of Receipts and Payments Account of “Pavan - Putra Hanuma Vyayamshala” Parbhani, and the adjustments given - Book Keeping and Accountancy

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From the following transactions of Receipts and Payments Account of “Pavan - Putra Hanuma Vyayamshala” Parbhani, and the adjustments given, you are required to prepare Income and Expenditure Account and Balance Sheet as on 31st March 2019.

Dr Receipts and Payments Account for the year ending 31.03.2019. Cr
Receipts Amount
Payments Amount
To Balance b/d   By Salaries 6,000
Cash in Hand 5,000 By Entertainment Expenses 2,480
To Subscriptions   By Sundry Expenses 1,300
2018 - 19 18,000   By Electricity Charges 1,200
2019 - 20 410 18,410 By Rent 700
To Donations 6,000 By Investment 15,000
To Receipts from Entertainment 5,400 By Printing and Stationery 800
To Interest 400 By Postage 3,200
To Entrance fees 6,200 By Fixed Deposit 3,900
    By Balance c/d  
    Cash in Hand 830  
    Cash at Bank 6000 6,830
  41,410   41,410

Adjustments:

1) There are 500 members paying an annual Subscription of ₹ 50 each

2) Outstanding Salary was ₹ 1,200

3) The Assets on 01.04.2018 were as follows: Building ₹ 50,000, Furniture ₹ 15,000

4) Provide depreciation on Building and Furniture at 5% and 10% respectively.

5) 50% Entrance Fee is to be capitalized.

6) Interest on Investment at 5% p. a. has accrued for 6 months.

7) Capital Fund ₹ 70,000 on 01.04.2018

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Solution

 

Dr

In the books of Pavan-putra Hanuman Vyayamshala, Parbhani

Income and Expenditure Account for the year ended on 31st March, 2019

Cr
Expenditure Amount
Amount
Income Amount
Amount
To Salaries 6,000   By Subscription 18,000  
Add*: Outstanding 1,200 7,200 Add: Outstanding Subscription for Current Year 7000 25000
To Entertainment Expenses   2,480 By Donations   6,000
To Sundry Expenses   1,300 By receipts from Entertainment   5,400
To Electricity Charges   1,200 By Interest   400
To Rent   700 By Outstanding Interest on Investments (6 Months)   375
To Printing and Stationery   800 By Entrance Fees 6,200  
To Postage   3,200 Less : 50 % capitalised 3,100 3,100
To Depreciation          
Building 2,500        
Furniture 1,500 4,000      

To Surplus 

(Excess of income over expenditure)

  19,395      
    40,275     40,275

 

Balance Sheet as on 31st March, 2019
Liabilities Amount ₹ Amount ₹ Assets Amount ₹ Amount ₹
Capital Fund 70,000   Building 50,000  
Add: Surplus 19,395   Less: Depreciation 2,500 47,500
Add: 50 % Entrance Fees 3,100 92,495 Furniture 15,000  
Outstanding Salary   1,200 Less: Depreciation 1,500 13,500
Subscription received in Advance   410 Investments   15,000
      Outstanding Interest on Investments   375
      Fixed Deposit   3,900
      Cash in Hand   830
      Cash at Bank   6,000
      Outstanding Subscription of Current Year   7,000
    94,105     94,105

Working Notes :

(1) Interest on investment is receivable for 6 months

`"I" = ("PRN")/100 = 15,000 xx 5/100 xx 6/12 = ₹  375 ` (outstanding interest on investment)

(2) 50% of entrance fees (i.e.  `6200/2` = ₹ 3100) is to be capitalised means add it to capital fund.

(3) Total subscription of current year = 500 members × ₹ 50 = ₹ 25,000
But actual subscription received = ₹ 18,000
means difference (25,000 – 18,000) of ₹ 7,000 is outstanding subscription.

Concept: Income and Expenditure Account
  Is there an error in this question or solution?
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APPEARS IN

Balbharati Book-keeping and Accountancy 12th Standard HSC Maharashtra State Board
Chapter 2 Accounts of ‘Not for Profit’ Concerns
Exercise 2 (Practical Problems) | Q 7. | Page 118
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