Following is the Receipts and Payments Account and additional information of Kalpana Hospital, Sakri. (March 2012)

Receipts and Payments account for the year ended 31^st March, 2010

Receipts	Amount	Payments	Amount
To Balance b/d	6000	By Medicines	10000
To Subscriptions		By Honorarium to Doctors	75000
2008 – 2009	7500	By Ambulance Maintenance	44000
2009 – 2010	95000	By Hospital Equipments Purchased	33000
2010 – 2011	15000	By Furniture Purchased	25000
To Donations	55000	By Fixed Deposits	100000
To Life Membership Fees	150000	By Balance C/d	69500
	353500		353500

Additional Information:

i.             Outstanding subscription for 200 9 – 2010 is amounted to Rs. 5000.

ii.            Hospital Equipments and Furniture were purchased on 1.10.2009 and both were to be depreciated at 20% p.a.

iii.          Life membership fees are to be capitalized.

iv.           Donations represent donations for Building fund.

v.            Staff salary for the current year is outstanding Rs. 7500.

vi.           On 1.4.2009, the hospital had the following assets and liabilities: Land and Building Rs. 250000, Investments Rs. 50000, Ambulance Rs. 1,02,500, Bank Loan Rs. 2,00,000.

vii.         Capital fund as on 1.4.2009 was amounted to Rs. 2,16,000.

Prepare: Income and Expenditure Account for the year ending 31^st March, 2010 and the Balance Sheet as on that date.

Solution: In the books of Kalpana Hospital, Sakri

Income and Expenditure A/c for the year ended 31.03.10

Expenditure	Amount	Amount	Income	Amount	Amount
To Medicine		10000	By Subscriptions	95000
To Honorarium to Doctors		75000	(+) Outstanding	5000	100000
To Ambulance Maintenance		44000	By Donations	55000
To Depreciation			(-) Building Fund	(55000)	NIL
Equipments	3000		By Life Membership Fees	25000
Furniture	2500	5500	(-) Capitalised	(25000)	NIL
To Outstanding Staff Salary		7500	By Hospital Receipts		150000
To Surplus [Income over Expenditure]		108000
		250000			250000

Balance Sheet as on 31.03.10

Liability	Amount	Amount	Asset	Amount	Amount
Capital Fund	216000		Hospital Equipment	30000
(+) Life Membership Fees	(25000)		(-) Depreciation	(3000)	27000
	241000		Furniture	25000
(+) Surplus	108000	349000	(-) Depreciation	(2500)	22500
Advance Subscription of Next Year		15000	Fixed Deposits		100000
Building Fund		55000	Cash Balance		69500
Outstanding Staff Salary		7500	Outstanding Subscription  for current year		5000
Bank Loan		200000	Land & Building		250000
			Investments		50000
			Ambulance		102500
		626500			626500