From the following Balance sheet and Receipts and Payments Account of Padmavati High School, Thane, prepare Income and Expenditure account for the year ended 31-03-2007 and balance sheet as on that date. (September 2008)

Balance sheet as on 31^st March, 2006

Liabilities	Amount (Rs.)	Assets	Amount (Rs.)
Entrance fees Capital fund	30000 519000	Furniture Computer laboratory Library Investment Cash in hand Cash at bank Outstanding Tuition Fees	84000 100000 125000 200000 5000 15000 20000
	549000		549000

Receipts and Payment Account for the year ended 31^st March, 2007

Receipts	Amount (Rs.)	Payments	Amount (Rs.)
To balance b/d Cash in hand Cash at bank To Tuition Fees To Term Fees To Government Grant (salary) To Sundry receipts To sale of old newspapers To interest on investments To Donation of library	5000 15000 400000 120000 104500 11000 500 10000 150000	By Furniture purchased By Salaries By rent By Sundry expenses By Stationery By Annual gathering expenses By repairs of buildings By Insurance By Balance c/d Cash in Hand Cash at Bank	52000 300000 140000 27000 49000 24000 32500 20000 44500 127000
	816000		816000

Adjustments:

1. Tuition fees receivable Rs. 150000
2. Salary still payable Rs. 150000
3. Rent paid in advance Rs. 20000
4. Insurance premium is paid for one year ending 30-9-07
5. Depreciate furniture and library at 10% and computer laboratory at 20%. Depreciation is to be charged on the closing balance of assets.

Solution: In the books of Padmavati High School, Thane.

Income and Expenditure A/c for the year ended 31.03.07

Expenditure	Amount	Amount	Income	Amount	Amount
To Salaries	300000		By Tuition Fees	400000
(+) Outstanding	150000	450000	(-) Last Year Amount	-20000
To Rent	140000			380000
(-) Prepaid	-20000	120000	(+) Outstanding	150000	530000
To Sundry Expenses		27000	By Term Fees		120000
To Stationary		49000	By Government Grant [Salary]		104500
To Annual gathering expenses		24000	By Sundry receipts		11000
To Repairs of Buildings		32500	By Sale of Old Newspapers		500
To Insurance	20000		By Interest on Investments		10000
(-) Prepaid	-10000	10000
To Depreciation
Furniture	13600
Library	22500
Computer Lab.	20000	46100
To surplus [Income Over Expenditure]		17400
		776000			776000

Balance Sheet as on 31.03.07

Liability	Amount	Amount	Asset	Amount	Amount
Capital Fund	519000		Furniture	136000
(+) Surplus	17400	536400	(-) Depreciation	-13600	122400
Donation of Library		150000	Cash in Hand		44500
Entrance Fees		30000	Cash at Bank		127000
Outstanding Salary		150000	Computer Laboratory	100000
			(-) Depreciation	-20000	80000
			Library	125000
			(-) Depreciation	-12500	112500
			Investments		200000
			Outstanding Tuition Fees		150000
			Prepaid Rent		20000
			Prepaid Insurance		10000
		866400			866400