OMTEX CLASSES: From the following information supplied to you, prepare Income and Expenditure Account for the year ending on 31.03,2020 and Balance Sheet as on that date for “Morya Sports Club” Thane.

Practical Problems | Q 13 | Page 123

From the following information supplied to you, prepare Income and Expenditure Account for the year ending on 31.03,2020 and Balance Sheet as on that date for “Morya Sports Club” Thane.

Balance Sheet as on 01.04.2019.

Liabilities	Amount ₹	Assets	Amount ₹
Capital Fund	64,500	Machinery	69,000
Bank overdraft	38,000	Outstanding Subscriptions	8,000
Outstanding Salary	4,000	Prepaid Insurance Premium	2,000
		Furniture	15,000
		Cash in Hand	12,000
		Outstanding Locker’s Rent	500
	1,06,500		1,06,500

Receipts and Payments Account for the year ended 31.03.2020

Liabilities	Amount ₹	Payments	Amount ₹
To Balance b/d	12,000	By Balance b/d (Bank Overdraft)	38,000
To Subscription	1,05,000	By Salary	17,500
To Entrance Fees (Capitalized)	9,300	By Insurance Premium	11,000
To Locker Rent	1,500	By Interest	1,400
To Donations (Capitalized)	800	By Refreshment Expenses	4,200
		By Furniture	30,000
		By Balance c/d
		Cash in Hand	6,500
		Cash at Bank	20,000
	1,28,600		1,28,600

Adjustments :

1) Subscription received includes ₹ 3,000 for 2018 - 19 and Outstanding Subscription for 2019 - 20 was ₹ 14,000.

2) On 31.03.2020, Prepaid Insurance Premium was ₹ 2,500.

3) Depreciate Furniture by ₹ 3,000.

4) Locker Rent Outstanding for 2019 - 20 is ₹ 400

Solution:

In the books of ‘Morya Sports Club’ Thane

Income and Expenditure Account for the year ended 31st March, 2020

Expenditure	Amount ₹	Amount ₹	Income	Amount ₹	Amount ₹
To Salary	17,500		By Subscription	1,05,000
Less: Outstanding salary of 2018 – 19	4,000	13,500	Add: Outstanding Subscription for Current Year	14,000
To Insurance Premium	11,000			1,19,000
Less: Prepared Insurance Premium	2,500		Less: Subscription Received of 2018 – 19	3,000	1,16,000
	8,500		By Locker Rent	1,500
Add: Prepaid Insurance premium of current year Paid in previous year	2,000	10,500	Add: Outstanding Locker Rent	400
To Depreciation				1,900
Furniture		3,000	Less: Outstanding Locker Rent of Previous Year	500	1,400
To Interest		1,400
To Refreshment Expenses		4,200
To Surplus (Excess of income over Expenditure)		84,800
		1,17,400			1,17,400

Balance Sheet as on 31st March, 2020

Liabilities	Amount ₹	Amount ₹	Assets	Amount ₹	Amount ₹
Capital Fund	64,500		Machinery		69,000
Add: Surplus	84,800		Outstanding Subscription (2018 – 19) (8,000 – 3,000)		5,000
Add: Entrance fees (Capitalised)	9,300		Outstanding Subscription (2019–20)		14,000
Add: Donations (Capitalised)	800	1,59,400	Prepaid Insurance Premium		2,500
			Furniture	15,000
			Add: Purchases	30,000
				45,000
			Less: Depreciation	3,000	42,000
			Outstanding Locker Rent (2019 – 20)		400
			Cash in Hand		6,500
			Cash at Bank		20,000
		1,59,400			1,59,400

Working Notes :

(1) Outstanding subscription (2018–19) ₹ 8,000 given in b/s against that ₹ 3,000 received in 2019–20.

Means still receivable subscription = ₹ 5,000 (8,000 – 3,000).

(2) Prepaid insurance premium (2018 – 19) ₹ 2,000 is for the current year. Therefore, in current year’s insurance premium, ₹ 2,000 is to be added and then subtract current year’s prepaid insurance premium.

(3) Outstanding salary of (2018 – 19), ₹ 4,000 of the previous year is to be subtracted from the current year’s salary.

(4) The total amount of donations and entrance fees are to be capitalised so add the entire amount of both the items to the Capital fund.

(5) Outstanding locker’s rent (2018 – 19) ₹ 500 is given in Balance Sheet. It is to be subtracted from current year’s locker’s rent and then add current year’s outstanding locker rent.

Book-keeping and Accountancy 12th Standard

HSC Maharashtra State Board. Latest Syllabus.

Chapter 1: Introduction to Partnership and Partnership Final Accounts

Chapter 2: Accounts of ‘Not for Profit’ Concerns

Chapter 3: Reconstitution of Partnership (Admission of Partner)

Chapter 4: Reconstitution of Partnership (Retirement of Partner)

Chapter 5: Reconstitution of Partnership (Death of Partner)

Chapter 6: Dissolution of Partnership Firm

Chapter 7: Bills of Exchange

Chapter 8: Company Accounts - Issue of Shares

Chapter 9: Analysis of Financial Statements

Chapter 10: Computer In Accounting