Practical Problems | Q 7 | Page 118
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.
Receipts and Payments Account for the year ending 31.03.2019.
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
Solution:
In the books of Pavan-putra Hanuman Vyayamshala, Parbhani
Income and Expenditure Account for the year ended on 31st March, 2019
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 = PNR/100 = 15000 × (5 ÷ 100) × (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 the 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.
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 8: Company Accounts - Issue of Shares
Chapter 9: Analysis of Financial Statements
Chapter 10: Computer In Accounting
ACCOUNTS BOARD PAPERS
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ADMISSION OF A PARTNER: View | PDF Download
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ACCOUNTING FOR SHARES : View | PDF Download
DISSOLUTION OF PARTNERSHIP FIRM : View | PDF Download
VALUATION OF GOODWILL WITH SOLUTION: View | PDF Download
FORMAT OF FINAL ACCOUNT : View | PDF Download
INTRODUCTION TO PARTNERSHIP: View | PDF Download
DISSOLUTION OF PARTNERSHIP FIRM
VALUATION OF GOODWILL WITH SOLUTION
ACCOUNTS BOARD PAPERS WITH SOLUTION
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