ದ್ವಿತೀಯ ಪಿ.ಯು.ಸಿ ಲೆಕ್ಕಶಾಸ್ತ್ರ ಅಧ್ಯಾಯ – 1 ನೋಟ್ಸ್ 2nd Puc Accountancy Chapter 1 Accounting for Not-For-Profit Organization Notes Mcq Download 2nd Puc Accountancy 1st Chapter Problems And Solutions Pdf Question Answer 2nd Puc Commerce Accountancy 1st Chapter Notes Accounting For Not-For-Profit Organization One Mark Question Accounting For Not-For-Profit Organisation Class 12 Notes Accounting Not-For-Profit Organisation Problems And Solutions
2nd Puc Accountancy Chapter 1 Notes
2nd Puc Accountancy Chapter 1 Notes
Short Questions
Q1. What is Capital Fund? How is it calculated?
The scenario where value of assets of NPO are more than its liabilities, it is called as capital fund. This is similar to the concept of capital for an organisation working to earn profit. If any surplus amount is received from I & E account, it gets added to capital fund, likewise any deficit will be deducted from the same and is known as Accumulated Fund.
Calculating Capital Fund
Capital Fund at the beginning of the year | ** | |
Add: Surplus from Income and Expenditure Account | ** | |
Add: Subscription Amount (Capitalised amount) | ** | |
Add: Life membership fee. | ** | ** |
Less: Deficit from Income and Expenditure Account | ** | |
Capital Fund at the end of the year | *** |
Q2. State the meaning of ‘Not-for-Profit’ Organisations.
Organizations that are established with the aim of providing services to society and not profit earning are called as Not-for-profit Organisations (NPO). Some organisations that come under NPO are hospitals, religious organisations and trade unions. An NPO earns income from life membership fees, subscriptions, grants, donations etc.
Q3. What are the features of Receipt and Payment Accounts?
The receipts and payments account has the following features:
1. It is known as cash book summary for NPO (Not-for-profit organisations) as it records all the cash and cash equivalents of the organisation.
2. This account shows cash transactions that are of revenue and capital nature
3. It does not follow the double entry bookkeeping system as it is a summary of transactions.
4. It does not include transactions that do not have cash or bank items.
5. It helps in revealing the cash position of the organisation
Q4. State the meaning of Receipt and Payment Account.
A receipts and payments account (R & P Account) is a summary of actual cash receipts and payments that is extracted from the cash book over a certain time period. All the cash received is recorded on the Receipts and all the cash payments gets recorded in Payments side of the R & P Account. All the cash and bank transactions are recorded in Cash Book and this book is created on the basis of all these transaction. All cash and bank transactions that are of revenue and capital nature gets recorded. It records all transactions i.e. bank receipts and cash receipts.
This account helps in determining the closing balance of bank and cash receipts and thereby assess cash position of a Not-for-profit organisation or NPO.
Q5.What steps are taken to prepare Income and Expenditure Account from a Receipt and Payment Account?
Following steps should be followed:
1. Exclude opening cash and bank balances and also do the same for closing cash and balances
2. Exclude income of the previous period and any such income that is received in advance
3. Exclude all items involving capital receipts and payments
4. Exclude expenditures that are of the previous or coming period
5. Include all incomes of the current period which are yet to be received
6. Include expenditures of current period which are yet to be paid.
7. Provision for bad debts and fixed assets depreciation should be taken into account and charged to the account (income and expenditure account)
2nd Puc Accountancy Chapter 1
Q6. What is subscription? How is it calculated?
For a not-for-profit organisation subscription acts as one of the main sources of income. It refers to money that the members pay periodically for maintaining their membership in active state. Subscription charges can be paid in flexible options like monthly, quarterly, half-yearly or yearly. It appears on the receipt side of R & P account.
For calculating subscription for current period, add subscription received in advance meant for current period during the previous year and outstanding subscription for current year to the subscription received for the current year and deducting subscription received in advance for next year and outstanding subscription from previous year from subscription received in the current year.
Calculation of Subscription
Subscription received during the year (+) Subscription received (in advance) during previous year for current year (+) Subscription outstanding at the end of the year(-) Subscription received in advance for the next year (-) Subscription outstanding for the previous year Subscription shown in Income and Expenditure Account | – –– – | ––– |
Q7. What is Receipt and Payment Account?
A receipts and payments account is a summary of actual cash receipts and payments that is extracted from the cash book over a certain time period. All the cash received is recorded on the Receipts and all cash payments are recorded in Payments side of the Receipts and Payments Account. This account is prepared on the basis of all the cash and bank transactions that are recorded in Cash Book. It records all cash and bank transactions that are of revenue and capital nature. It records all transactions i.e. bank receipts and cash receipts.
Karnataka 2nd PUC Accountancy Chapter 1 Accounting For Not-for-Profit Organisation
Twelve Marks Qs
Q1. “Income and Expenditure Account of a Not-for-Profit Organisation is akin to Profit and Loss Account of a business concern”. Explain the statement.
The account containing all expenses and losses for current accounting period prepared by a Not-for-profit organisation is called as Income and Expenditure (I & E) account, while a similar account prepared by profit earning organisation is called as Profit and Loss Account (P & L).
Here are some of the similarities between I & E and P & L accounts:
1. Accrual basis is followed for the preparation of both accounts.
2. Expenses and losses are recorded on Expenditure (debit) side and gains and income are recorded on Income (credit) side.
3. Records only revenue items related to current accounting period.
4. Both exhibit nature similar to nominal accounts
Therefore, it can be said that from the above statements that Income and Expenditure account of a Not-for-Profit Organisation is akin to Profit and Loss Account of a business concern.
Q2. Distinguish between Receipts and Payments Account and Income and Expenditure Account.
Basis of Comparison | Receipts and Payments Account | Income and Expenditure Account |
Nature | Contains bank and cash transaction summary. | Contains summary of income and expenses of current year |
Revenue and Capital | Both revenue and capital transactions are recorded | Only revenue transactions are recorded |
Debit Side | Records cash and bank receipts are recorded | Records expenses and losses incurred for the current accounting year |
Credit side | Records payments received in form of cash and cheques | Records incomes and gains during the current accounting year |
Account Type | Real Account | Nominal Account |
Accounting Period | Records receipts and payments made during the year which may be related to current, previous or next accounting year | Records only the expenditure and income made during the current accounting year |
Object | Shows the cash position of NPO | Shows the net results in terms of deficits or surplus |
Depreciation | Non-cash items like depreciation is not included | Includes non-cash items like depreciation, bad-debts for determining net profit or loss. |
Adjustment | Before preparing financial statements the Payments and Receipts received during the year can be adjusted. | Cash and non-cash transactions can be adjusted |
System | Cash basis | Accrual Basis |
Q3. Explain the basic features of Income and Expenditure Account and of Receipt and Payment Account.
Income and Expenditure account is similar to the P & L account (Profit and Loss Account). In an income and expenditure account surplus and deficit is determined during the accounting period while in a P& L account the net profit or loss is determined during an accounting period. It is a nominal account and records transactions that are of revenue nature. The closing balance is called deficit or surplus based.
Basic Features of I & E Account are:
1. It is a nominal account
2. Prepared on the basis of R & P (Receipt and Payment Account). All revenue items irrespective of income or expenditure get transferred.
3. Transactions that are of capital nature are not included in the account.
4. It is similar to P & L account
5. Records only current accounting year items and excludes any other transactions
6. Items like prepaid expenses, depreciation, income received in advance can be adjusted.
7. Balancing figure is expressed as surplus or deficit based on the status of expenses and income.
A receipts and payments account is a summary of actual cash receipts and payments that is extracted from the cash book over a certain time period. All the cash received is recorded on the Receipts and all cash payments are recorded in Payments side of the Receipts and Payments Account. This account is prepared on the basis of all the cash and bank transactions that are recorded in Cash Book. It records all cash and bank transactions that are of revenue and capital nature. It records all transactions i.e. bank receipts and cash receipts.
This account helps in determining the closing balance of bank and cash receipts and thereby assess cash position of an NPO.
Basic Features of R & P Account are:
1. It is a real account also known as summarised version of Cash Book
2. It records only bank and cash transactions.
3. Non-cash transactions like depreciation is not recorded
4. It begins with an opening balance of cash and bank and ends with closing balance of cash and bank.
5. Helps in assessing the cash position of an organisation
6. It does not distinguish between capital and revenue items
Kseeb Solutions For Class 12 Accountancy Chapter 1
Q4. Explain the statement: “Receipt and Payment Account is a summarised version of Cash Book”.
A receipts and payments account (R & P Account) is a summary of actual cash receipts and payments that is extracted from the cash book over a certain time period. All the cash received is recorded on the Receipts and all cash payments are recorded in Payments side of the R & P Account. All the cash and bank transactions are recorded in Cash Book and this book is created on the basis of all these transaction. All cash and bank transactions that are of revenue and capital nature gets recorded. It records all transactions i.e. bank receipts and cash receipts.
This account helps in determining the closing balance of bank and cash receipts and thereby assess cash position of a Not-for-profit organisation or NPO.
Here are some similarities between Cash Book and Receipts and Payments Account:
1. Both are real accounts.
2. Only transactions of cash and bank are recorded
3. There is no distinction between Revenue and Capital Items
4. Helps in assessing the cash position of an organisation
5. Starts with an opening balance consisting of cash and bank and concludes with closing balance of cash and bank.
Therefore, it can be said that Receipt and Payments Account is a summarised version of cash book.
Show the treatment of items of Income and Expenditure Account when there is a specific fund for those items.
A NPO (Not-for-Profit organisation) has different sources of receipts in the form of subscriptions, donations, government grants etc. Of these some receipts are general while some are specific. Specific receipts are used only for the purpose for which it is received while general receipts can be used for any purpose. The specific receipts are not considered as revenue income for the Not-for-Profit organisation and therefore are reflected in I & E account.
In a way, specific receipts are considered as liabilities to the Not-for-Profit organisation as these amounts are received for specific purpose and cannot be used elsewhere. These are reflected in Liabilities side of Balance Sheet, until and unless it is completely used for the purpose it was received. If such amount is invested in the form of shares or debentures, then it is known as funds such as prize funds, match funds etc. The interest earned on such investment are not credited to I & E Account, instead it is credited to the respective fund account.
Similarly, any expense that is incurred for such funds gets debited from respective fund account. Such funds are shown in the liabilities side of Balance Sheet. If the expenses exceed the receipts of the fund, the difference gets reflected in I & E Account.
Treatment for items received for specific purpose
(Tournament/Match/Prize, etc.) Fund Account
Dr. Cr.
Date | Particulars | L.F. | Amount | Date | Particulars | L.F. | Amount |
Expenses(expenses incurred like, match expenses, tournament expenses) | Balance b/d | ||||||
Incomes(Income or interest earned on funds invested in the form of donation, interests, dividends, etc.) | |||||||
Balance c/d(see explanation) | (a) | Income and Expenditure A/c (see explanation) | (b) |
Explanation (a)
When receipts are more than expenses meant for specific purpose, that time the difference between receipts and expenses is shown on balance sheet in the liabilities side.
Balance Sheet
Specific Fund (i.e. Tournament, Match, Prize Fund, etc.) | Tournament Fund Investment |
Explanation (b)
When expenses are more than receipts meant for specific purpose, that time the difference between expenses and receipts is shown in I & E account at the expenditure side.
Income and Expenditure A/c
Expenditure | Amount | Income | Amount |
Expenses(I.e. Tournament, Match, Prize Expenses etc. except capital expenditures like, i.e. expenses on construction of a building) | |||
Q5. Show the treatment of the following items by a Not-for-Profit Organisation:
(i) | Annual subscription |
(ii) | Specific donation |
(iii) | Sale of fixed assets |
(iv) | Sale of old periodicals |
(v) | Sale of sports materials |
(vi) | Life membership fee |
i) Annual Subscription
1. Subscriptions that are obtained during an accounting year (it may be related to current, previous or upcoming year) are reflected on the debit side of R & P Account.
2. Subscriptions related to the present year whether yet to be received or already received reflects on the credit side of I & E account (Income and Expenditure)
3. Advance subscriptions received for the following year are reflected on Liabilities side of balance sheet.
4. Subscriptions which are due but yet to be received are shown on Assets part of Balance Sheet.
5. Subscriptions that are due but yet to receive are reflected on asset side of balance sheet.
ii) Specific donation
1. Specific donation amount is reflected on Debit side of R & P Accounts.
2. Specific donation amount is shown on Liabilities side of Balance Sheet. Because it is used for that specific purpose for which it is received.
iii) Sale of fixed assets
1. Amount received recorded on debit side of R & P Account.
2. Profit/Loss is credited/debited to I & E Account.
3. Book value of asset deducted from the respective asset on Asset side of Balance Sheet
iv) Sale of old periodicals
1. Amount received reflects on the debit side of R & P Account.
2. Sale of old periodical is counted as revenue receipts, hence reflects on credit side of I & E Account.
v) Sale of sport Materials
1. Amount received is debited to R & P Account
2. Sport material sale is revenue earned, hence reflects on credit side of I & E Account.
vi) Life Membership Fees
1. It is considered as a receipt for a NPO. Hence, debited to R & P Account
2. It is one-time fee and hence treated as Capital receipts, hence, added to Capital Fund on liabilities side of Balance Sheet
Q6. From the following particulars taken from the Cash Book of a health club, prepare a Receipts and Payments Account.
Particulars | ₹ |
Opening balance: | |
Cash in Hand | 5,000 |
Cash at Bank | 25,000 |
Subscriptions | 1,65,000 |
Donations | 35,000 |
Investment Purchased | 80,000 |
Rent Paid | 20,000 |
General Expenses | 21,500 |
Postage and stationery | 2,000 |
Courier charges | 1,000 |
Sundry Expenses | 2,500 |
Closing Cash in Hand | 12,000 |
The solution for this question is as follows:
Books of Health ClubReceipt and Payment Account
Dr. Cr.
Receipts | Amount₹ | Payments | Amount₹ |
Balance b/d | Investment | 80,000 | |
Cash in Hand 5,000 Cash at Bank 25,000 | 30,000 | Rent | 20,000 |
General Expenses | 21,500 | ||
Subscriptions | 1,65,000 | Postage and Stationery | 2,000 |
Donations | 35,000 | Courier Charges | 1,000 |
Sundry Expenses | 2,500 | ||
Balance c/d | |||
Cash in Hand 12,000 Cast at Bank 91,000 | 1,03,000 | ||
(Balancing figure) | |||
2,30,000 | 2,30,000 |
Q7. The Receipt and Payment Account of Harimohan charitable institution is given:
Receipt and Payment Account for the year ending March 31, 2015
Receipts | Amount₹ | Payments | Amount₹ |
Balance b/d: | Furniture | 3,000 | |
Cash at Bank | 22,000 | Investments | 55,000 |
Cash in Hand | 8,800 | Advance for building | 20,000 |
Donations | 32,000 | Charities | 60,000 |
Subscriptions | 50,200 | Salaries | 10,400 |
Endowment Fund | 60,000 | Rent and Taxes | 4,000 |
Legacies | 24,000 | Printing | 1,000 |
Interest on Investment | 3,800 | Postage | 300 |
Interest on Deposits | 800 | Advertisements | 1,100 |
Sale of old newspapers | 500 | Insurance | 4,800 |
Balance c/d: | |||
Cash at Bank | 32,000 | ||
Cash in Hand | 10,500 | ||
2,02,100 | 2,02,100 |
Prepare the Income and Expenditure Account for the Year ended on March 31, 2015 after considering the following:
(i) | It was decided to treat Fifty per cent of the amount received on account of Legacies and Donations as income. |
(ii) | Liabilities to be provided for are: |
Rent ₹ 800; Salaries ₹ 1,200; advertisement ₹ 200. | |
(iii) | ₹ 2,000 due for interest on investment was not actually received. |
The solution for this question is as follows
Books of Harimohan Charitable InstitutionIncome and Expenditure Account
Dr. Cr.
Expenditure | Amount₹ | Income | Amount₹ |
Rent and Taxes 4,000 | Donations | 16,000 | |
Add: Outstanding 800 | 4,800 | Legacies | 12,000 |
Subscriptions | 50,200 | ||
Salaries | 10,400 | Interest on Investment 3,800 | |
Add: Outstanding | 1,200 | Add: Accrued Interest 2,000 | 5,800 |
Advertisement 1,100 | Interest on Deposits | 800 | |
Add: Outstanding 200 | 1,300 | Sale of Old Newspapers | 500 |
Charities | 60,000 | ||
Printing | 1,000 | ||
Postage | 300 | ||
Insurance | 4,800 | ||
Surplus (Excess of Income over Expenditure) | 1,500 | ||
85,300 | 85,300 |
Q8. From the following particulars, prepare Income and Expenditure account:
Details | Amount ₹ |
Fees collected, including ₹ 80,000 on account of the previous year | 5,20,000 |
Fees for the year outstanding | 30,000 |
Salary paid, including ₹ 5,000 on account of the previous year | 68,000 |
Salary outstanding at the end of the year | 3,000 |
Entertainment expenses | 8,000 |
Tournament expenses | 25,000 |
Meeting Expenses | 18,000 |
Traveling Expenses | 7,000 |
Purchase of Books and Periodicals, including ₹ 31,000 for purchase of Books | 40,000 |
Rent | 15,000 |
Postage, telegrams and telephones | 6,000 |
Printing and Stationery | 18,000 |
Donations received | 25,000 |
The solution for this question is as follows
Income and Expenditure Account
Dr. Cr.
Expenditure | Amount₹ | Income | Amount₹ | ||
Salaries | 68,000 | Fees Collected | 5,20,000 | ||
Less: Previous year’s Outstanding | (5,000) | Less: Previous year’s Outstanding | (80,000) | ||
63,000 | 4,40,000 | ||||
Add: Current year’s Outstanding | 3,000 | 66,000 | Add: Current year’s Outstanding | 30,000 | 4,70,000 |
Entertainment Expenses | 8,000 | Donations | 25,000 | ||
Tournament Expenses | 25,000 | ||||
Meeting Expenses | 18,000 | ||||
Traveling Expenses | 7,000 | ||||
Purchases of Periodicals (40,000 – 31,000) | 9,000 | ||||
Postage, Telegrams and Telephone’s | 6,000 | ||||
Rent | 15.000 | ||||
Printing and Stationery | 18,000 | ||||
Surplus (Excess of Income over Expenditure) | 3,23,000 | ||||
4,95,000 | 4,95,000 |
NOTE: As per the solution, Excess of Income over Expenditure is ₹ 3, 23,000; however, as per the book, it is ₹ 3, 07,000.
Q9. Following is the information given in respect of certain items of a Sports Club. Show these items in the Income and Expenditure Account and the Balance Sheet of the Club:
Particulars | ₹ |
Sports Fund as on 1.4.2015 | 35,000 |
Sports Fund Investments | 35,000 |
Interest on Sports Fund | 4,000 |
Donations for Sports Fund | 15,000 |
Sports Prizes awarded | 10,000 |
Expenses on Sports Events | 4,000 |
General Fund | 80,000 |
General Fund Investments | 80,000 |
Interest on General Fund Investments | 8,000 |
The solution for this question is as follows
Books of Sports Club
Income and Expenditure Account
Dr. Cr.
Expenditure | Amount₹ | Income | Amount₹ |
Interest on General Fund Investments | 8,000 | ||
Balance Sheet
Liabilities | Amount₹ | Amount₹ | Assets | Amount₹ |
Sports Fund | 35,000 | Sports Fund Investments | 35,000 | |
Add: Interest on Sports Fund | 4,000 | General Fund Investments | 80,000 | |
Add: Donations for Sports Fund | 15,000 | Cash (b/f) | 5000 | |
54,000 | ||||
Less: Expenses on Sports Event | (4,000) | |||
Less: Prize Awarded | (10,000) | 40,000 | ||
General Fund | 80,000 | |||
1,20,000 | 1,20,000 |
Q10. How will you deal with the following items while preparing for the Bombay Women Cricket Club its income and expenditure account for the year ending 31.3.2017 and its Balance Sheet as on 31.3.2017?
(a) | Donation received during the year for the construction of a permanent Pavilion | 12,25,000 |
Expenditure incurred up to 31.3.2017 on its construction | 10,80,000 | |
The total estimated expenditure on construction of Pavilion being | 25,00,000 | |
(b) | Tournament Fund: | |
Balance as on 1.4.2016 | 10,700 | |
Subscriptions for tournament received during the year | 65,800 | |
Expenditure incurred during the year on conducting tournaments | 72,400 | |
(c) | Life Membership fee received during the year | 28,000 |
Give reasons for your answers
The solution for this question is as follows
(a)
Books of Bombay Women Cricket ClubBalance Sheet as on March 31, 2017
Liabilities | Amount₹ | Assets | Amount₹ |
Donation for Pavilion | 12,25,000 | Construction of Pavilion in Progress | 10,80,000 |
Less: Exp. on construction of Pavilion | (10,80,000) | ||
Add: Pavilion Construction | 1,45,000 |
Reason:
Donation for the construction of Pavilion is a donation for a specific purpose.
Expenses on construction on Pavilion is a capital expenditure.
(b)
Balance Sheet as on March 31, 2017
Liabilities | Amount₹ | Assets | Amount₹ |
Tournament Fund 10,700 | |||
Add: Subscription for Tournament 65,800 | |||
76,500 | |||
Less: Tournament Expenses (72,400) | 4,100 | ||
Reason
All funds received are treated as capital receipts and expenses related to any fund are deduced from the concerned funds.
(c)
Balance Sheet as on March 31, 2017
Liabilities | Amount₹ | Assets | Amount₹ |
Life Membership Fees | 28,000 |
Reason
When there is no specific information on treatment of Life Membership fees, it is shown on liabilities side of Balance sheet as it is considered as capital receipt. On treated as revenue, it is shown in credit side of I & E Account.
Q11. From the following receipts and payments and information given below, Prepare Income and Expenditure Account and opening Balance Sheet of Adult Literacy Organisation as on December 31, 2017.
Receipt and Payment Account for the year ending as on December 31, 2017
Receipts | Amount₹ | Payments | Amount₹ | |
Balance b/d | General Expenses | 3,200 | ||
Cash in hand | 4,000 | Newspaper | 1,850 | |
Cash at Bank | 15,550 | Electricity | 3,000 | |
Subscriptions | Fixed deposit with bank(on 31.06.2017) @ 10% p.a. | 18,000 | ||
2016 | 1,200 | |||
2017 | 26,500 | Books | 7,000 | |
2018 | 500 | 28,200 | Salary | 3,600 |
Sale of old newspapers | 1,250 | Rent | 6,500 | |
Govt. grant | 12,000 | Postage charges | 300 | |
Sale of old furniture (book value ₹ 5, 000) | 3,700 | Furniture (purchased) | 10,500 | |
Interest received on FD | 450 | Balance c/d | ||
Cash in Hand | 3,000 | |||
Cash at Bank | 8,200 | |||
65,150 | 65,150 |
Information:
(i) Subscription outstanding as on 31.12.2016 ₹ 2,000 and on December 31, 2017 ₹ 1,500.
(ii) On December 31, 2017 Salary outstanding ₹ 600, and one month Rent paid in advance.
(iii) On Jan. 01, 2016 organisation owned Furniture ₹ 12,000, Books ₹ 5,000.
The solution for this question is as follows:
Books of Adult Literacy OrganisationIncome and Expenditure Account as on Dec. 31, 2017
Dr. Cr.
Expenditure | Income | ||
Loss on Sale of Old Furniture | Subscription | 26,500 | |
General Expenses | Add: Outstanding for 2017 | 1,500 | |
Newspapers | Sale of Old Newspapers | ||
Electricity | Government Grant | ||
Salary | 3,600 | Interest received on F.D. | 450 |
Add: Outstanding for 2017 | 600 | Add: Accrued Interest | 450 |
Rent | 6,500 | ||
Less: Prepaid for 2018 {6,500×(1/13)} | (500) | ||
Postages Charges | |||
Surplus (Excess of Income over Expenditure) | |||
Balance Sheet as on Dec. 31, 2016 | |||
Liabilities | Amount₹ | Assets | Amount₹ |
Capital Fund on Dec. 31, 2016 (Balancing Figure) | 38,550 | Subscription Outstanding | 2,000 |
Cash in Hand | 4,000 | ||
Cash at Bank | 15,550 | ||
Furniture | 12,000 | ||
Books | 5,000 | ||
38,550 | 38,550 |
Balance Sheet as on Dec. 31, 2017
Liabilities | Amount ₹ | Assets | Amount ₹ | ||
Capital | 38,550 | Prepaid Rent | 500 | ||
Add: Surplus | 22,300 | 60,850 | Books | 5,000 | |
Add: Purchases | 7,000 | 12,000 | |||
Salary Outstanding | 600 | ||||
Subscription Received in Advance for 2018 | 500 | Furniture | 12,000 | ||
Add: Purchases | 10,500 | ||||
22,500 | |||||
Less: Sale | (5,000) | 17,500 | |||
Fixed Deposit | 18,000 | ||||
Add: Accrued Interest | 450 | 18,450 | |||
Cash in Hand | 3,000 | ||||
Cash at Bank | 8,200 | ||||
Subscription Outstanding for 2017 | 1,500 | ||||
Add: Outstanding for 2016 | 800 | 2,300 | |||
61,950 | 61,950 |
Q12. Following is the Receipt and Payment Account of Indian Sports Club, prepared Income and Expenditure Account, Balance Sheet as on December 31, 2017:
Receipt and Payment Account for the year ending December 31, 2017
Receipts | Amount₹ | Payments | Amount₹ |
Balance b/d | 7,890 | Salary | 11,000 |
Subscriptions | 52,000 | Electric charges | 5,500 |
Life membership fee | 2,200 | Billiard Table | 17,500 |
Entrance fee | 3,200 | Office expenses | 4,100 |
Tournament fund | 26,000 | Printing and Stationery | 2,300 |
Locker Rent | 1,250 | Tournament expenses | 18,500 |
Sale of old sports goods (Costing ₹ 2,200) | 2,500 | Repair of ground | 2,000 |
Sale of Old Newspaper | 750 | Furniture purchased | 7,700 |
Legacy | 37,500 | Sports equipment’s | 12,000 |
Cash in Hand | 12,690 | ||
Cash at Bank | 10,000 | ||
Fixed Deposit (on 1.10.17 for 10% p.a) | 30,000 | ||
1,33,290 | 1,33,290 |
Other Information:
Subscription outstanding was on December 31, 2016 ₹ 1,200 and ₹ 3,200 on December 31, 2017. Locker rent outstanding on December 31, 2017 ₹ 250. Salary outstanding on December 31, 2017 ₹ 1,000.
On January 1, 2017, club has Building ₹ 36,000, furniture ₹ 12,000, and Sports equipment’s ₹ 17,500. Depreciation charged on these items @ 10% (including Purchase).
The solution for this question is as follows:
Indian Sports ClubIncome and Expenditure Account as on Dec. 31, 2017
Dr. Cr.
Expenditure | Amount₹ | Amount₹ | Income | Amount₹ | Amount₹ |
Salary | 11,000 | Subscriptions | 52,000 | ||
Add: Outstanding for 2017 | 1,000 | 12,000 | Add: Outstanding for 2017 | 3,200 | |
Electric Charges | 5,500 | 55,200 | |||
Office Expenses | 4,100 | Less: Outstanding for 2016 | (1,200) | 54,000 | |
Printing and Stationery | 2,300 | ||||
Repair of Ground | 2,000 | Locker Rent | 1,250 | ||
Depreciation on: | Add: Outstanding for 2017 | 250 | 1,500 | ||
Furniture | 1,970 | ||||
Building | 3,600 | Entrance Fees | 3,200 | ||
Sports Equipments | 2,730 | 8,300 | Profit on Sale of Sports | ||
Surplus | 26,300 | Equipments (₹ 2,500 – ₹ 2,200) | 300 | ||
Sale of Old Newspapers | 750 | ||||
Accrued Interest | 750 | ||||
60,500 | 60,500 |
Balance Sheet as on January 01, 2016
Liabilities | Amount₹ | Assets | Amount₹ | ||
Capital Fund (Balancing Figure) | 74,590 | Subscription Outstanding | 1,200 | ||
Building | 36,000 | ||||
Furniture | 12,000 | ||||
Sports Equipments | 17,500 | ||||
Cash and Bank | 7,890 | ||||
74,590 | 74,590 | ||||
Balance Sheet as on Dec. 31, 2017 | |||||
Liabilities | Amount₹ | Assets | Amount₹ | ||
Salary Outstanding | 1,000 | Subscripting Outstanding | 3,200 | ||
Tournament Fund | 26,000 | Locker Rent Outstanding | 250 | ||
Less: Tournament Expenses | 18,500 | 7,500 | Building | 36,000 | |
Less: 10% Depreciation | (3,600) | 32,400 | |||
Capital fund | 74,590 | ||||
Add: Life Membership Fee | 2,200 | Furniture | 12,000 | ||
Add: Legacy | 37,500 | Add: Purchases | 7,700 | ||
Add: Surplus | 26,300 | 1,40,590 | 19,700 | ||
Less: 10% Depreciation | (1,970) | 17,730 | |||
Sports Equipments | 17,500 | ||||
Add: Purchases | 12,000 | ||||
29,500 | |||||
Less: Sales | (2,200) | ||||
27,300 | |||||
Less: 10% Depreciation | (2,730) | 24,570 | |||
Billiard Table | 17,500 | ||||
Cash in hand | 12,690 | ||||
Cash at Bank | 10,000 | ||||
Fixed Deposit | 30,000 | ||||
Add: Accrued Interest | 750 | 30,750 | |||
1,49,090 | 1,49,090 |
2nd Puc Accountancy Chapter 1 Notes
Q13. As at March 31, 2017 the following balances have been extracted from the books of the Indian Chartered Accountants Recreation Club and you are asked to prepare (1) Trading Account for ascertaining gross profit derived from running restaurant and dining room and (2) Income and Expenditure Account for the year ended March 31, 2017 (3) and a Balance Sheet as at that date.
Debit Balances | ₹ | Credit Balances | ₹ |
Stock-in-hand | 1170 | Receipts Dining Room | 87,660 |
Purchases | 24,660 | Subscriptions | 9,450 |
Dining Room | 32,370 | Billiard’s Receipts | 7,300 |
Rent | 10,470 | Sunday Receipts | 410 |
Wages | 18,690 | Interest on Fixed Deposit | 270 |
Repairs and Renewals | 5,400 | Sundry Creditors | 5310 |
Fuel and Light | 5,280 | Grant from Institute (permanent) | 42,000 |
Misc. Expenses | 4,050 | Income and Exp. A/c (1.4.16) | 1,380 |
Cash in hand | 560 | Suspense A/c (See note) | 60 |
Cash at bank | 2,760 | ||
Fixed Deposit | 8,500 | ||
Sundry Debtors | 2,250 | ||
China glass, cutlery and linen | 600 | ||
Billiard Table | 2,070 | ||
Fixtures and Fittings | 870 | ||
Furniture | 4,140 | ||
Club Premises | 30,000 | ||
1,53,840 | 1,53,840 |
On March 31, 2016 stock of restaurant consisted of ₹ 900 and ₹ 60 respectively. Provide depreciations ₹ 60 on fixtures and fittings, ₹ 390 on billiard table and ₹ 560 on furniture.
The solution for this question is as follows:
Books of Indian Chartered Accountants Recreation ClubRestaurant Trading Account
Dr. Cr.
Particulars | Amount₹ | Particulars | Amount₹ |
Opening Stock | 1,170 | Receipts from Dining Room | 87,660 |
Purchases | 24,660 | Closing Stock | 960 |
Dining Room Exp. | 32,370 | ||
Profit from Restaurant | 30,420 | ||
88,620 | 88,620 | ||
Income and Expenditure Account as on March 31, 2017 | |||
Dr. | Cr. | ||
Expenditure | Amount ₹ | Income | Amount₹ |
Rent | 10,470 | Subscriptions | 9,450 |
Wages | 18,690 | Sundry Receipts | 410 |
Repairs an Renewals | 5,400 | Interest on Fixed Deposits | 270 |
Fuel and Light | 5,280 | Profit from Restaurant | 30,420 |
Misc. Expenses | 4,050 | Billiards Receipts | 7,300 |
Depreciation on | |||
Fixtures and Fittings 60 | |||
Billiards Table 390 | |||
Furniture 560 | 1,010 | ||
Surplus (Excess of Income over Expenditure) | 2,950 | ||
47,850 | 47,850 |
Balance Sheet as on March 31, 2017
Liabilities | Amount₹ | Assets | Amount₹ | ||
Sundry Creditors | 5,310 | Cash in Hand | 560 | ||
Grant from Institute | 42,000 | Cash at Bank | 2,760 | ||
Suspense | 60 | Fixed Deposit | 8,500 | ||
Capital Fund (Income and Exp. A/cas on Apr.01, 2016) | 1,380 | Sundry Debtors | 2,250 | ||
Add: Surplus | 2,950 | 4,330 | China Glass, Cutlery and Linen | 600 | |
Billiards Table | 2,070 | ||||
Less: Depreciation | (390) | 1,680 | |||
Fixture and Fittings | 870 | ||||
Less: Depreciation | (60) | ||||
Furniture | 4,140 | ||||
Less: Depreciation | (560) | 3,580 | |||
Club Premises | 30,000 | ||||
Stock of Restaurant | 960 | ||||
51,700 | 51,700 |
Q14. Following is the Receipt and Payment Account of Women’s Welfare Club for the year ended December 31, 2017:
The solution for this question is as follows:
Receipt and Payment Account for the year ending December 31, 2017
Receipts | Amount₹ | Payments | Amount₹ |
Balance b/d | 7,250 | Salary | 12,500 |
Subscriptions | 81,750 | Stationery | 1,700 |
Donations | 3,000 | Electricity charges | 9,550 |
Grant from Government | 15,000 | Insurance | 7,500 |
Sale of newspapers | 300 | Equipment | 30,000 |
Proceeds of charity show | 16,500 | Petty expenses | 500 |
Interest on investments @ 10% for full year | 7,000 | Expenses on a charity show | 12,900 |
Sundries income | 400 | Newspapers | 1,000 |
Lectures fee | 16,500 | ||
Honorarium to Secretary | 12,000 | ||
Balance c/d | 27,050 | ||
1,31,200 | 1,31,200 |
Additional Information:
01.01.2017₹ | 31.12.2017₹ | |
Outstanding salaries | 1,200 | 1,800 |
Insurance prepaid | 700 | 300 |
Subscription outstanding | 3,750 | 2,500 |
Subscription received in advanced | 1,750 | 1,000 |
Electricity charges outstanding | — | 1,250 |
Stock of stationery | 2,250 | 700 |
Equipments | 25,600 | 50,200 |
Building | 1,20,000 | 1,14,000 |
Prepare Income and Expenditure Account for the year ended December 31, 2017 and Balance Sheet as on that date.
The solution for this question is as follows:
Books of Women Welfare Club Income and Expenditure as on December 31, 2017
Dr. Cr.
Expenditure | Amount₹ | Income | Amount ₹ | ||
Salary | 12,500 | Subscriptions | 81,750 | ||
Add: O/s on Dec. 31, 2017 | 1,800 | Add: O/s on Dec. 31, 2017 | 2,500 | ||
14,300 | 84,250 | ||||
Less: O/s on Dec. 31, 2016 | (1,200) | 13,100 | Less: O/s on Dec. 31, 2016 | (3,750) | |
80,500 | |||||
Stationery | 1,700 | Add: Advance on Dec. 31, 2016 | 1,750 | ||
Add: Opening Stock | 2,250 | 82,250 | |||
3,950 | Less: Advance on Dec.31, 2017 | (1,000) | 81,250 | ||
Less: Closing Stock | (700) | 3,250 | |||
Donations | 3,000 | ||||
Electric Charges | 9,550 | Grant from Government | 15,000 | ||
Add: O/s on Dec. 31, 2017 | 1,250 | 10,800 | Sale of Newspapers | 300 | |
Profit from Charity show (16,500–12,900) | 3,600 | ||||
Insurance | 7,500 | Interest on Investments | 7,000 | ||
Add: Prepaid in 2016 | 700 | Sundries Income | 400 | ||
8,200 | |||||
Less: Prepaid in 2017 | (300) | 7,900 | |||
Depreciation on Equipments | 5,400 | ||||
Petty Expenses | 500 | ||||
Newspapers | 1,000 | ||||
Lectures Fee | 16,500 | ||||
Honorarium to Secretary | 12,000 | ||||
Depreciation on Building | 6,000 | ||||
Surplus (Balancing Figure) | 34,100 | ||||
1,10,550 | 1,10,550 |
Balance Sheet as on December 31, 2016
Liabilities | Amount₹ | Assets | Amount₹ |
Outstanding Salaries | 1,200 | Insurance Prepaid | 700 |
Subscription in Advance | 1,750 | Subscription Outstanding | 3,750 |
Stock of Stationery | 2,250 | ||
Capital Fund (Balancing Figure) | 2,26,600 | Equipments | 25,600 |
Building | 1,20,000 | ||
Cash and Bank | 7,250 | ||
Investments {7,000 × (100/10)} | 70,000 | ||
2,29,550 | 2,29,550 |
Balance Sheet as on December 31, 2016
Liabilities | Amount₹ | Assets | Amount₹ | ||
Outstanding Salaries | 1,800 | Equipments | 25,600 | ||
Subscription in Advance | 1,000 | Add: Purchases | 30,000 | ||
Electricity Charges Outstanding | 1,250 | 55,600 | |||
Capital Fund | 2,26,600 | Less: Depreciation | (5,400) | 50,200 | |
Add: Surplus | 34,100 | 2,60,700 | |||
Insurance Prepaid | 300 | ||||
Subscription Outstanding | 2,500 | ||||
Stock of Stationery | 700 | ||||
Building | 1,20,000 | ||||
Less: Depreciation | (6,000) | 1,14,000 | |||
Cash and Bank | 27,050 | ||||
Investments | 70,000 | ||||
2,64,750 | 2,64,750 |
Q15. Following Receipt and Payment Account was prepared from the cash book of Delhi Charitable Trust for the year ending December 31, 2017
Receipt and Payment Account for the year ending December 31, 2017
Receipts | Amount₹ | Payments | Amount₹ |
Balance b/d | Charity | 11,500 | |
Cash in hand | 11,500 | Rent and taxes | 3,200 |
Cash at bank | 12,600 | Salary | 6,000 |
Donation | 9,000 | Printing | 600 |
Subscription | 42,800 | Postage | 300 |
Legacies | 18,000 | Advertisements | 4,500 |
Interest on investment | 4,500 | Insurances | 2,000 |
Sale of old newspapers | 200 | Furniture | 21,600 |
Investment | 23,000 | ||
Balance c/d: | |||
Cash in hand | 9,900 | ||
Cash at bank | 16,000 | ||
98,600 | 98,600 |
Prepare Income and expenditure account for the year ended December 31, 2017, and a balance sheet as on that date after the following adjustments:
(a) | It was decided to treat one-third of the amount received on account of donation as income. |
(b) | Insurance premium was paid in advance for three months. |
(c) | Interest on investment ₹1,100 accrued was not received. |
(d) | Rent ₹600: salary ₹900 and advertisement expenses ₹1,000 outstanding as on December 31, 2017. |
The solution for this question is as follows:
Books of Delhi Charitable TrustIncome and Expenditure Account as on December 31, 2017
Dr. Cr.
Expenditure | Amount ₹ | Income | Amount ₹ | ||
Insurance | 2,000 | Donation {9,000 × (1/3)} | 3,000 | ||
Less: Prepaid {2,000 × (3/15)} | (400) | 1,600 | Interest on Investments | 4,500 | |
Add: Accrued Interest | 1,100 | 5,600 | |||
Charity | 11,500 | ||||
Rent and Taxes | 3,200 | Subscription | 42,800 | ||
Add: Outstanding | 600 | Sale of Old Newspapers | 200 | ||
Salary | 6,000 | ||||
Add: Outstanding | 900 | 6,900 | |||
Printing | 600 | ||||
Postage | 300 | ||||
Advertisements | 4,500 | ||||
Add: Outstanding | 1,000 | 5,500 | |||
Surplus (Balancing figure) | 21,400 | ||||
51,600 | 51,600 | ||||
Balance Sheet as on December 31, 2016 | |||||
Liabilities | Amount₹ | Assets | Amount₹ | ||
Capital Fund (Balancing figure) | 24,100 | Cash in Hand | 11,500 | ||
Cash at Bank | 12,600 | ||||
24,100 | 24,100 | ||||
Balance Sheet as on December 31, 2017
Liabilities | Amount₹ | Assets | Amount₹ | ||
Capital Fund | 24,100 | Prepaid Insurance {2,000 × (3/15)} | 400 | ||
Add: Donation {9,000 × (2/3) | 6,000 | Investment | 23,000 | ||
Add: Legacies | 18,000 | Add: Accrued Interest | 1,100 | 24,100 | |
Add: Surplus | 21,400 | 69,500 | Furniture | 21,600 | |
Rent Outstanding | 600 | Cash in Hand | 9,900 | ||
Salary Outstanding | 900 | Cash at Bank | 16,000 | ||
Advertisement Expenses Outstanding | 1,000 | ||||
72,000 | 72,000 |
Q16. Receipt and Payment Account of Maitrey Sports Club showed that ₹ 68,500 were received by way of subscriptions for the year ended on March 31, 2017.
The additional information was as under:
1. Subscription Outstanding as on March 31, 2016 were ₹ 6,500,
2. Subscription received in advance as on March 31, 2016 were ₹ 4,100,
3. Subscription Outstanding as on March 31, 2017 were ₹ 5,400,
4. Subscription received in advance as on March 31, 2017 were ₹ 2,500.
Show how that above information would appear in the final accounts for the year ended on March 31, 2017 of Maitrey Sports Club.
The solution for this question is as follows:
Books of Maitrey Sports ClubIncome and Expenditure Account as on March 31, 2017
Dr. Cr.
Expenditure | Amount ₹ | Income | Amount₹ | |
Subscription | 68,500 | |||
Less: O/s on Mar. 31, 2016 | (6,500) | |||
62,000 | ||||
Add: Advance on Mar. 31, 2016 | 4,100 | |||
Add: O/s on Mar. 31, 2017 | 5,400 | |||
71,500 | ||||
Less: Advance on Mar. 31, 2017 | (2,500) | 69,000 | ||
Balance Sheet as on March 31, 2016 | ||||
Liabilities | Amount₹ | Assets | Amount₹ | |
Subscription in Advance | 4,100 | Subscription Outstanding | 6,500 |
FAQ:
A: Public Hospitals.
A: Accrual Basis of Accounting.
A: Right-hand side.
ಇತರೆ ವಿಷಯಗಳು:
1 ರಿಂದ 12ನೇ ತರಗತಿ ಎಲ್ಲಾ ಪಠ್ಯಪುಸ್ತಕಗಳ Pdf
1 ರಿಂದ 9ನೇ ತರಗತಿ ಕಲಿಕಾ ಚೇತರಿಕೆ
1 ರಿಂದ 12 ನೇ ತರಗತಿ ಎಲ್ಲಾ ನೋಟ್ಸ್