Following is the Balance Sheet as on 1.4.2012 and receipts and payments account of Mahakavi Kalidas Library, Nashik.

Following is the Balance Sheet as on 1.4.2012 and receipts and payments account of Mahakavi Kalidas Library, Nashik.

Solution: In the books of Mahakavi Kalidas Library, Nashik

Income and Expenditure Account for the year ended 31.3.2013

Expenditure
Amount
Amount
Payments
Amount
Amount
To Electricity Charges

6980
By Members Subscription
180000

To Postage and Telegram

6100
Add: Outstanding Subscription
7500

To Sundry Expenses

10500
Less: Pre - received Subscription
15000
172500
To Depreciation:


By Entrance Fees
25000

Furniture
8650

Less: Capitalised
12500
12500
Books
100000
108650
By Sale of Old Newspapers

1500



By Hire of lecture hall

18000



By Interest on securities

4000
To Income Over Expenditure [Surplus]

76270





208500


208500

Balance Sheet of Mahakavi Kalidas Library as on 31.3.2013


Liabilities
Amount
Amount
Assets
Amount
Amount
Capital Fund
690000

Furniture
72500

Add: Entrance Fees
12500

Add: Purchased
28000

Add: Surplus
76270
778770

100500

Pre - received Subscription

15000
Less: Depreciation
8650
91850



Books
551000




Add: Purchased
80000





631000




Less: Depreciation
100000
531000



Investment in securities
50000




Add: Purchased
100000
150000



Cash inHand

6420



Cash at Bank

7000



Outstanding Subscription

7500


793770


793770

17 comments:

  1. How come the Depreciation on Furniture is 8650? I got it 5025. I calculated it as- 100500×10/100×6/12.

    ReplyDelete
    Replies
    1. Depreciation is to be calculated on 72,500 @10% for complete year and which comes to 7250. And on according to the adjustment given in the problem it says that 10% depreciation should be charged for 6 months as it was purchased on 1 october on rs 28000 which comes rs.1400 and therefore total amount of depreciation on furniture is 7250+1400=8650.

      Delete
  2. It is correct calculate it as 2800×10/100×6/12 then of previous 72500×10/100 add both you will get

    ReplyDelete
  3. Plz tell me where is payment of expens due gone??

    ReplyDelete
    Replies
    1. It has been paid as you can see on payment side

      Delete
    2. It is canled bcz it is give in liability side also and in payment side also

      Delete
  4. This comment has been removed by the author.

    ReplyDelete
  5. From where did interest on investments come??

    ReplyDelete
  6. Replies
    1. Expense due is paid of the last year in current year...so we can ignore that amount

      Delete
  7. Furniture 72500*10/100=7250
    additional furniture ...purchased on 1 oct 2012
    28000*6/12*10/100=1400
    So,7250+1400 = 8650.

    ReplyDelete
  8. Thanks yarrrrr...

    ReplyDelete
  9. How entrance fees are capitalized

    ReplyDelete