From the following, prepare an Income and Expenditure Account for the year ended 31st March, 2011:

Subscriptions include Rs 1,200 for 2009-10. Also rent includes Rs 500 paid for March, 2010. Subscriptions amounting to Rs 1,500 have still to be collected for the year 2010-2011. Rent for March, 2011 is still to be paid and Rs 250 is outstanding against a stationery bill. The book value of the scooter was Rs 8,200.

Solution:

Income and Expenditure Account for the Year ended March 31, 2011:

If, in the above illustration, one is required to prepare a Balance Sheet as on March 31, 2011, one will have to first find out the Capital Fund of the institution.

This can be done by preparing Balance Sheet as at March 31, 2010 as follows:

Having determined the Capital Fund in the beginning, one can now prepare the Balance Sheet as at March 31, 2011 as follows:

The following is the receipts and payments account of Entertainment Club for the year ended 31st March, 2011:

The following additional information is provided to you:

(i) On 31st March, 2011, apart from cash in hand and at Bank as shown in receipts and payments account, the club held the following assets:

Furniture Rs 1,80,000; Equipment’s Rs 1,20,000; Fixed Deposits with Bank Rs 3,00,000; Entertainment Material Rs 49,000; Stock of Stationery Rs 1,000; Subscriptions in Arrear Rs 15,000 and Unexpired Insurance Rs 5,600.

The club had no liability on that date.

(ii) The club has 220 members, each paying Rs 3,000 as yearly subscription.

(iii) On 31st March, 2011 stock of entertainment material was valued at Rs 52,000. Stock of stationery with the club on that date was Rs 2,100. Rent amounting to Rs 9,000 for March, 2011 was outstanding on that date.

Working Notes:

(i) Calculation of capital fund in the beginning of the year: