Practical Problem 07
SOLUTION:
In the books of Pavan-putra Hanuman Vyayamshala, Parbhani
Income and Expenditure Account for the year ended on 31st March, 2019 | |||||
Expenditure | Amt ₹ | Amt ₹ | Income | Amt ₹ | Amt ₹ |
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 | Amt ₹ | Amt ₹ | Assets | Amt ₹ | Amt ₹ |
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 Adv. | 410 | Investments | 15,000 | ||
O/s Interest on Investments | 375 | ||||
Fixed Deposit | 3,900 | ||||
Cash in Hand | 830 | ||||
Cash at Bank | 6,000 | ||||
O/s Subscription of C.Y | 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.