What is ‘Balance Sheet’? - Book Keeping and Accountancy

प्रश्न

What is ‘balance sheet’?

उत्तर

A Balance Sheet is a statement which contains all the assets and liabilities of the business enterprise. It helps in knowing the exact financial position of the business. Liabilities are shown on the left-hand side of the Balance Sheet whereas Assets are shown on the right-hand side.

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Preparation of Income and Expenditure Account and Closing Balance Sheet

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2013-2014 (October) (with solutions)

Q 1.1.1 | 1 mark

संबंधित प्रश्न

Following is the Balance Sheet and Receipts and Payments Account of the Sevagiri Hospital, Satara.

Prepare Income and Expenditure account for the year ended on 31 st March, 2013 and Balance Sheet as on that date :

Balance Sheet as on 1st April, 2012

Liabilities	Amount (Rs.)	Assets	Amount (Rs.)
Capital fund	1000000	Cash in hand	6000
Outstanding Salaries	22000	Cash at bank	30000
Medical bill unpaid	6000	Land and building	800000
		Furniture	70000
		Equipments	120000
		Outstanding Subscription	2000
	1028000		1028000

Receipts and Payments Account for the year ending 31.03.2013

Dr.			Cr.
Receipts	Amount (Rs.)	Payments	Amount (Rs.)
To Balance b/d Cash in hand Cash at bank	6000 30000	By Salaries (including of previous year)	110000
To Subscription (includes 2000 received for previous year)	130000	By Medicines	48000
To Sale of old furniture (book value Rs. 30000)	20000	By Equipment purchased	20000
To Donations (revenue)	44000	By Taxes	3000
To Life membership fees	25000	By General expenses	8600
		By Balance c/d Cash in hand Cash at bank	15400 50000
	255000		255000

Consider the following adjustments :

Outstanding subscription Rs. 15,000.
Capitalise the amount of life membership fees.
Pre-paid taxes Rs. 500.
Outstanding salary Rs. 12,000.
Write off depreciation Rs. 20,000 from land and building and Rs. 30,000 from equipments.
Outstanding medicine bill as on 01.04.2012 is still due.

Marathi Vishwa Kosha Centre, Wai, has given you the following information from which, you are required to prepare. (i) Income and Expenditure Account for the year ending on 31.03.2013, (ii) Balance Sheet as on 31.03.2013.
Receipts and Payment Account for the year ending 31.03.2013

Receipts	Amount (Rs.)	Payments	Amount (Rs.)
To Balance b/d		By Stationery	5000
Cash in hand	13000	By Furniture [Purchased on 01.01.2013]	50000
To Locker Rent	5000	By Investments	1,00,000
To Entrance Fees	19000	By Expenses of Drama	33500
To Sale of old newspapers	1500	By Postage and telegram	2,500
To Receipts from Drama	78,500	By Magazines and Newspapers	4000
To Legacies	1,10,000	By Salaries	22,000
To Miscellaneous Receipts	8000	By Balance c/d
		Cash in Hand	3000
		Cash at bank	1,10,000
	330000		330000

Additional Information:

(1) Capital fund on 01.04.2012, was Rs. 1,08,000.

(2) Legacies are to be capitalized.

(3) Outstanding salary Rs. 3,000.

(4) 50% of entrance fees is to be capitalized.

(5) Depreciation on Furniture @ 10% p.a.

What is 'deficit'?

Following is the Receipts and Payments Account of Chamber of Commerce, Amaravati for the year ending 31st March 2012 and some additional information.

Receipts and Payments Account For the year ended March 31, 2012
Receipts	Amount	Payment	Amount
To balance b/d (Cash at bank)	11,960	By Printing and Stationery	6,950
To Subscription (Including Rs. 2,500 for 2010–11)	36,500	By Repairs	2,100
To Sale of furniture (Books value Rs. 18,000)	12,000	By Rent	8,500
To Donation for building fund	27,000	By Books	20,000
To Admission fees (Revenue)	5,050	By Travelling expenses	2,000
		By Investments	40,000
		By Insurance	1,700
		By Balance c/d (Cash at bank)	11,260

	92,510		92,510

Additional information:

Particulars	1.04.2011	31.03.2012
Outstanding Subscription	3,000	5,000
Outstanding Subscription	3,000	5,000	Furniture	32,000	12,600
Building Fund	1,45,000
Capital Fund	1,51,960
Investment	2,50,000

Prepare Income and Expenditure A/c for the year ended 31st March, 2012 and Balance Sheet as on that date.

From the following Balance Sheet and Receipts and Payments A/c of Vidya Mandir High School, Alibag. Prepare Income and Expenditure Account for the year ended 31^stMarch 2008 and Balance Sheet as on that date

Balance Sheet as on 1st April 2007
Liabilities	Amount (Rs)	Assets	Amount (Rs)
Entrance Fees	6,000	Furniture	16,800
Capital Fund	1,03,800	Laboratory	20,000
		Library	25,000
		Investment	40,000
		Cash in hand	1,000
		Cash at bank	3,000
		Outstanding Tuition Fees	4,000
	1,09,800		1,09,800

Receipts and Payments Account for the year ended 31st March 2008
Receipts	Amount (Rs)	Payments	Amount (Rs)
To Balance b/d		By Furniture Purchased	5,400
Cash in hand	1,000	By Salaries	60,000
Cash at bank	3,000	By Rent	28,000
To Tuition Fees	80,000	By Sundry Expenses	15,200
To Term Fees	26,200	By Annual Gathering Expenses	11,300
To Government Grant	16,000	By Insurance	4,000
To Donation of Library	30,000	By Closing Balance
To Interest on Investment	2,000	Cash at bank	34,300
	1,58,200		1,58,200

Adjustments:
1. Tuition fees still receivable are Rs. 10,000.
2. Salaries still payable are Rs. 30,000
3. An insurance premium is paid for one year ending 30.9.2008.
4. Rent paid in advance Rs. 4,000.
5. Depreciate furniture and library at 10%.

Depreciation to be charged on the closing balances of the assets.

With the help of the Balance Sheet and Receipts and Payments Accounts of Adarsh Cultural Club, Mumbai, prepare Income and Expenditure Account for the year ended 31st March, 2013 and the Balance Sheet as on that date :

Balance Sheet as on 01.04.2012

Liabilities	Amount	Assets	Amount
Capital fund	2,57,000	Buildings	2,50,000
Building fund	50,000	Furniture	20,000
Outstanding salary	1,300	Outstanding Subscription	1,000
		Cash in hand	2,400
		Cash at bank	34,900
	3,08,300		3,08,300

Receipts and Payments Account for the year ending 31.03.2013

Receipts	Amount	Amount	Payments	Amount	Amount
To Balance b/d			By Salaries		35,300
Cash in hand		2,400	By Furniture (Purchased on01.10.2012)		10,000
Cash at bank		34,900	By General expenses		8,400
To Subscriptions			By Printing and stationery		4,200
2011–12	1,000		By Drama expenses		16,000
2012–13	48,000		By Balance c/d
2013–14	2,000	51,000	Cash in hand		4,600
To Donations for			Cash at bank		57,800
building fund		20,000
To Drama receipts		28,000
		1,36,300			1,36,300

You are also required to consider the additional information given below:
(1) The club had 100 members, each paying 500 as annual subscription.
(2) Furniture to be depreciated at 20 % p.a.
(3) Salaries include Rs .1,300 paid for outstanding salaries for the year 2011‐12.
Salaries outstanding for the year 2012‐13 were 700.

Expenditure on purchase of a building is a _____.

Following is the Receipts and Payments Account and additional information of Kalpana Hospital, Sakri.

Receipts and Payments Account for the year ended on 31st March, 2010
Dr.			Cr.
Receipts		Amount Rs.		Payments	Amount Rs.
To Balance b/d		6,000		By Medicines	10,000
To Subscriptions:				By Honorarium to Doctors	75,000
2008-2009	7,500			By Ambulance Maintenance	44,000
2009-2010	95,000			By Hospital Equip. purchased	30,000
2010-2011	15,000	1,17,500		By Furniture purchased	25,000
To Donations		55,000		By Fixed Deposits	1,00,000
To Life Membership Fees		25,000		By Balance c/d (31.3.10)	69,500
To Hospital Receipts (Revenue)		1,50,000
		3,53,500			3,53,500

Additional Information:

(1) Outstanding subscription for 2009-2010 is amounted to Rs. 5,000.

(2) Hospital equipments and furniture were purchased on 1.10.2009 and both were to be depreciated at 20% p. a.

(3) Life membership fees are to be capitalized.

(4) Donations represent donations for Building fund.

(5) Staff salary for the current year is outstanding Rs. 7,500.

(6) On 1.4.2009, the hospital had the following assets and liabilities:
Land Rs. 2,50,000, Investments Rs. 50,000, Ambulance Rs. 1,02,500, Bank Loan Rs. 2,00,000.

(7) Capital Fund as on 1.4.2009 was amounted to Rs. 2,16,000.
Prepare: Income and Expenditure Account for the year ending 31st March, 2010 and the Balance Sheet as on that date.

Income and Expenditure Account includes items of ____ nature only.

Match the following pairs :

Group ‘A’		Group ‘B’
(1)	Income and Expenditure A/c	(a)	Withdrawals in cash or kind
(2)	Drawings	(b)	Negotiable instrument
(3)	Bill of Exchange	(c)	Similar to Profit and Loss account
(4)	Co-venturers’ Liability	(d)	Limited
(5)	Intangible Asset	(e)	Computer
		(f)	Unlimited
		(g)	Goodwill
		(h)	Building

Following is the summary of Receipts and Payments of Jay Bajrangbali Vyayam Shala, Ajara for the year ending on 31.03.2007.

Receipts and Payments Account For the year ended on 31^st March 2007
Dr.				Cr.
Receipts	Amount Rs.	Payments	Amount Rs.
To Balance b/d To Subscription 2005-06 2006-07 To Donation for Building To Receipts from Entertainments To Interest To Entrance fees	41,600 4,120 1,60,000 50,000 36,440 3,240 45,000	By Salary By Lighting By General Expenses By Entertainments Expenses By Taxes Paid By Printing and Stationery By Expenses paid of 2005-06 By Investment By Fixed Deposit with Ajara Urban Bank By Balance c/d	55,000 10,000 15,360 25,800 5,000 9,440 24,000 1,20,000 40,000 35,800
Total	3,40,400	Total	3,40,400

1. Jay Bajrangbali Vyayam Shala has 4500 members paying annual subscription of Rs. 40 each.

2. Provide for outstanding salary Rs. 5,000.

3. On 1.4.2006 the assets stood as under:

(a)	Land and Building	Rs. 60,000
(b)	Furniture	Rs. 46,000

Depreciate the above assets at 10% p. a.

4. Interest on Investment Rs. 2,000 is not received.

5. Capital Fund was Rs. 1,27,720 on 1.4.2006.

6. 50% of the entrance fees is to be capitalized.

Prepare: Income and Expenditure Account for the year ended 31st March, 2007 and Balance Sheet as on that date.

Answer in one sentence only.
What do you mean by recurring expenses?

Answer in one sentence only.
What does ‘surplus’ mean?

Answer in one sentence only.
What is ‘Deficit’?

Write one Word / Term / Phrase for the following statement.
An Account, which is prepared by ‘Not for Profit’ concern, instead of Profit and Loss Account.

Write one Word / Term / Phrase for the following statement.
Excess of expenditure over income

Select the most appropriate answer from the alternatives given below and rewrite the sentence.
Excess of income over Expenditure is termed as _________________.

Select the most appropriate answer from the alternatives given below and rewrite the sentence.
‘Not for Profit’ Concerns prepare _________________ Account instead of Profit and loss Account.

Select the most appropriate answer from the alternatives given below and rewrite the sentence.
An Income and Expenditure Account and a Balance sheet is prepared as final accounts by a ______________ .

State whether the following statement is True or False.
Receipts and Payments Account do not have any opening balance.

From the following Trial Balance of M/s Vishal and Vaibhav, you are required to prepare Trading and Profit and Loss Account, for the year ended 31st March 2013 and Balance Sheet as on that date after taking into consideration the adjustments given below:

Trial Balance as on 31st March 2013
Debit Balances	Amount	Credit Balances	Amount
Salary and Wages	17000	Sales	110000
Postage and Telegram	1750	Sundry Creditors	72700
Opening Stock	23500	Bills Payable	40000
Plant and Machinery	70000	10% Bank Loan [Taken on 1st October 2012]	60000
Import Duty	3100	Outstanding Audit Fees	5900
Purchases	98500	Capital Accounts:
Sundry Debtors	45800	Vishal	45000
Bills Receivable	16700	Vaibhav	45000
Carriage Outward	1800
Wages and Salary	14000
Printing and Stationery	4600
Cash in hand	1850
Leasehold premises	80000
	378600		378600