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Question
From the following particulars, prepare Income and Expenditure account:
| Details | Amount (RS) |
| Fees collected, including Rs 80,000 on account of the previous year | 520000 |
| Fees for the year outstanding | 30000 |
| Salary paid, including Rs 5,000 on account of the previous year | 68000 |
| Salary outstanding at the end of the year | 3000 |
| Entertainment expenses | 8000 |
| Tournament expenses | 25000 |
| Meeting Expenses | 18000 |
| Traveling Expenses | 7000 |
| Purchase of Books and Periodicals, including Rs 31,000 for purchase of Books | 40000 |
| Rent | 15000 |
| Postage, telegrams and telephones | 6000 |
| Printing and Stationery | 18000 |
| Donations received | 25000 |
Solution
Income and Expenditure Account
Dr. Cr.
| Expenditure | Amount (Rs) | Income | Amount (Rs) | ||
| Salaries | 68000 | 66000 | Fees Collected | 520000 | 470000 |
| Less : Previous year's Outstanding | (5000) | Less : Previous year's outsranding |
(80000) | ||
| 63000 | 440000 | ||||
| Add: Current year's outstanding | 3000 | Add : Current year outstanding | 30000 | ||
| Entertainment Expenses | 8000 | Donations | 25000 | ||
| Tournament Expenses | 25000 | ||||
| Meeting Expenses | 18000 | ||||
| Traveling Expenses | 7000 | ||||
| Purchases of Periodicals (40,000 – 31,000) | 9000 | ||||
| Postage, Telegrams and Telephone’s | 6000 | ||||
| Rent | 15000 | ||||
| Printing and Stationery | 18000 | ||||
| Surplus (Excess of Income over Expenditure) | 323000 | ||||
| 495000 | 495000 | ||||
NOTE: As per the solution, Excess of Income over Expenditure is Rs 3,23,000; however, as per the book, it is Rs 3,07,000.
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RELATED QUESTIONS
What steps are taken to prepare Income and Expenditure Account from a Receipt and Payment Account?
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 | Rs |
| 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 |
From the following Receipts and Payment Account and additional information, prepare Income and Expenditure Account and Balance Sheet of Sears Club, Noida as on March 31, 2018.
Receipts and Payment Account of Sears Club for the year ended 31-3-2018
| Receipts |
Amount (₹) |
Payments | Amount (₹) |
| To Balance b/d | 20,000 | By Stationery | 23,400 |
| To Subscriptions | By 12% Investments | 8,000 | |
| 2016-17 - 40,000 | By Electricity expenses | 10,600 | |
| 2017-18 - 94,000 | By Expenses on lectures | 30,000 | |
| 2018-19 - 7,200 | 141,200 | By Sports equipment | 59,000 |
| To Donations for building | 40,000 | By Books | 40,000 |
| To Interest on Investments | 800 | By Balance c/d | 50,000 |
| To Government Grant | 17,400 | ||
| To Sale of old furniture | |||
| (Book value ₹ 4,000) | 1,600 | ||
| 2,21,000 | 2,21,000 |
Additional Information:
(i) The club has 200 members each paying an annual subscription of ₹ 1,000. ₹ 60,000 were in arrears for last year and 25 members paid in advance in the last year for the current year.
(ii) Stock of stationery on 1-4-2017 was ₹ 3,000 and on 31-3-2018 was ₹ 4,000.
