Select the Most Appropriate Answer from the Alternatives Given Below and Rewrite the Sentence. - Book Keeping and Accountancy

Question

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

Options

deficit
profit
surplus
loss

MCQ

Solution

Excess of income over expenditure is termed as surplus.

Explanation: When income side of the Income and Expenditure Account exceeds its expenditure side, then we have surplus.

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Preparation of Income and Expenditure Account and Closing Balance Sheet

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Micheal Vaz Book Keeping and Accountancy [English] 12 Standard HSC Maharashtra State Board

Chapter 7 Accounts of 'Not For Profit' Concerns
Exercise 3 | Q 4 | Page 228

RELATED QUESTIONS

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.

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.

What is ‘balance sheet’?

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 _____.

Answer in one sentence only.
What is Capital Fund?

Answer in one sentence only.
Which receipts are called capital receipts?

Answer in one sentence only.
What is deferred revenue expenditure?

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

Answer in one sentence only.
What is legacy?

Answer in one sentence only.
Which receipts are called ‘Revenue Receipts?

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

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.
‘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.
In the Income and Expenditure Account, all incomes received during the year irrespective of the year for which they are received, are to be recorded.

State whether the following statement is True or False.
The final balancing amount of Income and Expenditure Account represents either surplus or Deficit.

Following is the Balance Sheet and Receipts and Payments Account of Ekveera Hospital Amravati.

Balance Sheet as on 1.4.2012

LIABILITIES	AMOUNT	ASSETS	AMOUNT
Capital Fund	502000	Cash in Hand	3000
Medical bill Unpaid	3000	Cash at Bank	6000
		Land and Building	400000
		Furniture	35000
		Equipments	60000
		Outstanding Subscription	1000
	505000		505000

Receipts and Payments Account for the year ended 31.3.2013

Receipts	Amount	Payments	Amount
To balance b/d		By Salaries	55000
Cash in Hand	3000	By Medicines	26000
Cash at Bank	6000	By Equipment purchased	10000
To Subscription [Includes Rs. 1000 received for previous year]	65000	By General Expenses	4300
To Sale of Old Furniture [Book value Rs. 15000]	10000	By Balance c/d
To Donations (Revenue)	22000	Cash in Hand	7700
To Life Membership Fees	12500	Cash at Bank	15500

	118500		118500

Adjustments:

(1) Outstanding subscription Rs. 6000.

(2) Capitalise the amount of life membership fees.

(3) Outstanding Salary Rs. 6000.

(4) Depreciate Land and Building by Rs. 10000 and Equipments by Rs. 15000.

(5) Unpaid medicine bill as on 1-4-2012 is still unpaid.

Prepare Income and Expenditure Account for the year ending 31.3.2013 and Balance Sheet as on that date.

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

Adjustments:

(1) Closing stock was valued at Rs. 30000.

(2) Postal stamps of Rs. 250 and stationery of Rs. 400 are unused.

(3) Leasehold property is to be run for 10 years w.e.f. 1st October 2012.

(4) Depreciate Plant and Machinery at 10% p.a.

(5) Mr. Rajan, our customer, became insolvent and could not pay his debts of Rs. 1500.

Following is the balance sheet as on 1.4.2012 and receipts and payments accounts of mahakavi kalidas Library , Nashik . Balance sheet as on 31st March 2013.

Balnce sheet as on 01.04.2012

Liabilities	Amount (₹)	Assets	Amount (₹)
Capital fund	690000	Furniture	72500
Expenses due	7000	Books	551000
		Investment in securities	50000
		Cash in hand	8500
		Cash in Bank	15000
	697000		697000

Receipts and Payments for the year ending 31st March ,2013

Dr. Cr.

Receipts	Amount (₹)	Payments	Amount (₹)
To Balance b/d		By electricity charges	6980
Cash in hand	8500	By postage and telegram	6100
Cash in bank	15000	By Purchase of books	80000
To member's subscriptions	180000	By Payment of expenses due	7000
To Entrance fees	25000	By Sundry expenses	10500
To Sales of old newspapers	1500	By Investment in securities	100000
To Hire of lecture hall	18000	By Furniture	28000
To Interest on securities	4000	By Balance c/d
		Cash in hand	6420
		Cash in bank	7000
	252000		252000

Adjustments:

(1) During the current year , furniture was purchased on 1.10.2012. Depreciation furniture @ 10 % p.a.

(2) Depreciate books by ₹ 100000

(3) Membership subscription received during the year includes ₹ 15000 , for the year 2013 - 14 and ₹ 7500 , are outstanding for current year.

(4) Capitalised half (1/2) of the entrance fees.

Prepare : Income and Expenditure account for the year ended 31st March 2013 and Balance sheet as on 31st march , 2013.

Select the Most Appropriate Answer from the Alternatives Given Below and Rewrite the Sentence. - Book Keeping and Accountancy

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Select the Most Appropriate Answer from the Alternatives Given Below and Rewrite the Sentence. - Book Keeping and Accountancy

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