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Question
State with reason how the following item will be treated while preparing the 'Income and Expenditure Account' and 'Balance Sheet' of a Not-for-Profit Organisation:
Government Grant for the construction of a building.
Solution
The Government grant is for some specific purpose. Hence will be shown on the liabilities side of balance sheet only.
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RELATED QUESTIONS
What is subscription? How is it calculated?
Show the treatment of the following items by a Not-for-Profit Organisation:
(i) Annual subscription
(ii) Specific donation
(iii) Sale of fixed assets
(iv) Sale of old periodicals
(v) Sale of sports materials
(vi) Life membership fee
Show the treatment of items of Income and Expenditure Account when there is a specific fund for those items.
In the year ended 31st March, 2019, subscriptions received by Kings Club, Delhi were ₹ 4,09,000 including ₹ 5,000 for the year ended 31st March, 2018 and ₹ 10,000 for the year ended 31st March, 2020. At the end of the year ended 31st March, 2019, subscriptions outstanding for the year ended 31st March, 2019 were ₹ 15,000. The subscriptions due but not received at the end of the previous year, i.e., 31st March, 2018 were ₹ 8,000, while subscriptions received in advance on the same date were ₹ 18,000.
Calculate amount of subscriptions to be credited to Income and Expenditure Account for the year ended 31st March, 2019.
Calculate amount of subscriptions which will be treated as income for the year ended 31st March, 2019 for each of the following cases:
| Particulars | ₹ | |
| Case I. |
(i) Subscriptions collected during the year ended 31st March, 2019
(ii) Subscriptions in arrears for the year ended 31st March, 2019
(iii) Subscriptions received in advance for the year ended 31st March, 2020 |
2,50,000 6,000 5,000 |
| Case II. | (i) Subscriptions collected during the year ended 31st March, 2019 (ii) Subscriptions for the year ended 31st March, 2019 collected in the year ended 31st March, 2018 (iii) Subscriptions unpaid for the year ended 31st March, 2019 |
49,000 3,000 2,000 |
| Case III. | (i) Subscriptions received during the year ended 31st March, 2019 (ii) Subscriptions outstanding in the beginning of the year ended 31st March, 2019 (iii) Subscriptions not yet collected for the year ended 31st March, 2019 |
25,000 3,000 5,000 |
| Case IV. | (i) Subscriptions received during the year ended 31st March, 2019 (ii) Subscriptions outstanding in the beginning of the year ended 31st March, 2019 (iii) Subscriptions not yet collected for the year ended 31st March, 2019 (iv) Subscriptions received in advance for the year ended 31st March, 2020 |
80,000 5,000 8,000 2,000 |
| Case V. | (i) Subscriptions received during the year ended 31st March, 2019 (ii) Subscriptions outstanding at the end of the year ended 31st March, 2018 (iii) Subscriptions received in advance on 31st March, 2018 (iv) Subscriptions received in advance on 31st March, 2019 (v) Subscriptions not yet collected for the year ended 31st March, 2019 |
90,000 5,000 3,000 4,000 6,000 |
From the following information, calculate amount of subscriptions outstanding for the year ended 31st March, 2019:
A club has 200 members each paying an annual subscription of ₹ 1,000. The Receipts and Payments Account for the year showed a sum of ₹ 2,05,000 received as subscriptions. The following additional information is provided :
| ₹ | |
| Subscriptions Outstanding on 31st March, 2018 | 30,000 |
| Subscriptions Received in Advance on 31st March, 2019 | 40,000 |
| Subscriptions Received in Advance on 31st March, 2018 | 14,000 |
On the basis of information given below, calculate the amount of medicines to be debited to the Income and Expenditure Account of Good Health Hospital for the year ended 31st March, 2019:
| Particulars | 1st April, 2018 (₹) |
31st March, 2019 (₹) |
| Stock of Medicines | 1,75,750 | 1,44,650 |
| Creditors for Medicines | 15,06,900 | 18,20,700 |
Medicines purchased during the year ended 31st March, 2019 were ₹ 60,80,700.
Calculate amount of medicines consumed during the year ended 31st March, 2019:
| ₹ | |
| Opening Stock of Medicines | 1,00,000 |
| Opening Creditors for Medicines | 90,000 |
| Cash purchases of Medicines during the year | 3,00,000 |
| Closing Stock of Medicines | 1,50,000 |
| Closing Creditors for Medicines | 1,30,000 |
Calculate amount to be posted to the Income and Expenditure Account for the year ended 31st March, 2019:
| (i) | Amount paid for stationery during the year ended 31st March,2019 – ₹5,400; Stock of Stationery in Hand on 31st March, 2019 – ₹ 250 |
|
| (ii) | Stock of Stationery in Hand on 1st April, 2018 – ₹ 1,500; Payment made for Stationery during the year ended 31st March, 2019 – ₹ 5,400; Stock of Stationery in Hand on 31st March, 2019 – ₹ 250. |
|
| ₹ | ||
| (iii) | Stock of Stationery on 1st April, 2018 | 1500 |
| Creditors for Stationery on 1st April, 2018 | 1,000 | |
| Amount paid for Stationery during the year | 5,400 | |
| Stock of Stationery on 31st March, 2019 | 250 |
Calculate the amount that will be posted to the income and Expenditure Account for the year ended 31st March, 2019:
| ₹ | |
| Stock of Stationery on 1st April, 2018 | 30,000 |
| Creditors for Stationery on 1st April, 2018 | 20,000 |
| Advances paid for Stationery carried forward from the year ended 31st March, 2018 | 2,000 |
| Amount paid for Stationery during the year ended 31st March, 2019 | 108,000 |
| Stock of Stationery on 31st March, 2019 | 5,000 |
| Creditors for Stationery on 31st March, 2019 | 13,000 |
| Advance paid for Stationery on 31st March, 2018 | 3,000 |
Calculate the amount of sports material to be transferred to income and Expenditure Account of Raman Bhalla Sports Club, Ludhiana, for the year ended 31st March, 2018 :
| Particulars | (₹) | ||
| (i) | Sports material sold during the year (Book Value ₹ 50,000) | 56,000 | |
| (ii) | Amount paid to creditors for sports materials | 91,000 | |
| (iii) | Cash purchase of sports material | 40,000 | |
| (iv) | Sports material as on 31st March, 2017 | 50,000 | |
| (v) | Sports material as on 31st March, 2018 | 55,000 | |
| (vi) | Creditors for sports material as on 31st March, 2017 | 37,000 | |
| (vii) | Creditors for sports material as on 31st March, 2018 | 45,000 | |
Delhi Youth Club has furniture at a value of ₹ 2,20,000 in its book on 31st March, 2018. It sold old furniture, having book value of ₹ 20,000 as at 1st April , 2018 at a loss of 20% on 31st December, 2018. Furniture is to be depreciated @ 10% p.a. Furniture costing ₹ 1,50,000 was also purchased on 1st October, 2018.
Prepare Furniture Account for the year ended 31st March, 2019.
State with reason how the following item will be treated while preparing the 'Income and Expenditure Account' and 'Balance Sheet' of a Not-for-Profit Organisation:
Sale of used sports material
State with reason how the following item will be treated while preparing the 'Income and Expenditure Account' and 'Balance Sheet' of a Not-for-Profit Organisation:
Life membership fees
