Question

From the following extracts of the Receipts and Payments Account and the additional information, you are required to compute the income from subscription for the year ending on December 31, 2012 and show the subscription items in the income and Expenditure Account and the Balance Sheet as on 31-12-2012

AN EXTRACT OF RECEIPTS AND PAYMENTS ACCOUNT

for the year ending on 31st December, 2012

$\begin{array}{cccc}\text{Receipts}& \text{Amount}& \text{Payments}& \text{Amount}\\ & \left(\text{Rs}\right)& & \left(\text{Rs}\right)\\ \text{To Subscriptions :}& & & \\ 2011& 9,000& & \\ 2012& 1,34,400& & \\ 2013& 5,200& & \end{array}$

Information : Subscription outstanding as on 31-12-2011 Rs 9,200. Subscription received in advance as on 31-12-2011 Rs 2,800 (including Rs 800 for 2012). There are 1,440 members each playing an annual subscription of Rs 100.

Answer 1

AN EXTRACT OF INCOME AND EXPENDITURE ACCOUNT

for the year ending on 31st December, 2012

$\begin{array}{cccc}\text{Expenditure}& \text{Amount}& \text{Income}& \text{Amount}\\ & \left(\text{Rs}\right)& & \left(\text{Rs}\right)\\ & & \text{By Subscription Income}& 1,44,000\end{array}$

AN EXTRACT OF BALANCE SHEET

as at 31st December, 2012

$\begin{array}{cccc}\text{Liabilities}& \text{Amount}& \text{Assets}& \text{Amount}\\ & \left(\text{Rs}\right)& & \left(\text{Rs}\right)\\ \text{Subscription received in advance}& 7,200& \text{Subscription outstanding}& \\ & & \text{For 2011}(Rs9,200-Rs9,000)200& \\ & & \text{For 2012}(Rs9,000-Rs200)8,800& 9,000\end{array}$

Working Notes:

Calculation of subsription outstanding for 2012

$Dr.\text{SUBSCRIPTION ACCOUNT}Cr.\begin{array}{cccc}\text{Particulars}& \text{Amount}& \text{Particulars}& \text{amount}\\ & \left(Rs\right)& & \left(Rs\right)\\ \text{To Outstanding Subscription A/c}& 9,200& \text{By Advance Subscription A/c}& 2,800\\ \left(Beg\right)& & \left(Beg\right)& \\ \text{To Income and Expenditure A/c}& 1,44,000& \text{By Bank A/c}& 1,48,600\\ \text{To Advance Subscription A/c}& 7,200& \text{By Outstanding Subscription A/c}& 9,000\\ & \overline{1,60,400}& \text{(Balancing Figure)}& \overline{1,60,400}\end{array}$