Question

From the following Receipts and payments account of a club for 2017-18, prepare Income and Expenditure account and a balance sheet as on 31.3.2018.
Receipts and Payments account

Receipts	Amount (Rs.)	Payments	Amount (Rs.)
To Donations received	14,000	By Salaries	3,300
To Subscriptions	6,500	By Furniture	11,700
To Life Memberhip fee	6,000	By Games expenses	2,500
To Tournment fund	8,000	By Printing	3,100
To Entrance fee	1,200	By Tournment expenses	3,000
To Donations for Computer	5,000	By Sports Equipment	14,000
To Sale of Old Newspaper	500	By Balance c/d	2,600
	40,200		40,200

Adjustments:
1. Subscriptions received in advance Rs. 1500 and Outstanding Subscriptions Rs. $2500$.
2. Value of Sports equipment on 1.4.07 Rs. 1000 and on 31.3.2008 Rs. $9000$
3. Provide Rs. 1000 depreciation on Furniture.
Calculate the Amount of Surplus/Deficit from the Income and Expenditure account and mark the correct option from the following:

• A. Surplus Rs. $1,700$
• B. Deficit Rs. $1,700$
• C. Surplus Rs. $2,700$
• D. Deficit Rs. $2,700$

Answer 1

The correct option is B Deficit Rs. $1,700$

Expenditure	Amount (Rs.)	Incomes	Amount (Rs.)
To sports equipment	9,000	By donations received	14,000
To depreciation on furniture	1,000	By subscriptions	7,500
To salaries	3,300	By Entrance Fees	1,200
To games expenses	2,500	By sale of old newspaper	500
To printing	3,100	Deficit	1,700
To depreciation on sports equipment	6,000
	24,900		24,900

Depreciation on sports equipment = 1,000 + 14,000 - 9,000 = 6,000

Subscriptions = 6,500 + 2,500 (outstanding) - 1,500 (advance) = 7,500