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Income and Expenditure Account

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Question

PRACTICAL PROBLEMS

(Accounts of a Charitable Hospital)

Following information has been provided by “Janseva Charitable Hospital”, Latur. You are required to prepare Income and Expenditure Account for the year ending on 31/03/2013 and Balance Sheet as on that date.

Balance Sheet as on 01/04/2012

Liabilities

Amount

Rs

Assets

Amount

Rs

Capital Fund

10,37,000

Building

10,00,000

Bank Loan

6,00,000

Ambulance

3,50,000

Outstanding bill for Drugs

45,000

Stock of Drugs

35,000

Hospital Equipments

2,95,000

Cash in Hand

2,000

16,82,000

16,82,000

Receipts and Payments Account for the year ending 31.03.2013

Dr.

Cr.

Receipts

Amount

Rs

Payments

Amount

Rs

To Balance b/d

2,000

By Purchases of Drugs

1,90,000

To subscription

2,10,000

By Salary of staff

85,000

To Life Membership Fees

27,500

By Honararium to Doctors

3,85,000

To Hospital Receipts

5,20,900

By Repairs and Maintenance

17,900

(Revenue)

By Furniture

40,000

By General Expenses

12,600

By Balance c/d

29,900

7,60,400

7,60,400

Adjustments:

1) On 31/03/2013 stock of Drugs was valued Rs 20,000.

2) Depreciate Building @ 5% p.a. and Ambulance by Rs 20,000

3) Life Membership Fees are to be capitalized.

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Solution

Janseva Charitable Hospital, Latur

Income and Expenditure Account

for the year ending March 31, 2013

Dr.

Cr.

Expenditure

Amount

(Rs)

Income

Amount (Rs)

Drugs Consumed during the year

Subscription

2,10,000

Stock as on Apr.01,2012

35,000

Hospital Receipts

5,20,900

Add: Purchases

1,90,000

Deficit (Excess of Expenditure over Income)

44,600

Less: Stock as on Mar.31,2013

20,000

2,05,000

Repairs and Maintenance

17,900

Honorarium to Doctors

3,85,000

General Expenses

12,600

Depreciation:

Building

50,000

Ambulance

20,000

70,000

Salaries to Staff

85,000

7,75,500

7,75,500

Balance Sheet

as on March 31, 2013

Liabilities

Amount

(Rs)

Assets

Amount (Rs)

Capital Fund

Furniture

40,000

Opening Balance

10,37,000

Building

10,00,000

Add: Life Membership Fees

27,500

Less: Depreciation

50,000

9,50,000

Less: Deficit

44,600

10,19,900

Ambulance

3,50,000

Bank Loan

6,00,000

Less: Depreciation

20,000

3,30,000

Outstanding Bill for Drugs

45,000

Hospital Equipment

2,95,000

Stock of Drugs

20,000

Cash in Hand

29,900

16,64,900

16,64,900

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PRACTICAL PROBLEMS

(Outstanding Expenses and Prepaid Expenses)

From the following information supplied to you, prepare Income and Expenditure Account for the year ending on 31/03/2013 and Balance Sheet as on that date for Suryodaya Club, Nasik.

Balance Sheet as on 01/04/2012
Liabilities	Amount Rs	Assets	Amount Rs
Capital Fund	50,000	Land	60,000
Bank Overdraft	35,000	Outstanding Subscriptions	5,000
Outstanding Salary	2,000	Prepaid Insurance Premium	2,500
		Cash in Hand	9,500
		Furniture	10,000
	87,000		87,000

Receipts and Payments Account for the year ending 31.03.2013
Dr.					Cr.
Receipts	Amount Rs	Payments		Amount Rs
To Balance b/d	9,500	By Bank Overdraft (Repaid)		35,000
To Subscription	95,000	By Salary		12,500
To Admission Fees	7,500	By Insurance Premium		8,000
		By Interest		1,700
		By Miscellaneous Expenses		4,400
		By Furniture		20,000
		By Balance c/d
		Cash in Hand	5,400
		Cash at Bank	25,000	30,400
	1,12,000			1,12,000

Adjustments:

1) Subscriptions received, includes Rs 3,000 for 2011-2012 and Outstanding Subscriptions for 2012-2013 was Rs 8,000.

2) Salary Paid includes Rs 2,000 Paid for last year

3) On 31/03/2013, Prepaid Insurance Premium was Rs 3,000

4) Admissions Fees are to be capitalized.

5) Depreciate Furniture by Rs 2,000

PRACTICAL PROBLEMS

From the following Receipts and Payments Account of Nanasaheb Patil Engineering College, Faizpur for the year ending 31 March 2013 and additional information, Prepare Income and Expenditure Account for year ending 31/03/2013 and a Balance Sheet as on that date.

Receipts and Payments Account for the year ending 31.03.2013
Dr.	Cr.
Receipts		Amount Rs	Payments	Amount Rs
To Balance b/d			By Salaries to
Cash in Hand		15,950	• Teaching Staff	8,50,500
Cash at Bank		1,00,070	• Office Staff	1,81,000
To Interest		51,000	By Electricity	51,900
To Subscriptions		25,800	By Books	57,800
To Life Membership Fees		20,500	By Furniture	45,000
To Donations		6,36,000	By Stationery	19,950
To tuition Fees		11,20,000	By Fixed Deposit	7,50,000
To Term Fees		2,00,900	31/03/2013
To Admission Fees		55,000	By Balance c/d
To Sundry Receipts		6,930	Cash in Hand	13,500
			Cash at Bank	2,62,500
		22,32,150		22,32,150

Additional Information:

Particulars	01/04/2012	31/03/2013
Books	5,50,000	5,50,000
Furniture	2,15,000	2,00,000
Building Fund	9,35,000	?
Fixed Deposits	8,00,000	?
Capital Fund	7,46,020	?

2) 50% of Donations are for Building Fund and the balance is to be treated as revenue income.

3) Outstanding Subscription Rs 4,200.

4) Life Membership Fees are to be capitalized.

PRACTICAL PROBLEMS

Following is the accounting information for the year 2009-2010 of Cricket Club, Pune, You are required to prepare Income and Expenditure Account as on 31.03.2010 and Balance Sheet as on that date.

Balance Sheet as on 01.04.2009
Liabilities	Amount Rs	Assets		Amount Rs
Capital Fund	67,100	Land		1,20,000
Building Fund	54,000	Sports Material		32,000
Bank Overdraft	37,400	Cash in Hand		2,200
		Outstanding Subscriptions
		2007-2008	Rs 1,800
		2008-2009	Rs 2,500	4,300
	1,58,500			1,58,500

Receipts and Payments Account for year ending on 31-03-2010
Dr.	Cr.
Receipts		Amount Rs	Amount Rs	Payments	Amount Rs	Amount Rs
To Balance b/d			2,200	Bank Overdraft (repaid)		37,400
(cash in Hand)				By Salaries		25,600
To subscription				By Electricity Charges		2,250
2007-2008		1,800		By Rent and Taxes		1,750
2008-2009		2,500		By Printing and Stationery		5,100
2009-2010		65,500	69,800	By Entertainment Expenses		8,700
To Donations			11,000	31/03/2010
To Entertainment Receipts			8,800	By Balance c/d
To Entrance Fees			2,000	Cash in Hand		3,000
				Cash at Bank		10,000
			93,800			93,800

Adjustments:

1) Donation are received for Building Fund.

2) Entrance Fees are to be Capitalized.

3) Outstanding Subscription Rs 1,500.

4) Depreciate sport Material @ 12 1/2% p.a.

PRACTICAL PROBLEMS

(Accounting of a School)

From the information given below of Jeevan Vikas Vidyalaya Khamgaon, You are required to prepare, Income and Expenditure Account and Balance Sheet for the year ending on 31.03.2011.

Balance Sheet as at 01.04.2010
Liabilities	Amount Rs	Assets	Amount Rs
Capital Fund	4,99,100	Library Books	1,15,500
Loan	5,00,000	Laboratory Equipments	1,25,000
		Furniture	1,10,000
		Building	6,25,000
		Cash in Hand	3,500
		Cash at Bank	20,100
	9,99,100		9,99,100

Receipts and Payments Account for the year ending 31.03.2011
Dr.	Cr.
Receipts		Amount Rs	Payments		Amount Rs
To Balance b/d			By Salaries		6,25,200
Cash in Hand		3,500	By Purchases
Cash at Bank		20,100	i. Laboratory Equipments	10,000
To Tuition Fees		3,67,500	ii. Library Books	50,000
To Term Fees		35,000	iii. Furniture	20,000	80,000
To Admission Fees		30,600	By Sundry Expenses		10,000
To Government Grant (Revenue)		3,50,000	By Printing and Stationery		35,800
To Sundry Receipts		1,300	By Annual Social
			Gathering Expenses		18,000
			By Balance c/d
			Cash in Hand		4,000
			Cash at Bank		35,000
		8,08,000			8,08,000

Adjustments:

1) Tuition Fees Outstanding Rs 13,500

2) Outstanding Interest on Loan Rs 60,000

3) Entire admission Fees are to be Capitalized.

4) Depreciation is to be written off as under:

Library Books Rs 50,000	Furniture Rs 30,000
Laboratory Equipment Rs 20,000	Building Rs 30,000

PRACTICAL PROBLEMS

(Simple Problem)
With the information given below, prepare Income and Expenditure Account and Balance sheet of Sudarshan charitable Organisation for the year ending on 31-03-2012.

Receipts and Payment Account for the year ending on 31-03-2012
Dr.						Cr.
Receipts	Amount Rs	Amount Rs	Payments	Amount Rs	Amount Rs
To Balance b/d			By Salaries		18,000
Cash in Hand	500		By Printing and stationery		20,000
Cash at Bank	39,500	40,000	By Charity Expenses		20,000
To Subscriptions		81,000	By Investments		60,000
(includes Rs 5,500 for 2009-10)			By Office expenses		2,000
Interest on Investments		1,800	By Balance c/d
To Sale of Furniture		8,000	Cash in Hand	700
(Book Value Rs 10,000)			Cash at Bank	10,100	10,800
		1,30,800			1,30,800

Additional Information:

1) There are Rs 800 members, paying annual subscription Rs 100 each.

2) Outstanding salary Rs 2,000.

3) The Assets on 01-04-2012 were as following:

Furniture Rs 40,000, Investment Rs 20,000, Land Rs 1,00,000

4) On 01-04-2012 Capital Fund was Rs 2,05,500

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Janseva Charitable Hospital, Latur Income and Expenditure Account for the year ending March 31, 2013
Dr.				Cr.
Expenditure		Amount (Rs)	Income	Amount (Rs)
Drugs Consumed during the year			Subscription	2,10,000
Stock as on Apr.01,2012	35,000		Hospital Receipts	5,20,900
Add: Purchases	1,90,000		Deficit (Excess of Expenditure over Income)	44,600
Less: Stock as on Mar.31,2013	20,000	2,05,000
Repairs and Maintenance		17,900
Honorarium to Doctors		3,85,000
General Expenses		12,600
Depreciation:
Building	50,000
Ambulance	20,000	70,000
Salaries to Staff		85,000
		7,75,500		7,75,500

Balance Sheet as on March 31, 2013
Liabilities		Amount (Rs)	Assets		Amount (Rs)
Capital Fund			Furniture		40,000
Opening Balance	10,37,000		Building	10,00,000
Add: Life Membership Fees	27,500		Less: Depreciation	50,000	9,50,000
Less: Deficit	44,600	10,19,900	Ambulance	3,50,000
Bank Loan		6,00,000	Less: Depreciation	20,000	3,30,000
Outstanding Bill for Drugs		45,000	Hospital Equipment		2,95,000
			Stock of Drugs		20,000
			Cash in Hand		29,900
		16,64,900			16,64,900