Question

Prepare Income and Expenditure Account from the following particulars of Youth Club for the year ended on 31st March, 2018:

RECEIPTS AND PAYMENTS ACCOUNT for the year ended 31st March, 2018
Dr.					Cr.
Receipts		₹	Payments	₹
To Balance b/d (Cash)		32,500	By Salaries	31,500
To Subscription:			By Postage	1,250
2016-17	1,500		By Rent	9,000
2017-18	60,000		By Printing and Stationery	14,000
2018-19	1,800	63,300	By Sports Material	11,500
To Donations (Billiards Table)		90,000	Bu Miscellaneous Expenses	3,100
To Entrance Fees		1,100	By Furniture (1st October, 2017)	20,000
To Sale of Old Magazines		450	By 10% Investment (1st October, 2017)	70,000
			By Balance c/d (31st March, 2018)	27,000
		1,87,350		1,87,350

Additional Information:
(i) Subscription outstanding as at 31st March, 2018 ₹ 16,200.
(ii) ₹ 1,200 is still in arrears for the year 2016-17 for subscription.
(iii) Value of sports material at the beginning and at the end of the year was ₹ 3,000 and ₹ 4,500 respectively.
(iv) Depreciation to be provided @ 10% p.a. on furniture.

Answer 1

In the books of Youth Club
Dr.	Income and Expenditure A/c for the year ended 31st March, 2018					Cr.
Expenditure		Amount (₹)	Income		Amount (₹)
To Salaries		31,500	By Subscriptions	60,000
To Postage		1,250	Add: Outstanding Subscriptions	15,000	75,000
To Rent		9,000	(16,200 – 1,200)
To Printing and Stationery		14,000	By Entrance fees		1,100
To Sports Material Consumed (WN1)		10,000	By Sale of Old Magazines		450
To Miscellaneous Expenses		3,100	By Interest Accrued on Investments		3,500
To Depreciation on Furniture (20,000 × 10/100 × 6/12)		1,000	(70,000 × 10/100 × 6/12)
To Surplus- Excess of Income over Expenditure		10,200
		80,050			80,050

Note: If nothing is mentioned, Entrance fee is to be treated as a revenue receipt. Working Notes: 1)

Sports Material Consumed	=	Opening Stock + Purchases – Closing Stock
	=	₹ (3,000 + 11,500 – 4,500) = ₹ 10,000