question_answer

From the following extract of receipts and payments account and additional information given below, compute the amount of income from subscription and show how they would appear in income and expenditure account for the year ended 31st March, 2017 and in the balance sheet on that date: Receipts and Payments Account Dr                                             for the year ending 31st March, 2017                                                          Cr

Receipts	Amt (Rs.)	Payments	Amt (Rs.)
Subscriptions
2015-16	7,000
2016-17	30,000
2017-18	5,000

Additional Information

(i) Subscription outstanding on 31st March, 2016 Rs. 8,500

(ii) Total subscriptions outstanding on 31st March, 2017 Rs. 18,500

(iii) Subscriptions received in advance as on 31st March, 2016 Rs. 4,000

Answer:

Income and Expenditure Account Dr                                             for the year ending 31st March, 2017                                                         Cr

Expenditure	Amt (Rs.)	Income		Amt (Rs.)
		Subscriptions
		(+) Outstanding for Current Year	30,000
		(+) Advance for Current Year	17,000
		Received Previous Year	4,000	51,000

* Note  The amount of subscriptions outstanding as on 31st March, 2017 Rs. 18,500. This includes Rs. 7,500 (Rs. 8,500 - 7,000,) for subscriptions still outstanding for 2015-16. Hence, the subscriptions outstanding for 2016-17 are Rs. 17,000 (Rs. 78,500 ? Rs. 1,500). Balance Sheet as at 31st March, 2017

Liabilities	Amt (Rs.)	Assets		Amt (Rs.)
Subscription Received		Subscription Outstanding
in Advance	5,000	2015-16 (8,500 ? 7,000)	1,500
		2016 ? 17	17,000	18,500

Balance Sheet as at 31st March, 2016

Liabilities	Amt (Rs.)	Assets	Amt (Rs.)
Advance Subscription	4,000	Subscription	8,500