question_answer

Following is the receipts and payments account of Star Club for the year ending 31st March, 2018. Receipts and Payments Account Dr                                             for the year ending 31st March, 2018                                                         Cr

Receipts	Amt (Rs.)	Payments	Amt (Rs.)
To Balance b/d	984	By Salaries	4,992
To Subscriptions	7,280	By Stationary	456
(including Rs. 160 for 2016-17 and Rs. 240 for 2018-19)		By Meeting Expenses	720
To Interest on Investments	3,240	By Books	1,600
To Sale of Machinery	480	By Balance c/d	2,616
(Book value Rs. 400)
	11,984		11,984

Additional Information

(i) On 1st April, 2017 the club had investments Rs. 64,000, machinery Rs. 4,800, Books Rs. 8,000.

(ii) Salary outstanding 31st March, 2017 Rs. 416 and 31st March, 2018 Rs. 528

Prepare income and expenditure account for the year ending 31st March, 2018 and a balance sheet as on that date.

Answer:

                                                Income and Expenditure Account Dr                                             for the year ending 31st March, 2018                                                         Cr

Expenditure		Amt (Rs.)	Income		Amt (Rs.)
To Salaries	4,992		By Subscription	7,280
(+) Outstanding for Current year	(528)		(-) Subscription Outstanding for Previous Year	(160)
	5,520			7,120
(-) Outstanding for Previous Year	(416)	5,104	(-) Advance Subscription for Next year	(240)	6,880
To Stationery		456	By Interest on Investment		3,240
To Meeting Expenses		720	By Profit on Sale of Machinery		80
To Surplus i.e. Excess of
Income over Expenditure		3,920
		10,200			10,200

Balance Sheet as at 31st March, 2018

Liabilities		Amt (Rs.)	Assets		Amt (Rs.)
Advance Subscription		240	Cash		2,616
Outstanding Salary		528	Books	8,000
Capital Fund	77,528		(+) Purchase	1,600	9,600
(+) Surplus	3,920	81,448	Investments	64,000
			(+) Purchase	1,600	65,600
			Machinery	4,800
			(-) Sold	(400)	4,400
		82,216			82,216

Balance Sheet as at 31st March, 2017

Liabilities	Amt (Rs.)	Assets	Amt (Rs.)
Outstanding Salary	416	Cash	984
Capital Fund (Balancing figure)	77,528	Outstanding Subscription	160
		Investments	64,000
		Machinery	4,800
		Books	8,000
	77,944		77,944