Page 21 - DEBKVOL-1

Chapter 1 Financial Statements of Not-for-Profit Organisations 1.11
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Solution: Excellent Recreation Club
INCOME AND EXPENDITURE ACCOUNT
Dr. for the year ended 31st March, 2018 Cr.
Expenditure ` Income `
To Salaries (WN 2) 24,500 By Subscriptions: 45,500
To Rent (WN 3) 7,400 Less: Subscriptions:
To Postage 300 For 2016–17 1,000
To Printing and Stationery 2,550 For 2018–19 1,500 2,500 43,000
To Electricity Charges 3,000 By Interest on Investments 20,000
To Meeting Expenses 1,500 By Bank Interest 250
To Excess of Income over Expenditure By Gain (Profit) on Sale of Furniture 500
(Surplus) transferred to Capital Fund 24,500 (` 3,000 – ` 2,500)
63,750 63,750

BALANCE SHEET as at 31st March, 2018
Liabilities ` Assets `
Subscriptions Received in Advance 1,500 Furniture 30,000
Outstanding Liabilities for: Less: Sale during the year 2,500 27,500
Salaries 2,500 Library Books 50,000
Rent 800 3,300 Addition during the year 10,000 60,000
Capital Fund as at 1st April, 2017 4,84,550 Investments 4,00,000
Add: Surplus for the year 24,500 5,09,050 Addition during the year 10,000 4,10,000
Cash at Bank 14,800
Cash in Hand 1,550
5,13,850 5,13,850

Working Notes:
1. BALANCE SHEET as at 1st April, 2017
Liabilities ` Assets `
Outstanding Liabilities for: Furniture 30,000
Salaries 2,000 Library Books 50,000
Rent 600 2,600 Investments 4,00,000
Capital Fund 4,84,550 Cash at Bank 5,650
(Balancing Figure) Cash in Hand 500
Subscriptions in Arrears 1,000
4,87,150 4,87,150

2. `
Salaries paid during the year 24,000
Less: Salaries outstanding (1st April, 2017) 2,000
22,000
Add: Salaries outstanding (31st March, 2018) 2,500
Salaries to be debited to Income and Expenditure Account 24,500
3. Rent paid during the year 7,200
Less: Rent outstanding (1st April, 2017) 600
6,600
Add: Rent outstanding (31st March, 2018) 800
Rent to be debited to Income and Expenditure Account 7,400