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Model Test Papers M.293

13.
INCOME AND EXPENDITURE ACCOUNT
Dr. for the year ended 31st March, 2018 Cr.
Expenditure ` Income `
To Salaries 80,000 By Subscription (WN 1) 1,48,800
To Stationery 18,000 By Proceeds from Games 25,900
To Telephone Expenses 8,000 Less: Games Prizes and Expenses 22,000 3,900
To Van Expenses 12,000 By Donations 12,500
To Loss on Sale of Van (WN 2) 12,500
To Depreciation on:
Computer (` 16,000 – ` 14,000) 2,000
Van (25% of ` 63,000) 15,750
Sports Equipments (` 62,000 – ` 54,000) 8,000
To Surplus, i.e., excess of Income
over Expenditure 8,950
1,65,200 1,65,200
Calculation of Capital Fund on 1st April, 2017:

BALANCE SHEET as at 1st April, 2017
Liabilities ` Assets `
Capital Fund (Balancing Figure) 1,66,820 Van (WN 3) 22,500
Computer 16,000
Sports Equipments 62,000
Cash in Hand 20,000
Cash at Bank 31,920
Subscription in Arrears 14,400
1,66,820 1,66,820

Working Notes: `
1. Subscription received during the year (for 2017–18) 1,40,800
Add: Outstanding Subscription for 2017–18 (` 16,200 – ` 8,200) 8,000
Amount to be credited to Income and Expenditure Account 1,48,800

2. Calculation of Loss on Sale of Van: `
Book Value of Van sold on 1st April, 2017 (WN 3) 22,500
Less: Sale Proceeds 10,000
Loss on sale of Van 12,500

3. Calculation of Book Value of Van sold on 1st April, 2017: `
Original cost on 1st April, 2015 40,000
Less: Depreciation (on 31st March, 2016) 10,000
Book Value on 1st April, 2016 30,000
Less: Depreciation (on 31st March, 2017) 7,500
Book Value of van sold on 1st April, 2017 22,500