Following is the Receipt and Payment account of Rohatgi Trust : Receipt and Payment Account for the year ending December 31, 2017 Receipts Amount Rs Payments Amount Rs Cash in hand 14,000 Rent 6,000 Cash at Bank 60,000 Salary 12,000 Subscriptions: 2016 2017 2018 5,000 83,000 3,000 91,000 Postage Electricity charges Purchase of furniture Books 300 6,000 20,000 3,000 Sale of Investment 90,000 Defence Bonds 1,50,000 Interest on investment 2,000 Help to needy students 22,000 Sale of furniture (book value Rs 3,000) 3,200 Cash in hand Cash at bank 10,900 30,000 2,60,200 2,60,200 Prepare Income and expenditure account for the year ended December 31, 2017, and a balance sheet as on that date after the following adjustments: Subscription for 2017, still owing were Rs 7,000. Interest due on defence bonds was Rs7,000, Rent still owing was Rs 1,000. The Book value of investment sold was Rs 80,000, Rs 30,000 of the investment were still in hand. Subscription received in 2017 included Rs 400 from a life member. The total furniture on January 1, 2017 was worth Rs 12,000. Salary paid for the year 2018 is Rs 2,000.
Answers
Given : Rohatgi Trust : Receipt and Payment Account for the year ending December 31, 2017 Receipts Amount Rs Payments Amount Rs Cash in hand 14,000 Rent 6,000 Cash at Bank 60,000 Salary 12,000 Subscriptions: 2016 2017 2018 5,000 83,000 3,000 91,000 Postage Electricity charges…….
Concept :
Income and expenditure account :
- It is like a profit and loss account.
- It is a Nominal account.
- It has income (credit) and expenditure (debit) side.
- It has no opening balance.
- Its balance is either Surplus or Deficiency.
- It records items of revenue nature only.
- Adjustments such as depreciation, outstanding expenses , prepaid expenses , accrued income , etc.are made in it.
Receipt and payment account :
- A Receipt and payments account is a summary of cash book transactions relating to a particular accounting period, usually 1 year.
- All receipts, whether in a cash or cheques, are shown on the debit side and all payments , whether made in cash or by cheque, are shown on the credit side of Receipts and Payments account .
- It includes all receipts and payments whether they are of revenue or capital nature.
Income and expenditure account for the year ended December 31, 2017, and a balance sheet are in the attachment below :
Hope this answer will help you..
Some more questions of this chapter :
From the following receipts and payments and information given below, Prepare Income and Expenditure Account and opening Balance Sheet of Adult Literacy Organisation as on December 31, 2017. Receipt and Payment Account for the year ending as on December 31, 2017 Receipts Amount Rs Payments Amount Rs Balance b/d General Expenses 3,200 Cash in hand 4,000……..
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Leela and Meeta were partners in a firm sharing profits and losses in the ratio of 5:3. On Is Jan. 2017 they admitted Om as a new partner. On the date of Om’s admission the balance sheet of Leela and Meeta showed a balance of Rs 16,000 in general reserve and Rs 24,000 (Cr) in Profit and Loss Account. Record necessary journal entries for the treatment of these items on Om’s admission. The new profit sharing ratio between Leela, Meeta and Om was 5:3:2.
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