Question

Help me out with this I have an exam tomorrow ​

Answer 1

Answer:

Rs.20000 Donation will be treated on the debit/income side of Income and Expenditure Account under the head of General Donation. The rest of the donation will be shown in Balance Sheet - Liabilities Side under the head of Donation for Building.

If the question has interest on investments then it will be calculated for for 9 months as -

Amount of investment × (Rate of Interest ÷ 100) × (Months left after the purchase ÷ 12)

Interest on Investments will be shown on debit/income side of Income and Expenditure Account

Explanation:

You don't have to prepare Balance Sheet as it isn't asked in the question.