Question

How will you show the followings in the Income and Expenditure Account? (i) Rent paid in the Current year ` 6,000 (ii) Rent due in Current year ` 800 (iii) Rent paid last year for this year ` 600 (iv) Rent due of last year paid in this year ` 2,000 (v) Advance rent paid for next year in this year `1,600


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Answer 1

Answer:

Correct option is

A

Rs. 6,500

Rent paid during the yr. + Rent outstanding but not yet paid - Rent paid in advance at the end of yr. =  Amount debited to income and expenditure account

Rs. 6,000 + Rs. 1,000 - Rs. 500 = Amount debited to income and expenditure account

Amount debited to income and expenditure account = Rs. 6,500.

Answer 2

ANSWER :

• ❖ If Rent paid in the Current year is Rs. 6,000; Rent due in Current year is Rs. 800; Rent paid last year for this year is Rs. 600; Rent due of last year paid in this year is Rs. 2,000 and Advance rent paid for next year in this year is Rs. 1,600; then the actual amount to be shown in the Income and Expenditure Account on account of rent will be Rs. 3,800.

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EXPLANATION :

❒ Given :-

• Rent paid in the Current year = Rs. 6,000

• Rent due in Current year = Rs. 800

• Rent paid last year for this year = Rs. 600

• Rent due of last year paid in this year = Rs. 2,000

• Advance rent paid for next year in this year = Rs. 1,600

❒ To Calculate :-

• Amount to be shown in the Income and Expenditure Account = ?

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❒ Calculation :-

It is given that,

• ✠ Amount of rent paid during the current year = Rs. 6,000

⊚ Add : Amount of rent due at the end of the current year = Rs. 800

• ✠ Amount of rent obtained = Rs. 6,800

⊚ Add : Amount of rent paid last year for current year = Rs. 600

• ✠ Amount of rent obtained = Rs. 7,400

⊚ Less : Amount of rent due od last year paid in current year = Rs. 2,000

• ✠ Amount of rent obtained = Rs. 5,400

⊚ Less : Amount of rent paid in advance for next year in current year = Rs. 1,600

• ★ Amount of rent to be shown in Income and Expenditure Account = Rs. 3,800

Hence,

• ✎ An amount of Rs. 3,800 is to be shown in Income and Expenditure Account on account of rent.