Q. 7. Show how will you deal with the following items while preparing the final
accounts of a N.P.O. for the year ending 31st March, 2020 :
Building Fund as on 1.4.2019
Donation received for Building during the year
Expenditure on Construction of Building during the year
Capital Fund as on 1.4.2019
Life membership fee received
The construction work is in progress and has not yet completed.
8,00,000
12,00,000
7,00,000
10,00,000
50,000
Answers
Explanation:
Building fund 13,00,000
Capital fund 17,50,000
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Answer:
The building fund for the year ended 31st March, 2020 is 13,00,000.
The Capital Account for the year ended 31st March, 2020 is 17,50,000.
Explanation:
Fund Based Accounting
Concept :
- Fund based accounting refers to an accounting system in which Receipts relating to a particular fund are credited to the associated fund.
- Payments and expenses related to that fund are debited to related fund . (Prize Fund, Sports Fund, Building Fund Tournament Fund, etc.)
- Such funds are created for specific purposes.
Given;
Building Fund as on 1.4.2019 8,00,000
Donation received for Building during the year 12,00,000
Expenditure on Construction of Building 7,00,000
Capital Fund as on 1.4.2019 10,00,000
Life membership fee received 50,000
The construction work is in progress and has not yet completed.
The Following will appear in the Liabilities Side of the Balance Sheet;
Building Fund 8,00,000
Add: Donation received for Building 12,00,000
Less : Expenditure on construction (7,00,000)
Building Fund 13,00,000
Capital Fund 10,00,000
Add: Life membership Fees 50,000
Add : Expenditure on construction 7,00,000
Capital Account 17,50,000
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