How will the following items appear in the Final accounts of a Club for the year ending 31st March 2018 ?
Receipts and payments Account for the year ended 31st March 2018.
| Dr. Receipts | ₹ | ₹ | Cr. Payments | ₹ |
|---|---|---|---|---|
| To subscription | ||||
| 2016-2017 | 10,000 | |||
| 2017-2018 | 50,000 | |||
| 2018-2019 | 5,000 | 65,000 |
There are 200 members in the Club each paying an annual subscription of ₹ 400 per annum. Subscription still outstanding for the year 2016-2017 is ₹ 2,000.
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Start your 14-day free trial to unlock the full solution →Current-year subscription income = 200 × ₹400 = ₹80,000; show outstanding ₹32,000 (asset) and advance ₹5,000 (liability) in the Balance Sheet.
Concept (TN HSC Class-12 Accountancy — NPO): Subscription is credited to the Income and Expenditure Account for the current accounting year only, on accrual basis. Amounts relating to earlier/later years are adjusted through the Balance Sheet.
Step 1 — Subscription income for 2017-18: 200 members × ₹400 = ₹80,000 (credited to Income and Expenditure Account).
Step 2 — Amount received for 2017-18 = ₹50,000. Outstanding for 2017-18 = 80,000 − 50,000 = ₹30,000.
Step 3 — Other items: Subscription of ₹5,000 received for 2018-19 is an advance (liability). Subscription of ₹2,000 for 2016-17 is still outstanding (asset). (The ₹10,000 of 2016-17 received this year is not income of 2017-18.)
Income and Expenditure Account for the year ended 31st March 2018 (extract)
| Expenditure | ₹ | Income | ₹ |
|---|---|---|---|
| By Subscription (200 × 400) | 80,000 | ||
| … |
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