Amaravathi Town Club provided Receipts and Payments A/c for the year ended 31-March-2013. Prepare Income and Expenditure A/c.

| Receipts | Amount (₹) | Payments | Amount (₹) |
| --- | --- | --- | --- |
| To Balance b/d (01-04-2012) | 5,750 | By Salaries | 4,000 |
| To Subscripti

Question

Amaravathi Town Club provided Receipts and Payments A/c for the year ended 31-March-2013. Prepare Income and Expenditure A/c.

| Receipts | Amount (₹) | Payments | Amount (₹) |
| --- | --- | --- | --- |
| To Balance b/d (01-04-2012) | 5,750 | By Salaries | 4,000 |
| To Subscriptions | 3,250 | By Rent | 750 |
| To Interest | 250 | By Stationery | 250 |
| To Sale of old furniture | 400 | By Government Bonds | 3,000 |
| To Entrance Fees | 2,000 | By Balance c/d (31-03-2013) | 3,650 |
| | 11,650 | | 11,650 |

Adjustments :

(1) Subscriptions include ₹ 250 received for last year.
(2) Rent includes ₹ 150 paid for last year.
(3) Book value of furniture sold ₹ 500.
(4) The Entrance fees is to be capitalized.

Accepted Answer

>

> [!TLDR]
> Convert the Receipts & Payments figures to the current year's revenue items — subscriptions Rs. 3,000, rent Rs. 600, loss on furniture Rs. 100; exclude entrance fees (capitalised), government bonds (capital) and the sale proceeds — giving a **deficit of Rs. 1,700**.
>
> **Working of adjustments**
> - Subscriptions: 3,250 - 250 (received for last year) = **Rs. 3,000** income of this year
> - Rent: 750 - 150 (paid for last year) = **Rs. 600** expense of this year
> - Furniture sold: book value Rs. 500, sold for Rs. 400, so **loss on sale = Rs. 100** (an expenditure); the Rs. 400 receipt itself is capital and is not an income
> - Entrance fees Rs. 2,000 are capitalised, so they are NOT shown as income
> - Government Bonds Rs. 3,000 is a capital payment (an investment), not an expense
> - Interest Rs. 250 is a revenue income
>
> **Income and Expenditure Account for the year ended 31 March 2013**
>
> | Expenditure | Amount (Rs.) | Income | Amount (Rs.) |
> | --- | --- | --- | --- | …

Adjustment	Treatment
Subscriptions received	+ outstanding for this year, − received in advance, − last year's arrears now received
Expenses paid	+ outstanding, − prepaid
Depreciation on assets	Debit (non-cash expense)
Bad debts / provisions	Debit

Receipts	Amount	Payments	Amount
Cash in hand	150	Ground man's Fee	1,125
Balance at Bank as per Pass Book :		Moving Machine	2,250
– Deposit Account	3,345	Ground Rent	375
– Current Account	900	Cost of Teas	375
Bank Interest	45	Fares	600
Donations and Subscriptions	3,900	Printing & Office Expenses	420
Receipts from teas	450	Repairs to Equipment	750
Contribution to fares	150	Honorarium to Secretary and Treasurer of 2024	600
Sale of Equipment	120	Balance at Bank as per Pass Book:
Net proceeds of Variety Entertainment	1,170	– Deposit Account	4,635
Donation for forthcoming Tournament	1,500	– Current Account	225
		Cash in hand	375
Total	11,730	Total	11,730

Particulars	April 1, 2024	March 31, 2025
Subscription due	225	150
Amount due for printing, etc.	150	120
Cheques unpresented being payment for repairs	450	390
Estimated value of machinery and equipment	1,200	2,625
Interest not yet entered in the Pass book		30
Bonus to Ground man outstanding		450

Liabilities	Amount ₹	Assets	Amount ₹
Trade Creditors	19,275	Land and Building	37,500
Outstanding Liabilities	2,250	Furniture	9,750
General Reserve	9,750	Closing Stock	17,625
Capital :		Sundry Debtors	8,250
A 18,000		Cash and Bank balance	1,650
B 18,000
C 7,500	43,500
Total	74,775	Total	74,775

Particulars	₹
Opening estimated value	1,200
Add: Mowing machine purchased	2,250
Less: Sale proceeds of equipment	(120)
Less: Closing estimated value	(2,625)
Depreciation (balancing figure)	705

Concept understanding — Income and Expenditure Account

How it differs from Receipts & Payments

Preparing it (the adjustments)

Part (a) — Income & Expenditure A/c and Balance Sheet (12 Marks)

Step 1 — Working notes (accrual adjustments)

Step 2 — Opening Balance Sheet (1 April 2024) → the Capital Fund

Step 3 — Income & Expenditure Account for the year ended 31 March 2025

Receipts	Amount (₹)	Payments	Amount (₹)
To Balance b/d (01-04-2012)	5,750	By Salaries	4,000
To Subscriptions	3,250	By Rent	750
To Interest	250	By Stationery	250
To Sale of old furniture	400	By Government Bonds	3,000
To Entrance Fees	2,000	By Balance c/d (31-03-2013)	3,650
	11,650		11,650

Liabilities	₹	Assets	₹
Creditors for printing	150	Cash in hand	150
Honorarium outstanding (2024)	600	Bank — Deposit A/c	3,345
Capital Fund (bal. fig.)	4,620	Bank — Current A/c (900 − 450)	450
		Subscription due	225
		Machinery & equipment	1,200
Total	5,370	Total	5,370

Expenditure	₹	Income	₹
To Ground man's fee (1,125 + 450)	1,575	By Subscriptions & Donations (W1)	3,825
To Ground rent	375	By Bank interest (W3)	75
To Cost of teas	375	By Receipts from teas	450
To Fares	600	By Contribution to fares	150
To Printing & office exp. (W2)	390	By Net proceeds of variety entertainment	1,170
To Repairs to equipment (W7)	690
To Honorarium (W4)	900
To Depreciation (W6)	705
To Surplus (excess of income over exp.)	60

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