TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations

Read TS Grewal Accountancy Class 12 Solution Chapter 1 Financial Statement of Not for Profit Organisations 2023 2024. Students should study TS Grewal Solutions Class 12 Accountancy available on Studiestoday.com with solved questions and answers. These chapter-wise answers for Class 12 Accountancy have been prepared by expert teachers of Grade 12. These TS Grewal Class 12 Solutions have been designed as per the latest accountancy TS Grewal Book for Class 12 and if practiced thoroughly can help you to score good marks in standard 12 Accounts class tests and examinations.

Class 12 Accounts Chapter 1 Financial Statement of Not for Profit Organisations TS Grewal Solutions

TS Grewal Solutions for Chapter 1 Financial Statement of Not for Profit Organisations Class 12 Accounts have been provided below based on the latest TS Grewal Class 12 book. The answers have been prepared based on the latest 2023 2024 book for the current academic year. TS Grewal Solutions Class 12 will help students to improve their concepts and easily solve accountancy questions for Class 12. Class 12 Grewal solutions should be revised regularly as more practice will help you get a better rank and easily solve more questions.

Chapter 1 Financial Statement of Not for Profit Organisations TS Grewal Class 12 Solutions

About this chapter: TS Grewal Class 12 Chapter 1 provides a detailed understanding of the concepts relating to the financial statements of not-for-profit organizations. Chapter 1 in Class 12 TS Grewal accountancy book mainly covers the different accounting topics relating to types of financial statements of not-for-profit organizations, such as income and expenditure account, balance sheet, and cash flow statements. The author has also explained in great detail the importance of each financial statement and how it helps the interested party in assessing the performance of not-for-profit organizations. The chapter also covers one of the most important topics which is the accounting treatment of different items such as donations received, legacies, and endowments. There are a lot of detailed concepts and questions given in the chapter, and our teachers have provided solutions to all unsolved questions in the book. With the help of TS Grewal Solution Class 12 Chapter 1, Class 12 students will be able to understand the concepts and principles of financial accounting and gain a detailed understanding of the financial statements of not-for-profit organizations.

Solutions for T.S. Grewal's Double Entry Book Keeping
Accounting for Not for Profit Organizations and Partnership Firms (Vol.1)
Textbook for CBSE Class 12
TS Grewal Solutions Class 12 Accountancy
Chapter 1 Financial Statement of Not-for-Profit Organisations
 
 
Very Short Answer Type Questions:
 
Q1. Not-for-Profit Organisations have some distinguishing features from that of profit making organisations. State anyone them.
Answer:
Not-for-Profit Organisations are formed with a view to serve its members and public at large while profit organisations serve the objective of earning profits.
 
Q2. What is the nature of Receipts and Payments Account?
Answer:
Receipts and Payments Account is a summary of cash (including bank) receipts and payments during an accounting period, receipts and payments being shown under appropriate heads of accounts.
 
Q3. Is it correct to state that Receipts and Payments Account does not show non-cash transaction? Why?
Answer:
Receipts and Payments Accounts is Prepared on cash basis, i.e. transactions and events which have been related to cash are shown in the account. This is the summary of the cash transaction as in the cash book.
 
Q4. State the basis of accounting on which Receipts and Payments Account is prepared in case of Not-for-Profit Organisation.
Answer:
Cash Basis of Accounting on which Receipts and Payments Account is prepared in case of Not-for-Profit Organisation.
 
Q5. What is the nature of Income and Expenditure Account?
Answer:
Income and Expenditure Account is like profit and loss Account of an enterprise. Since, Not for Profit Organisation are not established for the purpose or earning profit, they do not prepare Profit and loss Account.
 
Q6. Distinguish between Income and Expenditure Account and Receipts and Payments Account on the basis of nature of items recorded therein.
Answer:
Income and Expenditure Account records items of revenue nature whereas Receipts and Payments Account records items of both capital and revenue nature.
 
Q7. Distinguish between Income and Expenditure Account and Receipts and Payments Account on the basis of its nature.
Answer:
Income and Expenditure Account is a Nominal Account whereas Receipts and Payments Account is a Real Account.
 
Q8. Where is general donation received shown in the final accounts of a Not-for-Profit Organisation?
Answer:
Debit side of Receipts and Payment account, General donation received shown in the final accounts of a Not-for-Profit Organisation.
 
Q9. Where is specific donation received shown to the final accounts of a Not-for-Profit Organisation?
Answer:
The Specific donation received shown in Receipts and Payments Account of a Not-for-Profit Organisation.
 
Q10. Is Entrance/Admission fee a revenue receipt?
Answer:
Yes, Entrance/Admission fee a revenue receipt.
 
Q11. Name the term used for showing excess of income over expenditure of Not-for-Profit Organisations.
Answer:
Surplus, i.e. Excess of income over expenditure.
 
Q12. Name the term used when there is excess of expenditure over income in case of a Not-for-Profit Organisation.
Answer:
Deficit, i.e. excess of expenditure over income.
 
Q13. What is Capital Fund?
Answer: 
It is the excess of assets over liabilities of a Not-for-Profit Organisation.
 
Q14. Is Subscription received in advance an income or a liability?
Answer:
Subscription received in advance is a liability.
 
Q15. Subscription received in advance during the current year is recorded on which side of Balance Sheet?
Answer:
Subscription received in advance for the following year are shown on the liabilities side of the Balance Sheet.
 
Q16. What will be the treatment of 'Subscription received in Advance during the current year in the Balance Sheet of Not-for-Profit Organisation?
Answer:
Subscription relating to the current year whether received or not, are shown on the credit side of the Income and Expenditure Account. Subscription not received, i.e. outstanding are shown on the assets side of the Balance sheet. Subscription received in advance for the following year are shown on the liabilities side of the Balance Sheet.
 
 
Short Answer Type Questions:
 

Q1. Give three essential features of the Income and Expenditure Account.

Answer:

Features of Income and Expenditure Account:-

1.)   Nature: It is a Nominal Account. Hence, it is debited with expenses and losses and it is credited with income and gains. 

2.)   Opening and Closing Balance: It does not have an opening Balance. Its Balance at the end is either surplus or deficit. It is transferred to Capital Fund in the Balance Sheet. 

3.)   Adjustment: This account is prepared on accrual basis of accounting and thus all adjustments relating to prepaid or outstanding expenses and income, provision for depreciation or doubtful debts are made.

 

Q2. Explain with illustration the concept of Fund Based Accounting.

Answer:

Fund means amount received or set aside by a Not-for-Profit Organisation for a Specific purpose. The fund amount along with the income earned on the fund cannot be used for purposes other than those for which it is received or set aside.

Donations received or funds set aside for specific purposes are credited to a separate Fund Account and are shown on the liabilities side of the Balance Sheet. The incomes from or donations for these funds are credited to respective Fund Account. On the other hand, expenses or Payments out of these funds are debited. Accounting when done on this basis is known as Fund Based Accounting.

For example: The Sports Fund has a balance of Rs. 1,00,000 which is invested as fixed deposit in a bank earning 8% interest. Further donation of Rs. 10,000 is received towards it. Expenses incurred towards prizes are Rs. 7,000; Rs. 3,000 towards trophies and Rs. 4,000 towards distribution of cash prizes. In the accounts, it is shown as follows:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021

 

Q3. What are the essential features of the Receipts and Payments Account?

Answer:

Features of Receipts and Payments Account:

1.) Nature: It is an asset account since it is a summary of cash receipts and cash payments including bank balance. 

2.) Basis of Preparing: It is prepared on cash basis i.e., transactions and events which have been received or paid in cash are shown in the account. 

3.) Capital and Revenue: It records all receipts and payments whether they are of revenue nature or capital nature.

4.) Period: It records cash and bank transactions without distinguishing among current, previous or succeeding (next) accounting periods. 

5.) Opening and Closing Balance: Opening balance of this account shows cash in hand and/or at bank in the beginning of the accounting period and closing balance shows cash in hand and/or at bank at the end of the accounting period. 

 

Q4. Differentiate between the Receipts and Payments Account and the Cash Account.

Answer:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-

 

EXERCISE :->

 

Question 1:  From the information given below, prepare Receipts and Payments Account of Railway Club for the year ended 31st march, 2019:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-1 

Answer: 1:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-2 

Point of Knowledge:- 

  • Receipts and Payments Account is a summary of cash (including bank) receipts and Payments during and accounting period, receipts and payments being shown under appropriate heads of accounts. 

 

Question 2:  Bengal Cricket Club was inaugurated on 1st April, 2018. It had the following Receipts and Payments during the year ended 31st March, 2019:

Receipts: Entrance Fees Rs. 10,000; Subscriptions Rs. 60,000; Donations Rs. 10,000.
Payments: Rent Rs. 15,000; Postages Rs. 1,000; Newspapers and Magazines Rs. 8,000; Investments Rs. 30,000; Stationery Rs. 4,000; Entertainment Expenses Rs. 3,000; Miscellaneous Expenses Rs. 2,000.
Show the Receipts and Payments Account for the year ended 31st March, 2019.
 

 

Answer: 2:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-3 

Point of Knowledge:-  

Final accounts of a Not-for-Profit Organisation include: 

1.)   Receipts and Payments Account 

2.)   Income and Expenditure Account 

3.)   Balance Sheet 

 

Question 3:  The following information were obtained from the books of Delhi Club as on 31st March, 2019 at the end of the first year of the Club, prepare Receipts and Payment Account for the year ending 31st March, 2019:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-4 

Answer: 3:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-5 

Point of Knowledge:- 

Limitations of Receipts and Payments Account:- 

1.)   It does not show expenses and income on accrual basis. 

2.)   It does not show whether the Not-for- Profit Organisation is able to meet its day-to-day expenses out of its income or not. 

 

Question 4:  From the following information, prepare Receipts and Payments Account of Long-town Sports Club for the year ending 31st March, 2019:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-6

Answer: 4:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-7 

Point of Knowledge :- Cash at Bank = Receipts – Payments

= 3,32,000 – 2,61,600

= 70,400

 

Question 5:  From the following particulars of Evergreen club, prepare Receipts and payments Account for the year ended 31st March, 2019: 

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-8

Answer: 5:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-9 

 

Fund Based Accounting

 

Question 6:  How are the following items shown in the accounts of a Not-for-Profit Organisation? 

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-10

Answer: 6:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-11

 

Question 7:  How are the following dealt with in the accounts of a Not-for-Profit Organisation?

 TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-12

Answer: 7:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-13

Note 1: Assumed a separate Prize fund is not maintained. 

 

Question 8: How are the following dealt with while preparing the final accounts of a club?

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-14

Answer: 8:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-16

 

Question 9:  From the following information of a club show the amounts of match expenses and match fund in the appropriate Financial Statements of the club for the year ended on 31st March, 2019: 

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-17

Answer: 9:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-18

 

Question 10:  Show how are the following items dealt with while preparing the final accounts for the year ended 31st March, 2019 of a Not-for-profit Organisation:

Case I    Expenditure on construction of Pavilion is Amount 6,00,000. The construction work is in progress and has not yet completed. Capital Fund as at 31st March, 2017 is Amount 20,00,000.

Case II    Expenditure on construction of Pavilion is Amount 6,00,000. The construction work is in progress and has not yet completed. Pavilion Fund as at 31st March, 2017 is Amount 10,00,000, and Capital Fund as at 31st March, 2017 is Amount 20,00,000.

Case III   Expenditure on construction of Pavilion is Amount 6,00,000. The construction work is in progress and has not yet completed. Pavilion Fund as at 31st March, 2017 is Amount 10,00,000, and Capital Fund as at 31st March, 2017 is Amount 20,00,000. Donation Received for Pavilion on 1st January,2018 is Amount 5,00,000. 

Answer 10:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-19

 

Entrance Fees

 

Question 11:  How is Entrance Fees dealt with while preparing the final accounts for the year ended 31st March, 2019 in each of the following alternative cases?


Case I:    During the year ended 31st March, 2019, Entrance Fees received was Amount 1,00,000.

Case II:    During the year ended 31st March, 2019, Entrance Fees received was Amount 1,00,000.Out of this, Amount 25,000 was received from individuals whose membership is not yet approved.

Answer 11:

Case 1:  During the year 2018-19, Entrance fees received Rs 1,00,000 – Entrance fees received Rs 1,00,000 should be credited to the Income and Expenditure Account

 

Case 2:  During the year 2018-19, Entrance Fees received Rs1,00,000. Out of this Rs25,000 pertains to the year 2018-19. The accounting policy of the club is to treat the Entrance fees as of revenue receipt. Entrance Fees received Rs75,000 should be credited to the Income and Expenditure Account and advance received Rs 25,000 for the year 2018-19 will be shown as advance entrance fees in the liabilities side of this year’s Balance Sheet.

 

Calculation of Amount of Subscriptions

 

Question 12: In the year ended 31st March, 2019, the subscriptions received by the Jaipur Literary Society were Amount 4,20,000. These subscriptions include Amount 14,000 received for the year ended 31st March, 2018. On 31st March, 2019, subscriptions due but not received were Amount 10,000. What amount should be credited to Income and Expenditure Account for the year ended 31st March, 2019 as subscription?   

Answer 12:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-20

 

Question 13: Subscriptions received during the year ended 31st March, 2018 are:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-21

There are 450 members, each paying an annual subscription of Amount 200; Amount 1,800 were in arrears for the year ended 31st March, 2018. 

Calculate amount of subscriptions to be credited to Income and Expenditure Account for the year ended 31st March, 2019.                                                                 

Answer 13:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-22

Points of Knowledge:

Subscriptions to be credited to the Income and Expenditure Account for the year ended 31st March

= Rs. 450 × 200

= Rs. 90,000

 

Question 14:  In the year ended 31st March, 2019, subscriptions received by Kings Club, Delhi were Amount 4,09,000 including Amount 5,000 for the year ended 31st March, 2018 and Amount 10,000 for the year ended 31st March, 2020. At the end Amount 15,000. The subscriptions due but not received at the end of the previous year, i.e., 31st March, 2017 were Amount 8,000, while subscriptions received in advance on the same date were Amount 18,000.

Calculate amount of subscriptions to be credited to Income and Expenditure Account for the year ended 31st March, 2018. 

Answer 14:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-23

 

Question 15 :From the following information, calculate amount of subscriptions to be credited to the Income and Expenditure Account for the year ended 31st March, 2019:

                                                                                                 Amount 
1st April, 2018             Subscriptions in Arrears                        50,000
                                     Subscriptions Received in Advance     30,000
31st March, 2019         Subscriptions in Arrears                       25,000
                                     Subscriptions Received in Advance     70,000

Subscriptions received during the year ended 31st March, 2019 -  Amount  Rs. 3,00,000 

Subscriptions still in arrears for the year 2017-18 Rs. 10,000  

Answer 15:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-24
 
 

Question 16:  Calculate amount of subscriptions which will be treated as income for the year ended 31st March, 2018 for each of the following cases:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-25

Answer 16:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-26

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-27

 

Question 17:  From the following particulars, calculate amount of subscriptions to be credited to the Income and Expenditure Account for the year ended 31st March, 2019:

 TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-28

Answer 17:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-29

 

Question 18:  How are the following items of subscriptions shown in the Income and Expenditure  Account for the year ended 31st March, 2019  and Balance Sheets as at 31st March, 2018 and 2019? 

                                                                                                                                Amount
Subscriptions received during the year ended 31st March, 2019                                 3,58,500
Subscriptions outstanding on 31st March, 2018                                                              30,000
Subscriptions received in Advance on 31st March, 2018                                                 22,500
Subscriptions received in Advance on 31st March, 2019                                                 13,500
Subscriptions outstanding on 31st March, 2019                                                               37,500
(including Amount 12,500 for the year ended 31st March, 2018) 

Answer 18:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-32

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-31

 

Question 19:  From the following information, calculate amount of subscriptions outstanding for the year ended 31st March, 2019:

A club has 200 members each paying an annual subscription of   Amount 1,000. The Receipts and Payments Account for the year showed a sum of   Amount 2,05,000 received as subscriptions. The following additional information is provided:

                                                                                                              Amount

Subscriptions Outstanding on 31st March, 2018                                   30,000
Subscriptions Received in Advance on 31st March, 2019                     40,000
Subscriptions Received in Advance on 31st March, 2018                     14,000

Answer 19:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-33

 

Question 20:  From the following information, prepare Subscription Account for the year ending 31st March, 2019:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-34

In the year ending 31st March, 2019, subscription received were Rs. 2,10,000 (including Rs. 6,000 of arrears from previous year) and subscription arrears of previous year were written off Rs. 4,000.

Answer 20:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-35

 

Calculation of the Amount of Consumable items

 

Question 21:  On the basis of information given below, calculate the amount of medicines to be debited to the Income and Expenditure Account of Good Health Hospital for the year ended 31st March, 2018: 

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-36

Medicines purchased during the year ended 31st March, 2018 were Amount 60,80,700

Answer 21:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-37

 

Question 22:  Calculate amount of medicines consumed during the year ended 31st March, 2018:

 TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-38

Answer 22:

Calculation of medicine consumed during the year ended 31st March ;

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-39

 

Question 23:   Calculate amount to be posted to the Income and Expenditure Account for the year ended 31st March, 2019:

(i) Amount paid for stationery during the year ended 31st March, 2019 ——Rs. 5,400; Stock of Stationery in Hand on 31st March, 2019 ——Rs. 250.

(ii) Stock of Stationery in Hand on 1st April, 2018——Rs. 1,500; Payment made for Stationery during the year ended 31st March, 2019——Rs. 5,400; Stock of Stationery in Hand on 31st March, 2019 ——Rs. 250.

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-40

Answer 23:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-41

 

Question 24:  On the basis of the following information, calculate amount that will appear against the term ' Stationery Used' in the Income and Expenditure Account for the year ended 31st March, 2018:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-42

Answer 24:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-43

 

Question 25:  Calculate the amount that will be posted to the income and Expenditure Account for the year ended 31st March, 2019:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-45

Answer 25:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-44

 

Question 26:  Calculate the amount of sports material to be transferred to income and Expenditure Account of Raman Bhalla Sports Club, Ludhiana, for the year ended 31st March, 2018 :

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A49

Answer 26:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A50

 
 

Question 27:  How are the following dealt with while preparing the final accounts for the year ended 31st March, 2018? 

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-46

Additional information: 

(I) Sports Materials in Hand on 31st March, 2018——Amount 22,000   

Answer 27:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-47

 

Question 28:  How are the following dealt with while preparing the final accounts for the year ended 31st March, 2018? 

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-48

Answer 28:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-49

 

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-50

 

Question 29:  How are the following dealt with while preparing the final accounts of a sports club for the year ended 31st March, 2019?

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A

Answer 29:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A1
 

Question 30:  From the following information of a Not-for-Profit Organisation, show the 'Sports Materials' item in the Income and Expenditure Account for the year ended 31st March, 2018 and Balance Sheets as at 31st March, 2019:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A2
 

Answer 30:

 

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A3

 

 

 

 

Calculation of Gain (Profit) or Loss on Sale of Fixed Assets

 

Question 31:  The book value of furniture on 1st April, 2018 is Amount 60,000. Half of this furniture is sold for Amount 20,000 on 30th September,2017. Depreciation is to be charged on furniture @ 10% p.a.

Calculate loss on sale of furniture. Show how the loss on sale and depreciation on furniture will be shown in the Income and Expenditure Account for the year ended 31st March, 2019.  

Answer 31:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A4 

Points of Knowledge: 

Loss on Sale of furniture to be shown in the Income and Expenditure Account is Rs 8,500. 

Depreciation on sale of furniture to be shown in the Income and Expenditure Account is 

1,500 + 3,000 = 4,500 

 

Question 32:  Delhi Youth Club has furniture at a value of Amount 2,20,000 in its book on 31st March, 2018. It sold old furniture, having book value of Amount 20,000 as at 1st April, 2018 at a loss of 20% on 31st December, 2018. Furniture is to be depreciated @ 10% p.a. Furniture costing Amount 1,50,000 was also purchased on 1st October, 2018 

Prepare Furniture Account for the year ended 31st March, 2019. 

Answer 32:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A5

 

Question 33:  In the year ended 31st March, 2018, salaries paid amounted to Amount 2,04,000. Ascertain the amount chargeable to the Income and Expenditure Account for the year ended 31st March ,2019 from the following additional information:

 TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A6

Answer 33:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A7

 

Question 34:  How are the following items dealt with while preparing Income and Expenditure Account of a club for the year ended 31st March, 2018?  Locker Rent received during the year ended 31st March, 2018—— Amount 52,000.

 TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A8

Locker Rent received during the year ended 31st March, 2018—— Amount 52,000.

Answer 34:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A9
 
 

Preparation of Income and Expenditure Account

 

 

Question 35:  Prepare Income and Expenditure Account for the year ended 31st March, 2019 from the following: 

 TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A10

Answer 35:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A11
 
 
Question 36:  Prepare Income and Expenditure Account from the following Receipts and Payments Account of Delhi Nursing Society for the year ended 31st March, 2019:
 
TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A12

Donation of Rs. 10,000 received for Building Fund was wrongly included in the Subscriptions Account. A bill of medicines purchased during the year amounted to Rs. 12,800 was outstanding. Government Grant is not for a specific purpose.

Answer 36:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A13 

 

Question 37:  Following is the Receipts and Payments Account of You Bee Forty Club for the year ended 31st March, 2018: 

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A14

Additional Information:
(a) Outstanding Subscriptions for the year ended 31st March, 2018——Rs. 55,000.
(b) Outstanding Salaries and Wages——Rs. 40,000.
(c) Depreciate Sports Equipment’s by 25%.
Prepare Income and Expenditure Account of the club from the above particulars. 

Answer 37:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A15

 

Question 38:  From the following Receipts and Payments Account of Jaipur Sports Club, prepare Income and Expenditure Account for the year ended 31st March, 2019:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A16

Answer 38:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A17

 

Question 39:  Following is the information given in respect of certain items of a Sports club. Show these items in the Income and Expenditure Account and the Balance Sheet of the club as at 31st March, 2018:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A18

Answer 39:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A19
 
 

Question 40:  Prepare Income and Expenditure Account from the following particulars of Youth Club for the year ended on 31st March, 2018:

 TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A20

Additional Information: 

(i)      Subscription outstanding as at 31st March, 2018 Rs. 16,200. 

(ii)     Rs. 1,200 is still in arrears for the year 2016-17 for subscription. 

(iii)    Value of sports material at the beginning and at the year was Rs. 3,000 and Rs. 4,500 respectively. 

(iv)    Depreciation to be provided @ 10% p.a. on Furniture.

Answer 40:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A21

 

Question 41:  Following is the Receipts and Payments Account of Delhi Football Club for the year ended 31st March, 2019:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A22

Additional Information:
(i) During the year ended 31st March, 2019, the club had 550 members and each paying an annual subscription of Rs. 100.
(ii) Salaries Outstanding as at 1st April, 2018 were Rs. 10,000 and as at 31st March, 2019 were Rs. 5,000.
Prepare Income and Expenditure Account of the Club for the year ended 31st March, 2019. 

Answer 41:

 

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A23

 

 

Preparation of the Income and Expenditure Account and Balance Sheet from Receipts and Payments Account with Additional Information 

 

Question 42:  Following is the summary of cash transactions of the Royal Club for the year ended 31st March, 2019:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A24

In the beginning of the year, the club possessed Books of Rs. 2,00,000 and Furniture of Rs. 85,000. Subscriptions in arrears in the beginning of the year amounted to Rs. 3,500 and at the end of the year Rs. 4,500 and six month’s Rent Rs. 6,000 was due both in the beginning of the year and at the end of the year.

Prepare Income and Expenditure Account of the club for the year ended 31st March, 2019 and is Balance Sheet as at that date after writing off Amount 5,000 and Amount 11,300 on Furniture and books respectively.

Answer 42:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A25

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A26

 

Question 43:  From the following Receipts and Payments Account of City Club and from the information supplied, prepare Income and Expenditure Account for the year ended 31st March, 2019 and Balance Sheet as at that date:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A27

(a) The club has 50 members each paying an annual subscription of Amount 500. Subscriptions Outstanding on 31st March,2017 were Amount 6,000.
(b) On 31st March, 2018, Salaries Outstanding amounted to Amount 2,000. Salaries paid in the year ended 31st March, 2018 included Amount 6,000 for the year ended 31st March, 2017.
(c) On 1st April, 2017, the club owned Building valued at Amount 2,00,000; Furniture Amount 20,000 and Books Amount 20,000.
(d) Provide depreciation on Furniture at 10%. 

Answer 43:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A28
TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A29
 

Question 44:  From the following Receipts and Payments Account and additional information given below, prepare Income and Expenditure Account and Balance Sheet of Rural Literacy Society as on 31st March, 2018:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A30

Additional information:
(i) Subscription outstanding as on 31st March, 2017 Amount 20,000 and on 31st March, 2018 Amount 15,000.
(ii) On 31st March, 2018, salary outstanding Amount 6,000 and one month rent paid in advance.
(iii) On 1st April, 2017, society owned furniture Amount 1,20,000 and books Amount 50,000. 

Answer 44:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A31

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A32

 

Question 45:  Glaxo Club's Balance Sheet as at 1st April, 2018 was as under:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A33

Subscriptions still to be received are Rs. 5,500 but subscriptions already received include Rs. 4,000 for next year. Salaries still unpaid are Rs. 6,000. Sports Equipment’s are now valued at Rs. 45,000. Prepare Income and Expenditure Account and the Balance Sheet, after charging 10% depreciation on Billiards Tables. 

Answer 45:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A34

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A35

 

Question 46:  From the following information relating to the Star Cricket Club, prepare Income and Expenditure Account for the year ended 31st March, 2018 and Balance Sheet as at that date. The summary of cash transactions is:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A36

Answer 46:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A37

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A38

 

Question 47:  From the following Receipts and Payments Account of Mumbai Theatre Club, prepare Income and Expenditure Account for the year ended 31st March, 2019 and Balance Sheet as at that date. 

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A39

 

Additional Information:
(i) Subscriptions in arrear for the year ended 31st March, 2019 Rs. 9,000 and subscriptions in advance for the year ended 31st March, 2019 Rs. 3,500.
(ii) Insurance Premium outstanding Rs. 400.
(iii) Miscellaneous expenses prepaid Rs. 900.
(iv) 8% interest has accrued on investment for five months.
(v) Billiard Table costing Rs. 3,00,000 was purchased during last year and Rs. 2,20,000 were paid for it. 

 

Answer 47:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A40

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A41

 

 

Question 48:  Following Receipts and Payments Account was prepared from the Cash Book of Delhi Charitable Trust for the year ending 31st March, 2018:
TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A42

Prepare Income and Expenditure Account for the year ended 31st March, 2019, and Balance Sheet as on that date after the following adjustments:
(i) Insurance premium was paid in advance for three months.
(ii) Interest on investment Rs.11,000 accrued was not received.
(iii) Rent Rs. 6,000; Salary Rs. 9,000 and advertisement expenses Rs. 10,000 outstanding as on 31st March, 2019.

 

Answer 48:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A43

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A44

 

 

Question 49:  Given Below is the Receipts and Payments Account of a Mayur Club for the year ended 31st March, 2019:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A45

Prepare club's Income and Expenditure Account for the year ended 31st March, 2019 and Balance Sheet as at that date after taking the following information into account:
(i) There are 500 members, each paying an annual subscription of Rs. 500, Rs. 5,000 are still in arrears for the year ended 31st March, 2018.
(ii) Municipal Taxes amounted to Rs. 4,000 per year is paid up to 30th June and Rs. 5,000 are outstanding of salaries.
(iii) Building stands in the books at Rs. 5,00,000.
(iv) 6% interest has accrued on investments for five months. 

Answer 49:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A46

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-A47

 

Question 50:  From the following Receipts and Payments Account of Imran Khan club and from the given additional information, prepare Income and Expenditure Account for the year ending 31st December, 2015 and the Balance Sheet as at that date: 

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-B

Additional Information:
(i) The club had received Amount 20,000 for subscription in 2017-18 for 2018-19.
(ii) Salaries had been paid only for 11 months
(iii) Stock of sports materials on 31st December, 2018 was Rs. 3,00,000 and on 31st December, 2015 Rs. 6,50,000

Answer 50:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-B1

 

Question 51:  From the following information and Receipts and Payments Account of Delhi Medical Society, prepare Income and Expenditure Account for the year ended 31st March, 2019 and Balance Sheet as at that date. 

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-B2

Other information:
On 31st March, 2018, the club possessed books of Rs. 2,00,000 and Furniture of Rs. 85,000. Provide depreciation on these assets @ 10% including the purchases during the year.
Subscriptions in arrears in the beginning of the year amounted to Rs. 3,500 and at the end of the year Rs. 5,500 were outstanding.
The Club paid three months' rent in advance both in the beginning and at the end of the year. 

Answer 51:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-B3

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-B4

 

 

Question 52:  Receipts and Payments Account of Shankar Sports Club is given below, for the year ended 31st March, 2019:TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-B5

Prepare Income and Expenditure Account and Balance Sheet with the help of following information:
Subscription outstanding on 31st March, 2018 is Rs. 1,200 and Rs. 2,300 on 31st March, 2018; opening stock of postage stamps is Rs. 300 and closing stock is Rs. 200; Rent Rs. 1,500 related to the year ended 31st March, 2018 and Rs. 1,500 is still unpaid. On 1st April, 2018 the club owned furniture Rs. 15,000, Furniture valued at Rs. 22,500 on 31st March, 2018. The club has a loan of Rs. 20,000 (@10% p.a.) which was taken, in year ended 31st March,2018. 

Answer 52:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-B6
 
TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-B7
 

Question 53:  From the following particulars relating to the Ramakrishna Mission Charitable Hospital, prepare Income and Expenditure Account for the year ended 31st March, 2019 and Balance Sheet as at that date.

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-B8

Answer 53:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-B9
TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-B10
 

Question 54:  Following is the Receipt and Payment Account of Women's Welfare Club for the year ended 31st March, 2019:  

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-B11

Prepare Income and Expenditure Account for the year ended 31st March, 2019, and Balance Sheet as on that date.  

Answer 54:

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-B12

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-B13

 

Point to Remember:-

1)     Calculate Opening Capital Fund: If opening balance of the Capital Fund is not given, Balance Sheet in the beginning of the year is prepared. It is prepared by taking the opening cash and bank balance as given in the Receipts and Payment Account, other assets and liabilities as given in the additional information.

2)     Determine Items of Income from Receipts and Payment Account: Receipts and Payment Account records all receipts, whether they relate to current, previous or future periods and whether they are of revenue or capital nature.

TS Grewal Solution Class 12 Chapter 1 Financial Statement of Not for Profit Organisations 2020 2021-B14