Use app×
Join Bloom Tuition
One on One Online Tuition
JEE MAIN 2025 Foundation Course
NEET 2025 Foundation Course
CLASS 12 FOUNDATION COURSE
CLASS 10 FOUNDATION COURSE
CLASS 9 FOUNDATION COURSE
CLASS 8 FOUNDATION COURSE
0 votes
2.7k views
in Accounts by (15.7k points)

Talent sports Club is engaged in the activity of identifying and promoting sports talent from rural and tribal areas of the country. Identifying with this Noble cause Mr Manohar a renowned industrialist donated ₹ 50,00,000 on 1stJuly 2020, for the construction of a new hostel and mess for upcoming sportsmen. 

Besides this Mr Manohar offered the services of his personal chartered accountant,free of charge, to streamline the account of Total Sports Club. The chartered accountant visited the office of the NPO on 31st March 2021 and found that till date rupees 35,00,000 had been spent on construction of hostel and mess building. he also noted that the NPO had a capital fund of Rs.1,20,00,000 in the beginning of the year. Other important points that he noted were that NPO had 2000 regular members each having an annual subscription of Rs.2000 per annum. 

On 1stApril 2020, 180 members had not paid for subscription of previous year and 20 members had paid for 2020-2021 in advance (out of which 5 had paid advance of2021- 2022 as well) 

31st March 2021, 110 Members he had outstanding balance (hey including 50 who had not paid for 2019-20 as well) and 25 members had paid for 2021- 2022 in advance (including all 5 who had paid in advance in 2019-20) 

Since the accountant of NPO was not clear about how to deal with all the above information he drafted a set of questions for guidance. 

Considering that you are the Chartered Accountant of Mr. Manohar answer the following questions based on the information detailed above.

1 The amount of Rs. 50,00,000 received from Mr Manohar towards building and mess should be transferred to 

a. Capital fund 

b. General fund

c. Income and Expenditure account 

d. Building fund 

2 The amount of Rs. 35,00,000 spent on construction of building should be:

I. reflected on debit side of income and expenditure account as an expense. 

II. reflected on asset side of balance sheet. 

III. reflected as a deduction from Building fund and addition to capital fund.

IV. Not be recorded till the building is complete. 

On basis of given information choose which of the following stands true 

a. Only IV 

b. BothI and IV 

c. Both II and III 

d. None of these 

3 The amount of subscription in arears on 1st April 2020 is: 

a. ₹ 3,60,000 

b. ₹ 3,00,000 

c. ₹ 2,000

d. ₹ 1,80,000 

4. The amount of subscription in arears on 31st March 2021 is: 

a. ₹ 2,20,000 

b. ₹ 3,60,000 

c. ₹ 3,20,000 

d. ₹ 1,80,000 

5. The amount of subscription in advance on 31st March 2021 is: 

a. ₹ 40,000 

b. ₹ 50,000 

c. ₹ 10,000 

d. None of these 

6. The amount of subscription to be transferred to income and expenditure account for the year ended 31st March 2021 is: 

a. ₹ 40,00,000 

b. ₹ 20,00,000 

c. ₹ 43,20,000 

d. ₹ 43,60,000

Please log in or register to answer this question.

1 Answer

+1 vote
by (15.2k points)

1 (d) Building Fund 

2 ( c) Both II and III 

3 (a) Rs. 3,60,000 

4 ( c) Rs.3,20,000 

5 (b) Rs.50,000 

6 (a) Rs.40,00,000

Welcome to Sarthaks eConnect: A unique platform where students can interact with teachers/experts/students to get solutions to their queries. Students (upto class 10+2) preparing for All Government Exams, CBSE Board Exam, ICSE Board Exam, State Board Exam, JEE (Mains+Advance) and NEET can ask questions from any subject and get quick answers by subject teachers/ experts/mentors/students.

Categories

...