Please solve this question and what will be the entry for 2 adjustment and why - Accountancy - Accounting for Not-for-Profit Organisation

Question

Please solve this question and what will be the entry for 2
adjustment and why

Sakshi Gupta · Accepted Answer

Dear student
INCOME AND EXPENDITURE A/C

EXPENDITURE
AMOUNT
INCOME
AMOUNT

To depreciation A/C
7,875
By subscription A/C
52,000

To advertisement A/C
13,100
By donation A/C
20,000

To rent, rates, and taxes A/C
14,000
By interest on investment A/C
7,200

To repair A/C
15,000
By entrance fees A/C
6,000

To printing and stationary A/C
16,000
By proceeds from charity show A/C
16,200

To telephone expenses A/C
1,000

To surplus A/C
34,425

1,01,400

WORKING NOTE:
1
 Depreciation on plant = 70,000×15100×912= 7,8752
 subscription Account =subscription received during the previous year (416×125)                 = 52,000Add; subscription outstanding in the end (31st march 2019)                 = 7,000 subscription received in advance in the beginning (31st march 2018)= 4,000Less; subscription outstanding in the beginning (31st march 2018)  = (6,000)subscription received in the end in advance (31st march 2019) = (5,000)subscription to be shown inincome and expenditure A/C = 52,000

Regards

EXPENDITURE	AMOUNT	INCOME	AMOUNT
To depreciation A/C	7,875	By subscription A/C	52,000
To advertisement A/C	13,100	By donation A/C	20,000
To rent, rates, and taxes A/C	14,000	By interest on investment A/C	7,200
To repair A/C	15,000	By entrance fees A/C	6,000
To printing and stationary A/C	16,000	By proceeds from charity show A/C	16,200
To telephone expenses A/C	1,000
To surplus A/C	34,425

	1,01,400		1,01,400