Advanced Level Examination - Unit 08

Not-for-Profit Organizations - Answers

Example No. 01 (Page 03) Example No. 02 (Page 04)
Receipts and Payments Account (Rs.’000) Receipts and Payments Account (Rs.’000)
Opening balance 4 800 Sports items 2 400 Opening balance 700 Stationery 200
Membership 9 600 Salaries 3 600 Subscription 2 600 Postage 100
Donations 1 800 Rent 1 200 Loan - Chairman 300 Sports meet expense 800
News papers 200 Electricity 800 News papers 100 Sports equipment 600
News papers 1 400 Donations 3 000 News papers 300
Stationery 600 Entrance fees 300 Salaries 600
Entertainment 500 Interest 50
Postage 1 200 Donations 100
Furniture 2 200 Investments 200
13 900 Entertainment 50
Balance 2 500 Motor cycle 400
16 400 16 400 Advertisement 50
Furniture 500
Rent 360
Loan settlement 100
Film hire charges 200
Example No. 03 (Page 05) Electricity 250
Income and Expenditure Account (Rs.’000) 4 860
Equipment depre 8 000 Subscription 46 000 Balance 2 140
Sports day exp. 2 000 Sports day income 8 000 7 000 7 000
Entertainment 5 000 Donations 2 100
Equip. repairs 4 000 Interest 600
Transport 2 800 Sundry income 200 Example No. 04 (Page 08)
Donations 1 600 Subscription Account (Rs.’000)
Electricity 300 Opening arrears 89 Opening advance 92
Insurance 200 Income 923 Cash received 930
Office rent 500 Closing advance 80 Closing arrears 70
Staff salaries 2 900 1 092 1 092
Equip. maint. 400
Interest 300 Example No. 05 (Page 09)
Other expense 300 Subscription Account (Rs.’000)
Magazine 400 Opening arrears 40.0 Opening advance 22.5
28 700 Income 406.0 Cash received 430.5
Surplus 28 200 Closing advance 23.5 Closing arrears 16.5
56 900 56 900 469.5 469.5

Example No. 06 (Page 09) Example No. 07 (Page 10)

Subscription Account (Rs.’000) Subscription Account (Rs.’000)
Opening arrears 72.5 Opening advance 92.2 Opening arrears 6.0 Opening advance 9.5
Income 1 391.4 Cash received 1 361.0 Income 63.0 Cash received 58.5
Closing advance 43.5 Closing arrears 54.2 Closing advance 4.5 Closing arrears 5.5
1 507.4 1 507.4 73.5 73.5

Example No. 08 (Page 10) Example No. 09 (Page 11)

Subscription Account (Rs.’000) Subscription Account (Rs.’000)
Opening arrears 30 Opening advance 20 Opening arrears 70 Opening advance 44
Income 970 Cash received 1 000 Income 890 Cash received 870
Closing advance 60 Closing arrears 40 Closing advance 19 Closing arrears 65
1 060 1 060 979 979
 -02-

Example No. 10 (Page 11) Advanced Level - 2013 (Page 12)

Subscription Account (Rs.’000) (a) Rs. 50 000 (Rs. 1 000 per member × 50 members)
(b) Rs. 7 000
Opening arrears 0.7 Opening advance 1.1
Subscription Account (Rs.’000)
Income 120.0 Cash received 119.7
Closing advance 0.6 Closing arrears 0.5 Opening advance 3
Income 50 Cash received 45
121.3 121.3
Closing advance 5 Closing arrears 7
Opening arrears = (4 × 2 × 50) + (6 × 50) = Rs. 700 55 55
Opening advance = (8 × 2 × 50) + (6 × 50) = Rs. 1 100
Income = (200 × 50 × 12 months) = Rs. 120 000
Closing arrears = (5 × 2 × 50) = Rs. 500
Closing advance = (12 × 50) = Rs. 600
Advanced Level - 2007 (Page 12) : (3)
Total cash collected = 1 + 15 + 1 = Rs. 17 000

Advanced Level - 2016 (Page 13) : (3) Advanced Level - 2007 (Page 12) : (4)
Subscription income + FD interest – Total expenses + Subscription Account (Rs.’000)
Donations
Opening arrears 4 Opening advance 1
(100 members × Rs. 4 000 per member) +
50 000 – 300 000 + (500 000 ÷ 5) = Rs. 250 000 Income 21 Cash received 17
Closing advance 1 Closing arrears 8
Advanced Level - 2016 (Page 13) : (3) 26 26
Donations received + Subscription received – Expenses paid
500 000 + 360 000 – 300 000 = Rs. 560 000 Advanced Level - 2007 (Page 13): (3)

Advanced Level - 2017 (Page 14) Advanced Level - 2018 (Page 14)
(a) Rs. 60 000 (Rs. 1 000 per member × 60 members) (b) Rs. 240 000 (Rs. 2 400 per member × 100 members)
(b) Rs. 70 000 (b) Rs. 264 000
Subscription Account (Rs.’000) Subscription Account (Rs.’000)
Opening arrears 20 Opening advance 60 Opening arrears 48 Opening advance 12
Income 60 Cash received 70 Income 240 Cash received 264
Closing advance 80 Closing arrears 30 Closing advance 24 Closing arrears 36
160 160 312 312

Example No. 11 (Page 15) Example No. 12 (Page 15) Example No. 13 (Page 15)
(1) 250 000 – 50 000 = Rs. 200 000 (1) 460 000 – 160 000 = Rs. 300 000 (1) 1 100 000 – 600 000 = Rs. 500 000
(2) 200 000 × 50% = 100 000 (2) 300 000 × 80% = 240 000 (2) 500 000 × 60% = 300 000

Example No. 14 (Page 16) Example No. 15 (Page 17)

Subscription Account (Rs.’000) Life Membership Account (Rs.’000)
Opening arrears 1 Opening advance 2 Income (500 ÷ 10) 50 Cash received 500
Income 19 Cash received 19 Closing balance 450
Written off 1 500 500
Closing advance 3 Closing arrears 1
23 23
Example No. 16 (Page 17)
Income = 95 members × 200 = Rs. 19 000
Closing advance = 15 members × 200 = Rs. 3 000 Life Membership Account (Rs.’000)
Cash received = Current year = 80 members Income (1 500 ÷ 20) 75 Cash received 1 500
Next year = 15 members Closing balance 1 425
Total = 80 + 15 = 95, = 95 members × 200 = Rs. 19 000
1 500 1 500
Written off = 5 members × 200 = Rs. 1 000

Answers for the Theory Questions - Unit 08 (Not-for-profit organizations) - Accounting - By Nilantha Agampodi - CCS - Colombo
 -03-

Example No. 17 (Page 18) Example No. 18 (Page 19)

Subscription Account (Rs.’000)
Entrance Fees Account (Rs.’000)
Opening arrears 30 Opening advance -
Income (600 × 50%) 300 Cash received 600
Income (50 × 3) 150 Cash received 147
Closing balance 300
Closing advance 15 Closing arrears 48
600 600
195 195

Life Membership Account (Rs.’000) Example No. 20 (Page 22)

Income (300 ÷ 10) 30 Cash received 300 Accumulated Fund = Rs. 2 480 000
Closing balance 270 Statement of affairs (Rs.’000)
300 300 Accumulated Fund 2 480 Assets
Office buildings 2 000
Liabilities Office equipment 500
Example No. 19 (Page 22)
Subscription advance 200 Canteen inventories 270
Accumulated Fund = Rs. 1 250 000
Expenses payable 90 Subscription receivable 300
Statement of affairs (Rs.’000)
Bank loan 500 Prepaid expenses 70
Accumulated Fund 1 250 Assets
Life membership fund 400 Cash and bank 530
Land & buildings 1 000
3 670 3 670
Liabilities Furniture 400
Subscription advance 100 Unused stationery 50
Advanced Level - 2017 (Page 23): (1)
Electricity payable 25 Subscription receivable 100
Closing net assets – Opening net assets
Building fund 150 Prepaid insurance 15 (750 + 10 + 80 – 600 – 50) – (800 + 20 + 80 – 800 – 40)
Life membership fund 100 Cash 60 = 190 000 – 60 000 = Rs. 130 000
1 625 1 625
Example No. 21 (Page 23) Answer No. (5)

Advanced Level - 2019 (Page 24): (2)

Income = Subscription 150 × 2 000 + Donation 250 000 ÷ 5 years = 300 000 + 50 000 = Rs. 350 000
Increase in assets = Subscription received 200 000 + Donations received 250 000 + Proceeds from fixed deposits 560 000 +
Subscription receivable 100 000 – Decrease in fixed deposit 500 000 – Decrease in interest receivable 60 000 = Rs. 550 000

Example No. 22 (Page 24)

Accumulated Fund = Rs. 460 000 Income Statement for the Canteen (Rs.’000)
Statement of affairs (Rs.’000) Opening stock 60 Sale of cool
Accumulated Fund 460 Assets Purchases (W1) 140 drinks 176
Fixtures and fittings 200 Closing stock (40)
Liabilities Subscription receivable 40 160
Subscription advance 16 Canteen inventories 60 Profit 16
Creditors 50 Prepaid rent 40 176 176
Cash 186
Working 1:
526 526
Creditors Control Account (Rs.’000)
Cash paid 120 Opening balance 50
Subscription Account (Rs.’000) Closing balance 70 Purchases 140
Opening arrears 40 Opening advance 16 190 190
Income 426 Cash received 440
Closing advance 22 Closing arrears 32
Income & Expenditure Account (Rs.’000)
488 488
Rent (W1) 250 Subscription 426
Depreciation of fixture (W2) 36 Canteen profit 16
Lotteries Account (Rs.’000) Electricity 50 Lotteries profit 56
Expenses Income Office expanses 54
Printing of tickets 24 Sale of tickets 120 Surplus 108
Prizes 40 498 498
Profit 56
Refer the next page for Working 1and Working 2
120 120

Answers for the Theory Questions - Unit 08 (Not-for-profit organizations) - Accounting - By Nilantha Agampodi - CCS - Colombo
 -04-

Working 1: Statement of financial position

Rent Account (Rs.’000) As at 31st March, 2021 (Rs.’000)
Opening balance 40 Income & Expenditure 250 Accumulated fund 460 Non-current assets
Cash 240 Closing balance 30 Surplus 108 Fixtures (336 – 36) 300
568 Current assets
280 280
Current liabilities Canteen stock 40
Working 2:
Canteen creditors 70 Subscription in arrears 32
Fixtures & Fittings Account (Rs.’000)
Subscription in advance 22 Prepaid rent 30
Opening balance 200 Depreciation 36
Cash 258
Cash 136 Closing balance 300
660 660
336 336

Example No. 23 (Page 25) Income & Expenditure Account (Rs.’000)

Accumulated Fund = Rs. 10 000 Stationery (W2) 2 Subscription (W1) 25
Statement of affairs (Rs.’000) Rent (W3) 16 Donations 18
Accumulated Fund 10 Assets Meeting expenses (W4) 6 Annual dinner 7
Cash 3 Other expenses (W5) 1
Liabilities Subscription receivable 3 Commission expenses 3
Subscription advance 2 Stationery 2 Donations to charity 15
Other accrued expense 1 Prepaid rent 3 Dinner expenses 11 Deficit 4
Prepaid meeting exp. 2 54 54
13 13 Working 1:
Subscription Account (Rs.’000)
Opening arrears 3 Opening advance 2
Working 4:
Income 25 Cash received 25
Meeting Expenses Account (Rs.’000)
Closing advance 2 Closing arrears 3
Opening balance 2 Income & Expenditure 6
30 30
Purchases 5 Closing balance 1
Working 2:
7 7
Stationery Account (Rs.’000)
Working 5:
Opening balance 2 Consumption 2
Other Expenses Account (Rs.’000)
Cash 1 Closing balance 1
Cash 1 Opening balance 1
3 3
Closing balance 1 Income & Expenditure 1
Working 3:
2 2
Rent Account (Rs.’000)
Opening balance 3 Income & Expenditure 16
Cash 15 Closing balance 2
18 18

Statement of financial position

As at 31st March, 2021 (Rs.’000) "Success is not final;
Accumulated fund 10 Non-current assets failure is not fatal: It is
Deficit (4) Current assets
6 Cash (53 – 51) 2 the courage to
Current liabilities Subscription receivable 3 continue that
Other accrued expenses 1 Stationery 1
Subscription in advance 2 Prepaid rent 2 counts..."
Prepaid meeting expenses 1
9 9

Answers for the Theory Questions - Unit 08 (Not-for-profit organizations) - Accounting - By Nilantha Agampodi - CCS - Colombo
 -05-

Question No. 01 (Page 26) Working 1:

Statement of affairs (Rs.)
Subscription Account (Rs.) Accumulated Fund 7 300 Assets
Opening arrears 1 000 Opening advance 500 Equipment 5 000
Income 17 550 Cash received 16 500 Liabilities Subscription receivable 1 000
Closing advance 450 Closing arrears 2 000 Subscription advance 500 Cash 1 800
19 000 19 000 7 800 7 800

Income & Expenditure Account (Rs.)

Professional fees (1 440 – 440) 1 000 Subscription 17 550
Stationery (650 + 350) 1 000 Donations (5 000 × 40%) 2 000
Equipment depreciation (6 250 × 20%) 1 250 Sports events receipts 3 150
Rent 3 000
Equipment repairs 460
Salaries 5 200
Other expenses 660
Surplus 10 130
22 700 22 700

Statement of financial position

As at 31st March, 2021
Accumulated fund 7 300 Non-current assets
Add: Surplus 10 130 Equipment (6 250 – 1 250) 5 000
17 430
Non-current liabilities "It is better to fail in
Building fund (5 000 × 60%) 3 000 Current assets
Current liabilities Subscription receivable 2 000
originality than to
Stationery payable 350 Prepaid professional fees 440 succeed in imitation..."
Subscription in advance 450 Cash 13 790
21 230 21 230

Question No. 02 (Page 27) Income Statement for the Canteen (Rs.’000)
Opening stock 50 Sales (W2) 180
Flag Day Income Account (Rs.’000) Purchases (W1) 100
Expenses Income Closing stock (60)
Printing 20 Income received 140 90
Entertainment 15 Salaries 60
Traveling 5 Profit 30
Profit 100 180 180
140 140 Working 1:
Creditors Control Account (Rs.’000)
Cash paid 80 Opening balance 30
Subscription Account (Rs.) Closing balance 50 Purchases 100
Opening arrears 1 200 Opening advance 2 400
130 130
Income (Note 1) 180 000 Cash received 176 400
Working 2:
Closing advance 3 600 Closing arrears 6 000
Debtors Control Account (Rs.’000)
184 800 184 800
Opening balance 40 Cash received 160
Note 1: 150 members × 100 per month × 12 months = Rs. 180 000 Sales 180 Closing balance 60
220 220

Answers for the Theory Questions - Unit 08 (Not-for-profit organizations) - Accounting - By Nilantha Agampodi - CCS - Colombo
 -06-

Statement of financial position

Income & Expenditure Account (Rs.’000)
As at 31st March, 2021 (Rs.’000)
Sports items deprecia. (W1) 30 Subscription 180
Accumulated fund 978.8 Non-current assets
(Working 1) Sports complex 680 Salaries 60 Government grants 100
Add: Surplus 220 Sports items 220 Rent 30 Sundry income 10
1 198.8 Books & magazines 50 Electricity 10 Flag day profit 100
Current liabilities Current assets Telephone 5 Canteen profit 30
Creditors - Canteen 3.6 Inventories 60 Other expenses 15
Subs. advance 50 Debtors 60 Donations 50
Subs. receivable 6 Surplus 220
Cash 176.4 420 420
1 252.4 1 252.4 Working 1:
Sports Items Account (Rs.’000)
Working 1: Opening balance 150 Depreciation 30
Statement of affairs (Rs.’000) Cash 100 Closing balance 220
Accumulated Fund 978.8 Assets 250 250
Liabilities Sports complex 600
Creditors - Canteen 2.4 Sports items 150
Books & maga. 50
Inventories 50
Debtors 40
Subs. receivable 1.2 Income & Expenditure Account (Rs.’000)
Subscription advance 30 Cash 120 Sp. complex dep. (1000 – 950) 50 Subscription 353
1 011.2 1 011.2 Sports items deprecia. (W1) 30 Entrance fees 6
Furniture depreciation (W2) 40 Donations 80
Printing (W3) 26 FD interest 18
Electricity (W4) 25 Canteen profit 95
Question No. 03 (Page 28)
Ground maintenance 60
Subscription Account (Rs.’000) Telephone 15
Sports expenses 82
Opening arrears 14 Opening advance 8
Miscellaneous 12
Income 353 Cash received 360
Surplus 212
Closing advance 6 Closing arrears 5
552 552
373 373
Working 1:
Sports Items Account (Rs.’000)
Income Statement for the Canteen (Rs.’000) Opening balance 225 Depreciation 30
Opening stock 60 Sales (W2) 337 Cash 135 Closing balance 330
Purchases (W1) 140 360 360
Closing stock (48) Working 2:
152 Furniture Account (Rs.’000)
Salaries 90 Opening balance 250 Depreciation 40
Profit 95 Cash 150 Closing balance 360
337 337 400 400
Working 1: Working 3:
Creditors Control Account (Rs.’000) Printing Account (Rs.’000)
Cash paid 120 Opening balance 50 Opening balance 8
Closing balance 70 Purchases 140 Cash 34 Expense for the year 26
190 190 34 34
Working 2: Working 4:
Debtors Control Account (Rs.’000) Electricity Account (Rs.’000)
Opening balance 80 Cash received 325 Cash 24 Opening balance 2
Sales 337 Closing balance 92 Closing balance 3 Expense for the year 25
417 417 27 27

Answers for the Theory Questions - Unit 08 (Not-for-profit organizations) - Accounting - By Nilantha Agampodi - CCS - Colombo
 -07-

Statement of financial position Working 1:

As at 31st March, 2021 (Rs.’000) Statement of affairs (Rs.’000)
Accumulated fund 1 781 Non-current assets Accumulated Fund 1 781 Assets
(Working 1) Sports complex 950 Liabilities Sports complex 1 000
Add: Surplus 212 Sports items 330 Creditors - Canteen 50 Sports items 225
1 993 Furniture 360 Subs. advance 8 Furniture 250
Fixed deposits 100 Printing payable 8 Fixed deposits 100
Current liabilities Current assets Electricity payable 2 Inventories 60
Creditors - Canteen 70 Inventories 48 Debtors 80
Subs. advance 6 Debtors 92 Subs. receivable 14
Electricity payable 3 Subs. receivable 5 Cash 120
Cash 187
1 849 1 849
2 072 2 072

Income & Expenditure Account (Rs.’000)

Question No. 04 (Page 29)
Sp. complex dep. (300 – 285) 15 Subscription (W2) 82
Sports equipment deprecia. (W1) 8 Life membership 5
Income Statement for the Canteen (Rs.’000)
Sports day expenses 8 Entrance fees 5
Opening stock 12 Sales 59
Other expenses 4 Rent income 16
Purchases 34
Office equipment dep. (60 – 54) 6 Sports day income 15
Closing stock (9)
Electricity 8 Canteen profit 17
37
Rent 6
Expenses 5
Salaries 17
Profit 17
Entertainment 11
59 59
Donations 2
Loan interest 1
Working 2: Surplus 54
Subscription Account (Rs.’000)
140 140
Opening arrears 6 Opening advance 5
Income 82 Cash received 80 Working 1:
Closing advance 2 Closing arrears 5 Sports Equipment Account (Rs.’000)

90 90 Opening balance 140 Depreciation 8

Cash 20 Closing balance 152
160 160

Working 1:
Statement of financial position Statement of affairs (Rs.’000)
As at 31st March, 2021 (Rs.’000) Accumulated Fund 862 Assets
Accumulated fund (W 1) 862 Non-current assets Liabilities Play ground 400
Add: Surplus 54 Play ground 400 Bank loan 20 Sports complex 300
Add: Donations 10 Sports complex 285 Life membership 40 Sports equipment 140
926 Sports equipment 152 Subs. advance 5 Office equipment 60
Non- Current liabilities Office equipment 54 Electricity payable 3 Inventories 12
Bank loan 20 Subs. receivable 6
Life membership (W 2) 45 Cash 12
Current assets 930 930
Current liabilities Inventories 9 Working 2:
Subs. advance 2 Subs. receivable 5 Life Membership Account (Rs.’000)
Electricity payable 4 Cash 92 Income (50 × 10%) 5 Opening balance 40
997 997 Closing balance 45 10
50 50

Answers for the Theory Questions - Unit 08 (Not-for-profit organizations) - Accounting - By Nilantha Agampodi - CCS - Colombo
 -08-

Question No. 05 (Page 30)

Colombo Club
Receipts and Payments Account for the year ended 31.12.2007 W1 Subscription
Balance C/F 3 100 Salaries (W 2) 47 000 Balance 6 000 Balance 4 500
Subscription (W 1) 71 700 General ex(W 3) 7 600 Inc. & Ex. 75 000 Rec. & Pmt. 71 700
Entrance fees 2 500 Annual dinner 15 000 Balance 2 700 Balance 7 500
Annual dinner 10 000 Sports festival 80 000 83 700 83 700
Sports festival 88 500 Balance C/D 26 200
175 800 175 800 W2 Salaries
Balance 4 000
Working 3 R. & Pmt. 47 000 Inc. & Ex. 47 500
General expenses paid = Expense + Prepaid amount Balance 4 500
= Rs. 7 000 + 600 = Rs. 7 600 51 500 51 500

Question No. 06 (Page 30)

(1) Membership Fees Account (2) Life Membership Fees Account

Balance b/f 3 000 Receipts & Income & Receipts &
Income & expenditure 15 000 payments 14 700 expenditure 3 000 payments 30 000
[300 × (60 - 10)] (Working 1)
Balance c/d 1 500 Balance c/d 4 800 Balance c/d 27 000
19 500 19 500 30 000 30 000
Balance b/f 4 800 Balance b/f 1 500 Balance b/f 27 000

(3) Samagi Sports Club (4) Samagi Sports Club

Trading account for the year ending 31.12.2005 Income and expenditure account
Sales 65 000 Income
Cost of Sales Membership fees 15 000
Stocks (01.01.2005) 10 000 Life membership fees 3 000
Purchases 20 000 Ground rent 50 000
30 000 Canteen profit 12 000
Stocks (31.12.2005) (7 000) 80 000
(23 000) Expenses
Gross Profit 42 000 Salaries - grounds man 36 000
Canteen salary (30 000) Salaries - clerk 24 000
Net profit 12 000 Depreciation - furniture 5 000
(Rs.30 000 - Rs.25 000)
Working 1 Rs. Ground preparation expenses 5 000
Life membership fees received = 30 000 Rent 20 000
Current year's income = 30 000 ÷ 10 Telephone 6 000
= 3 000 (96 000)
Deficit for the period 16 000

Question No. 07 (Page 31)

(i)
Subscription Account for the year 2021
Opening subscription in arrears 5 000 Opening subscription received in advance 2 000
Income and expenditure 100 000 Receipts and payments account 102 000
Closing subscription received in advance 3 000 Closing subscription in arrears 4 000
108 000 108 000

Answers for the Theory Questions - Unit 08 (Not-for-profit organizations) - Accounting - By Nilantha Agampodi - CCS - Colombo
 -09-

(ii)
Gehan Sport Club
Income and expenditure account for the year ended December 31st 2021
General expenses 5 000 Subscription 100 000
Ground maintenance 20 000 Net proceeds from musical show 60 000
Depreciation of equipment (W1) 15 000
Telephone charges (W2) 10 000
Rent (W3) 30 000
Surplus 80 000
160 000 160 000

WORKINGS
W1 Sports equipment W2 Telephone charges

Balance c/f 165 000 Depreciation 15 000 Receipts & Pmt. 9 000 Balance c/f 2 000
Receipts & Pmt. 50 000 Balance c/d 200 000 Balance c/d 3 000 Income & Exp. 10 000
215 000 215 000 12 000 12 000

W3 Rent
Balance c/f - Income & Exp. 30 000
Receipts & Pmt. 50 000 Balance c/d 20 000
50 000 50 000
Question No. 09 (Page 32) : (2)
Subscription Account (Rs.’000)
Question No. 08 (Page 32) Opening arrears 10 Opening advance 10
(a) Rs. 7 000 (Total assets 2012 – Total assets 2011) Income 74 Cash received 79
(b) Rs. 19 500 (As there are no liabilities, total assets are Closing advance 20 Closing arrears 15
equal to the accumulated fund) 104 104

Question No. 10 (Page 33) : A/L - 2012

Accumulated Fund = Rs. 242 000
Statement of affairs (Rs.’000)
Subscription Account (Rs.’000)
Accumulated Fund 242 Assets
Opening arrears 10 Opening advance 8
Liabilities Furniture 180
Income (50 × 2) 100 Cash received 108
Subscription advance 8 English books 50
Closing advance 12 Closing arrears 6
Subscription receivable 10
122 122
Cash 10
250 250
Receipts and Payments Account (Rs.’000)
Income & Expenditure Account (Rs.’000) Balance C/F 10 English books 100
Books expenses (Working 1) 90 Subscription 100 Donations 200 Office rent 60
Office rent 60 Donations 200 Subscription 108 Salaries 60
Salaries 60 Office expenses 30
Office expenses 30 Balance C/D 68
Furniture depreciation (180 – 160) 20 318 318
Surplus 40
300 300

Working 1:
Books expenses = Opening stock + Purchase of books – Closing stock
= 50 + 100 – 60 = Rs. 90 000

Answers for the Theory Questions - Unit 08 (Not-for-profit organizations) - Accounting - By Nilantha Agampodi - CCS - Colombo
 -010-

Question No. 11 (Page 34) : A/L - 2013

Income & Expenditure Account (Rs.’000)

Swimming pool expenses: Swimming pool income 2 000
Annual salary - Pool keeper 300 Canteen income (300 × 20%) 60
Annual salary - Other staff 1 200 Interest income (1 200 × 10% × 4/12 months) 40
Other expenses 300 Subscription 1 230
Swimming pool depreciation (4 000 – 3 750) 250
Buildings depreciation (2 400 – 2 000) 400
Surplus 880
3 330 3 330

Receipts and Payments Account (Rs.’000)

Balance C/F 100 Swimming pool expenses:
Subscription 1 220 Annual salary - Pool keeper 300
Swimming pool income (2 000 + 50 – 60) 1 990 Annual salary - Other staff 1 200
Canteen income (300 × 20%) 60 Other expenses 300
Fixed deposits 1 200
Balance C/D 370
3 370 3 370

Accumulated Fund = Rs. 7 400 000

Statement of affairs as at 31.03.2013 (Rs.’000)
Accumulated Fund 7 400 Assets
Liabilities Buildings 2 000
Hiring income received in advance 50 Swimming pool 3 750
Fixed deposits 1 200
Fixed deposits interest receivable 40
Subscription receivable 90
Cash 370
7 450 7 450

OR

Closing Accumulated Fund = Opening Accumulated Fund + Surplus for the year
Closing Accumulated Fund = 6 520 000 (Working 1 on Page 10) + 880 000 = Rs. 7 400 000

Working 1:
Statement of affairs as at 31.03.2012 (Rs.’000)
Accumulated Fund 6 520 Assets
Liabilities Buildings 2 400
Hiring income received in advance 60 Swimming pool 4 000
Subscription receivable 80
Cash 100
6 580 6 580

"The road to success and the road to failure are almost exactly the same..." (Colin R. Davis)

..."
Answers for the Theory Questions - Unit 08 (Not-for-profit organizations) - Accounting - By Nilantha Agampodi - CCS - Colombo
 -011-

Question No. 12 (Page 35) : A/L - 2014

Receipts and Payments Account (Rs.’000)

Admission fee (50 members × 500) 25 Facility fees (2 000 × 10 months) 20
Subscription (Working 1) 285 Travelling fee for the instructor (3 000 × 10 months) 30
Course fees (Working 2) 270 Allowance to manager (10 000 × 11 months) 110
Stationery 60
Three-wheeler 20
Balance C/D 340
580 580

Income & Expenditure Account (Rs.’000)

Facility fees (2 000 × 10 months) 20 Admission fee 25
Travelling fee for the instructor (3 000 × 10 months) 30 Subscription income (Working 3) 300
Three-wheeler depreciation (360 000 ÷ 4 years) 90 Course fees (Working 4) 250
Allowance to manager (10 000 × 12 months) 120 Three-wheeler donations (360 000 ÷ 4 years) 90
Stationery 40
Three-wheeler expenses 20
Surplus 345
665 665

Accumulated Fund as at 31.03.2014 = Rs. 345 000 (It is same as the Surplus for the year as there is no opening balance)

OR

Statement of affairs as at 31.03.2014 (Rs.’000)

Accumulated Fund 345 Assets
Liabilities Cash 340
Course fees received in advance 40 Three-wheeler (360 – 90) 270
Donations (360 – 90) 270 Subscription receivable (300 – 285) 15
Allowance payable to the manager 10 Course fees receivable (270 – 250) 20
Stationery 20
665 665

Question No. 13 (Page 36) : A/L - 2018

Income Statement for the year ending
31.12.2017 ❽
Cash Account for the year 31.12.2017 (Rs.’000) ❽ Income
Opening balance 20 Electricity 120 Entrance fees 50
Entrance fees ① 50 Refreshment 170
FD interest 70
Subscription ① 1 280 Stationery 200
Subscription ① 1 600 1 720
Fixed deposits ① 1 400 Maintenance 160
Expenses
FD interest ① 70 Buildings 1 000
Electricity ① 100
Balance ① 1 170
Refreshment 170
2 820 2 820
Stationary ① 240
Entrance fees = 1 000 × 50 members = Rs. 50 000 Maintenance 160
Subscription = 2 000 × 640 members = Rs. 1 280 000 Get-together ① 550
FD interest = 1 400 × 10% × 6/12 = Rs. 70 000 ① 450
Depreciation (1 670)
Surplus ① 50

Answers for the Theory Questions - Unit 08 (Not-for-profit organizations) - Accounting - By Nilantha Agampodi - CCS - Colombo
 -012-

Equity as at 31.12.2017 ❹
Equity Items (Rs.’000)
Description Accumulated Fund Building Construction Fund
Balance as at 01.01.2017 4 580 1 400
Additions:
Surplus ① 50
Building fund ① 1 400
Deductions:
Accumulated fund ① (1 400)
Balance as at 31.12.2017 ① 6 030 -

Question No. 14 (Page 37) : A/L - 2019

Receipts and Payments Account (Rs.’000)
Opening balance 80 Office equipment 300
Subscription 300 Salaries 180
Entrance fees 140 Office rent 10
Donations - Direct deposit 20
Balance C/D 50
540 540

(2) Bank Reconciliation Statement (Rs.'000)

Adjusted Cash account Balance 50
Add :
Unpresented Cheque 130
130
Less : 180
Unrealized Cheque 40 (40)
Bank statement balance 140

Income & Expenditure Account (Rs.’000)

Salaries (180 + 30) 210 Subscription income 350
Office rent 10 Subscription 140
Depreciation 100 Donations 20
Surplus 190
510 510

Subscription received in advance = Rs. 70 000

Accumulated fund = Rs. 1 010 000

Opening accumulated fund (Working 1) + Surplus for the year = 820 000 + 190 000 = Rs. 1 010 000

Working 1:
Accumulated fund = Assets – Liabilities
= (PPE + Subscription receivable + Cash) – (Subscription in advance)
= (800 + 40 + 80) – (100) = Rs. 820 000

***
Answers for the Theory Questions - Unit 08 (Not-for-profit organizations) - Accounting - By Nilantha Agampodi - CCS - Colombo