Accounting For Not For Profit Organisation Class 12 Accountancy Exam Questions

Exam Questions Class 12

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Class 12 Accountancy Exam Questions Accounting For Not For Profit Organisation

Class 12 Accountancy students should read and understand the important questions and answers provided below for Accounting For Not For Profit Organisation which will help them to understand all important and difficult topics.

Question. Give to main sources of income of a ‘Not for profit organisation’.
Ans. (i) Subscription            (ii) Donation 

Question. State any two characteristics of Receipt and Payment Account.
Ans. (i) Receipts and Payments Account is a summary of Cash Book.
       (ii) Non- cash expenses such as depreciation and outstanding expenses are not shown in Receipts and Payments Account.

Question. How would you account for ‘subscription due to be received’ in the   current year in the books of a non trading organisation? 
Ans. Subscription due to be received is added with subscription received during the year in Income and Expenditure A/C and shown as an asset in the closing balance sheet.

Question. How would you account for ‘subscription received in advance’ in the current year in the books of a non trading organisation?
Ans. Subscription received in advance is subtracted from subscription received during the year in Income and Expenditure A/C and shown as a liability in the closing Balance sheet.

Question. What is meant by fund based accounting? 
Ans. Fund based accounting is a book peeping technique where by separate self-balancing sets of assets, liability, income, expenses and fund balance accounts are maintained for each contribution for a specific purpose.

Question. Tournament fund appears in the books Rs. 15,000 and expenses on tournament during the year were Rs. 18000. How will you show this in format while preparing financial statement of a not-for-profit organisation? 
Ans.                                                   Income and Expenditure A/C
                                                                        For the year ended ……… 

ExpenditureRs.IncomeRs.
To Tournament Expenses       18000   Less Tournament Fund                             15000    3000  

Question. As per Receipt and Payments account for the year ended on March 31, 2008, the subscription received were Rs. 2,50,000. Addition information given is as follows:-
(i) Subscriptions outstanding on 01-04-2007 Rs. 50,000.
(ii) Subscription outstanding on 31-03-2008 Rs. 35,000.
(iii) Subscription Received in advance as on 31-03-2008 Rs. 30000.          
         Ascertain the amount of income from subscription for the year 2007-08.
Ans. Calculation of current year subscription to be shown in Income and Expenditure A/C for the year ended March 31, 2008 :-
Total subscription received during the year                                                    250000
Add:-
        Outstanding subscription on 31-03-2008                          35000
        Advance subscription on 01-04-2007                               NIL                  35000
                                                                                                                 285000
Less :-
           Outstanding subscription on 01-04-07                       50000
           Advance subscription on 31-03-2008                         30000                (80000)
           Current year subscription                                                               205000 

Question. From the following extracts of Receipts and Payments Account and the additional information given below, compute the amount of income from subscriptions and show us how they would appear in the Income and Expenditure Account for the year ending March 31, 2007and the Balance sheet on that date:-
                                 Receipts and Payments A/C
                             For the year ending March 31, 2007 

ReceiptsRs.PaymentsRs.
Subscription :- 2005-06                          –      7000 2006-07                                –     30000 2007-08                                –       5000      42000      

Additional information:-
(i) Subscription outstanding on March 31, 2006 Rs. 8500.
(ii) Total subscriptions outstanding on March 31, 2007 Rs. 18,500.
(iii) Subscriptions received in advance as on March 31, 2006 Rs. 4000.
Ans.                                           Income and Expenditure A/C
                                             For the year ending March 31, 2007 

ExpenditureRs.IncomeRs.
  By Subscription                                30000 Add:- outstanding subscription for 2006 -07 (18500-1500)                               17000 Add:- Advance in 2005-06                4000      51000

                                                           Balance sheet                                                                                                                             As on 31st March 20007

LiabilitiesAmountAssetsAmount
Subscription in advance5000Subscription outstanding 2005-06                    1500                                        2006-07                   17000  18500

Question.. From the following particulars of a club, calculate the amount of salaries to be shown in Income and expenditure account for the year ended 31 March, 2008:-
Total salaries paid during the year 2007-08    Rs. 87,000
Outstanding salaries on 01-04-2007               Rs. 17,000
Prepaid salaries on 01-04-2007                                   Rs. 19,000
Outstanding salaries on 31-03-2008               Rs. 32,000
Prepaid salaries on 31-03-2008                                   Rs 20,000 
Ans. Calculation of salaries to be shown in Income and Expenditure A/C for the year ended March 31, 2008:-
                                                                                                                 Rs.
Total Salaries paid during the year                                                     87,000
Add:-
             Outstanding salaries on 31-03-2008               32,000
            Prepaid salaries on 01-04-2007                       19,000             51,000
                                                                                                       138,000

Less:-    Outstanding Salaries on 01-04-2007                17,000
             Prepaid salaries on 31-03-2008                        2,000           (37,000)
Salaries to be shown in Income and Expenditure A/C                          101000

Question. Calculate the amount to be debited to Income and Expenditure account under the heading sports items for the year 2006-07 in respect of the Osmosis club:- 

  Stock of sports items on 01-04-2006              Rs. 44,700
  Stock of sports items on 31-03-2007              Rs. 24,500
  Paid for sports items during the year              Rs. 97,900

Creditors for supplies of sports items 31-03-2007 Rs. 26,500.
Ans.
        Amount paid for sports items during the year                                    97900
       Add:-
                 Stock of sports items as on 01-04-2006          44700
                 Creditors for sports as on 31-03-2007             26500              71200
                                                                                                            169100                                                                                                                                
Less :-
            Stock of sports items as on 31-03-2007                            24500
Sports items to be debited in the Income and expenditure A/C        144600 

Question. Show the following information in the Balance Sheet of the Cosmos club as on 31st March 2007:- 

ParticularsDr (Rs)Cr (Rs)
Tournament Fund1,50,000
Tournament Fund Investment1,50,000
Income From Tournament Fund Investment  –  18,000
Tournament Expenses12,000

Additional Information:-
                                              Interest accrued on Tournament Fund Investment Rs. 6000. 
Ans.                                                Balance sheet of Cosmos Ltd.
                                                              As on 31st March, 2007

LiabilitiesAmountAssetsAmount
Tournament Fund                               1,50000   Add Income from Tournament Fund Investment                                    18,000   Accured interest on tournament fund Investment                                       6000                                                            1,74,000 Less Tournament Expenses                   12,000                    162000Tournament Fund investment.   Accured interest on Tournament fund Investment  1,50000           6000

Question. Calculate the amount medicines to be debited in the Income and Expenditure Account of a Hospital on the basis of the following information:- 

01-04-2006 Rs.31-03-2007 Rs.
Stock of Medicines90,0001,24,000
Creditors for Medicines2,40,000  2,04,000

Amount paid for medicines during the year was Rs. 6,79000.
Ans. Amount paid for medicine during the year                                      6,79000
     Add:-
               Stock of medicine on 01-04-2006                  90,000        
               Creditors for medicine on 31-03-2007            204,000           294,000
                                                                                                        9,73,000
Less:-
            Stock of medicine on 31-03-2007                  124,000
            Creditors for medicine as on 01-04-2006       240,000                364,000
                  Medicine to be debited in in Income and Expenditure A/C.     609000

Question. Distinguish between Receipts and Payments A/C and Income and expenditure A/C.
Ans. Difference between Receipts and Payments and Income and Expenditure. 

BasisIncome and ExpenditureReceipts and Payments
(i) NatureIt is a kin to profit and loss A/CIt is the summary of Cash book.  
(ii) Nature of ItemsIt records income and expenditure of revenue nature onlyIt records receipts and payments of both capital and revenue nature.
(iii) ResultThe result of Income and expenditure A/C is surplus or deficit.The result of Receipt and Payments is closing balance of cash and Bank.
Accounting For Not For Profit Organisation Class 12 Accountancy Exam Questions

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