{"id":2284,"date":"2023-10-02T11:55:48","date_gmt":"2023-10-02T11:55:48","guid":{"rendered":"http:\/\/localhost\/ecole9ja\/?p=2284"},"modified":"2023-10-02T11:56:20","modified_gmt":"2023-10-02T11:56:20","slug":"week-7-8-9-and-10-ss1-second-term-financial-accounting-notes","status":"publish","type":"post","link":"https:\/\/ecolebooks.com\/nigeria\/posts\/week-7-8-9-and-10-ss1-second-term-financial-accounting-notes\/","title":{"rendered":"Week 7, 8, 9 and 10 &#8211; SS1 Second Term Financial Accounting Notes"},"content":{"rendered":"<p><strong>WEEK SEVEN \u2013 TEN<br \/>\n<\/strong><strong>ACCOUNTS FOR NOT-FOR-PROFIT ORGANIZATIONS<br \/>\n<\/strong><strong>LEARNING OBJECTIVES<br \/>\n<\/strong><br \/>\n\u00a0<strong>At the end of this topic, the students should be able to:<br \/>\n<\/strong><\/p>\n<ul>\n<li>\n<div>Distinguish between the final accounts of the organizations that are not-for-profit and those that are profit-oriented.\n<\/div>\n<\/li>\n<li>\n<div>Define receipts and payments account and income and expenditure account as well as show the differences between the two forms of accounts.\n<\/div>\n<\/li>\n<li>\n<div>Prepare the following accounts:\n<\/div>\n<ul>\n<li>Receipts and payments accounts\n<\/li>\n<li>Income and expenditure accounts\n<\/li>\n<li>Subscription accounts\n<\/li>\n<li>Accumulated fund.\n<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n<p><strong>Introduction<br \/>\n<\/strong>There are several organizations that are established and run for the purposes of meeting the social, cultural, health and , at times, educational needs of the citizens. Such organizations are not set-up for the purpose of making profits from their activities and are thus called not-for-profit organizations. Examples include government-owned hospitals, voluntary health and welfare organizations, social clubs and organizations, religious bodies and so on.<br \/>\nThese organizations even though are not for profit-making, but need to prepare accounts so as to be able to tell their stakeholders and other donors how they have utilized the contributed funds.<br \/>\nThe legal status of such organizations is usually well defined in club (or association) rules and regulations. It is important that external financial information provided by such organization must conform to the generally accepted account principles.<br \/>\nUsually, the accounts of non-for-profit organizations consist of the following:<\/p>\n<ul>\n<li>\n<div>Receipts and payments account\n<\/div>\n<\/li>\n<li>\n<div>Income and expenditure account\n<\/div>\n<\/li>\n<li>\n<div>Balance sheet\n<\/div>\n<\/li>\n<\/ul>\n<p><strong>Receipts and Payments Account<br \/>\n<\/strong>The receipts and payments account is a summarized cash book (i.e. it incorporates the cash and bank transactions of a non-profit organization).<br \/>\nIn other words, it is a statement of cash actually received and paid during a given period. It commences with the opening balance of either cash in hand or at the bank. It is debited with all sums of money actually received and credited with all cash paid during the period.<br \/>\nThe receipts and payments account include all cash paid or received in a period, whether they relate to capital or revenue items and whether or not they belong to the period when the transactions occur. The final balance of cash in hand and the credit or debit balance at the bank at the end of the period.<br \/>\n<strong>Format of Receipts and Payments Account<br \/>\n<\/strong><strong>Hypothetical Example of Receipts and Payments Account for the year Ended\u2026<br \/>\n<\/strong><\/p>\n<div>\n<table>\n<tbody>\n<tr>\n<td><strong>Receipts<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<td><strong>Payment<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<\/tr>\n<tr>\n<td>Opening balance at the beginning of the period<\/td>\n<td>x<\/td>\n<td>Purchase of fixed assets<\/td>\n<td>x<\/td>\n<\/tr>\n<tr>\n<td>Donation<\/td>\n<td>x<\/td>\n<td>Management expenses<\/td>\n<td>x<\/td>\n<\/tr>\n<tr>\n<td>Membership subscription<\/td>\n<td>x<\/td>\n<td>Stationeries<\/td>\n<td>x<\/td>\n<\/tr>\n<tr>\n<td>Sundry income<\/td>\n<td>x<\/td>\n<td>Utilities (e.g. electricity, water rates etc.)<\/td>\n<td>x<\/td>\n<\/tr>\n<tr>\n<td>Sales of fixed assets<\/td>\n<td>x<\/td>\n<td>\u00a0<\/td>\n<td>\u00a0<\/td>\n<\/tr>\n<tr>\n<td>Income from club&#8217;s activities<\/td>\n<td>x<\/td>\n<td>Balance at the end of period<\/td>\n<td>x<\/td>\n<\/tr>\n<tr>\n<td>\u00a0<\/td>\n<td>xxx<\/td>\n<td>\u00a0<\/td>\n<td>xx<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<p><strong>Note: <\/strong>The opening balance represents the cash balance either in hand or at bank for the period, while other items appearing on the debit side of the account are sources of revenue to the club or associations.<br \/>\nThe items appearing on the credit side represent items on which cash were expended during the period. They include capital and revenue items. The list of items appearing on both sides are, however, not exhaustive as there could be other items that can appear on either side depending on the activities being carried out by the club.<\/p>\n<p>\u00a0<strong>Income and Expenditure Account<br \/>\n<\/strong>The income and expenditure account represents the profit and loss account of a non-profit-making organization. It contains only revenue items. It is debited with all expenditure incurred which are of revenue in nature, and credited with all incomes of a period whether or not they have actually been paid or received in the period.<br \/>\nThe final balance of an income and expenditure account represents the excess of income over expenditure or the excess of expenditure over income as the case may be for any particular period. Thus, the final balance is similar to the net profit (i.e. excess of income over expenditure) or net loss (i.e. excess of expenditure over income) or a trading organization. It is important to pint out to the students that:<\/p>\n<ul>\n<li>\n<div>The receipts and payments account and the income and expenditure account are used by non-profit-making organizations to present their financial position to their members and other stakeholders.\n<\/div>\n<\/li>\n<li>\n<div>The two accounts are different from each other in forms and contents.\n<\/div>\n<\/li>\n<\/ul>\n<p>Difference between receipts and payments account and income and expenditure account are as follows:<\/p>\n<div>\n<table>\n<tbody>\n<tr>\n<td><strong>Receipts and payment account<\/strong><\/td>\n<td><strong>Income and expenditure account<\/strong><\/td>\n<\/tr>\n<tr>\n<td>Contains opening balance which will represent the amount of cash in hand or at the bank in the beginning of the year.<\/td>\n<td>It has no such item as it records only cash spent.\n<\/td>\n<\/tr>\n<tr>\n<td>It is used to record cash transactions only.<\/td>\n<td>It records cash transactions and also includes accrued transactions (i.e. it is prepared on &#8216;accrual basis&#8217;).<\/td>\n<\/tr>\n<tr>\n<td>It records and includes capital receipts (i.e. cash from sale of fixed asset) and capital payments (i.e. cash spent to purchase fixed asset).<\/td>\n<td>All inflows (incomes) are credited while all outflows (expenditure) are debited into this account.<\/td>\n<\/tr>\n<tr>\n<td>The balance in this account at the end of the period (year) represents cash in hand, cash at bank or bank overdraft as the case may be.<\/td>\n<td>The balance in this account will represent surplus (i.e. when income is more than expenditure) or deficit (i.e. when the expenditure is more than income) in any period (year).<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<p>\u00a0<strong>Membership Subscription<br \/>\n<\/strong>Clubs, societies and association receive payments from members for benefits which members enjoy in the form of subscriptions usually on an annual basis. Membership subscription is one important source of income to clubs and\/or associations. It is usually payable one year in advance. Such payments in advance by members are shown as liability in the balance sheet of clubs; this because the year&#8217;s membership still has to run as at the balance sheet date.<br \/>\nHowever, in practice, a large number of members will never pay their subscription at the appropriate time and will be owing the club, making a substantial amount of subscriptions to be in arrears. As it mostly happens, these subscriptions are never received by the clubs or association.<br \/>\nThe treatment of subscriptions in arrears poses a problem in the preparation of clubs&#8217; account as decision has to be made whether to show subscriptions in arrears as debtors in the balance sheet or not, as the balance sheet could be distorted by a fictitious asset of debtors; where subscription in arrears are recognized and included in the balance sheet and are never paid by affected members.<br \/>\nThe points to note are as follows:<\/p>\n<ul>\n<li>\n<div>Recognizing subscriptions in arrears and treating them as debtors (assets) in the balance sheet is inappropriate due to the application of the accrual concept. It is recognized that subscriptions in arrears are incomes that have been earned for a particular accounting years, but for which cash has not been received.\n<\/div>\n<\/li>\n<li>\n<div>On the other hand, excluding subscription in arrears from the balance sheet is the application of prudence concept. The exclusion is due to the fact that subscriptions that are owed by the members for a long time end up not being paid eventually.\n<\/div>\n<\/li>\n<\/ul>\n<p>Irrespective of the method adopted, treatment of subscriptions in arrears by a club in the balance sheet should be applied on a consistent basis and changes made where the club or association conditions justify the change<br \/>\n<strong>Illustration 1<br \/>\n<\/strong>The Barca fans club had the following transactions in their subscription account for the year ended 31 December, 2008.<br \/>\n(a)  Cash received for subscription N290,000<br \/>\n(b) Subscription owing by member as at 31 December 2007 amounted to N40,000<br \/>\n(c)\u00a0\u00a0\u00a0\u00a0Subscription owing by members as at 31 December, 2008 was N60,000<br \/>\n(d)\u00a0\u00a0\u00a0\u00a0Subscription paid in advanced by members for 2008 amounted N10,750, while subscription in advance for 2009 was N54,500.<br \/>\nYou are required to prepare the subscriptions account as it would be at the end of 31 December 2006.<br \/>\n<strong>Solution<br \/>\n<\/strong><strong>Subscriptions Account for the Year Ended 2008<br \/>\n<\/strong><\/p>\n<div>\n<table>\n<tbody>\n<tr>\n<td><strong>Particulars<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<td><strong>Particulars<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<\/tr>\n<tr>\n<td>Subscriptions owing at 01\/01\/2008<\/p>\n<p>\u00a0Amount transferred to<br \/>\nincome and expenditure<br \/>\naccount as income for<br \/>\nthe year<\/p>\n<p>\u00a0Subscription paid in<br \/>\nadvance for 2009<\/td>\n<td>40,000<\/p>\n<p>\u00a0<br \/>\n\u00a0<br \/>\n\u00a0266,250<\/p>\n<p>\u00a0<br \/>\n\u00a0<br \/>\n\u00a0  54,500<br \/>\n<img decoding=\"async\" align=\"left\" src=\"https:\/\/ecolebooks.com\/nigeria\/wp-content\/uploads\/9jalessonsimages\/100223_1155_Week789an1.png\" alt=\"\"\/><br \/>\n\t\t\t\t\t\t\t360,750<\/td>\n<td>Subscription paid in<br \/>\nAdvance at 01\/01\/2008<\/p>\n<p>\u00a0Cash received from<br \/>\nmembers for subscription<br \/>\npayment in 2008 <\/p>\n<p>\u00a0<br \/>\n\u00a0subscription owning at<br \/>\n31\/12\/2008<\/td>\n<td>10,750<\/p>\n<p>\u00a0<br \/>\n\u00a0<br \/>\n\u00a0290,000<\/p>\n<p>\u00a0<br \/>\n\u00a0<br \/>\n\u00a0  60,000<br \/>\n<img decoding=\"async\" align=\"left\" src=\"https:\/\/ecolebooks.com\/nigeria\/wp-content\/uploads\/9jalessonsimages\/100223_1155_Week789an2.png\" alt=\"\"\/><br \/>\n\t\t\t\t\t\t\t360,750\n\t\t\t\t\t\t\t<\/td>\n<\/tr>\n<tr>\n<td>\u00a0<\/td>\n<td>\u00a0<\/td>\n<td>Subscription paid in<br \/>\nAdvance b\/d <\/td>\n<td>\n\u00a054,500<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<p>i<br \/>\nThe carrying forward subscription in advance means the application of matching concept. In the illustration, the payment of N54,500 included in the amount received for subscription for 2009 represents income meant for 2009 accounting year. This must be removed from the current year&#8217;s payment of cash received for subscription in the year. Hence, the debit carry forward of the amount of N54,500 on the subscription account. This will be shown in the balance sheet as a liability.<\/p>\n<p>\u00a0<strong>Life Membership<br \/>\n<\/strong>At times, subscriptions are received from life members pay a once-and-for-all subscription which entitles them to use of club facilities for the rest of their lives. This once-and-for-all payment from life members are not income relating to the year in which they are received by the club, because the payment is for the life of the members which can last a very long time to come.<br \/>\nIn practice, if life membership subscriptions are small, they are credited to income account as received, but if they are significant in amount, they should be credited in equal proportion over the estimated active club membership of such members.<\/p>\n<p>\u00a0<strong>Accumulated Fund<br \/>\n<\/strong>The accumulated fund represents the opening capital of a non-profit-making organization. It has the same meaning with the capital account of a sole trader and partnership.<br \/>\nIt is calculated as the difference between total assets and liabilities in a particular period. In situation where a club keeps an incomplete records or single entry, the accumulated fund is derived through preparation of statement of affairs.<br \/>\n<strong>Illustration 2<br \/>\n<\/strong>The Swagger Youth Club prepared the following information relating to the club activities for the year ended 31 December 2009.<\/p>\n<div>\n<table>\n<tbody>\n<tr>\n<td>\u00a0<\/td>\n<td>N<\/td>\n<td>N<\/td>\n<\/tr>\n<tr>\n<td>Cash in hand<br \/>\nSubscription:   2008<br \/>\n                        2009<br \/>\nReceipts for use of club facilities<br \/>\nReceipts from refreshing guests<br \/>\nPayments:<br \/>\nRepairs<br \/>\nSalaries and wages<br \/>\nPrinting and stationeries<br \/>\nRefreshment materials<br \/>\nElectricity expenses<br \/>\nVehicle running expenses<br \/>\nCaretaker wages<br \/>\nCreditors for repairs<br \/>\nCreditors for vehicle expenses<br \/>\nCreditors for refreshment materials<br \/>\nSubscription owning for 2009<\/td>\n<td>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0120,000<br \/>\n500,000<br \/>\n        80,000<br \/>\n        58,000<br \/>\n        18,000<br \/>\n        11,000<br \/>\n          3,000<br \/>\n          2,000<br \/>\n             400<br \/>\n          3,000<br \/>\n        50,000<\/td>\n<td>900,000<br \/>\n  1,000,000<br \/>\n  4,500,000<br \/>\n  1,000,000<br \/>\n     100,000<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<p>\u00a0You are required to prepare:<\/p>\n<ol>\n<li>\n<div>Receipts and payments account\n<\/div>\n<\/li>\n<\/ol>\n<ol>\n<li>\n<div>Income and expenditure account for the year ended 31 December 2009.\n<\/div>\n<\/li>\n<\/ol>\n<p>\u00a0<strong>Bar Trading Account<br \/>\n<\/strong>As part of the activities to partly provide relaxation and enjoyable moments for members and to partly generate additional income for effectiveness running of a club, a club may engage in running a bar alongside other activities which can generate profit. The profit will not be distributed among members, but rather used for the purpose of the club.<br \/>\nThus, if a club has a bar, a separate trading and profit and loss account will be prepared for its trading activities. The net profit arising from the bar activities is then included as income in the income and expenditure account, and may loss from the bar trading is included in the expenditure side of the income and expenditure account.<\/p>\n<p>\u00a0<br \/>\n\u00a0<strong>Illustration 3<br \/>\n<\/strong>The Financial Secretary of chop-1-chop Fun Club presented you with the following summary of receipts and payments account of the club for the year ended 31 December, 2007.<br \/>\n<strong>Receipts and Payments Account for the Year Ended 31 December 2007<br \/>\n<\/strong><\/p>\n<div>\n<table>\n<tbody>\n<tr>\n<td><strong>Receipts<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<td><strong>Payments<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<\/tr>\n<tr>\n<td>Bal. b\/f<br \/>\nMembership subscription<br \/>\nEntrance fees<br \/>\nBar receipts<br \/>\nSundry receipts<\/td>\n<td>49,000<br \/>\n57,600<br \/>\n   8,400<br \/>\n 75,000<br \/>\n 38,000<\/p>\n<p>\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<img decoding=\"async\" align=\"left\" src=\"https:\/\/ecolebooks.com\/nigeria\/wp-content\/uploads\/9jalessonsimages\/100223_1155_Week789an3.png\" alt=\"\"\/>228,000<\/td>\n<td>Rent and rates<br \/>\nBar purchases<br \/>\nGeneral wages<br \/>\nBar wages<br \/>\nSocial activities<br \/>\nExpenses<br \/>\nEquipment<br \/>\nElectricity expenses<br \/>\nPostage<br \/>\nBank charges<br \/>\nInsurance<br \/>\nBal. c\/f<\/td>\n<td>      8,040<br \/>\n35,800<br \/>\n25,600<br \/>\n11,040<\/p>\n<p>\u00a030,000<br \/>\n57,200<br \/>\n      2,080<br \/>\n      3,520<br \/>\n      1,160<br \/>\n      6,040<br \/>\n47,520<br \/>\n<img decoding=\"async\" align=\"left\" src=\"https:\/\/ecolebooks.com\/nigeria\/wp-content\/uploads\/9jalessonsimages\/100223_1155_Week789an4.png\" alt=\"\"\/>228,000<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<p>\u00a0<br \/>\n\u00a0Other additional information includes the following balances:<\/p>\n<div>\n<table>\n<tbody>\n<tr>\n<td>\u00a0<\/td>\n<td>31\/12\/2016<\/td>\n<td>31\/12\/2007<\/td>\n<\/tr>\n<tr>\n<td>\n<ol>\n<li>\n<div>Furniture and fittings\n<\/div>\n<\/li>\n<li>\n<div>Premises\n<\/div>\n<\/li>\n<li>\n<div>Bar stocks\n<\/div>\n<\/li>\n<li>\n<div>Subscription in arrears\n<\/div>\n<\/li>\n<li>\n<div>Wages owning\n<\/div>\n<\/li>\n<li>\n<div>Subscription in advance\n<\/div>\n<\/li>\n<li>\n<div>Insurance prepaid<\/div>\n<\/li>\n<\/ol>\n<\/td>\n<td>        44,000<br \/>\n      600,000<br \/>\n        10,400<br \/>\n             800<br \/>\n          1,800<br \/>\n          4,000<br \/>\n          1,360<\/td>\n<td>28,400<br \/>\n    600,000<br \/>\n      14,200<br \/>\n        1,200<\/p>\n<p>\u00a0<br \/>\n\u00a0       1,800<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<p>\u00a0Depreciation to be provided on equipment at 20%<br \/>\nYou are required to prepare:<\/p>\n<ol>\n<li>\n<div>Bar trading accounts\n<\/div>\n<\/li>\n<\/ol>\n<ol>\n<li>\n<div>Income and expenditure account for the year ended 31 December 2007\n<\/div>\n<\/li>\n<li>\n<div>Balance sheet as at that date.\n<\/div>\n<\/li>\n<\/ol>\n<p>\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<strong>Solution<br \/>\n<\/strong><strong>Bar Trading Account for the Year Ended 31 December 2007<br \/>\n<\/strong><\/p>\n<div>\n<table>\n<tbody>\n<tr>\n<td><strong>Particulars<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<\/tr>\n<tr>\n<td>Sales<br \/>\nOpening stock bar<br \/>\nAdd: Bar purchases<\/p>\n<p>\u00a0Less: Closing stock of bar<\/p>\n<p>\u00a0Add bar wages<br \/>\nBar profit transfer to income and exp. Account<\/td>\n<td>\n\u00a010,400<br \/>\n35,800<br \/>\n46,200<br \/>\n14,200<\/p>\n<p>\u00a032,000<br \/>\n11,040<\/p>\n<p>\t\t\t\t\t\t\t\u00a0<\/td>\n<td>75,000<\/p>\n<p>\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0(43,040)<br \/>\n31,960\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<p>\u00a0<strong>Income and Expenditure Account for the Year Ended 31 December 2007<br \/>\n<\/strong><\/p>\n<div>\n<table>\n<tbody>\n<tr>\n<td><strong>Expenditure<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<td><strong>Income<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<\/tr>\n<tr>\n<td>Rent &amp; rated<br \/>\nGeneral wages (25,600 \u2013 1,800)<br \/>\nSocial activities expenses<br \/>\nPostage<br \/>\nElectricity expenses<br \/>\nInsurance<br \/>\nBank charges<br \/>\nFurniture &amp; fixture<br \/>\n(44,000 \u2013 28,400)<br \/>\nEquipment (20    x 57,200)<br \/>\n                      100<br \/>\nExcess of income over<br \/>\nExpenditure\n<\/td>\n<td>     8,040<br \/>\n   23,800<br \/>\n   30,000<br \/>\n    3,520<br \/>\n    2,080<br \/>\n     5600<br \/>\n    1,160<br \/>\n  15,600<\/p>\n<p>\u00a0  11,440<\/p>\n<p>\u00a0<br \/>\n\u00a0  39,120<br \/>\n<img decoding=\"async\" align=\"left\" src=\"https:\/\/ecolebooks.com\/nigeria\/wp-content\/uploads\/9jalessonsimages\/100223_1155_Week789an5.png\" alt=\"\"\/>140,360<\/td>\n<td>Membership subscription<br \/>\nEntrance fees<br \/>\nBar profits<br \/>\nOther income\n<\/td>\n<td>  62,000<br \/>\n   8,400<br \/>\n31,000<br \/>\n38,000<\/p>\n<p>\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<img decoding=\"async\" align=\"left\" src=\"https:\/\/ecolebooks.com\/nigeria\/wp-content\/uploads\/9jalessonsimages\/100223_1155_Week789an6.png\" alt=\"\"\/>140,360<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<p>\u00a0<strong>Chop-1-chop Fun Club<br \/>\n<\/strong><strong>Calculation of Accumulated Fund as at 1 January 2007<br \/>\n<\/strong><\/p>\n<div>\n<table>\n<tbody>\n<tr>\n<td><strong>Assets<\/strong><\/td>\n<td>\u00a0<\/td>\n<td><strong>N<\/strong><\/td>\n<\/tr>\n<tr>\n<td>Premises<br \/>\nFurniture and fittings<br \/>\nBar stock<br \/>\nInsurance prepaid<br \/>\nSubscription in arrears<br \/>\nBank balance<br \/>\nLiabilities<br \/>\nWages owing<br \/>\nSubscription in advance<\/td>\n<td>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a01,800<br \/>\n4,000<\/p>\n<p>\t\t\t\t\t\t\t\u00a0<\/td>\n<td>600,000<\/p>\n<p>\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0(5,800)<\/p>\n<p>\u00a031,960<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<p>\u00a0This calculation of the accumulated fund is done in order to derive total opening capital of the club as the beginning of the year. Thus, the addition of the total assets of the club at the beginning of the year from which we deduct the total liabilities of the club again at the beginning of the year give us the accumulated fund.<br \/>\n<strong>Balance Sheet as at 31 December 2007<br \/>\n<\/strong><\/p>\n<div>\n<table>\n<tbody>\n<tr>\n<td><strong>Particulars<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<\/tr>\n<tr>\n<td><strong>Fixed Assets<br \/>\n<\/strong>Premises<br \/>\nFurniture and fittings<br \/>\n<strong>Less:<\/strong> depreciation<br \/>\nEquipment<br \/>\n<strong>Less:<\/strong> depreciation<\/p>\n<p>\u00a0<strong>Current Assets<br \/>\n<\/strong>Bar stock<br \/>\nSubscription in arrears<br \/>\nInsurance prepaid<br \/>\nBank <\/p>\n<p>\u00a0<br \/>\n\u00a0<br \/>\n\u00a0Represented by<br \/>\nAccumulated fund<br \/>\nAdd: excess of income over<br \/>\n          expenditure<\/td>\n<td>\n\u00a0<br \/>\n\u00a044,000<br \/>\n(15,600)<br \/>\n57,200<br \/>\n(11,440)<\/p>\n<p>\u00a0<br \/>\n\u00a014,200<br \/>\n1,200<br \/>\n1,800<br \/>\n47,520<\/p>\n<p>\t\t\t\t\t\t\t\u00a0<\/td>\n<td>\n\u00a0600,000<\/p>\n<p>\u00a028,400<\/p>\n<p>\u00a045,760<br \/>\n674,160<\/p>\n<p>\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a064,720<br \/>\n738,880<\/p>\n<p>\u00a0699,760<br \/>\n39,120<br \/>\n738,880<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<p>\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<br \/>\n\u00a0<strong>Workings<br \/>\n<\/strong><strong>Subscription Account<br \/>\n<\/strong>Dr\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Cr<\/p>\n<div>\n<table>\n<tbody>\n<tr>\n<td><strong>Particulars<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<td><strong>Particulars<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<\/tr>\n<tr>\n<td>Bal. b\/f<\/p>\n<p>\u00a0Income and<br \/>\nExpenditure<\/p>\n<p>\u00a0<br \/>\n\u00a0<br \/>\n\u00a0Bal. b\/f<\/td>\n<td>     800<\/p>\n<p>\u00a062,000   <\/p>\n<p>\u00a0<br \/>\n\u00a0<br \/>\n\u00a062,800<br \/>\n1,200<\/td>\n<td>Bal. b\/f<\/p>\n<p>\u00a0Receipts and<br \/>\nPayment<\/p>\n<p>\u00a0Bal. c\/f\n<\/td>\n<td>4,000<\/p>\n<p>\u00a0  57,600<\/p>\n<p>\u00a0<br \/>\n\u00a01,200<br \/>\n62,800<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<p><strong>Insurance Account<br \/>\n<\/strong>Dr\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0Cr<\/p>\n<div>\n<table>\n<tbody>\n<tr>\n<td><strong>Particulars<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<td><strong>Particulars<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<\/tr>\n<tr>\n<td>Bal. b\/f<\/p>\n<p>\u00a0Receipt and<br \/>\npayment a\/c\n<\/td>\n<td>  800<\/p>\n<p>\u00a0<br \/>\n\u00a06,040<br \/>\n\t\t\t\t\t\t\t\t7,400<\/td>\n<td>Income and<br \/>\nexpenditure a\/c<\/p>\n<p>\u00a0Bal. c\/f\n<\/td>\n<td>5,600<\/p>\n<p>\u00a0<br \/>\n\u00a01,800<br \/>\n7,400<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<p><strong>Use the Data Below to Answer Questions 1 to 5:<br \/>\n<\/strong><strong>Receipts and payments account for the year ended 31 December 2008<br \/>\n<\/strong><\/p>\n<div>\n<table>\n<tbody>\n<tr>\n<td><strong>Receipts<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<td><strong>Payments<\/strong><\/td>\n<td><strong>N<\/strong><\/td>\n<\/tr>\n<tr>\n<td>Bal. b\/f<br \/>\nSubscriptions<br \/>\nReceipt and<br \/>\npayment a\/c<\/p>\n<p>\t\t\t\t\t\t\t\u00a0<\/td>\n<td>  16,000<\/p>\n<p>\u00a0<br \/>\n\u00a06,040   <\/p>\n<p>\u00a07,400<\/td>\n<td>Equipment<br \/>\nBar purchases\n<\/td>\n<td>18,000<br \/>\n60,000<\/p>\n<p>\u00a01,800<\/p>\n<p>\u00a07,400<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<p>\u00a0<br \/>\n\t\t\u00a0<\/p>\n","protected":false},"excerpt":{"rendered":"<p>WEEK SEVEN \u2013 TEN ACCOUNTS FOR NOT-FOR-PROFIT ORGANIZATIONS LEARNING OBJECTIVES \u00a0At the end of this&#8230;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1,194],"tags":[],"class_list":["post-2284","post","type-post","status-publish","format-standard","hentry","category-posts","category-second-term-ss1-accounting"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/posts\/2284","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/comments?post=2284"}],"version-history":[{"count":1,"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/posts\/2284\/revisions"}],"predecessor-version":[{"id":2285,"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/posts\/2284\/revisions\/2285"}],"wp:attachment":[{"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/media?parent=2284"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/categories?post=2284"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ecolebooks.com\/nigeria\/wp-json\/wp\/v2\/tags?post=2284"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}