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A Level WS-4

The document provides financial information for two non-profit organizations: 1) The Glades Social Club for the year ended June 30, 2014, including assets, receipts, payments, and additional financial details. 2) The Sunshine Social Club for the year ended December 31, 2020, including life membership fees, receipts and payments, donations, equipment sales, depreciation policies, and selected account balances. Financial questions are asked about calculating funds, differences between accounts, accounting treatments, and preparing income statements and statements of financial position.

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Ruchira Sanket Kale
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247 views4 pages

A Level WS-4

The document provides financial information for two non-profit organizations: 1) The Glades Social Club for the year ended June 30, 2014, including assets, receipts, payments, and additional financial details. 2) The Sunshine Social Club for the year ended December 31, 2020, including life membership fees, receipts and payments, donations, equipment sales, depreciation policies, and selected account balances. Financial questions are asked about calculating funds, differences between accounts, accounting treatments, and preparing income statements and statements of financial position.

Uploaded by

Ruchira Sanket Kale
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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Non profit organisations

Q. 1 The treasurer of the Glades Social Club is able to provide the following
information about the club’s most recent financial year which ended on 30th June
2014.
Assets and liabilities at 1st July 2013

Cash at bank 3840

Club buildings cost:


Cost 280000
Provision for depreciation 21000

Club furniture and equipment at 17500


valuation

Inventory: refreshments 870

Subscriptions due 650

Subscriptions received in advance 210

General expenses due 380

Life membership fund 14500

Receipts And Payments Account for the year ended 30th June 2014

Receipts $ Payments $

Balance at bank 3840 Purchase of 1750


1 July 2013 refreshments

Members’ 6750 General expenses 4440


subscriptions

Life membership 2250 Purchase of 6750


subscriptions furniture and
equipment

Loans from 600 Balance at bank 3290


members 30th June 2014

1
Non profit organisations
Donations 320

Sales of 2470
refreshments

16230 16230
Additional information:
❖ The loans from members are interest free but are to be repaid in January
2015.
❖ Suppliers of refreshments were owed $310 on 30 June 2014.
❖ General expenses were prepaid $60 on 30 June 2014.
❖ There was a refreshments inventory valued at $380 on 30 June 2014.
❖ Members’ subscriptions $480 were due on 30 June 2014.
❖ Members’ subscriptions $710 had been received in advance for the year
ended ending 30 June 2015
❖ The club buildings should be depreciated by 2.5% on cost.
❖ The treasurer valued the furniture and equipment at $20500 on 30 June 2014.
❖ The club’s policy is to regard 10% of the life membership fund as income for
the year under review.

Prepare:
a) A calculation of the club’s accumulated fund at 1 July 2013
b) A subscriptions account for the year ended 30 June 2014
c) A refreshments trading account for the year ended 30th June 2014
d) An income and expenditure account for the year ended 30th June 2014
e) A statement of financial position at 30th June 2014
[ Total : 25 ]

Q.2 Sunshine Social Club is a sports club and has a year-end of 31 December. The
club started admitting life members in 2015. It is the policy of the club that a life
membership fee is initially credited to a life membership fund and recognised in the
income and expenditure account over five years equally. Life membership fees
received in the previous five years were as follows:
$

2019 6500
2018 4000

2
Non profit organisations

2017 4500
2016 2000
2015 1000

Answer the following questions:


(a) Calculate the life membership fund shown in the statement of financial position at 31
December 2019. [3]

Additional information
The treasurer of the club has prepared the receipts and payments account for the year
ended 31 December 2020 as follows:

The special donation of $10000, received during 2020, is designated for the club’s
anniversary activities in 2022. The treasurer is unsure whether this amount should
be treated as income for the year ended 31 December 2020.

(b) State three differences between a receipts and payments account and an income
and expenditure account. [3]

(c) Explain to the treasurer, with reference to the appropriate accounting concepts,
the accounting treatment of the special donation of $10000 in the financial
statements of the club. [5]

Additional information:
1. During the year ended 31 December 2020, an item of fully depreciated club
equipment, which had an original cost of $8000, was sold for $2200.

3
Non profit organisations
2. It is the club’s policy to depreciate club equipment at an annual rate of 20%
using the reducing balance method. A full year’s depreciation is charged in
the year of acquisition.

3. Selected balances at 31 December 2020 and at 31 December 2019 were


extracted as follows:

(d) Prepare the income and expenditure account for the year ended 31 December
2020. [8]

Additional information
The chairman of the club decided to transfer $6000 from the accumulated fund to a
fund designated for the anniversary activities on 31 December 2020.

(e) (i) Calculate the accumulated fund at 31 December 2019. [3]

(ii) Prepare a statement showing the movement on the accumulated fund for the
year ended 31 December 2020. [3]

[Total: 25]

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