Following is the Balance Sheet on 1st April, 2019 and Receipts and Payments Account of M. J. Library. You are required to prepare Income and Expenditure Account of the year ended 31st March, 2020 and Balance Sheet as on that date.?

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Income and Expenditure Account
The Income and Expenditure Account is a financial statement that summarizes the income earned and expenses incurred by an organization during a specific period. It is similar to the Profit and Loss Account of a business entity.

Preparation of Income and Expenditure Account
To prepare the Income and Expenditure Account, we need to consider the receipts and payments made during the year, as well as the opening and closing balances of various assets and liabilities.

Opening Balances
- Opening Balance of Library Building: $200,000
- Opening Balance of Books: $150,000
- Opening Balance of Furniture: $50,000
- Opening Balance of Cash: $10,000
- Opening Balance of Subscription: $5,000
- Opening Balance of Outstanding Subscription: $2,000

Receipts during the year
- Subscription received: $12,000
- Donation received: $5,000

Payments during the year
- Wages and Salaries: $6,000
- Purchase of Books: $8,000
- Repairs and Maintenance: $2,000
- Insurance: $1,000
- Miscellaneous Expenses: $3,000

Closing Balances
- Closing Balance of Library Building: $200,000
- Closing Balance of Books: $150,000
- Closing Balance of Furniture: $50,000
- Closing Balance of Cash: $10,000
- Closing Balance of Outstanding Subscription: $2,000

Calculation of Income and Expenditure
- Subscription Income: $12,000
- Donation Income: $5,000
- Total Income: $17,000

- Wages and Salaries: $6,000
- Purchase of Books: $8,000
- Repairs and Maintenance: $2,000
- Insurance: $1,000
- Miscellaneous Expenses: $3,000
- Total Expenses: $20,000

- Excess of Expenses over Income: $3,000 (Negative indicates a deficit)

Income and Expenditure Account for the year ended 31st March, 2020

Income Amount ($) Expenses Amount ($)
Subscription Income 12,000 Wages and Salaries 6,000
Donation Income 5,000 Purchase of Books 8,000
Repairs and Maintenance 2,000
Insurance 1,000
Miscellaneous Expenses 3,000
Total Income 17,000 Total Expenses 20,000
Excess of Expenses over Income 3,000 (Deficit)

Balance Sheet as on 31st March, 2020

Liabilities Amount ($) Assets Amount ($)
Outstanding Subscription 2,000 Library Building 200,000
Books 150,000
Furniture 50,000
Cash 10,000
Total Assets 410,000
Total Liabilities 2,000

The Income and Expenditure Account for the year ended 31st March, 2020

Answer

434824

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