DEPARTMENT OF TECHNICAL EDUCATION

ANDHRA PRADESH
NAME : J. SATYANARAYANA RAO.
DESIGNATION : SENIOR LECTURER.
BRANCH : Commercial & Computer Practice
Institute : Govt. polytechnic for women, Guntur.
Year/Sem : III Sem
Subject : Accountancy –II
Sub. Code : CCP-302.
Topic : Non-Trading Concerns.
Duration : 50 Minutes.
Sub-Topic : Preparation of Current year’s Balance Sheet.
Teaching Aids : PPT, Animation.

CCP302.73 1
Objectives:

On completion of this period,

you would be able to prepare

Current year Balance Sheet of Non-Trading Concerns.

Recap:

 Just like trading concerns, the Non-trading

Concerns also prepare Balance Sheet.

 To know a firm’s/concern’s actual financial

position, it has to prepare Balance Sheet.
Recap contd.
 The Balance Sheet covers all those items , such as Assets,
Liabilities and Capital Fund
 Capital Fund:- Capital fund is similar to capital account of
trading concerns.
 Non-Trading concerns do not have formal Capital like that
of trading concerns.
 Excess of income over expenditure (Surplus), Capital
receipts or receipts that are accumulated under the heading
“Capital Fund” are treated as Capital Fund
 and shown on the Liabilities side of the Balance Sheet
Recap contd.
Important points:

2. If Receipts & Payments A/c is given , you have to prepare

Income & Expenditure A/c. Then only you can prepare Current
Year Balance Sheet.

3. Some times the previous year’s Balance sheet has to be prepared

for ascertaining the actual financial position, this helps to prepare
the current year’s Balance sheet.
Exercise: “Receipts and Payments A/c of
a Charitable Trust for the year 2000.

To Opening Balance: Rs. By capital Payments

Cash 1,000 Investments 10,000
Bank 15,000 Furniture 4,000
14,000 Clinical Equipment 5,000 19,000
To Capital Fund: 6,000 By Revenue Payments
Donation for Clinic Fund
Salaries 6,200
To To Revenue Receipts
Interest 30,000 Medicines 14,000
Rent 12,000 45,000
Scholarships 10,000
Sundries 3,000
Printing etc. 800
Traveling 1,000
32,000
To Balance c/d
Cash 1,600
Bank 13,400
15,000
66,000 66,000

CCP302.73
6
 Additional Information

 Trust Fund originally consisted of Buildings valued at Rs.

1,50,000., 9% Govt. Securities of the nominal value of
Rs.3,50,000 [cost Rs.3,20,000] and the Bank balance of
Rs.10,000.

 Bank interest receivable at the end of the year was Rs.2,500.

Interest accrued on investments on 1-1-1999. Rs.3,500 and
on 31.12.99 Rs.5,000. The trust owed suppliers of medicines
Rs.1,200 and Rs.800 respectively on 1.1.99 & 31.12.99.
Furniture on 1.1.99 stood at Rs.3,000 in the books
 You are required to prepare the final accounts of the
Trust for the year 2000 after providing 2 1/2%
depreciation on the book value of the buildings and at
20% on other assets
Solution for Example:1
Income & Expenditure A/C of Charitable Trust for the year 2000
To salaries 6200 By interest 31500

To medical and surgical 13600 By rent 1200

Expenses

To scholarships 10000 By sundry contribution 3000

To printing etc., 800 By interest accrued on bank 2500

deposits

To depreciation:
Bidgs @21/2% 3750
furniture@20% 1400
Clinical Equipments
@20% 1000 6150
To Excesss of income over 11250
expenditure taken to trust
fund 49000 49,000

CCP302.73 9
Balance Sheet of Charitable Trust as on 31-12-2000

Liabilities Amount Rs. Assets Amount RS

Trust capital fund Buildings 1,50,000

Balance 4,80,000 Less: Depn 3,750 1,46,250
Add: Donations 6,000 4,86,000
FURNITURE 7,000
Surplus 21,550
Less: depn 1,400 5,600

Creditors for supplies 8,00 Surgical Equipments

5,000 4,000
Less Depn.
1,000
Investments 3,30,000
Current assets
Accrued interest 7,500
Cash 1,600
Bank 13,400 22,500

5,08,350 22,500
5,08,350

CCP302.73 10
Assignment:
“Receipts and Payments A/c of an amusement club for the year 2000 for the year ending 31stDec200

Receipts Rs. Payments

Balance b/d: Salary of Secretary 3,600
Honorarium 450
Cash 60 3.060 Wages
Bank 3,000 2,400
Charities
2,000
Subscriptions (Including
Printing and Stationery
subscriptions for 2000 300
9,000
Rs.150) Postage
750 100
Sale of Old Furniture on Rent and Taxes
1,200
Jan.1, 2000 Upkeep of the Land
50 500
Sale of Newspapers Sports Materials
3,000 2,500
Legacies
Balance c/d
Interest on investments 14,850
(Cost of Investments 1,200
Rs.20,000) 10,000
Endowment Fund Receipts 800
Proceeds of Concerts
40
Advertisement in the
Year Book
27,900

27,900
 Additional Information
 Current assets and liabilities as on 31st December
1998 and 1999 were as follows:

31-12-1998 31-12-1999
Subscriptions in arrears 200 450
Subscriptions in advance 300 600
Furniture 2000 1,080
Depreciation was 10% p.a. on the furniture left after
selling a part of it. It was decided that half of the
legacies may be capitalized.
Prepare Income And Expenditure Account and the
balance sheet as on that date.
 Assignment Contd.

For practice Refer

1.Advanced Accountancy
 by R.L. Guptha and M. Radhaswamy
2.Accountancy
 by Dr. Sm. Shukla
 Solve problems from your text book and old question
papers.