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CBSE Class 12-commerce Answered

In Not for profit organisation subscription for last year (31st March 2018) why we will not substravt it in calculation of current year subscription for income and expenditure a/c
Asked by Smitakhadayate20 | 19 Jun, 2019, 05:13: PM
answered-by-expert Expert Answer

Subscriptions:

  • It is a source of income for an NPO.
  • It is paid by the members periodically which can be quarterly or half yearly so that their membership remains alive.
  • The total amount of subscription relating to the current year, whether received or not are to be shown on the credit side of the Income and Expenditure Account.
  • Amount relating to the current year, not received till the end of the year is to be shown as an asset in the Balance Sheet as outstanding income.
  • Amount received in advance for future years is also shown as a liability in the Balance Sheet as advance income.

Format of the table showing calculation of Subscriptions to be shown Income and Expenditure Account is as follows:

Particulars

Amount

Subscription received during year as shown in Receipts and Payments Account

Add: Outstanding at the end of the year                                                                              

         Received in advance in the beginning of the year                                                        

 Less: Outstanding at the beginning of the year                                                                    

          Received in advance at the end of the year                                                                

  

  

 

  

Subscriptions to be shown in the Income and Expenditure A/c 

 

Answered by Surabhi Gawade | 19 Jun, 2019, 05:56: PM

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