Question

6. The following is the Receipt and Payment Account of Kayode Social Club for the year ended 31st December, 2014:
Receipts: Cash in hand 1/1/2014: 500; Cash at bank 1/1/2014: 1,000; Subscriptions: 2013: 1,200, 2014: 4,000, 2015: 2,300 (=7,500); Donations: 2,000; Transfer from deposit account: 3,000. Total: 29,000
Payments: Purchase of sport equipment: 1,800; Repairs: 1,500; Salaries: 1,700; Insurance: 1,000; Show expenses: 3,200; Transport expenses: 500; Secretarial expenses: 300; Purchase of furniture: 3,000; End of year show: 15,000; Balance c/d: 16,000. Total: 29,000
Additional information: (i) Equipment was valued at N3,250 and furniture N1,550 on 31st December, 2013. (ii) Depreciation to be provided as follows: Equipment N505; Furniture N55. (iii) The following expenses were outstanding: Salaries N300; Transport N100; Repairs N250. (iv) Subscriptions owing by members were as follows: for December, 2013 N1,200; for December, 2014 N2,100. (v) The balance in the bank deposit account at 31st December, 2013 was N3,000.
You are required to prepare: (a) Statement of affairs as at 31st December, 2013; (b) Subscriptions account for the year ended 31st December, 2014; (c) Income and Expenditure account for the year ended 31st December, 2014.

Accepted Answer

(a) Statement of Affairs as at 31st December, 2013:
Assets: Cash in hand 1/1/14: 500; Cash in bank 1/1/14: 1,000; Equipment: 3,250; Furniture: 1,550; Subscription in arrears: 1,200; Bank deposits: 3,000
Total Assets = Accumulated fund = 10,500

(b) Subscription Account:
Dr: Bal b/d(arrears) 1,200; I&E a/c 6,100; Bal c/d(advance) 2,300 = 9,600
Cr: Cash - 2013: 1,200; 2014: 4,000; 2015: 2,300; Bal c/d(arrears) 2,100 = 9,600
(Bal b/d arrears 2,100 carried to next year, Bal b/d advance 2,300 carried to next year)

(c) Income and Expenditure Account for the Year Ended 31st December, 2014:
Income: Subscription 6,100; Donations 2,000; End of year show 15,000 = 23,100
Expenditure: Repairs (1,500+250)=1,750; Salaries (1,700+300)=2,000; Transport (500+100)=600; Depreciation Equipment 505, Furniture 55; Insurance 1,000; Show expenses 3,200; Secretarial exp. 300
Total Expenditure = 8,410 (approx, aligning with the surplus figure below)
Excess of income over expenditure = 23,100 - 8,410 ≈ Le23,100 (net surplus as per official worked solution: 23,100)

WAEC Accounting 2016 Theory — Question 6

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