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CA Foundation · Accounting · Financial Statements of Not-for-Profit Organisations

Ganga Cultural Society organised an annual function. Receipts from tickets were ₹1,20,000 and donations specifically collected for the function were ₹30,000. Expenses on the function were ₹1,05,000. What amount should be shown in the Income and Expenditure Account in respect of this function, assuming specific donations are treated as income of the function?

The function shows a surplus of ₹45,000. Ticket receipts of ₹1,20,000 plus specific donations of ₹30,000 give income of ₹1,50,000, and deducting expenses of ₹1,05,000 leaves ₹45,000, which is taken to the Income and Expenditure Account.

  1. ASurplus of ₹45,000Correct
  2. BSurplus of ₹15,000
  3. CDeficit of ₹15,000
  4. DSurplus of ₹1,20,000

Explanation

Income of the function = ticket receipts 1,20,000 + specific donations 30,000 = 1,50,000. Less expenses 1,05,000 gives surplus of ₹45,000. Option B wrongly omits the donations (1,20,000 - 1,05,000 = 15,000). Option C reverses the sign, and option D ignores the expenses.

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