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Kaveri Club held a charity dinner. Ticket sales were ₹90,000 and the expenses on the dinner were ₹66,000. What is the amount to be shown in the Income and Expenditure Account if the event is shown on a net basis?

On a net basis the event shows a surplus of ₹24,000, which is ticket receipts of ₹90,000 less expenses of ₹66,000. This surplus is shown on the income side of the Income and Expenditure Account.

  1. ASurplus of ₹24,000 on the income sideCorrect
  2. BLoss of ₹24,000 on the expenditure side
  3. CIncome of ₹90,000 on the income side only
  4. DSurplus of ₹1,56,000 on the income side

Explanation

Net of the event: ticket receipts ₹90,000 less expenses ₹66,000 gives ₹24,000 surplus. It is credited as income of the event. Adding the two figures gives ₹1,56,000, which is the mistake of adding instead of subtracting.

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