Skip to content

CMA Foundation · Fundamentals of Financial and Cost Accounting · Financial Statements of a Not-for-Profit Organisation

Lakeview Cultural Society's Capital Fund on 1 April was ₹5,00,000. During the year it received ₹40,000 as entrance fees (to be capitalised), ₹60,000 as a specific donation for a building, and ₹15,000 as general donations, to be treated as capital. Surplus per Income and Expenditure Account was ₹35,000. What is the Capital Fund on 31 March, assuming the specific donation goes to a separate Building Fund?

The Capital Fund at year end is ₹5,90,000. It is opening ₹5,00,000 plus capitalised entrance fees ₹40,000, general donations ₹15,000 and the surplus ₹35,000. The ₹60,000 specific donation goes to a separate Building Fund, so it is excluded.

  1. A₹5,90,000Correct
  2. B₹5,75,000
  3. C₹6,50,000
  4. D₹5,50,000

Explanation

Capital Fund = 5,00,000 + entrance fees 40,000 + general donations 15,000 + surplus 35,000 = 5,90,000. The building donation of ₹60,000 goes to the Building Fund, not Capital Fund. Including it would give 6,50,000, which is wrong.

Did you get it right without looking?

One question tells you little. A timed set on Financial Statements of a Not-for-Profit Organisation shows your real accuracy, how long you take and where you lose marks.

Practise Financial Statements of a Not-for-Profit OrganisationFree diagnostic mock

More Financial Statements of a Not-for-Profit Organisation questions