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

Lotus Sports Club received subscriptions of ₹3,60,000 during 2024-25. Subscriptions outstanding were ₹30,000 at the start of the year and ₹45,000 at the end. Subscriptions received in advance were ₹12,000 at the start and ₹20,000 at the end. What amount of subscription income is credited to the Income and Expenditure Account for 2024-25?

Subscription income is ₹3,67,000. Start with receipts of ₹3,60,000, subtract opening outstanding ₹30,000, add closing outstanding ₹45,000, add opening advance ₹12,000 and subtract closing advance ₹20,000, so that only subscriptions relating to the current year are credited.

  1. A₹3,53,000
  2. B₹3,67,000Correct
  3. C₹3,83,000
  4. D₹3,59,000

Explanation

Income = Received 3,60,000 - opening outstanding 30,000 + closing outstanding 45,000 + opening advance 12,000 - closing advance 20,000 = 3,67,000. Check via the subscription account: opening debit 30,000 + income 3,67,000 = 3,97,000 and credits 3,60,000 + 12,000 opening advance + 45,000 closing outstanding... the totals balance after including advance movement. Option ₹3,53,000 reverses the sign of the advance and outstanding adjustments.

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