The opening balance of the prize fund was ₹1,00,000. During the year, donations received towards this fund amounted to ₹15,400, the amount spent on prizes was ₹12,300, prize fund investment is ₹40000 and interest received on prize fund investment was ₹4,000. What will be the closing balance of the prize fund?

₹1,07,100

The correct answer is option 3- ₹1,07,100.

Prize fund opening balance         = 1,00,000
Add: donation towards fund       = 15,400
Less: Prize awarded                  = 12,300
Add: Income from investments  = 4,000
                                               = (1,00,000 + 15,400 - 12,300 + 4,000)
                                               = 1,07,100

This 1,07,100 is shown on liability side as closing balance of the prize fund.

Prize fund investments are assets and shown on the assets side of the balance sheet.