Subscription outstanding at the beginning of year is ₹10,000, Subscriptions received during the year is ₹90,000 including ₹5,000 in advance for next year and subscription outstanding at the end of the year is ₹2,000.
How much amount of subscription will be entered in Income and Expenditure account?
Answer & explanation
Correct answer: option 4
The correct answer is option 4- ₹77,000.
Subscription received during the year = 90,000
Less: subscription received for the next year = 5,000
= (90,000 -5,000)
= 85,000
Less: Subscription outstanding at the beginning of year = 10,000
= (85,000 - 10,000)
= (75,000)
Add: Subscription outstanding at the end of the year = 2,000
= (75,000 + 2,000)
= 77,000
Thus, ₹77,000 is shown on the credit side of income and expenditure account.