Receipts and payments accounts 2011week

1. INCOME AND EXPENDITURE ACCOUNTS
Receipts and Payments
Accounts

2. Receipts and Payments Accounts
Used for small non-profit oriented organization.
The organization must have no assets or liabilities
It’s a summary of the Cashbook entries.
Gives a summary of cash received and payments
made during the year.

3. Receipts and Payments Accounts
Examples of organizations that use receipts and
payments as a record of financial statements are
small charities, clubs and associations.
Such organizations are mainly of a temporary
nature.

4. Example 1
Receipts and Payments Account for the year ended 31st December 2005
P P
Opening Bank Balance 800Groundsman wages 600
Hall Charges 1200
Total Subscriptions 5000Spots ground rentals 500
Gate Takings 2500Committee Expenses 300
Rent Received 800Stationery Costs 150
Bank Balance c/f 6350
9100 9100
The UB Running Club

5. Income and Expenditure Accounts
Used by non profit- oriented organization in the
place for trading, profit and loss account
Used by non profit oriented organizations with
assets and liabilities other than cash.
However a non profit oriented organization can
prepared a trading, profit and loss account if it has
to calculate profit for a specific business or event
done to make profit. Eg Football Club organizing a
dinner dance party etc. or a Club operating a shop.

6. Income and Expenditure Accounts
Profit -Oriented Organisation Non- Profit Oriented Organisation
1Trading and Profit and Loss Account1Income and Expenditure Account
2Net Profit 2Surplus of Inocme over Expenditure
3Net Loss 3Excess of Expenditure over Income

7. Fuel for the day
Hold yourself solely responsible for what your life
has become up to this point. Don’t blame anyone or
anything else for your position in life. If you take full
responsibility for your past, you have full authority to
create your future. Wes Beavis

8. Accumulated Funds
In the balance sheet of a NFPO the word Capital is
replaced by Accumulated Funds.
Assets = Accumulated Funds + Liabilities

9. Example 1
On the 1
st
January 2009 Gaborone Golf Club had the
following assets
Cash at Bank P200,Snack Bar Stocks P800 and Club
house buildings P12 500.
During the year to 31
st
December 2009 the club
received and paid the following amounts;

10. Example 1
Recepits Payments
Subscriptions 2009 3500Rant and Rates 1500
Subscriptions 2010 380Extention to Club House8000
Snack Bar income 6000Snack Bar Purchases 3750
Visitors Fees 650Secretarial Expenses 240
Loan from Bank 5500Interest on Loan 260
Competition Fees 820Snack Bar Expenses 600
Games Equipment 2000

11. Example 1
Notes . The snack bar stock at 31
st
December 2009 was
P900,
The games equipment should be depreciated by 20%
Prepare;
1)Snack Bar Profit or Loss
2)Income and Expenditure statement for the period ended 31
st

Decemeber 2009
3)Prepare the Balance Sheet as at 31
st
December 2009

12. Answer
Step 1. Start with the IEA and correctly copy the title.
Step 2 List the relevant incomes from question, the ones that
would normally go into the P&L Ac
Step 3 Pick each income, check from the question if it
requires adjustment, if not enter the Figure in IEA if
reference make required adjustment and enter the
figure.
Step 4 Determine the Snack bar profit.
Step 5 Repeat step 3 with expenditure and conclude the
IEA.

13. Income and Expenditure
Account for the year ended 31
st
March 2009
Recepits
Subscriptions 2009 3500
Snack Bar income 1750
Visitors Fees 650
Competition Fees 820
6720
Rant and Rates 1500
Secretarial Expenses 240
Interest on Loan 260
Depreciation on Games Equipment 400
2400
Surplus of Income over Expenditure 4320

14. Balance Sheet as at 31
st
December 2009
Fixed Assets
Club House Buildings 20500
Games Equipment 2000
Depreciation 400 1600
22100
Current Assets
Snack Bar Stocks 900
Bank 700
1600
Currrent Liabilities
advance Sub 380 380
23,320
Financed By
Accumulated Funds 13500
Add Surplus 4320 17820
Loan From Bank 5500
23,320