Page 85 - VIRANSH COACHING CLASSES

5. Sale of old Assets :
When any asset became obsolete or useless for the concern, it is sold out. Amount relaised on it
in a Capital Receipt. The Book value of sale of such asset is deducted from the concerned asset.
The difference between the Book Value and Realised value is either Profit on Loss on sale of
Asset. It there is a Profit it should be shown to income side of Income and Expenditure Account.
If there is a loss it should be shown on Expenditure side of Income and Expenditure Account.
6. Sale of Scrap, News papers etc. Scrap of old materials is sold in the market. It is treated as
recurring income. Therefore, It is credited to Income side of Income and Expenditure Account.
Sale of old News Papers is a miscellaneous income. It is credited on Income side of Income and
Expenditure Account.
7) Specific Donations (please refer point No. 8)
8) General Donations (please refer point No. 8)
9) Specific Funds (please refer point No. 8)
10) Endowment Fund

It is a fund created out of specific amount embarked, gifted or donated. The Income of
this fund is a specific Income. It shows on the liability side of the Balancesheet.

Illustrations

1 : Treatment of Stationery
Balance Sheet
as on 31 March 2017
st
Liabilities Amount Amount Assets Amount Amount
` ` ` `
Stock of Stationery 800

Receipts and Payments Account
st
for the year ended 31 March 2018
Dr. Cr.
Receipts Amount Amount Payments Amount Amount
` ` ` `
By Stationery Purchased 7,000

Adjustments :
1) ` 1,500 is Outstanding for Stationery Bill.
2) Stock of Stationery on 31 March 2018 was ` 1,300.
st
With the help of above information calculate the amount of stationery cosumed during the year.

Particulars Amount `
Stock of stationery as on 1-4-2017 800
Add : Purchased during the year 7,000
Add : Outstand bill 1,500
9,300
Less : Closing Stock (31-3-2018) 1,300
Stationery consumed during the year 8,000

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