Deck 25: The Final Financial Statements of Clubs

Question 1

A receipts and payments account is:

A) A summary of the cash and bank transactions for a period
B) Another name for an income and expenditure account
C) Similar to an income statement in reflecting revenue earned and expenses incurred during a period
D) A statement of financial position prepared for a non-profit making organisation

Answer 1

A summary of the cash and bank transactions for a period

Question 2

An income and expenditure account is:

A) A summary of the cash and bank transactions for a period
B) Another name for a receipts and payments account
C) Similar to an income statement in reflecting revenue earned and expenses incurred during a period
D) A statement of financial position prepared for a non-profit making organisation

Answer 2

Similar to an income statement in reflecting revenue earned and expenses incurred during a period

Question 3

Which of the following is typically treated as deferred income and released to the income and expenditure account in a systematic manner?

A) Donations
B) Entrance fees
C) One-off gifts
D) Lifetime membership fees

Answer 3

Lifetime membership fees

Question 4

Which of the following is correct?

A) Subscriptions receivable are current assets
B) Subscriptions receivable are current liabilities
C) Subscriptions in advance are current assets
D) Subscriptions in arrear are current liabilities

Question 5

The Culture Club has an accounting year ending on 31 December. At the 31 December 20X0 its accounts contained a balance on the life membership subscriptions fund of £4,650. At this date there were 120 life members of which 30 had joined more than 9 years previously.
The life membership subscription has always been £100. The Club has a policy of crediting the income and expenditure account with life membership subscriptions over a period of 10 years including the year in which the money is received.
During the year ended 31 December 20X1 there were five new life members, and one member, who joined in 20W8, died.
The balance on the life membership subscriptions fund at 31 December 20X1 after the transfer to the income and expenditure account will be:

A) £4,150
B) £4,200
C) £4,575
D) £4,635

Question 6

A club's membership fees account shows a debit balance of £300 and a credit balance of £180 at
1 January 20X1. During the year ending 31 December 20X1, subscriptions received amounted to £3,750. Subscriptions overdue from the year ended 31 December 20X0, of £80, are to be written off. At 31 December 20X1, subscriptions paid in advance amount to £150.
The amount to be transferred to the income and expenditure account for the year ending 31 December 20X1 is

A) £3,400
B) £3,560
C) £3,860
D) £3,940

Question 7

Which of the following is the correct treatment of life membership subscriptions paid on joining?

A) Add these to the accumulated fund of the club
B) Credit to revenue from a deferred life membership fund over a defined period in accordance with the . club's accounting policy on life membership subscriptions
C) Credit to revenue in full when received
D) Defer as an asset in the statement of financial position and amortise over the expected useful life of the member

Question 8

Calculate the subscription income for the North Social Club using the following data. Arrears 01/01/X0 £1,400.
Prepaid in advance 01/01/X0 £3,000 Arrears 31/12/X0 £2,400
Paid in advance 31/12/X0 £6,400 Cash received in year £28,400

A) £26,000
B) £28,400
C) £22,800
D) £34,000

Question 9

Calculate the subscription income for the South Social Club using the following data. Arrears 01/06/X0 £1,680, prepaid in advance 01/06/X0 £3,600, arrears 31/05/Y1, £2,880, paid in advance 31/05/Y1 £7,680, and cheques received in year £34,080

A) £40,800
B) £31,200
C) £34,080
D) £27,360

Question 10

I & E a/c 200 x 50 = £10,000
A social club has 200 members; each should pay £50 for their yearly subscription. At the start of the year - 20 members' owed subscriptions, at the end of the year 5 members had prepaid subscriptions. You are informed that 3 members' annual subscriptions from the previous year remained unpaid at the end of this year and these are to be written off. The cash receipts for the year are as follows:

A) £9,100
B) £10,600
C) £11,100
D) £11,400

Question 11

A debit balance on an income and expenditure account prepared for a club is dealt with by:

A) Including the balance in the statement of financial position as a prepayment
B) Deducting the amount from the accumulated fund
C) Adding the amount to the accumulated fund
D) Adding the amount to the bank balance in the statement of financial position

Question 12

How is the gift of a computer worth £1,500 from GI Jane posted to the financial statement of a club?

A)
B)
C)
D)

Question 13

The accumulated fund represents:

A) The shareholders funds in the club
B) The value of the club
C) The book value of the net assets of the club
D) The excess of the income over the expenditure in the club for the year

Question 14

A receipts and payments account is similar to:

A) An income and expenditure account
B) A cash book summary
C) An income statement account
D) A statement of cash flows

Question 15

A club received subscriptions during 20X2 totalling £6,250. This figure included £400 for 20X1 and £200 for 20X3. There were subscriptions in arrears at the end of 20X2 of £125. The subscriptions to be included in the income and expenditure account for 20X2 are:

A) £5,525
B) £5,775
C) £5,925
D) £6,175

Question 16

The club had an excess of income over expenditure in the period of £2,500. It had an opening accumulated fund balance of £26,000. During the year a member passed away bequeathing £5,000 to the club. In addition, a member gave the club an old snooker table worth £50. What is the closing balance on the accumulated fund likely to be?

A) £33,550
B) £28,550
C) £28,500
D) £33.500