A treasurer of a tennis club has prepared this draft statement of receipts and payments. The club committee, however, wants the financial statements for 20x3 (and subsequent years) to be in the form of an income and expenditure account and a statement of financial position. They have asked you to fix the 20x3 financial statements.

Additional information:

1. On 31 December 20x3, R700 was outstanding for membership subscription fees for 20x3.

2. During 20x2, R230 was received for membership subscription fees for 20x3.

3. The cost of equipment purchased in previous years was:

4. The committee decides that equipment should be depreciated at 10% per annum on cost.

5. Rent has been at the rate of R2 000 per annum for the last two years and is not expected to change in the immediate future.

6. Rates of R750 for the six months to 31 March 20x3 were paid on 2 November 20x2.

7. Interest of R250 on the bank overdraft had accrued at 31 December 20x3.

8. Taxation can be ignored.

You are required to:

1. Prepare the income and expenditure account for the year ended 31 December 20x3.

2. Prepare a statement of financial position as at 31 December 20x2 and 31 December 20x3.

Transcribed Image Text:

The Local Tennis Club STATEMENT OF RECEIPTS AND PAYMENTS FOR THE YEAR ENDED 31 DECEMBER 20x3 Opening balances Cash on hand: 1 January 20x3 Cash in bank: 1 January 20x3 Current account Deposit account Add: Receipts Membership subscription fees: 20x2 20x3 20x4 Interest on deposit account Entry fees for club championship Tickets sold for annual dinner/dance Less: Payments Groundsman's wages Purchase of equipment (on 30 June 20x3) Rent for year up to 30 September 20x3 Rates for year up to 31 March 20x4 Cost of annual dinner/dance Secretarial expenses Prizes for club championship Miscellaneous expenses Less: Cash on hand: 31 December 20x3 CLOSING BANK BALANCE: 31 DECEMBER 20x3 (OVERDRAFT) 3 260 00 100 00 1 160 00 2 000 00 9 680 00 620 00 8 220 00 125 00 85 00 210 00 420 00 (16 890 00) 4 000 00 8 000 00 2 000 00 1 800 00 500 00 400 00 90 00 100 00 (50 00) (4 000 00)