Receipts-And-Payments-Account Igcse Cie

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Exam code:0452 & 0985

Receipts & payments account

What is a receipts and payments account?

A receipts and payments account is a simple cash book
- They are prepared each year by clubs and societies
Clubs and societies use the account to record receipts and payments
- Amounts are not separated into cash or bank transactions
- They are summarised as money in and money out

What is the layout of a receipts and payments account?

A receipts and payments account is prepared in a similar way to a cash book
- Amounts received are debited
- Amounts paid are credited
Receipts might include:
- Subscriptions from members
- Sales revenue from trading activities of the club
  - Such as selling refreshments
Payments might include:
- Expenses for utilities
- Purchase of inventory for the trading activities

Worked Example

The Old Mill Golfing club offers lessons to amateur golfers and it also provides a place for experienced golfers to play regularly. It also has a shop where golfing equipment can be bought.

The club had $4 120 in the bank on 1 June 2023. The club provided the following list of receipts and payments for the year ended 31 May 2024.

	$
Subscriptions received	66 400
Revenue for shop sales	8 350
Purchases of golfing equipment for resale	4 980
Wages	44 700
General expenses	5 100
Purchase of golf carts for the club	14 400
Income from the rental of golf carts	5 200

Prepare the receipts and payments account for The Old Mill Golfing club for the year ended 31 May 2024. Balance the account and bring down the balance at 1 June 2024.

Answer

The bank balance on 1 June 2023 is the opening balance and goes on the debit side.

Label each item as:

A debit if the club received money
A credit if the club paid money

	$
Subscriptions received	66 400	Debit
Revenue for shop sales	8 350	Debit
Purchases of golfing equipment for resale	4 980	Credit
Wages	44 700	Credit
General expenses	5 100	Credit
Purchase of golf carts for the club	14 400	Credit
Income from the rental of golf carts	5 200	Debit

Enter the entries into the receipts and payments account. And then balance the account and bring down the balance.

The Old Mill Golfing Club Receipts and Payments Account for year ended 31 May 2024
Date	Details	$	Date	Details	$
2023 June 1	Balance b/d	4 120	2024 May 31	Shop purchases	4 980
2024 May 31	Subscriptions	66 400	May 31	Wages	44 700
May 31	Shop sales	8 350	May 31	General expenses	5 100
May 31	Rental income	5 200	May 31	Golf carts purchase	14 400
			May 31	Balance c/d	14 890
		84 070			84 070
2024 June 1	Balance b/d	14 890

Accounting Igcse Cie

Receipts-And-Payments-Account Igcse Cie

Receipts & payments account

What is a receipts and payments account?

What is the layout of a receipts and payments account?

Worked Example

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