92 (P1) (2)

2.  the following is the summarized balance sheet of Kee Fai Sports Club as at 31 December 1990:

$ / $
Furniture and fittings / 28 400 / Subscriptions in advance / 900
Sports equipment / 16 300 / Joining fees for ordinary members / 16 800
Bar stock / 1 500 / Life membership subscriptions / 32 750
Prepaid insurance (3 months) / 750 / Accumulated fund / 25 600
Subscriptions in arrears / 600 / Bar creditors / 3 000
Cash and bank / 33 500 / Rent (1 month) / 2 000
81 050 / 81 050

Receipts and payments in the year to 31 December 1991 are summarized below:

Receipts
$
Subscriptions and joining fees:
Ordinary members
1990 / 300
1991 - Existing members / 10 500
- New members / 12 000
Life members / 7 500
Annual dinner - ticket sales / 6 700
Bar takings / 89 500
126 500
Payments
Painting of club building / 5 000
Bar salaries / 26 000
Annual dinner - expenses / 3 500
Furniture and fittings / 15 000
Bar purchases / 27 500
Insurance (for 6 months) / 2 550
Sports equipment / 8 000
Rent (for 14 months) / 34 500
General expenses / 4 750
126 800

The following information is also available:

(i)  The annual ordinary membership subscription is $300. On joining the club each new ordinary member has to pay a joining fee of $1200 in addition to the annual subscripting. The joining fee is to be recognized as income evenly over three years.

The balance of the joining fee as at 31 December 1990 is made up of:

Year of joining
1989
1990 / Balance
$
4 800
12 000

(ii)  The club has a policy of writing off any subscriptions outstanding for more than one year. There are three members who have not paid the annual subscription for 1991.

(iii)  The life membership fee has remained at $2500 since the establishment of the club in 1986. It is to be recognized as income evenly over ten years. As at 31 December 1990, 20 persons had been admitted as life members.

(iv)  Furniture and fittings are to be depreciated at 20% per annum on a reducing balance basis.

(v)  Sports equipment was valued at $20 000 as at 31 December 1991.

(vi)  Bar stock and creditors amounted to $1800 and $4750 respectively as at 31 December 1991.

(vii)  Insurance premium of $2550 was paid on 2 January 1992 foe six months ending 31 March 1992.

You are required to prepare for the club:

(a) a statement of membership income for the year ended 31 December 1991, (9 marks)

(b) a bar trading account for the year ended 31 December 1991, (3 marks)

(c) an income and expenditure account for the year ended 31 December 1991, and (9 marks)

(d) a balance sheet as at 31 December 1991. (9 marks)