Accounting JAMB

What is the subscription to be charged to income and expenditure account?

subscription received during the year N30,000. Subscription owed last year N4,000. subscription received for next year N6,000.

 

A. N20,000
B. N30,000
C. N34,000
D. N36,000

Correct Answer:

Option D – N36,000

Explanation

An income and expenditure account is a record showing debits and credits for an organization within a particular time period. Income and expenditure accounts are also referred to as profit and loss accounts. Generally, these accounts are credited with debits and credits, whether paid or not.

the subscription to be charged to income and expenditure account = subscription for the year N30,000 + N6,000 subscrition for next year. ie, N36,000

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