Joomla TemplatesBest Web HostingBest Joomla Hosting
Home

Articles

Subscriptions Account

In making entries in a subscriptions account, the following must be observed:

  1. Subscriptions that have not been paid for the previous year are brought forward as an opening balance on the debit side in the subscriptions account. It is a debit balance as those who owe are debtors.
  2. Subscriptions paid in advance for the following year are brought forward in the year as credit opening balance.
  3. During the year, subscriptions will be received for the next year. These are brought forward to the next year as an opening balance on the credit side.
  4. At the end of the year, it is very likely that some subscriptions are still not paid. The total of these subscriptions is brought forward to the following year’s subscriptions account as a debit balance.
  5. All the cash received for subscriptions is credited in this account while the cash account is debited.
  6. The difference between the totals of the two sides of the subscriptions account is the balancing figure and this is transferred to the Income and Expenditure Account.

An example of a subscriptions account is shown here.

The following information is available:

  • The subscriptions account is for the year 20X2.
  • The annual subscription for each member is $50.
  • In 20X1, 12 members paid their subscriptions for 20X2.
  • On January 1, 20X2 7 members have still not paid their subscriptions for 20X1.
  • By December 31, 20X2 11 members had not paid their subscriptions for 20X2.
  • During the year, cash was received for subscriptions for the following years:  


    • $
      For 20X1
      -
      125
      For 20X2
      -
      1,310
      For 20X3
      -
      50





      1,485




Subscriptions Account


Particulars
Amount


Particulars
Amount


$



$
20X2



20X2


Jan 01
Balance (owing) b/f
130

Jan 01
Balance (prepaid) b/f
35
Dec 31
Income & expenditure
1,450

Dec 31
Cash received
1,485
"
Balance (prepaid) c/d
50

"
Balance (owing) c/d
110









1,630



1,630







20X3



20X3


Jan 01
Balance (prepaid) b/d
35

Jan 01
Balance (owing) b/d
130


Last Updated (Tuesday, 12 October 2010 17:19)